28 August 2020

by Alex Husar

Top 5 Mistakes Online Retailers Should Be Aware Of

FOR BUSINESSES

With customer behavior changing dramatically, retailers face many challenges that may hinder their progress and even ruin the entire business. Here we will talk about the top 5 common online retailers mistakes that new and old players should be aware of.

Table of Content:

  1. Choosing the Wrong E-Commerce Platform
  2. Complex Navigation and Poor UX
  3. Underpricing your products
  4. Not showing a product from all angles
  5. Not nurturing customers after their orders

small business stats

The reasons for the failure are diverse ranging from choosing the wrong platform for an online store to an inefficient arrangement of shipping processes. That’s why it is crucial to prepare yourself for success by avoiding the most common mistakes that other entrepreneurs make while doing business.

5 critical online retailers mistakes you should be aware of:

Mistake #1: Choosing the Wrong E-commerce Platform

Even though it may be tempting to cut down expenses by opting for a cheap platform, this decision may have negative consequences over the long run. To be fair, an eCommerce platform not only determines how your products will be showcased but also contributes to customer attraction and retention strategies, as well as regulates a possible level of your website scalability.

As a result of the discrepancy between the CMS capabilities and the customers’ needs, your business can hardly withstand the competition, attract new customers, and retain the existing ones. Thus, once you have a business plan in place, consider certain questions while choosing an eCommerce platform:

  • Do you want a custom design or template?

In a custom-designed website, every element is adjusted to fit your needs. Your strategy and content come first and the layout is built around them.

  • What tools do you need to be integrated with your CMS?

Perhaps, you want to integrate the platform with Facebook or Instagram to create shoppable posts with links to your catalog, or connect the store with Salesforce to manage your leads – it entirely depends on your needs.

  • Will the CMS scale as your inventory grows or will you have to reinvent the wheel once you hit it big?

Some platforms can handle only a limited amount of products and make your site slow when the limit is exceeded.

Mistake #2: Complex Navigation and Poor UX

Since the main aim of a strategy behind any eCommerce website is to convert users into buyers, you should prioritize its functionality, convenience, and user experience. As such, your site has to look trustworthy and deliver your ideas or products to the users in a clean and logical way.

If your store navigation uses confusing terms and your content is difficult to find, this creates friction to the users’ actions so that they will likely get frustrated and go somewhere else.

Just have a look at the layout of this eCommerce website.

random use of elements

Random use of colors, poor typography, the absence of a grid along with visual elements placed anywhere contribute to making this site an incomprehensible mess.

Using a grid will help make everything organized and clear, keep all the visual elements in their places and create a consistent, well-designed interface. When users land on your site, they should understand what exactly they can do next and what actions to take to reach the destination.

Below you can see the official ASOS website where everything is well-structured and organized.

asos online retailers mistakes

Among the most common online retailers mistakes that online entrepreneurs make is no-responsive design. Even though it has been a long time since Google began to penalize websites without responsive design, many online entrepreneurs still disregard this rule.

online purchase fact
Source: Outer Box Design

To create an enjoyable UX and smooth navigation for your customers and avoid these mistakes, it is a good practice to collaborate with UX experts.

Mistake #3: Underpricing Your Products

Driven by a desire to conquer the market at a faster pace, a lot of inexperienced retailers undercut the prices to gain as many customers as possible by selling products at a bargain price. However, this strategy inevitably leads to losing money instead of generating it.

Taking into account production, marketing, listing fees, shipping and handling, customer acquisition, platform costs, and taxes, online entrepreneurs often have to upward prices to generate positive cash flow.

It is crucial to do a financial analysis that takes into account all overhead costs to properly price your products. As Nate Ginsberg (a successful e-commerce entrepreneur) said, “E-commerce can be VERY expensive. And you can often lose money and not even know it if you don’t know your numbers.”

Quick Fix: By integrating your store with a robust CRM, say, with Salesforce, you can easily track all expenses, as well as load them into your financial analysis and measure on a quarterly or monthly basis.

Mistake #4: Not Showing a Product From All Angles

Content and product images are the most important components when you are selling online. If either one of them is weak, you will never reach the results you expect. Your visitors need detailed and mature product pages to gain trust.

In order to provide users with product details, it is a good practice to showcase optimized images. The quality of these images, as well as zoom, have to be perfect.

In the ideal case, your visitors should get a feeling of physical presence as if they are viewing the product in a brick-and-mortar store. For this purpose, it is recommended to show products from various angles and in different contexts.

See below how Target Australia demonstrates their Lego collections in context:

target australia

You can go one step further and implement cutting-edge technologies to your site to engage and re-engage your customers.

For instance, AI-powered virtual fitting rooms are growing their popularity in the online retailer industry. Based on augmented reality, this feature allows users to virtually try on a product and consider it in all its bearings before they buy it.

As such, virtual makeovers have become very popular in the cosmetics industry, for instance, such big brands as L’Oreal and Lancome have implemented the functionality to their sites. This makes it possible to see how, say, a lipstick looks on you.

Look at how the virtual makeup feature works on the Lancome website:

lancome website

However, it is worth mentioning that such a feature is hard to develop and is available for mid-size companies and large enterprises which have internal development resources. Nevertheless, you can hire experienced developers who can introduce augmented reality to your site.

Mistake #5: Not Nurturing Customers After Their Orders

This is one of the most common online retailers mistakes most eCommerce owners and sellers tend to make. There are two ways to boost your online business. The first one is to constantly acquire new customers, while the second is to focus on retaining existing clients and increasing their CLV (Customer Lifetime Value).

As such, once a purchase is made, you need to work at staying at the top of the customer’s mind to convert a one-time buyer into a loyal customer or brand advocate.

Don’t wait patiently until they decide to make another order, Otherwise, your investments will yield more humble results than they could.

Besides, according to a Harvard Business School research, a customer’s 6th purchase is an average of 40% higher compared to their first. This proves that repeat buyers spend more than first-time ones because they already trust your brand and products.

Not nurturing customers after their orders is a huge mistake that a retailer can make. You need to cultivate a close relationship with your clients starting from the moment they receive their first purchase.

For instance, one of the marvelous ways to make your shoppers return to your site is by encouraging them to leave a product review or share their feedback.

Below you can see how the official Forever21 website collects the reviews of its users:

forever21

Newsletters and mail outs are both powerful tools to return visitors to the website. But the main challenge is to get customers subscribed.

A good practice is to offer better terms to those people who join a loyalty program or make a subscription by pitching some perks (coupons, discounts, bonuses).

Take a look at what the famous cosmetics retail, NYX Professional Makeup, offers to the clients:

nyx professional makeup

Conclusion:

There you have it. Top 5 common online retailers mistakes that you should be aware of.

What are the top mistakes you’ve made that have affected your sales and CTR? Let us know in the comments below.

Alex Husar

Alex Husar, a CTO at Onilab with 8+ years of experience in Magento and Salesforce. He graduated from Czech Technical University and obtained a bachelor’s degree in Computer Software Engineering. Alex’s expertise includes both full-stack dev skills and a strong ability to provide project-critical guidance to the whole team.

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