What An Early-Stage Software Company Can Learn From a High-Growth E-commerce Company
As the tech industry continues to thrive and grow in Indianapolis, I’m finding myself spending more and more time talking with founders who are in the early-stages of building B2B SaaS companies. On the other hand, I’ve been running a successful e-commerce company — selling physical products on the Internet — for over 10 years.
While there are certainly some major differences between a company that sells physical products, and one that sells software, I’ve found there are just as many commonalities. For that reason, we have a lot to learn from each other. The following are points I believe early-stage software companies can learn from a high-growth e-commerce company.
Build a Brand
For a B2C company, building brand equity is critically important. However, B2B companies often allow consistent and clear branding to take a backseat to other, more tangible priorities. Thanks to companies like ExactTarget, this sort of thinking is starting to change, and more SaaS companies are taking brand-building seriously from the outset.
At One Click, brand is ingrained in our DNA — it’s reflected in our products, our building, and how we communicate to our team members and customers. Because of this, our customers know what to expect from us and are attracted to the way our brand makes them feel. Create a brand that your customers are excited about and you’ll start building a tribe of followers.
Make Decisions Based on Data
This is important for any company, but especially those charged with high-growth and steep revenue goals. Weekly reporting should become routine for you and your team — get everyone used to checking their numbers everyday.
At One Click, all of our teams have weekly huddles where KPI dashboards are reviewed. Each team typically has 3-5 primary metrics with dashboards that may have many more. The metrics for each team support our critical metrics as a company, which include revenue, CAC, LTV, EBITDA, and NPS. If a metric is performing better than expected, we take this time to learn if there are items related to the strong performance we can apply to other areas of the business. If a metric isn’t performing as expected, we discuss ideas on how to improve the metric and a plan of action is developed. This level of discipline around data and metrics across the organization has played an important role in our growth. All of our teams are constantly using insights from data to help make predictions and informed decisions on which levers to pull next.
Experiment With New Marketing Channels
There are the obvious marketing channels, like paid advertising, email, and affiliate marketing. Then, there are the emerging channels, like Instagram, Pinterest, influencer marketing, and Snapchat. Because marketing is constantly changing, it’s important you have someone responsible for keeping up with the latest trends.
How do you keep up with the latest trends and channels? To solve this problem at One Click, we created a full-time Growth Manager position late last year to manage our experimental marketing efforts. This dedicated team member is conversant in a wide spectrum of acquisition channels and leans heavily on digital marketing, testing, and analytical competencies to increase the reach of our brand. The primary objective of our Growth Hacker is to define and prioritize the company’s growth strategy, coordinate, and then execute new growth channel experiments.
The early returns from having one person focus on growth are really encouraging, and I’m excited for what this team can become in the future. Consider doing this for your software company, or hire an entire team dedicated to sparking growth and leveraging new marketing channels. It’s important to be clear with your team upfront about what your growth objective is (e.g. customer acquisition), ensure you have the proper tracking instruments in place to measure effectiveness, then prioritize and execute tests using a consistent framework. Tools like Google Analytics, VWO for A/B testing, and Hotjar of Crazy Egg for heat mapping and visitor recordings are invaluable for growth campaigns.
Focus on Customer Experience and Retention
For both e-commerce and SaaS companies, customer retention is critical to building a lasting brand. At One Click, we focus on providing all of our customers with an extraordinary experience every time they visit our site, talk to one of our team members, or open an email. This type of customer service, or customer happiness as we call it at One Click, ensures our customers feel valued.
Mapping out a customer journey roadmap that shows you every touchpoint your company has with a customer is an excellent method in determining new opportunities for making a positive impact. We made this a reality by following five simple steps. First, have a large physical space to work in to be able to lay out and tape customer decisions points and paths along with emails and anything else that the customer will touch. Second, consider customer attitude and mindset as you review each decision point along the way. Third, incorporate site UX to ensure consistency in the look, feel, and copy between site experience and email experience. Fourth, identify gaps and look for opportunities to communicate where none exist. Finally, test and measure content, send cadence, and packaging based on findings and analysis. To ensure we can retain our customers due to great customer experiences, we’ve learned that it’s often the little things, like handwritten notes in packages or personally calling a customer to answer their questions, that makes all the difference.
Empower Your Team to Think Big
One of the most important lessons an early-stage founder can learn is that you can’t do everything yourself. Empower your team to act like owners in the company and think big when it comes to new ideas and iterations. If you focus on hiring talent that aligns with your core values and is willing to work hard, you’ll be setting your company up for success. Bottom line — trust in your team, and they’ll deliver big things.
How do you help set your team up to deliver these big things? Be sure there is 100% alignment from the start. Here at One Click we go through a collaborative goal setting process both annually and quarterly. We start by setting company wide goals and cascading those down throughout the organization. Teams have 3-5 annual goals and each individual has 3-5 quarterly objectives. The truth is we set challenging goals, but we work hard collaboratively to ensure there is alignment on what is expected and agree on the objectives together.
These are just a few of the things early-stage software companies can learn from high-growth e-commerce companies. Keep this advice in mind as you head into stages of steep growth, and you’ll be better prepared for the challenges that lie ahead.
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