6 Common Reasons Why eCommerce Businesses Fail

Phoebe Skinner

Project Manager
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Reading Time: 6 minutes

If you don’t have the right equipment, it may already be a lost battle. Any eCommerce business has a bright future, however, there are a lot of reasons that could hinder that success. This article discusses a few reasons why eCommerce businesses fail along with how you can help avoid these setbacks.

1. Poor Website

No matter the business plan or the product or service you offer it cannot overcome a poor performing website, ensuring your website is ready for visitors and is easy to use is crucial. No matter the size of your business having a reliable place for customers to visit and shop is vital, no customer will shop on a site which looks untrustworthy or is difficult to use.
User experience is one of the main elements to consider when creating a site, Google looks at this when it comes to ranking a website and a user will not stay on a site if they find it difficult or sluggish to use. This is made clear for Google through interpreting the bounce rate of a website, the higher the bounce, the less user-friendly the site is. An easy to use website is likely to have a higher conversion rate. The layout should be simple and the layout should be easy to follow. Consider the links on your website, these must not link to wrong locations, a site that makes sense to the user makes sense to Google.
Once you have created a user-friendly layout, it is important to consider the products that will be on your website. If your eCommerce store has a range of products it’s time to make sure those products have some great photography to show them off in the best way possible. Make sure you get quality pictures taken of each product and if possible from different angles, this is the best way you can show potential customers the product.
Don’t forget, as an eCommerce store your website is your shop front. Make your products look as good as possible, and make buying them even easier.

2. Competitors

When it comes to having an eCommerce store, the most important thing that you need to remember is that you are NOT the only one. Even for small businesses, you will struggle to be the only one.
Competition is a factor in any industry, however, with eCommerce stores, it is more likely that you are competing in the same space. Google, people will be searching for a product, the same product that you and your competitor sell and rank for.
So what can you do? If you have a slightly smaller business then don’t try and make your website like the bigger stores, but saying that we recommend using them as inspiration. When setting your website up check out what your competitors are doing and see how well they rank and what keywords they rank for. You can then use this as inspiration to what you do with your website, in regards to navigation bars, keywords etc.

3. No Real Investment

Opening an eCommerce store doesn’t automatically incur a large cost. Creating a unique, high-quality store can cost a significant investment. However, you must consider this as an investment. Investing in a quality website, that is built to a high standard with everything you need and want takes a lot of commitment and a significant amount of money. Is it worth it? Absolutely, creating an easy to use and a quality site will convert much better than a poorly built site. Getting the investment can be tricky if you don’t already have the funds to invest, however, it is highly worth the hard work, consider building a portfolio to prompt investment

4. Marketing Channels

As an eCommerce store, there are so many different ways that you can raise the awareness of your store. Your store can exist online, but if no-one knows about it then it is not going to make any money. Consider how you can get traffic to your eCommerce store.
To do that we recommend you look at the different strands of digital marketing and how they are relevant to your business and your objectives. SEO is an essential element of any eCommerce store in order to gain traffic to your website. By ranking organically for the products that you sell you are more likely to gain good quality traffic to your website. However, as we discuss in our eBook, Organic vs Paid search, organic rankings are a continual task. If you want to get more traffic instantly and not wait 3-6 months for SEO to have an effect, we recommend you consider implementing a PPC campaign. For eCommerce store, Product Listing Ads can offer unprecedented opportunity as it allows you the chance to already show your product and the price before paying for the click. Therefore, when they do click they are more qualified to buy as they have already seen the product and the price.
Organic vs Paid Search eBook
5. Poor Social Media
There is a multitude of debates when it comes to the advantages and disadvantages of using social media. In our opinion, social media is an intrinsic part of any business. Want to know why?
Creating social media platforms for your products allows for you to raise the awareness of your product to a greater audience.
Before creating a post, you need to think about who you want to see that post, why you want them to see it, and what you want them to do with it. You then need to make your post reflect your answers before creating and posting!
If you have a product that you want to promote on your social media then you need to make sure you have quality images that show the product for what it is, similar to as earlier discussed on your website. If there are a range of aspects of your product then there is no harm in posting more than one image showing the different things that your product has to offer. Take it one step further and post a video of the product in action, or a “How To” if it is relevant.
There are tools that you can take advantage of if you find it quite difficult to find the time to post on your social sites. Putting social media posts on your site is one thing, but seeing how well they do is even more important. You can use each Social Media Analytics to understand each posts performance and their ROI for the business. 

6. Inventory Management

Good inventory management is just as important as any other aspect of an online business and is seen as one of the most significant issues an eCommerce store can face. You have to buy just the right amount of inventory in order to get a good return on investment, too little and you will be missing out on potential revenue, buy too much and you’ll be wasting money on inventory that simply won’t sell.
Without a quality and well-managed inventory management system you could miss out on a lot of potential revenue. Without real-time information, you cannot track which products are doing best. Again there are systems and tools that you can buy that are designed to help with this problem and we recommended any eCommerce store considers them. It can not only save you money but can help prevent you from missing out on potential sales by selling out of products. Customers who frequently visit your site and find items out of stock are likely to lose trust and faith in you and will simply stop visiting your site, the importance of growing trust and reliability within customers is crucial for any business.


This is a non-exclusive list of reasons why eCommerce businesses fail. With a plan in place, you are able to safeguard yourself from any common problems. Whilst having a plan in place you are able to know which areas you need to focus on in order to create a seamlessly eCommerce store that provides an easy to use layout. An eCommerce store is nothing more than a shop online, but it is essential you make that shop online as easy to navigate as your local shops. Especially the checkout stage, as this is ultimately the objective of your website.
Considering implementing a digital marketing campaign should be at the fore of your decision to grow your eCommerce store, and not implementing is a reason why eCommerce businesses fail, to avoid your business failing.
To understand more about whether you implement an organic or a paid search campaign, download our free eBook here.
Organic vs Paid Search eBook

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