The Emerging Challenges For E-commerce Startups In 2020 As people are getting to know about this industry, many are striving to carve a niche for themselves

By Ankush Mahajan

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The e-commerce industry is a fast-growing sector with demand going through the roof and more people adopting this stress-free method of shopping. In 2015, the e-commerce retail sales amounted to over $340 billion and by 2019 the total sales are projected to be double that amount. This means more people are getting to know about this industry and so much more are also striving to carve a niche for themselves by opening up online retail stores. The e-commerce industry as a newcomer is bound to face certain challenges ranging from economical to technological down to the social sphere.

Here are the four major challenges faced by start-ups in the ecommerce industry.

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Direct Competition with the Big Brands

The big brands are the first and one of the biggest challenges a newcomer will face in this business. Companies such as Walmart, Amazon and eBay, who are giants in the online retail sector will easily knock a start-up off the market. Statistics show that Amazon is doing better as each year passes, surpassing every other online retail store both in sales and popularity.

The solution to this particular problem will be to avoid direct competition with giants in the business, you are advised to choose a less competitive niche and grow your business one step at a time.

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Managing Shipping, Delivery and Returns

Newcomers or start-ups in the e-commerce industry face a lot of challenges when it comes to a seamless flow of transactions after orders have been placed and paid for, shipping charges, on-time delivery or return policies may pose a serious threat to your business. Most shoppers also complain about the quality of products they are supplied after payment has been made, to stay in business, companies will have to go out of their way to provide their customers with the best services there is.

There are different order fulfillment models attached to the shipping of products, thorough research has to be carried out, to ascertain which suits your business the most and maximizes productivity.

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Expensive Marketing and Advertisement

With the growing competition, digital marketing and advertising is getting expensive every day. Most start-ups made the mistake of spending their entire budget on website development and ignored the marketing aspect. Before you start, all your company expenses should be documented and properly verified to ensure its necessity; you also do not want to spend too much on your Web development. You can start with free e-commerce platforms such as Quick eSelling to save your budget. Along with regular digital marketing activities, you should also try out other means to keep your customers coming back, such as rewarding customers with points which can be redeemed and used on your company; discounts too will go a long way in ensuring you keep customers coming back.

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Staying Up To Date

The trendsetters are the big brands, they are the ones who bring up innovations, create new ideas, then smaller companies have to catch up, which most times is capital intensive or just way above their reach. A new company looking to withstand the test of time in the e-commerce industry will have to do all it takes to catch up and stay up to date with the latest technological advancements such as mobile applications, multi-channel selling and automation, among others.

One of the ways to tackle this challenge will be to team up with the right technologically advanced partners who share the same vision as your new start-up company and will work equally hard to keep you up to date.

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With all that's been said, we all agree that challenges are bound to confront newcomers and already established companies in the e-commerce industry, but how you manage to overcome these challenges, say a lot about your competency and readiness to take on and run a business that its profit runs in millions.

Also Read: 7 Tech Trends to Watch Out for In 2020

Ankush Mahajan

Digital marketer & e-commerce consultant at FATbit Technologies

Ankush works as a senior digital marketer and e-commerce consultant at FATbit Technologies, one of India’s leading custom web design/development & start-up friendly e-commerce solutions company. His expertise lies in branding and formulating marketing strategies for business of a number of industries. He has been active in online marketing services for past 5 years.

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