How to build a successful e-commerce business?
This year, 16 e-shops fought their way through to the finals at Mastersgate Conference. Their assessment by a jury was open to the public at the premises of our HubHub in Bratislava for the first time. The whole conference was opened by e-HUBHUB Day.
The MastersGate conference associated with the MastersGate Awards contest, where hundreds of e-shops run for the top in four categories – Bricks to Clicks, Exporters, Rising Stars and Business to Business with the possibility to win special prizes such as Wild Card and The Greatest Investment Potential Awards is surely of great interest to businessmen, managers and people who are considering online business.
MastersGate is a year-round programme to promote e-shops development and their expansion abroad. Finalists compete for mentoring and prizes from partners to help them maximize e-commerce profits.
You will meet interesting speakers from Slovakia and around the world at the MastersGate event, you will hear a lot of inspirational stories of e-shop founders, you can sit at the Round Tables with e-commerce experts or take part in the so-called. Business Lounge, a workshop for business and leadership growth.
This year, 16 e-shops fought their way through to the finals. Their assessment by a jury was open to the public at the premises of our HubHub in Bratislava for the first time. The whole conference was opened by e-HUBHUB Day.
In addition to evaluating the finalists and selecting the winners, the participants were able to take part in consultations and networking with partners and guarantors of the conference or MastersGate Evening Talks, case studies and panel discussions with guarantors.
How to start e-commerce business? Three MastersGate Awards judges have revealed to us what they value most in the winner of their category and have provided us with useful advice for all entrepreneurs and start-ups looking for an investor, wanting to expand or move into the online world.
MastersGate guarantor and judge in the category Greatest Investment Potential – Ján Búza, HUBHUB
When should an e-shop consider the possibility of cooperation with an investor and when should the e-shop try it without help?
It depends on the fact on what the e-shop actually needs the investment. For example, cheaper forms of money are more affordable for financing inventories. On the other hand, if it needs to finance expansion into new segments or countries, bank financing will probably be difficult to access.
At what stage should it reach out to the investor? What will the investor be interested in?
This depends on the type of investor. Some specialise in early stage projects and invest in tens of thousands of euros, others will not invest if their investment is not in millions of euros. The areas that will be of interest to them will also depend on the project stage and the type of investor. In the early stages, it is rather the quality and potential of the idea or team behind it. If the company is in the growth phase, it will be mainly about the growth rate and the expansion strategy. When it comes to established business, investors will be more interested in profitability, acquisition potential or long-term strategy.
What do you appreciate the most about the category winner?
It was rather challenging to choose a winner, as several candidates came into consideration, depending on what criteria we would choose. As far as the company Zajo is concerned, I appreciate the fact that it has been able to find a large enough gap in the fashion market and expand despite strong global competition. At the same time, they chose a suitable strategy of the combination of so-called flagship stores combined with investing in their own e-commerce solution, which is in line with the growing “direct-to-consumer” trend, which is pursued by global fashion brands as well.
As for the inspiration for others, I think that it is necessary to have a well thought out product and a distribution channel and then you can start thinking about international expansion. Otherwise, you risk a very expensive lesson.
Judge in the Bricks to Clicks category – Jakub Čech, Daren&Curtis
What are the best communication strategies to get a good position in the online environment?
First and foremost, you need to know your product thoroughly, its benefits that will be of interest to a defined target group, and it must be willing to pay for the products a set price with a favourable margin for you. Then you need:
- a fitting idea built on target group “insights” and communicating a clear “reason why” of the product or service,
- various creatives for target group micro-segmentation + tailored “storytelling” based on the individual stages of the purchasing process,
- media planning and effective targeting using relevant data from multiple sources,
- real-time optimisation media spending according to goals achieved, keeping channel synergy.
Three recommendations for the success of the transition from “offline” to “online”?
- Be searchable, so beware of the so called good onpage SEO to make the most of your organic traffic. And run at least a basic search campaign on Google Ads.
- Have a quick and clear website so that the visitor can navigate well and find what he or she is looking for as soon as possible. The web should be an assistant on the shopping trip, not to make it harder.
- Remind the public of you! Since an average customer needs 8 to 12 interactions for a non-impulse purchase, have your remarketing campaigns set up to remind people of you at reasonable time frames and motivate them to buy.
BONUS: Test targeting, test channels, test the creative aspect! What worked for others may not work for you, and vice versa.
What do you appreciate the most about the winner of the Bricks to Clicks category?
