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2023 eCommerce Half-Time Report: Successes, Failures, and Expert Analysis — Agency Partner Spotlight 01
As we reach the middle of 2023, the eCommerce landscape continues to change rapidly. Merchants are navigating economic changes, the rise of AI, shifts in customer retention strategies, and the challenge of balancing growth with profitability. With consumer behavior also evolving, new challenges are emerging.
So, what does this mean for the rest of 2023? What strategies are working, and which ones aren't? And importantly, how are industry experts preparing for the second half of the year?
Here at Carro, we're all about shedding light on the eCommerce landscape.
To provide insight into these key questions, we at Carro have turned to six of our distinguished Carro Agency Partners.
They share their perspective on the first half of 2023 and offer their focus to crush Q3 and Q4. This report provides a clear understanding of where eCommerce stands today and where it's heading.
Their answers are worth their weight in gold and we’re giving it away for free!
Here are the questions we asked: (click around each if you want to skim)
*note at the end of each section we've placed a tl;dr summary for your convenience. You're welcome :)
Let’s dive into these burning questions and help you get ahead of the second half of 2023 💪.
Can you share your two most significant insights from the first half of 2023 in eCommerce?
The Shopify Network Effect is Real | Brandon Amoroso - Founder & CEO of electrIQ
"Being able to identify anonymous website traffic and identify them with targeted messaging, whether via email or direct mail, is a great way to increase the effectiveness of your paid acquisition campaigns.
The Shopify ecosystem network effects continue to get more powerful. Shop Pay, Shop App, Shop Cash, etc. are all great products in a vacuum, but the value each provides continues to increase as more and more merchants and customers utilize them. For example, there are over 118 million registered Shop Pay users today, giving all Shopify storefronts a conversion rate advantage versus the competition. Even if a platform like BigCommerce came out with something similar, they don’t have the scale to compete with Shop Pay results"
How Brands are Driving Repeat Purchases for Free | Philip Sblendorio - CRO & Partner at AMB Interactive
"We are seeing many brands scale back on Meta ads and finding more success with retention marketing strategies - specifically email and SMS accounting for up to 40% of revenue for some clients. SMS, in particular, has become a fast-growing revenue channel for brands. Companies have also dialed up TikTok ads and pulled budgets from Meta. Offering your products on Amazon and cross-store-selling (collaborative commerce) platforms such as Carro are easy wins as well.
Brands are dialing back on product expansion and honing in on main products/categories or cross-store selling. They’re finding opportunities to drive more repeat purchases and creating subscription services. We are also helping many brands build out their loyalty programs to encourage more frequent repeat purchases and to upsell VIP buyers into subscribers."
Recession? Not So Fast.... | Nihar Kulkarni - Managing Director, Partner at Roswell Studios
"Fears of an economic recession, while still widely held, have not been immediately realized. Consumers are still spending at an increasing clip, and inflation seems to be slowly taming. While inflation is still higher than it should be, the increase in Fed interest rates seems to be accomplishing the soft landing that the Fed is aiming for (no jinx in advance). However, brands are still concerned with their long-term growth versus consumer demand, and as such are trending towards measuring their paid ads strategy against a robust retention marketing strategy. This effectively diversifies their marketing mix to optimize their revenue by hedging their interests proportionally to their business goals - instead of putting all their eggs in the top-of-funnel basket - which was traditionally most brands' approach.
Merchants are looking at investing in marketplaces as an additional sales channel. They understand that their site is the home base for D2C, but with the advent of marketplaces throughout the eCommerce ecosystem, they understand that just as in real life, they need to meet their customers wherever they are shopping. It is arrogant to think that you can target all of your customers on your main store site; and if so, why do brands sell on Amazon? That’s the world’s largest marketplace - why not adopt more curated environments so that you’re not just competing on price, but competing more so on value to a very targeted customer?"
Social Commerce Is The Next Frontier | Anthony Spallone - Director of Operations at Arctic Grey | Shopify Plus Enterprise Solutions
"We've observed two game-changers in 2023: personalization and social commerce. It's like rocket science, but for shopping - using complex data and AI, we're crafting uniquely tailored experiences for each customer, like creating a custom spaceship for every astronaut.
