This material does not constitute legal, tax, accounting, or other professional advice and is only for general informational purposes. Readers should consult a qualified professional to obtain advice for their own circumstances and supply chain.
On 1 July 2021, the 27 member states of the European Union (EU) will be making changes to value-added tax (VAT) obligations. The changes will affect businesses that sell goods from one EU country to another (known as distance selling) as well as businesses that sell goods which are imported from a non-EU country and delivered to an EU shopper. There are also changes to the rules for business to consumer services.
The changes aim to simplify tax filing for all merchants selling within and to the EU, as well as assist EU businesses in competing on equal footing with non-EU businesses who may not currently charge VAT. This article provides an overview of the changes coming for EU and non-EU merchants selling to shoppers in the EU.
1. Changes for Intra-EU Distance Selling
These changes are applicable to merchants with existing stock in the EU which are sold cross-border from one EU country to another (for example: selling goods located in France to a shopper in Germany). Specifically, the changes are in relation to:
- 1.1 Withdrawal of distance selling thresholds
- 1.2 Introduction of One Stop Shop (OSS) filing
- 1.3 Introduction of EU-wide threshold for micro-businesses
1.1 Withdrawal of distance selling thresholds
Until 30 June 2021, the EU distance selling thresholds are as follows:
- €100,000 per annum: Germany; the Netherlands; Luxembourg; Northern Ireland which is still in the EU VAT regime (£70,000)
- For other countries of the EU, it is €35,000 per annum or local currency equivalent
From 1 July 2021, the EU distance selling thresholds will be replaced by an EU-wide distance selling of threshold of €10,000. This means from 1 July 2021, merchants selling intra-EU cross-border, must charge VAT at the rate applicable in the shopper’s EU country of residence from the very first sale if their total cross-border sales across the EU exceed €10,000. Merchants will need to report these sales to the appropriate foreign tax authority unless exempt (see section 1.3).
To coincide and assist with the above change, the EU is introducing One Stop Shop (OSS) filing which provides a new way to file VAT returns for ecommerce merchants engaged in intra-EU cross-border sales (see section 1.2).
1.2 Introduction of One Stop Shop (OSS) filing
From 1 July 2021, merchants in the EU will be able to file a simplified EU VAT return, called the One Stop Shop (OSS), to assist with reporting their intra-EU cross-border sales to multiple EU countries. Merchants do not need to be registered for VAT in the EU countries that are included in their OSS filing, so long as those included are not their home EU country or an EU country where they have a physical location or hold inventory.
Merchants will be required to submit an electronic OSS filing using their domestic OSS portal on a quarterly basis, as well as keep a record of all reported sales for at least 10 years.
For the EU countries where the merchant has a physical location or holds inventory, such as in a warehouse, merchants may need to be VAT registered and file a domestic VAT return in each country.
OSS minimizes the overhead of registering for VAT in every EU country where intra-EU cross-border sales occur and simplifies the tax filing process by consolidating all relevant intra-EU sales to one OSS filing.
1.3 Introduction of EU-wide threshold for micro-businesses
Merchants with less than €10,000 per annum in intra-EU cross-border sales of B2C goods and services will be exempt from the obligation of completing an OSS return. Instead, eligible merchants will be allowed to charge their domestic VAT rate and report the sales below this threshold within their domestic VAT return.
2. Changes for Non-EU Merchants Exporting Goods to Shoppers in the EU
These changes are applicable to non-EU merchants that are selling cross-border from a non-EU country to an EU country (for example: selling goods from Australia to a shopper in Italy). Specifically the changes are in relation to:
- 2.1 Withdrawal of VAT exemption threshold for low-value consignment imports
- 2.2 New €150 VAT cap for imports to use new simplified filing
- 2.3 Import One Stop Shop (IOSS) filing
2.1 Withdrawal of VAT exemption threshold for low-value consignment imports
From 1 July 2021, the current VAT exemption for goods in low-value consignments (up to the value of €22) imported for delivery to shoppers in the EU, will be withdrawn. This means, merchants currently taking advantage of this existing VAT exemption will need to understand and prepare for any new schemes that are applicable from 1 July 2021 (see section 2.2).
2.2 New €150 VAT cap for imports to use new simplified filing
From 1 July 2021, VAT on importing goods into the EU can be paid under an optional simplified regime where the goods are part of a consignment of an intrinsic value not exceeding €150 and the goods are imported from non-EU countries for delivery to shoppers in EU countries.
The €150 intrinsic value is essentially the price of the goods excluding VAT, transport and insurance costs if separately itemized, and any other taxes or charges. If the intrinsic value of the goods in the consignment is €150 or less, merchants will still be required to collect VAT on separately itemized transport/insurance costs. For example:
Price of the goods as indicated in the invoice: €140
Transport charges as indicated in the invoice: €20
VAT (20%) as indicated in the invoice: €32
Total invoice amount: €192
Merchants with consignments meeting the above criteria can choose from one of the following approaches:
- 2.2.1 Collect the equivalent import VAT at point-of-sale and report and pay the VAT collected to the EU on a monthly basis through the IOSS filing
- 2.2.2 Merchant pays the import VAT or DDP (Delivery Duty Paid)
- 2.2.3 Shopper pays the import VAT or DDU (Delivery Duty Unpaid)
2.2.1 Collect the equivalent import VAT at point-of-sale and report the VAT collected to the EU on a monthly basis
To assist ecommerce merchants that choose to take this approach, the EU is introducing the Import On Stop Shop (IOSS) filing, a new way to file VAT returns for ecommerce merchants engaged in cross-border sales from non-EU countries to EU countries (see section 2.3).
2.2.2 Merchant pays the import VAT or DDP (Delivery Duty Paid)
Merchants that opt to pay the import VAT at the time of import, which is also known as DDP (Delivery Duty Paid), can work with their shipping provider to have the shipping carrier bill for the import VAT on a per shipment basis.
This approach streamlines the sales process and minimizes unexpected costs on the shopper, which can result in negative feedback and returns. BigCommerce is partnered with a number of cross-border solutions which can offer this service, including; Global-E and Zonos.
2.2.3 Shopper pays the import VAT or DDU (Delivery Duty Unpaid)
Merchants can also opt for the shopper to pay the import VAT at the time of import, which is also known as DDU (Delivery Duty Unpaid). In this scenario, the import VAT may be first paid by the shipping carrier or customs agent on behalf of the shopper, in addition to any customs brokerage fees. They will then bill the shopper and release the goods once paid.
If the shopper refuses to pay the bill, then the goods may be returned to the merchant who may then be obligated to pay any import costs and return shipping fees.
Separately, if a merchant is using an OMP (Online Marketplace) or platform, then the OMP or platform will be liable for VAT on those sales. BigCommerce is not a facilitating OMP or platform.
Note: Import VAT as well as import duties will continue to apply, as they do today, to all consignments imported to EU countries above the €150 threshold.
2.3 Import One Stop Shop (IOSS) filing
From 1 July 2021, merchants that choose to collect VAT at the point-of-sale for all consignments not exceeding €150 being imported from non-EU countries to shoppers in EU countries, will be able to file a EU VAT return, through the Import One Stop Shop (IOSS). Merchants only need to register for IOSS in one EU state and they will be issued a unique IOSS identification number which should be listed on all packages sent to EU countries. This will indicate to customs authorities that VAT is being properly declared and help ensure speedy customs clearance.
Unlike the OSS, IOSS will be a monthly filing submitted to a tax authority in one nominated EU country and it will declare import VAT due in all EU countries. It will be particularly useful where the merchant’s shoppers are located in other EU countries and the merchant wants to take care of the import VAT on behalf of the shopper.
Finally, IOSS is not compulsory for consignments of an intrinsic value not exceeding €150. Merchants can instead work with their shipping carrier to pay the import VAT on their behalf before being billed for it by the shipping carrier or alternatively, pass the import VAT onto shoppers to pay (see sections 2.2.2 and 2.2.3).
Note: Non-EU merchants, including from the UK, may need to appoint a VAT Intermediary to act as their agent in a similar way to a Fiscal Representative to support their EU VAT registration under the IOSS (learn more here).
Frequently Asked Questions
1. How can I register for OSS / IOSS?
Each EU country will have a domestic online OSS portal where you can register. This single registration will be valid for all sales to consumers in other EU member states where merchants don’t have a physical location or stock inventory. However, non-EU merchants wanting to register for IOSS in the majority of cases will likely need to apply for IOSS registration through an intermediary.
2. In which EU country should I register for OSS / IOSS?
For OSS registration, EU merchants must register in the EU country in which they are established and non-EU merchants should register in the EU country they hold stock. If there are multiple locations, then the merchant may choose the EU country where they want to register. For IOSS registration non-EU merchants are free to determine which country to register but are likely required to appoint an intermediary.
3. What’s the benefit of registering for OSS as an EU merchant?
Using OSS will simplify the filing process and save merchants time and compliance costs in from registering for VAT in multiple EU countries where they sell to shoppers.
4. Does the €150 import VAT threshold include or exclude tax?
The €150 threshold is exclusive of tax and includes the value of the consignment of goods being shipped. You can also exclude separately itemized shipping and transport costs from this threshold, but you must remember to add VAT on these amounts.
5. I’m still not sure how the upcoming EU VAT changes will impact my business. Where can I go for more information?
If you’re unsure how these changes will impact your business and the changes you need to make to support them, consider contacting a tax consultant or lawyer for more information.
6. Is BigCommerce a marketplace or facilitator?
BigCommerce is not a facilitating OMP / platform.
7. How is Bigcommerce supporting sales tax calculations involving Northern Ireland?
In partnership with Avalara, when AvaTax is the enabled tax provider, BigCommerce will be sending a country code of “XI” when requesting tax quotes involving Northern Ireland to ensure the most accurate sales tax quotes are returned by AvaTax.
8. Are there solutions available on BigCommerce that can assist with addressing these changes?
Avalara AvaTax can assist with VAT registration, collecting the equivalent import VAT at point-of-sale and reporting VAT returns.
Global-E and Zonos can assist with import VAT collection (DDP). Finally, ShipStation can assist with international shipments, commercial invoices and customs declarations.
9. What if I have Manual Tax enabled on BigCommerce?
If Manual Tax is enabled, you will not be able to collect the equivalent import VAT at point-of-sale based on the consignment not exceeding €150. Instead consider DDP (section 2.2.2) or DDU (section 2.2.3).
