Common Reasons for an eCommerce Startup Failure

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Common Reasons for an eCommerce Startup Failure - Sigma Reading Time: 4 minutes
Common Reasons for an eCommerce Startup Failure - sigma

eCommerce startups are the new thing, especially after the breakout of the COVID pandemic. All the new startups want to expand their business online, but a lot of planning and effort is needed to succeed. On average, there are 12-24 million eCommerce websites across the globe, and nearly 22% of them fail within a year. Therefore, it is to be understood that even though there is a demand for online startups, their survival is not guaranteed because of the fierce competition. You not only need to be original and creative but also have that knack for understanding your competitors across the world to grab new and massive opportunities.

We have created a list of some reasons why eCommerce startups fail and are not able to capitalize on the opportunities that come their way:

Poor Marketing Strategies

One of the primary reasons for any eCommerce startup’s failure is to market the products and offerings properly. When you are competing against world-class giants like Amazon, Flipkart, and eBay, it is necessary that you promote your brand and do it in a way that connects with the customers. You can market your products on various social media platforms like Facebook, Instagram, or other convenient platforms in the beginning. Once you establish a connection with people, even Google starts identifying those searches and preferences of customers, which automatically boosts your marketing campaign. You can then reach out to more potential buyers at once.

No Proper Pricing

Once you have got a hold of what you want to sell and people are showing interest in your product, the only thing that can stop the eCommerce startup from gaining success is a poor pricing strategy. Your products’ prices should be reasonable and in line with the price prevailing in the market for the same things to make the startup a success. Also, keep in mind that no one will be interested in your startup if your competitors sell the same thing at a lower price. To avoid failure, you can focus on one thing that attracts customers, especially towards new eCommerce startups, which is cheaper or reasonable prices and discounts. Customers can also be given various rebates and coupons, especially first-time customers in shipping or delivery charges. The first delivery of the product can also be made free involving dynamic pricing powered by AI/ML. These offers should be pushed continuously to attract new and old customers and to maintain a buzz about your startup in the market. These tips will help to avoid the failure of the startup.

Poor Web Design

The eCommerce platform designs also play a crucial role in the success or failure of any eCommerce startup. You don’t want your potential customers to land on your landing page and leave straight away because they could not understand or could not find what they are looking for. Always keep in mind that even though online shopping is at an all-time high, still people think twice before giving out the details of their debit or credit card, so your eCommerce startup should not look sketchy. Keep your eCommerce store simple, customer-friendly, strong, and not too complicated to operate, and aim to build trust and brand name with the potential customers. Have a good web design to attract more customers and avoid this reason for your eCommerce startup’s failure.

Not Proper Guidance

This is also a significant problem for eCommerce startups failures. Once the customers have found the product(s) they want to buy and want to add to the cart, if the customers do not get clear instructions to finalize the cart and pay for them, this may lead to the failure of your ultimate goal. You should pay extra attention because options like add to cart or buy should be duly highlighted and visible clearly. Also, ensure that your website is always guiding the users as to where they should go or what they should do next, especially to finalize the purchase of things added to the cart or, in other words making sure to complete the sale. So the design of your startup should be comparatively easy and should cater to the ease of customer navigation around conveniently.


It is advised for all new eCommerce startups to offer a unique product and one of its kind. Having unique and new products to offer the customers gives a startup a competitive advantage. Also, contributing to corporate responsibility or being a part of any charity organization is an excellent way to make the target audience interested in the business and also in doing good for society.


If you are launching your eCommerce startup or are already a proud owner of one and looking to expand the business, paying attention to these tips will help your business thrive exponentially. These tips will help you succeed in your dream eCommerce business.

Looking for a trusted eCommerce partner to create, design, and host your new online store with the world’s leading technologies? Feel free to explore our success stories to leverage the trends from evolving eCommerce landscape that can help you deliver an extraordinary eCommerce experience.