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E-commerce is taking over retail, with companies like Amazon and Alibaba dominating the corporate rich list. Statistics show that by the year 2020, e-commerce will be worth over $5 trillion. However, even with these rosy statistics, this is a market with its own fair of challenges. It’s not a get rich quick industry. So, what challenges do e-commerce owners face in 2019?
1. Competition
Thanks to advances in mobile computing, consumers now have easy access to e-commerce companies from all across the world. A consumer can be driving in the U.S, while making product orders in China. This means that an e-commerce owner has to ensure that their product offering, and pricing are as competitive as possible. The challenge is that, costs are different in different parts of the world. Some seller halfway around the world can provide the same product you are offering at half your price. Due to globalization, and the blurring of boundaries in international trade, such a seller can deliver that product in your locality, without adding much to their cost. This has been a challenge for e-commerce owners, and will continue to be, all through 2019.
2. Complexities in the payment process
When selling products online, buyers expect a seamless and simple process. While most e-commerce sites offer this, they also face a huge challenge in terms of security. For instance, when it comes to credit cards, most e-commerce sites have to contend with the risk of chargebacks by rogue customers. This is a challenge that will only get worse in 2019 as scammers become more sophisticated in their methods. Luckily, there are companies out there that can help you handle such challenges. For instance, a company like Pinpoint Payments is experienced in credit card processing for e-commerce. They give you a seamless customer checkout service in a secure environment.
3. Maintaining customer loyalty
In the past, when business was mainly brick-and-mortar, it was easy to use traditional marketing methods to build brand equity. These strategies no longer work in the era of e-commerce. Due to the increased ease of information access, people no longer have the need to stay loyal to a specific brand. This a challenge for e-commerce owners, especially the smaller brands. They have to be on their toes in trying to please their customers. This is a challenge that will only get worse going forward. An e-commerce site may have lots of customers today, only to lose them all to the next big thing tomorrow.
4. Tightening data privacy laws
E-commerce companies collect data and use it in making strategic business decisions. However, this is getting tougher. That’s because, all over the world, countries are passing more stringent data privacy laws. The GDPR in the EU is a perfect example of such laws. This means that in 2019, and for many years to come, E-commerce companies will find it challenging to take advantage of customer data to advance their businesses. This is a challenge that will hit the smaller e-commerce harder, since they don’t have the resources to maneuver around such laws.