Every new year comes with new trends and new technology. And also these changes present great growth opportunities for E-commerce companies and online retailers who are equipped to tackle them head-on, and also they can present challenges for business.
E-commerce retailers who want to outperform the competition and overcome the challenges will need to be on the cutting edge of how the industry is growing and changing. Here we discuss the top 5 common challenges that E-commerce retailers will have to overcome to be the most successful:
- Competitor Analysis: In the super-competitive E-commerce business environment, others will offer the same products and services as you. Unless you have your own strategy to differentiate yourself, it is difficult to survive.
You need to conduct a thorough competition analysis to find out what products your competitors are offering, how much they’re selling it for, and what platforms they are using to connect with customers. Figure out what products are high in demand and remove the ones that aren’t.
- Absence of Identity Verification: When a visitor goes to an e-commerce website and signs up, the portal is unaware of the customer. Whether the customer information is genuine or not it’s questionable. Cash-on-delivery (COD) purchases using invalid phone numbers or addresses can lead to huge revenue losses.
By taking the proper steps to verify the customer’s information you can solve the problems. First of all, lookout for signs of suspicious activity, check the zip codes match with the state/city. Then send a verification link when a customer signs up, via text message or email, to validate if the customer is genuine. Also, you can use software solutions.
- Maintaining Loyalty: It can cost up to 5 times more to acquire a new customer than retaining an existing one, and the success rate of selling a current customer is 60-70% compare to only 5-20% success rate of selling a new customer.
To maintain your customer loyalty, you must provide excellent customer service, be transparent, blog regularly, send emails, and create positive experiences for your customers so that they trust you.
- Product Return And Refund Policies: A survey by ComScore and UPS, showed 63% of online shoppers say that they look at a retailer’s policy before making a purchase, and 48% would shop more with retailers offering hassle-free returns. When a product is returned, the business suffers a heavy loss in shipment and reputation.
Return and refund policies are also part of great customer service and e-consumers are clearly conscious of return and refund policies. So, never hide or try to trick customers about your return policy, be transparent, and make sure that policy is easily accessible on your website and finally avoid words that are difficult to understand.
- Competing Against Retailers And Manufacturers: There are so many online businesses that buy their products from manufacturers and retailers. Unfortunately, due in part to E-commerce’s low barrier to entry, many times these retailers and manufacturers also sell the same products directly to customers.
To solve this problem restrict the manufacturer from selling the product directly to customers by selling this out in the contract. But it will not be possible for every manufacturer, but you can work with smaller manufacturers.
As there are multiple challenges faced by E-commerce businesses, you must be prepared for challenges and attempt to grow at every stage of your business. With a few simple solutions, you can solve those issues and focus on running your business instead.
If you have any questions, let me know and I’ll help you start or scale your eCommerce business. To find out the details please join my Facebook Page/Group and connect with me.
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