Supply Chain Management E-COMMERCE Notes

 Supply Chain Management in e-Commerce

   Running an e-Commerce business is not just confined to setting up a digital store and selling products online. It also includes managing a whole lot of other essential components such as logistics, product configuration, infrastructure, secured payment gateway, and supply chain management. We will be discussing all these components in detail in our upcoming topics.

   While there are a number of activities running parallel in the backend, following are the key areas of focus for supply chain management in e-Commerce:

1. Raw material procurement
2. Managing demand and supply
3. Inventory tracking
4. Manufacturing
5. Distribution and delivery of the right product to the customer
6. Order management
7. Order entry

   A systematic and well-organized supply chain speeds up pretty much all the major e-commerce operations and distribution processes ensuring that the customers' expectations are constantly met.

What is a Supply Chain?

 Consumers today utilize products/services more than ever and everything and everyone that is involved in getting those services and products to the consumers go into a supply chain. These include resources, a system of activities, organizations, information, and the people involved.

   Let’s understand this with a simple example. Consider fresh apples! For these apples to arrive at your breakfast table, a plethora of activities, transactions, and people are in the motion at the backdrop. All these are connected through the internal chain and are involved in planting, cultivating, delivering, and consuming apples. The internal chain connecting people, establishments, and activities ensures a timely delivery of apples to your doorstep.

   Besides the proper flow of physical products like apples, a well-structured works the same way while availing virtual elements such as information and communication.

  These related activities, functions, people and organizations when together make a supply chain, which comprises four primary activities including production, sales, distribution, and fulfilment process. Essentially, the supply chain is a value chain. To attain maximum value, every member of the chain must coordinate and carry out its function efficiently.

What is Supply Chain Management (SCM)?

   The supply chain is what keeps your business running competently. A proper supply chain management ensures an efficient movement of raw materials and optimized finished goods inventory. It offers an oversight from the point of production to getting goods in the hands of the consumer.

   Simply put, supply chain management refers to a spectrum of activities that are required to plan, control, and execute procurement, manufacturing, and distribution of the goods to the end consumer.

What are the Benefits of E-commerce Supply Chain Management?

There are an estimated 12 to 20 million e-Commerce businesses as of today, with more being created every day. This has led to a surge of competitiveness among e-Commerce businesses. For long term success, businesses not only require a user-friendly e-Commerce platform but a well-connected supply chain as well.

e-Commerce supply chains do not operate in silos. For them, proper supply chain connectivity during the entire process, from procuring to delivering, is necessary to generate more leads, build relationships, and grow sales.

With a pandemic looming at large, we have seen strong demand for e-Commerce and online retail goods over the past few months. The aftermath of online shopping skyrocketing has laid the foundations for a whole new buyers’ journey and the sellers have to adapt to the rising demands and increasing expectations of the consumers. However, during the lockdown, many sellers saw long delivery delays, higher-order cancellation rates, and were stuck with dependencies from single logistics providers and services from Amazon. These findings reveal a good understanding of what has been happening to supply chains and distribution. As a result, merchants and e-Commerce businesses of all sectors need to find some reliable supply chains and logistic partners to deliver their products on time.

The following are the major advantages of supply chain management in e-Commerce:

Visibility across the entire network

Supply chain management brings transparency in the network and helps oversee the status of all the activities happening across supply, production, warehousing, and distribution. This ensures a more comprehensive tracking and management of all processes from procuring to shipping of finished goods to the end consumer.

Enhanced Customer Relationships

Effective supply chain management ensures on-time deliveries, which makes a direct impact on strengthening customer relationships. Furthermore, SCM aids the brands to keep an eye on customer requirements. It makes sure that the business is attuned to the changes in the demands of the products and services. An e-Commerce integrated supply chain helps businesses get feedback and requirements about their products directly from the consumers.

