5 Reasons Why E-commerce Businesses Fail

Most Common Reasons Why E-commerce Businesses Fail

Starting and running an online business is no easy feat. You have to dedicate your blood, sweat, and tears for it to be successful. E-commerce businesses are in high demand, especially in this era of Covid 19, which has locked many people to the confines of their homes. The increasing popularity is attributed to e-commerce businesses’ convenience, including the user-friendly best UK online casinos for customers who love staying indoors. Thanks to e-commerce businesses, you don’t have to leave your home to play your favorite slot machines or even shop for goods.

With the soaring popularity of e-commerce businesses, you would think that all of them should succeed, but they do not. Many brands have achieved exponential success, some of them completely selling out products a few hours after they are launched, and others failing miserably. A culmination of bad practices sets a foundation upon which many e-commerce businesses fail, whether they are already established or just starting.

So, what are the reasons that bring many e-commerce businesses to their knees?

Reasons Why E-commerce Businesses Fail

The following are contributing factors that lead to the miserable failure of a business:

1. Stiff Competition from Established E-commerce Companies

There are millions of websites out there engaging in cutthroat competition to sell products or services electronically. Enter a new website that offers goods similar to those sold by an established company. The new website will have to counter dominance from the already established business to survive. If the new website doesn’t sell quality products, market itself well, and practice resiliency, the owners will face extreme difficulty trying to grow their e-commerce business.

2. Failure to Sell the Right Products

New Ecommerce business owners should stamp their authority in the online business industry from the word go by selling the right goods to customers. Selling the wrong products to the right audience is one of the prime reasons why e-commerce businesses fail. To avoid selling the wrong products, business owners should do a market evaluation first to determine the best e-commerce business ideas. The best ideas usually involve products or services in high demand but have limited businesses offering them.

3. A Poor Marketing Strategy

No matter the kind of business, a strong marketing strategy is the foundation of success. Even major e-commerce businesses have marketing strategies to remind their customers of their products and attract new customers. Ecommerce business owners should invest heavily in promoting their businesses. A good marketing strategy is not limited to advertisements on television, print media, or huge billboards. Social media marketing can turn an idea into a profitable e-commerce business, and it has a wider reach to potential customers whose heads are always buried in phones.

4. Lack of SEO for Your Business Website

That an e-commerce business needs to have a website is painfully obvious. However, the buck doesn’t stop there; the websites need Search Engine Optimization to help e-commerce businesses to rank well in search engines. If a website is poorly structured and has poor content, customers who click to buy items get frustrated and leave the site as soon as they log in, increasing the bounce rate. Search engines take note of this customer behavior, interpreting it as a poor website that offers no value to its customers. Therefore, this website remains hidden in the dusty corners of search engines, and customers will not even see it, facilitating failure.

5. Lackluster Customer Support 

How do e-commerce businesses make money, if not for customers? Customers are the greatest assets to a business, so owners and staff should handle them effectively. A venture will not be among the leading e-commerce businesses available if customer relations are not a priority. Many businesses fail because of greed for money without caring if customers’ needs are fulfilled. Ignoring customer complaints, delivering faulty goods, a bogus return policy, and rude staff are among the reasons why a customer will never return to a particular e-commerce website. Bad publicity spreads fast, and with brutal online reviews, a business that handles customers poorly is bound to fail rapidly.


Ecommerce businesses have the advantage of customer preference because they are convenient. The ultimate goal for most businesses is to emulate the success of major e-commerce businesses. However, some e-commerce businesses fail to establish themselves because of poor practices that drag them backward. Businesses should consider having an SEO website, selling the right products, marketing them effectively, and prioritizing customer needs. By doing that, they are setting a clear path for themselves that will propel them to be some of the most profitable e-commerce businesses existing today.

Enjoyed reading this article? Do you have any suggestions? Let us know in the comments. We love reading your feedback!

Guest article written by: Christine J. Shepard is a professional business coach with a lot of experience in helping entrepreneurs cultivate healthy Ecommerce business practices. Christine firmly believes that owners should establish businesses upon a solid foundation with healthy business practices that will help steer their companies to achieving great and long-term success. 

Leave a Comment