8 Ecommerce Business Challenges and Solutions

a person packing a product in a cardboard box

The size of the ecommerce market is expected to grow by leaps and bounds by 2025, reaching a value of around $10.87 trillion. While the growth opportunities are endless, ecommerce businesses have to face many challenges. Let’s take a look at how businesses can overcome some of the biggest ecommerce issues in today’s market and grow their operations. 

#1: Product Returns and Refunds

Returns and refunds can be a major challenge for any ecommerce business, particularly for those that are just getting their feet on the ground. Not only do they harm your bottom line, but they’re also a logistical nuisance. Consistently high return rates can cause serious supply chain issues down the line. This includes conflicts with your payment processors, suppliers, and even the ecommerce platform you’re using.

While returns are an inevitable part of running a business, there are certain things that you can do to reduce return rates. 

  • Generous Returns: Having a generous returns policy is beneficial both for the customer and the business. Reports indicate that 79% of customers will refuse to buy from a store that doesn’t offer free returns, while 72% expect to have their money credited back to them within 5 days.

Being smart about how you manage your returns policy can turn an ecommerce issue into an opportunity. Letting your prospective customers know that they’ll be able to return anything they don’t like, no questions asked, will increase your conversion rate. Healthy return policies are particularly beneficial for smaller ecommerce businesses because they encourage customers to experiment and try out new items.

  • Transparency: Running into hidden costs and confusion over your business’ policies can spur customers to cancel and ask for refunds. Make sure information regarding pricing, returns, and shipping is available upfront for customers before they make a purchase. Taking a transparent approach will promote a longstanding relationship between them and your business.
  • Setting Expectations: Ecommerce makes it easier than ever for customers to return products and leave negative reviews. Deceptive marketing won’t get you very far, and it will likely have lasting repercussions for your reputation. Be straightforward about your products and their benefits for the customer, as well as the kind of experience they can expect. 

#2: Abandoned Carts

Abandoned carts constantly challenge ecommerce businesses to improve their sales techniques. It’s expected that not everyone who adds an item to their cart will end up paying for it, but a rise in this metric can be a telling indicator for businesses. Businesses that lack an effective system in place for handling this ecommerce issue will keep seeing high rates of abandonment. 

About 60.7% of all shopping carts fail to make it to the checkout page. It’s easy to get discouraged by this high percentage out of context, but there’s a lot you can do to get it under control.

Optimize Outreach

Establishing a direct line of connection with your customer can encourage them to move forward with a purchase. To start with, having a live chat service available on the same page to assist visitors will indicate that they can expect a high level of service if they checkout. For businesses that might not have the capital to offer an around-the-clock chat service, there are many AI-based platforms that can automate responses to popular questions.

The second component of outreach can be a little more challenging for ecommerce businesses. You should set up an active communication system that gives your customers a reason to come back. A common example of this is when ecommerce businesses issue coupons and discount offers via email to customers who abandoned their carts. Alternatively, using WhatsApp and other social media apps to reach out can also be effective.

a check out button with an EMI offer

Revamping Checkout

A big reason many potential customers fail to complete checkouts involves poor execution. Challenges like website bugs and slowly loading pages will quickly discourage ecommerce customers.

Design your checkout process to actively help visitors complete their purchase rather than hinder it. This includes optimizing your website for mobile users — an increasingly popular platform — as well as performing extensive bug testing to ensure everything works as it should. Small tweaks like these can bring huge dividends in the form of higher conversion rates.

#3: Inconsistent Traffic

You can’t convert customers without maintaining consistent traffic. Traffic issues can be of two kinds:

  1. Not enough traffic
  2. Poor quality of Traffic

They sound similar enough, but there’s a world of difference between the two, and the way ecommerce businesses approach this challenge will vary, too. 

Not Enough Traffic

Poor overall traffic is a symptom of inefficient marketing, an issue that can plague even the best ecommerce products. High-quality products don’t guarantee that your brand will be able to get its name out there. Work up a solid marketing plan that incorporates SEO-friendly practices and consistent social media marketing, and you should see results in due time. Neglecting marketing can end up costing businesses heavily in the long run.

Hosting issues are all too common and can harm website traffic more than most marketers realize. This tends not to be a challenge for brands that host their store on larger ecommerce platforms, like Shopify or BigCommerce, and it’s often more of a concern for stores that opt for an in-house solution.

Hosting a website in-house can make it tough for businesses to handle larger traffic loads, which in turn causes the website to go down and turn customers away. If you’d prefer not to host your store on an ecommerce platform, many cloud hosting solutions can offer a way out.

Two persons in front of a laptop analyzing site traffic

Poor Quality of Traffic 

Attracting a large number of visitors to your website is great, but it’s not going to benefit your bottom line if they have no intention of buying your product. Poor traffic quality plays a large part in low conversion rates and can be one of the trickiest issues ecommerce businesses have to deal with.  