Cost reduction

One of the principal reasons due to which the customers invest their time and money in e-Commerce is reduced costs. Probably, there are a lot of areas where business invests more than required. Some of such areas could definitely be streamlined. It’s worth taking a look at your supply chain to recognize areas where the costs could be cut down.

e- Commerce based SCM can significantly reduce costs in the supply, production, and distribution processes, which, in turn, leads to higher profits.

Minimized Delivery Delays

Delayed shipment from vendors, holdups during production, and logistic errors in distribution channels massively impact brand reputation in the market. With an effective SCM, all activities can be coordinated and executed from top to bottom. Minimizing delivery delays can prevent losing out on business and streamline your image and relationships with the customer.

Scaling omni channel practices

A well-structured supply chain management in e-Commerce facilitates omni-channel engagement that ultimately leads to increased customer engagement on all major platforms.

e-Commerce businesses in an omni channel environment pretty much conclude the new shopping touch points of the majority of consumers today. It is incredibly crucial for brands to consider customer convenience and expectations first. And, it starts from the very first step of the supply chain. An adequately managed e Commerce supply chain assists brands with an omni channel scaling of their businesses and expands their selling horizons with content customers spread across channels.

End-to-End Supply Chain Self-Assessment

Determining the best practices for your e-Commerce business starts by assessing and auditing your supply chain management and warehouse operations.

To come up with best practices, first assess your distribution center’s processes and costs, then ask yourself these following questions:

Will you keep stock?

How will you ship to the customers in limited time and expense?

The quantity you will be dealing with on a daily basis

Will to resell or manufacture your items?

How much are you willing to spend on labor in your warehouse?

The answers to these questions help you determine the best approach for a capable supply chain model for your e-Commerce.

Best Practices for Effective Supply Chain Management in e-Commerce

How can you prepare your e-Commerce business to avoid supply shortages, shipping delays, excess inventory, and still maintain fully functional products for the long run? Besides doing our own reports from external market insights and analysis, we dug even deeper and consulted with the logistics network of several established businesses to learn from their experience. Based on this intense analysis, we came up with five best practices and learning that will help you to harness and maximize your business values in the short- and long-run.

Here are the following takeaways for managing an e-Commerce supply chain:

Diversify and use Flexible Warehouses as well as Suppliers  

Having a central distribution point from only one provider creates a dependency that might shake up your business if anything goes wrong.  It is always a good idea to rely on multiple suppliers and a higher number of locally maintained distribution points. In case anything goes wrong with one of your suppliers, you can easily source products from a different supplier.

For example, Nykaa, an online cosmetics company co-operates with other cosmetic brands and attracts high-quality suppliers to sell their products on their platform. When a customer places an order on Nykaa, it might be picked from Nykaa's warehouse or another supplier's warehouse. Doing this will ensure you don't have to worry about your business and still retain your customers.

Improve your Sales Forecasting

With an increase in demands, products are going to be moved from one location to another. To meet these demands, e-Commerce businesses make the mistake of increasing their inventory drastically. At this stage time as well as sales forecasting is very critical.

Buying too much inventory would mean creeping costs, obsolete stock, and additional overload in the form of warehousing. As a merchant, using real-time data transparency will help you to control supply chains and react timely to changing demands.

By using a proper sales channel and management system, you can optimize their supply chains and stocks by receiving direct notifications when their supply reaches minimum thresholds.

Leverage and Embrace Supply Chain Software

Knowing that there are multitudes of tools to manage supply chains is good, but not taking advantage of them is like shooting yourself in the foot.

You can use various software dedicated to handling supply chains that can properly track and manage your inventory, process orders, manage suppliers, and more. Having said that, you can also use inventory management software like EasyE-com to handle these operations and manage your B2B processes. Technologies such as data analytics, big data, warehouse management systems as well as inventory and logistics management can help you to increase your supply chain efficiency.

