Boosting Revenue for Cycling E-commerce Sites
"Over time, all marketing strategies result in sh*tty clickthrough rates" - Andrew Chen
The cycling industry is incredibly competitive - there are hundreds of bike brands and component manufacturers, and many thousands of places to buy both in-store and online. With so many retailers competing for rider's dollars, how do you set your business apart?
In this blog post, we share ideas to help retailers with an online presence generate more revenue by improving acquisition (getting more customers), increasing conversion (increasing the percentage of customers who buy something), and boosting retention rates (keeping those lovely repeat buyers coming back).
Improving Acquisition
To get a cyclist to buy from your site, they need to visit it first. Attracting customers can be done through a variety of channels including paid ads (Google, Facebook, Instagram), engine optimization (SEO), social media, and others. The key is not to do exactly what your competitor is doing (it leads to those poor click-through rates over time), but to get creative and find channels that resonate with your target audience. The best way to do this is by testing new channels and devote the bulk of your resources to the ones with the lowest customer acquisition cost (CAC) and greatest reach. It sometimes helps to get extra creative...
We've brainstormed some more unconventional ways to bring your brand to the forefront:
Diamonds in the Rough - Advertising in the mainstream is expensive. Niche blogs and influencers can be more concentrated in their audience and as such, less costly. Try out audience insight tools like SparkTorro to help you identify hidden gem websites, blogs, and social accounts that your audience engages with (their free plan gets you 5 searches a day!).
Compatibility Tools - landing pages or web apps that help cyclists find compatible parts like Fanatik's bike builder and the dropper seatpost calculator from PNW Components. We're working on several compatibility tools to help riders find parts that can be deployed to cycling ecommerce sites, head to our industry page to learn more.
Do Something Outrageous - I have no idea who won the 2017 Tour de Pologne (Dylan Teuns, BMC Racing), but I do remember the video of RedBull rider Szymon Godziek doing a backflip over the peloton in full lycra! Backflips aren't necessarily required... but if you have the means to create original content (like Evo’s gear guides) or are comfortable taking a stance on something controversial (i.e. e-bikes, or the 27.5 vs 29 vs Mullet wheel debate), get it out there! You could be rewarded with a lot of attention.
Tip: To get the creative juices following on more customer acquisition ideas, check out the book Traction co-authored by Gabriel Weinberg, CEO & Founder of DuckDuckGo. (Short on time? Here's a summary of the 19-channels you can use to get traction mentioned in the book).
Increasing Conversion
Most of your bike e-commerce site visitors won't buy from you, but what if more of them did?
To better understand what drives your conversion rate, think about a line of people transferring water from a well using leaky buckets... With each person in line, more water gets spilled and you end up with less at your destination. To optimize, you either reduce the number of steps or the amount of spill at each transfer. Here are a few ways to stop the leakage:
Compete on Pricing and Availability
To get people to buy something on your site, you have to offer them the right product at the right price and have it in stock and on their doorstep in 2-days or less. (Yes, this is REALLY hard, but Amazon isn't going away anytime soon and you really DO need to do all these things well to win sales).
If you fall short in some of these areas try differentiating through other means. Some solutions include offering free add-ons for orders above a certain amount, or pop-up that says "Wait, don't go! Here's 15% off". These tactics make up for lost sales but at a cost. Use your customer acquisition cost and conversion rates to figure out at what point this stops paying off and resources are better spent making improvements elsewhere.
Help riders make buying decisions
Pardon yet another analogy... Ever buy windshield wipers at an auto-parts store? They ask for your make, model, and year of the vehicle, then offer you multiple options ranging from budget to the overly-expensive high-performance wipers. This doesn't exist for cycling yet (we're working on it!). To make an informed decision on which bike parts to purchase, riders often need to do their own research or ask for help.
In the case of riders doing their own research, they're likely leaving your page to figure out what part to buy. We've found that forums, manufacturer archives, and advice from former-mechanic friends in exchange for post-ride beers are all helpful. However, if a customer leaves your page or opens a new tab to research what to buy, it's an opportunity for your competitors to make sales that could have been yours. You'll want to be able to answer part purchasing questions directly.
We're developing tools to automate bike part buying recommendations, but in the meantime, consider adding live chat to answer customer questions in real-time. Most of the sites we've looked at over the past few months have some form of chatbot to answer basic questions and direct visitors to a mechanic for help with more technical questions.
Focus on User Experience
A great user experience (UX) often goes unnoticed, but BAD user experience frustrates customers and leads to lower conversion rates.
Sites with great UX have clean, well-designed interfaces that are quick and easy for a user to navigate. To improve your site's user experience, reduce friction! Look for things like sluggish load times and difficult-to-navigate pages with high bounce rates. To do this, look at your site analytics to see how long visitors are staying with each page they browse through before leaving or navigating elsewhere on the site.
For a more qualitative approach, usability testing allows you to observe the way an individual user interacts with your site and adds human commentary where session tracking does not. Site heat map tools like hotjar can give you the best of both worlds. Once you identify and address an issue, split testing the modified site versus the original will help you determine if the changes you make are effective.
Regardless of your site traffic, increasing your conversion rate by even small amounts can have a huge impact on your site's revenue.
Boosting Retention
Retention is the percentage of customers who return to buy from you again - with high competition for sales in the cycling industry, it's arguably the most important.
Never underestimate the importance of customer retention. For example, think of a passionate rider in their mid 20's with decades of riding on two wheels in their future... now estimate how many $3,000+ bicycles, tires, replacement chains, and upgrade parts they'll buy over the next 30+ years?! The lifetime value of an avid rider is many thousands of dollars, not $75 for a chain and some grips on a single site visit.
To improve your retention rate, don't just focus on selling to new customers; cater your marketing efforts towards converting existing ones. Brick-and-mortar retailers have local monopolies of their geographic area and are great at establishing relationships with customers - what can you do? Email offers, loyalty programs, remarketing campaigns, and improving customer service are just a few possible solutions. Feel free to experiment...
...we're a little biased to retailers that give riders free swag!
Finally, try asking customers who didn't come back why they haven't returned. For the cost of a gift card and a phone call, you might learn that you don't carry their favorite brand, your shipping is too slow, your costs are too high, or the customer service rep who handled their last return was an off-putting jerk. Best case scenario, your gesture might even win them back!
Where to start improving?
There are many ways to increase revenue through acquisition, retention, and conversion on your e-commerce site. If you're not already doing so, start by tracking each of these metrics, set some improvement targets for your site, and review the metrics regularly with your team. Focus on the improvements that bring you the biggest return on investment first, test them, and double down on what works.
To be the first to know when our part compatibility tools will be available to deploy on your website, sign up for our industry emailing list. Reduce friction, drive revenue, and optimize metrics with Fresh Grease!