Ecommerce has taken the world by storm. Everyone seems to be jumping on the ecommerce bandwagon which seems like a goldmine to everyone. However, being in the cut throat competitive market of ecommerce is not a cakewalk and it is made out to be. Like any other business area, it has got its own pros and cons that these should be considered carefully before venturing out in the realm of ecommerce. However, with the rapid strides that the technology is taking and with the almost exponential evolution of the World Wide Web, it is imperative that the ecommerce is the technology that is going to evolve further in the future and the advantages and disadvantages listed above may change as per the dramatic changes in technologies. Here, a number of advantages and disadvantages of ecommerce are listed and you should consider them carefully before venturing in the bold and new world of ecommerce. Here are the advantages of ecommerce:
- The Sales that never sleep:
Once you have set up your ecommerce store, it is accessible to people 24×7 without any break, working even on long holidays and the festive seasons. This is a huge advantage as far as ecommerce is concerned, since your business is never at a break and your webstore never sleeps.
- Lower Costs, Higher Profits:
The other big advantage of running an ecommerce store is its low running and maintenance cost. This is comparatively very less as compared to owing a physical space in the form of a brick and mortar store where the maintenance cost is very high.
- Expand your reach to everywhere:
Breaking down of the geographical barriers is one of the main advantages of the ecommerce stores. With an ecommerce store, you don’t have to limit your business to a particular geographical location, however, you may carter to a specific geographical location. But that doesn’t stop customers from all over the world to access your webstore and be your customers and order goods and services from your stores. How cool is that?
- Open up to infinite possibilities:
Your sales open up to infinite possibilities due to the various traction channels available online. You don’t have to restrict your sales effort offline to banner ads or newspaper ads or the costly television ads. In the online space, you can opt for a wide ranging PPC ads or even opt for content marketing and various other traction channels to make your webstore popular.
- Easy to maintain inventory:
You don’t need to stuff all your products in your brick and mortar store to make it visible to the public. You are able to sell a wide range of stock items due to the advent of ecommerce store where you can maintain a huge inventory for different number and types of stores quite easily.
- Make more profit per item:
You can make more profit per item sold in an online ecommerce webstore. It is well established that sell online is more cost effective than selling in a brick and mortar store, even though the math for this may be different. However, eliminating the need of a physical space in costly retail and also maintaining decent volumes of traffic in your online store ensures that you make a higher margin even with a low sale price.
- Upselling is like a piece of cake:
You can easily upsell products to your customers in an ecommerce webstore. Suppose that your customer is viewing some book and about to purchase a certain book at a certain price. However, now consider the scenario where on the product description page there comes the info of customers who brought this book also brought a certain other book and your prospective customer is definitely tempted to buy even that book. This is an upsell and ecommerce stores do a wonderful job in this.
- Cross selling was never so easy:
You can also easily cross sell products to your customers in your ecommerce webstore. Suppose that your customer bought a coffee grinder from your ecommerce webstore. Now as your customer is proceeding for checkout, or on the product page description itself, there is information about a new microwave with a special offer or discount. This definitely tempts your customer and they can buy your other product (a microwave in this case) easily. Thus, cross selling becomes easy in an ecommerce store.
- Data goldmine:
With an ecommerce webstore, you can collect a wealth of data about your customers in a jiffy, without much effort since most of the process is automated. This wealth of data would be of great value to you and based on it you can tweak your ecommerce webstore to suit itself as per the needs and preferences of your customers.
- Email marketing will love it:
If configured in a proper manner, your ecommerce webstore will be able to collect the emails of all your customers. This gives you an added benefit of properly executing an email marketing campaign, and if done properly, is an extremely low cost method of continuously driving traffic back to your store in the form of various goodies like special offers and quizzes, etc.
- Engage your customers through social media:
In this era of social media platforms, it is essential that you are able to engage your customers through social media. With your customers already using a mobile, desktop or a tablet, it becomes easier to drive them to your social media profile and make a favorable mention of your store or some of your product or services which gives you a definitive extra edge over your competitors.
- Get insights through analytics:
With your ecommerce webstore linked to Google analytics, you get a whole lot of Business Intelligence (BI) and as mentioned before, it can open whole new vistas for your webstore and give you an extra edge over your customers.
There are a number of disadvantages as well associated with your ecommerce store. Here are a few disadvantages listed:
- Lack of personal touch:
There is a lack of personal touch with your customers as compared to a brick and mortar store. Compared to a real physical store, the online shopping world seems to be lacking the warmth and a personal touch with the customers.
- Too restrictive an environment:
With online shopping, it is quite easy to compare prices due to various search engines available. While buyers are at an advantage due to this, sellers find this kind of environment too restrictive as many of them get filtered out from the consideration of their potential customers irrespective of the quality and the service they are offering.
- Lack of physical proximity:
One of the main disadvantages of online shopping is that buyers are not able to physically experience the product before buying it and it takes the whole fun out of the shopping experience.
- Internet is compulsory:
There is a pertinent need of an internet access device and an internet connection without which ecommerce would not be possible.
- Beware of fraud:
Credit card fraud is a major concern for both buyers and sellers on the internet.
- Security is an issue:
There are a host of security issues pertaining to online shopping. Consumers are at the risk of suffering from identity fraud and other details as their personal details are captured by ecommerce companies. This may also lead to privacy concerns.
- No instant gratification:
There is no instant gratification as far as online shopping is concerned since customers don’t receive goods at once and they have to wait for a certain amount of time before their product gets delivered. Sometimes delays on this front can be a frustrating experience for both the buyer and the ecommerce store owner.
- Online scams can be a spoiler:
Customers are prone to online scams with fraud websites constantly on the prowl to dupe money from the customers.
- Over dependence on your webstore:
An ecommerce webstore owner is all the time relying on his or her webstore for running the business. Even a few minutes of downtime can sometimes cause a substantial loss to the ecommerce store owner. Hence, there is a fair bit of over reliance on the ecommerce website which is a con of online shopping world.
- Complex logistics involved:There is a complex set of logistics involved in delivering goods to the customers in the fastest possible manner. Sometimes, setting up of such logistics may be quite high in the case of ecommerce and this is definitely a con as far as the world of ecommerce is concerned.