E-commerce is an abbreviation for Electronic Commerce. A simple definition will be the act of buying and selling over the internet. It has become conventional in people’s daily life. After all, there is always an everyday need for purchase. E-commerce then steps in to meet the supply of such needs. In America, companies such as Amazon, Walmart, eBay, and others have taken central control of e-commerce. It is, therefore, important to know their money-making strategies and the role of their customers.
E-commerce makes money in a lot of ways. The first investment strategy to be considered here is targeting the right audience. The importance of this is that instead of reaching out to a large audience, they will direct their content towards potential customers.
Another top money-making strategy is using marketing collateral to drive traffics. What e-commerce giants do is to use the customer’s research journey to address the customer’s pain point. With that, the benefits of a product can be quickly communicated to the customer.
There are also automated processes used to deliver goods, services, and follow-up on their customers. Here is a bit of repetition, the law of lasting impression. Not just that, customers can familiarize themselves with the e-commerce service delivery system, delivery is also very fast and efficient.
For the third quarter of 2018, the U. S. Census Bureau shows a domestic e-commerce sales increase of 14.5% from 2017. This increase translated to a total of 5.3% increase in retail sales in the same period. There is no that to the fact that there is money to be made in e-commerce. This can explain e-commerce, taking half of retail growth, especially during the 2020 pandemic outbreak.
Let’s take a peek at Amazon’s drawing board. Amazon is driven by its founder and CEO’s vision “to be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online and endeavors to offer its customers the lowest possible prices.” There we have it, Amazon’s biggest investment is in its customers.
In conclusion, the points above can be further emphasized with the deep discounting strategy common to e-commerce brands. However, customer service is not e-commerce’s only investment. Other investment strategies would include sellers’ fixed subscriptions, sales commission, logistics and shipping, and reinvesting profits, among many others.