The Top 10 e-Commerce Challenges for Business Owners

Having a successful e-commerce website can be a major boon for the business owner. To begin with, an online website reduces the costs inherent in running a “brick-and-mortar” operation, including rent, licensing fees, insurance and employee salaries. Likewise, an online store is conveniently open 24 hours a day, 7 days a week, and 365 days a year, enabling business transactions to occur no matter what time of day. Finally, an e-commerce website has the advantage of proximity; customers can be from any part of the globe yet have immediate access to its virtual storefront.

While the benefits of having an e-commerce website are numerous, there are some challenges as well. To begin with, many merchants do not understand the amount of time and effort required to set up and maintain an e-commerce website. Effective e-mail marketing, site optimization, content generation, template creation and shopping cart installation all require a significant investment of professional resources. If the e-commerce merchant wishes to generate traffic via social media campaigns and article marketing, these efforts require the hiring of personnel who are knowledgeable in such tactical approaches to gaining customer interest and trust. Challenges such as these can limit the effectiveness of an e-commerce website; however, knowing what they are is the first step to also addressing them as opportunities for improvement. Even e-commerce merchants who are well-versed in online marketing techniques can take the following advice to heart to improve their site ranking, traffic and conversion rates, and product branding. After all, when it comes to e-commerce, keeping up with the pace of consumer interest and need is an ongoing process of improvement.

1. Customers won’t trust your website

Regardless of whether your website has a sophisticated or crude layout, and regardless of whether you’ve hired a team of professional designers to create your company logo or simply transposed what you doodled on a paper napkin, customers will not automatically trust your website. If there is no trust, it is unlikely that sales will follow. This is especially true if you are trying to sell big ticket items that carry a sizeable purchase price or shipping cost. Make your website legitimate in the eyes of potential customers by displaying your store’s physical address and telephone number. If possible, list the names and photos of the individuals (including yourself) who help support your website’s or store’s operations. Customer testimonials are also helpful, especially if they can be posted to a forum or blog-like site that helps verify that these testimonials are genuine. Finally, join at least one best practices organization, such as the Better Business Bureau.

2. You will need to work on site SEO

Most e-commerce sites are not placed at the top of the SERP because they only list their perfunctory products, services and prices. You can use SEO to position your website at the top of the SERP by providing detailed product descriptions containing unique content. Consider adding a 100 word minimum product description to your most popular products, including target keywords and long-tail keywords in that description. Product reviews are also useful, especially if they span 300 words or more and include a photo or video. If you really want to gain customer interest and increase traffic to your website, post buyer guides that describe the features and benefits of your product category. Educational posters, brochures, interactive tools and even e-books can also help position your site as one of the top search engine finds.

3. Take advantage of social media- but only if you know how to use it well

According to an L2ThinkTank report, at least 63% of Generation Y members use social media to interact with company products, while another 50% report that Facebook blogs and/or videos influence their product perception (3). This means that e-commerce merchants who effectively use social media platforms like Facebook, Twitter and LinkedIn stand to benefit from increased brand awareness as well as an improved online reputation. However, the risk of a backlash also exists; for example, e-commerce merchants who use social media strictly to push their products will inevitably be blocked by the community. Likewise, an e-commerce merchant cannot leave sporadic posts and expect a positive response; once social media is chosen for marketing, messages to the platform should be updated almost daily, and any inquiries or complaints promptly addressed.

4. Beware: your website will be hacked

No matter how small and insignificant you perceive your e-commerce site to be, it is very likely that it will experience a security breach at some point in its existence. This could spell disaster for your customers, who might find their credit card and personal information compromised. Likewise, you might find yourself completely locked out of your own website, your payments redirected to another site, or your page content and website features scrambled. Protect your customers and yourself by regularly changing your passwords, customizing the installation of your shopping cart (e.g., changing database location), finding out the key vulnerabilities of your web and/or FTP server, etc. Also, check regularly for any reports of e-commerce security breaches.

5. Master the sales funnel and increase your conversions (i.e., sales)

You might have a high level of traffic going through your e-commerce website yet very few resulting sales. Conversely, your website could be generating a lot of sales that inevitably become product returns and refunds. To figure out where and why you are losing potential customers and/or sales, you will need to understand how the sales funnel works and how your own website fits into this model. In essence, a sales funnel is a directed path through which your customers move from the time when they first enter your site to when they finally make a purchase. Every page of your website should perform a given objective of the sales funnel, moving customers from point A to point B and onto C. The easier you make these transition points for your customers, the more likely it is that your customers will purchase from your site (i.e., convert).

6. You need a multichannel shopping platform

When it comes to shoppers who utilize one channel (i.e., brick-and-mortar store) versus those who utilize multiple channels (i.e., both brick-and-mortar and online store) for their shopping needs, the multichannel shoppers spend 82% more per transaction. This not only supports the idea of you offering an e-commerce option for your customers, it also suggests that you integrate your e-store with social media shopping platforms such as Facebook stores (F-stores). Furthermore, successfully integrating social media shopping platforms into your sales funnel will require connecting your social media users with your website landing pages and shopping carts, as well as enabling single logins and quick checkouts.

7. You need to define your site’s privacy settings

About one-third of all social network users take steps to limit the amount of personal information that is available online about them, according to a study performed by Pew Internet. Given the recent reports about user credit card information being accidentally leaked by certain online sites, trust will be the issue determining whether or not consumers use and purchase from your website. At the very least, you need to post a privacy policy on your website that defines what and with whom user information is shared. Likewise, you should provide a way for users to opt-out of sharing their personal information.

8. Use deal-of-the-day sites to your advantage

Consumers who shop online are presented with a plethora of e-commerce sites, social platform ads, clearance sales and deals galore. How can you engage potential customers so that they purchase from your website? A growing trend in the past year has been to use flash sales, group coupons, and pop-up stores (i.e., F-stores) to gain customer interest. By providing something unique in these promotions, whether that something be a product, exclusive information or a video, you can attract customers to your website and increase your conversion rate.

9. Get involved with mobile commerce

As smartphones and tablets proliferate, consumers are increasingly using these devices to do their online shopping. For example, Amazon reported that in its second quarter of 2010, over $1 billion in sales was generated via mobile devices. Other consumers are using their mobile devices while shopping in-store to obtain product information, compare prices and read user reviews. Therefore, developing a utility app that displays your e-store’s products on a smartphone (or delivers a unique offer via 2D barcode) is a great way to capture the mobile device market.

10. You will be using crowdsourcing

Crowdsourcing has made customers an integral part of company marketing and product design campaigns; for example, Frito-Lay recently asked its online fans to create Super Bowl ads for a chance to win $1 million. Starbucks asked its customers to submit ideas on how the company and its brand could be improved via a campaign called “My Starbucks Idea”. Such approaches encourage customer brand loyalty and are more likely to result in positive viral advertising through user actions such as posting Facebook “likes”, Tweets, and Google +1’s. After all, customers always appreciate being valued not just for their capital but also for their ideas and creativity.

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