Sales in e-commerce market are predicted to grow up to $218 billion. That sure is an amazing and extremely tempting result! But should everybody invest in a webshop? Will it always be profitable to invest in online trade? I’m presenting some potential risks of e-commerce activities. E-commerce might not suit your business!
1. Don’t even try to sell iPad to a grandmother!
According to statistics only 48% of people over 66 have ever tried shopping online. That means that if most of your customers are over 66, a webshop maybe isn’t such a great idea.
This brings us to threats that your customers feel and there’s a whole variety of those: from the worst fear of having their credit card stolen to the lack of the proper knowledge about the product and many more. Besides, about 25% of all people on the Internet have accessibility issues. Due to personal limitations (i.e. blindness, disabilities) they might not be able to buy online.
You know your customers best and thus you should know if e-commerce will work for your shoppers and then consequently for you!
2. The power and the scale of the Internet
Always remember that most of the Internet content is available internationally. This creates a chance, but also a threat at the same time.
If you want your webshop to reach international audience, think twice whether you are ready for a multinational competition. And are you ready for customers that are constantly comparing products using social network?
To be ready you need to offer something unique or at a competitive price. What’s more you need to be extremely careful about the quality of your services. One disappointed client can criticize you on forums, social networks and blogs and this can cost you a lot. Consider this when trying to innovate your business, because maybe a good, well-built website will work for your business better than a webshop? Of course your answer should be followed by statistics, analysis and even more research!
3. Calculate to earn
The cost of a domain, server and maintenance combined with the renting costs of the magazine or an offline shop, is basically lower than of a regular store. Nevertheless, you need to calculate it all well.
A successful webshop is SEO friendly, mobile and social media ready, safe and well-managed. If you forget about it, you might be surprised by all the hidden costs that you have to make in order to achieve the above.
Meanwhile, you should remember that Internet sales are focused on low profit margin and big cash flow. Thinking about it, as much as 55% of clients choose shopping online because of the lower prices. Check if you can offer any extra treats even after paying all the bills and get a sufficient margin, despite lower prices!
4. There’s crime there, as well!
Although you’re shoplifters and robbers free at a webshop there is other type of crime out there. Hackers, especially those gifted, can steal your or your clients’ money and it’s not only a matter of finances then, it’s also a matter of reputation! You have to do everything to make your website safe but still even the biggest and richest companies fall a victim of Internet thieves. As an example, in 2010 hackers attack website of Chinese e-commerce giant Alibaba. In a result some of the clients could not access the website which obviously led to financial losses.
5. Sensible merchandizing
Ask yourself what attracts your customers in your products. Is it the looks, the smell, the touch, or maybe something else? Even the best photo or the best description can’t replace the real-life experience. Of course it all depends on the product, so see if you can sell your product without giving people a try of it.
If you’re considering having a webshop or have more worries to share, let us know and we’ll try to give you all the answers!