3 online retail strategies for a reduced marketing budget
For retailers, the current climate has meant slashed budgets while still trying to keep online operations smooth in order to meet customer demand and increase revenue. However, with a reduced marketing budget, how do you find those customers and keep conversions up?
Your retail goals right now should be to increase revenue and improve profitability as a whole, while still keeping costs down. In this article, we’ll cover how you can use your performance data, current trends and AI-driven technology to improve your online retail operations on a reduced marketing budget.
1. Identifying best and worst-performing products within campaigns
As a business, you need to have full visibility over which products are selling well and which are not — at SKU, product line and product category level. Understanding your product performance at SKU level is especially important when you have a reduced marketing budget as it allows you to identify where you’re making the most return on your investment.
Traditional report software such as Tableau or even a retailer’s Google Shopping account doesn’t provide the granular visibility over your data that will allow you to make informed decisions. In order to get this visibility over your product performance, the right AI tools can help you collate this data and gain an overview, allowing teams to prioritise the best selling products and reshuffle products that aren’t doing so well). Here are some ways AI tools can help.
Utilise data with right AI tools:
- Use your collected data to determine your best and worst-performing products. This will allow you to make data-driven decisions based around inventory and marketing.
- Prioritise the best-performing products and push these to customers.
- Reduce expenses by discontinuing underperforming products.
- Choose Key Performance Indicators (KPIs) that align with your campaign goals e.g. looking at your organic traffic, online landing page conversion rates, and RoAS or ROI on individual marketing campaigns. Make sure your KPIs align with your department goals (Reducing CPA, increasing conversions) alongside your company goals (increasing revenue and maintaining profitability).
Having one centralised point for all of your performance data empowers you to be able to make data-driven decisions. This greater visibility allows individual departments to have a better understanding of how the metrics they’re using are driving success for the company overall. This data can also be reviewed alongside key business metrics and trend data to give you a full picture of your performance.
2. Understanding your changing purchasing behaviours
Keeping up with current trends in the industry is vital. But keeping up with trends among your customer base is even more important. Knowing what your customers want and adjusting accordingly to meet that demand will ensure you stay ahead of the curve, and remain profitable.
You need ecommerce software that tracks your customers’ buying habits and spots trends and patterns and provides actionable insights — something that typical software doesn’t provide. The right kind of AI tool allows you to harness your data and better tailor your retail strategy to what your customers are looking for in the moment.
Utilise data with AI tools:
- Centralise your data and find patterns to pinpoint what your specific customers are looking for at SKU level and adjust campaigns accordingly.
- Push the marketing on the best performing product categories in your industry, such as coronavirus shopping trends. This recent report indicated that for Fashion brands, sleepwear and loungewear saw an increase in sales, as did Outdoor furniture for Home brands. This data should be utilised and compared to your own product performance data, and if needed you can make necessary tweaks to match consumer demand.
- Pro tip: The right software — such as Upp — makes it easy to adjust which items you want to prioritise based on your customers’ demands, which means that you’ll be getting the most out of your reduced marketing budget.
- Use location targeting to increase customer engagement.
3. Find the balance between revenue and margin
Although retailers will be prioritising revenue spend, if brands have a centralised view of their data and understand it better, they can still focus on increasing revenue whilst also maintaining good margins. Typical software often doesn’t provide the kind of view you need, displaying product performance at SKU level and category level.
Engaging with your data effectively and making use of customer trends can keep your profitability high even with a reduced marketing budget. The best way to achieve this is to optimise your online presence and operations in any way you can without high expenditure.
Utilise data with AI tools:
- View products that are in the negative margin and reduce costs by either discontinuing or pausing spend on these underperforming products.
- Use discounts/sales to get rid of dead stock so you can focus on pushing your best-selling items instead.
- Focus on short-term KPIs — these will drive revenue while also considering successful, long-term metrics, like profitability. Ensuring you’re focusing on the right KPIs for your business is vital.
- Invest in the right AI tools to ensure departments are focused on the right metrics that all align to the overarching business objectives.
AI-driven software can help intelligently optimise listings, utilise data and allow you to gain an overview of your company performance — so you can see exactly what products are in the negative margin and therefore see what’s damaging your revenue. Having this centralised data is vital to making the right data-driven decisions and adjusting your marketing campaigns accordingly.
How Upp can go further for your business
Unlike other AI-tools, Upp can help provide you with that visibility over your data and business performance, so you can gain insight into the bigger picture and make informed decisions to help increase your revenue and profitability.
This software also provides you with an overview of data, which brings you actionable insights and a better idea of specific tactics to employ. As well as this, it gives you a clear mission based on data that discourages siloed departments.
An AI-driven platform will allow you to more simply interface with multiple online channels, retain visibility over your customer data and maximise the SEO of your product posting. The result of these can only be improved sales and improved customer relationships. These are especially important benefits right now as you navigate your online presence and streamline your marketing strategies.
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