Scale with ECommerce Product Innovation and Sourcing

February 16, 2022

8fig_Scale-with-Product-Innovation-hero

8fig Team

Creating a quality product that also stands out from the competition is a daunting task. This is why in eCommerce, the beginning is often the hardest part. After all, a lot of unknown variables come with launching a product and you’ll rely on a lot of external partners to achieve results.

As a founder, constantly learning and trusting your data are two ways you can get ahead, and we’ll show you how to do both with tips from our recent webinar: Scale with Product Innovation and Sourcing.

We sat down with experts Nathan Resnick of Sourcify, Benjamin Hopwood of Gembah, Sajag Agarwal of Movley, and Liran Hirschkorn of Incrementum Digital to discuss how to kickstart innovation, vet suppliers and partners, and master your product journey at any stage. Read on or click here to watch the full webinar on YouTube.

In this blog we’ll cover how to:

  1. Build a community around your product
  2. Validate your product-market fit with data
  3. Test your marketing before launch
  4. Work with experts to expand your product knowledge
  5. Define your supply chain quality control process
  6. Consider your risk threshold when evaluating markets and suppliers
  7. Foster supplier Relationships with trust, rigor

 

1. Build a Community Around Your Product

Creating an emotional connection between product and customers is what sets memorable brands apart from the rest. Social media lets you build community and connection in a digital space, allowing you to engage with your current and future customers easier than ever before.

Community building can start at the very beginning of your product journey. “Right now I see a lot of brands that have partnered with celebrities or influencers to create a community around their product,” Nathan Resnick of Sourcify explains. “If you have an existing community that you can tie to a product or if you have a connection to a large celebrity or influencer that you can develop a product with that will target their audience in a great way that’s going to be a huge win.”

Glitch Energy, a supplement brand that launched in 2021 and skyrocketed to 7-figures, brought a Youtube influencer on as its third founder to leverage his audience. Rather than paying for advertising, they have been able to drive massive organic growth using Wildcat’s Youtube following. And because he has in-depth knowledge about the product and a vested interest in promoting it, his marketing comes off as more authentic than a common influencer campaign. Read more about their 7-figure growth here.

Another way to leverage community is on the product development side. If you’re looking for a new product to launch but not sure what problem to solve, join online groups to ask users about pain points in their everyday lives.

Sajag Agarwal of Movley provided an example of how to use social media forums to identify pain points in specific niches: “I had a friend who started a dog products company. He actually joined a bunch of Facebook groups for dog owners and asked: What’s the biggest problem you guys have with dog products, and then started running a lot of questions and ended up with this awesome product that sold like crazy.”

2. Validate Your Product-Market Fit with Data

As creators, it’s rewarding when you can build a product that you’re passionate about and proud to promote. But don’t fall into the trap of thinking that an idea that is exciting in your head will always translate into real-world sales. Instead, conduct research and use this data to make key decisions around product-market fit, advertising strategy, and sales forecasts.

“The area where I’ve seen people fail is having that innovative idea but then not backing it up with data and not doing the research [to find out] do people actually want this product, is there actually a need for this?” Liran Hirshkorn of Incrementum Digital explains.

For example, if you’re selling on Amazon, a product that isn’t tied into search volume will struggle to make waves on the platform. Take it from someone who has been there: Alex, a 6-figure Amazon seller who had a few unsuccessful launches before finding her hero product line, vowed she would never again try to sell an Amazon product without search volume after trying and failing multiple times.

It’s also important to understand your true cost of goods sold when evaluating your store’s performance after launch. Are you profitable enough to scale, or are you breaking even or losing money after factoring in things such as advertising and returns?

3. Test Your Marketing Before Launch

You may come up with the best product idea in the world, but if it’s not marketed correctly you’ll never make a sale in the competitive world of eCommerce. This is why it’s so important to test your marketing before your official launch.

You can test everything from your product images to your marketing copy to a small audience, and then you can make data-backed decisions on what to include in your listing and ads.

Testing your product marketing doesn’t have to break the bank, either. For example, you can run Facebook ads featuring 10 different product photos to see which has the highest engagement rate. Voila! You know which product photo performs best with users. There are also A/B testing tools that let you try different copy and imagery to learn what converts.

Nathan Resnick of Sourcify uses product samples to validate products and marketing before placing PO’s. He explains: “One way I’ve tested products before launching brands is by getting half a dozen samples from a factory before actually placing a PO and actually running the brand with those samples and testing the marketing to see if the funnel or the ad makes sense and to see if the brand connects with the community.

4. Use Experts to Expand Your Product Knowledge

It takes an estimated 10,000 hours to become an expert at something. If you’re an eCommerce founder, you won’t have that many hours to put into every part of your business. But there are ways to level up your knowledge fast so you can innovate constantly and capitalize on trends.

