Online retail is an industry that shows little mercy to those that fall behind their competitors. It is an increasingly competitive realm, and those looking to grow their online store and thrive in this environment need to learn to not only take advantage of every possible opportunity but also what mistakes to avoid.
One wrong move can have tremendous consequences down the road. To help you avoid some common, yet rarely mentioned, pitfalls facing many retailers we have put together a list of 4 mistakes online retailers are making that cost them customers.
Using a Customer’s Data Without Their Permission
According to MarketingCharts.com, around 80% of all consumers would find the inappropriate or unapproved use of their personal data by a company enough of a reason to take their business elsewhere. Over half of all consumers say they would never trust that brand again.
You can see real-time examples of this principle tanking startups. The social app Candid failed to ever get off the ground when word got out that it was using data gathered from interactions on the app to help third parties develop things like censorship algorithms.
People don't like to have their trust taken advantage of, and most cherish their privacy. If you plan to use customer data in some way, make sure that your customers are well aware of that fact before they give you anything - and always stick to the contract. You can do quite a bit with customer data, as long as you are fair and upfront about it.
Not Providing Sufficient Customer Support
We all have all dealt with aspects of this in our own lives. It is well understood that poor customer service drives away buyers, and inadequate support will eventually hurt your brand name and sales down the road. Yet, online shops are still making these mistakes.
You must be responsive, helpful, and kind at all times. Your customers need to understand that you care about them and their business. If you can't take the time to make their shopping experience pleasant and easy then why should they buy with you? There are probably a large number of competitors out there willing to treat them how they want (no matter how unpleasant of a person they are) in order to get the sale.
Not Optimizing Their Pricing Dynamically
Recent studies show that well over half of all online shoppers will research a product before buying it. This means that your prices need to be competitive or you may be losing over half of all your possible sales.
For a long time technology like competitive pricing analysis software was either too sophisticated or too expensive for smaller companies to operate. For decades bigger box stores were able to strategically change their prices to match the market in near real-time while their smaller competitors could only try to match prices the best they could when they could. Now the technology to keep product prices optimized and up to date no longer requires a large staff or initial investment. More and more online retailers understand that they must use retail price optimization software to boost profits and remain competitive in their industries, even compared to the mega retailers.
This software is indeed a game changer for the industry and ultimately changes how pricing is done. The software allows you to match your prices to market demand (including predicted future trends) in a way that helps you to make more money per sale when demand is high and make more sales overall when demand is low.
Most retailers who adopt these new methods see immediate improvements on their bottom line. This also gives you the added benefit of being perceived as a brand with fair prices - a good investment in your long-term viability.
Communicating With Customers Poorly
Social Media Missteps, Spammy Email Campaigns, Profanity When Dealing With an Unruly Customer, Etc.
These sorts of actions, the kind that annoys, bothers, insults, or belittles customers in some way, can do untold amounts of damage to your business in today's viral world. The majority of these sorts of mistakes will be sending one too many emails to your list a month (understand your audience and try to limit your emails to a reasonable number) and be aware of how damaging a few poorly worded tweets can be as well.
Your overall presence online is crucially important for the success of your retail operation. You must be in control of how your brand is represented online, and how it evolves in line with your business goals. Check these 10 powerful strategies to increase your web presence and try to implement as many as you can into your work processes.
Make sure that all of your customer interactions are either supervised or conducted by highly trusted personnel. Patience and careful wording are key. Don’t spam. Also, ensure your staff is always replying to emails, even if you have bad news.
As you can see, most of these common mistakes have to do with either how you interact with customers, or how much you make that interaction cost them. As with traditional shops, online stores need to cultivate and preserve their customer relationships. Establishing a trusted core group of shoppers who are loyal to you brand can be the key to surviving and eventually thriving as a business.
Community manager at Visual Contenting. Jacqueline loves to talk about social media trends, new technology and how they help businesses accelerate their marketing efforts.
