E-commerce is a keyword that is no stranger to economic people. Looking from the outside, the profit that this field brings is extremely large. This is also the trend of many entrepreneurs. But to shake hands with success in this competitive environment is not easy. Based on statistics from reputable e-commerce sites in the world, the collapse rate of start-up companies in the first year is very high, about 70-85%. This result is really terrible. So why do companies collapse so quickly? This is a topic that many entrepreneurs are interested in. So follow Cmsmart to find out more in the article today. With the theme “10 reasons why e-commerce startups face failure”.
Why do e-commerce companies fail?
There are many reasons why a start-up company will fail. However, it is inappropriate to give the previous reason to explain the phenomenon. Because every time, every era will affect the economic situation at that time differently. And to get the most accurate answer, a survey between 1253 owners of start-up companies that had failed in the UK took place. And the organization conducting this survey is the digital marketing agency Marketingsignals. After a period of research, the results can be generalized:
Here are 10 top reasons to make e-commerce startups fail:
- Poor online marketing 37%: The present era is the digital age, if you don’t respond, catch up the trend then it will inevitably fail. Not only do you have to catch up, do well, but also keep on creating the world’s best, then you will succeed in e-commerce. Poor marketing means that your products will not reach customers. Going on with that situation, the dying day is not far away.
- Lack of online search visibility 35%: This is one of the reasons that greatly affect your business results. The search users on google but the results returned without the appearance of your product. It was worse. Please optimize SEO very well.
- Little to no market for their products or services 35%: E-commerce has never been as exciting as it is today. How terrible competition is, everyone knows. Finding a market to sell is not really easy for a start-up company. Even a company that has not been able to glimmer has been extinguished by the big companies in the market.
- Running out of cash 32%: Financial problems have always been one of the reasons causing many concerns for traders. During operation, the company needs a lot of cash to operate. Without sufficient financial resources, all processes will be stalled.
- Price and costing issues 29%
- Got outcompeted 23%
- Retail giants dominating a large share of the market 19%
- Lack customer service 16%
- Poor team around them 14%
- Product mistiming 11%
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