E Commerce Marketplace blog

Category: Planning

  • Top E Commerce Trends in future

    There has been exponential growth in technology space in the last few years. From improvement in internet speeds, better customer targeting to implementation of AI based engines for a better shopping experience, it has become almost a race to achieve better profitability and efficiency.

    Increased competition from existing large players and constant entry of new players, everyone is forced to adapt to new methods of looking for customers and marketing to them in the most efficient way possible.

    From the last few years, entry of mobile and social media has upended the traditional E- Commerce channels such as websites and opened new avenues to grab eyeballs. Of course, it has been very challenging to maintain track of such changes and adapt to them as quickly as possible.

    Here we are listing a few future E Commerce trends that are shaping the industry, from reputed sources that you need to be aware of.

    Continued Rise of Social Commerce

    It is probably the most important trends about future of E Commerce. Platforms such as Instagram, YouTube and TikTok continue to drive engagement in an inorganic way. To do this, they reward the creators that drives the users of the platform to view their content. Later, the content can be monetized and products sold either as a link or an in-content ad.

    The important part of Social Commerce is a sense of community. An influencer creating a content can either have a large following or leads a group discussing specific topics.

    The influencers are generally considered authority on their subject and their recommendations matter to their followers.

    With attention spans going down, Social Media platforms have introduced short form videos where it is much quicker to capture attention and direct people towards an objective for brand, either by attracting leads or converting them to sales.

    Rise of Automation

    The use of automation is necessary when you want to minimize human interface in a known and repetitive process. This reduces the chance of errors and help optimize the process. Imagine a human sending an email manually on order completion vs sent automatically by the software system. The chance of missed email is eliminated.

    The above example can be called as workflow, and many such workflows could be chained to form a complete process chain. This would ease the process and free up human resources for other important work and also that it minimizes any errors that creep up because of manual processing.

    The automation will increase with time as more rule-based Automation systems allow users to set up their own workflows.

    Entry of AI

    When we talk about AI, we need to differentiate between two types of AI as there can be confusion about capabilities of each type.

    Traditional AI: AI that is deterministic and that are known to have predictable outcomes based on the inputs. For example, predictive analysis and self-driving could be called as traditional AI.

    Generative AI: This type of AI helps in text, image and music generation based on pre-set data. It is easy to create a lot of new creative materials based on the existing datasets. It is usually unpredictable and requires human oversight on its output.

    More detailed comparison here

    While traditional AI is used to do further analysis such as Inventory management, seasonality predictions and supply chain management, generative AI will be used to further automate customer processes such as chatbots, visual commerce and price optimization.

     

    Virtual Reality

    The emergence of Virtual Reality and Augmented reality might have a significant impact on E Commerce. The devices allow users to experience a product in almost real time. One can also do product demonstrations in three dimensions and make the experience immersive.

    You might have already seen the process of trying on for example, spectacles, clothes or make up on your image or a computer-generated image.

    The next stage would be for you to take a walk into an integrated, virtual store and pick and view products. You can then later add these products into a shopping cart and pay for them getting the feel of an in-shop experience.

     

    Conversational Commerce

     

  • Top Categories in E Commerce World

    E Commerce has been on a constant growth path over the years. The categories have grown multi-fold. Some of the subcategories now even classify as categories of their own. This shows the extent to which E Commerce has swept the shopping mania across the world.

    Here are some of the most popular E Commerce categories based on the demand. I have taken the top categories based on the top-level categories displayed by Amazon in their menu. Also added are some stats to give you a perspective on why these might by the top-level categories.

     

    Electronics

    According to Research and Markets, electronics today account for $789 trillion worth of market , expected to grow to 1.2 trillion in 2032. The top contenders in this category are mobiles (cell phones), laptops and computers, gaming, audio and video equipment.

    In addition, there are

    • Musical instruments
    • Software
      • Wearables
    • Office Equipment
    • Headphones ( yes, they are in there)
    • Car Electronics

    As you can see that the categories evolving, even smaller categories are getting a space of their own.

