Ask Nik: How Do I Create the Perfect First Purchase Experience?

Ask Nik is an advice column by Nik Sharma on all-things entrepreneurship. In this column, Nik discusses tips and tricks to optimize your online store for first impressions and repeat customers.

Welcome to Ask Nik, an advice column by me, Nik Sharma, on all-things entrepreneurship. I’ve spent the majority of my career focused on launching, scaling, and operating direct-to-consumer ecommerce brands like Hint, JuneShine, Caraway, Black Wolf Nation, Spritz Society, and Poo~Pourri. Today, I run Sharma Brands, a consulting firm and growth partner to some of the most admired startup brands as well as the largest CPG companies that we all know, love, and use daily. 

Got a burning entrepreneurship question you’d like me to answer? Tweet me!

Dear Nik,

I’ve been working on my brand for a few months and I’ve been busy perfecting my store to make it ready for first-time customers. What’s the best way to set up my store for the perfect first impression? I want to entice as many new buyers to try my products because I know that’s the key first step in having them coming back!

Signed,
All-About-First-Impressions

If you've recently launched a new business and have already started talking with your customers, you know how important it is to merchandise and present your store the right way.

There was an episode in The Office where Dunder Mifflin hosted a public garage sale. In that garage sale, Dwight, beet farmer and office tryhard, was extremely focused on the way he set up his table. He made sure that the fuller, better looking beets stayed at the front of the table, while the ones that weren't as lush were placed toward the back.

Looking back on it now, I realize he was merchandising his products in a way that made it more likely he'd land the sale. By definition, merchandising is, "the activity of promoting the sale of goods, especially by their presentation in retail outlets." When you walk into a retail store, different aisles are merchandised to promote what will create the best shopping experience. You might find the brands most often purchased to be around eye-level, and those that aren't are usually a few shelves up or down.

Similarly, in ecommerce, while you want to beautifully present your site and its product offerings, ensuring you put the right products on different pages of the website, you also want to focus on one more thing: your new customer acquisition offer.

The new customer acquisition offer is typically pushed out in the form of a bundle or a grouping of products. You want it to be the best possible introduction to your brand. Think of it similar to when you go to a restaurant for the first time, and the waiter recommends what you might enjoy best—they're creating a curated experience that increases the probability that you'll like the product they bring you.

With your new customer acquisition offer/bundle, you want to ensure it checks a few boxes:

• Put your brand’s best foot forward! Include products that have the highest probability of customer satisfaction.
• If it's a consumable product, ensure there is enough for a full household to sample the product.
• If you have different product variants (colors, sizes, flavors, scents, etc), put your top 2-3 in there, so someone can find their favorite.
• Aim for an average order value (AOV) of 1.5x your normal AOV. While it might seem strange, by adding a discount, it works.
• Add a discount to encourage people to trial the product, at least the first time. You're balancing the discount with a higher AOV.

When we worked with Poo~Pourri, we created a Best Smellers bundle (get it? 😉) which checked all those boxes. The product has a great retention and repeat purchase rate, so we knew that even with a discount, we would make up for the discounted revenue in the second purchase. You'll even notice the real estate underneath the bundle is heavily focused on educating a new customer on what the product is, why it's worth buying, and how it'll add value to their life.

The Poo~Pourri, we created a Best Smellers bundle, merchandised with 3 top sellers and a discount.

At Hint Water, we created a "3 cases for $36" offer, where we sold 3 cases of water (36 bottles) for $36, or $1 each. In this example, we allowed the customer to choose up to 3 different flavors, and 3 cases of water was the perfect amount for a household to properly sample each flavor and choose their favorite. We found the second purchase, following the custom bundle, would narrow in on 1-2 flavors, and then customers would subscribe.

The Hint Water “3 cases for $36” bundle, offers the perfect amount for a household to properly sample each flavor at a discount.

Having the right acquisition offer can not only help properly welcome customers to your brand, but it ensures that you give yourself the best possible chance for a customer to return. For a new customer's first purchase, the right variety also gives them the confidence to come back and shop from your store again.

Good luck, and here’s to repeat, happy customers 🚀