With a new year comes new and interesting challenges. Any business knows first-hand that the number of obstacles in any given business climate can make or break those who are not prepared to deal with them. Whether it relates to customer service, competition, technological upheaval or something entirely different, rising to the challenge is essential for brands that wish to continue operating and succeeding.
Online storefronts understand these challenges all too well. Without constant vigilance and optimization, online stores can be easily threatened by competitors, out-flanked by market conditions and otherwise rendered irrelevant by technological changes.
In 2018, many of the same challenges online storefronts have been facing will return once more, but there will also be some new problems to face if you’re selling products and services via the internet. If you want to know what to expect, then keep reading to discover what awaits your online brand this year.
Cart Abandonment
As more online retailers compete with each other in search engines, on social media and in inboxes, potential customers have a variety of choices. For the vast majority of products and services on the market, shoppers have plenty of different store fronts to consider buying from – this creates problems.
One of the biggest reasons why this is bad for business is that it often leads people to walk away from their shopping carts on a particular website. While somebody may add one or more items to a store’s cart, they more often than not leave the website without making a purchase. The pain of cart abandonment is real, and worst of all, most people who abandon their carts never return.
The good news is that online brands can minimize this impact in a couple of ways. The first way to minimize losses is to send reminder emails to those who have signed up on your website and who have since abandoned their carts. Another method – which potentially conflicts with the first – is to require account registration only once somebody is fully committed to purchasing. This means not hiding shipping costs and other vital checkout info behind a wall that requires registration. New conversion technology is also being introduced from companies such as OptinMonster. Their cart abandonment software has features that includes timed popups, page level targeting and exit intent technology to help reduce cart abandonment.
Loyalty
In an age where information flows around the world in the blink of an eye, the old traditions of loyalty for most businesses have long since passed. For online brands in particular, this presents a unique challenge in that anybody can easily find dozens of competitors who offer the same products and services – and at a better price, in some cases.
Online storefronts in 2018 must work diligently to craft loyalty among existing consumer bases in order to maintain a stable bottom line. This is why so many brands have shifted gears from direct product promotion to brand cultivation. You may have noticed other competitors sharing seemingly random, entertaining content on social media. Perhaps you’ve seen emotional stories and personal pleas from brands that attempt to tie an emotion to the brand itself.
These efforts help humanize a brand. Likewise, many businesses are discovering that the number one factor in maintaining loyalty in a hyper-globalized market is to provide excellent customer service and consistent community engagement. The brands that can manage this will be well-positioned for surviving the loyalty deficit that is becoming stronger among customers with each passing year.
Product Exchanges
Even once the sale is complete, there is no guarantee that an online storefront won’t face struggles with the customer. Due to an unprecedented amount of mail delivery and the strain on mail carriers, the number of damaged packages on arrival continues to increase. This creates headaches for buyers and sellers alike, but it is only one example of the broader problem.
Online storefronts must also deal with picky and/or malicious customers who either want to cause trouble or who just can’t be satisfied. Perhaps a product arrives, and the customer doesn’t think it meets the criteria described at the point of sale. Even worse, there are some people who will order items and – depending on what payment methods you use – attempt to get the item for free by disputing the charges.
All of these issues can be frustrating and nip disproportionately into a store-front’s bottom line. As such, it is vital that you have a clear, concise and easily visible shipping and return policy to streamline any issues.
Competitive Pricing
The unfortunate reality of a globalized economy for online storefronts is that prices are becoming more competitive than ever. Ironically, the same dynamic that allows many of these store fronts to exist in the first place also creates an immense amount of pressure on overall profits.
From small-scale drop-shippers on sites like Amazon and eBay to major retailers, virtually everybody has access to markets – both domestically and internationally – that leave very little wiggle room for beating out the competition’s prices. As such, it becomes increasingly more important to persuade customers based on factors other than price.
Nevertheless, what competition does exist has dramatically thinned the profit margins for most products sold by online store-fronts. With the exception of home-made, unique and curated items, online stores are being forced to accept smaller profits for more work with each passing year.
Major Retailers
The biggest names in the retail game have been applying pressure to smaller stores for years now, but the pressure is really being turned up in 2018. As giants such as Amazon continue to force smaller businesses either out-of-business or onto their own outsourced platforms, more and more business owners are finding it difficult to overcome this reality.
It’s not just a matter of pricing. These major giants offer flexible and fast shipping options, unique payment plans and payment methods, and warranties that many store fronts simply cannot provide. This, along with the familiarity factor, gives many customers peace of mind and continues to drain support from smaller store-fronts in the process.
Marketing Requirements
As competition becomes fiercer and distinctions become harder to make, online store-fronts are going to have to invest more into marketing in 2018 to remain relevant. Many online businesses have used marketing as one way to circumvent the need for organic traffic via search engines, instead opting to run ad campaigns via social media and search engines.
Another common tactic used to retain customers and bring them back involves building massive email marketing campaigns centered around email addresses earned during purchases. This is arguably the most affordable and effective form of marketing due to the fact that a) you don’t have to pay for the leads and b) these people have already demonstrated interest in what your store offers.
Whatever strategy is pursued, either time or money (or both) will be required. For more established store-fronts with ample consumer bases and disposable income, pursuing both organic and paid marketing strategies can easily be done. However, businesses that lack a chunk of resources may be forced to utilize more traditional forms of marketing via social media and/or strategies such as search engine optimization to increase their visibility and compete within their niches.
2018 is going to present multiple challenges for online storefronts, but each store will face its own unique situation. Whether it relates to pricing, competition, marketing woes or something entirely different, these struggles are persistent and will likely continue to be issues in the coming years. With new challenges that’ll emerge sooner or later, brands that act proactively have a much better chance of weathering the storm and being successful in the new year.