    With ever evolving technologies we can see more categories being added to this top-level category.

     

    Computers

    Other than just electronics, computers form a top-level category of their own. According to a research paper, personal computers market is experiencing a growth of 8% CAGR year over year

    Computers category contains Computer, PC, tablets. Then there are supporting categories such as

    • External monitors
    • Disk Drives
    • Printers
    • Network Storages
    • Specific components and parts

    Home, Garden And Tools

    Home décor, gardening and related tools and accessories are a top category on the Amazon Website. According to Technavio research, the category is growing at 13%, which is phenomenal. The category is very wide because it essentially covers what is involved in management of a home.

    A few important subcategories are

    • Home Décor
    • Furniture
    • Kitchen
    • Dining
    • Gardening tools
    • Utensils
    • Cleaning supplies
    • Kitchen Gadgets

    Pets Care

    Pets Care as E Commerce category stands to grow by 7-8 % CAGR over the next few years. Primary subcategories are

    • Dog Food
    • Cat Food
    • Apparel
    • Pet Waste treatment
    • Furniture for pets
    • Aquatic pets
    • Reptilian pets

    Food And Grocery

    This category holds a dominating share of E Commerce market across the world . Based on one report, the market for grocery is growing at about 25% CAGR.

    The top subcategories under this category are

    • Canned and packaged foods
    • Coffee
    • Chocolates
    • Snacks
    • Breakfast
    • Cooking and Baking
    • Drinks
    • Sweets
    • Beverages

    Beauty And Health

    Beauty and healthcare is also a rapidly growing category in E Commerce. The category has a huge size just because of presence of influencers, social media tools such as YouTube, Instagram and TikTok. In USA alone, the beauty category is growing at 23% plus.

    The top subcategories in this segment are

    • Personal Care
    • Skin Care
    • Hair Care
    • Makeup
    • Perfumes
    • Foot care
    • Beauty Accessories
    • Shave and Hair removal

     

  • Key Metrices for a small business E Commerce project

    Key Metrices for a small business E Commerce project

    Metrices are the numbers that are used to understand the performance of any project.  Your small business E Commerce software too needs to focus on certain metrices that will improve your sales efficiency and enhance the customer experience.

    Large corporations track multiple metrices across their large landscape of E Commerce. For a small business, however, it might be quite difficult to track so many metrices as it can get overwhelming.

    Here, we list a few top metrices that you can consistently check and evaluate your performance for your E Commerce project.

    Visits to your website

    The biggest problem for a small business E Commerce website is its discoverability. You have just entered the highly competitive landscape of E Commerce on internet, and you realize that you are not getting the traffic you were expecting even if you possess the most unique products. Increasing visits means your site is getting known and getting featured on search engines.

    Conversions

    The next most important question to ask is that what percentage of visitors are converting to customers or at-least signing up on your website. It is important for a small business to track it because the advertising resources are limited and you want a high conversion rate for the visitors. So, a good ratio to check would be Number of sales ( or sign ups ) done / Total number of visitors to the website.

    Bounce Rate

    Bounce happens when a customer visits your site and just migrates away. Bounce rate is also an important indicator for search engines to evaluate, if your website is providing the needed content for the traffic they are sending your way. If the bounce rate i.e., number of users leaving site upon visiting first page/ total number of visitors is high, then it may signal to the search Engine that something is not right with your website and it needs tweaking

    Shopping card Abandonment

    Shopping cart is considered abandoned when user adds the product to cart but does not move forward with intent to closing the sales. It can mean that either shopping cart to check out process is difficult or user finds out that the closing price does not guarantee the value that you are offering. Shopping cart abandonment leads to sales loss and affects conversions on a higher scale as customers have given up on your products just in the final stage.

    Return rate

    A major source of headache for business owners, small or large in E Commerce segment is the returns from the customer. High rate of return means either the customer has a mismatched expectation (in terms of colour, size, or weight) or the policy about return is too lenient allowing the customer to use and send the product back. High rate of return could also mean that customer is not satisfied with the quality of the product that they see online.

