What is eCommerce? Do you intend on starting an e-commerce business? Terrific! The time to join this field is right. By 2021, global e-retail revenues are projected to rise to $4.8 trillion, according to statistics. In reality, e-commerce is rising so rapidly that a whopping 2,14 billion people are projected to be served.
E-Commerce is selling goods online, and when you are online, your reach increases manifold. Of course, there are even other advantages of having an e-commerce platform, which we'll speak about below. You can discover the pros and cons of an e-commerce website in this article so that you can determine for yourself whether this is the right form of business for you. These advantages of having an e-commerce platform will help you stay excited and motivated throughout your entrepreneurial path.
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What are the advantages of having an E-commerce website?
- Selling Internationally
- Easily gain access to client data
- Quick to Highlight Bestsellers
- Clients have a less intrusive experience
- Personalized experience online
- Low Cost of Financing
- Affordable Workers
- Organically increasing your company with content
- Potential Revenue 24/7
- Simple to Retarget or Customer Remarket
- Able to accommodate a high number of orders
- Business Can Scale Quickly
- Easier to encourage buying impulses
1. Selling Internationally
A new brand can easily reach customers worldwide. It does not matter that the customers are in the U.K., South America, or surrounding nations, you will find your audience. Many brands offer cheap ePacket shipping as well. This makes it possible for you to price and ship your goods to a worldwide audience competitively.
It's a great feat to sell worldwide as it lets you develop your brand even quicker, grow your marketplace exponentially, and allows you to see benefit long before your local rivals. Plus, you may be able to prevent many of the headaches associated with transporting goods across borders.
2. Easily Gain Access to Client Data
One of the best e-commerce benefits is that the customer can easily access data for research. Most individuals feel awkward, giving physical retailers email addresses or postal codes away. In e-commerce, you can get the name, mailing address, email address, and phone number of your customer. That means that you have at least three different ways of interacting with them and establishing a relationship. You can also get them to fill out marketing surveys, share with you their date of birth, and more. You may collect even more details to best support them if you ask them to build an account. If your customers are located within Europe, when contacting them, be careful of the GDPR.
3. Quick to Highlight Bestsellers
Ecommerce advantages such as showcasing best-sellers make it easier for the consumers to show off goods. Although you can plan a brick-and-mortar shop to inspire customers to purchase those items, it is easier for a consumer to find the best sellers in an online store than to navigate various aisles and shelves. The reason why you want your best-sellers to be bought by clients is that they're proven.
They have already been purchased by other clients and are satisfied with their purchase. If you want to offer consumers fresh goods, you can include them in your advertisements for upselling, email marketing, or retargeting.
4. Clients have a Less Intrusive Experience
Some people fear going into a brick-and-mortar shop as they are forced to deal with the store's employees. If learning about a sales deal or being asked questions during the shopping process, online shopping can be preferred by certain consumers as it can be a little less intrusive, making it one of e-commerce's website’s best advantages.
They can click on a live chat feature, email, or send a Facebook message if a customer wants to contact the store owner. In exchange, the store owner can train the customer service workers to answer queries effectively. They may use a chatbot to direct customers towards FAQs and other self-help tools when the staff is not around.
5. Personalized Experience Online
Personalization of websites can help boost the shopping experience online. One of the greatest benefits of online business is creating custom landing pages for various audiences. Without much hard work on your part, this will entice them to buy from you. It's not like customers you need to nurture from the first minute come into a physical store. Before you begin a campaign, you can do all the hard work and relax until you start selling to your customer base.
Via your email marketing campaigns, you can also personalize the experience you have. Based on transactions made, location, or even how much money a customer spent, consider segmenting the email lists. Another idea is to retarget customers who visited your online shop, showing them an advertisement for a product they added and forgot about in their cart. If your online company has a login feature, a welcome message such as 'Welcome back (name)' can appear. Bundles of items will help the consumer purchase more at a lower price, increasing the average order's value. Based on what the client has looked at or what you think they would want based on their buying actions, you can even tailor upsells.
6. Low Cost of Financing
One of the advantages of eCommerce is that it has a lower start-up rate. To lease one of their store locations, physical retail stores have to pay up to thousands of dollars. They also have some upfront expenditures, such as shop signs, store design, inventory procurement, equipment for sales, and more. Let's not forget that the store owner still has to employ workers to operate and run each location.