Social media is also morphing into a buzzing eCommerce hub, turning scrolling into shopping and making purchasing as easy as liking a photo. At Arctic Grey, we're the engineers turning these concepts into reality, propelling businesses toward the stars of success."
Moving Away From UGC Ads | Benjamin Mitchell - Founder | CEO at Privé Creative
"Creative trends adopting higher produced storytelling over UGC: UGC ads are still a critical and highly effective part of a brand’s marketing funnel, but there is an over-saturation of UGC across social platforms and that has caused a diminishing level of trust with consumers. Brands are starting to focus more on storytelling and lifestyle ads that are produced to be high quality. This is something digital disruptors were trying to get away from, but trends are always cyclical, and good ole’ commercials have made their way back.
Whitelisting ads through creator pages has quickly become a winning strategy: With higher production value ads becoming more popular, it doesn’t mean that UGC and Influencer strategies are disappearing, they’ve just evolved. Brands have been focused on whitelisting ads through content creator pages to get better deliverability, lower CPM’s, and a more native experience when serving ads. Media teams are working this into their baseline strategies as a best practice, and all of our clients are requesting whitelisting rights for all UGC projects."
Rethink Your Landing Pages | Victor Ricci - CEO at Mattered
"We recently ran a market research campaign with over 1,000 participants and found some interesting takeaways including “The top 4 reasons people prefer online shopping”
They are:
1. Product Information
2. Exclusivity / Availability
3. Reviews or Social Proof
4. Convenience
“Product information” had nearly twice the amount of votes as “Convenience”! This serves as a really fantastic and stark reminder that well-written and easily digestible product pages can make or break your eCommerce business. It’s really easy to get hung up on the “convenience factor” you provide as an online seller (which is obviously important) but don’t let that completely dominate your landing pages. If you are able to authentically articulate why a customer should give you their dollar vs your biggest competitor, you will win."
Carro's takeaway: In the first half of 2023, eCommerce has been defined by targeted, personalized marketing, increased emphasis on retention strategies, and the growth of diverse sales channels. Key takeaways include the rising importance of robust product information, the strategic shift from Meta ads to platforms like TikTok, Amazon, and Shopify's expanding ecosystem, and a resurgence of higher quality storytelling in advertising.
What have been some significant changes, positive or negative, that your clients have experienced in 2023?
Direct Mail and Wholesale On The Rise? | Philip Sblendorio - CRO & Partner at AMB Interactive
"Many clients have experienced a slowdown in growth through traditional acquisition channels. Given the increase in competition over the years combined with changes in privacy and iOS updates, CPAs and targeting have created a less scalable environment, forcing DTC brands to pivot their marketing efforts to other channels such as direct mail and wholesale."
Creativity And Scrappy Acquisition Proves Lucractive | Victor Ricci - CEO at Mattered
"In 2023, brands have shown an increased willingness to get a bit more scrappy when it comes to acquisition, testing new channels, and even content. It's been an unpredictable few years for most DTC brands, and a lot of what was previously guaranteed no longer seems viable. This shift has forced many brands to reconsider their growth strategies and go back to the drawing board, which in turn has led to a surge in more creative marketing tactics and a greater focus on 'thinking outside the box.'"
Testing Creatives Got a Lot Easier | Benjamin Mitchell - Founder | CEO at Privé Creative
"Speed to test creative strategies has ramped up and testing has been more important than ever. AI tools are popping up everywhere and marketers took to these tools super fast. They can now test more hooks, more CTA’s, and more types of messages faster than ever before. This has made it easier to test content on TikTok specifically since the platform's biggest challenge is producing high volumes of content to push into the algorithm. Now that you can come up with concepts, write hooks, and even edit content within minutes, the road to success on TikTok will become a lot easier."
