Ecommerce Marketing Strategy: Stop Optimising the Wrong Things

An ecommerce marketing strategy is a structured plan for acquiring customers, converting them, and retaining them profitably across every channel that touches your business. The best ones are built around margin and lifetime value, not traffic and conversion rate in isolation. Most brands get the tactics right and the strategy wrong.

The gap between a brand doing ecommerce marketing and a brand doing it well is almost always a measurement and prioritisation problem, not a creative or channel problem. Fix what you measure first, and the rest gets easier.

Why Most Ecommerce Marketing Strategies Fail Before They Start

I spent several years managing large performance marketing budgets across ecommerce clients, and the pattern I saw repeatedly was brands building strategy backwards. They would start with the channel, usually paid search or paid social, set a ROAS target, and call that a strategy. It is not. ROAS is a metric. Strategy is the thinking that sits behind which metrics you choose to optimise, and why.

The most dangerous version of this mistake is when a brand is hitting its ROAS target and losing money. I have seen it more than once. The blended ROAS looks healthy, the agency is celebrating, and the CFO is quietly confused about why the P&L does not reflect the marketing numbers. The reason is almost always that ROAS ignores cost of goods, returns, fulfilment, and the fact that not all revenue is created equal. A £50 order on a product with 20% margin is not the same as a £50 order on a product with 60% margin. Treating them identically in your optimisation logic is a structural problem.

Strategy starts with a clear answer to a simple question: what does a good customer actually look like for this business? Not a good order. A good customer. Once you can answer that, you can build a funnel and a channel mix that goes after more of them.

How the Funnel Maps to Ecommerce Reality

The traditional marketing funnel model still holds up in ecommerce, but it needs to be interpreted commercially rather than academically. Awareness, consideration, and conversion are real stages, but in ecommerce the post-purchase phase is where the actual business model lives. HubSpot’s breakdown of funnel stages is a useful reference point for defining what each stage should accomplish, even if you will need to adapt it for your specific category.

For ecommerce specifically, I think of the funnel in four stages rather than three: acquisition, first conversion, repeat purchase, and advocacy. Most brands invest heavily in the first two and almost nothing in the last two, which is precisely backwards if your goal is sustainable profitability.

If you want to go deeper on how funnels should be structured to drive commercial outcomes rather than just traffic, the high-converting funnels hub on The Marketing Juice covers the full picture, from funnel architecture to the specific tactics that move people through each stage.

The TOFU, MOFU, BOFU framework from Semrush is a clean way to think about content and channel allocation across the funnel. Top of funnel is about building a pool of future buyers. Middle of funnel is about accelerating intent. Bottom of funnel is about removing friction. Each requires different creative, different channels, and different success metrics. Treating them all the same way is one of the most common structural errors in ecommerce marketing.

Paid Acquisition: What It Can and Cannot Do

Early in my career, I ran a paid search campaign for a music festival at lastminute.com. It was a relatively simple campaign by today’s standards, but within roughly a day it had generated six figures of revenue. That experience shaped how I think about paid media: when demand already exists and you put the right message in front of the right person at the right moment, it converts. Paid search at its best is demand capture, not demand creation.

That distinction matters enormously for ecommerce strategy. If your category has high search volume and clear purchase intent, paid search should be a core channel. If you are selling something new, something niche, or something that people do not know they need yet, paid search will disappoint you because the demand is not there to capture. You need to create it first, which means upper-funnel investment in content, social, and brand.

Paid social sits in a different position. Meta and TikTok are primarily interruption channels. You are showing up in someone’s feed uninvited, which means the creative has to do a lot of heavy lifting. The brands that do this well are not the ones with the biggest budgets. They are the ones that understand their audience well enough to make content that does not feel like an ad. That sounds obvious. It is surprisingly rare in practice.

The practical implication for budget allocation is this: do not treat paid acquisition as a single line item. Break it into demand creation and demand capture, and make a deliberate decision about how much of each you need given your category maturity and brand awareness levels. A brand with strong organic search presence and high category awareness should weight heavily towards capture. A brand launching into a new category needs to invest in creation first or the capture channels will never have enough to work with.

SEO and Content: The Compounding Asset Most Brands Underinvest In

When I was in my first marketing role around 2000, I asked the MD for budget to build a new website. The answer was no. So I taught myself to code and built it anyway. That experience gave me a perspective on owned assets that has stayed with me: when you build something yourself, you understand its value differently than when you buy it. Organic search is the same. It takes time and effort to build, but once it is working it compounds in a way that paid media never does.

