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10 Reasons Why Most E-commerce Businesses Fail


Given the accessibility of online resources and tools, one would think that starting and running an eCommerce business would be easy. Source the products, domestically or internationally, put them on a website, set an urgency discount timer, and voila, you’re off and selling!

The numbers tell a different and sobering story. Almost 90 percent of eCommerce companies fail within 120 days.



Why? After all, online global sales are expected to reach $6.54 trillion by 2023. So why are so many eCommerce companies failing?


There are 10 primary reasons for failure:

1. Lack of Product Strategy

Just because it’s easy to add multiple products on your site, doesn’t mean you should. Selling every little thing from everyone will make you look unfocused. You need to ensure you’re only selling top-of-the-line niche products that your target customers want.

2. Missed Opportunities Because of Weak Content Even if you’re selling the best products, without good content, you will not be able to maximize profits. Low-quality content destroys search ranking of the site and discourages users to click and learn more about your products.

When people open your website, they make quick decisions on whether you’re different from your competitors. Good content is crucial. Whether it’s a product description, photo, video, or a blog post, you need to instantly distinguish your eCommerce site.


3. Weak Search Ranking

Even by having unique products, it’s no guarantee that they will rank well on Google. When your customers search for a product, they’re taken to a SERP:

As an eCommerce business, your goal should be to rank your product pages in the top ten search results. Targeting too many keywords means you’re not focused enough. You need to narrow things down to the search terms that matter most to your customers.


4. Non-Targeted Marketing Efforts

As an eCommerce business, you depend on a regular stream of high traffic. But, a wider marketing net does not always produce more profit. Attracting untargeted traffic to your site decreases conversion rate.

Don’t be afraid to experiment with your eCommerce marketing. Providing value attracts traffic. The right customers will acknowledge your originality and continue shopping with you.


5. Design Overwork

In any business, not just eCommerce, it is important to have a well-designed website and make your brand memorable. However, the rules of web design and beauty standards may vary depending on your business.

A modern eCommerce website should be functional, safe, responsive, and fast. It should not look or feel complicated. A complex design will hinder your conversion rate.

“Simplicity is the ultimate form of sophistication.” Leonardo da Vinci.

Conduct a usability test to see if everything is optimized as it should be on your eCommerce site.


7. Complicated Checkout Process Through online shopping, both you and your customers can save time. But nobody wants to spend an eternity — and in today’s digital world, even minutes can seem like an eternity — filling out forms and going through endless checkout steps. People are desperate for simplicity when purchasing online.

With an average cart abandonment rate of over 74%, eCommerce businesses need to get this aspect refined.


8. Bad Customer Service

According to Microsoft State of Global Customer Service Report, up to 95% of respondents consider customer service as crucial in their choice of brand! It’s not a secret that excellent customer service helps increase customer retention and brand loyalty.

The after-sale is just as important as the sale. It costs five times more to attract new customers than to retain old ones; bad experiences are simply unacceptable. Excellent customer service and your company’s profitability are connected. The more someone buys from your online store, the higher their average order value (AOV).


9. Hidden and High Shipping Rates

Concealed costs and rates are one of the worst of reasons why eCommerce businesses fail! We live in a transparent world — customers can check what shipping costs at other eCommerce sites. Why risk your reputation and lost sales because of shipping costs? Customers want to know what it will cost to get their product, and when they will get it. Clarify both aspects of shipping with details.


10. Poor Site Security

With cyber-threats always looming over websites, it’s more important than ever to plug any security gaps. Target learned that the hard way, with a 2013 breach compromising more than 100 million user accounts and their financial information. Review, revisit, and update your security features regularly.

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