Online selling: pitfalls and tips for e-retailers
- Willeke Leensma
- Q and A
- 16 Jul 2019
- Edited 3 Feb 2023
- 4 min
- Managing and growing
Should you build and maintain your own online shop or choose a ready-made e-commerce platform instead? There is a lot to consider before you start selling products online, including many factors that might have never even crossed your mind. 3 successful e-retailers talk about their biggest pitfalls and share tips on how to avoid them. Nancy Joseph of e-commerce advocacy group Thuiswinkel.org weighs in with valuable advice of her own.
Pitfalls for online shops
1. A prehistoric online shop
Peggy van Neer of Snurkamsterdam.com makes bedding and loungewear. When she started her online shop 10 years ago, the online world was very different than it is today. "We had a custom site built back in the day. It is so old now that you could almost call it prehistoric", van Neer admits with a smile. The world of online shopping is constantly changing. If you want to keep up, perform major maintenance and updates at least every 2 years. The big drawback of a custom-built shopping site is that you always have to invent and pay for every change or update yourself.
2. Choosing the wrong web developer
It pays to request multiple quotes from web developers. Van Neer explains why this is so important: "Unfortunately, some developers will be very aware of your limited technical knowhow and see you as a cash cow. It might be tempting to take a hands-off approach and trust the experts, but believe me: if you are outsourcing web development and know what is best for you, you should at least get up to speed with the basics. Alternatively, try to find someone in your network who understands IT and involve them in the selection process."
3. Not knowing your customer
Joseph: "Research what your target audience needs. To measure is to know! Avoid making assumptions and get to the bottom of what your customers and leads really want. What kind of people are they? And what are their ordering preferences?"
4. Marketing agencies promising immeasurable riches
Mieke Hendriks of Puurmieke.nl sells organic products online and was initially too open for suggestions by a marketing agency. "They promised me immeasurable riches. I ended up spending thousands of euros and got very little in return. They did not think about what was best for me and were only concerned with billable hours. They had no feel for my market and what I was doing." When working with an expert, trust your instincts and keep a close eye on what they do. Hendriks has since hired a self-employed contractor: "Independent contractors tend to put in a lot of effort. She works from the office once a week, which helps me stay on top of things."
5. Conversion Killers
According to Joseph, poorly written or overly concise product information and difficult ordering processes are real conversion killers. This also applies to uncertainty about the identity of the entrepreneur. Joseph has a few great recommendations for anyone looking to build customer trust: "Apply for a quality mark, publish customer reviews, and offer multiple payment and delivery options. Another big one: make sure that your site is compatible with all devices, especially mobile ones."
6. Outsourcing services with low-margin products
You should only outsource services if you sell high-margin products. "At first, I had my products packaged by another company. Because the margin on my products was too low, it put a significant dent into my profits and hurt the overall profitability of my business. It is better to sell fewer products with a higher margin than working your fingers to the bone selling as many low-margin products as you can", Hendriks explains.
Tips for e-retailers
1. Save money with an e-commerce platform
"Nowadays, the market is packed with e-commerce platforms that will invent the e-commerce wheel for you and update themselves. This will save you a lot of time, money, and headaches," van Neer points out. It all begins with researching which e-commerce platform is the best fit for your business, budget, and products.
Hendriks agrees, explaining why the custom online shop she had built when she started her business might not have been the best idea: "It just did not work and I had to pay for every single modification or security measure. What’s more, custom-build websites age rapidly. My current online shop is hosted by an e-commerce platform. I automatically get updates and the platform solves any problems for me: it is all included in the price."
2. Customer service, where is the line?
In addition to cables, Kabelshop.nl’s Piotr Kreuning also sells homeware and gardenware. "You want to keep your customers satisfied. But there will always be people who try to take advantage of you with unreasonable demands. For example, if a customer has a tear in a garden cover after a year that is not on the seam, do you send such a customer a new cover?” It can be difficult to decide when to draw a line and when to honour a warranty request, even if you were not responsible.
3. The holy trinity: convenience, service, and speed.
Van Neer stresses the importance of staying up to date with the latest developments in e-commerce for consumers. Shoppers quickly get used to the level of service, convenience, and speed provided by large online shops. "Customers want to find the product they are looking for as quickly as possible. Cannot match the same speed or service? Or are there illogical steps in your purchasing process? Your customer will likely run off to a “better” alternative", Van Neer explains.
A typical mistake is putting overly large photos on your site, making it very slow. But also shipping costs that your customer only discovers when they reach the checkout. "And are you difficult about returns or do you have poor customer service? They will destroy you on social media”, van Neer concludes. So, an optimal customer journey * (In Dutch) on your website is essential.
4. Hiring staff? Get the timing right.
According to Fouad El Yandouzi of Kabelshop.nl, there is also much to be gained from a good HR policy. "Avoid hiring too many new workers at once. To run a successful online shop, you need multiple highly interdependent teams: The warehouse, customer service and marketing departments are all strongly intertwined. Make sure to hire approximately the same number of people for each department at a time. Timing is key."
5. Safety and rules
Joseph points out the importance of safety and rules. "Make sure that your online shop is fully compliant with all rules and regulations. Do not forget to check if it is safe and secure and prevent potential data breaches."
6. Make smart inventory decisions
“Many suppliers see it as an advantage that we keep everything in stock instead of dropshipping,” says Kreuning. But how do you decide how much stock to keep? A large inventory costs a lot of money, too little inventory can lead to delivery problems. Buying surplus stock can mean a big success for your company, but you can just as easily be left with lots of products that you cannot sell. "Consider every possible outcome before closing a deal", Kreuning concludes.