10 E-commerce Challenges and Ways to Overcome Them

The e-commerce business is quite a profitable venture as, unlike traditional brick-and-mortar stores, it enables customers to do shopping at any convenient time and place orders without looking up from their mobile phones. However, this industry has a number of pitfalls you should be able to overcome.

In this post, we’ll discuss the 10 most common e-commerce business challenges so that you know how to turn them into great opportunities.

List of common e-commerce challenges

It’s impossible to foresee everything. But if you take time to consider these common problems in e-commerce, you'll be more likely to step on your way toward a successful online store. Forewarned is forearmed!

Explore the list below to familiarize yourself with these e-commerce challenges:

1. Growing competition. 
2. Increased customer expectations. 
3. Insufficient customer engagement. 
4. Low conversion rates. 
5. Shopping cart abandonment. 
6. Poor customer retention strategy.
7. Complicated process of product return & refund. 
8. Limited scalability options.

Understanding and preparing for these challenges will make your e-commerce journey smoother. Let's break down each challenge step by step, so you can tackle them with confidence and build a profitable online business.

1. Growing competition

Competition in the market is a fierce e-commerce challenge that entrepreneurs face. With so many businesses competing for customers' attention, it can take time to stand out from the crowd. Nevertheless, with a bit of strategic planning and creative thinking, you can make your business thrive in spite of tough competition.

Solution:

It’s a good idea to start crafting your strategy from competitor analysis. It allows you to identify the strengths and weaknesses of your rivals and adjust your strategy accordingly. Knowing what other businesses are doing regarding pricing, product offerings, marketing strategies, micromarketing and customer service will help you make decisions about how to position yourself in the marketplace.

Whatever product or service you offer, it must have top-notch quality so that customers will come back again and again. If there are already several competitors offering something similar to what you're selling, try to differentiate yourself by creating unique experiences such as special discounts or exclusive offers that no one else has. This could be an effective way to gain audiences who want to access experiences available only through your company.

2. Increased customer expectations

Keeping up with the ever-increasing customer expectations is energy intense but vital. With so many options available online, customers expect more from their shopping experiences than ever before. From personalized recommendations and fast shipping to seamless checkout processes and reliable service, customers now demand a lot from online retailers. And if their needs aren’t met, they won’t hesitate to go somewhere else.

Solution:

3. Insufficient customer engagement

Engaging your customers requires a careful balance between providing them with helpful information without overwhelming. It's like walking a tightrope: you want to keep your customers involved, but avoid giving them too much so that they feel bombarded. Finding this golden mean can be a tricky challenge in e-commerce, but when done right, lead nurturing can have huge rewards for your business.

Solution:

To build relationships with potential customers, you should provide them with relevant content at each stage of their journey toward making a purchase decision. You may start by segmenting your audience into groups based on common characteristics such as demographics or interests. Once you've identified these segments, create tailored messages for each group that provide helpful advice or resources specific to their needs rather than just trying to sell them something directly.

Additionally, use email outreach campaigns or push notifications to make sure your leads don’t miss out on any opportunities due to timing constraints or other factors outside of your control.

4. Low conversion rates

Convincing visitors to purchase something from your store is one of the biggest challenges of e-commerce. After all, there are a lot of other stores out there offering similar products and services. But how to capture customers’ attention and make them feel like they're getting a unique offer?

Solution:

Make it easy with user-friendly checkout. Don't let long forms and complicated payment processes stand in the way of converting those potential customers. Streamline your checkout process as much as possible by reducing the number of clicks to make a purchase, providing multiple payment options (credit cards, PayPal, etc.), and making sure all information is clearly displayed upfront before they hit the “buy” button. Make use of various e-commerce marketing tools to examine your website and obtain fresh perspectives for upcoming enhancements.

Everyone loves a good deal, so offer special discounts or loyalty rewards that will entice shoppers to make their purchases. This could be anything from free shipping, exclusive access to new products or even limited-time offers on popular items – whatever works best both for your business and customers. You can also embed a QR code with a logo which can redirect users to the checkout page with the coupon code already applied. It's very convenient for the users!

And, of course, use targeted marketing campaigns in order to reach the right audiences who may be interested in what you offer (check if the ads include relevant keywords too!).

