June 10, 2014

E-commerce Research Chart: Channels that drive significant traffic

SUMMARY: In the MarketingSherpa E-commerce Benchmark Study survey, one marketer described his top challenge as "what channels to use and how to allocate resources to each channel."

To help with your channel selection, in this MarketingSherpa Chart of the Week, we'll take a look at which channels drive significant traffic for the 967 marketers we surveyed for this specific question – ranging from companies with less than $10,000 in e-commerce revenue to more than $100 million.
by Daniel Burstein, Director of Editorial Content

In last week's chart, we explored which channels e-commerce companies are investing in. This week, we'll take a deeper dive into the MarketingSherpa E-commerce Benchmark Study to discover not only which channels are used, but which channels are driving significant traffic, and how this changes by e-commerce revenue.

In the survey that informed this Benchmark Study, we asked marketers:

Q. What are your significant drivers of traffic? (select all that apply)

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Email is the biggest driver of traffic for companies with e-commerce revenue above $10 million

"Direct email works well if we only send when we have something interesting to say that is not just advertising," stated one Benchmark Study survey respondent.

As discussed in a previous Research Chart of the Week, it is easy to see why email drives traffic.

First of all, email is prevalent. When the Pew Research Internet Project reported on Internet usage, it lumped email in as just part of the Internet — "As of May 2013, 15% of American adults ages 18 and older do not use the Internet or email."

Second, email forces a decision. If you're able to get into potential customers' inboxes, they may click through or they may delete — and many do, as one marketer lamented "80% of emails go unopened."

But they have to do something. They won't just keep that email in their inbox forever.

When Katie Hansen, Marketing Manager, OpenSky, responded in the Benchmark Study survey about transforming the site into an online marketplace for small business. She talked about the central role email played in driving traffic:
"My marketing team went from a small team of five, to just me. 60% of our traffic comes in through emails, and I alone had to transform my emails to now be relevant to our new platform without losing any of that valuable traffic."

However, lower revenue companies tended to drive less traffic from email. There are many reasons why email marketing is difficult, especially for lower revenue companies.

First of all, email almost always requires a tech investment in an email service provider. At the base level, this investment helps:
  • Make sure the emails get delivered

  • Comply with anti-spam regulations

  • Manage a database of subscribers

A bigger technology investment can mean more triggered, personalized, segmented, automated emails, which can translate into more traffic for e-commerce stores.

Getting traffic from email marketing also requires that you have people to send the email to — whether it’s the gold standard of an opt-in list, or at least that you have a big enough budget to purchase a list.

Lastly, companies need the resources to have something to send to recipients — content perhaps, or at least a promotion. Stephen Sullivan, Managing Partner and Senior Writer, Sullivan Copywriting, LLC, is hoping to start using email marketing once his company has the content for a newsletter, and an optimized location to send recipients to after they receive the email:

"Have not used email marketing to any great extent, as we'd like to build that into a larger effort that incorporates our soon-to-be-designed website, featuring a company newsletter of sorts."

Even with these challenges, email was among the top drivers of traffic, even for the companies with the lowest amount of e-commerce revenue.

Organic search biggest traffic driver for companies with $10,000 to $10 million in e-commerce revenue

To drive significant traffic from organic search requires a unique mix of technical acumen (so you don't break any search engine rules) as well as valuable content that prospective customers actually want.

Of course, the mix of these two does not happen in a vacuum. On top of mastering content production and search-engine-friendly design and development, there is a constant search engine optimization (SEO) arms race.

After all, your company's placement on a search engine results page is also highly impacted by how good the competition is at producing content that customers want.

Hard work, yes, but as the data shows, it's a significant traffic driver for many e-commerce companies.

This is best summarized by the marketer who responded, "Organic search results and the effort to improve on SEO is totally worth the results!"

Social media is the biggest traffic driver for companies with less than $10,000 in e-commerce revenue

The more e-commerce revenue a company has, the less of a traffic driver social media is. So the survey respondent who mentioned, "We are behind the game in social media — not paying attention to this may cost us. My goal this year is to convince the company of the importance of social media in developing a brand," may have less to worry about than he thinks.

Of course, social media is not just a buzzword. Even for high-revenue companies, it drove traffic for a significant minority.

However, the impact was the biggest for the companies with the least e-commerce revenue. This is one of the few tactics where large companies can be more challenged than small companies.

After all, large companies have to deal with:
  • Large amounts of social media data (mentions, replies, etc.) that require a reply from the company

  • Many layers of approval before something can be shared from a brand

Smaller and more nimble companies tend to have less interaction on social media to manage and an easier approval process — perhaps the owner is managing social media.

They may also be able to have a more hands-on approach to the human element of social media. For example, in a previous MarketingSherpa Benchmark Report on social media, we found that blogger relations was the most effective tactic, something hinted at by the marketer who responded:
"We have stopped all display advertising and marketing through other sites and online magazines. Initially, we received a good response but the effectiveness has fallen very low and they are quite expensive channels to use. We have found that we get the best response from influential bloggers and Instagram. Facebook response has slowed as many younger users concentrate on Instagram."

Related Resources

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

Dive deeper into the E-commerce Benchmark Study in this week's webinar — Live from IRCE: Key insights from the MarketingSherpa E-commerce Benchmark Study

Watch exclusive interviews from the MarketingSherpa Media Center — live from IRCE, the world's largest e-commerce event

E-commerce Research Chart: Barriers to growth

E-commerce Research Chart: Which channels are companies investing in?

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