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E-commerce is an opportunity
Working in e-commerce is an opportunity in itself. Simply keeping up with the market can guarantee 16% growth in 2019. But it doesn't stop there… Research conducted by the BigDataCorp consultancy and PayPal shows that between 2018 and 2019, after two years of moderate growth – 9.23% in 2016 and 12.5% in 2017 – Brazilian e-commerce experienced its greatest expansion since 2014, increasing the number of online stores by 37.59%. Now, there are about 930 thousand websites dedicated to e-commerce, the majority of which (59.76%) use closed platforms – generally free.
“E-commerce spent two years with more modest growth rates. The crisis caused many initiatives to be postponed. What we see today, however, is that everything that was held back in the past flowed out strongly between 2018 and 2019. Once again, e-commerce is becoming an option for those who want to start a business in the country,” says Thoran Rodrigues, CEO and founder of BigData Corp.
E-commerce in Brazil
E-commerce practically tripled its share of the total Brazilian websites since 2015. Since then, it went from a mere 2.65% share to the current 7.04%, proving its growing importance.
Small websites, with up to 10 thousand monthly visits, dominate the scene today and, with the entry of more than 250 thousand new online stores in the last year, increased their share from 82.48% to 88.77%. Medium websites, which receive between 10,001 and 500 thousand monthly visits, saw their share drop by more than 7 percentage points, from 9.99% to 2.58%.
There is still room for new entrants
But Brazil is still 5 to 10 years behind other countries such as China, England, Japan, and the USA, which passed the 10% mark of e-commerce in global retail. What happened there will happen here, so we must anticipate and be structured for this change in the retail paradigm.
The average lifespan of an e-commerce store has more than quintupled since 2015: four years ago, online stores remained active for an average of three months (about 94 days); today, e-commerce businesses in the country last an average of 487 days, or just over a year and four months.
How to do it?
To start, you need to build a clear plan, with marketing actions and a technological structure that is aligned with the budget, the expansion plan, and the company's business model. Without this, your online store will do like the majority of stores and close after just over 1 year.
You need to structure a lean and profitable operation. This means lower costs with physical structure and staff, and more efficiency with logistics, customer service, and billing. Since there is no magic formula that works for all types of companies, the entrepreneur will need to align the individuality of their company with the model we call Scalable DNA.
An e-commerce with Scalable DNA
But what is Scalable DNA?
Just as our human DNA determines the predisposition we have to evolve in a healthy and wealthy way, every company has a corporate DNA that determines if, and to what extent, it can grow. Unfortunately, science has not yet been able to modify human DNA, the good news is that corporate DNA is completely modifiable and adaptable.
It is possible, for example, to take the DNA of a slowly growing company and replace it with the DNA of a fast-growing and scalable company.
To structure an e-commerce with Scalable DNA, you need to:
- Present scalable opportunities by evaluating the environment and competitors to increase consumption potential
- Organize the operation to serve well and deliver quickly during large sales peaks
- Develop a scalable e-commerce strategy with highly automated activities
- Analyze all user data and interactions to generate insights and optimize actions
Detailing Scalable DNA
The scalable structure offers conditions for a company to grow uniformly or to support an increase in demand, raising the company's revenue without its expenses suffering an equivalent increase. Hiring a team to deal with busy periods generates liabilities and high costs incompatible with the other low sales periods.
We detail the Scalable DNA in 4 very clear steps:
1st seek scalable opportunities
Evaluate the environment and competitors to operate in a market niche with great consumption potential.
- E-commerce models: B2C, B2B, B2B2C, B2E, C2C, Trade, EDI, and many other ways to implement an e-commerce that generates value for your business;
- Seeking opportunities: evaluate your competitors' strategy, discover the media with the greatest potential, and how your niche decides to buy;
- E-commerce Market: know the trends for e-commerce, consumer profile, buying behavior, and outline your initial strategy.
2nd build a scalable operation
Organize the operation to serve well and deliver quickly during large sales peaks.
- E-commerce Platform: know the difference between platforms, which features will help or hinder your daily routine, and if it will serve you in the long term;
- E-commerce System: besides platforms, you need to choose from hundreds of suppliers with different solutions: payment, logistics, marketing, etc.;
- E-commerce Tools: know how to choose each tool in a way that generates more revenue, automates activities, and improves the experience;
- Operating Models: conduct an analysis of which activities and resources are important to internalize or outsource in a way that generates savings and better quality;
- E-commerce Operation: structure an e-commerce operation that delivers quickly, serves cordially, and solves problems without friction.
3rd develop a scalable strategy
Develop an e-commerce strategy with highly automated activities.
- E-commerce Management Framework: apply to your e-commerce the methodology that gives a complete view of your store and indicates what the strategic failures are (learn here);
- E-commerce Tactics: know the main tactics adopted by large players to increase their revenue: cashback, collabs, affiliates, influencers, and marketplaces;
- Action Plan: with the entire strategy drawn, it is time to manage the execution with your Quarterly Plan, using the methodology of the E-commerce Management Framework.
4th capture data for analysis
Store all user data and interactions to generate insights and optimize actions.
- Data-driven Management: numbers do not lie, therefore you need to organize an information system to provide all the insights necessary for decision-making;
- Top 3 metrics: know what the 3 main metrics you should monitor are and what actions you can take to improve your indicators in search of growth.
This is what we want to deliver to you in the E-commerce Immersion, advanced digital marketing strategies for you to implement, accelerate, and scale your online store.
I hope to have clarified many doubts, so get to work!
