E-Commerce

Overcoming the disadvantages of the online store: Here's how

Fatih-Kağan Taşkoparan

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The biggest disadvantages of an online store - and how to overcome them

E-commerce is booming and every retailer wants a slice of the big pie. After all, the advantages of an online store for companies are obvious: shopping around the clock, efficiently addressing customers, low maintenance costs and much more. However, the truth is that running an online store doesn't just offer advantages.

In fact, it is particularly important to be aware of the disadvantages of an online store. On the one hand, to know as precisely as possible what you are getting yourself into if you not only want to get started in e-commerce, but also to survive. On the other hand, to skillfully compensate for these disadvantages and even overcome them profitably.

Here you can find out which problems can occur in e-commerce and which advantages and disadvantages of an online store influence each other.

Disadvantage 1: No physical contact with the goods possible

Your customers only see your goods on a display and cannot touch, try on, apply or sniff the products on offer. This may not be so relevant for traditional merchandise. But if your customers can only see unique goods, custom-made one-offs, clothing or even perfumes online, online shopping feels a bit disadvantageous.

Tip 1: Integrate multimedia for a better experience

You should try to photograph your product from all angles and also place it in relation to other objects. This will give your customers an impression of how big it is.

Ideally, you should not only offer static images for viewing, but also show your product in a video. This way, prospective customers can better understand what they are looking at.

In the future, VR technology will also play an increasingly important role in making products more tangible for target groups. Mister Spex for example, has been using the technology for years to conjure up eyewear models live on the heads of website visitors.

But no matter what media and technologies you use as extras to make your virtual shop window more attractive: First and foremost, it always comes down to the essential basics.

Disadvantage 2: Uncertainties, prejudices and mistrust on the customer side

The fact that your customers are supposed to pay for something in advance and only receive it after a few days can raise some (justified) doubts. Especially with smaller stores, customers don't know whether they can trust the operators.

In this respect, some smaller retailers also make life unnecessarily difficult for themselves by offering returns policies that are not very customer-friendly, difficult to find or incomprehensible.

There may also be quality concerns as to whether the products really deliver what they promise. This applies to pretty much all items that do not come from a reasonably well-known brand.

Tip 2: Demonstrate trustworthiness and transparency

Trust is not something you can build up overnight. In order to sell successfully online, you have to convince a whole lot of unknown people of your seriousness in a short space of time.

One way to do this is with trustworthy, well-known seals of approval. If you receive authentic positive reviews, then use them prominently for yourself.

You can also convey transparency and approachability despite a purely virtual presence: For example, offer a telephone number that your customers can use to contact you and create an "About us" page. This shows that there are real people behind the offers and emphasizes that people can trust you and your company.

Disadvantage 3: Too little advice and communication

Especially when it comes to high-priced product categories, many customers do not want to buy without intensive advice. Complex items that require explanation and can be customized, such as cell phones or computers, can quickly overwhelm some prospective customers: on the one hand, because there are so many detailed technological issues to be clarified in order to find the best possible model; on the other hand, because there is such a mass of offers that making a decision alone seems almost impossible.

Stores have the advantage of being able to provide a tangible salesperson and advisor in the truest sense of the word. All too many online stores, on the other hand, only offer very limited opportunities for making contact and making decisions. This reduces the conversion rate in any case.

Tip 3: Create static, dynamic and personal advisory services

In order to provide your customers with all the information that will ultimately convince them to buy from you, you should first create static advice content. In addition to detailed product descriptions, FAQs on product groups, individual items and the general ordering process in your store are very useful. A video can also fulfill this function.

Once you have prepared the static content properly, you can also think about a dynamic and individualized form of advice. The first option here is to provide a telephone number and email address or even implement a live chat. However, you should be aware that these measures are associated with high personnel costs.

Another option is to integrate a filter and query system. If you are selling computers, you could offer prospective customers a simple multi-choice navigation and ask them whether they are looking for an entry-level PC or a high-end computer, how much money they are willing to spend, and so on. Following this pattern, you gradually refine the search until your customers arrive at a suitable product selection.

Disadvantage 4: Costly and annoying right of withdrawal

There are industries in which the rate of returned parcels is around 50 percent. In the clothing industry in particular, it is common practice for people to order at least two to three sizes of the same item to try out at home to see what fits best.

Customers are happy to make regular use of their 14-day right of withdrawal because most retailers not only refund the purchase price but also cover the shipping costs. In addition, many online stores voluntarily extend the right of withdrawal, putting even more pressure on other store operators. This results in significant costs and a high workload that, depending on the product group, is almost impossible to avoid in e-commerce.

Tip 4: Goodwill creates long-term customer loyalty

The reasons for a withdrawal can be many and varied: wrong size, undesirable properties, unexpected color and much more. You should first take all measures to prevent an excessive number of returns simply because your customers are not sufficiently informed about the characteristics of the goods you sell.

Otherwise, dealing with the right of withdrawal is a double-edged sword. There is a clearly defined legal framework that you are not allowed to deviate from. Tricks and flimsy practices to make it difficult for your customers to return goods will backfire and ultimately only scare away your prospective buyers. Instead, be accommodating and accept that the right of withdrawal is part of the deal.

Disadvantage 5: Legal risks in online trading

It is very easy to set up an online store these days. SaaS solutions like Shopify are designed so simply that it hardly takes a day to go live. However, to run a legally compliant store, you need to pay a little more attention: Terms and conditions, right of withdrawal, data protection, legal notice, tax law, accounting and much more.

If you violate the law, this can result in severe penalties. And the legal situation in e-commerce can be quite complicated, especially if you operate internationally.

Tip 5: Obtain external advice

Setting up your store in compliance with the law is not rocket science, but it is hard work - provided you take care of setting up all the relevant guidelines yourself. However, you can also make it easier for yourself and play it safe by seeking external advice.

The consultation naturally incurs costs. In return, however, you will be free from legal aspects and can concentrate on your core business.

Disadvantage 6: Not suitable for all business areas

The disadvantages of an online store sometimes inevitably lie in the business field. If you sell perishable goods over the Internet, for example, this is much more logistically challenging than selling products that can easily be transported across the country for a few days.

This is the case, for example, when you take a traditional family-run butcher's shop into the digital age: You have to somehow ensure that your goods arrive at the customer in the same quality as they did over the good old store counter.

In addition, there are some products that are simply too cheap and where the shipping costs even exceed the value of the goods.

Tip 6: Turn weaknesses into strengths, but recognize limits

If the shipping of your goods is time-critical and complex, then there is no reason why you shouldn't make your website visitors aware of this before they complete their purchase. On the contrary, this even gives you the opportunity to present yourself as a prudent, quality-conscious store.

In the case of the traditional butchery, for example, you could give your prospective customers an insight into the production processes and explain why there may only be two fixed shipping days per week, so that online shoppers might simply have to wait a few more days for their parcel. This makes you more approachable and ideally attracts visitors to your site.

Sometimes, however, you have to admit that there will be little or no demand for certain products over the Internet.

Conclusion

The fact that an online store can have advantages and disadvantages is sometimes forgotten in the general hype surrounding e-commerce. However, many disadvantages of online stores can be compensated for, perhaps even profitably overcome, or at least cushioned if you act prudently and take the right measures.

Since not all of your competitors go to this trouble, you can even turn the disadvantages into advantages, because your customers will feel more comfortable in your store than with your competitors.


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