DUOS is a prime example of how well-run established business breaks into the online environment and affects the market. I especially appreciate the visual communication of the brand on social networks where you can expand your brand and create a customer community for very reasonable budgets. In the fashion – eyewear segment, the influence of influencers is undeniable, we see obvious results. This is what DUOS is aware of and devotes energy in this direction, which I value positively. I was also impressed by the innovative technology plans of the company regarding which I keep my fingers crossed for them and I believe that the win in MastersGate will help them fulfil these plans.
MastersGate guarantor and judge in the Exporters category – Pavol Adamčák, ui42 digital
What are the best communication strategies for expanding into a foreign market?
As the best communication channels can be considered Google and Facebook. In addition to these two players, price comparators are also appropriate for certain segments. Thanks to them, e-shops can test their products on the foreign market and thus to check the demand for products before “real” entry into the given market. Although comparators are not established everywhere in Europe on the same good level as in Slovakia, Czech Republic, Romania, Poland, Hungary. However, where price is not compared, product aggregators can work for segments such as furniture, clothing and the like. Such aggregators are also Favi or Glami.
In addition to Google and Facebook, Emag (a selling platform in Romania) is also an interesting platform. Towards the west, it is Amazon (Germany, United Kingdom, USA). Emag and Amazon are more selling than communication channels. At the same time, you can test demand for your products via Emag and Amazon.
To sum up, the choice of channels depends mainly on the market I want to enter and the products I want to sell.
What to pay the most attention to: measure twice and cut once. A poorly chosen market, or even the inability to recognize the failed market choice, can make e-shops very exhausted. So, do not succumb to stereotypes and the idea that Romania and Hungary are promised countries for every e-shop. Every market has its own specificities, so we recommend that you do a really good analysis before the “expansion”. Or consult an expert (agency, other e-shop) who sells and operates on the market.
Three recommendations for a successful expansion?
Strategy – we recommend having a strategy (to create an analysis of the foreign market to which it makes sense to enter with an e-shop). Not only from the point of view where I want to go, but also: where it is worth going. Considering factors such as demand, or competitive situation in the given market. You need to define a plan, test product demand, choose suppliers and partners with experience.
The most valuable information will always give you a marketer, a native of the market. Look for ways to meet these people. Conference for e-shops, networking with other e-shop owners, cooperation with agencies with an international team – all this should be on the agenda of an export-tuned e-shop. Mastersgate’s vision is to be just the place where the owner of an e-shop can meet specific practitioners and discuss important information that can affect the future of the e-shop while informally drinking coffee or beer. We encountered these situations that the e-shops have dealt with: How did you create language translations? Who do you do logistics with in that country? How did I work without a country manager? Who covered my country marketing? What didn’t work for you?
What do you appreciate the most about the Exporters category winner?
It is really difficult to answer this question, because we are talking about permille that ruled in favour of the winner among the finalists (all finalists had a very interesting story, a vision and a plan they would like to implement). Pelikán is a project that differs from other e-shops just by not having logistics services and centres. So, it can grow quite quickly, without “traditional barriers”. However, what we most appreciate about the winner (Pelikan.sk) is the complementarity, creativity and innovation of the services and products it brings to the client.
How can the winner be an inspiration for other e-shops?
They may inspire other “traditional” e-shops by not trying to directly attack Google-type global giants but seeking out vacant positions on their market. They are creative in connecting holidays and airline tickets to improve the overall experience and bring destinations, and thus products that you will not find elsewhere. They build future sources of income alongside the primary business source. Thus, in addition to selling tickets, they add accommodation or another experience.
We would like to thank all three MastersGate Awards 2019 judges for the interview. We believe that we have managed to convey useful know-how from the online business environment to you and that we are seeing you at MasterGate next year.
Who are the MastersGate Awards 2019 winners?
- Bricks to Click – DUOS
- Exporters – Pelikán
- Rising Stars – Florbal4u
- Business to Business – KOMPRESORY-VZDUCHOTECHNIKA
- The Greatest Investment Potential prize – ZAJO
- Wild Card prize – ECOBAL
Who were the jury members at MastersGate Awards 2019?
The seven-member jury of experts consisted of the chairman of the jury, the organiser of the competition Martin Krupan from ui42 and other specialists:
- Bricks to Clicks – Jakub Čech, Daren&Curtis,
- Exporters – Pavol Adamčák, ui42 digital,
- Rising Stars – Dalibor Cicman, GymBeam,
- Business to Business – Martin Volek, Volis International
+ 2 professional guarantors: Ján Buza from HubHub and Patrik Pajtáš from Slovenská sporiteľňa.