Mistakes to Avoid in E-Commerce
Though it often seems simple to set up an online store and create a virtual business, there are several easy to make mistakes that many entrepreneurs fall prey to.
In this article we will look at 1) the importance of e-commerce design, 2) important considerations in e-commerce endeavors, and 3) mistakes to avoid.
IMPORTANCE OF E-COMMERCE DESIGN
E-commerce in Today’s World
The internet has provided a unique platform to communicate and do business with others. The online e-commerce experience provides speed, convenience and widespread access to products and buyers. All these aspects make it an important medium for both buyers and sellers.
For these reasons, it is vital for any business to keep a focus on expanding its online business and make the best use of this option to expand and grow. For entrepreneurs and small business owners, it is especially vital because it offers a chance to do business with less overhead costs and investment.
E-commerce Model Basics
E-commerce involves buying and selling on products and services through an electronic medium using an electronic payment system. Transactions can be business to business (B2B), Business to Consumer (B2C) or even Consumer to Consumer (C2C).
Through online stores, customers can make purchases at any time during the day at their convenience. The website serves as a storefront with product displays, sales and promotions, order processing, payment and delivery. The experience is the same as a physical store except it is not bound by a specific time and there is less face to face interaction.
As with physical stores, e-commerce merchants have the task of communicating with the customer to showcase their business and let the customer know what is being offered. There are several ways in which a merchant can market to a customer. Some of these methods include email, website banners, classified advertisements and blogs. It is vital for these businesses to build trust and strong relationships with clients, both potential and existing ones. This can be achieved through quality products, efficient service and dedicated customer care.
E-commerce Model Options
For a company to achieve success in the world of e-commerce, there are several important factors to consider. The three basic pillars are:
- Brand Image: The company must ensure that nay e-commerce presence and activity is in keeping with the brand image of the business and its strategy.
- Align with Culture: Similar to the public facing brand, the company’s internal culture should also align with online presence. The company should conduct business in the online world the same way it does in the physical world.
- Align with Existing Channels: If the company does business already, any existing channels should be aligned with the online channels.
Types of E-commerce Sites
There are several different ways in which e-commerce sites are structured and do business. Whatever the model selected, it needs to follow the above three considerations. In addition, there needs to be careful planning to ensure that the online experience is smooth and issue free.
Some of these models are:
- Single Brand: A brand creates its unique online store and presence such as Louis Vuitton, Gap or Hermes.
- Marketplace: This is a virtual shopping mall where multiple brands and categories are available. Amazon, eBay, and Rakuten.com are examples of marketplaces.
- Vertical Marketplace: This is a marketplace which focuses on a specific segment of products such as Zappos and Zalando for shoes and Toys R us.
- Community Marketplace: This is a type of marketplace built around a lifestyle, s shared mindset or goal. Etsy, Craigslist or SkullCandy are examples of this.
- Crossover Stores: These are stores that are brick and click which means stores that have a strong physical as well as online presence. These include stores such as Target, Walmart, Crate and Barrel, and Barnes and Noble.
- Social Commerce: Often, e-commerce retailers set up a shop on Facebook or run promotional campaigns through different social media outlets.
IMPORTANT CONSIDERATIONS IN E-COMMERCE ENDEAVORS
It is a common misconception that setting up an online business is a simple task and leads to quick results. This is not the case. The real challenge is to create the right website that highlights the product, identifies a need to meet and pulls in the right audience. The second challenge is to ensure that all logistical and fulfillment issues are anticipated and planned for. There are four basic things that every entrepreneur needs to consider before setting up an e-commerce site.
- Turn Your Idea Into A Niche: Chances are that most great ideas have been thought about by others as well. Rather than attempt to enter a competitive or saturated market, it is a good idea to consider if the idea can be converted to serve a niche market. This makes it easier to differentiate and stand out from the crowd.
- Test Your Idea: Sometimes, before launching on a bigger scale with more inventory and setup costs, it is a good idea to do a test run. A good way of doing this is to setup a blog and try to generate traffic and interest. This will help gauge customer reaction and demand, as well as help through teething issues associated with selling a particular product.
- Understand Search Engine Optimization: For e-commerce sites, SEO can make the difference between high traffic and very few site visitors. A bulk of visitors to the site are driven through search engines and for this there needs to be an understanding and correct usage of SEO techniques and tactics. There is a right way of using SEO which will lead to interested and returning customers and a wrong way which will lead to search engine oblivion. A good SEO program should:
– Create content that is linkable
– Write guest posts for other relevant blogs to direct traffic to your site
– Become active in relevant forums to keep updated in your area as well as to get links from your posts.
- Research the Right Platform for Your Business: These days, most people can learn to setup their own shop without the help of developers or a lot of monetary investment. With some time and patience, the chosen system can be learned easily. There are many choices available however and the decision to place products for sale through one of these needs to be made very carefully. Migrating to a new one can be a difficult task so choosing the right one to begin with becomes extremely vital.
MISTAKES TO AVOID
Although it appears that online selling is now an established phenomenon, the business model is still in the process of refinement. Everything about an online store is not the same as that of a physical store and these differences need to be understood and addressed carefully. Some common mistakes made by e-commerce store owners include:
- Treating An Online Store The Same As A Physical Store: If an e-commerce site is an addition to a physical store, it is important to build this new store from the ground up and not merely make an attempt to replicate it as-is from the existing store. Often, popular items sold in store will be different from items that become popular online. There are also different methods and techniques to attract and retain customers and convert to sales.
