I started my first ecommerce business on a whim in 2008 and sold vintage-inspired jewelry on Etsy.
My marketing budget to get the store off the ground was non-existent. And I covered my own startup costs, which largely included sourcing my materials — chains, charms and clasps — from suppliers on the Etsy platform, as well as craft stores.
Things were pretty different back then. Social media algorithms were in their infancy, my Tumblr blog was thriving and ecommerce still sort of felt shiny and new.
For five years, I ran this online-only operation and grew it to a point where it eventually earned five figures per month. My jewelry was spotlighted on countless fashion blogs and sold in eight different boutiques, and my business was featured as a top-selling store.
But when I started freelance writing full time, I decided I couldn’t do both businesses well. Plus, I was feeling burnt out by the demands of a growing online business as a one-person operation.
I needed a break. So, I decided to close down my online jewelry store and sell off my remaining inventory.
But lately, I’ve been thinking about getting back into this world... and how I’d approach things differently.
Here’s what I’d do if I were relaunching my online business in 2020.
Focus on Creating a Distinct Product and Offer
My first ecommerce business didn’t sell original products; rather, curated collections of vintage and vintage-inspired pieces. If I were relaunching today, however, I’d take an entirely different approach.
I’d make sure what I was selling was brand new to the market and original, and that everything from product to positioning was carefully crafted. After all, "products need to innovate and push the limits of the category, bring something new to the table or have it positioned in a new way,” according to Mike Airaudi, CEO of MINUS-8 watch.
If there’s one thing I’ve learned from studying the retail industry (and specifically the DTC world) for the past several years, it’s that truly great products are what help these brands sustain long-term success. Sure, good packaging and a catchy tagline can make a brand look and feel a certain way. But if the product is lacking, customers won’t stick around for the long haul.
If I were to start again, I’d ask myself the following questions:
- Why is this product (or service) needed?
- Why is it important?
- Why is it useful?
A major part of this process includes conducting market research, nailing the brand story and deeply understanding the target customer.
Nail Down the Profitability and Economics
With my first DTC brand, I was brand new to selling online and didn’t know much about margins (other than I wanted to keep mine at about 3x). I didn’t have a data-driven approach. Rather, I experimented with different sales tactics, ranging from discounting to bundling products and more.
My operation was always profitable thanks to those solid margins. But I quickly learned the dangers of over-discounting: If you do too many sales, customers will just wait for the next one to make a purchase (rather than buying at full price).
While I learned a lot through trial and error, I know things are different today — and the ecommerce brands that succeed are the ones that know the numbers side of the business. Especially when it comes to profitability.
As Chris Cantino, founder of Supermaker, shared, “Brands today should be profitable on the first purchase — not playing catch-up down the road.”
Along with defining gross margin and the specifics behind product and shipping, I’d get clear on metrics like customer acquisition costs, lifetime value of a customer and ROI for different marketing channels. I’d also work to establish a long-term plan for customer acquisition, retention, referrals and loyalty to create a more sustainable operation over time.
Talk to Customers and Build a Community
Thriving ecommerce brands know their customers — and they talk to them regularly.
I did an OK job of this with my first business. I leveraged my Tumblr blog followers and email newsletter subscribers. I also reached my community organically through Facebook, Twitter and Instagram, and engaged with them on those platforms.
Today, however, I’d make customer feedback a core piece of every business decision. This time around, I’d focus on the following:
- I’d understand my customers' deepest feelings and thoughts around the pain points associated with the problem my product solves.
- I’d align my value proposition around features and benefits, and how it ties into overall messaging.
- I’d foster the first 100 customers to be my most excited and loyal group (who then act as brand evangelists).
So often, first-time business owners see community-building as a secondary activity. But when it’s front and center, it can do wonders for building a brand’s word of mouth buzz and organic, low-cost growth.
Paul Munford of Lean Luxe agrees. “When you see what can be done with a community and realize the impact it can have when done right, it can truly be a powerful asset,” he said. “But that takes time and a long-term view; often a longer one than most folks would be comfortable with. But you can't rush these things, no matter what your investors or your fellow founders tell you.”
From studying brands that understand customer obsession, such as Glossier, Food52 and HODINKEE, I’ve seen how powerful community-building can be when it comes to gaining early traction. As such, I’d be sure to institute an ongoing feedback loop with customers as the brand and its products evolved over time. For example, I’d create a Facebook community group or private Slack channel, use social listening, and conduct one-on-one conversations with consumers through video, phone or email.
Create an Authentic Founder Story
I never fully realized the importance of an authentic founder story until I started covering retail as a journalist. Now, I can see clearly that this is a critical piece of strategy for any new brand today.
The reason? People like to buy from other people — not necessarily faceless brands.
So what does it mean to create an authentic founder story?
If you ask Helena Price Hambrecht, co-founder of Haus, she says that authentic founders have intent, passion and domain expertise — and they find a way to tell this story in a way that relates to the mission and customers. Along with this, they show life behind the scenes, share the process and bring people along on the brand’s journey.
“It’s not about the ‘face’ to the brand per se, but more how the founder has a relevant tie-in to the product and customers,” she said.
Personally, I’d build my founder story around working and reporting on the ecommerce industry the past seven years since closing my first store — and everything I’ve learned since my last go-around.
Final Thoughts on Launching an Ecommerce Brand in 2020
These are just a few of the things I’d keep top-of-mind if I were getting back into ecommerce right now, but I will add this as a final note: Technology and tools have also come a long way since I operated a DTC brand.
That means there is so much more brands can do today to not only make selling easier, but to make running an ecommerce business simpler, faster and better. Had I had a resource like Shogun, for example, I may have never closed down my online store at all.
Brands that are just now launching should make the most of these resources — and capitalize on the growing shift toward ecommerce and buying online.