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Top 10 eCommerce Challenges and Easy Ways to Overcome Them

An eCommerce store is the primary retail growth engine for any business. In fact, eCommerce is expected to claim 17% of the industry by the end of 2022. The meteoric growth witnessed by digital commerce over the last decade has also given rise to several eCommerce challenges. With the increasing size and demand for online business, riding the digital commerce wave is not easy.

A demanding majority of shoppers (nearly 81%) begin their journey with online research. Further, 71% of the customers say that a fast and highly responsive online marketplace is essential for a pleasant shopping experience.

The Total Transaction Value (TTV) in the digital commerce segment was reported to have a worth of $3.7 million USD in 2020, and this value is expected to rise to, $4.5 million USD by 2023. In order, to achieve a competitive edge in this crowded marketplace, leaders must first address the core challenges facing eCommerce businesses.

eCommerce Challenges Faced by Businesses

Leaders across the globe face many eCommerce problems while adapting to the digital commerce business. Here are the ten most common eCommerce challenges and solutions while working towards building successful eCommerce platforms.

1. Capitalization of Data

The expansion and integration of the digital commerce function into the core, holistic brand solution is one of the crucial eCommerce challenges. Quite often, eCommerce becomes an autonomous side business rather than a fully integrated part of the business as a whole.

To facilitate this union, businesses are working hard towards building eCommerce solutions that are data enabled. This will help businesses with shipping to store management and, omnichannel solutions like BOPIS. Fully leveraging the data from digital commerce functions will also help measure, Key Performance Integrals (KPIs) beyond conversion rates and Average Order Values (AOV).

Rather than experimenting based on assumed market trends, data need to be systematically captured and applied in innovative ways. Entrepreneurs need to acknowledge the impact of data on the day-to-day as well as long term business decisions.

Solution

Retail businesses should start by making the eCommerce function an integral part of the business rather than a separate segment of a brand solution. They should find smart ways to capture and measure data related to in-store shopping and customer loyalty. This will help them in the data visualization, targeting the customers more effectively, making a cross-digital impact, and improving monetization methods in local stores.

Improve Your eCommerce UX: The 20 Point Essential Checklist

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2. Customers’ Exploding Expectations

ecommerce challenge customers exploding expectations

Retailers all over the world are continuously trying to build their reputation and a sharp brand image with the promise of a great experience. In an era where experience matters the most and tech giants like Amazon are taking the online buying process to the proverbial ‘next level’ with anticipatory shipping methods, it is very difficult to meet customer expectations. Thus, competing with them and fulfilling the ever-evolving customer demands is a huge challenge for retailers today.

Solution

86% of buyers are more likely to pay extra money for a better experience with a hulking 89% starting their own business and turning into competitors as a result of a poor experience.

To meet the customer expectation of good user experience, brands should start analyzing their eCommerce trends and must focus on using this data to come up with personalized customer experiences. The customers must feel acknowledged and valued right from the moment they start using your service. To facilitate this type of customer connection, send them notification alerts or product updates for the same.

3. Agility Challenge

ecommerce agility challenge

Agility is the capability of a business to accomplish tasks such as introducing advancements, developing and deploying digital content, and reacting to seasonal changes rapidly. Agility drives immediate digital fulfillment, and it is identified as one of the most important initiatives in eCommerce businesses. Agile transformation is at the heart of digital business, and scaling is essential for making it successful.

A large number of companies find it difficult to move or change quickly to adapt to the needs of customers. This is usually because they cannot integrate new technologies efficiently with their existing system, and, as a result of which, penetration into the market gets more difficult.

Solution

Being agile in the eCommerce approach helps a business deliver an enhanced shopping experience. To be agile, eCommerce businesses need to incorporate quick changes across all platforms and must create personalized collections that inspire consumers. They should keep putting out fresh content and this content must be designed separately for all devices and media channels alongside with guided selling experiences.

4. Personalization Approach

digital commerce personalization challenge

There is no denying that personalization is the key factor responsible for a good customer experience. Retailers are obsessed with providing their customers with a personalized experience however, these experiences can become over-personalized without them noticing it. At this point, customers can get irked by the excessive amount of targeted online ads.

In this hustle, retailers miss out on developing a one-to-one relationship with the customers. This turns into a major challenge for the business to ensure that the customer feels valued as an individual. 84% of customers report that being treated like a person rather than just a number that contributes to a company winning their business is integral to their customer experience.

Solution

eCommerce business leaders must focus on developing the 1:1 relationship with their customers. They need to strengthen their tools and capabilities for better reach and visibility amongst the consumers. Retailers should use additional customer data strategically to better understand individual customer behavior and curate personalized customer experience.

Google Using Personalization to Help Users Spend Less Time Managing their Schedule | Ecommerce Challenges

This can be made possible with the integration of the latest technologies and smart algorithms into the current framework to help automate the entire customer journey. Additional commerce tools, a new machine learning approach, and cross-application data sharing can also be harnessed to serve this purpose.

5. Being Consistent

e-commerce challenges being consistent

Consistency is the most critical element while building a successful omnichannel strategy. Customers use multiple platforms to search for items before making a decision which requires businesses to provide seamless purchasing encounters through every product or service they offer.

However, analyzing and understanding customer interactions across all touchpoints and using it to build consistent and seamless customer experience is one of the major eCommerce challenges for retailers.

Solution

Brands can optimize their online platforms to deliver complete consistency between search options, various shopping pages, and shipping details. This will help them make the shopping experience seamless for the shoppers. They should work on product quality, fulfillment, and distribution as well.