10. How do I customize my BigCommerce invoices?
There are four editable invoices in BigCommerce, including; email invoice, merchant printable invoice, shopper printable invoice and detailed customer printable invoice. Find out more about how to customize them here.
- European Commission: Modernising VAT for cross-border e-commerce
- European Commission: All you need to know about the One-Stop Shop (OSS)
- European Commission: All you need to know about the Import One-Stop Shop (IOSS)
- EU July 2021 ecommerce VAT Package
- 2021 Guide: ecommerce EU VAT reboot
- Understanding the UK Value-Add Tax: How to Prepare for Brexit as an Ecommerce Business
This material does not constitute legal, tax, accounting, or other professional advice and is only for general informational purposes. Readers should consult a qualified professional to obtain advice for their own circumstances and supply chain.
Data, analytics and business intelligence are common topics in the business world. Businesses across sectors, including ecommerce, are investing heavily in new technologies around data collecting and use of data.
That’s because data-driven decision making is more important than ever for ecommerce businesses as they seek to understand their audience, make tactical business decisions, and stay ahead of competitors.
However, while most businesses are well aware of the importance of leveraging data for the business insights it can provide, many struggle with best practices around using data to inform business outcomes.
In this post, we’re sharing some of the challenges ecommerce businesses face with data, how the right combination of strategies and technology solutions can help provide much-needed insights, and examples of ways BigCommerce merchants are using data solutions and insights to drive their business forward.
The Challenge: Too Much Data, Not Enough Insights
According to a report by Forrester called “Data Literacy Matters,” 90% of global data and analytics decision makers are focusing on prioritizing data insights in business decision making. The same report indicates that 91% of organizations report that they struggle with improving their use of data for business insights.
Businesses are more eager than ever to make investments in data and recognize its importance. Yet, many still struggle to turn their data into insights — and these insights into actions.
In fact, a Forrester states that between 60% and 73% of all data within corporations goes unused. Additionally, data from Statista identifies that 25% of companies are struggling with too much data.
This is where technology solutions can help you build a data-driven business.
Technology Solutions That Can Help You Make Data-Driven Decisions
Utilizing the right combination of data solutions is one way merchants can generate insights that allow them to make data-driven decisions and create customer experiences that help their businesses grow.
1. Data warehouses.
A data warehouse is a central repository or data catalog of integrated data, usually from multiple sources. A strong data warehousing architecture can provide a business with valuable data points.
It isn’t just huge enterprises that can use data warehouses to gather information that is relevant to their businesses. Data warehouse tools can work with businesses of all sizes. While the term “warehouse” brings to mind a physical place, many tools are available on the cloud, making them ideal to scale to the size you need.
Google BigQuery is a great example of a data warehouse that BigCommerce has built a native integration with for merchants on Pro and Enterprise plans.
Google BigQuery works in conjunction with Google Cloud Storage. It’s a fully managed data warehouse on RESTful web service that offers a scalable and cost-effective place to store your data. They also have a generous freemium tier and an easy-to-use UI which makes the tool accessible to a broader group of users.
2. Business intelligence solutions.
Data warehousing is a part of business intelligence. So what’s the difference between a data warehouse and a business intelligence solution? Essentially, data warehouses are tools that help you store the data while business intelligence solutions help you to analyze the data in concrete ways to support data-driven decision making and forecasting.
These tools can help you take the abundance of data you have and view it in dashboards that make sense to your various teams. Here are a few examples of these tools:
Google Data Studio is a data visualization tool that provides your team with some powerful ways of looking at your data. It has the advantage of being free and tightly integrated with Google BigQuery. Additionally, BigCommerce merchants can take advantage of pre-built reports to get started with Google Data Studio.
Tableau describes itself as a data visualization software with the goal of helping anyone to understand their data.
- Microsoft Power BI is an industry leader in the business intelligence solutions field. Run by Microsoft, the solution provides interactive data visualizations with easy-to-understand dashboards.
3. Customer data platforms.
Today’s customers seldom just visit one store, make a purchase, and go about their life. They research and shop across multiple sites and platforms before making a decision. Tracking that omnichannel customer journey is where customer data platforms come in.
Customer data platforms, or CDPs, collect data to build customer profiles that can help inform marketing efforts. They work by capturing information as customers move across each touchpoint and aggregate the data so that it can be used by other business intelligence systems.
CDPs can help your business avoid data silos by making sure your teams know who your customers are, how they shop, and what makes them tick. The better you know your customers and their needs, the better you can market to them and solve their issues.
Segment is an example of a CDP that integrates with other business intelligence tools, as well as the BigCommerce platform, and allows you to unify your view of your customers across all products and channels.
Personalization solutions enable businesses to transition from a one-to-many customer marketing strategy to a one-to-one approach. With personalization solutions, you can deliver custom experiences for each shopper through dynamic content, product recommendations, discounts and offers and so much more. Here are some examples of personalization solutions in the BigCommerce partner ecosystem:
Understanding how your customers behave online can give you powerful insights into what’s working and what’s not on your ecommerce site. At its most basic, analytics refers to systematic computational analysis of data, which can be used to measure metrics across web, marketing, search and sales.
Here are some examples of analytics solutions in the BigCommerce partner ecosystem:
BigCommerce Provides an Open Platform for Data
The above types of data solutions have something in common: they rely on each other to work. Business intelligence isn’t something accomplished by one tool, but by a system working together to gather, store, and analyze data into actionable insights. Data-sharing between systems is an important part of this.
The key to taking advantage of the power of data is communication. That is to say: communication between data tools. There is no point in gathering and storing data if you can’t analyze it. And there’s no point in having it analyzed if it’s not viewable in a way that is meaningful for your teams.
That’s why at BigCommerce, we embrace a philosophy of openness, so that you have control over your data and can use the solutions that will have the biggest impact on your business — we like to call this our Big Open Data Solutions.
Big Open Data Solutions is a full product suite featuring both native and best-of-breed partner data solutions that give merchants the ability to aggregate, analyze, understand and use online store data to gain insight into customer behavior to enhance decision-making and improve business performance.
How BigCommerce Customers are Making Data-Driven Decisions
Here are some examples of how BigCommerce merchants are leveraging our Big Open Data Solutions to generate insights and make decisions.
Origin, an apparel and nutrition brand that handcrafts its products in the mountains of Maine, has been optimizing their tech stack to keep up with channel growth. Specifically, the company has leveraged the BigQuery integration and pre-built Data Studio reports to harmonize consumer data from multiple sources as part of their overarching omnichannel strategy.
“BigCommerce’s BigQuery integration allowed us to provide clean, actionable data while avoiding (error prone) manual reporting in order to make better decisions for the business. It’s been key in unifying our data and providing the insights required to make the right investments,” Sid Martin, Systems Analyst at Origin.
For Garrett Wade, a premier provider of fine woodworking tools and hand tools for the garden, the BigCommerce integration with BigQuery has been “game changing” for the company’s analysts.
This integration with BigQuery allowed the business to start looking at actual, accurate data from day one. The company reported spending very little time cleaning and normalizing the data. Plus, they were able to utilize the data to verify the accuracy of the testing environment prior to our launch. This also allowed the company to develop vetted reports right away; thus, creating the space that the development team truly needs to do the more difficult report work.
Being able to analyze how shoppers perform and behave, then churn out detailed reports in Tableau from a single location is not only efficient for the company’s two-person development team, but cost effective.
“When we were evaluating the move to BigCommerce as our platform provider, the integration with Google BigQuery was not high on the decision tree, but after using it for several months now, I can honestly say that this feature confirmed that we made the right choice with BigCommerce. I highly recommend,” stated John Chan, Inventory Planning and Business Intelligence Analyst, Garrett Wade Company.
Fore Ladies Golf
Fore Ladies Golf, a woman-owned business committed to providing women golfers with high-quality golf clothes, launched successfully on BigCommerce in 2018. However, owner Jessica Benzing quickly realized that she needed a solution for reporting and analytics to build a more data-driven strategy for her business.
Turning to Glew, Jessica was able to get a handle on what was working, what wasn’t, and what she needed to do to continue to scale. With Glew, she has a view of her top KPIs to analyze Facebook and Google Ads campaigns; a report on inventory to help manage budgeting and ensure consistent stock levels; and customer segmentation data to run targeted campaigns to her VIP customers, discount shoppers and more.
We know that data has power. As consumers demand more personalized experiences from ecommerce, shop in more omnichannel ways, and generally turn to ecommerce more and more for their purchases, the need to collect and understand data is only growing.
Having an ecommerce platform that supports your data-driven strategy is going to be crucial. At BigCommerce, we believe open SaaS is the future — and data is an important part of that. Being able to choose the data solutions from warehousing to analytics that best support your business intelligence goals and having them able to easily communicate with each other will make all the difference in honing a streamlined data strategy.
Effective decision making starts with data. However, before you can start making decisions, you need the right technology solutions in place to translate raw data into actionable insights.
With that in mind, BigCommerce is excited to share more details about how merchants can take advantage of our partnership with Google and their robust data solutions, including Analytics, BigQuery and Data Studio.
While you might already use Google Analytics for measuring website traffic, product sales, conversion rates, and so much more, you may not be familiar with Google’s advanced data offerings and how they work with the BigCommerce platform.
To help explain, we’ve brought in some of our internal experts, Derrek Pearson, Senior Manager, Product Management, and Mindy Regnell, Market Insights Manager, to answer some questions.
First off, what is Google BigQuery and Google Data Studio?
Google BigQuery is an analytical data warehouse that enables you to bring together all your data from various sources. Once you have your data in one place, you can leverage structured query language (SQL) and artificial intelligence (AI) to ask analytical questions and visualize your data so that you can make strategic business decisions.
Google’s Data Studio is a free visualization tool that you can use to build and customize reports that are easy to share with your team.
So what is the advantage of the pre-built Google BigQuery integration with the BigCommerce platform?
While merchants with no developer skills could always sign up for a free Google BigQuery account, the difficult part has always been moving their data. There’s a lot of development work that must take place, either building the connection yourself or going through third-party tools.
Exactly, it’s not as easy as exporting and importing using a CSV file because there’s only so much data that you can export cleanly into a CSV file. Instead, you’re using APIs, and you probably need to involve a developer, which makes the process more resource-intensive.
