eCommerce: Avoid 3 Common Mistakes of The Startup eTailer
by Chris Peer on Fri, Jun 21, 2013 @ 05:42
As the Internet continues to morph at warp speed, more and more individuals and businesses are jumping at the opportunities that selling their products online offers. Today, launching an eCommerce website can be done with a very limited budget and in some cases just days. With quick-start tools and rent-a-site offers, the allure of throwing up an eCommerce website is not only within reach but usually quite simple.
The Unfortunate Truth for eCommerce site owners
The unfortunate truth is that many of these quick launch solutions are ineffective. Website development agencies take on eCommerce projects and a large majority of them have no idea what they are doing. Sure, your website may “work” from a functionality standpoint and the design may be beautiful but you may soon experience that you have little to no sales. Worse yet you may find that your website does not have the tools required to track, assess and grow your eCommerce business.
The Paradox in Building eCommerce Budgets
A common paradox I often see with new online retailers is that business owners want a low budget solution to get started but expect big results. So both you, the eCommerce merchant, and your website development agency cut corners to hit budgets, sacrificing long-term benefits for short term implementation.
At my company, SyncShow Interactive, we help eCommerce businesses with less than ten million in revenues to grow their eBusiness. Some of these companies are start-ups with less than $500,000 in revenues, some are pre-revenue, meaning they are truly a start up. We often see the results of the paradox stated above and the impact it has on a business.
A Common Scenario in Agency Relationships
ABC Company is an online retailer. They hired a local agency (Agency 1) to complete the website build and the site looks pretty and functions fairly well. But after 12 months the site is getting little traffic and sales. Worse, Agency 1 does not really know much about eCommerce. So, ABC Company hires another agency (Agency 2) and that agency while great at programming and development does little to improve sales. Agency 2 goes in and makes all of these changes. Six months later ABC Company has spent tens of $$$ thousands of dollars and still has little to no sales.
This is where ABC Company hangs it up and calls it quits or determined to make it work, hires Agency 3. My company is often Agency 3 and listed below is usually what we encounter.
- The Customer is in pain. They have spent lots of money, wasted lots of time and is very frustrated.
- The Customer is untrusting of “agencies” and feels like they were taken for a ride.
- Agency 1 and Agency 2 had good intentions but they did not deliver and the Customer paid the price.
- The eCommerce website is on a “home grown” shopping cart software or on a popular platform such as Shopify, Magento or BigCommerce (to name a few) but poorly implemented.
- Once on the shopping cart software mentioned above, Agency 1 or 2 then manipulated the code, maybe even deleted critical code and future upgrades become a nightmare.
- The eCommerce website is lacking the analytics, tracking, and reporting functions to make intelligent, insightful decisions.
- Agency 3 inherits a mess of programming code and a customer that does not believe in certain marketing efforts because they failed in the past, so it’s a hard path to get real traction with proven methodologies.
So How Do Online Retailers Avoid These Common Mistakes?
As your website sales grow, so will your needs. My #1 recommendation is to choose a shopping cart platform that will meet your needs both now and in the future. Provided below are some things to consider:
1. Choose a popular shopping cart software.
Don’t necessarily trust the Agency you are talking to. The agency may have an interest in steering you to what they know or are incentivized to sell. Look on the Internet for testimonials, user ratings and complaints.
- Popular platforms like Magento, BigCommerce, OSCart, Xcart, etc., have developers all over the world, certified training programs, customer support and if you need to hire Agency 2 or Agency 3 you will have a better chance of finding an expert resource.
- Popular platforms often offer robust features and functions that you can simply turn on when you need them and use them to grow.
- Hosting requirements are standardized and finding a strong hosting partner will be easier.
- Usually, these platforms have “starter” packages with the ability to upgrade as your needs dictate thus reducing future costs.
2. Hire a Certified Agency or Certified Developer
- Avoid major issues by hiring a development agency that knows the shopping cart you want to use.
- Certified developers know the ins and outs of the software and will know best practices and avoid making mistakes that may cost you in the future.
- Certified developers are more expensive but will save you tons of money in the long-term.
3. Differentiate between Strategy and Development
- Many development agencies do not know how to implement growth strategies and many strategy agencies don’t know how to develop. Choose wisely as your development firm and your strategy team are integral to your growth.
- When choosing a strategy agency do your homework. Find an agency that focuses on your goals, measurable goals. Look for transparency and demand that your chosen agency is results focused. If their process does not include goal setting and key performance indicators (KPIs) to track, find another agency!
The Internet is like a never-ending networking event. The Internet is not the problem, its your approach, your belief structure, your plan and your tactics. This is why so many companies see both success and failure online. This is why it is so important to do your research up front and choose the right agency or do-it-yourself model. You will have setbacks and you will fail on some occasions. Don’t quit after Agency 2. Keep going to find what works best for you and give it time to work. Whichever way you go, do your homework, draft a plan and stick to it.
Tell us the one thing in the comments below that STARTUP eTAILERS MUST AVOID to ensure success. What is one lesson you learned?
Another post by Chris Peer on eCommerce or Lead Generation: (Quick How-to) eCommerce Pricing vs Profit Winning the Price War