Merchants Seek Long-Term Growth Partners | Nihar Kulkarni - Managing Director, Partner at Roswell Studios
"Positive: Merchants more than ever are not looking for an agency - they’re looking for a long-term partner. They want to know what value an agency can provide first, then be concerned with cost. Data is king. With the mandated move to GA4, and platforms like Daasity providing robust LTV analysis, top-line revenue is no longer the most important KPI. LTV vs CAC as an indicator of ROI is becoming more and more critical to analyze, as merchants focus on profitability rather than just gross sales. eComm stores have had about a decade (on average) of a lifespan at this point, and as such are looking at how to evolve to their full potential —> as such, conversion rate optimization (CRO), native functional development (rather than app adoption), headless commerce and leveraging full functionality of platforms to enhance customer user experiences are becoming more top of mind decisions.
Negative: Merchants are dropping agencies that look at them as invoices rather than brands. Although this isn’t a negative trend, it is if you’re an agency that doesn’t understand the simple truth of why you exist - you should be in the business of building businesses, not collecting checks!"
The Birth of Recommerce in 2023 | Anthony Spallone - Director of Operations at Arctic Grey | Shopify Plus Enterprise Solutions
"In 2023, many of our clients have observed significant growth in the "recommerce" trend, the selling of previously owned goods. This trend, driven by a growing consumer focus on sustainability, has enabled our clients to engage with more environmentally sound practices, creating a positive impact on their brand image. At the same time, the need for flexible commerce has become more evident, forcing businesses to adapt quickly to changes and adopt a more iterative approach to testing new ideas." -
New Talent On The Market Presents New Challenges| Brandon Amoroso - Founder & CEO of electrIQ
"Hiring talent is significantly easier now than it was in 2021. A round of layoffs in the industry has opened up the talent pool considerably, but it has made sorting through applicants much more difficult."
Carro's takeaway: In 2023, eCommerce businesses have grappled with significant changes, necessitating adaptability and innovation. Amidst slowing growth from traditional acquisition channels, brands have explored new platforms and content, adopting creative marketing tactics and an iterative approach. A noticeable shift has been observed toward valuing long-term agency partnerships over cost, while data analysis, specifically Lifetime Value vs Customer Acquisition Cost, has gained importance. The rise of 'recommerce' has also been significant, highlighting consumer sustainability concerns. Lastly, while the hiring process has eased, the challenge lies in selecting suitable talent from an expanded pool.
What are 2 strategies that are really working for you right now and what specific impact have they had on your operations or business results?
Long Form Video is Back in Vogue? | Benjamin Mitchell - Founder | CEO at Privé Creative
"No longer worrying about the length of video ads and focusing solely on hook testing. We are seeing that longer-form videos on social are working as long as the thumb stop rate is there.
We craft the story and allow the content and editing process to play its course rather than try to squeeze it into a specific time limit. If we can provide our clients with enough hook iterations, we will find winners."
Using AI and Flexible Commerce to Scale and Adapt Quickly |Anthony Spallone - Director of Operations at Arctic Grey | Shopify Plus Enterprise Solutions
"Our current strategy centers around adopting AI-powered tools and the principles of Flexible Commerce. AI tools have significantly improved our operational efficiency by automating routine tasks and providing insights into customer sentiment. Flexible Commerce, on the other hand, has allowed us to adapt quickly to changes, experiment with new ideas, and tailor our tools to our specific needs, resulting in improved customer service and increased sales for our merchants."
Revenue Strategies that Are Working | Brandon Amoroso - Founder & CEO of electrIQ
"Creating separate transactional experiences for one-shot customers versus subscription customers. Moving our transactional communications into Klaviyo allows us to develop hyper-targeted transactional journeys that are much more relevant to the customer and help improve retention and increase LTV. With Soylent, we were able to generate a 54x ROI.
Also, showing multiple cross-sell, and up-sell offers on interstitial pages between the payment accepted and the order confirmation page. For our merchants at least 10% of customers will take advantage of one of these 1-click offers, generating free revenue for the brand."