With the pre-built integration, we’ve done the work for you to get your BigCommerce data into the data warehouse. Now, you can go into your control panel, follow a series of very simple steps that don’t require any development skills, and at the end, you’ll have your data represented in Google BigQuery.
This enables you to leverage the full power of Google BigQuery on your BigCommerce store data — without taking on a big development project.
Not only is the integration good for merchants, it’s also good for developers because they can spend their time doing other things that will have a bigger impact on the business. For instance, they can create custom reports and scripting, find unique ways to slice and dice your data, or visualize data in new ways using business intelligence tools.
One of the things that BigCommerce has done really well is we’ve been investing in sample scripting and reporting, so all you need to do is change the variables and networks for your store. So we’re solving a lot of those most common use cases already.
How can merchants get started using the pre-built Google Data Studio reports?
So far, we’ve published three Google Data Studio reports: product revenue by category, cost of goods sold, and revenue by city. They’re a great solution for getting started using Google Data Studio with Google BigQuery. You can find them here in our Knowledge Base.
What’s particularly cool about the reports is that there’s a set-up instruction section showing how merchants can copy them, and once they do, it’s their report that they own. Then, they can follow a series of steps to swap out the sample data with their data. Now they have full control over the data and the reports.
Using these sample reports is a great first step in taking your BigCommerce data and leveraging it in a business intelligence tool, like Google Data Studio, to gain insights that can help drive your business. And once you have these first reports, you can build out your own reports to suit your particular needs.
How does BigCommerce’s open approach to data benefit merchants?
Our strategy across the board, data included, is to really maintain an open platform — what we like to refer to as Open SaaS. Merchants can use the best tools that meet their needs, and we aim to reduce any friction and make that process as easy and smooth as possible. And that’s the approach we’re bringing with our data solutions, which we’re calling Big Open Data. We believe this is a unique approach that nobody else is really doing.
To elaborate on what Derek said, generally, with other ecommerce platforms, it’s possible to take your data externally, but they don’t make it easy. For instance, some have very strict API terms of service that restrict where you can take your data. While others prefer that you use their intelligence tools, which may seem like a good solution at first, but you may find that you eventually want to build a custom report that isn’t supported. Many larger organizations often use more than one analytics or reporting tool, so being able to easily move your data into another system can make it easier.
The BigCommerce difference is that we give you control over your data, so you can get very granular with the types of insights you’re generating. You can also use the solutions that you’re most comfortable with and can provide the biggest impact on your business.
For example, your BigCommerce data can be passed through your instance of Google BigQuery, and then you can use your instance of Segment.com to start identifying your customers and building out their journey. And you own the data every step of the way.
Connect Your Data to Google BigQuery Today
For merchants already on the BigCommerce platform, you can get started with Google BigQuery right now by following these simple setup instructions. One thing to note is that this integration is only available for merchants on Pro or Enterprise plans. For merchants on Standard or Plus, you’ll need to upgrade to access Google BigQuery.
Additionally, you can explore all of our data technology partners to learn more about additional solutions for business intelligence, customer data platforms, personalization and more.
Within the B2B market, there are several metrics you can measure, analyze and compare. If you don’t want to get drowned in the sea of numbers and graphs, you have to know where and what to look for. Understanding which metrics to prioritize can help you refine your approach and increase your likelihood of converting customers and driving growth.
With that in mind, here are a few metrics we recommend tracking in order to make informed business decisions.
B2B Ecommerce Metrics
1. B2B Lead-to-Close Conversion Rate (CVR).
Conversion rate optimization (CRO) is the process of improving the shopping experience to drive a specific KPI — usually, sales. This is the best rate to see how successful your marketing tactics are as it measures the percentage of website visitors that convert to buyers.
A healthy conversion rate means you have a highly engaged customer base, and it is a sign of growth and success. If it is low, look to user-journey mapping to see where you’re losing site visitors.
Because B2B sales cycles often take longer to close than B2C sales, calculating your conversion rates and assessing the performance of marketing campaigns is even more crucial. That’s why it is important to keep an eye on these numbers throughout the entire year rather than a month-to-month basis.
2. B2B Initial Customer Acquisition Cost (CAC).
Acquisition metrics are focused on how effective your website and other marketing efforts are at driving people to visit your site. More than just generic traffic volume, acquisition metrics can help you dig into who’s visiting and where they came from — so you can better contextualize traffic numbers.
The customer acquisition cost (CAC) measures how much your company spends to acquire a new customer by looking at your marketing spend and how it breaks down per customer. This helps determine your brand’s total ROI for marketing and advertising. Having an active awareness of your CAC can help prioritize campaigns within your budget.
For some B2B businesses, it’s the only metric that shows how good (or bad) their performance and efficiency is. For others, it’s a clear indicator something is not done right. But these numbers can help you detect where you need to make some changes (program, campaign, initiative, channel, approach) and as a result it clearly highlights the positive and negative effects of those changes.
Marketing percentage of customer acquisition cost
This one is a mouthful and is a bit technical. However, it’s a very telling metric that shows how well your marketing team’s performance and spending is.
Essentially, the marketing percentage of your CAC indicates how much money marketing spends within a time period and how many new customers it generates. It gives you insight into how well your marketing program is functioning and can be used to make better sales and marketing decisions.
Marketing originated customers
The marketing originated customers metric gives you the chance to have a clear insight into how much your customer percentage has been gained through marketing. You might have invested in tools and techniques and therefore, you should expect your audience to grow consequently.
Understanding this metric and it’s calculation helps identify how many individuals found out about your business and helps you know exactly what to do next and how to do it better. This metric plays a role in helping your company grow and acquire new business.
3. Churn rate for B2B ecommerce.
The churn rate is a brutally honest metric that relates whether or not you have a viable business. Churn rate is a business metric that calculates the number of customers who leave a product over a given period of time, divided by total remaining customers.
This helps you determine the stage at which you are losing your customers and from there you can develop a strategy to improve the interaction with your product or service. Knowing the churn rate is important because it can be much easier and cheaper to have more returning customers than trying to attract new ones.
B2B Ecommerce Metrics Key Takeaway
If you are committed to improving your sales approach, you need to be tracking the right metrics. It is impossible to make an effective, informed decision without having the right metrics to guide you.
By tracking the above metrics, you can identify areas where you need to make changes and improve your overall sales approach. Depending on your business and your needs, there are several other metrics that can be measured, calculated, compared and changed to help improve your business.
For more information about B2B ecommerce, Imagination Media has prepared an information-brimming ebook for B2B merchants. You’ll learn more about metrics and the trends affecting them.
For over 30 years, Farmer Boy has been one of the leading companies in the agricultural industry, offering animal handling and housing, pest control, medications and protective equipment for bovine, swine, equine and poultry farms. Their customers range from large commercial operations and family-owned and operated mid-sized farmers to hobbyists who have a small homestead set up in their backyard.
However, Farmer Boy is not simply a transactional business. The company focuses on building long-term lasting relationships with their customers and within the communities where they operate.
Legacy Platform Limitations Stall Growth and Stifle the Brand
While Farmer Boy had an online presence, it didn’t represent the sheer number of products for sale, nor did it truly convey the value-added services the company provides to their customer base. Most importantly, the website didn’t promote the resources and knowledge that a multi-generational family-run business brings to the community.
“Our previous platform was very rigid, and we couldn’t make many changes on our own,” said Brian Marquette, Digital Marketing Manager at Farmer Boy. “There were also significant limitations to the website on our end, ultimately making the owners feel it wasn’t the look they wanted to give customers. We were ready to take that next step for the growth of the company by creating a website that looks fresh and new.”
Additionally, the platform couldn’t facilitate the kind of complexity typically required for B2B ecommerce. The old process created barriers between B2B customers and the final purchase, such as a consultation with a sales professional and a 2-3 day turnaround for the estimation and quoting process.
BigCommerce’s Flexible Framework Offers Farmer Boy Infinite Possibilities
Thus, Farmer Boy set out to find a solution that would support the advanced functionality and flexibility they needed to grow their business while enabling them to design an ecommerce website that reflects their commitment to their customers. With the help of ecommerce design and development agency Guidance, Farmer Boy was able to redesign and replatform its ecommerce website on BigCommerce.
“In order to provide a solid foundation for their newly redesigned website, Farmer Boy needed a cloud-based ecommerce platform capable of providing hybrid B2B and B2C functionality with full long-term scalability,” stated River Korn, Account Director at Guidance. “BigCommerce was the best choice for their regularly updated platform that provides full B2B and B2C capabilities and unlimited integration potential.”
BigCommerce’s seamless, out-of-the-box functionality and platform flexibility allows Farmer Boy to take more control of its brand and website. Marketing and product teams can quickly brainstorm and push out new products and promotions as they see fit, without waiting for the middle-man to make the changes.
“BigCommerce gives us control over creating the experience we want to give our B2B and B2C audiences, which is very important as we grow and start to compete with companies significantly larger than we are today. We can focus on both of these opportunities at the same time, with the same website, and we’re very quickly seeing the results of that investment in our website,” stated Marquette.
BundleB2B Enables Multiple Tiers of Buyers and Easy Ordering
Farmer Boy’s new ecommerce site needed to support an online ordering workflow catered to a B2B audience while providing self-service capabilities for buyers with specific roles and permissions.
Using Bundle B2B with the BigCommerce platform, Farmer Boy can easily manage its 2,300+ corporate accounts on the site and allow each company to set up multiple tiers of buyers within its organization with flexible roles and permissions, including company administrators, senior buyers and junior buyers.
For instance, company administrators manage all aspects of the company, addresses, and users, approve shopping lists, make purchases, and view company order history. Junior buyers, on the other hand, are only given permissions to create shopping lists and view company order history. Senior buyers have all the permissions of the junior buyer, in addition to approving shopping lists and making purchases.
Furthermore, sales representatives can log in on behalf of a company, access shopping lists created by buyers in the company, add products to the cart, and complete placement of the order.
BigCommerce’s Extensibility Creates a Connected Customer Experience That Drives Sales
Now, on Farmer Boy’s BigCommerce website, B2B buyers can find and research the products they’re looking for instead of relying on a salesperson. To facilitate this experience, Guidance created a navigation scheme that supports a newly created taxonomy and strongly advocated for an AI-powered search and recommendation solution.
So once the user has found a product and lands on the product description page (PDP), the newly created PDP serves as a true shopping experience with improved product descriptions and enhanced layout to truly inform the customer’s buying process. This eases the demand on sales and customer support teams, freeing them up for more strategic work.
