Friday, 8 March 2013

How to avoid the pitfalls of E-commerce! Part 2

As promised, here is your second instalment of guidance CashFlows has created on e-commerce and how your business can make the most of it.

Hopefully by now you will have had time to read last week’s blog post on what you should know before taking your business online? We thought this would be a great place to start our journey of guidance through the sometimes tricky world of e-commerce.

So where next? As the flipside to top tips before starting to sell online, we thought we would explore the common pitfalls that businesses fall foul of when setting up and running a business online to hopefully stop you from making those same mistakes!

So what are the common pitfalls and how to avoid them?

  • Poor marketing: internet and mail order start-up costs can be low compared to conventional retail, but you must ensure you market your business effectively or you will not make a profit. There are many ways you can achieve this without having a large budget, including:
    • Content driven marketing: This includes creating impartial useful content aimed at your target customers in the form of whitepapers, infographics and top tip guides.
    • Social media: This is also a great way of interacting with your customers, but make sure you don't fall into the trap of spreading yourself too thin, identify which sites are most applicable for your business and concentrate on them or you are in danger of creating content on sites that don’t contain your target audience and you just create irrelevant noise! 

  • Poor stock management and fulfillment: a customer places a lot of trust in your business when ordering online that they will receive it in the timeframe and condition you state. Ideally your website should be linked to a back office stock control system so when a product runs out, it will automatically be clear to customers on your website so you’re able to manage their expectations. Equally important, you should avoid overstocking, buying equal amounts of similar products regardless of their sales potential as this will just create an unnecessary backlog of products.

  • Failure to meet customer service requirements: unless you deliver on time and have good practices and procedures for handling returns and customer complaints, you won't win repeat business and could cause unnecessary and time-consuming disputes.  Ensure you are always honest and clear with your customers on your website so that they enjoy a consistently positive and memorable customer experience. Make sure you also display your terms and contact information clearly on your website so customers know what to expect, which will help to and reduce the amount of complaints. This also helps protect your business in the event of disputes arising over non-delivery.

  • Not asking enough questions at the start: This is the biggest pitfall that many businesses fall into when starting an e-commerce business is not asking enough questions from all suppliers and providers who will be effecting their business. Knowing what terms you have, what the penalties will be to exit from a provider, what your monthly fees will be, what flexibility you have to grow with a provider are all key questions you need to be asking before signing any contract whether it is for a shopping cart or a business bank account. The more questions you ask the more you know whether that provider is right for your business, so it pays to be pedantic!

Look out for next week’s instalment!

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