With the advent of the digital age, online shopping has become increasingly popular among the general public. The COVID-19 pandemic has only accelerated this change in consumer spending behaviour. Today, e-commerce has become an indispensable part of the global retail framework.
However, entering the e-commerce industry comes with its own unique set of challenges. According to various studies, about 90% of e-commerce businesses fail within 120 days of their launch. There are various possible reasons behind these failures. But often, the failures and mishaps of these companies boil down to a lack of preparation and organisation. Therefore, let us share the most common mistakes you should avoid for your e-commerce business to succeed.
1. Ignoring the importance of research
Market research is one of the most fundamental things that entrepreneurs should do before starting a business. In the e-commerce industry, research is crucial if you want to develop a successful business strategy. You can expect to face stiff competition in this industry, so make sure to analyse the market before launching your e-commerce business. Doing so will help you better gauge the profitability of your business.
2. Failing to define the business’s niche
Some entrepreneurs start their business without first determining their target audience. This is a significant mistake that you need to avoid when launching your e-commerce business. Your target audience is the biggest asset for your company. Without defining your target audience, you will never know if they need your products or not. Therefore, for your e-commerce business to succeed, your products should address the demands and needs of your audience.
3. Not promoting enough
Promotion goes hand-in-hand with sales. If you want your products to sell, you need to market them well. However, many new e-commerce entrepreneurs make the mistake of not promoting their websites. If consumers don’t know your products exist, they cannot patronise your business.
You cannot expect your target audience to come to you; you need to make an effort to reach them and inform them of your brand. Therefore, it is essential for you to devise an excellent marketing strategy so you can establish a strong brand identity.
4. Poor website design and navigation
Effective digital marketing starts with a good business website. For your website to be a successful tool in promoting your e-commerce business, it must deliver a great user experience. Poor design and navigation will only frustrate and drive your customers away even if they are interested in buying your product.
5. Lack of inventory or financial management
Poor inventory and financial management strategies are the banes of numerous businesses. Even if your products are selling well, your e-commerce business could still fail if you do not manage your inventory and finances properly. When you overstock your online store with products that you cannot sell or overspend on certain areas of your business, you will most likely experience declining profits. Therefore, it is crucial for you to stay on top of your company’s inventory and finances.
However, if you are struggling to keep track of your business’s finances, you should consider outsourcing your accounting needs to a specialised accounting firm. At Ackenting Group, we offer a suite of trusted accounting services that cater to your company’s needs. Rest assured that our team of experienced accountants will provide you with prompt and accurate financial reports so you can have a better understanding of how your business is performing.
Conclusion
The advent of e-commerce has provided entrepreneurs with a new business avenue to profit from. However, as this industry continues to surge in popularity, e-commerce business owners are expected to face increased competition. Therefore, it is crucial for you to avoid the common mistakes made by failed e-commerce companies. By learning from their missteps, you stand a greater chance of ensuring your business succeeds.
If you require any assistance on accounting services, feel free to drop us an email at johnwoo@ag-singapore.com or contact us at +65-66358767. At Ackenting Group, we offer a complimentary 30 minutes online consultation for us to better understand your business requirements.
