9 out of 10 entrepreneurship ventures fail even before taking off. Isn’t that such a bad thing. But, why do businesses fail? With all the technology, social networks, few market entry barriers and increasing business possibilities opening up, why do entrepreneurship ventures fail so easily?
The fail rate is not specific just to one industry. It is everywhere. However, it is most evident in the eCommerce industry where the fail rate is estimated to be around 80%. Perhaps all these businesses need is a push in the right direction before they begin spiraling downwards.
Here is how e-commerce entrepreneurial ventures can stay in the game and emerge as victors instead of falling victims to failure.
Launch is Just the Beginning
Beginning an e-commerce store is just a scratch on the surface. The real challenge is in making it a preferred destination for shopping, be it for clothing, cosmetics, purses, gadgets or anything else.
To gain a debutant advantage, consider rolling out free trials, samples, and referral programs. In the recent past, Amazon managed to sell its app user base by rolling out a referral program that encouraged existing users to use the mobile app.
Don’t be Startled by Cart Abandonment Rates
In the e-commerce industry, cart abandonment is a daily norm. The typical cart abandonment rate for e-commerce is estimated to be in the bandwidth of 68% to as high as 80%.
So if your carts get abandoned increasingly, don’t be alarmed. Instead, find out the reasons why it happens. Some common reasons include:
- Presenting unexpected shipping costs at the time of checkout
- Payment security concerns
- Lack of a guest option to make a quick purchase
- Long or complicated checkout process
- Unavailability of preferred payment mode
Tick off these customer turnoffs from your online store and see how your cart abandonment rates plummet and conversion rates improve.
Competition is Fierce. Get Used to It
The e-commerce industry is not just competitive, it is hyper competitive. For every single product you have on offer, there are endless other online stores ready to offer it for a discounted price.
How does one crush competition in such a scenario without fading out?
Observe and analyze your rivals to spot areas where they are lagging. Improve your packing and delivery to provide a superior experience that will build long-term customer loyalty. Offer promo codes and incentives to sustain customer base and to prevent them from being diluted by competition.
Traffic is not Turnover
Thanks to SEO, digital marketing and paid ads, it is easy to bring traffic to your online store. However, in the end all that matters is how many people buy and convert into actual sales. Traffic is just visitors, buyers are the real revenue.
Hence, your focus should be on creating high-quality leads which will end in a complete customer journey with the cash flowing into your account in the end.
Word of mouth is still existent (& going strong)
According to a study by BrightLocal, more than 80% of customer believe online reviews and ratings as much as they trust the opinions and suggestions of their near and dear. Online reviews and ratings are the modern day's word-of-mouth marketing. Get it right and you are half saved from the trouble of proving your brand value.
Security is Paramount
Do you know? The chances of your credit card information being stolen online are more than you being robbed while taking a stroll on the street? e-commerce is infamous for cyber security. And for your customers, it is a huge demotivator to shop online.
How to Overcome Security Concerns?
Show that you are authorized. There are trust seals, authorized dealer badges, and certificates which can be displayed on the website to showcase your business authenticity.
Secure payment gateways with encryption and two-factor authentication that give total control to customers for their payments.
Most importantly, provide them with all possible payment modes allowing them to choose one of their preferred choices.
“For e-commerce, the most important thing is trust.” quipped Jack Ma, Founder of Alibaba, the e-commerce giant in a press conference. And he’s completely true about that statement.
Think of these e-commerce brands: Amazon, eBay, Zappos. What is the first thing that strikes your mind? Customer stories of how these brands walked the extra mile to restore customer trust.
Customer trust is such a vital ingredient to e-commerce success. By winning their trust your store also wins their loyalty, which in turn becomes a solid source of repeat orders for your store.
Entrepreneurship is a test of perseverance. Only those who withstand the pressures of competition and upscale customer service can succeed in it.
Has your online store been showing signs of weakness? Maybe it is time to do a reality check and put few things as detailed above in order to restore its real form.