The Secret to Creating an eCommerce Competition Barrier

THE SECRET to creating an ecommerce barrier to entry

Online sales for November and December 2016 alone were over $110 billion, which is 13% more than the same time period in 2015. Bricks and mortar stores are recognizing a decline in store traffic as shoppers are doing the majority of their shopping online, where it’s easier to search for discount codes and compare vendors. While a budding online retailer may embrace this opportunity, it creates fierce competition. Companies with skin in the game have deeper pockets and can survive with lower profits, breaking even, or even losing money for a short period of time. Why? Because they’ve built a model that results in repeat business.

Customers will come back to purchase again and usually spend more money. Centering your marketing strategy and website around the goal of generating repeat sales is the secret to creating a market entry barrier–and keeping your competition out.

Why is Repeat Business to Key to Creating a Barrier to Entry?

  1. 40% of eCommerce stores revenue comes from repeat business. Yet most companies spend 80% of their marketing budget on acquiring new customers. So while they’re scrambling to find new customers, use the tactics below to optimize your website and marketing strategy for repeat business.
  2. Customers are 9x more likely to convert than a first time buyer. The average conversion rate is around 1-3% but converting existing customers is much easier–about a 60-70% chance.
  3. With an effective strategy that encourages repeat business that increases the customer lifetime value (LTV), there will be less pressure on increasing the dollar value of your first-time sales.
  4. Generating repeat business creates a barrier to entry that newcomer eCommerce businesses can’t replicate. They are forced to allocate their budget on finding new customers and making large first-time sales.

Try these strategies to build a repeat customer conversion machine and create an indestructible barrier to entry.


Remarketing allows you to show ads to individuals who have taken a specific action on your website. Facilitated through a third party network like AdRoll or Google display network, many marketers typically use remarketing to gently nudge visitors who viewed a particular product page but did not purchase, but remarketing is also a great strategy to bring customers back for another purchase. Here are a few ways to use remarketing to bring customers back to your website:

  • Show ads for related products or services
  • Remind customers that it’s time to restock their supply of an item they’ve bought in the past
  • Offer an incentive to purchase another item as a gift

You’ll need to start building a list in order to successfully set up a remarketing campaign so if you’re not sure where to start, we can help!

Segmented Email

The average professional sends and receives 122 emails per day. So the stakes are high to send engaging emails that result in a repeat sale. Marketing emails are probably part of your marketing strategy but do you separate customers from your email blasts? Very few companies take the time to segment their lists effectively. Individuals who have purchased from your company in the past are in a completely different stage of the funnel and should be treated differently. Have you ever received an email that doesn’t speak to your needs whatsoever? You probably have, but didn’t notice that it was merely a segmentation oversight by the marketer.

Drilling down even further, customer emails should be segmented to differentiate new customers and long-term customers. Both types of customers have unique needs that can be addressed with separate messaging.

Try these ideas for customer emails:

  • Join the community! Send customers an invitation to join a private Facebook page where individuals can share tips, ideas, and ask each other questions related to your products or services.
  • Tag a photo to get featured. Send an image of your most recent posts on social media and ask your customers to tag a photo using your products for a chance to get featured on your networks.
  • Launching a new product or service? Send a pre-launch or early access to your customers ahead of time. They’ll appreciate the gesture and this will help build anticipation.

Subscription Model Products & Services

There are plenty of ways to build the subscription model into your current offering. They offer benefits to both you and customers: you’ll receive more repeat sales and a higher customer lifetime value (LTV) while customers get the added convenience and lower pricing. The first step to get started with the subscription product/service model is to do extensive research. You need to define your target persona in extreme detail, beyond their basic demographic details. This knowledge will help you frame what’s included in your subscription model and how to target the personas interested in these products.

Coupon Codes for Incentivizing

Coupon codes are a simple and effective way to bring customers back to your site. Why not create a customer upsell email campaign with specific messaging that lets readers know this email was written with them in mind?

However, be strategic about using coupon codes. You don’t want to set the expectation that customers can use a discount code for every purchase. Alternatively, they may wait for a coupon code to present itself and may forget altogether about their purchase. Work with an eCommerce conversion expert to develop a discount code strategy that drives repeat purchases but also aligns with your revenue goals.

Provide Great Customer Service [The First Time]

Excellent customer service should be embedded into the DNA of your company, but it’s even more important during that first purchase or engagement with a new customer. If your customer’s expectations of your customer service fall short, they’ll likely be apprehensive to purchase from you again, or worse, provide a bad review. Go out of your way to make the customer feel appreciated. Take this firsthand example from our experience with A team member here at Conversion Giant ordered a GoPro stabilizer to use during an upcoming trip to Hawaii. The item was shipped to the wrong address and therefore would not arrive in time for the trip. Customer service at Jet quickly refunded the purchase and sent a handwritten postcard in the mail with well wishes for a great trip to the customer. Mistakes happen all the time, but making the effort to make customers feel valued can go a long way in terms of building trust and encouraging future purchases.

The morale of the story is: don’t fall into the category of eCommerce businesses who spend 80% of their marketing budget to acquire new customers. Create a solid conversion funnel that sets you up for repeat business.
What strategies have helped your eCommerce company create market entry barriers?

About Andrea Moxham

Creative, driven marketing and communications leader with a proven track record in strategy and implementation. Entrepreneurial spirit and experience with inbound marketing, social media, digital marketing, and public relations.