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Grow Your Business Sales & Marketing

E-Commerce Problems Your Business Needs to Address

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goc/Getty Images
  • Pay-per-click advertising isn't always cost-effective. Fraudulent clicks by bots or people don't translate into real sales.
  • A visual website optimizer can prevent checkout registration barriers and difficulty with the checkout process.
  • PayPal found that global customers are more likely to make a purchase when product descriptions and prices are in their native language and currency. 

E-commerce has changed how businesses operate today. It has given life to thousands of new businesses and a new revenue channel to existing businesses. 

While it may be easy to set up an e-commerce website (or add an e-commerce component to your business's existing website), issues regarding customer service, search engines, payment gateways, inventory management or order fulfillment are common and pose significant barriers to achieving and maintaining success. 

Consumers no longer need to travel to stores to make their purchases. This digital age has reshaped how businesses operate and provided multiple access points for consumers to buy what they need. 

Regardless of what you're selling, going digital can be a risky, yet lucrative business decision. This is especially true if you're selling hard goods, such as furniture, appliances, tools, electronics and jewelry. 

Businesses in these industries are likely to struggle to match the cost of goods sold until they sell enough of their inventory to break even. The cost of goods sold is how much it costs the retailer, manufacturer or distributor to produce their products. 

Based on recently released surveys and reports, here are additional common issues plaguing online retailers, and what they can do about them. 

Advertising strategy is a big differentiator in a space where many people sell the same products, according to Kevin Zhang, founder of Kreator eCommerce & Consulting. "It's a never-ending battle against everyone else in the space," Zhang told Business News Daily. 

Success in e-commerce comes down to two main factors: traffic and conversion. E-commerce websites need relevant traffic and need said traffic to convert (i.e., purchase), according to Andrew Scarborough, co-founder of PriceWaiter.

"On the traffic front, you must have relevant, unique content to get the attention of the search engine and to educate your shoppers," Scarborough said. "For conversion, your site must be mobile-friendly, as mobile traffic often surpasses desktop traffic for online stores." 

E-commerce business owners should curate a catalog of unique products that ensure a proper fit with your intended market. This will give your online store a competitive advantage and keep customers coming back. As the business grows, your focus switches to building a solid social community within the customer base to increase loyalty and improve retention rates. 

Despite the popularity of the pay-per-click (PPC) online advertising model, it's not always cost-effective for e-commerce businesses. Fraudulent clicks by people or bots don't translate into real sales (and then there's the money you've lost to the PPC marketer to advertise your products). 

One of the biggest obstacles e-commerce businesses face is the dreaded abandoned shopping cart. Visual Website Optimizer (VWO) estimates that 68% of online shoppers leave e-commerce sites without completing their intended purchases. 

Although a VWO report found that the most common reason consumers abandoned an online sale – 56% – was due to unexpected checkout costs, a variety of tech-related reasons also topped the list, including website navigation or loading issues, payment security concerns, and the overall length or difficulty of the checkout process. 

To recoup some of these abandoned purchases, VWO recommended removing barriers like checkout registration, complicated cart editing and giving customers the ability to save their carts for later. 

A key advantage of e-commerce over brick-and-mortar retail is the ability to easily expand your business's geographical borders. According to a PayPal report, U.S.-based small businesses could do a lot more to reach global online shoppers. 

American e-commerce merchants aren't tailoring the shopping experience to international consumers. Only 19% translate their website copy from English into other languages, and less than half list foreign currency options on their sites. Global customers are far more likely to make purchases when product descriptions and prices are available in their native language and currency, PayPal found. To reach international customers, choose a service that can translate your website copy into multiple languages and use an e-commerce platform that provides currency options for potential customers. [Read related article: Top E-Commerce Challenges Facing SMBs] 

An e-commerce business's livelihood can be at the mercy of payment processors and financial institutions. "I've had a situation where my banking partner shut down one of my accounts and withheld close to half a million dollars for 180 days – this almost put us out of business," Zhang said. "It happened because we grew too fast, and they wanted to conduct an audit of our business. When all your money is digital, it can be scary when things get in the way of you accessing that capital." 

When choosing a payment processor, make sure it supports your business type (and the products you sell); otherwise, you risk having your funds frozen or your account closed. Additionally, if you anticipate fast growth – which causes your processing volume to spike – you want to work with a full-service credit card processor and communicate with them regularly as your processing needs change. Spikes in volume or ticket size raise red flags for card processors, and they may put a hold on your money or your account until their concerns are resolved. 

Secure sockets layer (SSL) and its successor, transport layer security (TLS), are encryption-based internet security protocols developed to ensure privacy, data integrity and authentication in web communications. Anyone who attempts to intercept SSL or TLS-protected data will see a mix of illegible characters that's almost impossible to decrypt – unless you're a skilled hacker who has an SSL certificate decoder. 

E-commerce websites are exposed when the same passwords are used for many sites, which makes it easier for hackers to use stolen passwords from other sites to retrieve your data, according to Caleb Sylvest, partner and experience designer at Spacetime.

"SSL encryption isn't typically an issue anymore if you're using a big-name e-commerce platform like Shopify, because they provide SSL by default," said Sylvest. "But if a store does not have an SSL certificate, all site actions and purchases can be sniffed out by bad actors." 

Hackers can obtain unauthorized access to consumers' personal and payment information by running malware programs. If credit card fraud isn't a big enough scare, additional security issues such as man-in-the-middle attacks, bad bots, phishing scams and distributed denial of service (DDoS), can plague the online environment of your e-commerce website. 

Ask your e-commerce platform provider about the security protocols they have in place. Are they PCI compliant? What fraud-protection technology do they use? What do you need to do to ensure you're doing your part to protect your e-commerce website? [Read related article: E-Commerce Fraud: What Your SMB Needs to Know] 

Data breaches are becoming all too common in the modern world of retail, and if your business is hit by a data breach, it could have devastating effects. A report by Interactions found that 40% of shoppers avoid retailers that have been affected by security breaches, and 34% of shoppers will steer clear of online shopping due to fear of a breach. 

According to the report, nearly half of all shoppers believe retailers (online and brick and mortar) should invest in better technologies. Assure your customers that their data is safe with you by securing your website with HTTPS protocol, using an e-commerce platform that prioritizes data security, ensuring your e-commerce platform or shopping cart is PCI compliant, and requiring your customers to use robust passwords. [Read related article: How to Protect Your Customers From Data Breach Identity Theft]

Joshua Stowers

Joshua is a staff writer based in New York City. He is a former entrepreneur who started a fashion and art, print and digital publication called Elusive Magazine, serving as the features editor for several issues. Previously, he worked in product development for DirecTV and for a content agency writing for Verizon and Google. He is a New Jersey native in love with the city lights and skyscrapers.