     

    Website loading speed

    The biggest source of frustration of a user and the most important factor for the search engine is website loading speed. Slow websites lead to higher bounce rate. They also mean that your shopping cart may be abandoned much more than a faster website. If you self-host your website, the loading speed is often your responsibility. You may use a number of online tools to help you increase your website speed. Remember, slow website is equivalent to money lost.

    Photo by RDNE Stock project

  • How to find sources of funding for your E Commerce Project?

    How to find sources of funding for your E Commerce Project?

    Any E Commerce business need funding for starting up and for ongoing activities. In the age of internet, finding funds have never been so easy. There are multiple options to finance your e commerce dream. Here are some of the ways in which you can secure funding for your E Commerce business.

    Bootstrapping (Family/Friends)

    Bootstrapping is one of the easiest funding sources that you can deploy. You can use your own savings or ask your family or friends for funds, in return for promise of revenue or shares. Bootstrapping removes one large pressure of paying monthly instalments for e.g. to a bank. You often do not need to part with equity as you may get support from the family just based on personal relationships and not wanting much back in return.

    You are thus free to pursue any strategy you see fit without needing investor approval. This provides unimaginable flexibility to pursue your goals.

    The issue with this type of funding is that personal or family funds are limited and you need to show results at some point otherwise your finances may be stretched. Also, the funding may not be sufficient to meet the need of an E Commerce project based on the scope forcing you to look for other sources of funding.

    Bank Loans

    Bank loans are essentially given by the banks to an entrepreneur or businessman based on a business plan and other criteria such as repaying capacity or revenue forecasts. Banks may require a collateral to issue your business a loan. The loans may be short or long-term depending on your needs and bank’s decision.

    Once you submit your plan, banks issue the loan. The loans have conditions attached to them such as how much is repayment period, and how much is the interest charged on the loan. Based on your credit history with the bank, you may ask for lower interest rates from the bank.

    Since bank loans are secured with collaterals, you may lose collateral if your business is unable to pay the instalment. This is different compared to personal loans where often no collateral is desired. So, you need to be strategic with the fact, that not paying the loan back may cause bad credit history and future denial of loans.

    Business Credit Cards

    Entrepreneurs often have the habit of using personal credit card for funding their E Commerce business but that causes some problems. Using personal credit card for business means your personal and business expenses are now on the same card. It makes reporting difficult and bloats your card expenses.

    A better way to separate spending is to apply for business credit card. Business credit cards are similar to personal credit cards but with higher interest rates that business loans. This is because the credit provided to you with a business credit card is unsecured.

    With business card, there are advantages such as building a credit history with your loan provider. You may use the credit card as any other credit card paying for expenses (even rotating the credit) and earn points based on the spend.

    Banks may ask for your credit scores and your past repayment history to issue you a credit card. Remember that it is a responsibility for you to pay your dues back or interest penalties may become too much to manage.

    Crowdfunding

    Crowdfunding is another noteworthy method of financing. Crowdfunding uses social media or crowdfunding platforms to initiate funding for startups. Often investors scout these sites looking for next disruptive product or technology and innovative ideas get funded quickly. The advantage of crowdfunding is that there is no repayment obligation such as monthly repayment instalment and the “crowd” invests on either your personal history or their perception of your product. You do not even need to share your equity with the donors. Often the donors become your target market or your amplification marketeers because they have a stake in seeing your product succeed.

     

    VC/Investors

    VC or Angel investors could be toughest funders. Even though they are nothing like banks i.e., you do not need to supply a collateral or make a monthly payment, what they demand is something else, equity in your business.

    You will get connections, large amount of money, mentorship in addition to elevated media presence. However, now you are strictly bound to the performance. You might even need to change your business model so that your VC can move it to 10x their returns.

    Thus, your original idea may be distorted to the point where you no longer recognize it. It can be demotivating. But the success, which is often huge, may mitigate those circumstances.

    The VCs may have an upper hand in decision making. In certain case, after a few rounds you may end up as minority shareholder. This discourages many founders to see VC funding even though the scale that this funding provides is tremendous.

