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Year-Long eCommerce Research: What Channels Drove Revenue?

Significant differences show how the same channels can speed up or slow down growth for mid-sized and large online retailers

Year after year, organic search, paid search, and email make up a vast majority of revenue. Noteworthy reports such as Custora’s eCommerce Pulse mentioned that 20% of holiday revenue came from email. After measuring the largest channels, the next step was to figure out if each channel actually helped increase overall growth. Did the medium hurt business even if the medium’s share of revenue increased? Did channels such as organic search detract from, maintain, or improve an online retailer’s livelihood? What did the top performing retailers do differently? Curious to see if your marketing plans look similar or are very different from our year-long benchmark of results from online retailers? Read on.

eCommerce Growth Attribution

The most successful retailers made frequent, profound site-wide changes to enhance the shopper’s experience. While net new traffic is still important, the improvements made to the sites focused on the quality of conversion and how the site-wide experience touched each of the highest performing marketing channels.

Organic and Paid Search

The profits on organic search were much greater than the returns from paid search. How did online retailers make out with search marketing?

    • Top retailers saw traffic from search engines play a significant part of their marketing activities. High performing businesses made modifications deep into the HTML page structures far beyond surface level display changes and leveraged the power of navigation. Not only did eCommerce sites see direct organic search benefits, the gains from remodeling structural elements reached across multiple channels. Improved page structure yielded the best organic and paid search ROI especially on the product, sub-category, and results pages. There are many interesting navigation questions to test and optimize, for example: Should the most frequently accessed or seasonally popular sub-categories or products come first? How does your shopper and search engine know where to go next? If there are dozens of results, would an additional category page make sense instead of a filter?
    • On another note, attribution is challenging if your shopper interacted with both organic and paid search to browse and refined their results. Often the last touch gets more credit for the sale, even if the past ten interactions provided more value to the shopper. One way to better balance attribution? Add session length statistics to counterbalance single-sided conversion metrics.

Direct Traffic

Did your site engage or lose shoppers who directly entered your site?

    • The fastest growing eCommerce sites continued to optimize usability post-launch, whereas the slowest growing businesses launched but failed to continuously improve the site after putting out a new feature or design.
    • The average retailer in between the two extremes most likely saw the minor erosion of direct traffic give away to shoppers who searched for the brand's name instead of directly typing in the URL.
    • Usable, not just responsive: a redesigned responsive eCommerce site without usability in mind can be a recipe for disaster. After going live with a responsive site, there’s constant refinement and testing to improve the formula for usability and conversion. There could be a significant drop in post-launch revenue if the checkout process did not get much attention as it should have during a responsive redesign. One retailer even started their responsive web design project from the end of the conversion funnel. The story of how Shawn Lowe, Web Administrator, helped Agri Supply grow 20% may inspire you to explore how continuous steady improvements can help business growth.

Email Marketing

Email had the highest channel ROI; and we saw creative methods for existing shoppers to refer new shoppers via email.

    • Retailers who saw higher revenue gains ran more email tests and had a fuller calendar of relevant promotions. Rather than offering flat discounts on single items, businesses achieved success by promoting trending products, offering discounts on larger orders or higher margin products, and provided free expedited shipping on items that required more urgency.
    • Triggered emails continued to be a significant part of email marketing. Sophisticated marketers tested the conversion rate of re-engagement emails to determine how to best position a series of nurture emails in various situations such as abandon cart, post-purchase, pre-purchase research, and the win back of inactive customers. Retailers also built address book and calendar functionality to work with their orders and email confirmations for multi-recipient shipping which helped convert shoppers in the busiest seasons.

Referral Marketing, Display, and Social Marketing

    • Referral partners performed well for retailers across the board; high performing retailers were not doing less to drive referrals, but rather other channels contributed more to growth.
    • Display advertising has been challenging for conversion; marketers may see it as more of a brand awareness medium rather than a direct revenue generating channel.
    • Social media is a fascinating channel for retailers to engage fans. However revenue-wise, social is still not a top player. Social loyalty programs made a dent in conversion, yet online retailers did not see Facebook or Twitter as a primary revenue generator. We are curious to watch over the next few quarters if social marketing will be a mover and shaker in the industry.

Figuring Out the Right Multi-touch Combination

In our research, there isn’t a channel that completely dominates growth for the top performing mid-sized and large retailers. If you’ve found a mix of gold and silver bullets that’s worked for your eCommerce business, please do share the details in the comments below. The right digital retail marketing mix is a sophisticated concoction; unique for each businesses situation, and ever-changing due to external forces from the industry and internal resources available for investment. The results over the past 12 months rocked, and we are looking forward to seeing more online retailers grow much faster than the industry average. 

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