There are many reasons for lack of sales and business failure. New startup businesses fail often for a variety of reasons. This is especially true for ecommerce websites and ventures. The truth is that an online business with ecommerce fails at a much higher rate in comparison to brick and mortar businesses. Ecommerce website failure can be attributed often to some key reasons. These reasons are best to avoid for better chances at success.
A brick-and-mortar business according to the SBA (Small Business Administration) fails at an average rate of just over 20% in their first year. Compared to an online business, it is great. Ecommerce business fails at a much higher rate closer to 90% within the first six months. Now, brick and mortar has been severely impacted last year by the pandemic. This pushed most consumers to shop online. Many online retailers experienced a boost in sales due to these events. Others struggled due to product type and market.
In 2020, online sales grew in four months more than in the last past ten years. This significantly increased online shopping habits and overall transactions. Nevertheless, new and existing retail brands struggle to increase sales and profitability. There are 5 most common reasons, ecommerce website businesses fail. These are listed below with additional details. For best results, retailers should work with experienced professional agencies.
Top 5 Reasons Ecommerce Websites Lack Sales
1) Insufficient and poor online marketing efforts.
This is the main reason; ecommerce websites and online businesses fail. They simply have insufficient and poor online marketing efforts. Not comprehensive enough, amateur execution or management. Mistakes made and inexperienced strategy can quickly impact a business negatively. It can also put a stop on growth and market share gain.
2) Lack of search engine visibility.
Being found in search results is critical to most types of businesses. When active potential customers search online using search engines such as Google, it is best to be found in the top three results, on the first page. Without SEO services this is difficult to achieve. Successful SEO campaigns are required here.
3) Little or no market readiness.
Lack of sales can translate at times to have more significant meanings about the market. Certain markets are simply not ready yet or too small to generate sales. Even with successful marketing, not enough sales can be generated. Market research or work though consulting services can assist here.
4) Lack of sufficient budgets.
This of course is a key reason for failure. When the money runs out or is not available, a business struggles. Lack of sufficient budgets for marketing and sales efforts contribute quickly to the failure of ecommerce websites and businesses. Even with sufficient marketing, it takes time. Without budgets, it is very difficult to gain momentum.
5) Pricing, cost and competition.
The 5th most common reason for failure is pricing. The cost of products, manufacturing, or/and set sales price prevents success. It often is also that competitor’s products sell for less. Overall, pricing is the reason for the failed business. Proper market research helps avoid these types of mistakes. Setting acceptable prices for products improves chances at sales.
For brands that wish to improve their efforts, speak with a consultant that can go over details, options, and requirements. Consulting services are available to gain clarity, as well as other services to implement changes. Speak to an expert today about ecommerce website failure reasons. How to improve and increase online sales.