    Customer Advances

    Photo by www.kaboompics.com

  • How to start your E- Commerce business with no money ?

    How to start your E- Commerce business with no money ?

    Can you start an E Commerce business for a little or no money? For sure. You can utilize a number of channels other than the standard domain name and website. With enough innovation and creativity, you may utilize many channels available to sell your product without spending a dime.

    Previously, you would need a website and a domain name to sell your products but of late, it has been very easy to reach to relevant people without destroying your bank.

    Listing your product on large E Commerce Portals

    It is quite easy for anyone to start an E Commerce store almost for free on large E Commerce Portals. These include Amazon, eBay, Etsy and a host of others. All you need is an id and email and you can start listing your products for free. The initial fees are minimum and help you avoid capital expenditure.

    Just make sure that you are truthful about what you are trying to sell and write great product titles and description.

    Marketing using word of mouth (offline marketing)

    Word of mouth is one the free technique that you can employ for your marketing. You can always ask your friends to promote your store. You can create short URL of your shop and share them with them.

    You can also place flyers in local newspapers about your venture. You may add compelling offers to induce people to visit your site/ or your social media page.

    Social media marketing

    If you have an expertise in certain area, you can create tutorials, walk-throughs, how-to videos and place it on YouTube or Instagram. These sites allow you to upload videos at no cost. To create such videos, you may use open-source tools to create and edit your videos.

    Consistently creating a user base using social media posts helps create trust between your business and audience at almost no or minimal cost.

    Writing content yourself

    You are going to run the shop and sell the products and thus it can be assumed that you have deep idea on how to best use your products.

    If you can convert that knowledge into words and start a blog based on those words, you can start seeing free traffic from Google. You may use free software such as WordPress to host your content. You may also use free content hosting sites for writing your posts till you migrate to your own platform.

    Sell from social media itself

    These days social media companies encourage you to create content and sell products from your content. This is great for people with minimal budgets. Also, maintaining an E Commerce website is costly. Using social media pages and videos to sell your content is a great way to save on costs.

    Buying your brand domain(optional)

    If you can afford to buy a domain, you should. Your brand is the one that identifies you.

    Buying a cheaper domain and a cheap hosting space to host a basic website (minus any E Commerce functions) is better than not having a domain at all. There are a lot of ways you can lower down your prices of domain. For example, using comparison sites to compare prices or buying multiple years upfront to minimize average cost of renewals.

    As you can see, there are many ways to sell a product or service, even if you put a small or no capital.

    Photo by Marsel_Shots

     

  • Essential features of an E Commerce site

    Essential features of an E Commerce site

    Clean and Mobile friendly homepage

    An essential part of E Commerce site is a good layout and page design. The headers should contain relevant links in a neat orderly way.

    The main content box should display your best offering and / or any promotions that you are running for this season.

    The website should not take a lot of time to load and it should be mobile friendly. This means that images and text should scale to meet the needs of a mobile user. Since there are a lot of resolutions and types of mobile phones , your website needs to be thoroughly tested on as many of them as possible.

    Easy to find contact information

    Contact information for your website should either be present on the home page or a dedicated page depending on your business scenario. Your contact information may be a phone number, email address or social media handles.

    It would be great if you have an address and you display it in a prominent location.

    It is so frustrating when a website has infinite scroll of product listing. The contact information is often tucked into the bottom of the scroll and by the time a visitor reaches there, Make your contact information easy to find and your visitors will trust you more

    Good product details

    A nicely written product heading and description will work wonders for your E Commerce site’s reputation. Clean graphics and sections organizing the information indicate that you take your business seriously and your work is professional.

    Great images

    Good quality images enhance the value of your product line. Great product images available in multiple resolutions from different angle helps a visitor decide if they wish to make the purchase or move on to something else.

    Easy checkout

    If a visitor is here just for one product, you need to make it easy for them to purchase it from the main page or the product page. That means, providing a way for instant checkouts ( with or without requiring logging in ).