Top Performing eCommerce Teams | Nihar Kulkarni - Managing Director, Partner at Roswell Studios
"As your agency grows, you initially hire for desire and potential - which can lead to incredible outcomes, but also not-so-incredible outcomes. As you scale, you have to pivot to hiring based on actual talent and expertise - because you can finally afford it. In this way - you adjust your operational efficiency knob higher, resulting in predictable deliverability which leads to increased merchant/client satisfaction and profitability. Understanding your team’s true delivery capacity and measuring that against the runway of projects you have in the current and future pipeline will allow you to manage your P&L and cash flow more effectively."
Pinterest as an Acquisition Channel? | Victor Ricci - CEO at Mattered
"Last year, we started to push our clients to diversify their ad spend. This was a slow roll, and most clients were a bit hesitant to start spending on a new channel like Pinterest –which lacks the hype of something like TikTok – before Black Friday/Cyber Monday. However, we've made progress, and clients who embraced diversification have had a more successful year so far compared to those who haven't."
SMS and Email Are Still King for 1:1 Relationship Building | Philip Sblendorio - CRO & Partner at AMB Interactive
"Retention marketing and driving repeat purchases through email and SMS content combined with building a more thoughtful relationship with the customer base through personalized content.
The days of blasting out product features or sales only get a brand so far, but crafting thoughtful content that speaks to the consumer helps build a loyal relationship and trust in the brand and products."
Carro's takeaway: eCommerce strategies have shifted towards more flexible and personalized approaches, focusing on customer retention, efficiency, and diversification. Longer-form video content is gaining traction, provided it offers engaging hooks. AI-powered tools and flexible commerce principles are being leveraged for operational efficiency and adaptability. Distinct transactional experiences for one-off and subscription customers are improving retention and increasing Lifetime Value. As agencies grow, there's a focus on hiring talent and expertise for predictable deliverability. Meanwhile, diversifying ad spend and building deeper customer relationships through thoughtful, personalized content are becoming crucial for success.
What's been one of the biggest challenges, setbacks, or failures you've encountered so far in 2023 and how have you responded to it?
Tracking and Customer Identification Woes | Philip Sblendorio - CRO & Partner at AMB Interactive
"Apple’s iOS updates. These privacy updates make tracking and attribution more difficult and we’ve had to build numerous workarounds for clients. Services like retention.com and opensend.com also help create additional opportunities to track and market to customers more easily." -
Employee Happiness Matters | Nihar Kulkarni - Managing Director, Partner at Roswell Studios
"Luckily, we have little to no failures this year (again - no jinx in advance), but plenty of challenges. Understanding the value of your merchant portfolio - not just from a gross monetary sense - but also from a time utilization sense - is something we have had to deal with head-on. Sometimes you have to fire a merchant/client because they are bringing down morale, or just taking up too much of your time that you can’t always bill for. Your agency is a living being and needs constant self-care. Don’t be afraid to give your agency proper grooming every once in a while - otherwise, you’ll start to see key staff members eyeing the door. If you don’t care about your staff’s happiness, they won’t care about yours."
Getting More Out Of Existing Customers Via Advocacy and Referrals | Brandon Amoroso - Founder & CEO of electrIQ
"One of our greatest challenges is helping merchants navigate through rising acquisition costs while not being a paid acquisition agency. We’ve started thinking about how we can engage our customers meaningfully to turn them into brand advocates and referrers, generating over 10% of store revenue for brands like florence by mills."
Managing Short vs Long-Term Growth | Victor Ricci - CEO at Mattered
"Aligning ourselves with clients who prioritize short-term results over long-term growth. Our focus is not on how much we can increase your Return On Ad Spend (ROAS), clicks, attributed revenue, or any other vanity metric in the first 30 days. While these short-term boosts can be achieved (usually without fail), they often come at the cost of compromised performance in the following months. Fortunately, most brands we sign understand this from the start and it doesn’t become an issue. That being said, articulating this during the sales process to potential clients with a different perspective can certainly be a blocker."
Carro's takeaway: In 2023, businesses have grappled with challenges such as Apple's privacy updates impacting tracking and the rise of acquisition costs. Companies have responded with various strategies, from creating workarounds for tracking issues, turning customers into brand advocates, to maintaining a focus on long-term growth over short-term results.
Retention was the “it” thing in 2021 and 2022. What do you think that “it” thing is in 2023?
