Close
Join 237,000 weekly readers and receive practical marketing advice for FREE.
MarketingSherpa's Case Studies, New Research Data, How-tos, Interviews and Articles

Enter your email below to join thousands of marketers and get FREE weekly newsletters with practical Case Studies, research and training, as well as MarketingSherpa updates and promotions.

 

Please refer to our Privacy Policy and About Us page for contact details.

No thanks, take me to MarketingSherpa

First Name:
Last Name:
Email:
Text HTML
Aug 26, 2014
Article

Ecommerce Research Chart: Using data to justify product and service improvements

SUMMARY: Where is the low-hanging fruit to make your ecommerce company more successful?

In the MarketingSherpa Ecommerce Benchmark Study survey, we conducted research with 4,346 ecommerce marketing professionals.

In so doing, we identified four factors that most differentiated survey respondents' success. In this MarketingSherpa Chart of the Week, we'll explore data around one of those factors.
by Daniel Burstein, Director of Editorial Content

Using data from the MarketingSherpa Ecommerce Benchmark Study survey, Diana Sindicich, Senior Manager, Data Sciences, MECLABS (parent company of MarketingSherpa), created a weighted success score to determine which factors, tactics and strategies made ecommerce companies the most successful. You can read more about it on page 9 of the Ecommerce Benchmark Study (made possible by a research grant from Magento, an eBay company).

Where were the biggest opportunities to become more successful relative to the competition?

This analysis identified a few factors that best differentiated survey respondents' success scores:
  • Order trends

  • Value of products and service compared to competitors

  • Gross margin level

  • Product and service guarantees compared to competitors

If you are interested in the math behind these opportunities, here it is — mathematically, these factors contribute to 44% (19%, 6%, 14% and 5% respectively) of the total score, but together, they accounted for 69% of variation in success score. This means that positive changes in these factors should be the fastest way to improve your company's success.

In this Chart of the Week, let's look at the data about one of those factors. In the Ecommerce Benchmark Study survey, we asked:

Q. How does your company compare to your competitors in the following?

One of the factors we asked about was value.

View Chart Online

Click here to see a printable version of this chart



In the above chart, you can see the answers to this question correlated with the computed success score referenced above.

The best marketing is a great product

While only 1% of the companies with better-than-average product value had a success score below 3, 53% of the companies that offered better-than-average value to customers had a success score between 6 and 9 and 27% of the companies that provided better-than-average value had a success score between 9 and 12.

This data shouldn't be shocking to you and, I would personally argue, it is what most people would like to see in the world: better products produce better financial results.

Choosing where to invest in the business for maximum ROI

However, business leaders have a choice where to invest (or not) in companies. The data suggested that when making those choices, leaders should factor in product and service value as an element that helps sell products.

For example, if investments like research and development, customer service, warranties or higher-quality ingredients for more durable products were looked at as marketing investments instead of costs of goods sold, would it change how business leaders allocate budgets?

With fundamental shifts in marketing and publishing over the last decade, word of mouth can spread quicker and be far more powerful than at any other time in the era of mass production and consumption.

The importance of having better product and service value than competitors is even more important for an ecommerce site than a brick-and-mortar store, since it is so easy for online shoppers to check reviews, ratings and customer feedback (or complaints).

So when you're conducting a competitive analysis, don't just stop at the marketing messages and strategies of your competitors. Also, it's important to truly understand how much value they are providing to customers, and if you can not only out-advertise them, but also serve your customers even better than they serve theirs.

I think one Benchmark Study survey respondent summed it up nicely by saying, "Challenge: Competing sites started offering better services. How Overcame: Adding value-added services."

Related Resources

MarketingSherpa Ecommerce Benchmark Study — Made possible by a research grant from Magento, an eBay company

Transparent Marketing and Social Media: Twitter and Facebook are the new Woodward and Bernstein

Landing Page Optimization: Simple, value-infused page increases leads 8% in 24-hour test

Marketing Career: Why a value proposition makes marketing 'good'


See Also:

Comments about this Chart

Aug 28, 2014 - Humberto Gonzalez L of FUTECO says:
Unfortunately the market is surrounded more by price factor instead of a real value offer for consumers. Advertisements generally emphasize in "easy to use, ready to, incredible price", and so on. The challenge to change this unfair situation could be influenced by a new generation of trends, oriented all to design new sustainable paths, I mean, true value chains, not only the current rapid chains of profit. Who will educate consumers for this purpose?



Post a Comment

Note: Comments are lightly moderated. We post all comments without editing as long as they
(a) relate to the topic at hand,
(b) do not contain offensive content, and
(c) are not overt sales pitches for your company's own products/services.










To help us prevent spam, please type the numbers
(including dashes) you see in the image below.*

Invalid entry - please re-enter




*Please Note: Your comment will not appear immediately --
article comments are approved by a moderator.

Improve your marketing

Join our thousands of weekly Case Study readers. Enter your email address below to receive MarketingSherpa news, updates, and promotions:
Note: Already a subscriber? Want to add a subscription?
Click Here to Manage Subscriptions