    If they have multiple products, you need to provide them to review the items/prices in for example a shopping cart page and then allowing them to make the purchase . You should be able to provide them a place for putting in discount coupons. On the other hand a running promotion should apply automatically to their cart.

    Wish List/ Save for later

    The benefit of an online store is that a visitor may not buy immediately but save the items in a wish list for purchase later. You may analyse if there is any way you can motivate the user move items from wish list to shopping cart. Wish list also helps you analyse which products are in demand and also if anything can be done to make sales of them faster.

    Customer support channels

    Customer support channels form an important part of your interaction with your E Commerce visitors . A common support channel is email and it gives you some time before you need to respond.

    On the other hand , a phone needs an employee to man it. You may also use whatsapp , which is very popular for solving customer issues.

     

    Photo by iMin Technology

  • Costs in starting an ecommerce venture

    Costs in starting an ecommerce venture

    E Commerce has a multiple number of costs associated with it. Let us take a look at some of them at the top level. We are deliberately not including the costs that are common to all businesses such as inventory costs and transportation and shipping

    Web Hosting and domain costs

    Every E Commerce project if hosted on its own domain would need a domain name and a hosting space. The domain name also needs to match up with the brand name that you plan to use.

    The hosting space is needed to host your product, customer and sales data. The hosting space usually is bundled with the domain name costs if both of them are purchased together.

    Software costs

    If you are planning to use free open-source software, you would not need to spend any money upfront as software cost. If you are opting for hosted solutions provided by providers such as Shopify or if you are hosting on large E Commerce portals you may need to pay fees related to listing of the product.

    In case you are using a hosted solution on your own, you might need SEO plugins, payment gateway plugins, email management, inventory management and other software. These may or may not cost money and you need to do your research to determine the costs associated with them.

    Technical support costs

    Even though your software may cost nothing, you may be lacking either in time or in skill to install and run it properly. You would also need to customize it to suit your brand image. These processes involve a consultant which can help you make these customizations. Based on the complexities of your need, consulting work may range from cheap to really expensive. If you decide to do it all yourself, you will need the time to learn them on your own. This may take your attention away from your main business.

    Digital Marketing

    Digital marketing includes running ads on Google and social media platforms such as Facebook, Pinterest or Instagram.

    You would also need to pay influencers to help promote your products

    Also , if you wish that your customers discover your products when they search about it on Google , you would need to pay Google to run ads on your behalf.

    You would also need to create blogs and pay content writers a sizeable amount for writing posts about your products.

    Customer Support costs

    Customer support is an essential part of E Commerce project. You would need to be able to answer emails or calls from telephone. The internet users are often fickle and quick to take offense, so it is important that issues are resolved as soon as possible. You would also need to set up processes with your logistic providers as returns are a big part of your E Commerce system. These all need employees and thus may cost money.

    Cost of product listing

    Product is not just a static thing. It comprises of text, images and manuals associated with it. To make product look interesting you would need to hire artists who can add a bit of design to the product details such as an explanatory graphics. You would also need to redesign manuals to make them fit the web standards. You would need to take good photographs of your product from different angles and different sizes/resolutions.

    These too cost money and thus they form a line item in your cost calculations.

    Photo by Yan Krukau

  • Starting a luxury ecommerce business

    Starting a luxury ecommerce business

    Luxury segment is a highly profitable, high margin segment of retail business. Luxury shoppers are spoilt for choices in offline world, and they will expect the same if you take your business online. The luxury buyers want a similar experience when they visit your online store. Here are a few things to keep in mind when starting or running your luxury online store

     

    Customer Experience matters

    They are here for the best of the breed product. Of course you cannot have a shoddy website. Your website should be clean and neat. It should be easy to navigate. The format should follow your brand style. The website should load fast. The images should load fast. The links should all be working. The layout is friendly and bold. Everything that you do at your offline store should be replicated to maximum possible extend here on the website.

     

    Personalization matters too!

    Personalization is necessary for your website. Just like as you walk into a luxury hotel or a shop, the manager of the shop often remembers you and greet you. That shows that you are exclusively recognized by the store.

