An Explanatory Guide to E-commerce Product Management
Blog: MattsenKumar Blog
Unlike a decade ago, where users had little to no option, today customers can spend hours comparing e-commerce platforms and settle with one that offers the best pricing with easy returns. Earlier, when the competition was low, onboarding customers was tough but in contemporary times, where acquisition is easier, retaining a customer is troublesome.
30% of US adults have agreed to buy from a new online retailer if detailed product information is available on the platform. Similarly, 81% of online shoppers spend more time on Google comparing prices, reading reviews, and accessing product information.
Multiple studies suggest that product management is the key to e-commerce success in recent times. Some of the leading players including Amazon have improved their product management and it shows. Now users are offered accurate product recommendations, they are intimated about re-purchases before they run out of a subscription or product. Similarly, customers are accessing features that improve customer experience but are the result of effective product management.
What is Product Management?
In layman language, product management can be defined as a recurring event. The event includes steps where new products are identified, tested, onboarded, promoted, sold, delivered, and retired in a timely fashion. The lifecycle of a product ends when the demand goes down. The cycle also includes post-sale service and return management.
Product management executives are responsible for a plethora of task that includes:
- Market research and product potential identification
- Identify sources for procurement of product
- Measuring challenges and opportunities related to a product
- Market analysis, competition benchmarking, and market expectation
- Marketing plan to promote a product
- Additional support required from key stakeholders in promoting the product
E-commerce product management is different from product management in IT or other traditional businesses. E-commerce customers spend a tangible amount of time comparing products and reading user reviews on the web, which puts e-commerce players in a unique situation. To ensure all visitors convert, e-commerce players need to work out a few things including:
For e-commerce players, product management is more about helping customers find the right product at the earliest. Improved product discovery and the incessantly increasing number of products on the platform is perhaps the right route for e-commerce product management.
E-commerce Product Management Statistics
- 40% of Millennial believes product content is an important decision influencer
- 98% of users have stopped a purchase just because of a lack of product information
- 50% of users who participated in a survey have returned a product because it didn’t match the product description
- 35% of users never shop from a website that offers incorrect search results
- For 84% of global shoppers, customer experience is a key differentiator
- Faster and accurate product discovery is helping users have a quality shopping experience
The multiple statistics tell us how e-commerce players can improve the experience, retain customers and promote products by fixing a few problems including product discovery, adding quality product information, and by onboarding more relevant products.
What are the Key Components of Product Management Strategy?
Well, for traditional industries, the product management journey includes research, product identification, market study, onboarding, promotion, customer service and upgrade. For the e-commerce industry, product management differs a bit. The involvement of customer benchmarking influences the overall product management cycle and requires a few more additional steps.
Since E-commerce is based on Internet, organizations need to fix a few problems including:
- On-site search improvement
- Optimization of product catalog to make search engines work better
- Leveraging user-generated content for promoting genuine sellers
- Relying on quality customer support to help people find products and seek support
- Allow users to compare products
- Help users view more relevant products without repeating the entire search cycle
Based on the pointers discussed above, the e-commerce product management strategy includes the following steps:
Effective Catalog Management: With a catalog that follows international and internal guidelines, customers can easily discover products they are interested in. Similarly, a well-written product description allows both on-site search engines and search engines like Google to identify products and rank them for relevant products.
Catalog management includes catalog quality check that reduces error in catalogs and controls return requests. Catalog management also offers catalog enrichment, which simplifies product recommendations and allows e-commerce platforms to create theme-based bucketing.
Product Discovery Improvement: We all have left a website if it took too long to load. Speed is a key attribute on the Internet and any online store that ignores it will be doomed. Investing in page optimization, the speed improvement is crucial for the survival of online businesses. Well, with cloud servers and CDNs, e-commerce players have improved the site speed but product discovery remains slow. Product discovery time is the time spent by a customer looking for the desired product. Slower product discovery leads to customers leaving the platform and buying it from somewhere else.
Customers love to get more done in less time, when they are provided with faster and accurate results, they are likely to make a purchase and talk about the experience too. Offering faster product discovery allows online stores to improve customer retention rate, increase average order value and leave a lasting impression on customers.
Well, faster product discovery is a result of varied processes running simultaneously at the back. Catalog management is at the heart of all such improvements.
The road to successful e-commerce product management starts with effective catalog management.
