Online shopping has been growing for years, and the pandemic made more businesses focus their efforts on ecommerce. That means there's more competition than ever, so if you're looking to get in on the ecommerce action, you'll want to avoid these mistakes.

1. Not Adequately Budgeting for Marketing

When you're starting out in ecommerce, it might seem like it's all about getting the website and the platform right. While these are certainly important components, you need to make sure you're not spending all your budget on this. There are plenty of tools at your disposal that can help you save money in this area.

You do need to make sure you are able to spend significantly on marketing because getting your products in front of prospective customers and getting them to choose your site can be incredibly difficult, particularly now that it is so easy for people to sell their products online. You're competing with the rest of the Internet for attention, so effective marketing is critical, and it's not cheap.

According to an article in Entrepreneur Magazine: "To build a successful e-commerce store, retailers must pull the right combination of three levers — gross margin, conversion rate and traffic. The first two are hard to control out of the gate, but what makes the most impact out of the gate — and what you can control — is driving traffic. Traffic is a commodity, yes, but it’s getting harder to just pay someone to cultivate traffic for you. Merchants must answer three questions — 1) what are we providing that’s unique, 2) how can we best communicate that, 3) where will that message be most effective."1

2. Using Technologies You Can't Wrap Your Head Around

It can be tempting to jump on the latest trends in ecommerce and technology. While it's a good idea to stay on top of these, it's not always necessary to climb aboard. You can risk overcomplicating things or spending time and resources trying to fix processes that aren't broken. Stick with that you're comfortable with, as long as it works.

"When everything went remote during the pandemic, our company considered incorporating new apps and services into our daily lives to facilitate virtual communications, but we ultimately decided to keep our tech as normal as possible," says Rachel Geicke from Snow Monkey.2 "So we’re using the same project management platform and maintaining communication through email and iMessage. Many companies enjoy using communication platforms, and we get that, but most of our team grew up in the AIM/iChat generation, so iMessage just felt more natural."

Geicke says that when you're creating a digital business, such as ecommerce business, it can help to do what feels natural to you and consider outsourcing more technical aspects to experts.

3. Going it Alone

If you plan to be a solopreneur, you may be doing your business a disservice by trying to run it all by yourself. This may work in the beginning, but if you see early success and wish to grow, you will likely need help.

Outsourcing is an option for some tasks, and you can hire employees, but even in the beginning it can be helpful to have a business partner to bear half of the responsibility and contribute ideas and work. If you are willing to share your success, you just may find more of it.

4. Going Into a Field You're Not Passionate About

Perhaps the worst mistake you can make is entering an area of ecommerce that you're not passionate about. You may lose interest before you reach your potential. Secondly, people may be able to sense your lack of enthusiasm. Social media and content marketing are major components for many successful ecommerce businesses, and these are areas where passion shines. If you don't have it, it's going to be difficult to get other people to care.

Getting started in ecommerce is probably easier than opening a brick-and-mortar store and keeping it open. You won’t have to solve many of the problems that arise with business in the physical world. If you avoid making the above mistakes, you can minimize those that arise in the online world, as well.




The information provided is presented for general informational purposes only and does not constitute tax, legal or business advice. Any views expressed in this article may not necessarily be those of Nevada State Bank. Nevada State Bank is a division of Zions Bancorporation, N.A. Member FDIC