What exactly is e-commerce?
E-commerce means the commercial transactions that are conducted using the internet medium. In other words, whenever you buy or sell something using the internet, then that is called as e-commerce. The first e-commerce transaction happened on August 11, 1994, around noon. Phil Brandenberger of Philadelphia used his credit card online to buy Sting’s “Ten Summoners’ Tales” for $12.48. This article will throw light on the 15 lessons about e-commerce for success.
What are the 15 lessons about e-commerce you need to learn to succeed
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Entrepreneurship can happen by accident
Vaitheeswaran the pioneer of e-commerce did not initially want to become an entrepreneur, while he was busy with his first job as a sales engineer and even while he was a student. The entrepreneurship bug bit him when in Wipro, in 1998, when he came across www.hotmail.com and www.amazon.com.
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Launching a startup is a combination of bravery and stupidity
In order to launch a startup, a person has to be brave enough to keep fighting on the path of entrepreneurship until one succeeds. At the same time, he should also stupid enough to leave out the comforts of a plush corporate job to turn entrepreneur.
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Co-founders must have worked together before
Co-founders must have a record of having been together earlier, either in school or college or in the same organization as work colleagues. Additionally, they should have complementary skillsets. Although, the story of successful dropouts seems very romantic, such instances are very rare.
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Be a pioneer
Emerging trends in the e-commerce industry today, talk of shopping via virtual reality and augmented reality. Only those companies are successful who have something new and innovative for the customer. Companies who win in this game are typically ones who are at the leading edge or cutting edge.
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Be frugal
Success comes only to those who do things on their own. It is true that in the world of hyper-funded startups, it sounds fancy to spend money on getting surveys done and employing expensive people to do menial jobs. However, bootstrapping is the key to success.
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E-commerce is about both breadth and depth
Although some e-commerce players have gone down the niche-offering path, e-commerce works well with the breadth and depth of business. A retailer first started with selling cassettes and CDs, then to books and then on to hundreds of other categories. Increasing margins and keeping costs down is the name of the game.
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Metrics
The key metrics that should be monitored are selection of merchandise, pricing and availability. E-commerce sites should focus on improving parameters like net promoters score, customer retention cost and customer repeat rates. Restricting the focus only to vanity metrics like social media likes is not the way to go.
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Manage customer behavior, customer experience and customer service
Retailing software is all about improving your customer experience. Initially, it was believed that Indians like to touch and feel the product they buy and therefore, online shopping may not succeed in India. However, all that is changing now, thanks to online payment systems, superior customer cash-backs offered by online payment systems, and better ecommerce support thanks to new tools like ChannelReply.
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Be flexible for the ever-changing scenarios
Notwithstanding the dotcom bust of 2000 and the financial crisis of 2007-8, e-commerce is here to stay piggybacking on online payment systems. New wave of startups is rolling out deep discounts and free shipping in order to get business. However, they should be ready to roll up their prices if their bottom lines are hit.
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Crisis is a test of friendship and support
In entrepreneurship, a crisis actually shows you who your friends and supporters are. People who have failed in entrepreneurship have learnt it the hard way that a friend or a foe can be recognized in crises. Thus, a crisis is necessary in an entrepreneur’s life to judge family and friend support.
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Have a sense of humor
Unsuccessful entrepreneurs have said that accumulating millions of frequent flier miles does not make one a pilot. This means even if an entrepreneur does his thing many times, if his efforts do not get him success, then he should abandon his efforts.
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Understand the investor game
It is very important that co-founders have sufficient stake in the business to keep them motivated enough to continue. In addition, this will ensure that they have sufficient control over their business. Investors generally ask for management control in return for the money they put in. This should be avoided in the interests of success of the business.
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Laws governing e-commerce startups are not strong enough
FD laws in India are not strong enough or cannot be properly enforced. India also needs better laws in the area of startups. Good lawyers and accountants should be trained who can work for startups.
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Indian attitude towards failures is one of criticism
In India, success is attributed to the whole team but failure is attributed to one individual. This practice has to change, if startup ecosystem has to succeed.
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E-commerce startups should invest a lot of time in their ideas
The founders of e-commerce startups should treat their businesses as their babies and grow them accordingly.