Alternatively, you can also pick a single platform such as an ERP system like SAP, Oracle, Navision, etc.  to manage most of the activities under one roof. This will support you to deliver your orders faster with a lesser chance of making any errors.

Decrease Processing Time by Managing Labor Effectively

Making use of barcode technology for warehouse systems and automation will gain efficiency in material handling, storage, product flow, and labor productivity. Try to implement barcode technology in areas such as picking, packing, receiving, put away, shipping, returns, labor tracking, and replenishment. If you don't achieve a favorable outcome on applying such technology automation, shift your strategic goal to managing labor more effectively.

Embrace Drop Shipping for your Ecommerce

In simple words, drop shipping is referred to as finding low-cost products in wholesale and selling them at a higher price. So essentially, you find and procure products from a supplier with a low wholesale price. You then place that product in your store with a higher retail price. It is a very popular practice on e-Commerce platforms like Amazon, eBay, and Shopify.

Amazon’s drop shipping model is quite simple to understand and practice. When a consumer shows interest in a product you’ve listed on Amazon, wait for the transaction to finalize and then buy this product directly from the supplier after you receive the funds. You then provide the consumer information to the supplier and then they send the product to the consumer on their own.

Benefits of drop shipping:

Keeping stock or buying inventory not necessary

No prior redundant investment in stock

Takes lesser time for delivery

Add or change your range of products without any risk or investment

Set up a start-up store at a low cost

However, finding reliable suppliers and quality products is the hardest part of drop shipping. Using drop shipping wisely can be the real revolution of your e-Commerce business.

Outsourcing to 3PL and 4PL

Using 3PL and 4PL companies like UPS, DHL, Deloitte to optimize your supply chain management (SCM) is fairly common yet one of the most effective e-Commerce supply chain management strategies. A 3PL company can enhance your customer service offerings with its already established distribution network or you can choose to go to a 4PL company that could offer you the best supply chain management solution for your e-Commerce business using 3PL providers.

The logistics functions that can be outsourced may vary from business to business but they usually involve warehousing, distribution, and order fulfillment. Handling these activities constantly can be a daunting task and can get unmanageable for more complicated and critical supply chains.

Implementing a Management Software

Forget about e-Commerce supply chain management strategies, investing in management software is always a good idea for a growing e-Commerce business. An inventory management software, a WMS, or an OMS automate a lot of crucial business operations that you can’t do manually, and supply chain management is one such operation. Although, optimizing it requires much more than an automating software, implementing one is still a step in the right direction.

Product Digitization 

Product digitization means adding the digital capabilities to physical products so that product buyers can interact with the product and get information in digital format. It is achieved by putting scannable codes on the product or product packaging. Buyers can scan the code using their smartphones and access the product information on their phone screen. Product digitization converts physical products into digital gateways to convey the right marketing message at the right moment.

Benefits of product Digitization

Digitizing any aspect of business helps you to collect more and more of business data. Similarly, product digitization helps you to collect the data of all the stakeholders involved in the product’s journey. And data has become the foundation in taking any business to the path of success.

The increasing number of smartphone users and the capability of scanning the QR codes through the native camera in iOS and many Android phones, has made QR codes very popular.

From making payments to checking into events, QR codes are being used everywhere, and millennials prefer to scan these codes to do things faster and error-free. This popularity of QR codes makes placing QR codes on product items, a very efficient and economical way of product digitization.

Following are the key benefits of product digitization:

Generate Trust in Consumer’s mind with Product Journey and Story – Brands can show product journey and story on the scan of product code; this helps in increasing customer’s trust in the brand.

Convey dynamic information to your users – Product digitization presents an opportunity to show dynamic content to the users without the need for change in the product codes. For example, Brands can display information in regional languages based on the scan location. Brands can also showcase new/related products on the product information page.

Collect and access product interaction information in realtime – With the help of product digitization, brands can collect user data in realtime, and this data can contribute to making crucial business decisions. Product digitization also enables products to participate in marketing automation.