Just Because You Use AI Doesn't Mean You're "Ahead" | Victor Ricci - CEO at Mattered
I think a lot of organizations will waste time in 2023 trying to force AI into their workflow and procedures as much as possible—when in reality it might not be ready in a multitude of ways. Just because you can now call yourself an “AI company” does not mean that your product/service offering has improved. We always try to take a long-term approach to how we do things which makes me wary of the people/businesses that jump from buzzword to buzzword. -
Optimism Around AI | Anthony Spallone - Director of Operations at Arctic Grey | Shopify Plus Enterprise Solutions
"I believe the "it" thing in 2023, which everyone would agree with, is AI and its role in the ever-evolving landscape of eCommerce; however, still unsure of the exact direction; time will tell. I also think about sustainability, particularly through the trend of "recommerce." Given the growing consumer concern about the environment, businesses that engage in environmentally sound practices and support the resale of goods are more appealing to customers, especially younger generations."
Personalization and Better Customer Experience to Unlock Retention | Brandon Amoroso - Founder & CEO of electrIQ
I still think retention is the “it” thing in 2023, but obviously, AI is a hot topic, and I already see tremendous applications of it to better personalize the customer experience in a 1:1 fashion and ultimately improve customer retention.
The Big C Word — Community! | Benjamin Mitchell - Founder | CEO at Privé Creative
"Community building! Acquisition has gotten really expensive, which explains why retention was the “it” thing for the past two years - but brands that are taking advantage of their retained customers and building a community around them will lead to stronger acquisition growth via word-of-mouth, social proof, and community lead content creation."
Zero Party Data Is Still The Best Personalization Tool | Philip Sblendorio - CRO & Partner at AMB Interactive
It’s still retention in my opinion, but with the addition of personalized content. Using zero-party data (and first-party where possible) to truly understand your audience and their needs. Having that open conversation and transparency using tools like questionnaires and telling the customer, “We only want to message you with things that interest you”, goes a very long way.
Get on the Headless Horse or Get Left Behind | Nihar Kulkarni - Managing Director, Partner at Roswell Studios
"Well at Roswell, we’ve been doing Retention Marketing since before it was a buzzword. I was the Retention Marketing department in 2018, and now it’s headed up by Emily Roberts - our VP of Retention Marketing with a team of over 10. Retention Marketing is still the “it” thing, especially as I mentioned before, merchants are concerned with diversifying their marketing mix to focus on LTV vs CAC (it should be at least a 3:1 ratio). The other “it” thing is Headless Commerce. We have several merchants moving to Shopify Hydrogen - and they understand that the first movers in their industry verticals will gain tremendous increases in their TAMS (Total Addressable Market Share) for 3 reasons:
a. Those that move first will provide faster load times, and thus a better user experience, resulting in higher conversion rates resulting in taking away orders from their competitors
b. Those that don’t move will provide slower load times, and thus a lesser user experience (even if their speed is optimized as best possible) - and as a result be deemed slower by comparison leading to customers leaving their sites and adopting the headless ones
c. Those that finally figure it out with Headless, and optimize their conversion rate even further will dump a ton of resources into the top of funnel marketing and retention marketing which will take even more market share away from their competitors
Get on the Headless Horse or be left behind."
Carro takeaway: Experts are eyeing the potential of AI, community building, personalized content, and headless commerce as the new "it" trends, but some still see retention as key. These trends highlight the importance of adapting to emerging technologies, creating personalized experiences, building a strong community around brands, and improving site load times for better user experience.
What is a bold prediction you have for the second half of 2023?
Consolidation is Looming Everywhere | Brandon Amoroso - Founder & CEO of electrIQ
"Extreme product consolidation amongst merchants. Shopify apps continue to get broader in terms of their product offering, allowing merchants to bundle multiple solutions under one roof to get cost efficiencies and also increased ease of use." -
Consolidate or Die? | Philip Sblendorio - CRO & Partner at AMB Interactive
"Many companies will shrink or go away and there will be a lot of consolidation. I believe there is a lack of transparency in the true unemployment rates, current market outlook, replacement of jobs due to AI, looming recession due to the many concessions and moratoriums put in place for Covid which could lead to the roll-up of companies and decrease in consumer spending."
