The E-Commerce Scalability Problem: Why You Can’t Afford to Wait

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Growth is the goal of any business, no matter its size. At any given point in your business development, you will be looking to grow your company, your impact in the marketplace, your customer base, and your revenue. However, wanting to grow often comes with its challenges, most notably: scalability.

Why is Scalability a Challenge?

All companies need to be scalable – or prepared to adapt to change and growth – to progress and expand their business. This rings even more true for SMBs, who have the most significant potential for growth (and biggest margin for error).

But, while most businesses understand the importance of being scalable, they also often feel the need to choose between a scalable solution that is future-proof (but expensive in the short-term), or an affordable, temporary solution that would require them to resolve their scalability issues on the fly. More often than not, the choice to keep costs low takes presence over investing in future-proof business strategies.

If your business is not scalable yet, or if you’re not worrying about scalability, you need to be. Here’s why:

1. Your Web Performance Directly Impacts Your Bottom Line

Businesses often worry more about the design and functionality of their website than its performance (but that’s just as, if not more, important.)

Your customers are constantly wanting more from your web store, and becoming less patient with subpar experiences.

Page Load Time - Sana Commerce

Nearly half of customers expect your webpage to load in 2 seconds or less, and 57% would abandon a page that takes three seconds or more to load (based entirely on page load speed).

Here’s how businesses’ current webpage load speeds are stacking up across industries (Hint: they’re falling far below expectations).

Load Load Time Averages Global - Sana Commerce

On average, websites on desktop take about 10 seconds to load, and even the strongest e-commerce sites take 4.9 seconds to serve any usable content at all.

According to Conversion XL, at peak traffic times, most customers won’t even bother risking slow performance. More than 75% of online consumers abandon a site experiencing peak traffic volumes for a competitor’s site – simply to avoid suffering possible delays.

Peak traffic volumes should be an opportunity to convert a visitor into a customer, not a game of risk. You need to know that your site is going to perform well at any given time, especially under pressure. That’s where scalability becomes crucial.

2. Even the Most Successful E-Commerce Giants are Falling Short

If you think scalability is just about throwing money at a problem to make it go away, you’re in for a major disappointment. Scalability is certainly an investment, but it must be gradual, strategic, and executed purposefully. Otherwise, even the strongest companies in e-commerce will fail to properly scale their operations. Here’s an example:

Two years ago, e-commerce sales in the US grew by over 15%. This is a staggering number, but it was made up primarily of Amazon’s revenue growth. In fact, Amazon’s 2016 revenue accounted for 66% of the $53.1 billion growth in U.S. online retail.

Over the years, Amazon has become not only an e-commerce giant, but an example for other businesses on how to master online sales, customer service, and order fulfillment. Still, even e-commerce’s superstar has gotten scalability wrong, in a major way, year-after-year.

Amazon’s huge Prime Day promotion has caused a shopping frenzy (and driven billions of dollars in revenue since 2015). The data speaks for itself:

Amazon Prime Day Sales 2015-2018

But, every year that Prime Day has existed, Amazon has been unable to properly prepare for the surge in traffic, whether that has meant glitchy checkout processes, unforeseen errors, and total site crashes. Their e-commerce experience has suffered, and they have lost customers and lost revenue in massive quantities (read: millions upon millions of dollars). For details on this year’s fiasco, and the scalability lessons you can learn from it, read our recent blog.

Now, if a company like Amazon can’t get it 100% right, the challenge is even more difficult for just about every other, less-equipped business. While you could argue that implementing your scalability strategy can wait, there’s also a major risk in waiting too long:

3. An Unprepared Business May Not Survive Major Scalability Challenges

Many businesses make the mistake of having “too much of a here-and-now mindset,” when it comes to approaching scalability. It’s often less about all the future business potential that they can prepare for, and more about how they can temporarily handle issues without driving their costs up. The reality, though, is that a business may need a complete infrastructure overhaul, and if so, the added costs are inevitable.

These businesses may choose not to invest in making their business processes scalable in order to avoid stretching their limited resources and budget in the short-term. This means having to field scalability challenges ad hoc – which businesses may not be ready to handle — and risking having their business plateau, or become obsolete entirely.

Don’t be short-sighted. Keep your business afloat today, but also be ready to let it thrive tomorrow. For more tips on tackling webstore scalability with ERP-driven e-commerce, read our factsheet.

Sana Commerce - Download Scalability Factsheet

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