Protect your brand against counterfeiting – Product digitization can protect your products fro counterfeiting if the product codes are clone-proof.

Enhance your supply chain visibility and prevent diversion – The same product codes can also help in supply chain management and preventing the diversion by flagging any anomalies in product code scan geo-location if the backend software platform is equipped with such capabilities.

Customer engagement – Product digitization opens new channels to engage users. Product codes can be used to run loyalty programs and re-engage the users for repeat sales. 

Good for the environment – Another very important benefit is that product digitization helps brands to go greener by helping them to save paper on printed media.

Remote Service

Remote service in the standard context refers to a technician using software/hardware to access a client’s devices offsite, in order to provide maintenance and support. These services could include installing updates, security patches or troubleshooting other issues.

An example of where this type of service is employed in the factory context, is when software from the ERP and MES systems are upgraded remotely. Utilizing remote access and services for standard IT related queries is fairly commonplace. All an offsite technician needs, in order to perform remote service is an internet connection, and remote access software installed on both the technician’s device and the client’s device.

A remote service is a process that resides outside of the application server and provides a service to the application. An example of a remote service is a web service, message queue, or caching server.

Remote service software is used by equipment manufacturers to remotely monitor, access and repair products in use at customer sites. It is a secure, auditable gateway for service teams to troubleshoot problems, perform proactive maintenance, assist with user operations and monitor performance.

What is ecommerce marketing?

Ecommerce marketing is the act of driving awareness and action toward a business that sells its product or service electronically.

Ecommerce marketers can use social media, digital content, search engines, and email campaigns to attract visitors and facilitate purchases online.

Before we dive into more detail about what ecommerce marketing is and how to implement a strategy of your own, let's review the definition of ecommerce advertising and advertising's parity with marketing for an ecommerce business.

Ecommerce Advertising

In similar fashion to the way advertising falls beneath the umbrella of marketing, ecommerce advertising falls beneath ecommerce marketing — and when used in tandem, you have the ability to more effectively reach your audience members to boost conversions and improve brand awareness.

As mentioned in our definition above, ecommerce marketing is about driving awareness and action towards your product or service.

Meanwhile, ecommerce advertising includes the methods through which you actually promote your product. In terms of online or ecommerce marketing and selling, these ads may come in the form of display ads, banner ads, or rich media ads.

The main takeaway here is that ecommerce advertising is a highly-effective method to implement while developing your ecommerce marketing strategy to focus your product or service promotion.

Now, let's get back to our in-depth discussion about ecommerce marketing.

Types of Ecommerce Marketing

To give you a sense of what an ecommerce marketing strategy looks like, here are some common marketing channels and how you'd use them to build an online store.

Social Media Marketing

Brands, publishers, contractors, and growing businesses all launch pages on today's most popular social networks to connect with their audience and post content that the audience is interested in.

As an ecommerce marketer, you can do the same thing, but the campaigns you run might look a bit different, and not every social network is a good fit for your needs.

Ecommerce websites are highly visual — you have to show off the product, after all — so your success on social media depends on your use of imagery to drive attention and traffic to your product pages.

Instagram is an appropriate platform for ecommerce businesses because it enables you to post sharp product photography and expand your product's reach beyond its purchase page.

You can take your social media posts a step further by creating shoppable content, which is content that enables visitors to buy right away. That can include anything from strategically placed display ads within a social feed to additional tags that take users directly to a shopping cart. These methods help you eliminate friction from the buying process.

An ecommerce business is no stranger to product reviews, either. Using a Facebook Business Page to share product praise is a perfect fit for businesses that already solicit customer reviews across their online store. We’ll dive deeper into product reviews below.

Content Marketing

When you hear "content marketing" you might think of blogging and video marketing — content that is meant to improve your website's ranking in search engines and answer questions related to your industry. But if you're selling a product online, do you really need articles and videos to generate transactions? You sure do.

