E-commerce continues to grow rapidly, significantly shaping the global consumer experience. In 2024, there are approximately 2.71 billion online shoppers globally, representing about 33% of the world’s population, marking a 2.7% increase from 2023. Their online purchases now account for 20.1% of total retail sales worldwide, slightly higher than the previous year, with this share projected to grow to 22.6% by 2027. By 2040, over 95% of all purchases will be made online, underscoring the long-term dominance of e-commerce.

Add to these figures the changes in consumer behaviors and preferences brought about by the sudden and rapid spread of COVID-19 and it is easy to see the massive opportunity for e-commerce retailers.Yet in the face of increased competition, larger ad spends, and potential uncertainty in global markets, e-commerce retailers will need to leverage data and innovative digital marketing tools to capitalize on these unique opportunities. In this digital marketing playbook, we’re looking at some of the e-commerce marketing tools and methods you can use to really step up your game. Remember that a big part of making money online doing anything is understanding marketing.

E-commerce challenges

One of the biggest challenges of e-commerce is understanding your audience and being able to show them the right advertisement at the right time. The point of this marketing strategy playbook is to help you gain a better understanding of how marketing and e-commerce work together.

Unfortunately, success in e-commerce marketing is not as simple as running several ads or driving a larger number of visitors to online stores. Rather it is about showing the right advertisement to the right user at the right time and on the right channel. And then there is the fact that you need to do it better than your competitors, provide a superior shopping experience to actually close the deal, and maintain the trust of your customers to keep them coming back.

Let’s look at some of these challenges in more detail.

What are the Biggest Challenges of E-Commerce?

1. Dealing with competition

With e-commerce offering vast opportunities, it’s no surprise that the competition is fierce. Retail remains the leader in digital ad spending, holding 20.1% of the annual total in the U.S. in 2024. While its share has dipped slightly, retail’s ad spend is set to surge to $84 billion this year, reflecting a robust 14.2% growth from 2023. The gap between retail and Consumer Packaged Goods (CPG), now the second-largest vertical, has expanded, with CPG expected to spend $49.95 billion, creating a striking $34.05 billion difference.

Meanwhile, online retailers are revamping their advertising methods. The once-standard balance between display and search ads is shifting, with social media and video advertising gaining prominence. Social platforms now outshine email and organic search as the go-to channels for content promotion. Moreover, video ads—ranging from short clips to live streams and interactive formats—are becoming indispensable tools for engagement.

The cost landscape for e-commerce advertising has also undergone substantial change. Depending on the industry, marketers might spend an average of $2-$4 per click, though sectors like legal services and finance see these figures climb to $50 or more per click ($50 or more per click). Platform-specific rates vary widely, with Google Search Ads averaging $2.32 per click, Facebook Ads at $1.35, and Instagram Ads at $3.56. However, higher budgets alone are no guarantee of success. Factors like ad relevance, optimized landing pages, and smart keyword targeting are critical for maximizing returns.

To achieve meaningful results, marketers should embrace a more strategic approach. Email marketing, for instance, delivers an impressive ROI of $38 for every $1 spent, while prioritizing mobile optimization is crucial, as mobile ad spend is projected to exceed 70% of total digital ad spend by 2025. Additionally, video content continues to grow in influence, with projections showing it will account for 82% of all internet traffic by 2026.

2. Identifying and reaching your target audience

Many e-commerce ad campaigns fail because they do not identify and reach the correct target audience. A target audience is a group of potential customers that are likely to buy a product or service from you. Your audience generally shares common attributes like geography or demographics.

It is essential to conduct research at the outset to define your audience. Moreover, you must gather and analyze customer data to refine your target audience over time. For example, by using customer data integration tools you can extract data from all customer interactions into a single platform to provide a holistic view of who your customers are. First-party behavioral data that you collect with MetaRouter can be analyzed and interpreted by a customer data platform, producing segments that are more useful than those created from traditional demographic data. 

3. The customer experience and conversions

As more and more customers turn to online shopping, they expect innovative and enjoyable experiences. The customer journey now spans multiple channels. A customer might encounter a product on a social media platform. Research that product on a mobile device. And ultimately purchase it at a later time on a laptop. Omnichannel marketing will become the new e-commerce norm. Again, using customer data integration tools to seamlessly track customer behavior across devices will prove indispensable.   

E-commerce, more so than other verticals, experiences notoriously low conversion rates. Research shows that the average conversion rate for e-commerce websites in 2020 is 2.86%, significantly lower than the global website conversion rate of 4.31%. A big challenge that e-commerce retailers face is abandoned shopping carts. Some 69.57% of customers leave a website without purchasing the items saved in their carts.

While a large portion of that number is attributable to customers that are not ready to make a purchase, other factors like poor checkout experiences and a lack of transparency cost retailers countless dollars each year. Digital marketing tools like abandoned cart follow-up emails can play a significant role in recapturing a percentage of these lost sales.

4. Retaining customers

Many e-commerce marketers make the mistake of overlooking their current and former customers. Yet research shows that about 1/3 of consumers would rather buy from a website they have bought from previously. In addition, a poor customer experience will overwhelming lead to a customer shopping elsewhere (80% of respondents).

