Ecommerce SEO Is A NOT For Profit Activity

Author: Gab Goldenberg

Google is cutting the ROI on ecommerce SEO and has been for 8+ years. If ecommerce merchants don’t understand the changes below, they’re going to lose market share to savvier competitors.

Read on for what you need to do to survive and thrive.

Google has reduced the traffic and ROI available to SEO-ed sites by:

  • - Publishing sites’ content directly in search results as stock quotes, movie times, flight times, sports scores etc.
  • - Creating “universal” search results that make sites compete with Youtube, Google News, Product search etc
  • - Taking away keyword data for up to 30% of sites’ SEO traffic

And that’s just the more obvious things. But don’t take my word for it, Google proudly say so in this video:

Smart SEOs are already transitioning out of relying on SEO traffic for profit. They’re using it to acquire customers, period.

Everyone knows that repeat customers are easier to sell to and buy more. So make an initial low-profit sale to search visitors, so that you can add them to your email list and make more sales and profit later.

In fact, in my previous email to people who got a free advanced SEO book chapter, I went so far as to advocate selling at cost -i.e. at 0% profit – to maximize your conversion rate on SEO traffic.

Then wouldn’t you price everything – since you want search traffic on all your products – at 0% profit?

How will you ever be profitable then?

There are two parts to making long-term profit off of search visitors.

Part 1 – Dividing products between customer-generation and profit-generation
Part 2 – Segmenting traffic on the fly to personalize the products you show

Part 1 – Divide products between customer-generation and profit-generation

The reason for cutting into margins is that SEO traffic is decreasing, and price-comparisons are a click away.

The thing is … what if there wasn’t search traffic in the first place?

Challenge the assumption that all your products want/depend on search traffic!

Surprisingly, that’s the case for many products. For example, any new product doesn’t have existing search demand. (See sidebar.)

[sidebar]

ipad

Who searched for iPad phrases 5 years ago?

Apple built an audience of fans who loved its iMacs, iPod and iPhone. When the iPad launched, it became an instant best-seller.

Ecommerce SEO should build a customer base with cheap products. Then generate a profit by selling other products at higher margins to that same customer-base.

image credit: Sean MacEntee

Like this guide?

Get a free advanced SEO book chapter, or tweet the free chapter to others.

Free chapter subscribers get exclusive content mailed to them, like the part one of this post.

[/sidebar]
The point is that your site should feature two categories of products:

1) Acquisition products. These low-margin products are meant to draw visitors into the store, to be either immediately converted and/or upsold on products with higher margins.

In offline retail this is known as a “loss-leader” – a product that is sold at little, no- or even negative-margin.

It leads visitors into the sale that is then made profitable with crosssels and upsells.

2) Profit products. These are higher margin products that allow the business to grow and thrive.

Popular examples:

  • - Candy-and-magazine display at the checkout counter
  • - Accessories for your electronics, such as cases, memory cards, insurance
  • - “House” brands – if you manufacture the product, customers can’t get it from competitors, eliminating price-competition

So how do you make sure that your existing customers will see profit-generating products when they return to your site?

Part 2 – Segment the traffic and personalize

Have you visited Youtube while logged in to your Google account? Notice that it recommends videos specifically for you?

Or notice how Amazon welcomes you by name and shows you recently-browsed products? (Retargeting of a sort.)

You can use a free tool like BTBuckets (hattip Daniel Waisberg at SMX Israel) to show these visitors custom content. It’s called behavioral targeting (BT).

Why not just send existing customers to targeted landing pages? Why resort to fancy technology?

It’s not an either-or choice. You can do both.

Most products aren’t sold on the immediate first visit, though. So it’s useful to have this segmentation in place for when users return, potentially on a different URL than your targeted landing page.

They might visit your homepage instead – but fortunately you’ve got them cookied and IP-logged so you know to show them the profitable merchandise, not the acquisition merchandise.

To conclude:

Show SEO traffic your cheapest products – but don’t keep showing them flat-margin products once they’re customers.

Create your own products.

Differentiate them.

Bundle products.

Scrape Amazon’s “customers who bought X also bought Y” recommendations.

Show products that require a higher-degree of trust. Ask for Facebook-connect logins to gain demographic data so you can buy Facebook ads to keep increasing your email list.

Increase that average order value and those profits!

If you liked this post, you might also like:

Phillip Klien of BT Buckets on Behavioral Targeting for CRO, and Conversion Conference

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Brand Building Online – It’s Not Just Colors
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How Inhouse Ecommerce SEOs can add value
4 Advanced Ecommerce SEO Tactics

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