Here are some ways to use content to market your ecommerce store.

Optimize your product page copy.

Optimize your product pages for short, product-driven keywords that include the name of the product. If you sell wedding dresses, for example, a Google search for "brown bridesmaid dress" is more likely to produce product pages like yours if you’ve included that term on the page.

Also, make sure that your page titles, headers, and image alt text focus on the right keywords so search engines know to return your ecommerce store for the right query.

Write relevant blog posts.

If you manage an online wedding dress store, writing blog posts about "how to plan a wedding" can attract everyone involved in wedding preparations no matter where they are in the planning process.

As visitors become more engaged, you can create posts that will move them into consideration, like “how to select the right wedding dress", and turn them into leads, like a downloadable “wedding planning checklist”.

Create guest posts for external websites.

Guest posts can get you and your products in front of relevant audiences (oftentimes for free). Submitting guests posts will also help you get more domain authority for your ecommerce site, thereby telling search engines that you have a reliable site.

You’ll need to search for sites that rank for keywords related to your product. Sometimes you won’t even need to create an entire post. If a site already has a relatable post, offer to expand on it by providing additional context, like a video or infographic with a link to your site.

Put product-related videos on YouTube.

YouTube has over a billion active users … chances are your target audience is somewhere in there. It’s also the second-largest search engine behind Google. If you’re looking for a massive, captive audience, YouTube is where you’ll find it. Use highly searched keyword terms to determine your topics, then share videos that are related to your product and helpful to your audience.

This is also a great option for tutorial videos that show current customers how to use your product — these videos can show people how best to use your product, increasing customer satisfaction and building long-term relationships with website visitors.

Search Engine Marketing

Search engine marketing (SEM) includes both search engine optimization (SEO) and paid advertising. While SEO relies on your knowledge of Google's ranking algorithm to optimize content, SEM can involve pay-per-click (PPC) campaigns, display campaigns, or product-specific ad campaigns (think Google Shopping), which allow you to pay for top spots on search engine results pages.

On Google, PPC campaigns guarantee that potential buyers will see a link to your page when they enter search terms that match the terms of your campaign. But because you're paying Google each time a person clicks on your result, the payoff to you should be high.

This is why ecommerce marketers often register with Google AdWords and promote their product pages through PPC campaigns. The campaign puts searchers right in front of the business's product when they click on a paid result, increasing the likelihood that the searcher will make a purchase before leaving the business's website.

Email Marketing

Email marketing is one of the oldest forms of digital marketing, and believe it or not, it holds specific value in the world of ecommerce marketing.

The best part about email marketing? It can be automated. Automation means that you can set up a successful drip campaign to subscribers that are segmented by interest or stage in the buyer’s journey and  let your email campaign do its magic. It’s one less marketing tactic that you need to worry about on your long list of tasks.

Even so, it’s imperative that you’re meticulous about your email list so you maintain trust among your leads. In a time when data privacy runs high on an internet user's priority list, not every commercial email is welcome in that user's inbox. Ecommerce marketers need to be careful when and how they add website visitors to their mailing list.

Here are two ways an ecommerce marketer might use email marketing.

1. Post-Purchase Follow Up

If a user has already purchased a product from your website — and agreed to receive emails from you during the checkout process — sending a follow-up email a few days after the product is delivered keeps the conversation going and gauges their future interest in your product line.

A post-purchase follow up also shows that you care about them beyond a sale and that your company has an interest in their success using your product. It gives you an opportunity to get feedback on their purchase experience, which, in turn, helps you reduce friction for future customers.

Some best practices for this type of email are to ask them to write a review of your product and/or read original content on how to use your product (those YouTube videos you created would be perfect here).

2. The Abandoned Shopping Cart

Users abandon their shopping carts for a number of reasons, and emails to diagnose the problem and retain their business can make the difference between a purchase and a lost customer. We’ll cover ways to reduce shopping cart abandonment below.

