Understanding The True Cost Of Ecommerce Downtime

January 7th, 2019
Estimated read time: 4 minutes, 46 seconds

Ecommerce downtime can cost your business a lot more than money. Opportunity, productivity, brand perception, and SEO damage are just a few examples of collateral your brand could suffer in the wake of an outage. With commerce moving steadily toward an almost entirely digital experience, a minute’s downtime is a minute too long.

Whether you’re selling software, SaaS, or digital products, your online store needs to have processes in place to ensure that you’re operational around the clock––and avoid consequences that go beyond revenue loss. Here’s a closer look at what downtime means for ecommerce businesses:

Opportunity And Productivity Considerations

In the world of digital commerce, downtime is equivalent to turning customers away at the door of your brick and mortar store. There’s nothing stopping customers from navigating away from your site or visiting a different online storefront, costing you a lost sale and worse – potentially a lost customer. When your income depends on the availability of your site, you need measures in place to ensure your business runs smoothly and continuously.

While some online business owners think that short periods of downtime may not be as devastating, they are mistaken. According to Gremlin, a provider of chaos engineering and failure testing tools, Amazon loses approximately $220,000 per minute of downtime. Even if your business doesn’t run the risk of losing as much revenue as Amazon, you should nevertheless treat outages with the urgency they demand.

A Bad First Impression Can Cost You Money

First impressions matter!

New customers have no previous experience with your business, so initial interactions play a huge role in determining their likelihood of returning. Nothing turns a prospective customer away faster than a company that’s not ready to conduct business when expected. This places the need for a stable, predictable, and well-supported infrastructure at center stage.

While it’s good to invest time into developing and improving the quality of your software or service, it’s also equally as important to make sure you’re investing time into your ecommerce solution. Vetting ecommerce platforms early helps ensure that your product is supported by a solution that’s reliable, performs well under heavy loads, and includes the support of a knowledgeable and capable team.

Measuring The Cost Of Downtime

Countless hours of marketing have gone into building your reputation as a leading ecommerce business. Your reputation has to be good, if not impeccable. The digital commerce industry is constantly evolving, with new players entering the market daily. Maintaining a stable ecommerce site that helps customers easily shop for the software or service they need is one way to help separate your business from the crowd.

It goes without saying that selling digital products online is wholly dependent on the uptime of your site. If you can’t guarantee this, your business is at risk of losing a substantial amount of income in the event of extensive downtime. According to some estimates, losing just one customer can set a SaaS company back by approximately $650 in an hour.

Damage To SEO

Downtime can have a serious negative impact on your search engine rankings. By the time your site is up and running again, search engines like Google or Bing may have given your competitors higher rankings due to their availability. With the risk being time-dependent, you still don’t want your website to be temporarily replaced with a site that is running – especially if that site is a direct competitor.

Google engineer Matt Cutts explains that while short outages may not be as serious as longer ones, their detrimental effect is undeniable. You’ve spent considerable time growing the SEO value of your site, make sure you protect your position in Google’s index so you don’t have to start your SEO efforts all over again.

A Few Realities Around Downtime To Consider

In truth, there simply is no such thing as 100% uptime. The reality is that wherever your business technology may be hosted, hardware, software, human or a combination of these factors can and do cause systems unavailability. The goal then is to minimize the likelihood of these occurrences as much as possible. Hosted environments can bring you as close to the elusive 100% uptime as technologically possible, thanks to massive advances in cloud, server, virtualization, storage, and other technologies.

Another option is to distribute your technology in the form of hybrid platforms that include both hosted and in-house systems for added redundancy. Note, however, that this does incur further running costs to your operations.

There are still, however, ways for ecommerce companies to mitigate the consequences of downtime when they do occur. Open and upfront communications with customers on expected outages are crucial to managing expectations for service availability. If scheduled downtime is upgrade related, communicate this and use it as a way to highlight new features customers can expect. If an outage or disruption in service is unexpected or unavoidable, follow up with customers and provide a brief, but sincere explanation for the situation.

Remember, good customer service is especially important when things run less than smoothly!

Protect Your Business From Downtime Woes

While downtime is and will be a reality in our hyperconnected world, that doesn’t mean it has to upend your business’ goals. FastSpring’s all-in-one ecommerce platform partners with your business to enable you to get to market faster and unlock more sales around the world. Our secure platform is designed to support a full spectrum of digital products and enables purchases & subscriptions across web, mobile, and in-app experiences.

Interested in learning more about how FastSpring’s ecommerce platform can help you monetize your digital products or services? Click here to speak with one of our platform experts.

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