    In the web world, there are many ways to remember your customers. You may use cookies to remember them or provide personalized service when they login. You may use an exclusive number or personnel only available to them. You may also show up products relevant on their past purchase history or upsell them new product lines.

    Visuals matter!

    Would you be interested in for example. buying a luxury watch, if there are shoddy display of the watch at the store front. Of course, not. Similarly, your web presence also should be full of images where you showcase your product just like you would in the offline world. And these images can be rotating to show the product in different perspectives. For example, in one image, watch should be shown in a case. In another, there could be a model shown wearing the watch. All these items should display exclusivity that only a few people in the world can afford.

     

    Exclusiveness

    The point of luxury store is exclusivity. If the product is available on every other online store, your buyers may feel that the brand is not catering to specific clients but to everyone in the world. Your products are costly for a reason and that is they are not available beyond select locations. And if you can create something exclusive to your web customers, you further add to the exclusivity. That would drive interests and make sales happen faster.

    Packaging and delivery

    Exclusive web stores need to offer exceptional packaging of the product and regular updates on delivery. They need to connect with the best of the breed suppliers and make sure their services are top notch. The notifications should be creative and should make the customer excited about the product they are about to receive. You may add personal messages and letters inside the delivery box thanking them for the purchase and place to call, in case they are not satisfied with the purchase.

    Post sales service experience

    You don’t just want buyers to feel exclusiveness just during buying. You want them to feel special all through the sales and post sales process. Your service line should be manned for all the shop timings mentioned. There should not be a sense of hurry in understanding customer issues. Urgency should be shown in handling customer complaints. Suggestions need to be honoured and implemented. Nothing speaks more to the buyers than the fact that their words are acted up.

    Photo by Kampus Production

  • How to successfully compete with E Commerce Giants

    How to successfully compete with E Commerce Giants

    So, you have decided to venture into your own E Commerce business. Welcome to the world of possibilities. There are more opportunities than even before in this area. However, you also need to know in this sea, there are giant sharks. Large E Commerce companies with huge marketing budgets and often predatory tactics can reduce your profit margin in a straightforward way to causing your venture to shut down at the extreme.

    Here are a few ways, your small or medium size E Commerce venture can compete against these sharks in the E Commerce world.

    Planning

    E Commerce startups often underestimate the importance of planning. You are stepping in a place where there are giant sharks waiting to eat you for lunch. You need to be able to find out how you are going to out compete. You need to do thorough research about their marketing and their strategies. It is similar to guerilla marketing tactics where you are the nimble task force fighting a mighty army. Planning at the strategic level as to what things you would compete upon (like offering/ price / customer experience) and then at the tactical level such as what steps would you take to make your offering better w.r.t. to your large competitors. It needs careful considers and market research.

    Local flavor

    Your large competitor is stretched thin. The segment they are in needs to be profitable enough for them to give you competition. They will find it difficult to conduct operation in every local segment. You may leverage your knowledge of area, local product, local language to create a strong offering that your competitor simply cannot match without devoting substantial resources to achieve similar results.

    Strong niche

    Your enemies i.e., the giants of E Commerce are often stretched. They have cost structures and often optimize for sales and cost. It is impossible for physical reasons for them to focus on every segment of the market and yet win profitably. That is where you can shine. You can determine the areas where you are strong. It could be your price because of sourcing, or it could be quality of your product or patents that you hold.

    If you perform well and deliver value, it will be difficult for the large competitors to dislodge you.

     

    Personal Connections to the shoppers

    E Commerce giants provide services that are automated. One needs to go through multiple levels of chatbots conversations, and AI provided answers which causes dissatisfaction. On your website on the other hand, you can provide a work phone and /or a WhatsApp number for rapid answers to your customer’s questions. You customers may like such levels of personalization.

    A thank you note to the buyers and if possible, a call asking them about their satisfaction of the product is how you build a long-term relationship with them.

     

    Your personal story

    If there is a business, there is a story. Is there a story for your business, a customer can instantly connect with and identify with?