Farmer Boy also has unprecedented access to B2C and B2B customers through Re:Amaze’s on-site chat solution, leading to helpful insights about customer behavior and increased sales opportunities. According to Marquette, “being able to chat with customers has opened up to more inquiries and sales, and we’re having conversations we weren’t able to have before.”
Additionally, B2B Ninja’s seamless integration with the BigCommerce platform allows B2B buyers to accurately estimate the cost of products based on their unique negotiated pricing, while sharing pricing and availability with the B2C audience. “Being able to fully transact and produce an automated quote based on pricing negotiated between the merchant and retailer completely changed the way Farmer Boy transacts with customers,” said Korn.
Farmer Boy Removes Barriers and Positions Itself for Incredible Growth
Overall, the move to BigCommerce has given Farmer Boy the flexibility to transact entirely online and has removed a barrier to entry into the online agricultural market. Since launching with BigCommerce, the brand has reported growth in sales, average order value (AOV), customer reach and more.
Farmer Boy opted to lean into its vision of the future and its desire to compete with significantly larger companies by expanding online. Competing with bigger retailers in the space, Farmer Boy is now equipped to scale its business from a firm foundation and pursue growth on its own terms.
“It’s a huge part of our goals to grow our parts and supplies business over the internet and expand our reach in the continental U.S.,” said Marquette. “Since releasing the new website, we’re reaching more customers than ever before and taking market share away from our competitors.”
As we approach a post-pandemic world and look back on all of the rapid changes that have happened over the past year, it becomes clear that the ecommerce landscape has transformed. For instance, by April 2020, the industry saw ten years worth of growth in only three short months. Ecommerce is now a more crucial channel than ever for growing brands.
Online shopping surged in 2020 due to consumers staying home in light of COVID-19. Many shoppers reduced their discretionary spend last year and prioritized essential items, which often fall into the consumer-packaged goods (CPG) category.
The ecommerce opportunity for CPG brands has never been greater, and with shoppers starting to trickle into stores more, the opportunity for CPG brands to thrive across channels and earn repeat customers is only increasing.
In this article, we’ll dive into how COVID-19 transformed the CPG sector, how CPG brands can thrive both online and in-store in a world shaped by the pandemic, and why now is a prime time for CPG brands to step up their strategy.
CPG Growth in 2020
Consumer packaged goods are any items that consumers use almost daily and replace frequently (including food and beverage, personal care items, and household products). In light of health and safety concerns caused by the pandemic, digital has surged as a safe and efficient way to get essential CPG items.
In fact, more consumers have been shopping for CPG items online. In 2020, nearly 55% of consumers have used direct-to-consumer channels to purchase CPG products or nonperishable items they use on a regular basis.
Smart CPG brands have been committing more budget than ever to digital advertising and other online initiatives. This year, US digital ad spend for CPG is expected to increase 16.4% to $22.58 billion after a minimal increase of just 5.2% in 2020.
Mobile accounts for 73.2% of all CPG digital ad spend. As a crucial channel that CPG brands can use to convert high-intent shoppers, mobile digital ad spend jumped 11.4% last year to reach $14.2 billion.
Social and video are two of the top opportunities for mobile. In fact, digital video ad spend was the fastest growing ad format for CPG last year. Video is also a smart play for CPG brands that are looking to venture into display advertising. Digital video ad spending will make up 28.6% of CPG’s overall digital spend this year.
COVID-19 + CPG: Just the Stats
CPG sales saw an $8.5 billion increase over the two-week period of March 7-March 21, 2020 and 35% more people were shopping online for CPG items. Online CPG sales increased 91% during that first week as COVID-19 restrictions went into place and consumers’ safety concerns started mounting. According to Nielsen, that’s 15x the category’s average rate of change.
Hybrid options like buy online, pick up in-store (also known as click and collect) have become popular among many consumers. In fact, BOPIS increased by 195% YOY in May 2020 due to the pandemic.
Year over year, click and collect sales surged nearly 107% in 2020 to hit a record $72.46 billion, and growth is projected to continue each year through 2024. By the end of 2021, click-and-collect sales are expected to make up 9.9% of all ecommerce sales.
2021 Ecommerce Strategies for CPG Brands
Products that are long-lasting, high-value, affordable, and available in bulk have become increasingly appealing options in light of COVID-19. Luckily for CPG brands, many CPG products fall into this category. If your brand falls into this category, how can you capitalize on the fresh opportunity?
Even as the pandemic subsides and the economy improves, price is a major buying factor for many shoppers. While many CPG items are essential and don’t fall under the category of “discretionary income” for many shoppers, other CPG items may be more “wants” than “needs.”
And it’s not just a battle to the lowest price point for the CPG brands that do sell essential items. In 2021, consumers want to know that no matter what they are paying for a product, they’re receiving value. CPG brands should keep this in mind for as long as economic uncertainty continues.
Some might argue that brand authenticity has also become even more essential as consumers place growing importance on a brand’s reputation, trustworthiness and ethics. The way shoppers perceive a brand can have a major impact on that business’ bottom line. Generating customer trust through brand authenticity will also produce invaluable repeat customers and long-term brand loyalty.
The digital CPG landscape continues to transform as the world recovers from COVID-19. In light of the pandemic, selling CPG items has introduced more challenges and opportunities than ever before. The brands that have a deep understanding of the current landscape and what draws in shoppers have an unprecedented opportunity to achieve unparalleled growth this year.
Ecommerce is having its moment. In 2020, it grew to $861B according to Digital Commerce 360. Every year, ecommerce accounts for more of total retail sales, hitting 21.3% of retail sales in 2020. That’s up from 15.8% in 2019 and 14.3% in 2018.
The trend is clear. People are buying online now more than ever. With lower barriers to entry and a continual flow of new entrants, competition is stiff. Retailers are bending over backwards to capture and keep customers.
“You can’t wait for customers to come to you. You have to figure out where they are, go there and drag them back to your store.”- Paul Graham, Y COMBINATOR
Every retailer is vying for consumers’ attention and spending power. With an ever evolving industry, the rules of the game have been altered. New channels emerge while others become insignificant. Hubspot says 71% of customers don’t trust sponsored ads on social networks anymore. So, if you’re not doing something new, you might be wasting your money.
The challenges don’t stop post acquisition. Once consumers walk through your “digital door,” getting them to buy something is a feat in and of itself. Online stores contain flexible UIs, detailed reviews, dynamic prices and customized offers. Even with these levers, only ~2.75% of customers complete a purchase on average.
Once you finish that rat race, it’s onto the next: driving repeat purchases. According to Clever Tap, the week 12 retention rate is 7.1% for existing users and a low 1.4% for new users. Single digit conversion rates across the board. That’s why companies are fighting tooth and nail for incremental lifts.
Merchants must provide customer-centric platforms that are differentiated, drive purchases, and improve customer lifetime value (CLV). Now, more than ever, ecommerce businesses must innovate and adapt or become irrelevant.
“Ecommerce leaders will have to keep with these changes (and others) to survive and stay ahead.”- Linda Bustos, Ecommerce Expert from Get Elastic
Get Ahead With Value-Added Services
As an example, Amazon, Walmart, Best Buy, and the big retailers, offer their customers lots of options and value-added services, such as payment plans, shipping insurance and product protection. Historically, these services could be hard to provide, so only large retailers could offer them.
Now, companies including Clyde, Route and Extend unlock value-add services for every retailer and their end customers. These technology-first platforms offer white-glove services out of the box. They have democratized payment options (BNPL, financing, etc), shipping insurance and product protection plans.
In particular, product protection plans can help build customer loyalty and increase a consumer’s intent to buy. For instance, Assurant found that extended warranties, on average, increase a consumer’s intent to buy by about 25%. Additionally, according to After, a positive claims experience can translate to higher lifetime value and higher propensity to purchase additional products and services.
What is Product Protection?
Products can be covered in a variety of ways. Many products have included manufacturer warranties that cover defects in workmanship for 6 months to a year typically, but product protection plans go above and beyond.
Product protection, also known as service contracts, guarantee a product’s working condition for an extended period of time. Product protection can come in many different forms:
1. Extended warranties.
These service contacts extend the duration of manufacturer warranty coverage. They start when the manufacturer warranty expires and then extend the coverage of mechanical or electrical malfunctions for a specified time.
2. Protection plans.
These service contacts protect products from specified damages or accidents. Each protection plan has different terms. A common plan is the accidental damage from handling (ADH), which covers damage caused by accidents like drops, breaks and spills.
With product protection, merchants can provide customers with more comprehensive coverage that can alleviate a customer’s fears at checkout. It’s important to note that plans are not mutually exclusive.
A great example is an iPhone; it can be protected in several ways. If your iPhone battery fails from a defect in manufacturing within the one year of purchase, that is covered by the manufacturer warranty.
But that warranty doesn’t cover accidental damage. So if you’re prone to dropping your phone, you might buy AppleCare, Apple’s protection plan. AppleCare offers accident coverage so you’re not paying out of pocket if you drop your phone and crack your screen.
Why Does Product Protection Matter?
Customers want product protection. This is evident by the $120.79 billion global extended warranty market size in 2019. This market is projected to reach $169.82 billion by 2027 according to Allied Market Research. There is clear market demand. That makes it a crucial element of your ecommerce experience.
Plus, offering a warranty can also help grow sales, according to Assurant’s Connected Decade survey. For video game consoles and set-top streaming boxes, including an extended warranty increases the likelihood of purchase by 22%. That likelihood increases by 21% for smart TVs and DVRs.
The value of product protection is obvious. The trend is clear. Consumers value extended coverage, which also unlocks new revenue streams and value for businesses.
1. Products are protected.
Extended warranty coverage gives consumers peace of mind. Additional coverage ensures customers will always have products they love that are working. Coverage can be personalized to customers’ needs for a given product, like animal biohazard coverage for appliances.
2. Quickly resolve issues.
Product protection improves the customer experience by turning a potentially negative product experience into a positive one. For example, with Extend, customers can chat with a virtual claims assistant 24/7 to provide a fast response and get replacement products out the door quickly — turning an unhappy customer into a delighted one. This high-quality service can facilitate stronger ties between customers and retailers.
3. Retailers can drive profits.
Product protection expands businesses by driving net profit, increasing conversion, and improving customer experience.