Depending on the product value in the shop, they will even need to employ security employees. You will only need to recruit employees if you expand to a certain amount, depending on what type of e-commerce company you operate. These workers can work remotely as your online store is online, making it easier to find employees that suit your company. If you want to dropship online, you won't need to purchase bulk inventory that saves you a lot of cash.
Apart from that, some of the best e-commerce platforms for small businesses are also free or very less expensive. So starting a site there on Shopify or Woo-commerce is easier and cost-effective.
With e-commerce, branding is also cheaper. Often, the emblem of your shop is more affordable than a store sign. And graphic designers are often less costly than what an offline paint job would cost you (yes, including the best ones).In general, company costs are much smaller, which is one of the most appealing advantages for new entrepreneurs.
7. Affordable Workers
One of the advantages of e-commerce is that it is affordable to recruit workers, and you can hire them from anywhere in the world, as stated before. In countries where the cost of living is much lower, you can opt to outsource jobs to virtual assistants.
In an online sector, you'll need fewer workers than in a retail store. You don't need to recruit workers at launch, a big benefit of online companies. You can launch and operate an e-commerce company all on your own. You can begin to develop a team only when you start to grow or when you have the money.
8. Organically Increasing your Company with Content
With eCommerce, with eCommerce blogging, you can increase organic traffic and sales. You will be able to customize your store to drive traffic and sales without having to spend more money, from creating videos to writing blog material. Plus, through content creation, you will not only be able to get traffic organically, but you will also be able to monetize those clients with retargeting ads. To promote visits or ensure they are situated in a high traffic area to get more shoppers, a brick-and-mortar store will need to advertise to their customers.
9. Potential Revenue 24/7
Another benefit of e-commerce is that online shops are still available for business. You will attract someone at 11 p.m. with Facebook ads or 4 a.m. In every region of the globe. Many physical location stores, by comparison, are operational between 9 a.m. By 9 p.m., which gives you a competitive advantage. You will draw individuals who would usually pick up a product in stores if the outlet were open by being available at all hours.
Think of your audience who don't work regular hours or who are too busy to buy anything in a store. You may draw those who may have unusual work schedules or who may not have time to shop in person through an e-commerce store.
And what about clients who order at night? Ok, to satisfy their demands, you don't need to have workers working a night shift. All you need to do is automate the ordering processes so that customers receive a confirmation email to give them peace of mind when they position their order.
10. Simple to Retarget or Customer Remarket
To reach out to consumers in your region while running an online business, it is simple to build retargeting ads, making it one of the most lucrative e-commerce advantages. To view advertisements to your potential customers in their Facebook feeds, you can create a Facebook Pixel. To retarget the people who visit your store but do not buy, you can use the Shoelace Shopify app.
You can retarget people with e-commerce stores who add items to their cart but give up and don't purchase, or those who visit a blog post and never buy. With an efficient pop-up or lead magnet, you can easily gather email addresses and continue marketing to your clients after they leave your site.
11. Able to Accommodate a High Number of Orders
If you prefer dropship, you can easily process a large number of orders. You might want to recruit staff to assist with order processing as your company continues to expand. Also, you do not need to physically have the product to sell it to a customer with dropshipping.
Long queues in retail stores can discourage individuals from shopping. With eCommerce, there's no time to wait. With no delays, a client can position orders on their schedule, enabling you to accept a high number of orders.
12. Business Can Scale Quickly
One of the advantages of e-commerce is that the company is easy to scale up. When people click and buy, you can increase your ad budget without worrying too much about keeping up with the demand, particularly if you decrease.
With brick-and-mortar stores, it can be difficult to expand product lines or add more cashiers because of the limited space. To scale up your business, you will need to find a larger room, renovate or wait for your lease to end. If you build knowledge items, as it takes time to write ebooks, courses, and more, you run into a challenge again.
You can add new items to your store with the dropshipping e-commerce model without having to worry about shipping products or keeping an inventory, enabling you to expand rapidly.
13. Easier to Encourage Buying Impulses
Another advantage of e-commerce is that as online shoppers are more likely to engage in this, you can capitalize on impulse shopping. You can create advertisements that drive impulse purchases if you have appealing product photography, with vivid colour or human emotion.
To inspire customers to buy, you can also conduct various scarcity strategies such as countdown timers or displaying limited quantities. If you have a new or limited-edition item in your inventory, consider checking it out to see how customers respond to impulse purchases.
