Who hasn’t made an unplanned purchase when at a brick-and-mortar shop- picking up a Scrub Daddy from an end-of-aisle display or a favorite candy at the supermarket checkout? Online, we call this the Transaction Moment －a state of mind consumers enter during the purchase journey when engagement and buying intention are at their highest. Said simply, it’s a vital opportunity for brands to connect with individuals who are ready and willing to buy more.
As opposed to the supermarket you grew up with, e-commerce retailers have the opportunity to move beyond one-size-fits-all marketing to create smarter – more profitable – conversations in the Transaction Moment. Leveraging data and smart tech to surface the most relevant and effective upsell offers to each individual has been seen to increase profits by over 50%. Despite this opportunity, many brands have not yet taken these necessary steps.
Interested in transforming your e-commerce marketing? Here’s how.
Understand your Value per Transaction
All successful businesses must find a balance between generating short-term revenue and long-term profitability. When it comes to upsells, is it better to secure an additional purchase today – or – drive an action (such as an App download) with the potential for bigger returns several months down the road. It can often be easy to favor the immediacy of today’s conversion and revenue – without fully understanding the long-term profits you are sacrificing with each transaction. It’s essential e-commerce companies consider these trade-offs and use technology solutions to dynamically determine the best offer for each individual user.
Value per transaction (VPT) is a new metric that facilitates the analysis of conversion rates and value between long-term and short-term profit drivers. VPT empowers businesses to gain the highest value from each stage in the transaction – not just the quickest.
Take an online retailer implementing a VPT-maximizing strategy, in this case, on its order confirmation page. The retailer recognizes the value of the confirmation page as a piece of online real estate to sell more in the near term, as well as the opportunity to build long-term relationships by encouraging sign-ons to their loyalty program. Using VPT to examine the conversion rate and profit driven by each, the retailer is able to best prioritize their marketing efforts.
For further information on how to calculate Value Per Transaction, download our whitepaper: Anatomy of the Upsell.
Put people before product
Consumers are much more receptive to tailored offers and communication, meaning personalization is the name of the game for marketers. But many e-commerce brands limit offer personalization to the product level. These recommendations are typically based on purchases other similar customers have made, often ignoring the actual needs of specific customers.
Take, for example, a person buying a gift for her young niece’s birthday. At this stage, she is unlikely to need further toy suggestions delivered to her in the purchase journey, despite the fact the majority of people who made the same purchase went on to buy these products. She may, however, be interested in suggestions for a new dress to wear to the celebration.
Recognize not all customers are the same
As noted above, the focus during the Transaction Moment should be on the customer. Central to this idea is recognizing that not all customers are the same. E-commerce brands have access to a wealth of contextual, demographic, and personal data gathered from customers throughout their purchase journeys. Machine learning allows this information to be quickly analyzed, building an ideal foundation from which to craft individually relevant offers and messages that are presented at the optimal time. Using this approach, Rokt AI has been found to drive a 7x increase in engagement.
By starting smart conversations, e-commerce companies can transform their marketing strategies into effective, efficient value-driving machines.
|The travel industry leads in driving ancillary revenue through upsells. For a more in-depth look into smarter e-commerce marketing, including insights from global brands, download our latest paper: The Anatomy of the Upsell: Making the Most of the Travel Transaction Moments.|