Get The Gloves, BFCM is About to Be a Boxing Match | Nihar Kulkarni - Managing Director, Partner at Roswell Studios
"Fears of a recession will reduce once the market settles at the new normal of the 5.6% projected Fed rate. Brands will have to compete ferociously during BFCM, and those that invested in retention marketing strategies earlier in the year will reap the rewards as customers leverage loyalty points for increased AOV orders, convert higher with products that have numerous reviews, and email / SMS lists that are larger than their competitors. If you are not doing retention marketing - start yesterday."
Optimism Around Consumer Spending Picking Up | Benjamin Mitchell - Founder | CEO at Privé Creative
"Consumers will continue to flourish and support eCommerce growth. Even with negative headlines around the economy, we don’t believe a recession is truly in sight. Consumers continue to digest content and spend, and we will see brands scale even faster as their marketing efforts are improved by the use of AI." -
Landing Pages Are About to Get Supercharged with AI | Anthony Spallone - Director of Operations at Arctic Grey | Shopify Plus Enterprise Solutions
"My bold prediction for the second half of 2023 is the rise of AI-generated landing pages. With advancements in AI, it's likely that someone will build a technology to create unique and high-converting landing pages, able to test thousands of iterations and select the winner from a comprehensive series of A/B testing. Something that is currently not possible but could become quite easy to use with AI."
Inflated Competition Means the End for Some Brands Post-BFCM? | Victor Ricci - CEO at Mattered
"I believe some businesses will get absolutely decimated after having an unprecedentedly slow Q4. I think there are a lot of compounding elements at play that will really hurt some of the DTC brands that don’t prepare properly. Especially those who saturate all of their audiences before the holidays – these companies will not be able to compete and will miss on all of their projections due to inflated competition." -
Carro takeaway: Experts predict an era of consolidation among merchants and companies, heightened competition, and the rise of AI-generated landing pages in the second half of 2023. Some foresee the economy recovering from the fear of recession, while others anticipate a tough Q4 for unprepared DTC brands. They attribute these predictions to advancements in AI, broader product offerings, market conditions, and the changing landscape of eCommerce.
How has emerging technology (AI, blockchain, etc.) influenced eCommerce trends and strategies in 2023? Do you foresee any specific technologies having a significant impact in the latter half of the year?
AI is About to Change Search and SEO Forever | Nihar Kulkarni - Managing Director, Partner at Roswell Studios
"SEO strategies will be dramatically impacted in the near future. Currently, you type in your interest into Google, and you have 10 organic options show up with a bunch of paid ads at the top. With Chat powered search platforms, the user is in control of what appears, as their preferences are taken into context of what the bot responds with - on a 1 ON 1 conversation. The bot will not give you 10 options to think about - that’s a waste of resources and time. SEO strategies have to take into consideration that AI bots are going to be crawling the internet not just for relevant content, but content that appeals to countless consumer profiles - and as such SEO teams will need to focus their content marketing strategies in a way that blankets the internet with diverse quality content that acts as multiple level interest funnels to their store site - rather than the traditional one persona approach."
AI is Going to Change Personalized Videos | Brandon Amoroso - Founder & CEO of electrIQ
"Windsor has been a game-changer for Electriq in allowing us to create personalized videos at scale for our client’s customers. You’re able to record videos that autogenerate with dynamic information about the customer with their AI technology, allowing us to send hundreds of thousands of personalized videos in abandoned cart flows, email campaigns, etc. I see a lot of applications for this outside of email as well." -
AI Will Disrupt Commerce, Just Not Yet | Victor Ricci - CEO at Mattered
"At this point, I genuinely do not think AI has had any truly noticeable impact on eCommerce but I am certain it will in the very near future. iOS 14, open rates, cookies, and algorithm changes have all had a significantly greater impact in a much shorter window, virtually overnight.
