In an incredibly competitive e-commerce market, many online businesses selling online place tunnel-focus on sales revenue, while overlooking an aspect just as important: reducing costs.

Here are three easy and often over-looked routes to reduce costs for your online business.

1) Focus on Existing Customers

It is often much more expensive trying to gain new customers than retaining the customers you already have. To retain current customers, focus on things like:

  • Stellar Customer Service -- If your existing customers trust your business and believe that you possess their best interest at heart, they will be exponentially more likely to keep doing business with you.

  • Offering Deals and Discounts -- Offering discounts to existing customers is very powerful. Many times, consumers feel neglected when they notice all the new customer deals, while they are expected to pay more for the same product/service. In fact, offering new customer deals and little-to-no existing customer deals may encourage customers to shop elsewhere, where they can receive new customer discounts themselves.

  • Taking Complaints Very Seriously -- About 95% of ALL dissatisfied customers do not complain. When you do receive a complaint or a problem, treat it like a gift and make sure that problem is not reciprocated, because they may be just one in 20+ people that have had the same problem.

It is roughly seven times more expensive to acquire a new customer than it is to keep an existing customer. Furthermore, existing customers are five times more likely to purchase a product than a new prospect. You can see how a focus on customer retention can save huge amounts for your business.

2) Payment Options & Transaction Costs

Many payment outlets have fees that will soar as your order volume grows. You may be charged monthly fees, set-up fees, and even transaction fees on each unit sold!

To solve problems associated with these fees, you will need to understand your business and customers. If you mainly target domestic customers, consider using offline payment techniques, such as cash/ATM deposits, echecks, or online bank transfers.

Make sure that you are using the most popular payment gateways like PayPal if your company hasn't taken off quite yet.

If you are already well-into your thriving business and don't know if you can afford to cut any payment outlets, keep this in mind: Your payment outlets don't want to lose you as their customer, either. Call that provider and try to negotiate your transaction costs.

Minimizing the amount of fees you pay now can make a big impact for your business in the future.

3) Optimize Your Shipping

Every online business knows that one true, revenue-killer is shipping costs. Customers love seeing low or free shipping costs on their purchase, but on your end, it can feel like a dagger to spend so much on getting your product to their doorstep.

Other than analyzing your packaging and seeing what you can do to cut costs on your customer's "unboxing experience," an easy way to save money on shipping is using a multi-carrier shipping software.

Most shipping platforms will promise you lower shipping rates, so ensure that you are using a shipping platform that fits you. Check for the following criteria:

  • Marketplace Integration & CSV Mapping -- If it doesn't integrate to your marketplace, you will waste time and effort.

  • Multiple Carriers -- Make sure that it integrates multiple carriers AND will compare shipping solutions across each, confirming that you're spending the least amount possible.

  • Discounted Shipping Rates -- While all may advertise the lowest USPS shipping rates, truth is, they are all the same. However, nearly EVERY shipping platform relies on a third-party contract to provide these rates. Several lawsuits and contract disputes in these environments have brought instability to users of these platforms. So, locate a shipping software company that owns its own rates directly with the USPS.

  • Live Expert Support & Reporting -- To be bold, most of the largest shipping platforms don't offer a sophisticated-level of customer---or expert---shipping support. They are tech gurus but not shipping experts. Find a shipping platform that is committed to advising you on best-in-class shipping optimization strategies.


With so many silent killers in the "costs" column of your online business, focusing on existing customers, lowering your transaction costs and optimizing your shipping will save your business large sums in the long-run. Don't wait to streamline your business. Start right now.