For example, SoClean partnered with Extend to enhance it’s strong reputation for providing great customer support. They wanted to ensure that, should something go wrong with their devices, their customers would have an easy path to navigate to getting things resolved. With Extend, SoClean was able to test their warranty offering. One experiment drove a 167% increase in revenue.
4. Increase purchase conversion rate.
Consumer confidence to purchase goes up when they see someone stands behind the product they are considering purchasing. Intuitively, it makes sense, customers like the extra validation.
In fact, product protection actually increases purchase conversion. For BlendJet, overall product purchase conversion rates increased 11% when the company started offering Extend product protection plans.
5. Improve customer experiences.
Great product protection improves customer loyalty by turning a negative experience into a positive one. In today’s environment, retailers need to give customers options. Ecommerce first saw this explosion with payments (BNPL, financing, etc) and now it’s seeing the rise of product protection.
Product protection also gives merchants a channel to bring customers back. For instance, when a claim is fulfilled at Extend, it drives customers back to the merchant site to get a replacement. Customers can purchase a replacement product, which will count as a net new sale for the merchant.
This multi-touch engagement strategy adds another meaningful touchpoint to the customer journey. Positive customer engagements, and turning potentially negative experiences into a positive, can lead to stronger customer loyalty.
Different Types of Product Protection
Product protection has been around for a century. Back in 1919 AIG was the first company to offer these plans to merchants. Until recently, product protection suffered from archaic claims processes and a distribution problem.
On top of that, claims processes could take months to resolve and often resulted in frustrated customers. New easy to use technology, like Extend, increases access to product protection, so any merchant, regardless of their size, location, or product catalog, can offer product protection.
Product Protection can also come in many forms:
- Replace – these service contracts work well with everyday items that may be relatively low in price. Think Skullcandy earbuds, it’s easier to replace a damaged earbud rather than trying to repair it.
- Repair – these service contracts are for items whose value is greater than the cost of labor. It makes more sense to repair a Peloton bike rather than replace it.
- Plan Duration – these service contracts simply extend the manufacturer warranty so consumers are covered beyond the manufacturer’s warranty period.
- Simple Product Protection – these service contracts allow for a little more customization. They often extend the duration of manufacturer warranty and may even expand coverage options. These plans kick in after the manufacturer’s warranty expires.
- Accidental Damage from Handling (ADH) Product Protection – these service contracts protect against more damage, like drops and spills, than a manufacturer warranty. Since they cover a different set of issues, these plans begin at time of purchase.
With so many options, merchants have the power to pick the coverage that not only fits their product but also fits their customers.
Uplevel Your BigCommerce Store with Extend
When it comes to retail, the future is written online. Online sellers face an increasingly crowded, fast-evolving field. Their success will require the ability to customize their offerings to best serve their customers. Retailers will need the resources to meet customers needs and open new revenue streams. Product protection plans empower retailers to differentiate themselves from competition, drive purchases, and improve customer lifetime value.
BigCommerce’s flexible, open SaaS platform makes offering product protection a snap. BigCommerce offers a simple pre-built integration to Extend’s API solution. This collaboration means every merchant can uplevel their online offerings and benefit from a protection plan program in no time.
It all started with a broken laser pointer. That’s the first item that Pierre Omidyar sold on his pet project website, AuctionWeb, in 1995. It sold for $14.83 to — believe it or not — a collector of damaged laser pointers.
This momentous transaction opened Pierre’s eyes to the untapped power of a public digital auction house. AuctionWeb became the ubiquitously-known eBay, and a mere two years later, the explosive startup received a cool $6.7 million in funding.
The site personified the adage, “One man’s trash is another man’s treasure.”
Fast forward through several acquisitions, rebrandings, and decades of growth, and we arrive at the eBay we know and love today.
But whether you’re looking to build an eCommerce empire on eBay or you’re just a casual seller, there are certain items you should never list on eBay.
This may be because they historically underperform, violate eBay’s terms of service, or carry with them headache-inducing regulations and certification requirements.
In this post, we’ll dive into the benefits of selling on eBay and a list of items that you’ll want to avoid selling at all costs.
Why Sell on eBay?
What are the specific benefits of choosing eBay as your ecommerce platform of choice? There are dozens of marketplaces to choose from — what makes eBay so special?
eBay has strong seller protection systems in place
Not only does eBay have secure payment methods, but also a responsive customer care team that can quickly resolve issues.
Sellers can report abusive buyers, quickly resolve unpaid items, and remove undue negative feedback to protect their online reputation.
eBay’s seamless integration with PayPal that dates back to 2002 means funds from a sale are not only secure, but immediately available upon a successful transaction.
1. eBay affords sellers access to a broad consumer base.
As of this writing, eBay’s official numbers boast a reach of 185 million global buyers. There are currently 1.7 billion live listings on the site. These don’t even take into consideration the significant SEO benefits afforded to eBay sellers.
Sure, you could create your own ecommerce site for more control. But why not ride the coattails of one of the largest, most trusted marketplaces in existence?
The bottom line is that eBay consistently rises to the top of search queries for used items. Sellers that build their ecommerce stores on eBay’s platform enjoy the benefits of their pedigree — including access to their staggering user base.
2. eBay offers robust tools for ecommerce operations of all sizes.
It’s a well-known fact that eBay is an approachable, easy way to make a few bucks on some used items. But eBay also offers some surprisingly powerful tools for sellers who want to build their entire business on the platform.
For example, the eBay Seller Hub is an all-in-one dashboard that gives sellers at-a-glance metrics on their performance, allowing them to make data-driven decisions in their business.
The eBay Store is a one-stop shop for a particular seller’s merchandise. In exchange for a tiered monthly fee, sellers have access to features unavailable to typical users.
3. eBay’s mobile app allows for efficient on-the-go selling.
Staying on top of selling eBay items, especially when you’ve got multiple concurrent listings, requires a lot of responsiveness
It’s simple and straightforward to snap smartphone pictures and upload listings straight to the platform. Also, monitoring watches, bids, and responding to buyer questions is as easy as responding to a text.
Serious eBay sellers can list and maintain their entire ecommerce business entirely from their smartphones.
Top 5 Items to Sell on eBay
If you want to know the most profitable items to sell on eBay, the method is simple — follow the search traffic. These are the top-selling items on eBay as of this writing.
1. Jewelry and watches.
Good photography is the key to profitable jewelry sales. This category is a favorite among sellers because of the products’ light weight (translating to low shipping costs) and high financial upside.
Jewelry is also an “evergreen” category that shows no signs of going away and isn’t subject to seasonality. Items in this category include watches, engagement rings, earrings, and necklaces.
2. Computers/tablets and networking.
Computers, tablets, and personal computing accessories often retain their value for many years. A used laptop, kept in good condition and wiped clean of personal data, often performs just as well as a brand new one, yet at a fraction of the price.
Items in this category include printer ink, video cards, laptops, netbooks, and computer replacement parts.
3. Cell phones and accessories.
The same principles that apply to computer sales apply to smartphone and smartphone accessories. The only difference is that smartphones are lighter and even easier to sell and ship, making them obvious candidates for eBay’s marketplace.
4. Video games and consoles.
Big gaming brands release their new consoles on a cyclical basis, rendering old consoles “obsolete.” So what’s a gamer to do when they need extra cash for the latest and greatest system? Turn to the internet’s favorite auction house, of course. Similarly to computers, video game systems can retain much of their value on the used marketplace if kept in good condition.
5. Clothing, shoes and accessories.
Second hand clothes and accessories make up a large portion of listings on eBay. Clothing is another example of an item that, when made with quality, has a long lifetime value.
And thanks to eBay allowing vendors to sell new products as well as used products, buyers can have the best of both worlds: rare fashion finds at a bargain bin price or fresh off-the-shelf essentials.
14 Items You Should Never Sell on eBay
Even though eBay’s legacy began with a broken laser pointer, the stipulations for “approved items” has gotten necessarily stricter over the years. The following list includes items you should never sell on eBay for a variety of reasons.
Some are flatly prohibited by eBay, others are a hassle to ship and process or just don’t perform well with the eBay consumer base.
Any way you slice it, stay well clear of the following 14 items when planning your eBay selling strategy.
1. Illicit items.
Let’s just get the obvious one out of the way. This is a catch-all for listings that are explicitly illegal, forged, stolen, or deceptive.
You don’t want to be selling drugs, stolen government documents, human body parts (yes, it’s been attempted before), or otherwise questionable paraphernalia.
eBay has a zero-tolerance policy on these items, and if caught, sellers may face steep penalties.
Anytime you’re shipping consumable products, you’re assuming more risk. Risk of spoiling, risk of getting customers sick, and liability with managing perishable inventory.
While eBay technically allows a short list of food items, their stipulations compounded with the risk make it too much of a hassle. If food is your thing, you’re better off trying a local farmer’s market.
3. Furniture or heavy items
One of the key things that novice sellers often forget is how shipping costs eat into profits. And this doesn’t just include the actual shipping charge itself, but all the requisite materials (boxes, bubble wrap, etc.) for shipping fragile items.
Bulky, heavy items such as furniture fall squarely into this category. It may seem like a good idea to sell that set of kettlebells or that small coffee table on eBay. But unless you want to pay a small fortune in shipping, you’re better off opting for a local platform like Craigslist or Facebook Marketplace instead.
While eBay does have some allowances for selling wine, it’s generally discouraged from selling anything in liquid form on the platform. This includes beauty products, beverages, or anything that has the potential of spilling or combusting during shipment.
Oftentimes, the potential reward doesn’t outweigh the risk of damage.
5. Items that require authentication.
eBay does allow sellers to list items that require authentication, but only after jumping through a series of stringent loopholes.
Items that require authentication include things like watches or sneakers. These things are often listed at a premium due to their rarity and personal significance, but the prevalence of forgeries means eBay has to be especially strict with sellers.
For these reasons, unless you have an ultra-rare, one-in-a-million item, it’s best to steer clear of this category.
6. Anything alive.
It’s alarming that this has historically been a real issue, but please don’t try to sell your cat on eBay.
In fact, anything alive (this includes plants) is better suited for local marketplaces or designated animal care facilities.
While eBay surprisingly allows the sale of bees, lobsters, and tropical fish (among other strange allowances), the burden is on the sellers to ensure safe, overnight shipping. That’s no easy task when you’re dealing with living creatures.
7. Items subject to recalls or legal safety standards.
You might think it prudent to flip an old crib or car seat once your child outgrows it, but it’s best to stay away from listing these items on eBay.