I believe that AI will disrupt eCommerce by reducing the amount of time, effort, and capital it takes to take a product or service to market, which I think will help lower the barrier to entry—and that is a generally positive change that I look forward to. I am a big believer that the more “at bats” you give someone, the more likely they are to hit a home run. I hope AI allows everyone the opportunity to take a swing—or multiple." -
Goodbye Fraudsters, AI to the Rescue | Anthony Spallone- Director of Operations at Arctic Grey | Shopify Plus Enterprise Solutions
"Emerging technology, particularly AI, has greatly influenced eCommerce trends in 2023. AI-powered tools have made processes more efficient and insights more accessible, from chatbots answering customer service requests to AI algorithms optimizing product listings. As we move into the latter half of the year, I foresee AI continuing to play a significant role in eCommerce, with potential advancements in fraud detection and prevention, as well as conversion rate optimization and bringing A/B testing to an entirely different level."
Carro's takeaway: Emerging technologies like AI have significantly influenced eCommerce in 2023, enhancing efficiency and accessibility. AI has enabled chat-powered search platforms that offer a personalized user experience, and also supports the creation of personalized videos at scale. However, some experts argue that AI's true impact on eCommerce is yet to be realized, anticipating that it will eventually reduce the time, effort, and capital required to bring products or services to market. As we proceed into the second half of 2023, AI's role in eCommerce is expected to evolve further, with potential advancements in fraud detection and prevention, conversion rate optimization, and A/B testing.
With merchants looking for ways to lower customer acquisition costs and expand sales organically, many are turning to collaborative commerce (i.e., cross-store selling, creating a marketplace of complimentary products, etc…). How important do you think it is for merchants to explore collaborative commerce as a way to grow their business for the remainder of 2023?
Grow Average Order Value and Conversion Rates | Brandon Amoroso - Founder & CEO of electrIQ
"Collaborative commerce is a no-brainer for me. For starters, it allows you to easily test into new product categories and verticals without investing in your own inventory. If you see a strong response from your customer base, then you can always go out and develop your own.
We’ve also seen it work very well as a means of increasing conversion rate and AOV for our merchants, such as Wine Insiders, where we offer complimentary products for free, such as a decanter or corkscrew if customers pass a certain spend threshold or bottle count."
Risk Free Merchandising | Philip Sblendorio, CRO & Partner at AMB Interactive
"This is a big topic for our clients. Using tools like Carro and Amazon is essential for expanding reach and increasing product mix without the cash flow constraints of testing new colors, products, etc. We are also seeing a lot more collaboration between companies, even if vastly different, to launch new products and cross-market to raise awareness for each brand between audiences. The power of these marketing campaigns is much more impactful to go viral, which is essential for organic growth in today’s environment."
Connect With Your Customers On Another Level With a One-Stop Marketplace | Nihar Kulkarni - Managing Director, Partner at Roswell Studios
"This is an interesting and emerging trend. Brands understand that they don’t sell everything your customer wants - they aren’t Amazon, nor do they want to be. But again — customers want value over cost. Creating on-site store collaborations with complimentary products that go well together — even if they are not yours — is a way that you can convey to your customers that you get them, you get their needs, and you are delivering on that. We have several brands that are collaborating with creators, other brands, and sometimes seemingly unrelated products. Do you sell protein bars? Why not give a gift with the purchase of sample packs of protein powder from a prominent brand — and ask them to do the same for you?"
Grow Organic Sales With Ease | Anthony Spallone- Director of Operations at Arctic Grey | Shopify Plus Enterprise Solutions
Exploring collaborative commerce is crucial for merchants in 2023 as it provides opportunities to lower customer acquisition costs and expand sales organically. One effective example of this is cross-store selling, where businesses partner with complementary brands to broaden their product offerings, reach new customers, and increase sales. I believe businesses that can successfully incorporate collaborative commerce into their strategies will see significant growth for the remainder of the year. Carro does a great job at this and makes it really easy to sell products from similar Shopify stores with ease.
