A few weeks ago when I was in Madrid, a fellow asked me amazed if it was true that over 89% of online stores that are created closed the first year. For the answer, even if it hurts, it is that is yes. It is true that we are experiencing a building boom in online business, and this is especially true because many people cannot find work and have to pull ahead by creating a self-employment, and certainly an online store sees it as a very feasible option.
But for my great experience especially in consulting, you discover that many of these projects, if not the vast majority, become traps.
Before creating an online store, as if you open a physical business, you should know that there are many problems that must be taken into account, and unfortunately, the high dose of ignorance and optimism go completely over and end all that just by closing your business online.
But all is not lost, so in this article, you will find the most common mistakes that homeowners to create an online store, so you can learn from them.
1. Not knowing what niche you mess
It is very common for people to create an online business that knows nothing of the niche where he will be involved. Hurtle to create a business without knowing how that market works, what interests the user, what works and what does not, what we sell and what not, .. etc. It seems obvious to know the market but, unfortunately, this is one of the most common mistakes. Before entering a market, you have to know well.
To open a business with some successes have to make some research and market studies before. The eye does not say useless pay a market study is useless. I mean you must identify which products are most saleable, which carrier is best, how much will the postage, what margin can make the products, which choose suppliers, how you going to raise awareness and get visibility, … and one so huge. You cannot open your e-commerce if to answer all those questions, and you should know that creating an online store is not just a web page with a cart and a few products and that the business is already mounted century. As I tell my students, the store is only a grain of sand without the rest of the gears will never work. Planning is the key.
3. Do not think about the competition
A huge mistake is to leave the market without knowing exactly who your competition and what it does. Many e-commerce owners to whom the business will not work ask them to tell me three competitors, and could not answer. By ignoring this, shipping costs will not know what they have, what’s selling, what they are strong and which are weak, their policies return..etc.
When analyzing the competitor often we realize that going wrong in the project because the same competitors are already very strong and almost impossible to beat them. But this is not bad because it makes you reflect and change direction. For example boysCuerdasguitarra.com to analyze the competition realized that competition from online stores guitars and musical material was very powerful and could not offer their shipping costs, pricing, offers, etc .. but the best It is that found that those companies were not interested in selling the guitar strings for its low price, and that’s where they saw market. The strings are lightweight, are changed every three months, and their profit margin is good. So thanks to these guys investigate your competition gave them the key to succeeding with an online business.
4. Competing for price
Opening an online business around cheap is very risky because many of the competitors will have e-commerce giants have behind to enable investors to buy stocks with very large allowing them to hyper amazing prices. Furthermore, these companies spend huge amounts on advertising AdWords and retargeting.
5. Do not choose the right platform and design
This error is typically all committed and most damaging. Create a shop on the wrong platform or have a bad aesthetic, will make your business does not work or miracles. That is why you must choose your platform well before doing anything, knowing that the professional who will create the business is skilled and can modify and add whatever, and above all the aesthetic business is impeccable.
6. Do not know exactly how to make yourself known and get traffic
But you hit in this sorry to tell you that you better not get in online business, and if you have money to invest in promoting yourself online do not create an e-commerce.
Even if your shop is online you will not find so well, and is very, very difficult to get traffic. To give you an idea you need to over 1,500 views of your store to have a sale, so imagine the number of users you need to make your business profitable.
To get traffic you have these options:
- SEO: You need to position yourself on search engines so that when the user searches for something you sell you are in the top five. This option is very good, but very slow, long term and will have to make a professional, because if you do not know much SEO tutorials you see you will not get anything.
- SEM. AdWords ads are a quick option. Adwords brings you a lot of traffic if you do it right, but be careful, because it’s like a slot machine where many businesses have failed by not knowing how to run it properly.
- Social Networks. It is a good choice to be present in the relevant market to your social networks. Social networks are free, although some like facebook that are free but to be successful you have to invest a little in advertisements. It is one of the best options for a startup.
Well if you do not invest will be difficult to get users. I remember a client who told me “I want to get a win as boys Hawkers with a turnover in less than a year more than 15 million euros with its e-commerce and that most of its sales came from Facebook “. I started researching and what was the surprise that these guys spend more than 6,000 euros a day in advertising very filtered on Facebook. So yes. I’m not saying you have to spend it, one of my clients spent 100 euros per month on Facebook and finds it.
7. Getting into business bootstrapping without knowing
Before getting into this type of online business, you should know how it works, who you have to compete, and what margin you have left. Business is where you have only 5% (a product of 20 €) and have to pay for advertising to get traffic, create the store, pay for SEO, .. etc. As you will see they have to sell a lot to him out profitable. But that’s not the big problem, but these providers work with many online stores more and, therefore, have the same products, the same price, the same texts, etc .. I advise you before entering bootstrapping analyze everything well.
8. Do not know what products you sell
It will seem incredible, but I know many owners that when you ask what it is for a product, how do you know or what happens if you drop water, do not know an answer. It is imperative that you know the products they are selling for quality descriptions and know advice and counsel clients. It also will help in marketing and promoting your business because it will give clues to what content generate.
These are some of the mistakes that will make your online business will not survive, so you should avoid them and thus your business will have more guarantees to function.