Due to the high risk associated with baby safety equipment such as baby gates, car seats, and cribs, many of these items are subject both to federal safety standards and frequent product recalls.
eBay expressly forbids selling used variants of the aforementioned categories (including used bike helmets), and even new items must be certified by the appropriate governing bodies.
The risk is too high and the hassle isn’t worth it. It’s best to avoid listing these items altogether or opt for a local marketplace.
8. Handmade items.
When building out your ecommerce strategy on eBay, it’s critical to know your market. Study the kind of consumer that looks for things on eBay.
A cursory look at the top-selling categories listed above will reveal that eBay is not designed for handmade, bespoke, or artisanal products. Sure, there’s nothing stopping you from listing those kinds of products, but don’t expect them to perform well.
Look again at the top-selling items and consider the question: “What is the average eBay consumer looking for?”
It’s clear they’re looking for practical, utilitarian items — not sentimental ones — at a discount. If handmade is your thing, you’re better off using a site that targets the appropriate demographic, such as Etsy or Amazon Handmade.
9. Firearm accessories.
While eBay strictly forbids the selling of firearms on their platform, they make certain allowances for firearm accessories. These include things like barrels, firing pins, and hammers. However, due to strict stipulations and various state laws surrounding firearms, it’s best to avoid eBay for this category.
Instead, opt for a local-based marketplace dedicated to firearms and firearm accessories.
10. Beanie babies.
This item makes the “avoid” list by nature of its pointed irony. Beanie Babies were one of the things that put eBay on the map. In fact, much of eBay’s early success was thanks to the incredible Beanie Babies Boom of the 90s and early 2000s.
Analysts even predicted that the online auction house would fail due to so much of its profits being propped up by the popularity of these cute little bean-filled creatures. Well, eBay obviously prevailed, and Beanie Babies were left in the dust.
They’re now relatively unpopular on the platform and can be purchased for pennies on the dollar.
11. Bootleg media.
It may seem strange to see this category on the list, as it seems fairly obvious that counterfeit or bootleg media would be prohibited on eBay. But the rules can get pretty gray, especially when it’s not as cut-and-dry as illegal copies of films or video games.
For example, there’s a thriving underground culture of Star Wars fans that make custom “fan edits” of the classic sci-fi movies and distribute them on DVDs. These are examples of items that, while not blatant copies, are still prohibited on eBay’s platform.
12. Digital or electronically delivered items.
The prominence of digital products such as online courses, eBooks, and software enhancements has skyrocketed over the past decade.
As a result, many entrepreneurs have found a way to keep their overhead low by creating completely electronic offerings.
To prevent intellectual property infringement, eBay has provisions on electronically delivered goods.
eBay’s demographic is all about buying used tangible goods. Selling digital goods on eBay is like trying to fit a square peg in a round hole.
If you’re building a digital product business, you’re better off looking into digital commerce platforms such as Udemy (for online courses) or Gumroad (for digital tools and software).
13. CB and HAM radios.
eBay is truly a hobbyist paradise. Whether you’re into fixing broken computers, collecting interesting musical instruments, or sourcing vintage antiques, eBay has something for everyone.
One popular hobby eBay cannot abide, however, is that of CB and HAM radio enthusiasts. According to their restricted items policy, “CB amplifiers and radio equipment that operate in both CB and HAM frequencies” is strictly prohibited on the platform.
14. Medical devices.
Medical devices such as Continuous Positive Airway Pressure (CPAP) machines and Electrical Muscle Stimulation (EMS) machines aren’t cheap. They’re also used to treat conditions that may be temporary, leaving patients with expensive hardware they no longer need.
Perfect candidate for eBay, right? Unfortunately, not. eBay strictly forbids listing these items or any medical item that requires a prescription.
You’d be better off looking into specialized sites that trade medical devices for cash.
Building Your Ecommerce Brand on eBay
One of the biggest skill sets of good ecommerce business leaders is the ability to choose the right tool for the job. This includes delegating the appropriate personnel to certain tasks and choosing the right online platform to meet specific goals.
Thanks to eBay’s responsive support team, their storefront and Seller Hub applications, and their wide consumer base, the platform has never been more viable for ecommerce business owners. But it’s not a one-size-fits-all platform. Doing a little bit of research on the front end will help you avoid listing inappropriate or underperforming products. Ultimately, what you sell is almost as important as where you sell it.
It’s no secret that running a retail business can be a challenging endeavor. There’s no shortage of decisions to make and costs to weigh, especially as you look for ways to continue to expand your store.
One way that brick-and-mortar businesses are growing is through adding an online store. After all, ecommerce is growing fast with global sales expected to reach $6.4 trillion by 2024. This explosive growth is in part because of the effects of the COVID-19 pandemic, which had a major impact on retail and customer shopping behavior. Retailers big and small closed their doors last year, with 12,200 stores shuttering in 2020 (for comparison purposes, 10,000 stores closed in 2019).
Meanwhile, in the face of these challenges, many retailers are also seeing opportunities. They can expand their brick-and-mortar businesses beyond the geographic limitations of their storefronts and reach new audiences and potential customers.
Taking your offline business online — or deciding to really invest in your ecommerce site for the first time — can be daunting. To that end, we have a number of resources available to help you get started and troubleshoot specific issues like integrating your POS system or understanding your fulfillment strategy.
But sometimes what you need is to hear from other business owners who have made the leap online, what worked and didn’t work for them and the advice they can give from the other side.
Kintec Finds the Perfect Fit Online and Off
Founded in Vancouver, British Columbia in 1991, Kintec is now a go-to source for specialty footwear and orthotics with 12 stores across Canada. They have also seen a huge increase in their online sales as they have made their ecommerce site an important part of their brand. In fact, their sales for Q1 of 2021 were greater than all of 2019.
The Kintec site is currently built on BigCommerce, but they previously used Magento as their ecommerce platform. However, on Magento they faced issues with site speed and reliability. Tyler Ireland, Marketing Manager for Kintec, explains: “It was a nightmare [on Magento]. We would be preparing for Black Friday and the site would crash, so we would have to get on the phone with our developer and point of sale integration. We were putting too much time and money into something that wasn’t fixable.”
They chose BigCommerce in part because it was recommended by the POS system they work with, NCR Counterpoint through iPaaS.com. They also were looking for a platform that could grow with them as the business scales.
Kintec is invested in making sure their in-store and online experience complement each other perfectly, so customers have a seamless transition between the two. One of the more innovative aspects of their in-store experience is Kintec’s 3D FitScan™ System. Customers step onto the 3D FitScan™ and within 5 seconds, it produces hundreds of data points that build a three-dimensional model of the customers’ foot. Once the scan is completed, Kintec runs the data through their database, powered by AI, to match it to shoe shapes to determine the best shoe for that customer. Kintec is currently working with BigCommerce to integrate this technology to their website so customers who start their Kintec customer journey in-store can continue it online.
Kintec’s top tips:
- Site speed can be a major differentiator when it comes to customer experience. Kintec saw a huge lift when they moved to BigCommerce and stopped seeing lags in page loads. Comparing their last four months on Magento to their first four months on BigCommerce, they saw an increase in site visitors of 44%. “Those numbers speak to the fact that consumers are enjoying our new site, and they’re constantly coming back,” says Ireland.
- Get help where you need it. Kintec utilized agency Weizen Young to help them build and continue to optimize their site. They appreciated the guidance in learning industry best practices and even what apps to download to support their strategy.
- Provide customer feedback and reviews. Kintec uses Stamped to manage their customer reviews. Ireland explains: “A good customer testimonial helps create an omnichannel experience from online to in-store. Even if they can’t try it on, they can know the newest Nike shoe is as good as the previous one; it’s that same fit.”
Gumbo Adds the Convenience of Online Shopping for Their Brooklyn Base
Gumbo is a boutique specializing in unique items from accessories to home goods and particularly kids’ clothing and toys. The name comes from the dish made famous by New Orleans, a combination of different flavors that come together to form an amazing meal. As owner Karen Zebulon explains: “That’s what my store is: it’s a lot of things in one pot. Culturally, I have things from all over the world. I have things for children. I have things for adults; it’s really a melting pot.”
Prior to the COVID pandemic, the store, on Atlantic Avenue in the heart of Brooklyn, was a gathering place offering classes, events and of course shopping. When COVID hit, Zebulon turned her focus to her online store. One of her biggest challenges in the past had been finding the time to invest in it. She did all of the design herself and appreciated that BigCommerce allowed her to easily change the template and move things around. “It was wonderful that I could just pick another format, press a button and then all of a sudden, my site, everything moved into place in a brand new updated format,” explains Zebulon.
Like many small business owners, she was also working around the clock so she appreciated BigCommerce’s 24/7 support: “If I was working at two or three in the morning, and I had a problem I couldn’t figure out, I could just pick up the phone and call, and somebody was always able to help me.”
Gumbo sells directly through its website and on a local online marketplace that lets people shop at Brooklyn businesses and get their orders delivered the same day. Local customers have embraced the Gumbo website because it allows them to see her products before coming in. Gumbo also set up a buy-online-pickup-in-store (BOPIS) option which customers have loved, particularly in the early days of COVID-19, so they wouldn’t have to enter the store. BOPIS and curbside options are a great way for offline to online businesses to provide added convenience to local shoppers.
Having an online store has also changed the way Zebulon runs her business. She says it’s provided her more insights into what people are buying and changed the products and quantities she orders. In terms of what’s next, Zebulon says she’s excited to continue building her online business to meet growing demand.
Gumbo’s top tips:
- Look for opportunities to expand your reach beyond just your site. Depending on your niche, this could be traditional marketplaces like Amazon or Walmart, but keep an eye out for unique opportunities as well. For Gumbo, finding shopIN.nyc (an online local marketplace for New York businesses) was a great way to reach a wider audience, while maintaining their shop local ethos.
- Find a platform and partners that can help you launch quickly and grow your business as you’re able. Zebulon was able to work on the Gumbo site incrementally and get support 24/7 along the way.
- Zebulon’s biggest piece of advice is to always focus on promoting your business: “Find as many ways as possible to direct people to your website. Include your business card with your web address in all in-person sales. Post frequently on Instagram and Facebook and use hashtags.”