So, marketers must utilize digital marketing tools that keep customers engaged and coming back, and retailers must provide excellent customer service to avoid the loss of repeat business.

The Marketing Strategy Playbook: Choosing the right partners and digital marketing tools

Retailers are often overwhelmed by the sheer number of e-commerce solutions and vendors out there. It is a matter of finding the ones that work best to help your company meet its unique needs and challenges. For example, when selecting customer data integration tools, it is important that the solution integrates with the third-party tools and platforms that you use.

E-commerce marketing tools

Taking your e-commerce marketing strategies to the next level is about leveraging the right digital marketing tools. Here are some tools that you can begin using today to drive quality traffic to your website, provide superior customer experiences, and get the most out of your data.

Chatbots

Chatbots are a powerful automation solution that ecommerce stores use to streamline workflows and provide excellent customer service. They are powered by artificial intelligence (AI) and can generate leads, provide 24/7 support, and even upsell and cross-sell other products or services.

When implementing a chatbot solution, it is best to start small. Identify your goals and consider what basic features you want it to have. Choose a chatbot platform that allows you to customize it to meet your needs. It is important to test your chatbot extensively prior to launching it in real-time.

Even then, expect there to be some issues. Make improvements as needed and continue to monitor your chatbot for areas that can be fine-tuned. Consider adding more complex features and capabilities once you have acquired some experience and eliminated operating issues. 

Some of our favorite chatbot solutions:

• Drift
• Intercom

Two of our favorite chatbot solutions are Drift and Intercom. Drift provides chatbot tools that are fully customizable and easy to implement. They provide advanced direct targeting features and industry leading customer support. Like Drift, Intercom offers companies simple code-free customization to design bots that meet their unique business needs. Intercom’s chatbot solutions connect directly to existing tech stacks, helping companies to automate their processes.

Customer Relationship Management Software

Managing and utilizing customer data is an important part of this ecommerce marketing guide. You need to capture the right data and know what to do with it when you get it. This will not only help you stay organized but it’ll help you track success and scale faster once you know what works and what doesn’t.

Customer relationship management software (CRM) allows you to manage all your contacts while leveraging data to build comprehensive customer profiles. CRMs help to increase sales through automation and omnichannel communications. They also aid in customer retention since merchants can provide better customer support and regularly engage users across devices.

Perhaps most importantly, CRMs provide superior customer data management features. With a CRM you can identify common attributes among your customers for use in future marketing campaigns. Moreover, you can segment customers by attributes to provide highly targeted and relevant advertisements that drive sales.

Our picks for CRM software solutions

• HubSpot
• Braze

Our two favorite CRM software solutions are HubSpot and Braze. HubSpot is well known throughout the digital marketing world. They offer a free version that may include enough features for small business owners. HubSpot has also recently added a new content management system to its platform that gives users even more tools. Braze helps businesses to streamline their communication with their audiences across multiple channels based on factors like user behavior and custom data points.

Paid Media Marketing Campaigns

Running paid media marketing campaigns on both search engines and social media are a powerful way to drive high quality traffic to your online store. Marketers can leverage the big data capabilities of platforms like Google and Facebook to deliver highly targeted ads. For example, targeting parameters include demographics as well as psychographic factors like interests, hobbies, and personality types.

Paid digital marketing ads are also cost-effective and can be tailored to fit any budget. Consider that the average price-per-click across all industries for Facebook ads is just $1.72. The best strategy is to start small. Create a campaign with no more than 15 or so keywords. The reason is that when running test campaigns if you incorporate too many keywords it is difficult to gather meaningful data.

Run your ad campaign using a limited initial budget to gather data. Identify which keywords are performing best. Exclude keywords that are performing poorly. Identify the attributes of the users clicking on your ads. Use this information to expand your keyword list and to target users in future campaigns.

Paid media marketing requires continuous data collection and analysis, and adjustments to campaigns to improve results. With customer data integration tools, marketers can analyze data across all channels to drive superior performance. One of the greatest ecommerce digital marketing strategies to deploy is one that marries many of the methods outlined in this marketing playbook. Using just one of these is a great way to get started but the best marketers use a combination of all of them.

Some of our favorite paid media marketing tools

• Google Adwords
• Facebook
• Taboola
• Outbrain
• Acquisio

Google Adwords dominates when it comes to search ads, controlling about 70% of the market. Those new to Adwords can learn how to use the platform through free training courses provided by Google. Facebook is the largest paid social media platform. The platform provides an extensive set of targeting features. Users can learn more about their audience, as well as implement retargeting campaigns, by installing Facebook Pixel on their website.

Businesses can also use Taboola and Outbrain to advertise to their audience on relevant third party websites. Or a tool like Acquisio to simplify campaign management through artificial intelligence.

Business Intelligence Dashboards and Data Storage

A business intelligence dashboard (BI) is a powerful tool that is used to create data visualizations based on key performance indicators (KPI). BI dashboards are fully customizable, allowing ecommerce marketers to display data relevant to their products or services. Effective BI dashboards include an easy to use interface and allow users to integrate data from many different third-party sources.