If a website visitor fails to complete a transaction while they’re in your shopping cart, consider sending a polite email to remind them to complete the checkout process, offer assistance, or recommend other related products to get their mind back on you and their browser back to your ecommerce store.

Influencer Marketing

Influencer marketing focuses on people or brands that influence your target market. The term is commonly used to denote Instagram accounts with several thousand followers, but it could also mean a celebrity or community that your target audience follows or belongs to.

Influencers build communities of people that know, like, and trust them. It is, therefore, easy for them to garner attention around your online product through a recommendation, or “sponsored post.”

Affiliate Marketing

81% of brands employ affiliate marketing, and ecommerce sites are particularly good candidates. Affiliates are people or businesses that help sell your product online for a commission.

Unlike most social media influencers, affiliates generate interest in products via old fashioned (yet effective) marketing tactics. They often use paid advertising, content marketing, and other means to drive traffic to your their pages on your product — it’s like having a team market for you.

Local Marketing

This is an often-overlooked tactic for ecommerce businesses, but local marketing allows you to double down on the areas where most of your prospects are (if you have a large population of them in one area) and allows you to offer incentives to your potential customer base.

Here’s how: use tracking cookies to determine where your prospects are located. Then, offer discounted (or free) shipping to potential customers in the areas where you have warehouses or shipping facilities. The incentive might be just what you need to gain a new customer.

Ecommerce Infrastructure

In the changing world, there is a necessity to improve the business requirements according to the changing needs of technologies, trends in the market, and customers. 

Whether you are new to ecommerce or already into ecommerce, your major priority is to increase the overall efficiency of the organization. When you want to improve efficiency, you must have a strategy and the right infrastructure to address the needs of the user and flexible enough to satisfy their requirements. 

Infrastructure is the foundation that makes your business stand out. Ecommerce infrastructure is a collection of hardware, software, network, facilities, etc. that you need to run an ecommerce business. When you have the right infrastructure, you will have an optimized business performance. Here are some important components that you must consider while planning your ecommerce infrastructure. 

Ecommerce infrastructure categorization 

1. Ecommerce environment: This defines general guidelines and frameworks that will make your business suitable for running ecommerce. It is a standard like technical tools, legal and regulatory frameworks, and the involvement of service providers.

2. Infrastructure services: These are the services that specify ecommerce functions. One or more services will work together to provide particular functions to the ecommerce business. Services like user authorization, payment processing, order validation, etc., help in during products checkout by the user.

The infrastructure services can further be classified in terms of the services they provide to the user or an organization. Network services, directory services, payment services, and security services are common infrastructure service providers to the user. 

3. Ecommerce solution providers: They offer an end-to-end solution for ecommerce business who does not have their implementation team.

Ecommerce infrastructure components 

Ecommerce infrastructure identifies each functionality of the hardware, software, and network with their key role. When you know about the functionality of the components in ecommerce, then you can organize the ecommerce platform more efficiently. 

Hardware:

Hardware does several things, which includes allowing you to connect to your network and have access to the outside world. It allows you to store data, recover and use your data. Some important hardware components are: 

Devices: Computers, hubs, routers, data centers, etc. 

Servers: Server provides the necessary functionality for other programs. It can be a computer program or a device and can be used for different purposes. Some common servers are a proxy server, web server, application server, etc. 

Software:

Software components include services like system management tools, analytic tools for estimating your business and service providers. 

Management services: When you run an ecommerce business you need to manage various services like content, database and resources. Enterprise resource planning, content management, and data centers are some software services that help in managing the resources of the company efficiency. 

Analytics: Ecommerce business is more competitive since it is growing day by day. So, it's important to analyze your capacity, which helps in improving your system to perform better. Web analytics and text analytics tools will help in estimating your ecommerce site. 

Middleware: Middleware is an intermediate between service providers and service users. It could be data access for components, communication protocols, specialized servers, or a mix of all. 