Bead World Delights Hobbyists with Wide Selection and Fun Tutorials
Bead World began as a brick-and-mortar bead store in Phoenix, Arizona back in 2004 and soon expanded to a second location in Scottsdale. In addition to being a top location for beads and jewelry making supplies, they are also known for their high quality gemstones.
Kiara Thompson joined her mom, Karen Thompson, as business partner and Director of Online Sales in 2019 to build the online branch of the business. She initially considered Shopify, but ultimately chose to build the site on BigCommerce, in part because the platform supports large catalogues — important as beadworld.com has to date over 10,000 SKUs and growing! Thompson explains: “With making jewelry, you can’t just have ten different options. We need hundreds of options for colors, finishes and styles. The filters BigCommerce has are helpful for people to find what they need.”
Thompson says she appreciates BigCommerce’s SEO capabilities that make listing new products and getting them to rank easier.
The Bead World website launched in October of 2019. Just five months later, in March of 2020, the world changed and their business along with it. Due to the COVID-19 pandemic, their physical stores were temporarily shuttered, and their online business saw a huge influx in business. Shortly after the pandemic began, the number of orders quadrupled from one month to the next. Since launching their store, they’ve also grown their email list significantly.
Efficient fulfillment is important for customer satisfaction in any industry, but particularly for craftspeople and hobbyists eager to work on their projects. Thompson says they’ve received a lot of positive feedback on the site, particularly because of their efficient shipping through ShipStation. ShipStation also benefits the business because it allows them to get competitive shipping rates to make it easier to stand up against the larger bead suppliers. Local customers have enjoyed getting fulfillment even faster by utilizing the buy-online-pickup-in-store option.
One of the big challenges Bead World initially faced was promoting their store with new customers. Thompson explains they’ve leveraged Pinterest to help get the word out and used their blog to bring in beading enthusiasts. By regularly posting educational content like beading tutorials, they’ve been able to generate significant traffic. In fact, 30% of their traffic comes through social media, with 85% of that from Pinterest.
Another challenge they faced was getting people to buy beads online, as beads are something buyers would traditionally like to see and feel in person before purchase. Thompson said for their business, it’s been particularly important to take really true-to-life product photos so customers get exactly what they’re looking for.
Bead World’s top tips:
- Providing promotions and discounts can be a powerful tool not only for customer acquisition, but also retention. One of Bead World’s successful marketing tactics is weekly 40% coupons which consistently bring orders and keep customers coming back for more.
- Content is key. Doubling down on blog posts, sharing beading tutorials and then linking them on Pinterest has significantly increased traffic.
- Thompson offers this advice for businesses new to online: “Don’t be afraid to make a lot of mistakes in the beginning. The mistake you make when you are little will hurt a lot less than making the same mistake when you are bigger.”
Defcon Brings the Heat to Their Online Store
John Dilley created Defcon Hot Sauce after being a connoisseur of wing restaurants for years and deciding one day to create his own hot sauces to surpass what he’d tried. Starting in 2004, the business grew quickly and steadily, mostly through word of mouth and attending events.
Flashing forward to the present day, Defcon is available in all 50 states and 32 countries. While not a typical offline to online story because they never had a brick-and-mortar storefront, they have slowly pivoted their strategy from attending trade shows and farmers markets to letting their online store shine on its own, while still selling their products through wholesalers and on marketplaces.
When the COVID-19 pandemic began, many events Defcon attended were closed, but the site increased in sales. People were staying home and cooking more and loving that they could get a condiment to kick things up without leaving their homes. Defcon’s online sales increased 65% year-over-year in 2020.
John and his wife Maggie built the store on BigCommerce after they experienced site crashes and poor customer service on their previous platform. As Maggie explains: “BigCommerce was and is a breath of fresh air, and the customer service is a pleasure to deal with. It was a pleasure to set up as everything was self-explanatory, and very easy to use.”
Defcon’s top tips:
- Let your brand and products shine. Defcon doesn’t spend much on marketing now because they have firmly established their brand and can rely on existing customers and word of mouth. To get there though, they participated in events, hosted a radio show, shared recipes and offered other creative forms of content. BigCommerce also provides a number of marketing tools out-of-the-box to help you establish your brand and build a following.
- Dilley also stresses the importance of simplicity in the customer experience: “Make it as simple as possible. If you think you need all sorts of crazy options on your website, you’re probably wrong. People want to be able to order quickly and safely, and don’t need a bunch of bells and whistles to make up their minds.”
Adding an online store to a brick-and-mortar one can increase your reach, while also providing advantages to local customers. If you’re considering taking your offline store online, check out these resources to get started.
The BigCommerce platform is a great fit for businesses of all sizes looking to grow their online presence. Start a free trial to see if it’s a good fit for your brand.
The first use case of UGC was taken to collect information for the Oxford English Dictionary – as written in Simon Winchester’s The Meaning of Everything.
User-generated content is omnipresent in different forms and continuously affecting our decisions and psychology. The influence can be understood from a quote by Andy Crestodina.
“When you say it, it’s marketing; when your customers say it, It’s Social Proof.“
Rightly so, as social proof is the key to achieving more online sales and success.
The ecommerce ecosystem is expanding rapidly among all markets globally. The opportunities are also expanding for ecommerce brands; still, these brands struggle with major issues like brand trust, loyalty, cart abandonment, and conversion rate.
Consumers have become highly selective in their buying decisions and look for content that delivers necessary information, trust signals, and authenticity.
Branded content isn’t trustworthy, neutral, and authentic – it’s a well-known fact. Now here comes the role of User-generated content for ecommerce brands and its impact on shopping experiences.
So, what is UGC? How does it influence ecommerce? and what you must do to leverage users’ content on your ecommerce site.
What Is User-Generated Content?
User-generated content (or consumer-generated content) is the content that customers or social media users have shared based on their experiences, opinions, and decisions, mainly about brands or its products/services.
The user-generated content includes images, videos, ratings, reviews, gifs, audio, etc. – all forms of content that the users have shared.
UGC is popular as the most reliable, trustworthy, authentic, realistic, and insightful content driven by the consumer experience. Thus, it shows the real value and real-life experiences of a brand’s customers.
This is what ecommerce brands need from their content – Trust, Information, and authenticity.
So, the integration of user-generated content on ecommerce platforms is the best marketing strategy for ecommerce brands to turn their struggles into success.
Why is UGC Effective?
90% of the consumers believe user-generated content is more influential on their buying decisions as compared to the promotional branded content. Similarly, 2/3rd of the users believe UGC creates a more trustworthy and authentic shopping experience.
UGC can help the ecommerce sites develop a sense of authenticity and build trust among the customers towards the brand. It also helps create a closer relationship with the customers.
Visual content plays an important role in ecommerce sites, especially when it comes to product photos and videos. Now, branded visual content isn’t as effective – as it is one-dimensional promotional and boring photos.
However, user-generated content that features products is way more exciting, realistic, and creative. It gives an appealing view of products being used in real-life by real customers.
Along with this, the most common form of UGC, i.e. reviews and ratings, have been the key for ecommerce brands as they are quantitative and qualitative metrics about a products/service quality, value, worth, reliability, etc.
UGC + Ecommerce: 3 Types of UGC Fit For Your Online Store
User-generated content has different forms, shapes, intent, and styles but it is essential to identify which type of UGC will align with your online store to gain maximum returns through the UGC campaign
1. Reviews and ratings by customers.
In 1999, websites like eBay, Epinions, Deja and RateItAll allowed customers to write their feedback and reviews about their experience with the brand. That is how social reviews made the appearance.
Customer reviews help the ecommerce business show the world how credible they are and help them ensure customer satisfaction.
These reviews are valuable assets that help the brand analyze if their products and services are fulfilling the customers’ needs. If not, then with the help of UGC, they can analyze experiences and make the necessary changes and can also acquire new customers.
Not only sugar-coated and positive reviews, but even negative reviews help make a positive impact for the brand to grow organically.
Solo Stove is a great example of this. Its website allows fans to submit stories about their camping trips and other experiences with their products so other potential customers can see the product in action.
Do not restrict yourself from sharing user-generated content just on your ecommerce website. You can put these reviews, images, social posts shared by customers on your official website and across social media networks to enhance user-engagement.
Users will always embrace other customers’ opinions and find their word credible over the advertising by the brand. Including customer reviews in your ad campaign can improve the chances of fetching new audiences.
Testimonials given by the customers on ecommerce websites can improve the product’s image and make it more genuine. Use them to create alluring banners and advertisement campaigns that will push the customers to share their feedback on social media sites.
If the UGC is qualitative and impactful, it can increase the conversions and scale your ROI in the long run. Investing in UGC can transform the brand image and enhance its social presence.
2. Instagram’s visual UGC.
Instagram is the most popular social media platform – be it for the brands or the users. The reasons for this manifold where Instagram is making efforts to fulfil both consumers and brands’ needs.
Having 1.16 billion users in Q3 2020, Instagram has seen rapid growth in its active users. Moreover, the rising popularity of branded hashtags has led to Instagram becoming a hub of user-generated content.
Ecommerce brands and brands from the hospitality industry are leveraging Instagram UGC in their marketing campaigns.
Ecommerce brands have a huge potential as users are leveraging Instagram posts to discover products/brands, find inspiration, and shop for the products/services. The credibility to the earlier statement is given by the fact that over 130 millions users click on shoppable Instagram posts.
What is more mesmerizing is that 81% of these users search for products and services on Instagram. Simultaneously,50% of all people surveyed in the UK, France, and Germany have once visited a website after discovering a product/service on Instagram.
A growing trend among ecommerce is to create Shoppable Instagram and UGC feeds and publish them on their online store using a platform like Taggbox Commerce. These shoppable galleries work as inspiration for consumers to shop the look.
When you leverage UGC on Instagram, ads, or an online store, it is acquired legally with permissions. Also, make sure to filter and utilize the most engaging, appealing, and insightful UGC.
2. Posts from social platforms.
Besides Instagram, numerous social media platforms have billions of active users constantly uploading content in different forms like images, texts, micro-blogs, audio content, and more.
It’s not just Instagram that is beneficial for ecommerce and online stores; rather, social platforms like Facebook, Twitter, YouTube, Snapchat, Tumblr, etc., also offer growth prospects.
People love to share their experiences and opinions on Twitter in relevance to the brands and their products/services. They love posting snaps about their lifestyle on snapchat.
Facebook shopping is also becoming a trend since the inception of Facebook shops. Facebook is still a popular social platform with the most diverse user-generated content forms, including videos, images, stories, texts, audios, and more.