Reduce Customer Acquisition Costs | Benjamin Mitchell - Founder | CEO at Privé Creative
"Collaborating with other businesses is an excellent way to expand acquisition efforts and lower costs. The logic is simple: direct impressions to pre-qualified online shoppers. Aligning two brands that complement each other should result in high conversion rates and high average order values (AOV’s). This strategy is a throwback to the dedicated email drops and list-swapping strategies from 10 years ago, but can now be even more effective with the surplus of data from Shopify and automated segmentation tools, often powered by AI.
Separately from direct collaboration between two brands, there has been an explosion in marketplace development. Think of a cute little shop that you might come across in a small town that sells tchotchkes, gadgets, and hard-to-find items - but it’s online. This is a great way for people to essentially become drop shippers for non-dropshipping brands, highlight their hero products, and curate their own collection of cool products. Brands can opt into marketplaces and allow others to feature their hero products for a bounty - just like an affiliate campaign."
Green Space Opportunity for Growth | Victor Ricci - CEO at Mattered
"Collaborative Commerce is incredibly important and underutilized. Part of the strategy we have seen the most success with has been implementing exactly this tactic on Pinterest (organic not paid). We want to create the best content and boards out there... that's simply not possible by featuring only one brand. Aligning with other brands via social, on-site, or co-branded campaigns is one of the biggest areas of green space for brands to run into right now. Obviously, Carro has proven nearly invaluable for countless brands seeking to reach their exact customer demographic. With a much lower barrier to entry than the Pinterest strategy, Caro and other platforms are making it a no-brainer for brands to at least test a collaboration strategy – especially knowing Q4 is around the corner! "
Carro's takeaway: Collaborative commerce is crucial for merchants in 2023, helping to lower acquisition costs and increase organic sales. Examples include cross-store selling and complimentary product offerings, which boost conversion rates and average order values (AOVs). Successful use of these strategies can drive significant growth in the latter part of the year.
Looking to the Final 180 days of 2023 🔮
In summary the eCommerce landscape is undergoing transformative changes fueled by artificial intelligence, customer retention strategies, and the rise of collaborative commerce. While there's an ongoing push towards leveraging AI, its effectiveness is still largely dependent on appropriate integration and readiness. Furthermore, retention marketing continues to play a critical role, and collaborative commerce offers a promising avenue for organic growth and customer acquisition. Amid these changes, it's paramount for businesses to adapt, innovate, and stay customer-centric. As we look ahead, Carro is confident that these evolving trends and strategies will drive a new era of eCommerce growth, strengthening the industry and opening up unprecedented opportunities for merchants globally.
Thank you for reading our first Carro Agency Partner spotlight - we hope you found these expert insights valuable!
2023 is shaping up to be a pivotal year for countless DTC brands and that's why we're devoted to continuing to provide the DTC community with expert insights and learnings like the ones above.
You can expect to hear from more industry experts throughout 2023 on all things DTC, Shopify, and growing and scaling amazing eCommerce brands.
A big thanks to our experts for joining us in this recap. Please give them a follow and learn more about their agencies below
Brandon Amoroso - Founder & CEO of electrIQ
Philip Sblendorio - CRO & Partner at AMB Interactive
Nihar Kulkarni - Managing Director, Partner at Roswell Studios
Anthony Spallone - Director of Operations at Arctic Grey | Shopify Plus Enterprise Solutions
Benjamin Mitchell - Founder | CEO at Privé Creative
Victor Ricci - CEO at Mattered
Looking for the cheat code to increase sales in 2023?
Your customers are buying products that complement yours in the next browser tab. Stop sending them down the street and instead sell both in your store and get the complete sale.
Carro is the connective tissue between eCommerce platforms and the rest of the internet, so anyone can sell products from the world’s best brands without risking capital, inventory commitments, or handling fulfillment.
Sell blenders? Why not sell all the ingredients that go into it like BlendJet did and saw an 83% lift in AOV and 71% lift in LTV.
Want to rapidly expand your product catalog so you can keep customers coming back to buy again and again? Why not plug in Carro and add 10s 100s or 1000s of products to your catalog with just a few clicks like Gear.com did.
That’s the magic of Carro’s collaborative commerce platform. Open up endless revenue opportunities with risk-free merchandising.
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