API: An application program interface is a protocol or a tool for building the software applications. It specifies how a software component should interact with each other. 

Network: 

Network provides the communication path and services between users, processes, applications, services, and external networks through the Internet. 

Internet connectivity: Establishing the connection between various devices and processes.  

Firewalls: Firewalls protect your networks from outside attackers. It enables you to specify what kinds of traffic are permitted through, adding a layer of security. 

Security services: Even some times firewalls may lack in protecting against the hackers including security services. 

Load balancer: It uses load balancers to distribute the overall load on your web or application servers. It also distributes demand according to the kind of task to be performed. 

DNS: Domain Name System is naming a system for your website. They locate the internet protocol address for your domain name. 

Criteria for choosing ecommerce infrastructure 

Choosing the right infrastructure to match your ecommerce business strategies enables your operations to run efficiently and increase your revenue. 

Flexibility: An ecommerce environment must be easy to manage for all users. They must have the ability to respond quickly for all the changes and must adapt the new technologies and features as a scalable factor. 

Usability: Usability is an important factor while you are choosing the services for ecommerce platforms. When any one of the services fails, it will cause a major effect in delivering efficient performance. 

Scalability: Ecommerce grows rapidly where new technology and services get added regularly so it needs to have an environment that does not collapse during additional services. The infrastructure should be scalable in terms of technology, human recourses, high traffic, etc. Also, the performance of the system should not be slowed down. 

Security: Ecommerce business is vulnerable to various sources like hackers, malware, security attacks, etc. Your infrastructure must allow firewalls to protect your ecommerce from network attacks and other paid security services. 

Effective planning and management 

As an ecommerce business owner, ignoring the importance of planning and developing an ecommerce infrastructure is a major failure for a business in the long run. You need to have an infrastructure based on the needs and priorities of your company. Even managing your ecommerce infrastructure is challenging, but well-defined planning and management can reduce risk and ensure uptime.

Ecommerce Challenges

1. Cyber & Data Security

When it comes to eCommerce, one of the biggest challenges faced is security breaches. There is a lot of information/data that is involved while dealing with eCommerce and a technical issue with data can cause severe damage to the retailer’s daily operations as well as brand image. 

2. Online Identity Verification

When a shopper visits an eCommerce site, how would the retailer know if the person is who they say they are? Is the shopper entering accurate information? Is the shopper genuinely interested in the eCommerce products?

If you do not have the accurate details or information, how do you proceed? Well, it does become tricky. The solution would be to invest in online identity verification.

3. Attracting the Perfect Customer

Shoppers have a myriad of options to choose from these days. If they are looking to buy a handbag, they do some thorough research before finalizing on one. If shoppers have several options, how do you make sure they pick you? How do you go about finding that perfect customer that wants your product, at your rate and to the places you can ship?

4. Customer Experience

Customer experience or user experience is key to a successful eCommerce website. Shoppers expect a similar if not same experience as one they would get in a brick and mortar store. The flow of the website, the segmentation of the website and the retail personalization of products based on the shopper’s preferences are imperative. 

5. Customer Loyalty

Here are two facts that show the importance of customer loyalty:(a) It can cost up to 5 times more to acquire a new customer than retaining an existing one and (b) the success rate of selling to a current customer is 60-70% compared to only 5-20% success rate of selling to a new customer.

The above two facts are testament to how important customer retention or loyalty is. Once a customer makes a purchase or utilizes a service from a retailer, they have to make sure that they keep this customer for life. But how is this possible?

6. Converting Shoppers into Paying Customers

One of the biggest ecommerce challenges is to convert visitors into paying customers. An eCommerce website might have a lot of traffic, a lot of clicks and impressions but they aren’t making the sales they anticipated. What can they do to get more sales?

