Week Four: E-Commerce!

Its the third week of COM125, been a hectic and tiring week due to upcoming tests and quizzes, but I'll still try to make this work for all of us! Lets gooo~

This week covers the topic of E-commerce, or more simply the task of doing business electronically, or online. No doubt starting a traditional business model is already hard enough, think about doing it via online means, where you have less control over the market you are breaking into.

Time to study? Welp goodnight

Perhaps starting an E-commerce business seems like an attractive venture on the outside, but the reality is that it is EXTREMELY risky. Following last weeks AIDA model(Attention,Interest,Desire,Action) it is no easy task to attract and retain your customers attention and action to complete the sale. The sad(BUT true) fact is that over 97% of business fail to succeed online, with only a mere fraction(3%) managing to break even or flourish in the market. However a piece of good news for aspiring e-businessmen(I think I just coined that), of the 3%, nearly all of them make double or triple the profits by reaching customers in parts of the world not normally attainable through traditional means. Huzzah! 

Key to success: Have a catchy accent

As such, the one question that lies on every entrepreneur's mind is: WHAT IS THE KEY TO SUCCEEDING ONLINE? Herein we will explore ten reasons why so many business fail to take off online, and some tips to rectify these problems for all you wannabe billionaires out there. Pay heed.

AND here we go:

1. Lack of Planning/Forecasting

 Every business needs to have a proper plan or forecast to predict what could go wrong and to keep focused on your goal for the long-term. As an e-commerce, there are some points you need to factor into your planning process:

• Is there a demand for your products online?
• Are your intended products selling online? If yes, what are the sales statistics(number of sales per day etc.)
• How much are you intending to peg your product price at, and how much are your competitors pricing their products?
• Will your e-commerce website be profitable?

2. Lack of a Unique Selling Proposition
In the AIDA model, one of the strategies advocated is to have a unique and novel selling point that would allow customers to be attracted to your particular product. However, in the online world, 99% of e-commerce businesses do not follow this advise and ultimately end up failing, sometimes terribly. Such businesses make the common mistake of following the market leaders and imitating the competition. A piece of advice to take note here: DON'T launch a business just because every one is doing it. Yes you blogshop hopefuls I'm talking about you.

 

 The tip to take away from this is: Make your business unique and special, so much that other competitors start copying you. Now you can sit back and watch them crumble. Our recommendation for your business idea is to set up a differentiator first and then prepare for a launch. 

3. Trying to sell everything, to everyone

Once you have done planning and coming up with a new idea for your e-commerce business plan, its time to decide on the number of products you want to pitch to others on your website to begin with. Do NOT try to sell too many products initially. You're not Amazon. Stop. Please.

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An important factor to take into account is the time required to acquire, stock, sell, ship, and support your product(s). Be upfront and honest with yourself: Can you actually afford to spend the time required for the above processes? Also, one more useful tip would be to offer some sort of 'value for money' to your customers in your business transactions, perhaps in the form of an e-voucher for a certain amount of products purchased. Distinguish yourself from your customers; you are a businessman, not their friend. A businessman who provides exceptional value-for-money services. 

There IS a difference.

4. Poor User Interface Design
An important but often overlooked aspect of an e-commerce business is aesthetic appeal. A design of an e-commerce website is one of the first, if not THE first visual element customers notice when first patronizing your site. The rule of thumb is to be able to grab their attention within the first five to seven seconds, thus:

• Ensure site design is of a neat, aesthetically appealing nature that attracts online traffic
• Hire professional graphic or web designers to work on site. Make it a good investment. 
• Make sure your website loads as quickly as possible. 'Aesthetically pleasing' doesn't mean you fill the whole page chock-full of animations. Keep it simple, stupid. 
• Check that your business website is responsive and renders properly on both tablets and smartphone devices. Apple and Android both, preferably. 

Of a low temperature, thou art not.

 

5. Lack of Quality Content
On a website, having poor content quality including but not limited to, headlines and product descriptions can and most likely WILL reduce overall sales. Your e-commerce site needs to educate and create a desire in your customers to want to take action and purchase whatever you are selling. Make good use of emotional triggers like promoting your products strengths; focusing on its benefits, experiences and results it will help your prospects achieve. User generated content and reviews should be allowed on-site as it helps gain the trust of future and current customers.

6. Lousy E-Commerce Backbone/Software
Making use of a low-quality e-commerce backbone will ultimately affect web usability for you as the business owner, and also for your visiting customer. Some of the major problems encompass:

• Poorly laid-out products
• Lack of discounting feature
• Non PCI-Compliant code
• Lack of search engine optimization features

7. No testing of product

It's hard for most entrepreneurs to admit, but sometimes your product is just not that great. Don't wait until you have put months into an e-commerce site to find out whether there is a demand for your product--start with friends and friends of friends. The old idea of "starting a business out of your garage" worked because it showed proof of concept and demand before any time or effort was put into the business. Conduct surveys or try selling samples of your product before spending blood, sweat, and tears to launch a company online. Even if your product has legs, you should always test and refine first.

8. Difficulty in finding E-Commerce Website

You may laugh, but this is one of the most common misconceptions about running an e-commerce site. Too many entrepreneurs think, "We'll just launch it and make millions!"

No one will end up on your site accidentally--the Web is just too big. Every person who visits your new site searched, saw an ad, or was somehow told to visit your site. You need to have a plan to get traffic to your site in a very direct way, so enlist the help of a PR or advertising firm to assist with SEO efforts and getting back links to your site.

 

9. Failure to set budget for market testing

Free marketing is awesome but usually not scalable. You need to get your e-commerce site to a scale that makes it worth the time you put into it. Sometimes this will require testing different marketing channels and strategies to find what works best for your business. Remember: This is going to cost money! Make sure you have a budget set aside just for testing. It needs to be enough to test several channels, but not so much that it will cripple your business if you don't see ROI. Create a separate budget to pour into the channels that are successful. The best e-commerce brands test and retest every aspect of their funnel on a continuous basis--from layout to colors to flow to channels. All of these can affect your conversion in a big way.

10. Failure to PESEVERE

While realism is important, Seth Godin said it best: "It takes about six years of hard work to become an overnight success."

 

There are those that get lucky, sure. But 99.9 percent of success stories worked day and night to get there. It's important to know that it won't be easy and it won't come quickly. But if signs show you have a great product or concept, it's worth giving it a real shot. Pursuing your passion and success should be the only option.

 

So that's it young ones. Hope that's enough to get you started on your first ever E-commerce project. and remember,

 

NEVER GIVE UP!!