For ecommerce brands, SEO is often treated as an afterthought behind paid acquisition. That is a mistake, particularly as paid media costs continue to rise. A well-structured content programme that targets category-level search terms at the top of the funnel and product-level terms at the bottom can reduce your dependence on paid channels significantly over a 12 to 24 month horizon.

The content formats that tend to be underused in ecommerce are the ones closest to purchase intent. Moz’s analysis of overlooked bottom-of-funnel content formats is worth reading if you want to understand where the organic opportunity is being left on the table. Comparison pages, best-in-category roundups, and detailed product guides all have strong commercial intent and are far less competitive than broad category terms.

Video content is also underused in the ecommerce funnel, particularly in the consideration phase. Wistia’s guide to using video across the sales funnel outlines where different video formats earn their place, from awareness-stage brand content through to product demonstrations and post-purchase onboarding. The brands that use video well at the consideration stage tend to see lower return rates as well as higher conversion, because customers arrive with more accurate expectations.

Email and SMS: The Retention Channels That Pay for Everything Else

Email is the highest-margin channel in most ecommerce businesses. It costs almost nothing to send, the audience is warm, and the conversion rates are materially higher than cold traffic. The brands that treat email as a broadcast tool, sending the same promotional message to their entire list every week, are leaving most of that value on the table.

The structural shift that changes email from a cost centre to a genuine revenue engine is segmentation and automation. Behavioural triggers, browse abandonment, cart abandonment, post-purchase sequences, and win-back campaigns all perform at a different level than broadcast emails because they are contextually relevant. Someone who just bought from you for the first time has a completely different set of needs and questions than someone who has not purchased in nine months.

SMS is growing as a complement to email rather than a replacement. Mailchimp’s overview of SMS for lead generation covers the basics of building an SMS list with proper consent, which matters both legally and for engagement quality. SMS works best for time-sensitive messages: flash sales, restock alerts, shipping updates. It is not a channel for long-form content or relationship building. Use it for what it is good at and resist the temptation to treat it like a cheaper version of email.

AI is starting to change how ecommerce brands approach both channels. AI-assisted approaches to lead generation are becoming more practical for brands without large data science teams, particularly for personalisation at scale and send-time optimisation. The caveat is that AI tools are only as good as the data they are trained on. If your customer data is messy or incomplete, AI personalisation will amplify that problem rather than solve it.

Customer Retention: Where Ecommerce Profitability Is Actually Built

I have worked with ecommerce businesses that were growing revenue at 30% year on year and still struggling to make money. In almost every case, the root cause was the same: customer acquisition cost was rising, repeat purchase rate was low, and the business was essentially running a treadmill. Every month required more new customers just to maintain revenue, because existing customers were not coming back.

A second purchase changes the economics of a customer entirely. The acquisition cost is already sunk. The second transaction is almost pure margin contribution. If you can move your repeat purchase rate from 20% to 35%, the impact on your overall business profitability is significant, without spending an extra pound on acquisition.

The levers for improving retention are not complicated, but they require discipline. Post-purchase communication matters. If someone buys from you and the next thing they hear from you is a promotional email three weeks later, you have missed an opportunity to build a relationship. A proper post-purchase sequence, covering order confirmation, shipping updates, product education, and a follow-up asking for feedback, costs almost nothing to set up and materially improves both satisfaction and repeat purchase likelihood.

Loyalty programmes are often overcomplicated. The brands that do them well tend to keep the mechanic simple: spend more, get more. The brands that do them badly create something so complex that customers cannot understand the value, which means the programme has no effect on behaviour. If you cannot explain your loyalty programme in one sentence, it probably needs simplifying.

Measurement: The Honest Version

Having judged the Effie Awards, I have seen how the industry thinks about marketing effectiveness at its most rigorous. The gap between that level of analytical discipline and what most ecommerce brands actually do with their data is significant. Most brands are measuring activity, not outcomes. Impressions, clicks, sessions, and conversion rates are all activity metrics. Contribution margin, customer lifetime value, payback period, and repeat purchase rate are outcome metrics. You need both, but the outcome metrics should be driving your decisions.