Skullcandy, a leading global brand in music accessories, implemented the Facebook shop feature by BigCommerce to reach the consumers and deliver a more seamless and quicker shopping experience through social media networks.
About videos, well! There are different platforms with different video content styles. YouTube majorly features unique user-generated content as video reviews, vlogs, etc. Whereas TikTok is a short-video user-generated content-driven platform.
With their unique content types, all these social media platforms feature user-generated content that is highly valuable for ecommerce brands.
Besides, Twitter reviews and Facebook reviews work as social proof for online stores to build authenticity, reliability, and trustworthiness.
Why Do You Need UGC For Your Ecommerce Store?
Explore a few of the many reasons why you must integrate the all-valuable user-generated content with your online store. UGC helps you tick all the boxes of your ecommerce marketing goals. Here’s how:
1. Increases your ecommerce conversions.
The superpower of users’ content is that it can be integrated anywhere in the ecommerce sales funnel – be it at the awareness stage, consideration stage, or decisions stage. UGC creates a complete journey to drive users towards a successful conversion.
One of the major reasons UGC is so highly influential on ecommerce conversions is that it is the most trustworthy, reliable, and authentic content in the marketing ecosystem.
Consumers look for trust signals while making online purchases, and UGC provides that perfectly with real information from real customers about the products/services. Consumers featuring user-generated content, be it reviews or visuals, can help consumers understand your brand’s credibility and explore customer experiences.
If you share user-generated content that talks positively about your brand, you can turn it into an inspiration for driving sales. You can even turn your UGC into a shoppable UGC gallery and allow customers to “shop the look” as seen in the UGC gallery.
9 out of 10 people surveyed found consumer-generated content influential when they intend to make an online purchase. UGC has an immense influence on the buying decisions of customers. Be it any form of user-generated content like reviews, ratings, images, or videos – all of it can attract and influence the ecommerce audience to buy products.
2. Build brand awareness and user-engagement.
Although the major goal is to increase ecommerce conversions, that isn’t possible if the user does not know about you or doesn’t engage/interact with your platform.
In a consumer buying journey, brand awareness is the first and foremost step. If people do not know about your ecommerce brand, there isn’t even a chance to get conversions and acquire customers.
User-generated content gives a perfect platform to build awareness about your ecommerce store. Social media is a UGC hub, and billions of people explore products, gain awareness, and gather information about new products and brands through user recommendations, customer reviews, visual UGC relating to the brand.
Building awareness leads to driving potential customers towards engagement with your brand. And engagement is undeniably a major objective of ecommerce marketing strategy as it is positively correlated to conversions.
Engagement of users with an ecommerce platform means the user intends to access information, make comparisons, and review customer experiences to form an informed buying decision.
Therefore, to drive maximum user engagement, you need to have fresh, original, valuable, and authentic informative content. User-generated content checks all the aforementioned necessary characteristics.
The integration of user-generated content with ecommerce becomes even more essential to sell the products/services as potential customers want to explore first what other customers are saying and their experiences.
So, to increase your ecommerce platform engagement, you must showcase visual UGC and customer reviews or ratings.
3. Enhance customer shopping experience.
Consumers highly value their shopping experience – be it an online experience or the offline real-life shopping experience. Any shortcomings or negative experiences can lead to a loss of potential customers.
However, delivering a seamless and exciting shopping experience digitally is a humongous challenge as consumer emotions can not be studied, unlike offline experiences.
User-generated content can be an excellent solution to building a unique digital shopping experience. Customer reviews on your ecommerce site provide a detailed and measurable quality metric for potential customers.
Will displaying UGC galleries on ecommerce work as inspiration for consumers who want to explore how the product would look in real life? How are other customers using it? Possibilities of that product, etc. Even further, making the UGC shoppable will help in turning users’ inspiration into conversions.
The buying journey will become more seamless, quicker, and insightful, where users can explore, evaluate, get inspired, and buy the products instantly without any break inexperience.
4. Humanize rather than marketing.
Gone are the days when marketing was all that was needed to sell your products and increase your revenue. But the time has evolved, and consumers have evolved with time.
Nowadays, consumers can easily differentiate between branded advertising and authentic information sharing. Retailers need to take a humanized approach to promote authenticity and reliable information about their brand and its products/services.
Unlike other forms of content, consumer-generated content builds a direct relationship with the customers. Created by users themselves, consumer-generated content humanizes a brand in the most simple yet unique way.
But how can UGC humanize your ecommerce campaigns?
The existing customers share User-generated content, so UGC campaigns will help connect better with potential consumers. They can easily relate to the thoughts of other customers.
Also, UGC helps in showcasing the community of a brand to potential users. Consumers can resonate with UGC as it shows better relevancy, humanized emotions of existing customers, and their real experiences – making your campaigns more “HUMANE”.
In short, humanizing a brand boosts its value in the market and grabs the attention of the customers.
5. Builds content in your library.
Content is a key component of an ecommerce platform as this will engage and convert the leads into customers. The content on your ecommerce platform needs to be planned and created for the consumers and not your marketing purposes.
Creating content is a tremendous task that requires regular investments into research, resources, time, and content creators. Moreover, content creation is a consistent process requiring consistent expenses.
The best alternative to branded content is – user-generated content. Social media is a hub of users’ content. With platforms like Taggbox, you can easily collect, curate, customize, and publish UGC on your ecommerce website.
Having UGC at your disposal helps you reduce content creation costs like product images and videos for your ecommerce platform.
The UGC is like a stream that flows continuously to give you new, fresh, original, and valuable content for your UGC campaigns. You can collect all your valuable content and build a UGC hub for your campaigns. The best part is UGC campaigns work like a chain reaction where they help in generating more user-generated content for your brand.
6. Inspires brand loyalty.
Aggregating the relevant and qualitative UGC from various social networks is termed social proof. It is credibility provided by the consumers about a brand’s authenticity, reliability, and trustworthiness.
Social proof like testimonials, product images, selfies and videos shared by the users is the effective marketing strategy to attain more audience.
People will follow the customer’s feedback and not branded content. Also, it develops the trustworthiness of the brand in the new users and retains loyal customers.
Brand loyalty is priceless in this competitive ecommerce ecosystem. This makes user-generated content even more valuable than it already is. Those customers who share positive content about your brand publicly are your brand fans. These people are more likely to make repeat purchases with your brand.
The content shared by loyal fans can include product reviews, testimonials, satisfying customer experiences, product images or videos that showcase your brand’s premium quality, value for money, and happy customers.
This type of content attracts new customers and creates a desire to be associated with your brand. Building initial brand image and delivering satisfying experiences leads to fostering brand loyalty, community-creation, and maximum customer lifetime value.
Promoting user-generated content also highlights the transparency and confidence of a brand in its customers. This way, UGC inspires brand loyalty by showing how highly you value your customers.
Example of an Ecommerce Stores Using UGC to Their Advantage
Skullcandy has a creative content marketing strategy on their BigCommerce website. Their marketing strategy revolves around creating content with high visual appeal, subtle product display, and showcasing experiences and ideas.
Along with creative branded content features, the customer reviews – a necessary form of user-generated content essential to help increase conversions.
Customer reviews have existed for a long time on ecommerce websites, and they are getting more important than ever. No matter how exciting and engaging your brand campaigns are, UGC like customer reviews are important to turn a consumer into a customer on ecommerce.
Skullcandy has included these customer reviews on their product pages. The flow of content from top to bottom, starting from product images to its key features and summing it by social proof through reviews, helps consumers make an informed decision.
How Can You Leverage UGC For Your Online Store?
An amazing part about UGC is that it is not restricted to any particular brand or any industry. One of the few restrictions around UGC comes from the customer experience that you provide to your users.
UGC works the same as Karma; you get what you give.
The other restriction is that you need to have a big enough customer base (who are satisfied with your services) to generate positive content based on their customer experiences.
Not millions or thousands, even hundreds of loyal customers, can generate enough UGC for your ecommerce to create and run UGC campaigns.
1. Analyze Your Audience.
The first step to leveraging UGC to enhance your ecommerce sales and experience is to analyze who your audience is, which digital content sharing platforms they use?
You will mostly find your audience on social media platforms, which is the best place to leverage user-generated content. Social media is the place where users can easily interact and engage with your brand.
Along with social media, you can even find opportunities on different platforms driven by user-generated content like Yelp, Google reviews, Airbnb reviews, etc.
2. Analyze your competitors and industry.
Competitors are great teachers too. If you have competitors or players from the industry who are also leveraging user-generated content, then you can take inspiration from them.
Find out how they have integrated UGC into their ecommerce marketing campaign. Learn how they are curating UGC from which platforms? What type of customers share content most regularly? What type of content is being leveraged by them and more.
3. Create your ecommerce UGC campaign.
Once you explore the market trends around UGC and where you can find UGC, then comes the time for you to create a UGC campaign.
First of all, if you don’t have UGC currently, then you can leverage different tactics to generate UGC, like running hashtag campaigns on social media and gamification campaigns that lure customers to engage and contribute content in return for rewards, gifts, vouchers, discounts or even the chance of featuring in your campaigns.
To get started with your UGC campaign, you can leverage a UGC platform like Taggbox, which will help you collect, curate, and publish UGC for your campaigns. Also, you can create direct submission channels like Passion Planner, where users can directly submit their content, be it reviews or visuals, to your platform.
Using a UGC platform is the best option. It single-handedly helps you create and publish UGC campaigns that save time and massive investments. You get complete solutions from collecting UGC from diverse platforms like social media, reviews platforms etc.
You can then customize the collected content with themes, layouts, designs, colours, and many more options to give a direction to the content and instil your campaign plan.
Furthermore, if you intend to make your UGC shoppable, you can tag products to the UGC gallery or even get the UGC rights directly from the users and leverage UGC without any restrictions.
Finally, publish your UGC campaigns on your ecommerce platform to build social proof, drive sales, and enhance the customer experience. The UGC can be leveraged on social media campaigns, emails, social ads, offline channels, and more to create a complete ecosystem.
User-generated content in all and any forms influences the consumers’ shopping psychology. This presents an immense opportunity for ecommerce brands to leverage UGC to enhance their ROI, growth, and shopping experience.
It is the perfect time to get started with UGC campaigns for your ecommerce brand. Take inspiration from the examples, review the benefits you can achieve, and build your ecommerce UGC campaign.