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Setting up an ecommerce site is easy. There are ecommerce store solutions that can create snazzy stores for you in a matter of minutes. However, running an ecommerce business is a totally different ball game. Attracting traffic and generating revenue in the face of fierce competition is not easy. However, businesses that manage to avoid these basic missteps can gain traction and make excellent profits.
1. Making things difficult for the customer
What does this include? Almost everything that you can do to turn customers away. It begins with a site design that is not intuitive and results in tedious navigation. In today’s market, this includes having a mobile optimized website. Not enough payment options and a cumbersome purchase process result in customers leaving empty-handed even as they are on the cusp of completing a purchase. Add low-quality images and poor product descriptions to the mix and you have put together a potent combination that will definitely prevent your ecommerce business from taking off.
2. Not targeting customers
Customer acquisition is one of the biggest costs that ecommerce sites incur. Businesses that do not have a system in place for targeting specific customer personas as well as marketing to existing customers will continue to spend excessively targeting the wrong audience. Even though first-time visitors drive 73% of online conversions, these are less profitable because of the higher cost of customer acquisition. Effectively targeting customers demands that you capture your customer’s information so that you can market in a more personalized manner and at a lower cost.
3. Low profit margins
Rookie ecommerce sites not only operate on low profits because of all the associated costs but also have to do business at a loss until they achieve economies of scale. Costs such as inventory, payment gateway fees, shipping, advertising, staff, and technology nibble away at profit margins. Incentives can be a cost as well if financials are not analyzed accurately, but in most cases can be a great way to build a customer base. Customers are always on the lookout for discounts and providing deals, contests, giveaways, etc can be a great way to build your database and expose your brand to more potential customers.
4. Not marketing your business effectively
Marketing an ecommerce company requires a lot of work. It needs savvy search engine marketing, social media marketing, and content that fulfills the latest search engine optimization requirements. Apart from expertise, these activities require funds for advertising and are intensely data driven. Analytics plays an important role in just about every activity of an ecommerce site. The choice of products, customers to target, platforms to advertise on, and even the choice of vendors is influenced by data. Take the time to fully understand your on-site analytics as well as the data your capturing from marketing channels, social media, and search engines to fully optimize your sales funnel and maximize profits.
5. Annoying your customers with hidden costs
Customer pet peeves that an ecommerce business should strive to eliminate include hidden costs that pop up at the time of payment, lax security at the payment gateways that can unnerve customers, compulsory registration on the site in order to make a purchase, and of course, not selling quality goods. At the backend of the business, you should focus on vendor management, logistics, and distribution tie-ups for a smooth customer experience at a low cost.
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