Top eCommerce Challenges for 2023 and How to Overcome Them

Challenge 1: Rising customer expectations

Advances in technology are forcing brands and e-commerce store owners to keep up with an increasingly demanding customer base. Consumers want a shopping experience that’s simple and convenient, personalized and engaging. They want to be able to track their orders, shop across multiple channels, and receive real-time updates on the status of their orders and deliveries.

To keep pace, small e-commerce businesses must anticipate consumer expectations and meet those expectations. The best ways to achieve this goal are indirect research and direct communication. For example, after-sales surveys, social media monitoring, and direct communication with the support team are all ways to collect information about customer expectations and complaints.

Businesses need to understand buyers’ key pain points and design solutions based on their feedback. Some of these solutions include the following:

• Self-service possibilities. Self-service may include chatbots on websites or mobile apps that answer questions or assist with order-related queries. With 24/7 support, customers can ask questions anytime and get answers quickly.
• Various shipping and pickup options. Customers have different needs when it comes to delivery options. Some people prefer in-store pickup, and others may want free next day shipping or next day delivery.
• Different payment options. Not everyone is comfortable with online credit cards. Some people prefer to pay with other online payment services or use cash on delivery.
• Simple payment process. When customers checkout, they shouldn’t have to fill out many fields with their personal information each time. Instead, they should have the ability to save information to purchase items faster in the future.

Challenge 2: Competition from direct-to-consumer brands

Direct-to-consumer (D2C) brands sell products or services directly to customers instead of using resellers or distributors. These brands have been around for a while, but they have come to the fore during the pandemic.

The D2C e-commerce market grew significantly in 2020, according to Smart Insights, reaching $111.54 billion. This increase is not surprising given the delay in supply chains, order delays and the closure of in-person retail caused by the pandemic.

For example, the SaaS industry has seen the fastest growth among D2C companies. Innovative software has become accessible even to customers with modest budgets, thanks to subscription-based pricing models. By cutting out the middleman, D2C brands can deliver quality at lower prices.

As most D2C brands start with meager marketing budgets, they develop innovative marketing strategies. Tactics like influencer marketing, content marketing, and personalization can help attract new customers and build long-term customer loyalty. Some D2C brands create online communities where customers can actively shape the product development roadmap.

To shape this roadmap, brands can take the following steps:

• Build a strong online presence and product catalog.
• Produce high-quality content regularly to engage target audiences through different channels.
• Deliver seamless user and shopping experiences.

These steps can help gather valuable information about customer needs and provide products and services that meet those needs.

Challenge 3: Trading Across Borders

Cross-border trade emphasizes the advancements that e-commerce has made in recent years and offers retailers new opportunities to grow their business by tapping into previously inaccessible markets.

However, this growth comes at a cost for some online retailers. Some challenges include the following:

• Cross border delivery. This can be tricky, especially if third parties are handling the shipping. E-commerce companies that operate internationally should consider having a network of local warehouses instead of a single central headquarters. While not cheap, warehouse networks can streamline shipping, reduce the risk of lost merchandise, and lower costs.
• Language barrier. Most e-commerce platforms only offer support in their native language, although players like Shopify and BigCommerce are making improvements. This can cause delays in resolving issues, such as customer complaints. Merchants who wish to benefit from cross-border trade should offer support in multiple languages. Investing in multilingual customer support can dramatically improve customer satisfaction and boost sales.
• Currencies. In some cross-border scenarios, currencies differ from country to country, making price calculations more complex and costly for the retailer. Partnering with payment processing providers that can support transactions in multiple currencies can help businesses trade across borders and transact in foreign currencies.

Challenge 4: Consistency across channels

Improving CX also means ensuring a consistent experience across all channels. The omnichannel experience requires brands to be present on different platforms, as long as those channels are tailored to the brand’s target consumers. More importantly, brands need to deliver a seamless experience across all channels.

Consumers need to be able to shop easily across all channels without encountering issues or inconsistencies in customer service, product availability, pricing, content, delivery options, etc. This requires brands to understand their target audience, what motivates them, and how they make decisions.

To create consistency across all channels, companies should ensure that the following points are consistent:

• company history;
• messaging;
• products and services;
• look, including logo, typography, layout, etc. ; and
• customer interactions through different touchpoints – such as phone calls and live chats – and through different communication tools, such as email and social media.

Challenge 5: Data security

Data security is one of the biggest challenges in e-commerce, and it will continue to be in 2023.

Companies are putting a lot of effort into developing data-driven e-commerce services. These services can help brands with shipping, retail management, and multi-channel approaches, such as buy online, collect in store, and buy online, ship to store.

However, the amount of data that needs to be processed and stored is enormous – from customer profiles and purchase histories to website analytics and inventory management data. Moreover, all this data must be secured against cyberattacks, data breaches, viruses, hacking attempts and more. Addressing these data security issues requires an IT infrastructure capable of handling huge amounts of data to ensure its security and privacy.

For example, when it comes to choosing a payment processor, companies should primarily focus on compliance with the Payment Card Industry Data Security Standard, which is the minimum level of security for processing online transactions.

Businesses can also benefit from the expertise and support of payment service providers, who offer:

• On-site penetration testing for fraud detection. These tests minimize the risk of compromising sensitive data and provide peace of mind to merchants and their customers.
• Encryption of sensitive data. As hackers get smarter and security breaches become more common, businesses need strong encryption algorithms to protect their customers’ personal data, especially when it’s transmitted over the Internet.
• Tokenization of payment identifiers. While encrypted credit card information prevents unauthorized users from accessing it, tokenization renders the information useless in the event of theft, effectively reducing the risk of fraudulent charges.

The bottom line

In 2023, the e-commerce industry will continue to grow. Due to its fast-paced nature and ever-changing business environments, we can expect more challenges in 2023. Consumer behavior will continue to change, data security threats will continue to increase, and the boundaries between physical and digital purchases will continue to fade.

However, companies that follow these trends will be able to seize opportunities to increase revenue and boost sales.

About the Author
Robert Brandl’s passion has always been web tools that make life easier. That’s why he founded Tooltester, where you can find reviews and tutorials for the world’s best website builders, e-commerce platforms, and web hosting services.