7. Competition & Competitor Analysis

Have you heard of a Jam Experiment? Well it has quite a controversial conclusion, which is – the less you offer customers the more likely they are to actually purchase something. A lot of people these days are fatigued by all the options that are out there. A simple search (personalized search) for something like headphones will give you thousands of options – how does one make a choice? 

From a retailer’s standpoint, how do they stand out from the crowd? How do they bring shoppers to their website, instead of buying a similar product from their competitors?

8. Price & Shipping

We have all heard of customers that prefer to purchase products from places that have free shipping. eCommerce giants like Amazon provide such attractive shipping deals that customers seldom want to look at other places. How does one bring down costs for shipping? 

9. Product Return & Refund Policies

According to ComScore, more than 60% of online shoppers say that they look at a retailer’s return policy before making a purchase. When an eCommerce site says “no returns or refunds” it makes a shopper nervous and less likely to trust the retailer. When shopping online, customers want the flexibility of making a mistake that doesn’t cost them. 

10. Choosing the Right Technology/Partners To Fix Your eCommerce Challenges

Choosing the right technology or partner will make or break your business. A retailer’s growth might be stunted because their technology is limiting them or because they have hired the wrong agency to help them manage their projects. 

There are a lot of aspects that need to be in place for a successful retail business, but a good technology foundation is crucial. 

11. Customer Support 

With the scale of eCommerce increasing rapidly and with the rising number of users facing everyday issues with eCommerce services, Customer support has been augmented with chatbots which enable faster processing and response to tickets. However, many customers find themselves feeling uncomfortable or dissatisfied with automated responses from chatbots.

12. Cross-border eCommerce

A lot of eCommerce sites tend to stagnate due to the lack of interaction with customers outside their geographical and linguistic range. Users that do not speak the primary language used on the site tend to look for other retailers that can offer them a better user experience. Moreover, the differences in pricing, tax rates, etc., deter users from purchasing across borders.

13. Marketing Budgets 

With digital marketing becoming the norm for most eCommerce businesses, more companies are flocking towards their digital and social media ad spends. With the demand for clicks and virtual advertising space increasing, so does the price. This can become very expensive for small and medium-sized retailers and in fact, this is one of the biggest eCommerce challenges that they face.

14. Going Omnichannel 

Selling your products through multiple channels enables you to increase your overall revenue and Average Order Value(AOV). A customer that shops on multiple channels is likely to spend three-times more than the average customer. However, if not done right, some channels might lead to losses if they don’t attract the right customers and the required volume of customers.

15. Data Privacy

Customers today are aware of the importance of their data and the need for data privacy. Device manufacturers like Apple are going the extra mile to ensure that their users’ data are kept safe from third-parties. However, user data can also enable platforms to provide them a better user-experience. 

16. Logistics

Companies across the world are affected by supply chain issues every year, and considering it is a layered process, issues and errors occur at multiple steps during the process, which leads to added expenses and delays.

17. Store Agility

How rapidly can you roll out new features, post and market fresh content? Due to the rapid evolution of ecommerce, it is crucial that you implement an agile company model. Staying relevant and up-to-date with trends is crucial for eCommerce businesses to survive and thrive and provide their customers the best possible user-experience.

18. Customer Expectations 

Modern consumers these days are increasingly informed and aware with the advent of new technology and exposure to multiple brands and services. The modern consumer has high expectations for the kind of products and services they pay for and are constantly on the lookout for better experiences. 

19. Placement of Elements within your page

This might come across as surprising – but the design and placement of important elements such as the navigation bar, tabs etc., on your website can significantly impact your conversions and sales because your user-interface contributes to the customer’s experience on your site. Users tend to be wary of sites that they cannot easily navigate through 

20. Sustainability 

Retailers are now being incentivized to market their goods and delivery services as having a low environmental impact due to the increased global attention on sustainability due to consumer demand. Nearly 60% of consumers are ready to alter their purchase patterns in order to lessen their impact on the environment.