Improve Your eCommerce UX: The 20 Point Essential Checklist

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6. Facing Competition

facing ecommerce competition challenge

The internet offers everyone an equal platform and hence an equal opportunity. This makes the environment extremely competitive, with possibly hundreds of other businesses offering the same products or services to the same target audience. Even the most niche brands have to fight hard to carve a place for themselves. Every segment in the eCommerce space is set to get increasingly congested and competitive over the years.

A homegrown startup has to keep pace with a multinational giant and vice-versa. Enterprise is continuously experimenting to come up with an innovative eCommerce business solution to gain an edge.

Solution

This challenge can be mitigated through thorough research and competitive analyses. It is important to categorize the competitors and frequently observe and assess the components of their websites. Characteristics to watch closely are pricing, the website design, products on display, and even the marketing tools and techniques they use. There is ample to learn from the strengths as well as the weaknesses of the competition.

By closely researching successful social media accounts, blogs, websites, and email campaigns, businesses can gain a more insightful understanding of the eCommerce landscape. Analyzing the competition can guide a business in its strategy and help them decide which direction to take.

7. Data Security

ecommerce data security challenge

The uptake of eCommerce raises concerns about security threats. This is one of the most critical eCommerce challenges. There is a looming threat of hackers and fraudsters attacking the host server and not just stealing confidential data but also introducing viruses.

Breach of credit and debit card details has become common news, and such lapses directly affect the trust of a consumer. Phishing is yet another threat where hackers pose as business and ask for sensitive information from their customers. Several users are increasingly concerned about the eCommerce websites’ capability to effectively shield their personal identity as well as the security of the transaction details.

Solution

A security first approach has to be a priority for every business operating in the digital space to retain the reputation of the brand and attract frequent customers. Some steps to safeguard the data of the business and its customers include switching to HTTPS protocols, using credible third party payment processing systems, and obtaining a Payment Card Industry Data Security Standard (PCI DSS) accreditation. Firewall software and plugins that shelter from SQL injections and cross-site scripting are also effective solutions for evading suspicious networks while allowing reliable traffic onto the website.

8. Technology Partnerships

ecommerce challenges technology partnerships

Technological partnerships are becoming increasingly popular in the eCommerce domain. When businesses join hands with a company to bring their idea to life, there is a lot at stake. The end product can turn out to be a success by both focusing on the tech or processes and also giving precedence to trust, transparency, and communication between the partners.

There are obvious risks to this approach. Many businesses gravitate towards choosing a partner based on costs without setting the right expectations or understanding their work scope. These gaps lead to a disastrous collaboration and eventually, a disastrous end product. With access to an enormous pool of talent and technology, outsourcing in itself can prove to be extremely beneficial if done right.

Solution

With platforms such as Clutch that offer detailed client reviews of software development companies across the globe, it is relatively simpler to find the right outsourcing partner for an eCommerce business. Business leaders should thoroughly research the company’s past work and expertise to determine if they are a good collaborative fit. Discussing project expectations, understanding their past work experience, and ensuring that the eCommerce web development company is aligned to offering modern-day solutions such as agility and digital transformation helps make the right choice.

9. Customer Retention

ecommerce customer retention challenge

Even some of the biggest players in the eCommerce segment struggle to retain their customer base. The reason for customer centric eCommerce challenges can be attributed to many factors such as the evolving expectation of the consumer, the presence of several similar options, failure to provide a pleasant shopping experience, and sometimes the offers and discounts being more substantial on the other platforms.

Customer loyalty is indeed a determining aspect in a business’s success, and even a minor glitch from the retailer can entirely ruin the brand reputation for a consumer. Many businesses fail to understand that trying to retain a user is about investing in building a steady and rewarding relationship with them over time and employing every channel of communication to materialize this relationship.

Solution

Building relationships takes time and effort. Businesses ought to engage their customers in different ways beyond the transactional correspondence to make them feel valued. Even while endeavoring to offer superior experience on the website, brands must nurture their customers by focusing on personalized communication. It is important to remember that loyalty stems from an emotional bonding with the brand, and every business should align their marketing effort towards building that bond. A smart customer retention strategy can work wonders for a brand where its consumers turn into brand advocates and help further spread the brand reach.

10. Relevant Leads

ecommerce challenges relevant leads

For eCommerce businesses, drawing good traffic may be achievable through promotions and other marketing efforts, but getting the relevant leads remains a huge challenge. It is no wonder that the average eCommerce conversion rates are often minimal. In fact, it has been reported that only 2.57% of eCommerce website visits have been converted into purchases in the US. The efforts invested in converting the visitor into a user can be futile if the right audience is not accessing the website. Unfortunately, it is common that brands fail to communicate the right message about their product or service and hence are unable to engage the interested audience.

Solution

A strong Search Engine Optimization (SEO) strategy in place can help pages rank and reach the potential customers who are actively searching for specific products. Additionally, running Pay Per Click (PPC) advertisements on Google Ads can also communicate the right information about the brand to draw the audience who has a clear intent or interest. For marketers it has to be a continuous process of follow-ups. Email marketing can be effectively used here through automated campaigns and personalized emails to connect with those visitors who may be potential leads over time.

Challenges of eCommerce Business – Final Thoughts

To overcome these eCommerce challenges, businesses should operate as modern omnichannel retailers. They should focus on turning data into insights, knowledge, and guidance for market leadership. Inspiring shoppers and driving loyalty with personalization at scale can work in their favor and can help support their brand, business model, and international expansion.

In this highly competitive world, entrepreneurs need to use smart digital retail practices to address the eCommerce challenges facing online businesses with the right set of tools. Finally, all of this must be backed up by strong digital leadership, providing clarity and support with the right resources to help a business become a market leader.

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