What are Some Common E-Commerce Challenges for Big Brands?

Consumer technology is evolving rapidly, and customer expectations are changing with it. E-commerce brands must now create seamless and consistent shopping experiences across multiple touchpoints, all while handling in-house operations and navigating an increasingly competitive market. Doing so at scale is difficult when brands don’t have the right tools or organizational structure in place.

In this post I’ll direct some of the biggest challenges facing e-commerce brands today based on my experience at eBay and Staples, and based on the conversations I’ve had with brands that are considering Fabric to scale e-commerce. I will also provide some tips for how brands can overcome and avoid these challenges.

E-Commerce Challenges

1. Lack of digital support from leadership

Many C-level executives don’t have digital backgrounds. Because of this, they continue to allocate capital and resources to what they know rather than what customers are moving toward. This can slow down digital transformation.

2. Perceived complexity

E-commerce decision makers receive mixed messages from analysts, consultants, and industry pundits on what to do and where to start. With so much varying information, it can be challenging to know who to trust and to listen to. For simplicity, start with the basics of e-commerce.

3. Outdated commerce technology providers

Legacy e-commerce solutions like Oracle, Salesforce, and Magento have failed to innovate their commerce technology, making it difficult for users to integrate new sales channels or create the experiences customers expect.

4. Relying on a single technical owner (CIO)

In the past, companies relied on one individual, typically the CIO, to manage the company’s technical infrastructure. But it’s no longer effective to have a single technical owner in the enterprise. You need to break responsibilities out into two roles:

CTO: supports all customer-centric technology, focused on business enablement and growth
CIO: supports back office technology, focused on security, reliability, and cost scaling

The same idea applies to the CMO position where the role can be split between brand vision and data-led marketing.

5. Overemphasis on ERPs

This is often a symptom of organizations with a single technology owner. Instead of focusing on enabling and delivering a great customer and service experience, too much attention is paid to what enterprise resource planning (ERP) system is being used.

Some CIOs allocate large portions of their budget to ERP migrations that never finish. This is most often a waste of the company’s resources as your customers don’t care what ERP you use.

6. The need for design and product led owners

It’s no longer enough to treat e-commerce as an add-on project for just business and IT. Now, you need customer-focused design, product management, and engineering all working in unison. It’s also important to have owners who keep iterating and improving the customer-centric focus.

7. Too much groupthink

Organizations that rely heavily on groupthink often lag behind when it comes to innovation. Unless there is unanimous approval to head in a new direction, the status quo will remain.

8. Shiny object syndrome

In e-commerce, it’s important not to get distracted by every interesting tool that you find (shiny objects). The new live streaming or AR feature may sound great, but it won’t lead to quick results.

Instead, focus on what can drive real results like a simple addition of a new distribution channel to reach millions of more customers, or a simple conversion project to optimize site speed or remove checkout friction.

9. Insufficient marketer and merchant tools

Your merchants and marketers shouldn’t be using green screens, excel files, or calling developers to perform tasks like adding a product, updating a price, or creating a new promotion. This is often the case for companies that still use legacy platforms. The lack of more robust commerce tools like a product information manager makes it difficult for these teams to operate efficiently.

10. Thinking you need to hire consultants

When considering a consultant, ask yourself what you’re really looking to achieve. If you need a consultant, then you don’t know what your customer wants. In this case, you should reexamine your customers’ needs and how you can serve them better internally before seeking outside guidance.

11. Not driving operational excellence

Earning trust means consistently doing hard things really well. If your company has the greatest new product but you are out of stock or can’t deliver in less than two days, you may lose the customer in the future. Maintaining operational excellence is as vital as creating memorable customer experiences.

12. Moving slow

Today’s companies move at lightspeed. If you measure in quarters and years, you will get eclipsed by a digital team that is measuring in days, weeks, and sprints.

13. Data overload

As a commerce team, you get tons of reports and conflicting signals from data. This can make it hard to figure out where to spend time and effort that will actually lead to results.

It’s up to you to set a small group of “input” KPIs that you control. These should lead to positive output metrics. For example, site conversion (input) will lead to revenue (output). Focus on your inputs to change your outputs.

14. Channel conflict

Companies that sell online and in-store may have channel conflict if the store team has its own income targets it needs to hit. They will often fight against the e-commerce initiative, even if it’s beneficial to the customer. Because they don’t get credit for online sales, there’s no reason to facilitate them.

Avoid this challenge by giving the e-commerce and store teams a single P/L statement and a set of target metrics that are customer-focused.

15. Maintaining developers for legacy system upkeep

Unless you choose an e-commerce service provider like Fabric, you’ll need an army of developers to keep your e-commerce experience up and running. Plus, competent developers who can manage the complexity of an old java application and monolithic backend are hard to find.

Conclusion

The biggest e-commerce challenges of today can be overcome by following some basic fundamentals. Create a customer-centric organization with a C-level committed to digital transformation. Reduce complexity and maximize operational efficiencies before adding new features. Implement the technical solutions that will allow you to scale and adapt quickly.

Topics: Commerce