SD BULLSEYE Results

Level 1 – The Rookie

Strengths

As a business who is just beginning the digital journey you likely have constrained resources – both in terms of working capital for investment in digital operations and also in personnel. You’re more dependent on “top of funnel” growth than other levels and sometimes that works to your advantage. This makes you adept at attracting core customers and influencing purchasing decisions because your core customer is likely more knowledgeable in the product and has experience in the space. They need less convincing that the product itself is useful or novel – what they need is to be convinced to buy it from you.

Your traffic isn’t huge, but your customers are very motivated. You have industry-standard conversion rates. Your Average Order Values range between 10-12% over your median product’s cost meaning most customers buy what they’re looking for, but not much more than that. Level 1 merchants are more capable than any other level at being nimble and iterating quickly. Level 1 retailers value platforms and partnerships which can turn on a dime and be responsive to customer needs.

Weaknesses

Your ecommerce business depends on a constant drip of content – email, biogs, social – to remind people that you exist. You might be tempted to encourage purchases with steady discounting. Your customer has a fairly low repeat purchase rate because most of your content campaigns are focused on attracting new growth. While you’re focused on keeping these wheels turning you have more of a risk than other levels at becoming distracted. With so many plates spinning you’ll find it harder and harder to keep them all in the air when experimenting with new ideas or implementing new programs. This is why so many businesses stall out in their top-line revenue growth in Level 1. It requires some measured risk-taking and wise investment in growing your customer base.

Because of this many Level 1 companies also have a tendency to lock themselves into platforms by iterating too quickly, creating customers dependent on vestigial features which were rolled out too quickly. These small groups of customers see you as a differentiator but you may alienate them when you try to abandon long-tail features that they have come to love which cause you loads of manual work; and these customers aren’t usually the quiet types! They are eager to give you feedback in both public and private and are quick to abandon you. This may make you more cautious when trying to replace vital pieces of your infrastructure, like an ecommerce platform, and make your growth into Level 2 that much more painful and expensive.

Opportunities

“Everybody starts somewhere, so just start” – in many ways Level 1 is the best level of success because you have so many options for growth. If you haven’t begun investing in paid search you should likely start. Doing this has advantages – you can control the spend, you can target who sees your ad, you can tailor the message, and you can bootstrap it without making massive development investment.

Paid search comes in many forms. At Level 1 you can take advantage of marketing suites you’re already using to dip your toe. Use these to your advantage as in your marketing suite to drive content to customer segments – tailoring the message for the customer whose needs you best understand – and then building out from there.

Customers want to engage with a brands they trust – and there are lots of ways to win that trust. There are also ways to lose that trust – slow shipment, poor communication, sloppy ad copy, products which disappoint, bad reviews. A brand investing heavily in paid search has to be executing in other areas well.

Summary

A relative newcomer to the world of retail, or digital retail, The Rookie can take many forms – from a large, corporate Enterprise taking on direct-to-consumer retail for the first time, to a historically distributor-based, catalog brand who, 50 years ago, took orders on pen and paper. The Rookie has endless opportunity, and are typically capital constrained. Investment is key, as are the right technologies.

Level 1

You are implementing basic ecommerce and marketing strategies. Your customers can navigate the site, enter the checkout funnel, and securely purchase products. But you have the potential to drive even more traffic and conversions, with some expert guidance.

Level 2

You are implementing more ecommerce and marketing strategies. You are actively acquiring new customers and streamlining checkout.

Level 3

You are improving the customer experience by incorporating personalization and allowing for user generated content. You are actively monitoring and improving performance.

Level 4

You are providing more services to your customers inside and outside of ecommerce. Even more marketing and UX improvements are also paramount.

Level 5

You have optimized your store throughout. You are innovating and offering better customer experiences than most.

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