Why 90% of eCommerce Startups Fail and How to be in the 10%

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Why 90% of eCommerce Startups Fail and How to be in the 10%?


There are thousands of blogs on the internet to speak loud about how to be a successful e-commerce business. But, if all of them point in the right direction for the entrepreneurs, then why do nearly 90% of e-commerce startups fail? The truth is that only a very few blogs are projecting truths for entrepreneurs.

This blog will be one of them and point out the real problems behind e-commerce failure. It starts with the fundamentals of online business and ends with eCommerce app development to help you to learn from the failures and stand alone in the market.

Factors Behind the Success of eCommerce Businesses

Before discussing business success or failure, you should know what defines these two things. That means you should know about the success factors; often, it can be called CSF (Critical Success Factors). It describes the things to do to get success in an eCommerce business. So let’s check some of the business CSFs’ for e-commerce businesses.

  • Proper Planning – A proper business plan is necessary before starting every business. Such a proper business plan should have a list of feasible business objectives and the proper way to achieve the goals. The business model canvas and the revenue streams can help you to map your business plan properly.
  • Execution Process – Execution is a little more difficult than planning. First, you must arrange the needed things for your resources like goods, human resources, technical support, physical place, online store, and others. Unfortunately, most startups fail at this part as they don’t focus on the legal part. So, it is advisable to consider legal advisors and business advisors before starting a business.
  • Business Operations begin with setting up the business objectives and achieving them. Next, you must deal with multiple KPIs like customer conversions, impressions, and abandoned cart numbers. Then, it helps you to scale your business success or failure.

The business operation of e-commerce is taking care of the operations from getting orders from customers and delivering the goods to them at the right time. To do the operations properly, you must recruit the right human resources, procure the operative technologies, and others.

  • Strategic Focus – Kick-starting an e-commerce business with proper resources does not mean that you can get success in the market. You need to penetrate the market first, attract customers, convert them into loyal customers, and execute marketing and other selling strategies. You can increase your loyal customer base and revenue range by doing this properly.
  • Finance and Legal – Once you grow your business, you may face many financial and legal-related issues. Solving all of them by yourself is impossible. So, you need to hire a business consultancy service as an outsource or an advisor for your business. But if you are outsourcing such business consultancy, they can provide overall support and prevent operational risk, legal risk, capital risk, reputational risk, and any others.

These are the primary factors of the success of an e-commerce platform. Unfortunately, most budding entrepreneurs mistakenly think they can face and solve all the difficulties alone. But it is a big blender they usually do. So, if you are an entrepreneur who wants to succeed in your business, join hands with the right experts to nurture your startup.

Why do Most eCommerce Startups fail?

The setup that didn’t focus on the above-said factors will fail. Most startups in the online retail industry fail in the business operation part. When an e-commerce platform can’t provide services that fulfill the needs and expectations of the customers, they don’t prefer the platform.

  • Problem with Online Platform – Online platform is the primary launchpad of an e-commerce business. So, it should be perfect, attractive, accessible, responsive, and seamless. All the front runners of this online retail business have such robust platforms.
  • Inefficient Delivery Process – Imagine the scenario a consumer places an order on your excellent e-commerce platform. But the customer receives the product after 20 days due to efficient delivery. In such cases, although your product and the online platform are good, the consumer will not place an order anymore with you due to the late delivery. So, you need to include and manage the delivery persons properly.
  • Error in Workflow – Let’s consider the delivery person delivering the product at the right time (on or before the estimated time), but the customer got an irrelevant product. It also impacts your brand reputation badly. An error in the operational flow of your business will cause this kind of error. Double-checking with a tech solution or completely automated AI warehouse setup will help avoid such human errors.
  • Missed to Satisfy Customers – Even though you’re providing the right products at the right time with a perfect online platform, your eCommerce business has the chance of failure. It is because of a lack of customer satisfaction. It has numerous factors like improper reply through customer care, doesn’t care about the customer review, and carelessness about the flow with the current trend are some of the factors that cause this kind of failure. To avoid this error, you must satisfy your customers in multiple ways.
  • Failed to Engage Customers – The customers are the people who are always looking for the best deal in the online retail market. If your competitor announces offers that are more beneficial than yours, then you may lose your customer base. To prevent that, you have to provide offers frequently. Along with this, you should conduct loyalty programs through your online platform.

These are the problems that cause eCommerce startup failure. The solution for the problem is also provided above. But how to execute the solution? First, let’s check your key to success.

E-commerce Mobile App Development: Let’s be in the 10%

You must have a web and mobile application for your eCommerce business. Both platforms should be feasible, seamless, and crafted with recent tech stacks. Only through such online platforms can you do the following things.

  • Attract customers with user-friendly interfaces and features.
  • Include endless products and detailed descriptions.
  • Provide complete transparency like order tracking and others.
  • Enable customer-centric approaches like canceling facility, reordering, and others.
  • Allow your customers to rate the products.
  • Track customers’ buying behavior and provide personalized service.
  • Provide multiple payment options.
  • Conduct customer loyalty programs and referral programs, etc.

These features of a robust e-commerce online platform solution can attract and engage consumers easily. It also contains a retailer application (if your business is based on an aggregator model), a delivery person app, and an admin panel to manage your business flow and working process.

Through these, you can automate and manage business processes easily. In addition, it helps you to reduce human errors. First, however, choosing the best Web app development company is your great and crucial responsibility.

Summing Up

By planning, executing, and choosing the right technological solution, anyone can run a successful e-commerce platform with some business acumen. But it is advisable to choose the best business consulting service and the web and mobile app development company to get support from respective experts. It will make your eCommerce startup risk-proof.

Why 90% of eCommerce Startups Fail and How to be in the 10%

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