Succeeding in the lucrative, but competitive e-commerce industry can come with many challenges - Developing a customer-centric approach is critical to success. Read below to find out how and download to keep the PDF version.
E-commerce has become a mainstay in society from giants like Amazon and Alibaba to local shops like Grady’s Cold Brew and M&J Trimming fueling this multibillion-dollar industry. Businesses entering the e-commerce industry face many challenges in terms of competitors, consumer preferences and technology. Developing a customer-centric approach is critical to your business’s success. A Midas Exchange partnership can help drive that growth and lead you to success.
A Bright Future for E-Commerce
With e-commerce representing over 14% of US retail and with sales up 15% in 2018, there is no end in sight for e-commerce’s growth. New technologies and new markets are accelerating this growth by offering more opportunities than ever before. Technologies such as headless ecommerce, diversified payments and consumer wearables simplify and expand e-commerce reach in new ways. Emerging markets in Asia and Africa are bringing an expected 2.1 billion buyers in the market by 2021. This is an exciting time in a strong and growing industry.
E-Commerce Business Headwinds
While the future for e-commerce is bright, businesses confront stiff competition from all sides and using different tactics. Large companies, digital native vertical brands (DNVB) and brick-and-mortar brands adopting online presence all bring their own advantages to the market. Amazon, eBay and Walmart use their strong supply chains and significant resources to maintain almost 58% of the US market share, while DNVBs have enjoyed growth 3x that of the ecommerce industry due to direct-to-consumer business model and advanced niche marketing. Brick-and-mortar brands use their name recognition and history to expand their sales and grow their presence.
Today’s e-commerce businesses must also contend with increasing consumer choice. Diverse choice allows customers to be more discerning, reducing loyalty and demanding more from the business. To combat this, many businesses have employed technology solutions like product visualization technology to increase consumer confidence and real-time chats and artificial intelligence (AI) to create a unique shopping experience. The industry has also generally embraced free shipping and generous return policies, with 58% of all US ecommerce transactions including free shipping and 49% of the e-commerce businesses including free returns. These free services substantially raise costs for storage and transportation, further lowering profits.
Finally, rising operational costs including security, shipping and excess inventory threaten e-commerce businesses. Data breaches already cost a US company roughly $8M, and is expected to rise over 6% a year, bringing significant risk to an online business. Shipping costs are also rising with UPS and DHL increasing rates roughly 5%. These costs have directly impacted e-commerce business health, resulting in Amazon losing $7.2 billion in its 2016 shipping alone. Finally, excess inventory creates financial burdens moving and storing products around the world, requiring constant monitoring and supervision, further increasing operational costs.
‘Customer Experience First’
Fortunately, by focusing on customer interactions, businesses can successfully navigate e-commerce industry headwinds. Implementing a ‘Customer Experience First’ mentality - focusing your business’ e-commerce strategy on consumer value – is that strategy to success. ‘Customer Experience First’ emphasizes channels, personalized the messaging, a hassle-free experience, and secure shopping.
Focusing on the Customer with Midas
E-commerce is a large and growing industry. Tapping its huge upside potential requires wise investment in customer messaging and new technologies. For small to mid-sized businesses, implementing these solutions are time-consuming and costly as overhead risks.
At Midas Exchange, we understand the needs of e-commerce business, having bought and sold many types of inventory across many industries. As a subsidiary of WPP and powered by GroupM, we can deliver superior media quality and accountability in corporate trade transactions.
Working with Midas, your business will gain book value for your assets, above current fair market value, with trade credit redeemable for the purchase of future advertising and media. We will work with you to create a plan to remarket the excess inventory that protects your reputation and aligns with your brand image and distribution channels. Our team offers a broad range of strategies that meet your guidelines and optimize the product’s chance for resale. You have final say and approval of every step of the plan allowing you to place your confidence in Midas Exchange while restoring full value on the inventory. Contact email@example.com or call 212-474-0083 to learn how Midas has helped over 95 companies find the right niche for your products while freeing up budgets for new initiatives.