7 Common Ecommerce Business Challenges Solved

Ecommerce business comes with its own share of challenges and risks. Being aware of these challenges keep ecommerce entrepreneurs ahead of the curve in business.

Gaining Trust Is Filling A Piggy Bank

Exhibiting trust is a much more important factor in online as compared to offline. Thanks to the numerous stories of online fraud we have heard over 2 decades. If your store is relatively new to your audience it might be difficult for them to trust your brand. You might have the most trustworthy design, service and brand messaging trust are only gained when you show up over a period of years repeatedly. Building trust takes time and it can be earned by doing basics right.

Solution

  1. Free Returns – This will remove the fear of bad purchases from the mind of the consumer. Free returns show that you are ready to take responsibility for customer indecisions.
  2. Paste Testimonials throughout the website – A customer needs confidence that people who have bought from the website are happy with their purchase.
  3. Clean Minimalist Design – A website which portrays trust is easy to build. Making a website clean and usable gives the user a good initial perception of the brand.
  4. Show the real people behind the business – Use your about, contact and careers page to show the people behind your business.
  5. Be clear about your refund policy and shipping up front – The user might have fears regarding delivery, payment, and fraud. How well you fight these fears decide how best you convert a visitor into a customer.

Recommended Read: How to design your online store for trust

Acquiring Organic Traffic Takes Time

Search is still the dominant marketing channel for most online stores. Driving search engine traffic to your online store takes anywhere between 6 months to 1 year. You have to put in an effort to have technical SEO in place and have relevant high-quality content on your site. Search engines tend to trust sites which have a reputation in the social and editorial sphere. For a new online store, this might be difficult as getting in the news and being talked about in various forums happens with great work over many years.

Solution

  1. Think SEO from day 1. Choose an ecommerce platform which is SEO friendly. Optimize your product pages as they are uploaded and make sure the hygiene of your site is maintained.
  2. Think a combination of SEO and Adwords. Search traffic has the highest conversion rates. You must be good in these 2 marketing channels for good long-term success.

Getting The Word out Is Hustle

When you are new in the business and on a tight budget getting the word out is work of hustle. This might make you frustrated because your marketing strategy might not scale as fast as you expect to. Struggling through this dip is a key part of entrepreneurship.

Solution

Try multi-channel sales. Don’t focus on selling your products only on your website. Leverage huge audience on sites like eBay and Amazon to get those initial cash flow rolling. By using Amazon FBA you can even let Amazon handle your inventory. The advantage of this approach is you pay them only for a sale and need not invest any amount in marketing the product yourself.

Expect Unforeseen Losses

Ecommerce is about getting multiple things right at once. Successfully executing one order is about acquiring a visitor, converting the visitor into a customer and fulfilling his or her order. In this whole circus, there are many things which could potentially go wrong. All unforeseen losses are not within a business owners hand and should be accounted for in your budget planning.

  1. Return Logistics – A customer might find the product she purchased doesn’t fit right. You need to have your fulfillment provider ship the product back to your warehouse. This is an unforeseen loss which you might have to bear.
  2. Damage and theft – During transit the product can be damaged or stolen. To prevent such scenarios you have to have documented insurance terms with your fulfillment provider. Read: How to pick an ecommerce logistics company?
  3. Damaged Goods – Few goods might be damaged in your warehouse. You have to bear these losses. One way of avoiding is by announcing a sale on perishing goods or sticking to drop shipping wherein the quality of the product is entirely the Dropshipper’s responsibility.
  4. SEO is unpredictable – Google ranking factors are forever changing. With machine learning, a huge part of the ranking algorithm SEO has become a black box for internet marketers.
  5. Website Downtime – No website can have 100% uptime. Whether you are using a hosted solution or an owning your own servers there are chances that your site could be down for few hours because of server outages and technical glitches. This downtime can affect your revenue and lose few customers.
  6. Payment failure – Payment gateways come with their share of failures. No payment gateway can guarantee 100% success rate. Also, sometimes the user lacks patience and quits the transaction abruptly.
  7. Dropshipper failure – Using a dropshipper to sell items might seem exciting. When a dropshipper ships the wrong product or claims the product out of stock it is your business which loses its reputation. At the end of the day when customer’s order from your online store they expect you to give great customer service. With dropshipping, you lose control over speed and accuracy at which you ship the product.

Risk Of Online Fraud And Theft

More than 30,000 websites get hacked each day. Customers expect an ecommerce store to be highly secure. All online sites immaterial of the size of the business is prone to attacks from hackers. As an ecommerce entrepreneur, it is your responsibility to keep your customer data secure and your site safe for browsing. When search engines and browsers find that a particular website is not safe for the viewer they inform with a warning sign. Such a warning sign could tarnish your site reputation as a safe website.

Solution

  1. Use an ecommerce platform which is secure – Hosted ecommerce solutions like Shopify and Bigcommerce are secure. If you are using self-hosted ecommerce solution then making your site safe for browsing and transactions is your responsibility.
  2. Use Safety SSL certificates – This will ensure the safe data transference between the client and the server. Your customer data is stored safely on your servers without the possibility of theft or fraud.
  3. Use your T&C section wisely – No website is 100% secure and the user has to understand that anywhere their credit card is being submitted there is always an element of risk. This has to be mentioned in your Terms and Conditions section clearly.

You Will Lose On Pricing

The ecommerce game is cutthroat. Large online retailers get deep discounts from wholesalers which helps them be competitive in pricing as compared to other smaller online players. There are many price comparison engines which display prices from various sites. Users check the prices of the product across multiple websites and stick to the cheapest one if all other variables remain same. Competing on pricing is a race to the bottom and is a luxury which only a few online vendors can afford.

Solution

  1. Compete on other value-added features like shipping, free returns, free refund a delivery option.
  2. Sell unique products and designs which no one else is selling.
  3. Give lifetime online support.

Buyer Retention Is A Challenge

Customer loyalty is an uphill task. With deep discounts and the next cool product just a click away building customer loyalty has become a big challenge in the ecommerce space. With cost of user acquisition going up by the year it is clearly evident that for retaining customers you have acquired over long durations is pivotal for ecommerce business success. Companies like Amazon and Zappos thrive on the fact that 2/3rd of its purchases are because of repeat customers. Building same level loyalty is difficult for a small business online store.

Solution

  1. Loyalty programs – Loyalty programs give users to come back to you for deeper discounts. Loyalty programs are long standing marketer’s friend and still works for many major players like Macys and FreePeople.
  2. Provide un matched customer service

After working 7+ years as a digital marketer for startups and large enterprises I quit my job to start EcommerceYogi. Here I share the exact same tactics which I have used to drive millions of users per month to e-commerce stores. Follow me on Linkedin and Twitter to stay connected.