Believe it or not, it's possible to build a six-figure ecommerce brand in less than a year. … [+]
Making a significant amount of revenue every month is the dream goal for anyone starting their own ecommerce brand. Unfortunately, many brands never make any sales. In fact, Practical Ecommerce estimates that the failure rate of ecommerce brands is 80%.
Despite this staggering statistic, starting a six-figure e-commerce company is by no means impossible, which became abundantly clear in a recent interview with Levi Feigenson, co-founder and CEO of Mushie.
Feigenson and his wife launched their eco-friendly toddler accessories brand in July 2018, and made $27,800 in revenue in their first month of business. The brand has seen incredible growth over the past year, and is on track to do about $450,000 in sales this month.
So how has Mushie achieved such an impressive growth rate in a relatively short period of time? While high-quality products certainly played a role, much of its success is due to a few key e-commerce sales and marketing strategies that other e-commerce retailers can learn from and implement as well.
Leverage influencer marketing
On the marketing front, Mushie has seen its biggest growth through influencer marketing. “Instagram is a key platform for us,” Feigenson said.
He continues, “When we first started, we reached out to hundreds of influencers. We sent our products to micro-influencers with 4,000 followers, but also big-name influencers like Jenna Kutcher and Cara Lauren, who have over 800,000 followers. This allowed our products to be seen by millions of people.”
Whether you're working with a big influencer or a small micro-influencer, looking for individuals who have a more authentic way of marketing your product and the right target audience is essential to a successful collaboration.
When done right, it can produce amazing results across a variety of industries: A case study from Silk Almond Milk found that influencer marketing campaigns delivered 11 times the return on investment of digital banner ads; households that viewed influencer marketing materials purchased 10% more products than those that did not.
You don't need Kardashian-level influencers to get these results. Finding the right influencers in your niche and developing authentic collaborations through a variety of deliverables, such as Instagram posts and stories, guest blog posts, podcast shout-outs, and YouTube reviews, will grow your reach over time.
Sell offline using wholesale
“While you should never ignore your individual customers, we've found that in our niche, there are a lot of stores that want to have our type of product on their shelves. Even though the end customer isn't buying directly from us, it's also a great way to increase exposure in an offline environment,” Feigenson explains. “Even better, selling to retailers has the advantage of being able to sell a large volume of product in one transaction.”
In the wholesale market, retailers buy products in bulk, usually at a discount than they would if they were selling the products individually. The discounted prices are lucrative for the retailer, but the potential exposure (and repeat customer benefits) are a big benefit to your brand.
Retailers have the distribution networks and resources to get e-commerce brands' products on store shelves, which is more important than you might think: many articles have been written claiming that brick-and-mortar stores are in decline, but in the U.S., e-commerce accounted for just 13% of total retail sales in 2017.
Although e-commerce sales are growing rapidly, brick-and-mortar sales numbers are still increasing, up 2% from 2016 to 2017. As a result, getting products in stores today can help brands drive even more sales online tomorrow.
Unleashing the power of Amazon
Although Amazon's e-commerce market share has declined due to a rise in competitors, it is still expected to account for approximately 38% of all e-commerce sales in the U.S. in 2019. With billions of orders placed every year, it's clear that there is a significant potential customer base on the company's platform.
This has led Mushie to enter the Fulfillment by Amazon market.
“Fulfillment by Amazon has been extremely helpful in expanding our digital sales,” says Feigenson. “Not only has it alleviated inventory concerns, it has given us access to a vast new customer base and a marketing tool to reach even more customers on and off Amazon – it's an incredibly valuable sales channel.”
Research shows that Amazon advertising helps with the buying process from start to finish. In fact, USA Today reports that “55% of online shoppers start researching a purchase on Amazon.” As The New York Times also reports, Amazon's superior customer data allows advertisers to better target customers who are likely to purchase their products based on their past purchasing behavior.
But perhaps most importantly, individuals browsing Amazon are already considering a purchase. This significantly increases the potential ROI of Amazon advertising because your target consumers are no longer in the discovery stage of the buyer funnel, but are ready to buy, resulting in more valuable clicks and higher conversion rates.
While there is no denying the importance of a website in the growth of an e-commerce brand, Mushie’s example clearly shows that a website should not be your only source of income.
By improving your marketing strategies and generating new revenue streams, you'll be significantly better positioned to increase sales and build a lasting brand.