One solution is to hire an expert who already knows the answer to your question. “Adding in an expert at the right time of your product journey can oftentimes save you weeks, if not months, of trying to figure something out,” Benjamin Hopwood of Gembah explains. But he also points out that this expert doesn’t need to become a permanent fixture on your team. “This isn’t somebody that needs to be on your team permanently, it’s somebody that can help you where you need it, and then you can continue to move on.”

Bringing in engineers to weigh in on your product development and testing can also help you get a gauge on your quality control early on in the product journey. Find out which pieces of the product may break in the future or what material could become short in supply so you know your vulnerabilities and your strengths.

There are a number of ways to find experts in your product category and online platforms make it easier than ever to connect. It may be as easy as following a key Twitter hashtag in your category to see who is constantly speaking on the subject, or hiring someone from Upwork.

5. Define Your Supply Chain Quality Control Process

In order to get repeat customers and scale to 8-figures and beyond, quality control is key. In the world of eCommerce, you may not ever touch the product that you’re selling but you need processes in place to ensure that your customers are happy with their purchases.

Some brands, such as Spikeball, have invested so heavily in quality control that they can offer lifetime guarantees on their products without worrying about their bottom line. So how can you get your brand to a similar place?

“I like to ask open-ended questions about a factory’s quality control, their management, and how they handle processes. The ones that have good protocols in place will have machinery there such as labs and equipment to test for that kind of quality on the production line,” Sajag Agarwal of Movley advises.

A lot of times quality control also means turning down the cheapest offer, however tempting it may be. “Sure a supplier might be 20% cheaper, but that 20% could cost you your entire brand,” Movley adds.

Supplier scorecards can come in handy as a consistent measurement for quality control. This allows you to evaluate your supplier month after month and ask important questions like are things always delivered on time and in good conditions, or have vulnerabilities presented themselves and why?

6. Consider Your Risk Threshold When Evaluating Markets and Suppliers

Over the past few years, trade wars and supply chain delays have given new markets leverage to compete with China in bigger ways. There isn’t a right or wrong answer on what this competition means for future production, but our panel of experts advised against making rash decisions based on headlines alone.

Instead, understand who you are as an entrepreneur and what risks you’re willing to take with your supply chain.

If you want to explore a new market such as Mexico, are you also comfortable with having less infrastructure in place? Are you open to helping the factory build quality control protocols that don’t yet exist? If you’d rather focus your energy on product innovation and brand building rather than your supply chain, you may want to stick to a well-oiled machine rather than working with someone in a new frontier.

“You have to decide as a brand and as an entrepreneur, do you like being on the frontiers to get those rewards, or are you somebody who wants to focus on a different part of your product and have a very stable supply chain?”

Also remember smaller companies usually follow bigger sellers into new markets, as bigger sellers have more capital to help build out infrastructure. You can build a supply chain in China today but move it in a few years as emerging markets get more evolved, as Movley points out. “It’s not an all-or-nothing decision today. In a year, when there’s more infrastructure in Mexico, or Vietnam or elsewhere, and it starts looking more attractive and more stable for your business, you can always move production to those countries.”

7. Foster Supplier Relationships with Trust, Rigor

You’ve found a supplier that you trust and now the real work begins. Both in Asia and all over the world, relationship building is key to successful partnerships. Spending time fostering connection can get you faster shipping, better costs, and a strategic spot on the production line.

“Guanxi is such a deep term in Asia but it basically means relationships and how you establish and build and develop your relationships, in this case with your suppliers,” Nathan Resnick of Sourcify explains. “You can send a gift as a nice gesture wishing them happy holidays, or happy birthday, all of those little things really go a long way to develop Guanxi.”

Chinese New Year, an event that takes place in Q1 each year, is a key time to celebrate overseas partners who reside in Asia. Don’t miss this opportunity to impress with a nice gesture.

Remember also that relationship building goes both ways. As you grow, your quality control will be more important than ever so having rigorous processes in place with your suppliers will be vital. The more success your brand sees, the more vested interest your suppliers have in working with you as well. This puts you in a position to negotiate costs and terms, as well as quality control, so you and your partners can grow together.

Above, we outlined the importance of community, relationship-building, quality control, and data when developing and marketing your product. Our panelists work at companies that can help at each stage of your journey: Gembah on taking your product from concept to market, Sourcify on sourcing best-selling products, Movley on securing quality control for your supply chain, and Incrementum Digital on growing Amazon sales through advertising.

Here at 8fig, we help eCommerce founders scale their successful product launches so you can grow to new heights. Our Growth Plans map out your supply chain strategy and infuse continuous capital at every stage and you can get started here.

Now, let’s get you to 8-figures.

8fig Team

8fig Team

The 8fig Team is an experienced group of eCommerce writers and experts committed to helping online sellers grow their businesses through informative content and guides. Whether you're looking to increase sales or build your brand, we have the knowledge and expertise to help you succeed.