Critical Mistakes That Will Kill New Online Startups
Statistic shows that retail e-commerce sales worldwide from 2014 to 2023 amounted to 3.53 trillion US dollars and e-retail revenues are projected to grow to 6.54 trillion US dollars in 2022. The e-commerce niche is a fast growing online business that is not yet saturated but certainly is getting fierce competition among all online retailers.
Wanting to starting a business takes courage even though it can be using up relatively small investment with proper financial planning. It is always good to stay alert to potential mistakes, and tackling them in advance to clear the path in thriving and achieving success. Here is a list of some mistakes that most likely will cause entrepreneurs to fail. It’s advised to tackle the challenge head on and to resolve the problem as soon as possible before it is too late.
Mistake #1: Taking A Niche You’ve No Interest In
By getting involved in niches you have no interest in, you risk failing. While success is possible if you’re the first one to monetize a certain idea, it’ll hardly work if you have to compete with other similar businesses. You risk competing with someone who’s eager to share his or her passion with customers, who deeply knows the subject and is inspired to come up with new ideas and approaches. Besides, doing something you like will make you keep trying despite any obstacles.
Mistake #2: Solo Leadership
A single person can quickly become overwhelmed by the responsibilities of running an online eCommerce store, especially if he is new to the industry. Unforeseen circumstances, such as family emergencies, health issues, and natural disasters can pull a leader away from work during critical moments, leaving the online store to flounder without direction. One leader is a single point of weakness for online startups, however if he has tools that can help manage online business while he is away or leave an offline message to set an expectation for potential customers.
Mistake #3: Cost of Advertising is Too High
In today’s eCommerce, competition can be great and thus advertising cost has increased over the years, leaving the overhead high, or the profit margins are going to be too small. Running a discount business or free gifts can likely attract swarm of target audiences, however proper cost management is pivotal to safeguard your ROI (return on investment) in the long run.
Mistake #4: Not Knowing Your Target Audience
Often people have way too general image on their target audience which may only rely on gender and age. However, other useful details about your clients including their marital status, profession, income level, interest, where they live, what they do on weekends, whether they prefer to use a PC or a smartphone, etc can help provide good reference in planing your advertising campaign.
Mistake #5: Lack of Plans and Goals
Online startups can fail if they don’t have a plan for the virtual store. When entrepreneurs come up with a business plan, they need to have strategies in place for when the business breaks even, hits goal, or falls short. A lack of understanding when it comes to short- and long-term goals can lead to lack of clear direction and eventually bringing their online presence out of no where.
Mistake #6: Choose Quantity Over Quality
Some online retailers prefer to offer as many products as possible, as they aim at broader target audience. However, promoting general stores is way harder than a niche store since the former has no clear target audience. It is especially important because you’re going to be alone and will have to do all the job on your own. So, it’s much safer to focus on smaller things, selling good quality products that you’re familiar with and dealing with several suppliers that you trust.
Mistake #7: Forgetting Measurements
Online startups that don’t watch their metrics can fall prey to risks that could have been easily avoided. Even if your store gains massive amounts of purchase, this success can be a moot point if you’re not watching cancellation rates and customer loyalty statistics. Online entrepreneurs must take a holistic approach to their business’s metrics to ensure success in the long run.
Try to avoid the above mentioned so you can too be successful in your eCommerce store.