Attribution is the area where the most confusion lives. Every attribution model is a simplification of reality. Last-click attribution over-credits the channel that closed the sale and under-credits everything that built awareness and intent. Multi-touch attribution is more accurate but still relies on tracking that is increasingly broken by iOS changes, cookie deprecation, and cross-device behaviour. Data-driven attribution is better still, but requires volume to be statistically meaningful.

My practical recommendation is to use attribution data as a directional signal rather than a precise measurement. If paid social looks weak on a last-click basis but strong on an assisted basis, that tells you something useful about its role in the funnel. Combine that with incrementality testing, where you measure what happens to sales in regions or segments where you switch a channel off, and you get a much more honest picture of what is actually driving your business.

The brands that make the best decisions are not the ones with the most sophisticated attribution models. They are the ones that are honest about what they know and what they do not know, and make decisions accordingly. False precision is more dangerous than acknowledged uncertainty.

Channel Mix: How to Decide What to Prioritise

There is no universal answer to which channels an ecommerce brand should invest in. The right answer depends on your category, your margin structure, your average order value, your customer acquisition cost, and your current brand awareness levels. Anyone who tells you otherwise is selling you a framework, not a strategy.

What I can offer is a decision-making structure. Start with your customer economics. What is your average order value? What is your gross margin? What is the maximum you can spend to acquire a customer and still make money on the first order, and across the lifetime of the relationship? Once you know those numbers, you can work backwards to understand which channels are viable at what cost per acquisition.

From there, match channels to funnel stages. Paid search and shopping ads are bottom-of-funnel demand capture. Content marketing and SEO are top-of-funnel demand creation that compounds over time. Paid social sits across multiple stages depending on creative and targeting. Email and SMS are retention and re-engagement channels. Influencer and affiliate marketing can work at multiple stages depending on how they are structured.

The mistake most brands make is adding channels without a clear hypothesis about what role each one plays and how they will measure success. Diversification without clarity is just spreading your budget thinner. Add a channel when you have a clear reason to believe it will reach an audience or serve a funnel stage that your existing mix is not covering well.

Conversion Rate Optimisation: The Right Frame

CRO is one of the most misunderstood disciplines in ecommerce marketing. The popular version is that you run A/B tests on button colours and checkout flows until your conversion rate goes up. That is not wrong, but it is a very narrow version of what CRO should be.

The broader version is: what are the reasons people who want to buy from us are not buying from us? The answers might be in the checkout flow. They might also be in the product page, the returns policy, the shipping cost, the lack of social proof, the payment options, or the fact that the mobile experience is slow. A proper CRO programme starts with qualitative research, heatmaps, session recordings, and customer surveys, before it starts with A/B tests. The test should validate a hypothesis, not go fishing for one.

The other thing worth saying about CRO is that conversion rate is not the only lever. Average order value and margin mix matter just as much. A test that increases conversion rate by 5% but reduces average order value by 10% has made your business worse, not better. Always look at revenue per session or contribution margin per session as your primary metric, not conversion rate in isolation.

If you are thinking about how CRO fits into your broader funnel architecture, there is more on this in the high-converting funnels hub, where the relationship between funnel stage and optimisation approach is covered in more depth.

Putting It Together: What a Functioning Ecommerce Strategy Actually Looks Like

A functioning ecommerce marketing strategy has a small number of clearly defined components. It knows who it is trying to reach and what a good customer looks like in commercial terms. It has a channel mix that is matched to funnel stages and justified by customer economics. It has a retention programme that is as well-resourced as its acquisition programme. It measures outcomes, not just activity. And it has a process for testing, learning, and adjusting based on what the data actually says rather than what the team hoped it would say.

That last point is harder than it sounds. I have sat in enough marketing reviews to know that the instinct when results are disappointing is to find a reason why the data is wrong rather than a reason why the strategy needs to change. The brands that grow consistently are the ones that have built a culture of honest evaluation. They celebrate good results and learn from bad ones without needing to protect anyone’s ego in the process.

The practical starting point if you are reviewing your strategy now is to audit your current channel mix against your customer economics. Are you spending money in places where the cost of acquisition is structurally higher than the lifetime value of the customers you are acquiring? If so, that is the first thing to fix. Everything else is refinement.

About the Author

Keith Lacy is a marketing strategist and former agency CEO with 20+ years of experience across agency leadership, performance marketing, and commercial strategy. He writes The Marketing Juice to cut through the noise and share what works.

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