5. Shopping cart abandonment

Let’s face the reality – from 59.2% to 79.8% of shoppers abandon their online carts, which results in lost revenue for many companies. Whether it is the lack of trust, high shipping fees, or complicated checkout processes – cart abandonment stands among the most complicated e-commerce problems.

Solution:

Ensure that all elements within your website or app navigation system work properly so visitors don’t get stuck. As highlighted above, a streamlined checkout process without filling out unnecessary fields helps your customers not to get stuck or simply give up. And make sure buttons like “add item/product” are clearly visible throughout each page so users know exactly where they should click when they’re ready to make a purchase.

6. Poor customer retention strategy

Any marketer would agree that retaining customers involves creativity and a well-thought plan. It’s not enough to just get people to your store, you need them to come back and make repeated purchases. But don’t worry, achieving a steady stream of returning customers is a crackable e-commerce challenge.

Solution:

7. Complicated process of product return & refund

Product returns are a usual thing in e-commerce so be ready to deal with this e-commerce challenge wisely. Sometimes it’s difficult to keep track of all the returns, refunds, and exchanges that customers make on their purchases. But your duty is to provide an excellent shopping experience and keep the business financially viable in the long run.

Solution:

The best way to overcome this e-commerce challenge is to have clear policies from day one. What types of returns are allowed? How should they be handled? Be sure to include detailed information such as time limits, return shipping costs, restocking fees, etc., so customers know exactly what they’re getting into when making a purchase from your e-commerce store.

In addition to setting up clear policies around product returns and refunds, it’s important not to forget about customer service too. Make sure you provide prompt responses when dealing with inquiries or complaints related to returning items. No one likes waiting for days or weeks just for an answer!

Finally, don't forget about providing incentives like loyalty programs or discounts on future orders. This helps to build trust over time as well as encourage more sales too.

8. Limited scalability options

Scalability is one of the most essential factors for e-commerce success. How often can you release new features and content? Do you have the resources and technology such as headless commerce to scale up quickly? You need to have a solid plan on how your business will grow over time without sacrificing quality or customer satisfaction.

Solution:

Adopting an agile approach is a great solution for this e-commerce challenge because it allows you to quickly adapt and respond to customer needs. If you’re responsive and innovative in your vision, you can longer stay competitive in an ever-changing market.

One of the ways to go agile is to invest in automation. Automating processes like inventory management, query processing, and email marketing, can help you speed up operations while reducing manual errors. This will save time, money, and energy so you can focus on other aspects of growing your business instead of worrying about mundane tasks taking away productivity levels.

Also, keep track of key analytics metrics to identify areas for improvements faster. By using analytics tools like Google Analytics, you gain invaluable insights into customer behavior and address their needs more efficiently.

9. Data security gaps

In today’s digital world, data security is among e-commerce problems that can’t be ignored or neglected. With the rise of online stores, issues such as data breaches and identity theft have become major concerns for customers. As an e-commerce business, it’s your responsibility to ensure that customer data is safe from malicious actors.

In fact, the demand for robust data security is among the growing trends in mobile app development nowadays in 2023. Wondering why? Discover more.

Solution:

There are steps to overcome this e-commerce business challenge and guarantee that your customers feel secure when shopping with you:

By taking these proactive steps, you can reduce the risk of becoming a victim of cybercrime while increasing customer confidence.

10. Challenging search for a reliable tech partner

Finding a reliable software development company for your e-commerce business can be an overwhelming task and one more challenge. With so many options out there, it can be hard to know who can handle the critical task of creating an e-commerce application that works for you and meets your customer's expectations.

Solution:

Conduct thorough research of companies, take the time to read reviews, and view their portfolio. You can also interview their past or current clients about previous work they've done in order to get an idea of what kind of results they could bring to your company.

At SolveIt, we have vast experience in partnering with clients from the e-commerce domain. Our dedicated development team consists of highly-skilled professionals who can guide you through the entire e-commerce app development journey, from idea formulation to mobile app launch. Don’t hesitate to contact us for more detail.

Bottom line

With a better understanding of the main e-commerce challenges, you'll be able to tackle them ahead and take advantage of all the opportunities available in today's digital landscape. If you have the development of an e-commerce mobile app on your agenda, drop us a line – we’ll be happy to assist.