Chapter 3: barriers to e-commerce adoption

 

Despite the prevalence of the internet in most people's daily life, there are still significant concerns for many small business owners about trading online. Those covered in our survey, who have well developed e-commerce operations, still mentioned the new set of challenges that starting an online business presents.

 

To assist British entrepreneurs in grasping the online revenue opportunities we have identified the perceived barriers to market entry:

 

• Can customers find you online? - 57% feel that generating traffic and getting customers to their site is the greatest challenge to trading online
• Fraud losses? - 33% fear they will be victims of fraud and hit with the consequent losses
• The silent scream of the unloved customer? - 31% feel that trading online means a lack of interaction with customers
• High costs? - 23% are resistant to moving to trade online due to perceived costs of doing business online
• Compliance and regulatory change? - Over one fifth (22%) struggle to keep abreast of changes to the regulatory environment

 

We can see that in a large number of cases small business owners in Britain are applying the norms of conventional business to online trading. The greatest concerns are: by creating an online platform they either won’t have enough contact with customers to build a strong commercial relationship (31%); or for over half (57%) that customers will not be able to find them on the web - in both cases, issues that are part of establishing a business, but have a greater impact on the online retailer.

 

A key challenge noted by approximately a third of the small businesses surveyed was the severe risk of fraud and a further fifth of respondents mentioned keeping up with the regulatory and compliance environment around online payments. It is clear that these areas appear daunting to the would be entrepreneur or the business looking to move online. However, there are clear advantages to trading online that require an evolution in how you approach business.

 

The advantages to an online trading platform are straightforward however, there are barriers to adoption.

 

To read this chapter in its entirety, go to the full report.

 

Chapter 4 summary >>