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The Four Pillars Of E-Commerce Optimisation

By Brian Ooi

July 12, 2024

15 Minute Read

blog-four-pillars-of-ecommerce-cover

Every e-commerce business faces two key challenges:

  1. getting traffic to your store

  2. turning that traffic into revenue.

Today, I'm going to take the position that a bird in hand is worth two in the bush and focus on problem 2. After all, we don't all have buckets of money to spend on ads for new traffic.

Instead we are going to look at the four key areas you can do to increase revenues from your existing traffic. We will discuss tactics, metrics and ways to find opportunities to do so!

The four key areas are:

pillars-ecommerce

Let's dive into each in more detail:

Pillar 1 : Conversion

Improving the conversion rate means turning more store visitors into purchasers. It is the foundational pillar of all the other pillars, as all other pillars depend on it.

Finding opportunities to improve conversions include listening closely to your customers. The key here is to identify the reason why people don't buy (and there will be plenty), and making changes according to the feedback.

conversion
Placing UGC (user -generated content) in product pages significantly increases trust in customers and improves conversion rates

Finding Conversion Rate Improvement Opportunities

  • Implementing on-site polls
  • Run website usability audits.

Example Tactics for Conversion Rates:

  • Welcome Offers
  • Streamlined Checkout Process
  • Implement Social Proof on Product Pages

Metrics for Conversion Rates

  • Purchases
  • Checkouts Started
  • Add to Carts

Pillar 2 : Spend

Improving spend largely means getting more revenue from your existing customer base.

Here we may immediately think about pushy upselling pop-ups , that ending up annoying customers and harming your store. But it doesn’t have to be this way. The key here is to offer meaningful, real value to your customers.

For example, if you are a music store, think bundling the sale of an electric guitar with an amp and strings, that suits the demands of your particular target audience.

conversion
Bundling different products in a meaningful way frames the offer in a more attractive way for the customer

Finding Spend Improvement Opportunities

  • Heatmap Analysis
  • On site surveys
  • Customer Service Interviews

Example Tactics for Increasing Spend

  • Offering warranties/protection on top of expensive purchases
  • Bundling
  • Progressive Discount Incentives

Pillar 3 : Frequency

This pillar focuses on customer loyalty, making sure each existing customer purchases repeatedly. In order to do so, it is important that the first purchase experience of the customer is excellent.

Here, a good post-purchase experience, email and SMS marketing are useful ways you can trigger positive experiences in your past purchasers, and remind them to purchase again.

Subscriptions and loyalty programmes are also effective ways of increasing purchase frequency.

subscription
Look for ways to incorporate subscription plans, according to your customers demands.

Finding Frequency Improvement Opportunities

  • Cohort Analysis
  • Customer Surveys
  • Email Marketing Analytics

Example Tactics for Increasing Frequency

  • Pushing for Subscriptions
  • Exclusive Offers/Products
  • Smooth Re-ordering Experiences

Pillar 4: Merchandising

Merchandising is nudging customers towards the products that are more profitable than others. Here increasing the visibility of the products you want to move, and vice versa for the products you don't want to move

will help improve the success rate. In order to do so, it is important to identify which products ultimately do and do not contribute to your bottom line.

subscription
Dyson has a "Deals" section where it is easily accessible

Finding Merchandising Opportunities

  • Product Performance Analysis
  • Customer Interviews
  • Preference Testing

Example Tactics for Improving Merchandising

  • Improve Discoverability
  • Product Recommendations
  • Key Variants
  • Smart Search

Key Takeaways

Not all the pillars may be applicable to you, it depends on the nature of your product/ service, but these are the key levers that you can pull that will immediately improve the performance of your store.

The key here is to be able to trust in the reliability of your data, as it will be the basis in which to decide what to do, how to do it and whether or not the changes worked.

When you in turn invest in traffic acquisition, you would be in a better position to reap the rewards!

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