The Top 5 Errors Made by Money-Losing Ecommerce Sites

Success is never guaranteed in online marketing but avoiding these common errors makes it much likelier.

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By Brett Relander

Opinions expressed by Entrepreneur contributors are their own.

Setting up an ecommerce site is easy. There are ecommerce solutions that can create a snazzy store for you in minutes. However, running an ecommerce business is a totally different ball game. Attracting traffic and generating revenue in the face of fierce competition is hard but businesses that avoid these basic missteps can gain traction and make excellent profits.

1. Making things difficult for the customer. This includes almost everything that you can do to turn customers away. It begins with a site design that is not intuitive and results in tedious navigation. In today's market, this includes not having a mobile optimized website.

Not enough payment options and a cumbersome purchase process result in customers leaving empty-handed even though they were on the cusp of completing a purchase. Add low-quality images and poor product descriptions to the mix and you have put together a potent combination that will definitely prevent your ecommerce business from taking off.

Related: How to Fix 3 Common Online Marketing Mistakes

2. Not targeting customers. Customer acquisition is one of the biggest costs that ecommerce sites incur. Businesses without a system for targeting specific customer personas, as well as marketing to existing customers, spend excessively targeting the wrong audience. Even though first-time visitors drive 73 percent of online conversions, these are less profitable because of the higher cost of customer acquisition. To effectively target customers, capture your customer's information. Then you can market at a lower cost in a more personalized manner.

3. Low profit margins. Rookie ecommerce sites do business at a loss until they achieve economies of scale. If and when they do make money, inventory, payment gateway fees, shipping, advertising, staff and technology nibble away at profit margins. Incentives are a great way to build a customer base but only when the financials are analyzed accurately. Customers are always on the lookout for discounts. Providing deals, contests, giveaways, etc., is a great way to build your database and expose your brand to more potential customers.

Related: 5 Deadly Sins of SEO and Online Marketing

4. Not marketing your business effectively. Marketing an ecommerce company requires savvy search engine marketing, social media marketing and content that fulfills the latest search engine optimization requirements.

These activities are intensely data driven and require funds for advertising. Analytics plays an important role in just about every activity of an ecommerce site. The choice of products, customers to target, platforms to advertise on and even the choice of vendors is influenced by data.

To fully optimize your sales funnel and maximize profits, take the time to fully understand your on-site analytics as well as the data you're capturing from marketing channels, social media and search engines.

5. Annoying your customers with hidden costs. Customer pet peeves include hidden costs that pop up at the time of payment, lax security at the payment gateways, compulsory registration to make a purchase and, of course, selling poor quality goods. An ecommerce business must eliminate these. At the back-end of the business, focus on vendor management, logistics and distribution tie-ups for a smooth customer experience at a low cost.

Related: 8 Ways to Screw Up Your Marketing

Brett Relander

Managing Director at X1 Sports Nutrition

Brett Relander is founder and managing director of X1 Sports Nutrition ( He has a degree in exercise science, is certified as a Master Fitness Specialist and in the biomechanics of resistance training, and is an advocate of all-natural nutrition and advanced performance training.

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