RUNNING or thinking of starting an e-commerce site? Or maybe you’re planning on taking your existing retail business online? It’s not just about consumers either. Servicing your business customers online can bring a wide range of benefits. The rewards can be rich but the pitfalls are many, and e-commerce brings challenges that are unique to online businesses.
Alan Linton, a Scottish Enterprise specialist in information and communications technology, runs through five of the most common problems facing e-commerce businesses, and gives a range of practical solutions and advice for overcoming them.
Lack of visitors to the site – when people don’t know about you
A lack of visitors to your online business is either about people not knowing your site exists, or being unable to find it. Both these problems can be tackled by good use of Search Engine Optimisation (SEO). For this you need good content, which is not just about stuffing your site with keywords. It’s about thinking about what people will be searching for that could lead them to your site – which is all about understanding the customer mindset.
Paid advertising is another method for getting people to your site. Google Adwords, for example, can be particularly effective for targeting a niche market. Google can be expensive for advertising (the more popular the keyword, the more it costs) but using less in-demand keywords will cost far less, making it ideal for niche products or markets – although equally, even those selling a mainstream product will be able to find niche terms which can be used. You might only get 100 customers using niche search words, but they’ll be the right 100 and more likely to buy.
Social media - social networking sites like Facebook, Twitter and YouTube - is another tool for alerting and directing people to your site. Again though, you must get into the mindset of your customer in order to tailor this usage. For example, Pinterest has an 80% female audience, so can be ideal for targeting brides planning their wedding. It’s also not as simple as just selling your product over social media – it’s about engaging with the customers, it’s meant to be a conversation. For example, we advised one self-catering accommodation owner in Crail to use social media to talk about the town’s food and arts festivals rather than about their own business directly – and that way when it came to potential customers booking a place to stay for their visit to the festivals, theirs would be the business which sprang to mind.
Similarly, London florist Arena uses its Twitter feed to tell jokes, knowing full-well that nobody really wants to talk about flowers, but that if they tell good jokes people will retweet them, thus spreading the name of their business around. This way, when customers do need to buy flowers –they will know exactly where to go. Scottish haggis brand Macsweens uses social media to “extol haggis as a versatile ingredient, for all seasons, occasions & places”. They’re talking about food with foodies, not just haggis on Burns Night. Retweets are free advertising, and interesting things get retweeted. You need to define your audience, understand how to talk to them and think about which platform is best to reach them.
Low conversion rates – when people browse but don’t buy
If your site is being found, and people are browsing, but not making a purchase, you need to understand why customers are leaving the site, and why they leave it when they do. For this, Google Analytics is your first port of call. It’s free, it’s the most widely used service of its kind, and you can get a great deal of intelligence on how and why people use your site. It helps you rule out what your problems are not, and identify what they are. If people are leaving the site immediately after landing on it, is your homepage not well-designed? Is your marketing getting it wrong and people are not finding what they thought they would at your site? Is the design of your site confusing or off-putting?
The problem could also be that your product descriptions are not good enough – it can be very hard, as the business owner, to be objective and put yourself in the shoes of a person who doesn’t know the product like you do. Sometimes if you are too close to the product it can be hard to describe it accurately, but if you fail to do so, you are asking people to take a leap of faith in buying it. To encourage a purchase, you also need to have a very clear returns policy – a free returns policy is also a way to encourage buying. This is a small gamble for the retailer,, but it’s unlikely to be used too much if you have been clear about the product description.
It’s all about making sure the customer is left with no questions.There is absolutely nothing stopping the customer from walking away when they are online – this is much easier to do when there is no-one in front of you serving you – so you have to eliminate people’s reasons not to buy. The aim is to leave no question unanswered. Anything that gives the customer pause to think is a reason for them to walk (or click) away. If a customer has to think, that’s the point at which you will lose them. Bear in mind though, that an FAQ section is not the way to answer their questions – it’s actually indicative of bad site design and product descriptions. If a question is frequently asked, it should have been answered within the content of the site.
Cart abandonment – when people don’t go through with a purchase
Cart abandonment is when a customer has been persuaded to buy but then, for some reason, does not go through with their purchase and leaves the payment process before completing it. This is often to do with the checkout process. It could be that it is confusing or unclear, or could be related to trust. Customers may wonder who the payment provider is, or whether the process is secure.
This can also be about being asked to register to make a purchase – the process for this may be too long and time-consuming, or it could be that people are reluctant to give out too many details online. You wouldn’t be asked to give these details when purchasing from a high street shop, so why should you have to when shopping online? Think carefully about which details you actually need from cutomers beyond the shipping and billing info, if any.
Shipping costs that have not previously been made clear are another common reason for cart abandonment. Being confronted with unexpected shipping costs at the purchase stage annoys customers, and because you’ve annoyed them, they’ll walk away from the purchase. Not revealing shipping costs until the last minute makes customers feel that you are trying to sneak them in, and that you are behaving as though the shipping cost is irrelevant – it isn’t. To the customer, the cost of the item and the cost of shipping are not separate - they have to pay all of it, so to them the combined cost is the cost of the item.
Any technical issues at the payment stage are also highly likely to make the customer abandon the purchase – these undermine trust and make the customer worry that they have already paid but won’t receive their goods, or have paid for them twice, or that their card details have disappeared into the ether.
Cost, and how to cut it
There is a perception that e-commerce is expensive to run, and while this can be the case, it doesn’t have to be. There is a lot of psychology around e-commerce, and the value of an e-commerce agency is their expertise in this, and how they apply it to site design. Companies like Amazon spend a fortune on this. But since the average cost for an agency to design your site is £300- £500 per day, this is not an option for many smaller businesses.
However, it is astonishing what you can get for little or no money. Sites like Shopify and Big Commerce offer hosted solutions whereby you pay a monthly fee for an “off the shelf” ecommerce site. You’ll get a fully designed, full featured site, following best practice. The service will handle customer reviews, imagery, security... basically everything.
Wordpress, the popular open source content management system, also has an e-commerce plug-in called WooCommerce, which gives you a fully-functioning commerce site. Other blogging sites offer similar functions, and then there are third-party sites like Etsy, Not On The High Street, Amazon and eBay, which allow users to set up shops with the design and functionality already in place. These are not as fine-tuned as your own site would be, so are not right for everyone, but they are a fraction of the cost, and you’re also getting the trust built in – customers already know and trust these sites. They could be an option for smaller businesses, or those just starting out or wanting to test the waters.
Trust, and how to build it
Trust is a major issue in e-commerce, as we have covered in previous points – it is an essential component in every part of the transaction, from honest product descriptions right through to secure checkout procedures. It’s a priority for consumers, so you need to give them a reason not to buy from the already-trusted large retailer, like Amazon. There are campaigns encouraging consumers to buy from smaller or local businesses online, but the fact is that the consumer trusts the giants; they know the product will arrive, they know it will be as described – these are the consumer’s concerns.
To compete with that, you need to describe products and your returns policy accurately. All the way through your site you must give the buyer absolute confidence in you.
Third-party validation is another very useful way to do this. You could post customer reviews on your site (making sure not to omit the two and three-star ones, as consumers value honesty), or you could use a third-party review site to do so like Trip Advisor, Feefo, Trust Pilot, Google Reviews or Yell.com. People respond well to these as they trust the opinions of other consumers.
• If you already have an e-commerce website and aspirations to increase domestic and international sales, or need practical support to get started internationally - either to enable your in-house development team, or to brief an external agency – Scottish Enterprise is running a series of freee-commerce workshops throughout Scotland in January and February. Register your place - http://www.scottish-enterprise.com/events
• This article was produced in partnership with Scottish Enterprise