As impulse shoppers appear to be more social and image-concerned, they may buy before anyone else for an opportunity to boast that they have got the latest product.
What are eCommerce's disadvantages?
As with any pro, there is a con. So, it is important to be practical when starting an online store. Below are several e-commerce drawbacks usually faced by retailers that do not extend to a physical store.
- Customers can't try before buying an item
- Times of shipping can be time-consuming
- ECommerce is highly competitive
- Physical retail, despite the decline, is still more common
- During a site collapse, no one can buy
- Consumers may be impatient
1. Customers can't try before buying an item
Although this is a challenge for many retailers at present, this will not be a long-term issue. More shops are beginning to introduce AR elements to their store with augmented reality to allow customers to try items. Ecommerce businesses provide options for organizations to create a more immersive consumer experience using augmented reality.
How does AR work exactly? For example, you can check out Sephora's Virtual Artist app. The beauty retailer has an augmented reality environment where consumers can digitally try various eyeshadows, lip colours, and more.
2. Times of shipping can be time-consuming
Customers perceive delivery times to be one of the worst drawbacks of e-commerce. Customers can take the product home right away when they shop in person. But, with online shopping, in a week or more, most clients obtain their items.
While Amazon provides same-day delivery, before they created Amazon Prime, it was not a profitable model. Only since they have tens of millions of Prime members has it been successful. The solution is for your client to be clear. When they place an order, let them know when they should expect packages.
3. E-commerce is highly competitive
Another of the worst e-commerce drawbacks is competing for clients. The truth is that the most competitive niches are always the strongest. That is why they are attracted to so many entrepreneurs. The more competitive a market is, however, the more costly advertising for that niche is. There are a few ways around that.
Next, you should implement a marketing campaign different from your rivals. If all your customers are targeted by Facebook advertising by rivals, you might try SEO optimization to rank organically. If your rivals are using Pinterest, if your audience is visual, you should try Instagram marketing. Second, if your ads are costly, you can send traffic to blog posts and retarget your clients who visit them to generate lower-cost ads.
4. Physical retail, despite the decline, is still more common
While one of the advantages of commerce is that it is increasing, much of the market share is still held by physical retail. By 2020, despite the COVID-19 pandemic hitting offline stores hard, the retail industry had earned $4,184 trillion. Yet, just $709.78 billion was made worldwide by online trade.
In the early stages, launching an online company helps you to become a pioneer in your niche. However, you might suggest building an online presence for your company and vice versa if you have a brick-and-mortar store. Amazon, for example, is also creating in-person stores, despite being the largest online retailer. Similarly, distributors like Gap and Macy's are scrambling to go online. As things currently stand, there is a great deal of opportunity for e-commerce firms to cash in.
5. During a site collapse, no one can buy
If your site crashes, the worst of the e-commerce drawbacks is that no one can buy from your store. That's why ensuring your website is hosted on the right platform is crucial. For instance, if you pay the minimum hosting fee and get a traffic boost from a high conversion ad or a TV shout-out like Shark Tank, your website is likely to crash.
Fortunately, in its monthly charge, e-commerce solutions such as Shopify offer free hosting, enabling you to have one of the best servers on the market. There was only one time in recent memory that the pages were down. E-commerce stores, however, were not the only places affected. This crash impacted Twitter, Spotify, Soundcloud, and more. The next day, the matter was settled. Yet, on platforms such as Shopify, site crashes are so rare that the company is not likely to cause problems.
6. Consumers may be impatient
If a customer has a question, a salesperson is ready to address them on the floor. An e-commerce downside, however, is that most companies face a pause in responding to customer inquiries. The fact is that most consumers expect a response from a company on social media within an hour. If you hesitate to react to their message, they may instead become frustrated and shop somewhere else. You need to be 24/7 online.
You may recruit representatives from customer service who are trained to make your customers happy. Or you can work with a chatbot to assist clients at any time of the day or night to find their answers. But all of this is still not equal to a person who can take care of each client face-to-face.
There are more upsides to starting an e-commerce venture, as you can see. Plus, by being diligent and implementing the strategies listed above, you can resolve the challenges. E-commerce is a booming industry, and it is only expected to expand in the years to come. The learning opportunities here are endless. With KoolStories, you can learn about ecommerce website development. Sign up for 15 minutes micro courses to upskill yourself!