13 Challenges of eCommerce and Ways to Address Them

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The eCommerce industry has come a long way since the internet was made available for commercial use in the early 1990s. eCommerce sales in the U.S. accounted for more than 187 billion dollars in revenue in just the fourth quarter of 2019. The number is expected to increase to around $476 billion in 2024. That is a significant increase from revenue of below $280 billion in 2017. However, while online sales continue to increase in numbers and volume, challenges of eCommerce keep getting more complex.

Addressing problems of ebusinesses is possible only after identifying them correctly. Besides, challenges in online businesses have changed significantly over the last couple of decades. For instance, driving traffic to an eCommerce website now takes much more than using the right keywords. In addition, the need to use a suitable product information management (PIM) software has never been more amplified.

Making Sense of Numbers

Here are numbers that should give you some indication of where online shoppers stand and what they want.

  • Around one-third of all consumers make online purchases weekly or more often.
  • Mobile eCommerce sales are estimated to account for over 70% of global eCommerce sales in 2021.
  • More than 90% consumers prefer shopping in their local currencies.
  • Around 75% consumers buy products through websites made available in their local languages.
  • Close to 80% smartphone owners have used their devices to make online purchases in the preceding six months.

Selling the Right Products

Many basic challenges to ecommerce that existed until a few years ago have been eliminated by the entry of prominent online shopping platforms such as Shopify and WooCommerce. These platforms have made entry into the sphere simpler, and they also provide a variety of tools for sellers. However, finding the right products is sell is still a crucial starting point.

While there is no dearth of online sellers selling just about everything one can imagine, finding your own space is possible if you:

  • Work on solving a customer pain point.
  • Select products based on your own passion.
  • Make use of your professional experience.
  • Identify and capitalize on latest trends.
  • Check customer reviews for ideas.

Managing Product Information

Cost-effectively managing product-related data is among the top challenges of eCommerce businesses. Fortunately, this problem is rather simple to fix. All you need to do is select suitable product information management (PIM) software. With good PIM software in place, you can look forward to various benefits, which include:

  • Collecting data from multiple sources and combining it to generate reports.
  • Identifying and fixing data-related problems.
  • Sending required data through multiple channels of distribution.
  • Creating and managing multiple product categories.
  • Effective filtering of products during searches carried out by consumers.
  • Business process management and catalog management software integration.

Verifying Identity

One of the key challenges facing the eCommerce industry as of now is online identity verification. For instance, how do you know if someone browsing your eCommerce website is genuinely interested in making a purchase? Has the person even entered a real name and contact details? You can get answers to these questions only if you use some kind of an online identity verification system.

You get numerous options when looking for online identity verification software, which makes it important to select one based on your needs. For example, verifying identity of consumers remotely by using images and selfies is suited only for low-risk operations, given that the method is not very reliable or secure.

Good identity verification software should include features such as:

  • Electronic identity verification
  • Social Security Number (SSN) verification
  • Instant authentication
  • Multi-layered authentication
  • Sending automated verification links
  • Making automated calls to verify cash-on-delivery purchases

Dealing With Competition

Several marketing experts feel that the biggest challenge for online businesses comes in the form of competition. Given that just about every business that is trying to provide its mettle has an online presence, this cannot be far from the truth.  As a result, businesses in the online world have to make sure they provide great products and services coupled with competitive pricing, while paying due attention to branding.

Small and mid-sized businesses may work around the price competition aspect by offering clearly laid out value propositions that their customers cannot find elsewhere. Distinguishing your business from its competition is vital, especially if you hope to attract new customers. Fortunately, you can do this by having a well-optimized user-friendly website created to suit modern-day search engine algorithms. Businesses that are starting out in the online world may also benefit by providing unique products and focusing on smaller demographics.

While competition comes from other online sellers, you also need to worry about direct-to-consumer (D2C) retailers. This is because the age of eCommerce has given manufacturers easy means to reach out to their customers directly.  Recent research has shown that using PIM systems can help online sellers reduce their time to market by as much as 400%, and this gives online sellers one way to remain competitive with D2C retailers. Integrating artificial intelligence (AI) into the supply chain can also give eCommerce players a way to hold their own against D2C sellers.

Increasing Visibility

One of the basic challenges to eCommerce in today’s world is visibility. While you might have a great eCommerce website or an online store, it would serve no purpose if it does not attract probable customers. Consider this – if you business does not show up in the first two pages of Google’s search results, the chances of customers finding your online store remain slim.

An easy way to get by this eCommerce challenge is to invest some time and money in search engine optimization (SEO). This would involve carrying out keyword research, devising and implementing on-page SEO strategies, as well as building high-authority links. Doing this in the right manner results in increased online visibility as well as a higher percentage of qualified leads.