The primary goal of a BI dashboard is to take complex data and display it in a way that facilitates informed decision making. For e-commerce marketers, this means viewing the performance of different ads, products, and offers; as well as compiling customer profiles and determining their ROI. Perhaps most importantly, data must be securely stored and accessible by your team at any time and from any location.

Some of our favorite BI Dashboards:

• Resonate
• Google Analytics

Resonate is a powerful tool that allows users to integrate data from many third-party apps. This data can be used to create highly detailed reports based on the selected metrics. Google Analytics is a free solution that allows users to represent and view data in ways that are easy to understand like charts, lists, graphs, and pie charts. The best part is it is completely free.

Search Engine Optimization

Many ecommerce marketers make the mistake of focusing exclusively on paid media marketing strategies to drive traffic to their online stores. While this strategy does offer excellent returns, they are missing out on a significant segment of potential customers that visit stores through organic traffic.

Search engine optimization (SEO) is a method that digital marketers use to rank well on search engines. Being successful at SEO requires consistency and adhering to certain best practices. For e-commerce marketers, some best practices include:

• Researching and incorporating high value keywords
• Offering user-friendly website and landing page designs
• Incorporating alt text, metatags, and shortened URLs
• Allowing customer reviews for social proof
• Having a social media presence
• Regularly creating original content
• Being sure to reduce tag bloat

One of the best ways to increase organic traffic is by writing keyword optimized content that is both informative but designed to rank well on search engines. In addition to conducting thorough keyword research, you need to also develop a website with a strong reputation, have plenty of social proof, and ensure that your content is actually helpful and valuable to the readers. Doing so will show Google you are an expert on the subject and can result in them sending more readers to your site.

4E Marketing Strategy: Redefining Customer Connections

As the digital world transforms at breakneck speed, businesses need more than traditional strategies to keep up. Enter the 4E Marketing Strategy—a modern framework designed to forge deeper, more authentic connections with customers. Unlike the outdated focus on products or pricing, the 4Es—Experience, Emotion, Engagement, and Exclusivity—revolve around understanding human behavior and creating moments that truly resonate. Here’s how this game-changing approach can elevate your e-commerce strategy:

• Experience
• Emotion
• Engagement
• Exclusivity

Experience: Crafting Unforgettable Moments

Experience is the cornerstone of the 4E framework, transforming how brands interact with their audiences. It’s not just about usability; it’s about designing journeys that captivate at every touchpoint. From seamless mobile shopping interfaces to virtual reality showcases and real-time support, e-commerce businesses must aim to delight. Tools like A/B testing or heat maps can help refine these touchpoints to keep customers coming back, eager for more​​.

Emotion: Striking the Right Chord

Emotion drives decision-making—it’s what makes a brand memorable in the vast sea of competitors. By weaving compelling stories and real customer success moments into their messaging, brands can tap into desires and aspirations that linger long after the sale. The goal is to make customers feel something—awe, joy, trust. When people believe in a brand’s mission and values, it sparks loyalty that outlasts trends​.

Engagement: Building Dynamic Connections

Engagement is no longer optional; it’s a necessity. Brands that listen, interact, and adapt to their audience stand out. It’s not just about social media likes or shares—it’s about creating opportunities for genuine interaction, like hosting live Q&A sessions, encouraging user-generated content, or gamifying customer experiences. These moments don’t just drive awareness—they create bonds​​.

Exclusivity: Offering Something Truly Special

Everyone wants to feel special, and exclusivity is how brands deliver that feeling. Offering early access to products, limited-edition releases, or personalized recommendations makes customers feel valued and part of an elite group. It’s about creating an environment where loyalty isn’t just rewarded—it’s celebrated. This sense of belonging can turn casual shoppers into lifelong brand advocates​.

Unlocking the 4E Advantage

By adopting the 4E Marketing Strategy, businesses don’t just survive—they thrive. These principles align seamlessly with customer expectations, tackling common e-commerce challenges like low conversion rates or fierce competition. With Experience, Emotion, Engagement, and Exclusivity guiding your strategy, you’re not just selling—you’re building lasting relationships in a world where connections are currency.

In conclusion, use tools to support your analytics

E-commerce marketers and retailers experience a mix of unique challenges and tremendous opportunities. The list of possible tools to build your marketing stack seems, at times, endless. Seizing the opportunities at your fingertips, however, requires that they consistently reach their target audience at the right time, on the right channel, and using the right message.

Fortunately, there are some powerful digital marketing tools that provide scalable and cost-effective solutions to significantly grow your business. (And we didn't even touch on data storage, which we've previously written about as a critical component long-term analytics plans.)

Yet no digital marketing strategy can be successful without access to and the ability to analyze quality data. Customer data integration tools allow companies to centralize data collection and route it to various third-party sources (marketing tools, data storage, etc.).

Finding one intuitive and easy-to-use platform that integrates with all your preferred tools gives e-commerce marketers access to incredibly powerful insights.