From Launch to Stratosphere: Building the Ecommerce Profit Rocket

An interesting Digital Exits study about investment into ecommerce businesses made its way around the web, taken from their original study, a couple months ago. Several articles have also been published recently that address what exactly differentiates the best ecommerce companies from “the rest,” based on the 2015 Ecommerce Growth Benchmark put out by RJ Metrics. 

Therefore, I thought it might be timely to talk about some contributing factors to early success in ecommerce. Regardless of whether your interest in financial success is creating an attractive investment opportunity for someone else to take over or owning the company yourself for the longer-term, keeping the following objectives in mind will orient you towards the right trajectory.

Differentiators in Ecommerce Success: Growth Begets Growth

What makes a forty-million-dollar difference?

Early growth is one of the most important indicators of late growth. According to the RJ Metrics benchmark report, growing 2.5x larger than peers in the first six months (approximately $450 thousand vs. $200 thousand in monthly revenue) led to growing nearly 5x larger over three years (approximately $50 million vs. $10 million monthly revenue). RJ Metrics attributes this early growth to product/market fit, rather than to marketing efforts alone.

Shopify’s Tommy Walker further notes that pre-launch marketing needs to occurs months (if not years) in advance of the initial release and that hooking a customer on buying from your company is also key. So, while customer acquisition needs to be aggressive, getting your top customers to repeatedly purchase and increase their order values is arguably more critical.

There’s a “duh” factor to some of this , but the list of possible things you could attempt to focus on to grow your ecommerce business is enormous—it’s helpful to know that there are five key things you can focus on:

  1. Product/market fit
  2. Pre-launch marketing
  3. Acquiring customers rapidly
  4. Getting customers hooked
  5. Growing revenue as much as possible in the first six months

Admittedly, each of these five items are a million dollar question of their own — but it’s still a valuable place to start for formulating and prioritizing your goals and to-do list.

Differentiators in Ecommerce Success: Customer Experience

Customer experience is such a buzzword in the software space because so much has shifted or is shifting to a subscription model, the profitability of which hinges upon recurring revenue. You are unlikely to retain customers (and their recurring revenue) if you do not provide a satisfying customer experience.

In the ecommerce space, customer experience is taking off because of how easy it is for customers to find another vendor who provides similar products at a comparable price. The differentiator in winning customers and repeat business has become a matter of making the experience of engaging with your company more enjoyable.

Another key finding from the RJ Metric report is that the leading e-commerce companies generated most of their revenue at the $50 million level from returning customers, not new ones.

So how do you lead a company to improve a concept as fuzzy as customer experience?

Blake Lyon of Lerer Hippeau Ventures, a seed stage venture capital fund based in NYC, lists a few things that can help contribute to a more enjoyable customer experience such as:

  • Solving problems with a personal touch
  • Building passionate communities
  • Blending valuable content into the experience
  • Offering “try before you buy” opportunities

To these, I would add:

Removing as many roadblocks from the purchasing process as possible and providing spontaneous moments of value.

The fewer pain points you introduce into the buying process, and the more effectively you can provide positive reinforcement for a customer’s choosing to do business with you, the better. (You can read more about excelling at the transactional aspects of ecommerce on the cleverbridge Ecommerce Blog here.)


The best predicator of 3-year growth in ecommerce is early growth. To ensure the best performance in those critical first months, focus on market fit and pre-launch marketing for up to a year (or more) prior to launch. Once you’ve launched, ensure you’re creating a positive customer experience while maintaining focus on aggressive revenue growth.

Chris Childers is Senior Vice President at Velaro Live Chat. He is a results-oriented software executive with 18 years of experience in product management, software sales and team management. Before joining Velaro, he worked as a Senior Business Development Manager at Microsoft and held roles at AVIcode in product management and business development.