- Not Giving Customer Service its Due Importance: Given the detached nature of an online store, it becomes absolutely necessary to create excellent, reliable and effective customer service to help customers out in case of a problem or a confusion. This allows the business to add a personal touch to the online operation.
- Remaining Anonymous: Rather than buy from a faceless store, customers who shop online often want to be able to see who is running the business. This personal story and a face allow the customers to relate to a store or its products and this in turn fosters loyalty and possibly return customers.
- Complicated Checkout Processes: Vital to the online experience is the shopping cart or checkout process. There needs to be an easy way for people to complete their purchase with multiple payment options and fewer steps.
- Confused Product Mix: Since there are seldom space constraints in an online store, a store owner may be tempted to offer a varied and complicated mix of products. Instead of focusing on too many things, it is a better idea to build value within a niche category.
- Lack of Strong Website Content: Though there may be a tendency to think that the product speaks for itself, this is a misconception. A well written product description may be what directs a customer to the website and what convinces them to actually buy. Every word counts and often it may be a good idea to hire a professional to develop sound, SEO strong content for the website.
- Stagnant Products or Content: Once a website has been developed, it needs constant attention and cannot be ignored. New items need to be added, out of stock things need to be removed and special holiday sales and promotions required to keep the content relevant. An accompanying blog that features related posts is a good way of keeping the website interesting and alive.
- Lack of Marketing: Beyond a good website and SEO, a site owner will need to focus on the right marketing and promotion tools to reach the right audience at the right time. This needs to be an ongoing activity because lots of traffic to the site will be meaningless unless it is the intended audience.
- Inefficient Delivery and Fulfillment: A key aspect of e-commerce is the fulfillment. It is not as simple as putting an item in a box and sending it on. Instead, every aspect from the packaging, insurance, mode of transport and delivery time need to be taken into account. Customers expect the shortest possible delivery times and reliable service and this process needs to be fine-tuned to avoid dissatisfied customers.
Common Small Business Mistakes
With small businesses, there is the possibility that the business owner is attempting to fill most of the roles themselves. In this case, there is often a chance for certain mistakes to be made. Some of these include:
- Poor Website Design: A business owner may not be well versed in website design and as a result a poorly designed website may mean a lack of sales and traffic.
- Lack of Contact Information: There is a tendency for small businesses to leave off contact information. This is a grave mistake and may put off many would-be customers.
- Lack of Metrics: There may be less time for a business owner to focus on metrics for their business and the website. This means that the owner will not be able to measure performance and understand customer needs and trends.
- Poor SEO: Often, search engine optimization may not be focused on as much as is needed. Or the website may not be update as regularly as needed to keep it relevant during searches.
- Lack of Social Media Linkage: In the current internet age, linking e-commerce sites to related social media presence is a vital component of the business model. Successful site owners build up a presence and personality through social media and use this to drive traffic to their stores.
- Lack of Mobile Optimization: Increasingly, a large number of people are using smartphones to log onto the internet. This is why it becomes necessary to ensure that the website is optimized for viewing on a handheld device such as a phone or a tablet.
- Lack of IT Support: A site owner may not be a tech savvy person and this means that when it comes to bugs, errors and security threats, the website may be vulnerable and exposed.
Website Design Mistakes
There are some common website design mistakes that many businesses make. These mistakes are not exclusive to small businesses but are often seen in bigger stores as well. Seemingly obvious, these mistakes can cost a business and cause lost revenue.
- Design Layout to Encourage Further Shopping: In a bricks-and-mortar store, there is significant cost associated with construction. As a result, there is more attention paid to layout and design than in an online store. This is a costly mistake. In a physical grocery store for example, there are small items placed at or near checkout that are often added to purchases ensuring that a customer buys more than they intended. The importance is store layout is highlighted by this aspect and can be remedied by understanding customer buying behavior and interests. Related items and ‘things you may like’ are a good way of achieving this.
- Complicated Checkout: It is, unfortunately, fairly common for online stores to make customers go through long and complicated steps to complete their order once items have been added to the cart. If a customer is showing a serious intent to purchase, the rest of the process should be as smooth as possible to make the experience painless and enjoyable. Multiple payment options are also necessary to facilitate customers.
- Required Registration: Relating to the checkout issue, online stores often force people to sign up for an account before they can complete their order. From a customer’s perspective, this is another complication in the way of order placement. The business should prioritize the customer and sale over recording customer information. A solution is to offer the customer an option to save their information to help other future purchases go smoothly and efficiently.
- Too Much Focus on Conversion Rates: Though an important indicator of success, businesses often make the mistake of overlooking wider implications for the financial health of the store in a bid to increase conversion rates. Average order value is another important metric that can help assess conversion rate and any attempt to tweak should result in optimization for both of these areas.
- Poorly Designed Site Search Function: Often, a customer may be after a specific item and would like to speed up the process by searching for it directly through a search bar. This is why a functioning search engine with filters is a necessary feature for a website. Along with filters, there should be options to refine and sort results according to criteria such as newest, priced low to high, priced high to low or popular items.
- Inadequate Images: Product images are a key characteristic of any online store. Since customers cannot experience the product, they need to be able to clearly see it in a well taken photo. They should also have the option of viewing from different angles, zooming in to specific areas and possibly see the item in use in photos.
- Incomplete Shipping Information: All shipping costs should be communicated to the customer at the time of purchase and checkout. There should be no hidden costs or costs to be communicated at a later time. If there is uncertainty, then a flat rate can be applied that covers any changes to the cost.
- Missing Store Policies: Any shipping policies, return and exchange policies or frequently asked questions should be mentioned clearly and in detail to avoid any confusion.