Advantages and disadvantages of e-commerce
Table of Contents
In the present blog article, we are going to give clarity about the important 15 advantages and disadvantages of E-Commerce (you must know) before starting an e-commerce store.
Its always said that E-commerce is not only a necessity and trend, it is the future of the way of doing business as well. As per the report provided by Statista, it is estimated that by 2040, the use of purchases through e-commerce platforms will reach up to 95% of total purchases. It is always argued that e-commerce is for some specific type of business models/businesses and not fit for all businesses as well as it depends on technology as well. Here we are discussing various advantages and disadvantages of e-commerce that every business owner must have an idea of so that they may decide about shifting/starting for e-commerce and make strategic decisions.
Advantages of E-commerce in India
1. A Large Market
eCommerce allows you to reach customers without any location constraints and it may reach all over the country as well as the world. There is no limitation of timings for running these stores and it works 24X7. Purchase can be made from home. Using many shipping options at affordable pricing has helped to make a reach to even the remotest places in India and abroad.
2. Customer Insights and analytics
Customer Insights via Tracking and Analytics. Here user traffic can be tracked and an e-commerce user journey can be established. As a businessman, you will have an idea that how users came to the site (SEO/PPC/Social Media, etc.) You may have an idea about user experience, price strategy, etc.
3. Lower cost
As compared to the traditional cost of setting up stores and managing overhead charges like rent/owning a shop in a prime location, managing employees, etc., the cost of e-commerce store set up is quite reasonable and overhead recurring cost involvement is less. Here for running an e-commerce store you only need a basic setup/subscription fee or hosting from companies like Bluehost and you can upload an unlimited number of collections/products.
In an article about how to develop e-commerce website, click to read in detail.
4. More opportunities for selling
In a physical store, the user is only feeling touch, although in e-commerce stores users get detailed information about a product, its rating, demo videos, reviews, etc. It helps to increase sales conversion as well.
5. Marketing is easier
On an e-commerce platform, you may use SEO, Paid Ads, Social Media Channels, etc. to increase traffic to the store.
6. Improve e-commerce customer experience
Sometimes in physical stores, the chosen product is yours and is not visible to you easily and sometimes you have to ask a salesperson, etc. You feel puzzled while searching.
In e-commerce stores, they have varied filters on various selectors, price range selectors, categories, search bars, sorting based on (price, availability, product feature, rating, etc.)
Also, there is the option of comparing products and take proper decisions. In traditional brick-and-mortar shops, you have to be dependent on information provided by Salespersons.
Seamless check-in, guest login, varied online payment options including Cash on Delivery, Faster shipping options, etc. are the main reasons customers prefer shopping on e-commerce.
7. Retargeting customers
E-commerce provides various options for retargeting your customers as well as it also includes sending reminders/ emails etc. If you are checking out /abandoned cart is showing, it sends emails/reminders about incomplete shopping.
Customers can be contacted through personalized messages/emailers/coupons/offers etc.
Sending Cold mails
Cold emails are sending emails to check out your brand who are not aware of your brand/store and in turn, become your customer. It works out to be a new opportunity for marketers.
8. E-commerce dropshipping
Quick response to Consumer trends and evolving market demand. Dropshipping allows businesses to respond to market and consumer trends in a better way. Also, E-commerce makes businesses respond quickly considering the demand factor.
Benefits of E-commerce to consumers
It includes a wide range of products/services, it also saves time and money. Due to high competition on an ecommerce platform, consumer/user is getting the best competitive price (At times sellers squeeze margin to remain competitive)
What are the biggest benefits of e-commerce over traditional commerce?
For a buyer, the two important most advantage includes shopping with ease from home 24 X 7, saving time and effort. We are discussing in detail other aspects of it from the perspective of a Businessperson.
A detailed article on importance of ecommerce is detailed here.
What are the important disadvantages of e-commerce in India that every business should take care
Here we are discussing are disadvantages of E-commerce and how to overcome
1. Lack of personal touch
As compared to traditional shops, in e-commerce shops, the personal touch of products is not available as well as there is no discussion/recommendation/comparison provided by salesperson. There is no genuine connection with your customers. (Connection help buyers to come back for more)
In the future social e-commerce, augmented virtual shopping, etc. will be in trend.
2. Lack of trust/quality
There is no guarantee on the quality of products. People in India are still hesitant to pay beforehand. So a lot of them are still preferring COD (cash on Delivery)
If the product is fragile and expensive, then various questions come to mind of buyers like how safe is to get the product shipped (if it is fragile), and how safe is to pay.
3. Longer Shipping Period
If shipping is from a faraway place, then the time taken to delivery may be longer as compared to nearby shops (maybe a few hours only)
4. Security issues in e-commerce
Online payments/Security Issues. There is always the risk of a leak of stored card details, and user name/password as created on the store. Hackers may misuse them as credit card fraud is rising day by day nowadays.
5. Cannot try before Buying
Trial of products (especially fashion products, jewelry, etc.)is not possible in online shopping.
6. Some goods cannot be purchased online
Few products e.g. Perishable products like Ice-cream etc, are not fit for e-commerce. Technically it’s possible to sell this product as well. But require a very higher cost of shipping
7. Complexity of Accounting, Taxation, etc.
Since e-commerce business sells to different locations. They have different tax rules, regulations, etc. So businesses need to adhere not only in their own countries/states but also to the place of customer’s residence.
Here we have discussed in detail about advantages and disadvantages of e-commerce. Hope you find it of much use to know about the pros and cons of e-commerce.
What are the important activities of E-commerce?
E-commerce activities include buying and selling of goods/services on the internet and the transfer of money and data to complete these transactions. Other activities include customer education, email marketing, supply chain management, etc.
What are the qualities of an e-commerce website?
(A) Faster loading time
(B) Ease of use
(C) Clear Instructions of policies, returns, etc.
(D) Detailed product description
(E) Good quality images
(F) Security compliance
How to attract customers online?
SEO, Paid Ads, Social media marketing, Email marketing, retargeting, etc, can be used to attract online customers.
Conclusion
Despite a few issues discussed above as disadvantages, e-commerce can offer your business some serious advantages. It’s low in price to set up, it’s incredibly flexible, and it’s super-fast.
Take some time to decide about the pros and cons, how and when, and then get started. We strongly feel that you can do it and grow your business.
We work with varieties of industries for setting up e-commerce stores. We are excited to help you create, manage and grow your e-commerce store. For a more detailed discussion and guidance on deciding about an e-commerce store and its setup, please get in touch with us.