Depending on the type of products or services you offer, you may consider increasing your brand’s visibility by turning to social media platforms, using paid advertisements, or employing the services of influencers. Determining which mediums might work well for your business requires that you identify your core target audience first.

Identifying the Right Market

Finding the right market fit is important for any businesses, and this applies to eCommerce businesses as well. Product market fit refers to how well any product or service meets a market’s demand. A simple way to find this fit is to come up with a product that solves an existing problem.

Building Customer Loyalty

The fact that it takes around five times more money to attract new customers when compared with retaining existing ones is well known in the world of digital marketing. However, several businesses still continue to spend more money in trying to attract new customers, as opposed to building loyalty among their existing customers.

Since you cannot expect face-to-face interactions with your online customers, building trust and loyalty requires that you put in the required time and effort.  Some tips that can help include:

  • Make the entire process seamless – from browsing, to purchasing, to shipping.
  • Offer complete transparency in pricing.
  • Provide contact details.
  • Provide support via live chat.
  • Make use of loyalty programs.
  • Increase credibility by providing relevant and informative blog posts.

If you are unsure about your target audience, start by assuming that it spreads across a reasonably broad category. Then, run ads on platforms such as Facebook and Instagram to target this audience. Once you have adequate data, try to understand all that you can about consumers who interacted with your business as well as ones who went on to make purchases. After you get more information about your products’ market fit, you can narrow down on the best ways to reach out to potential customers.

Providing a Multichannel Experience

Data suggests that multichannel consumers spend up to three times more money than shoppers who use single channels. When addressing the challenges of eCommerce, businesses need to understand that consumers are spread across various channels. These include eCommerce stores, social networking websites, public forums, and live chat platforms. Fortunately, online sellers can adopt different multichannel strategies to reach out to their existing and potential customers.

First, you need to identify the online channels that your target audience uses the most. Then, you need to provide optimized content, personalized messaging, and one-on-one interactions.  It is important that you remain consistent in your efforts. You should also be able to direct conversations based on context, even if it means going through conversation histories.

Addressing Cybersecurity

Businesses that wish to enter the eCommerce space need to have proper policies that enable them to create secure frameworks. Formulating suitable response plans to deal with cyber attacks is crucial. If a business website in at the receiving end of a cyber attack, a contingency plan should be in place to address any possible downtime it faces in operations or sales.

As a small or mid-sized business owner, you can stay on top of cybersecurity threats by:

  • Managing your own servers
  • Backing data up regularly
  • Updating you eCommerce software regularly
  • Installing safety plugins and other safety-related components

Dealing With Abandoned Shopping Carts

Abandoned shopping carts are all too common an eCommerce challenge, and one that is faced by just about every online seller. According to statistics, close to 70% of online shoppers abandon their carts at some stage. The number can be as high as 90% for some eCommerce stores.

Dealing with this challenge of eCommerce requires that you:

  • Remove all bugs.
  • Ensure that customers don’t have to fill long and tedious forms.
  • Engage with customers during the buying process by providing live chat.
  • Make your website optimized for use with mobile devices.
  • Send automated reminders about abandoned carts via email.
  • Use behavioral retargeting to reach out to probable customers based on their previous actions.

Handling Returns and Refunds

A significant number of online shoppers pay close attention to return policies before making purchases. In addition, an inconvenient or lengthy return policy can act as a deterrent for several buyers.  One of the problems of ebusinesses is giving their customers easy means to carry out returns, while not suffering significant losses – monetarily or in terms of reputation.

It is important for online sellers to offer complete transparency surrounding return and refund policies. Providing multiple options when it comes to shipping and refund methods tends to put consumers’ mind at ease. By addressing this aspect in the right manner, you can also work in building customer loyalty.

Keeping Up With Evolving Technology

Given the number of people who use mobile devices for shopping, it is imperative that you have a completely responsive website. A number of prominent online retailers such as LEGO and IKEA have started using augmented reality (AR) with the aim of providing better visualization of products, and more businesses are bound to follow suit.

eCommerce is already moving beyond desktop and mobile devices, and into the quickly growing Internet of Things (IoT) space. Form smart speakers, to smart cars, to smart homes, consumers will soon have multiple options from where they may use voice searches to make purchases. As a result, retailers will have way more touch-points to explore.

We design and develop effective, user-friendly and secure e-commerce websites. Whether you want to sell one product or thousands, require payment integration or a custom designed web store, we have the technical expertise and online marketing experience to make sure you get the e-commerce website to suit your needs. Our e-commerce websites are easy to navigate and conversion-oriented. We also make them look good because, in e-commerce, first impressions matter. Read more about eCommerce development services – Top e-Commerce developers in Kenya.