Top 10 Challenges E-commerce Platforms Are Facing Today
According to recent data, e-commerce spending is growing at a rapid pace and is expected to hit $5 trillion by 2020. However, with this great news come a lot of challenges. Let’s take a look at some of the challenges facing the e-commerce industry.
1. An Economy Without Borders
Mobile technology has given consumers power like never before. It has paved the way to a digital economy thus taking globalization to a whole new level. Traditional boundaries are crumbling with online retailers expanding to new geographic locations. Companies now have to deal with things such as geopolitical statuses, government regulations as well as local and international competition. This means that e-commerce businesses will need to provide the best services for their customers while finding new ways of balancing globalization and localization.
2. Build a Foundation on Trust and Brand
Consumer trust and brand loyalty is the key for any business to succeed, but the rules of a traditional brand building process simply do not apply to the e-commerce industry. “The next big thing” is always around the corner making it easy to lose customers. The same thing goes for failing to deliver on any customer demand. Instead of competing on pricing, brands will have to compete on brand recognition and customer experience.
3. Subpar Experience Due to Disparate Systems
There are many types of data management systems such as CRMs, Enterprise Resource Planning and Point of Sale. These systems have a wide range of architecture, usage and deployment which is most often built on outdated technology and ultimately leads to stagnation down the road. In terms of e-commerce, a good chunk of your resources will be spent on various systems conflicting with internal business demands and thus distracting you from core tasks such as improving your e-commerce website.
4. An Absence of Cross-departmental Collaboration
There are four key aspects that are challenging to manage when running an e-commerce business: data curation, technology, people management and product delivery. Collaboration between these departments can prove challenging since some of them can be in a geographically remote location or many time zones away. This means that merchandisers, marketers, e-commerce managers and software development team members need to operate strategically via a single integrated channel.
5. Technological Advancements and Ease of Usage
Nothing has empowered consumers more and increased global competition in the e-commerce industry like new technologies and easy to use e-commerce platforms. Omnichannel retailing is the future of e-commerce which places a lot of pressure on companies to tackle difficult issues connected with running an e-commerce website such as bandwidth and server issues, dynamic IP address, security issues and data privacy. Moreover, the transition from a multichannel business to an omnichannel one is a challenge within itself. A good example of a company that achieved such success is the hypermarket Auchan. As one of the largest networks of hypermarkets and megamarkets in Europe, they needed to meet the latest global trends in the retail industry, Auchan decided to actively develop its e-commerce direction. Currently, the site users have the functions of comparing products by characteristics, calculating the purchase of goods in case of credit purchase, an interactive catalog with current promotions. Customers can also segment the received mailing in their account by selecting only the topics they are interested in.
6. Finding and Selling the Right Products
With so much competition out there from companies such as Shopify and even greater giants in the industry like Amazon, it is difficult to choose a product that will give you a competitive advantage. Also consider that nowadays, thanks to advancements in technology, anyone can start their own online store. All of this makes it very difficult for retailers to find unique products to sell.
7. Attracting the Right Customers
The world of e-commerce has changed dramatically in the past five years and one of the major changes was how consumers search for products. Consumers nowadays use more than just Google to find products. They use Amazon, social media, they actually read the reviews left by other customers. This means that the first challenge for retailers is to find where their customers are and attract them without using up too many resources.
8. Obtaining Quality Leads
E-commerce sites are spending tons of money to drive traffic to their online store and conversion rates are only between 1 and 3 percent. The key is creating an e-mail subscriber list for long-term success This will enable you to get your message out there better and also to selects prospects better with tools such as Facebook Custom Audience. If you want to convert your audience into leads and then to customers, you must craft your message exactly right.
9. Nurturing Leads Properly
What’s the point of having a large e-mail list if you are not actively engaging with subscribers? Even though only a small percentage of that e-mail list will convert into customers, you must always deliver value with your e-mail marketing campaigns. Prospects need more than just promotions and communicating product offering. Put in some work to give them value and entertainment.
10. Retaining Your Customers
One of the golden rules in business is that attracting new customers is much more expensive than keeping your existing ones. Try to find ways how you can get the most out of the customers you already have in terms of increasing the lifetime customer value.
As we have seen from the list above, there are extensive and pressing challenges that come with running an e-commerce business and what could be even more challenging is finding people to make sure everything is running properly. It is simply not possible to achieve consistent online growth without finding, attracting and retaining top quality talent. You can find a software development team via outstaffing which can give your business the boost it needs.