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Lead Generation for ecommerce stores
In most cases, store owners run paid traffic to product pages and product offers. This is exactly what they should be doing. This is the core campaign of a store's new sales strategy.
But there is another campaign a store can run that is just as valuable. That is the lead generation campaign.
In fact, in this article, I will argue that the lead generation campaign is just as important as a conversion campaign.
Why?
A lead generation campaign is critical for ecommerce businesses because it lowers the cost of conversions.
Let's explore the three main benefits of running lead generation campaigns for ecommerce stores.
Benefit one: Free repeat visits
When you run a paid traffic conversion campaign (that is, linking cold traffic to a product page), a prospect will visit your store (a click-through), explore your offer, and may or may not make a purchase. If they do purchase, then you have captured a new customer. But most people don't buy when they click an ad. That's normal.
But conversion campaigns can be very profitable. But in my fifteen years of experience, I have observed that profitability doesn't last forever when we do this.
In some cases, when we advertise long enough, the same people keep seeing and clicking our ads. And every time you promote to the same audiences, and the same people (who have not bought in the past) click on our ads, we are paying multiple times for the same people to visit us and not buy.
How would you like it if you could send repeat visits for free?
That is what lead generation campaigns do.
The fact is, most people will not buy the first, third or even tenth time. So we want to eliminate the cost of all these store visits. When you build a list of potential customers through a lead generation campaign, you pay ONCE to get them on your list. And every time you send a (well-crafted and segmented) email campaign, your incremental cost of a store visit is zero.
In my work, I have seen clients reduce the budget for conversion campaigns, increase the budget for lead-generation campaigns (with the same total budget), and see an increase in new customer sales. But they also see an increase in repeat sales.
Benefit two: How to build a free traffic source
Here is the truth: paid traffic doesn't build a relationship with your customers. Like personal relationships, customer relationships must be nurtured through continuous (and personal) messages.
Most sophisticated store owners have this correct for their existing buyers. But do you know that you can also build relationships with non-buyers?
When you run lead generation campaigns, you will effectively build two email lists: a buyer list and a non-buyer list. If you do relationship building properly, your non-buyer list will be bigger than your buyer list.
What does that sound like? To me, it sounds like a FREE traffic source.
Let's say you have a non-buyer list of 27,000 people. You added these people to your list with targeted lead-gen offers. That means that they are highly interested in what you sell or the problem you solve with your product.
Now, let's say that you have very good segmentation strategies and enriched data; you can send one email every day of the week (by the way, we did this for a client and increased their revenue from email by 951%).
You still with me? Cool...
The emails you send to this ever-growing non-buyer list are now your new conversion campaigns. New customers, every day. And the incremental cost of future visits for a new customer is zero.
Benefit three: Training email buyers
When you get really good at sending emails to non-buyers, you are actually developing the skill of "sending good emails". At my agency, EssTwo, we have sent so many emails for our clients that some no longer run paid traffic for conversions (that is, paid traffic sent to product pages). Instead, they focus on lead generation and retargeting.
The third benefit is this: people who bought via email lead-gen campaigns are more likely to keep buying via email.
Now, to be clear, buyers from paid traffic can also become repeat buyers via email. But If someone makes their first purchase buy email, I would create a segment purely for this behaviour. Future campaigns, offers, and promotions can then be designed to tap into this segment.
Lead generation is investment thinking
Investing is hard because you need to be comfortable with delayed gratification.
Like I said at the start, you absolutely want to run conversion campaigns (where you direct cold or retargeted traffic to your product pages and offers). But I have seen people get addicted to the "sale now" at the expense of long-term profitability.
If you invest in lead gen, you build a non-buyer list that visits your store in the future for free; the list becomes an in-house traffic source, and when they buy via email for the first time, they will most likely keep buying that way.
Now that... is a good investment.