Ever since the dot-com boom of the nineties and the realisation that the owner of the online business comparethemarket.com (an insurance comparison company starring a meerkat) is in fact number 158 on the 2013 Times Rich List with a net worth of £550 million, a lot of people have had the same idea.
For those hoping to catch the wind with a niche new idea, setting up a business selling products or services online didn’t seem to require too much capital and surely allowed for a potentially global market, leading to vast amounts of revenue and $$$, no?
Well actually, not always. If the first Ecommerce business you set up didn’t do too well, here are seven reasons explaining what you might have been doing wrong.
1) You Didn’t Attract Enough Traffic To Your Website
The Internet is a vast and sprawling place and it’s easy for some sites to get lost. There is little truth to Kevin Costner’s famous maxim, ‘If you build it, they will come’, so market your website by:
- Setting up a Facebook page and Twitter account as part of your social media strategy
- Buying for pay-per-click advertising
- Making your website SEO (Search Engine Optimisation) friendly, so it appears higher up the list on search engines like Google
- Creating video advertising for sites such as YouTube which attract a lot of traffic
- Sending out press releases detailing new products or services
- Collecting customers’ email addresses so you can send out a monthly newsletter containing promotional offers and competitions- this attracts repeat business
2) You Had No Prior Knowledge Of Retail
The promise of ‘getting rich quick’ via Ecommerce has led to many people who have no prior knowledge of retail or internet technology setting up businesses online. It’s possible to pay for other people’s expertise in these areas, but if you’re unable to apply the skills you’ve gathered throughout your career, you must seriously question if Ecommerce is right for you.
3) Your Website Looked Unprofessional
Any website that looks remotely ‘homemade’ sends out an air of unprofessionalism to the customer, making them question everything from the quality of the products available to potential delivery problems.
If you’ve set up an Ecommerce business it’s likely that numbers, spreadsheets and profit margins supersede design for you, but don’t underestimate the value of appearance. It’s worth shelling out for a professional website designer in the early stages.
4) You Weren’t Competitive Enough
This one is crucial. Many people seek out bargains on the Internet these days as it affords the luxury of shopping around before you buy. Lots of research into the various aspects of why one website is better than another to buy from will have come into play in any one purchasing decision.
If your site doesn’t offer competitive prices, promotions or other incentives to buy from you rather than anyone else, you can’t expect high sales figures. Ask yourself some key questions:
- Were there enough pricing options for delivery?
- Was delivery fast and reliable?
- Was there a simple and easy returns policy?
- Was the payment system properly and reassuringly secure?
- Could the experience have been better for the customer in any way? Perhaps you could even have improved your packaging to make it more appealing to the buyer?
Small details matter if you hope for repeat business and there are multiple ways to outdo your competitors. Why not get creative?
5) You Refused To Lower Prices
This is linked to the point above but can be a specific reason why Ecommerce businesses fail. Whilst it can be agonising to lower prices when you’ve projected profit but end up making a loss, if it means you’re offering the cheapest (but still the best) products in a competitive market you’ll end up the winner.
6) You didn’t give it enough TIME
As with all things, it takes time to become successful so if you know you’re doing everything right, just give your online business a little time to grow.
Time allows for knowledge of your site’s existence to spread through word of mouth, links via Facebook and Twitter and mentions on other more well known sites.
If you update your products regularly, keep prices competitive, maintain high quality customer service and carry on attracting buyers, you WILL eventually reap the rewards of your hard work.