“The first steps are the most difficult,” you’ve probably heard. However, this is not the case with ecommerce businesses. Starting an online store is now relatively simple, thanks to a plethora of off-the-shelf ecommerce store setup software and low-cost ecommerce website design companies. You can even get started selling your products within a few days.
But the most challenging part is turning your ecommerce startup into a profitable and successful business. According to recent industry reports, eight out of ten ecommerce stores fail within the first 24 months of operation. Other studies put the figure even higher, claiming that 97% of all ecommerce businesses fail to make a profit. That’s a considerable number.
So, what’s the issue? Why do so many ecommerce businesses fail, even when they have a dedicated founder or team behind them? This post delves into the top reasons why ecommerce businesses fail and how to address the most common causes of failure.
Poor Product Images and Content Description
You’ve created a fantastic product and spent a significant amount of time designing it or sourcing it from the best vendors. You are done with research and determined that the product is in high demand.
However, your product listing on your website consists of a few grainy photos and poorly written copy. If your product listing looks like something you’d find on eBay, it’s time to make some changes. Poor-quality product images and content not only deter sales but can also leave a negative impression on your product and devalue your brand.
What’s the best way to work with it?
If you’re interested in product photography, start by investing in the right equipment and learning a few tips and tricks for taking photos in the best light possible. Multiple views of your product should be included, as well as detailed descriptions. Instead of using generic descriptions, describe your product from the customer’s perspective – what they would like to know about it, and so on. If photography isn’t your thing, you can hire professional photographers or hire a Shopify web development company to help you set up your product listing and the rest of your ecommerce store.
Don’t rely on price alone to attract customers. Instead, entice them by emphasizing your product’s best features. Showcase your products to their full potential.
Missing Business Contact Information
Failing to display your complete contact information prominently on your website or burying it deep in the site’s corner causes customers to lose trust in you. When a new customer visits your site, they will be looking for information about your company, such as where you are based, your brand’s story, etc. Customers prefer brands that are easy to reach because they can get in touch with you quickly if something goes wrong.
What’s the best way to work with it?
To gain the trust of your potential customers, make sure to include all of your contact information, including your email address, phone numbers, address, and social media pages.
Financial Mismanagement
Any business that does not track and monitor its finances will quickly die. Let’s take an example to explain this point. Ecomom was one of the first ecommerce businesses to launch in 2007. Natural and environment-friendly products from expecting and new moms and natural baby food, toys, and clothing were all part of the company’s product line.
The concept was sound, and the company had a growing customer base as the demand for natural and chemical-free baby products grew. But, just six years after its founding, the company went bankrupt in 2013.
So, where did things go wrong?
Ecomom’s founder, Jody Sherman, secured a massive $1 million in funding for his online business. The biggest issue was that Jody was an entrepreneur rather than an accountant. For his startup, he failed to hire the right financial team. While revenues appeared to be increasing, the company was losing money due to a lack of investment returns. Jody committed suicide in 2013 due to his losses, and the company went out of business.
The lesson is clear not to scare you, but you need the right accounting or financial team to stay on track. If you can not afford to hire a professional accountant, devote some time to learning the fundamentals of business accounting.
Complicated Checkout
When it comes to shopping online, no one wants to do more than the bare minimum. When Amazon ditched the complicated checkout of the previous decade favoring single-click purchases, it revolutionized online shopping.
If your checkout process is complicated and multi-step, it’s time to update the design. Engage the services of a Shopify web developer to assist you in refining and redesigning the checkout process. Customers should not be required to register or sign in to their account before proceeding with the process. Instead, give customers the option of signing in before completing the transaction. Allow them to check out as a guest if they don’t want to create another registration account.
A Lackluster Website
You can’t expect to be successful if your website isn’t performing well, regardless of your business model or the products you sell. Your website serves as the front door to your online store. Your website is the cornerstone of your entire ecommerce business, regardless of the other channels you use to sell your products, and it needs to reflect that.
When creating a website, make sure it’s functional, responsive, and up-to-date and provides the best user experience possible. Not only does an easy-to-use website increase conversion rates, but it also ranks higher on Google. Look for layouts that are simple and clutter-free.
To get your online store optimized for all mobile devices, hire a competent Shopify plus development company. If necessary, you can also invest in a mobile shopping app in addition to a mobile website. However, you must also provide a positive app experience for your customers. As a result, make sure it’s thoroughly tested and not an afterthought.
Hidden Fees
This is a significant disadvantage. Hidden fees are one of the most common causes of cart abandonment. When customers are presented with an additional cost at the end of the transaction, such as shipping fees, 61% of customers abandon their cart. To avoid this, make sure to inform your customers about the shipping costs upfront. You can also use it to your advantage by informing customers that they will not have to pay for shipping if they spend a certain amount.
Customers can also use a shipping cost calculator to estimate how much they will have to pay ahead of time.
Poor Online Marketing
Let’s pretend you open a café in a secluded part of town and don’t advertise it. You will not have any customers except for a few walk-ins. The same is true for online shops.
You may have the best products on the market, excellent customer service, and a seamless web store, but you won’t be able to meet your sales goals unless you use targeted marketing. This is where the role of marketing comes into play.
Create a solid online marketing strategy first. Determine your objectives and then work toward achieving them.
Final Thoughts
There’s no denying that ecommerce is a cost-effective way to get your business off the ground. It does, however, necessitate effort, planning, and hard work. Make sure to avoid the ecommerce blunders listed above if you want to succeed. Instead of focusing on short-term goals, prioritize long-term sustainability and growth. Do your homework and create an outstanding online business that will continue to attract customers and generate sales over time.
