8 Major E-Commerce Challenges Online Entrepreneur Startups Should Know

Getting into e-commerce seems irresistible for most businesses. There is tremendous upside potential for taking to the Internet, and with the proven stability and performance of thousands of online companies, most entrepreneurs can’t wait to get on board.

But numerous e-commerce challenges await the newcomers, many of whom may be in for a rude awakening. Hopeful owners of online startups, especially small-medium businesses (SMBs), need to take careful preparations before taking their business online. Familiarize yourself with the challenges outlined below to learn how to deal with them.

  1. Market niching necessity due to competition
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This means not only understanding the competition but also how to improve upon what they do. You might have a great idea, but there may be hundreds of others who have already come up with—and even developed—the same concept before you.

To get started in market niching, break down your idea into something with a more specific focus. This reduces the number of competitors to a mere handful of businesses with whom you have more in common. Now it becomes much easier to analyze the market from and strategize your approach.

  1. Lack of shopping interaction
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Online shopping’s greatest feature can also be its most crippling challenge. Experiencing a product or service in person can make or break a sale, and this experience is lost on the customer when you take your store online.

To make the shopping experience more immersive, make sure that your website features as much descriptive info and imagery as possible. This may include product reviews, sizing charts, and even SKUs and other specific details. Your customer support after the sale must be very strong and organized, so that your shoppers are confident in their decision to shop with you.

  1. Cross-Channel Customer Engagement and Personalization of Experience
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Savvy consumers have a lot of research tools at their disposal to buy the things they need, from retail stores, mobile stores, and telephone sales. Get to know how showrooming and webrooming work, especially among your target market.

The key to overcoming these challenges facing e-commerce is not in allowing the different channels to cannibalize each other, or even integrating elements of one channel into another. According to John Matthews, CIO, Extrahop, the solution is to create a “wholly better shopping experience by leveraging multiple channels.”

If you already have brick-and-mortar store and an online store, let them work together to help your customers. Let the customers decide which platform is most comfortable and convenient for them. Either way, you win.

  1. Demanding efforts for community building
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Trends come and go. They are hard to predict, and their value is even more difficult to assess. Chasing new trends may be a waste of time and resources better spent focusing on real productivity.

Fostering a sense of community is far more valuable than chasing trends, hands down. Much like a neighborhood store, your e-commerce site should interact with your clientele, allowing them to connect with your store on social media. This interaction allows users to promote your brand and share their experiences with others, helping you build credibility and identity.

  1. Website concerns on design, speed, usability
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The appearance of your website matters a lot and should reflect your brand identity design, and make it easy for your customers to engage in the shopping experience with you. UI and UX are very important elements, which can contribute to, or detract from the experience, so make sure that your site is one that your retail customers would want to check out.

Among the challenges of e-commerce newcomers, understanding how the online shopping process flows from start to finish can mean the difference between conversion and abandonment. Spend some time making sure that form and function are seamless.

Your site should be built for speed. Under the hood, the engine should run smoothly. Performance and speed go hand-in-hand. Sloppy code, clumsy implementation of assets, and outdated plugins all contribute to a slow website, which can paralyze your company. Every second of loading time counts, so make sure to speed things along.

  1. Hiring the right people
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Assembling your supporting cast is no small feat, especially if you have strict budget guidelines to follow. It takes a tremendous amount of resources and risk on your end to run a business and build a strong team.

As with anything of value, you get what you pay for. Create a strong nucleus around whom to build your company. Finding people with the right combination of skill and work ethic, valuing their efforts and paying them commensurately is key to your growth and success.

  1. Fraud and cyber-risk
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Unfortunately, consumer fraud is something that is more commonplace than you might imagine. How does it work? A malicious customer makes an online purchase, wait until it is shipped, and then report the transaction to their bank as fraudulent. The banks side with the customer, and small businesses chalk up these cases as a loss rather than pursuing a costly consumer fraud case.

On the other hand, well-meaning consumers can fall victim to malware, which is all over the Internet. Customers’ bank account, passwords, and credit card information can be easily stolen if you, the merchant, do not implement the appropriate security measures.

Consider implementing consumer authentication, as well as well-established payment platforms. Be aware of how these layers of security may be discouraging to the customer, and be prepared to entertain questions about your security methods.

  1. Taxes
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As a new online entrepreneur, you may be unaware of how to properly collect and remit sales taxes at the local, county, and state levels. Be sure to educate yourself on the tax laws, or consult with a qualified tax lawyer for help.

E-commerce is a brave new world for many brick-and-mortar retailers, but if you exercise due diligence, the rewards far outweigh the risks. Are you ready to face these challenges head on? Let us know by leaving a comment below.

vincent sevilla

Vincent Sevilla is a professional web designer for Websitesetup, and he also has a background in online marketing. Vincent has written on Metapress, Designerfx, and Techwyze. You can follow him on Twitter

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