Raising traffic quality is a matter of precision. The best way to overcome this challenge is to use the arsenal of ecommerce tools at your disposal to reach the right kinds of visitors. This involves using targeted ads aimed at specific customer segments that would be more likely to be interested in your brand, as well as better overall ad campaigns that outline what exactly your product does.

#4: Cybersecurity Issues

Visitors won’t buy from a website they can’t trust. This is doubly true for smaller businesses that lack brand recognition. 45% of cyber attacks in 2021 were aimed at small businesses, and ecommerce customers are all too aware of this issue. 

As an umbrella term, cybersecurity issues can involve:

  • DDoS: DDoS, or Distributed Denial of Service, attacks are debilitating measures taken by hackers that can render a website completely unusable for weeks on end. One of the most worrying aspects for businesses is that these attacks can even be carried out by individuals using bots and don’t require a ton of money or manpower to execute.

    The easiest response to this ecommerce challenge is to use a trusted cloud hosting platform like Cloudflare. Cloud hosting platforms distribute client data over multiple servers operating in different locations worldwide, which means an attack at a single point does negligible damage.
  • Private Information: Nothing drives a potential customer away faster than the possibility of their personal data, such as addresses and card information, being leaked. Businesses that host their store on ecommerce platforms don’t have this issue, as payment processing is handled for them by the platform. Stores that opt for a personalized payment processor without doing due diligence might find themselves susceptible to cyberattacks aimed at accessing customer data.

    Make sure your website is PCI DSS compliant if you’re working with an independent or in-house payment processor. This will assure your customers that their data is in safe hands and encourage repeat purchases. Security plugins like firewalls and two-factor authentication are also popular anti-theft measures that are easy to implement.

#5: Gaining Customer Loyalty

How well you build relationships with your customers will determine your success in the long run. Studies indicate that 65% of a company’s business comes from repeat purchases. Lacking the face-to-face aspect of traditional transactions, newer ecommerce businesses find it challenging to form meaningful bonds with customers. 

  • First Impressions: Gaining a customer’s lasting loyalty begins with providing a memorable experience the first time they shop. Even the smallest issues during a first purchase can color how a customer views an ecommerce business.
  • Loyalty Programs: Financial incentives are incredibly powerful when it comes to motivating customers to return. A loyalty card that rewards repeat purchases with points and coupons is a simple but successful example of a loyalty program in action.
  • Adding Value: Show customers why it’s worth returning to your business by adding value to their life even after their purchase. This can be through informative newsletters at consistent intervals or even blog posts that expand on topics that customers might be interested in.

    The challenge for ecommerce businesses is to communicate in a way that doesn’t come off as spam, as customers can just as easily get annoyed and unsubscribe. Make sure you’ve got your customers’ consent before sending out regular emails. 
Starbucks loyalty program page

#6: Online Verification

It’s hard to distinguish between a genuinely interested visitor and a bot when you get a new sign-up for your website. As the owner, you have to make sure that bots aren’t behind spikes in sign-ups. Failing to verify the identity of customers can open the door for attackers to spoof purchases and even call for chargebacks en masse. If left uncontrolled, this can be challenged by payment processors.

Businesses can tackle this issue by using ecommerce tools to verify identities. The larger platforms like BigCommerce have built-in protection against this with smart CAPTCHAs that automate verification. Another common way of verifying registrations is by sending an email with a verification link that users can click. It’s a great option because it’s quick and requires minimal effort on the user’s part. 

#7: Omnichannel Customer Experience

Ecommerce customers rarely begin and execute a transaction on the same platform. It’s not unlikely that they’ll see your ad on a social media platform, browse your products on a third-party marketplace, and finally head over to your website if they’re interested. The challenge for businesses is creating an experience that’s consistent across ecommerce platforms.

To provide an omnichannel experience, you’ll have to understand how your customers think. What platforms do they prefer to reach you on? Are you maintaining a presence across those platforms?

Identify those platforms and ensure you’ve got a consistent brand presence across the board. A common issue ecommerce businesses face is not interlinking their platforms together to create a unified experience. If a visitor loves your Instagram page but can’t find a link to your actual website, chances are they won’t go out of their way to look for it.

#8: Managing the Competition

A natural consequence of the ease of selling via ecommerce is the fact that there’s no limit to the competition. As an ecommerce business, you’ll be challenged to stand out in a crowded marketplace with products that can differentiate themselves. 

Look for a niche where your product naturally fits and make space there for your brand with an aggressive marketing strategy. Considering how fierce the competition is, your marketing has to be clear in conveying what makes your business different from the rest. Additionally, you can also consider issues that your ecommerce competitors are facing and capitalize on them by improving your operations in those areas.

Turn Challenges Into Opportunities

In ecommerce, every challenge is a chance to grow your business. A proactive approach to problem solving and following a consistent plan for growth is the key to success. Follow the BESTWEB blog for more tips on how to move ahead and scale your business efficiently.