With the meteoric growth seen in e-commerce over the last decade, it is no surprise that the budding digital retail stores have a disadvantage when compared to the already established e-commerce platforms. The e-commerce market is an enormous place where the maximum sales are made by the ones who stay one step ahead of others.
With high customer expectations combined with the ever-evolving technological and economical trends, the e-commerce industry is an intimidating place for startups. One can only carve out a niche for themselves in this dynamic space if they make smart choices and stay informed.
In 2020, it was seen that most of the online retail stores had only 2-3% conversion rates. Similarly, there are numerous challenges faced by the newcomers in the field, which are listed in this article with suggestions to overcome them.
Lack Of Online Search Visibility
Setting up an online storefront is only a small step in the journey to becoming a successful online business. Creating online search visibility is the next major step to take in order to build engagement and boost sales. Creating traffic alone does not increase the sales a website produces, but only if a significant number of visitors land on the page can they be converted into buyers.
Moreover, the ranking and visibility of the online retail store creates an image and awareness about the brand. With the large and well-established companies like Pinduoduo taking up the highest rankings on search engines, the smaller and newer businesses have to stay on top of their game to attract customers.
To promote a business online, the best way is investing in Search Engine Optimization tools. Interacting and engaging with the target population on social media is also highly effective since most people look for information and reviews on these social media platforms before purchasing.
Managing Shipping, Delivery and Returns
After setting up a storefront that receives significant traffic, the next challenge faced by entrepreneurs is creating a smooth flow of on-time delivery, shipping, storage, and handling returns. With the booming expectations of customers in the hands of the dealers, startups find it hard to have seamless order fulfillment and customer satisfaction.
A significant number of buyers look at the shop’s refund and return policies before making a purchase and 48% of the customers return to stores with less complicated policies. Hence, in order to build a brand image and increase loyalty to customers, the startups have to efficiently manage their delivery, shipping, and refunds.
In the initial stages, it is advised that the entrepreneur invests in a local delivery service that is reliable. As the sales increase, these local services may not suffice; in conditions like this, look for cheaper large-scale delivery services or at what the competitors are doing and try to personalize those methods. Always keep in mind that timely delivery and simple return policies help maintain customer relations.
Marketing And Advertising Fees
With growing competition, the need for effective advertising and marketing keeps increasing. Most newly established online retail stores focus their investments on setting up an attractive website.
While that is a crucial aspect, without proper outreach, the rate of sales generated will be poor. Hence, instead of investing most of the capital in web development, startups should pool their funds into devising a foolproof marketing strategy. Some of the simplest ways to assure effective brand marketing are by using social media platforms and SEO keyword optimization.
Using these methods, the brands are able to appeal to the target audience. They increase the visibility and search engine ranking of the webpage which ensures that the majority of the target audience will click on the page. Striving to increase traffic on the retail platform and in relation, increasing the conversion rates and sales, is an easily affordable marketing strategy for up and coming online stores.
Shopping Cart Abandonment
One of the biggest challenges faced by e-commerce businesses, both big and small, is shopping cart abandonment. The reasons behind this are many, starting from a long checkout process to a lack of different payment channels.
Shopping cart abandonment is especially painful for smaller businesses as they create lower conversion rates and affect the company’s turnover. Cart abandonment may also occur as a result of technical errors or unsatisfactory user experiences.
There are many ways to combat cart abandonment and the foremost one is to ensure that the webpage is optimized for mobile devices. Enquiring about the customer’s needs through a live chat and making the checkout process simple are other solutions to cart abandonment.
Everyone wants to make a quick buck via e-commerce and the increasing number of online retail establishments will surely affect the sales of smaller stores. Since the internet is a platform providing equal footing to all the businesses regardless of their size, the startups with innovative business strategies get more profits.
In order to do so, e-commerce startups have to stay in touch with the trends in the market. Over hundreds of establishments share the same target audience in the e-commerce industry, even then the most appealing online stores are going to be the ones with benefits like free shipping, quality customer service, and easy seasonal offers.
Also, distinguishing one’s products and services from the competitors using research, design, or marketing techniques help the smaller startups from losing customers to competitors. As homegrown startups try to keep pace with the establishments like Amazon, more traffic and sales are made by stores that adapt to the customer’s needs.
In this highly competitive industry, success is determined by a brand’s ability to adapt itself to cater to the customers’ needs. Also, implementing the latest technological advances to promote the brand helps in eliminating a lot of challenges that online retailers face. In addition, earning customer loyalty and building a recognizable brand image are goals that new e-commerce businesses aim to achieve.
However, the ability to overcome these challenges will only make the online business platform more optimized for the highly demanding industry. Facing these challenges will give smaller startups a readiness to adapt their services to meet the customers’ expectations and display their competency.