Selection Enhancement: Well, increasing average order value, offering accurate product recommendations, creating theme-based bucketing, and offering more products to compare with, all of these can be fulfilled with selection enhancement.
Selection enhancement services offer missing product study, seller identification, and seller onboarding. The team of industry professionals studies the platform and its prime competition to identify the gap.
Once the gap is identified, the experts identify sellers with an inventory. The sellers are contacted and onboarded. The online stores offer requisite support with onboarding and getting used to the platform. The seller management team assists the sellers in following guidelines and selling online without flunking the rules.
E-commerce Product Management Best Practices
E-commerce is a nascent industry with a history that is just 2 decades old. There’s more to discover than to learn from. Leading e-commerce players like Amazon and Flipkart have always pushed the envelope by trying new things. While the industry is far from getting saturated, there are proven paradigms that work and they work because they have customers at the center.
Let’s all remember, e-commerce product management aims to make the best use of available products and content related to it. The goal of management should to be increase visibility and drive more sell. All these best practices are based on visibility improvement that leads to more sales:
1. Soothe Customers with Relevant Information
Customers look for keywords and attribute values when researching a product. 4G/5G, lithium battery, Android OS and Google updates are among the top keywords a customer looks for when researching a mobile device. A customer that finds all these features in a product will look no further. A huge percentage of cellphone searches are made with these keywords.
By highlighting these attributes either by mentioning them in the product title or by listing them separately on the product page, online stores can offer a better experience. Highlighting features improves product discovery and drives more sales.
2. Cross-Sell and Up-Sell
In the contemporary world, where every product is a fast-moving good, it is necessary to ensure that all products are receiving maximum visibility. No one knows the life of a product, one innovation, one little improvement can turn the existing products obsolete hence promoting products at every instance possible is necessary.
Cross-Sell: Allow users to view products that are relevant to products they are already buying. A Kindle cover with a Kindle is necessary to keep the product safe. Similarly, cross-selling other products with a laptop is also helpful.
Up-Sell: When customers often are willing to spend extra for quality products and on quality experiences. If you have a product that is a bit expensive but can offer incomparable benefit to customers, you must promote it through Up Selling tabs like “Similar Products” or “High-end Products from the Same Category”. Well, Amazon is a testimony that all such up-sell and cross-sell ideas work.
3. Enrich Products for More Visibility
Well, as mentioned earlier, with the end goal of more visibility and increased revenue, product management should focus on promoting quality products and experiences. Catalog enrichment helps online stores with:
- Brand interference reduction: When attribute values are missing from product catalogs, genuine products do not make it to the search results. Fake or imitated products start ranking for genuine keywords leading to a bad experience and increased return requests.
- Theme-Based Bucketing: We have already discussed the importance of speed and product discovery, with theme-based buckets like “Under $99 Products”, “Christmas Décor” and “Birthday Ideas”, online stores can help customers save time, view more products, and have a memorable experience leading to more sales.
- SEO Benefits: When products start ranking on Google, they will gain more visibility, drive more sales and their product lifecycle will increase. Organizations will be able to sell enough products before the products die, which is perhaps the end goal of e-commerce product management.
4. Personalized Experience is the Key
Amazon drives 29% of its revenue by recommending accurate products. Even the smallest e-commerce store can recommend accurate products and generate more revenue. As mentioned, the road to successful product management starts with effective catalog management.
By making changes in the catalog that helps customers make an informed decision, e-commerce stores can generate more sales. The best way of offering a personalized experience is to recommend correct products. Allow customers to find the desired product almost instantly. Allow them to have fun shopping on your platform. Leverage their age, geolocation, gender, interests, and purchase history to identify products, price range, and brands they prefer and recommend accordingly.
Final Thought on E-commerce Product Management
The COVID pandemic has accelerated e-commerce growth. Countries like Singapore, India, and China are registering the highest growth in e-commerce adoption. In India, the government is collaborating with e-commerce platforms to deliver essentials, which is increasing the reach of these online stores.
Going forward, the competition will increase too, every store will aim to sell the same product, while some will play on price, some will win customers with a quality experience. With effective product management, e-commerce stores will be able to sell products within the stipulated time, which will maximize revenue and decrease time spent on the shelf.
The aforementioned statistics, best practices, and paradigm to effective e-commerce product management will help e-commerce leaders succeed.
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