    For example, often stories talk about how founders struggled through their life experiences and then stepped up to provide you the best of the breed solutions. A personal story helps a customer relate to their own experiences of struggles.

    You need to make sure that you have genuine reasons behind your story as your honesty will be rewarded with free advertisement and sales later.

    Unique marketing techniques

    Giant e commerce companies use billboards, big festivals and big ad spends to attract eyeballs because they have big budgets to spend.

    To counter, you can go low cost, high impact tactics such as surprise gifts, detailed content videos for example tutorials/ how to use your products. You may utilize humor to craft engagement that suits your product line and not cater to whole market that your large competitor needs to cater to.

    Leveraging social media to the maximum

    Social media is easy and cheap medium to get famous. Create and share posts and ask your friends and family to share them on their timelines. It instantly builds up the trust without need to spend additional money. You can also create product pages and share helpful content and updates. You can create group where you can share your expertise and even others can chime in too with their opinions. Keep an eye open for the feedback and respond personally and constructively.

    Image by Waldryano from Pixabay

  • Why E-Commerce businesses fail?

    Why E-Commerce businesses fail?

    It is said that build and they will come. Unfortunately, it is often the case that after building, one needs to do a number of things to attract them.

    Like any other business, E Commerce too is prone to failures. E Commerce projects are often brittle because they have a number of components that need to be glued together in perfect synchronization or they might fail to give the optimal result.

     

    Here are a few reasons any E Commerce business may fail:

    Competition:

    E Commerce is usually a business that can be started in a few clicks. Unlike other businesses, which need a shop with physical and also licenses to run it, E Commerce businesses are virtual. You sign up, list the product and you are live. But if you can do it so cheaply and easily, so can anyone else. And if your product is generic, it is possible that people might not see your product over those already listed by others in highly competitive marketplaces.

    The competition for E Commerce is global and if your product can be purchased cheaply from locations around the world, it will be.

    Discoverability

    It is hard to rank for keywords related to your product, if your product is generic or very commonly sold. However, even if your product is exclusive, it may take days before your links are recognized by a top search engine and given its due in their search pages. Often to get discovered, you will need to pay to search engines and social media giants.

    Getting discovered organically is hard work and it needs sustained budget and work. A one-or-two-person team may suffer burnout just to market the product on web.

    Customer feedback and issues

    A big problem with E Commerce project is that it is hard to meet the expectations of customers that purchase online. In a clothing store, for example, the size or the colour of the clothing may not match the one that is shown on the website. So, the dissatisfied customer may expect a return or refund. In some cases, they might leave a bad review or file a legal complaint too.

    Customers may fraudulently return used articles with damage done to them. This lowers the possibility of having a good margin and increases chances of failure of your E Commerce project.

    Supply chain issues.

    In a physical shop, a customer comes to you. In an online store, you ship the products to the customer. And that has its own set of issues. You need to negotiate shipping conditions with your shipping partners. The more customization you do, the more you need to pay. You also need to factor in the pickup costs in case of returns or damages. This makes the costing process go haywire.

    Website problems

    There could be plenty of problems with your website starting from poor response time to broken payments integrations, errors in software etc. The website software needs to be continuously updated and monitored for issues. And that costs money, time or both. You will need to connect with vendors to provide the necessary support. It may exceed your budget provisions.

    Fees and charges

    Hosting of website or listing your products on a large marketplace looks easy at the first glance but there are charges to keep things running. A large marketplace may charge you list your product, may take a cut from your sales and force you advertise of their website.

    If you run your own website, you need to pay for domain and hosting provider. You may also need to pay for the tools related to complaint management, marketing and email automation. The costs can add quickly.

    Insufficient budgets

    This all leads to the most important reason an E Commerce project may fail. Insufficient provision. Even though, E Commerce is relatively easy to start but often the hidden costs add up quickly. If you don’t provision enough money, then your project runs the risk of failure. Always make sure to think of all the aspect of an E Commerce costing before you start an online store.

     

    Photo by Benjamin Farren