Have you ever thought about launching your own e-commerce business but didn’t know where to start? You’re not alone. Nowadays, anyone can get an online store up and running in a matter of hours. That’s all well and good, unless, in your hurry, you pick the wrong platform and are forced to either start from scratch or live with a store that is less than perfect.
Pros of Launching an E-commerce Business
Low entry cost
The old-school brick-and-mortar procedure known so far was that you bought the products, rented, or purchased a shop or a warehouse for storing the goods. You have chosen resellers and, for big businesses, security personnel. In order to pre-finance these, sometimes a small fortune was needed. In the case of e-commerce, you will only need to buy or rent an online store and maybe rent a warehouse management facility. Part of the stock is only displayed in your e-commerce store, and you order it when a customer has made an actual purchase. This itself reduces your entry costs dramatically.
Launch from home
As explained in the previous section, we only need order-pickers instead of sellers. There is no real need for an actual building, so you can even run your own e-commerce store from your favorite chair at home. If you still opt for an office, the (expensive) street front solution is not necessary for a competitive advantage.
When you have a business, let’s say, for 10 years in one place, the locals have surely seen your company. You can collect potential customers from your city every day. You can, of course, still attract some people from nearby cities, in the absence of competition chances are even a bit higher. However, here “the game is over”, you have run out of opportunities.
In the case of an online store, this is not an issue. You can target a certain city, a whole country, or even the world.
With the exception of night-time shops and multinationals, only a few brick-and-mortars can offer a non-stop shopping experience. A webshop does not sleep, it does not go on holiday.
The sales are predicted to grow from 1.3 trillion in 2014 to 4.5 trillion in 2021.
When it comes to buying and remembering the buyer’s purchase, it fulfills the service. Selling at working hours is completely logical, but it’s also ironic. Most people work in working hours, they can not get their desired products during opening hours. For e-commerce, there’s no such thing as “open until 18:00, 23:00 or 03:00″. When the buyer wants to purchase something, the doors are wide open.
Source: Campaign Creators
Online marketing and search engine optimization is either a one-off cost (and a fragment of a poster campaign as such). It requires only one or two moderators. It’s an easy and efficient way to attract visitors to the website. In addition to the cost-effectiveness, performance is also outstanding.
Instead of expeditious costs for impersonal flyers and postcards, targeted Facebook campaigns, newsletters, direct marketing, and Google ads appear where the need arises.
However, there is still a need for offline advertising both online and offline. A good combination is the golden middle way.
Qualitative Website Analytics
To build a webshop that looks good and even has decent content on it is one of the most important steps you can take as an online business. But the real e-commerce challenges come when you open your gates to your target audience. Needless to say, results must be measured. In other words, without web analytics, you can not judge how your webshop performs, not to mention how and what quality of traffic your marketing efforts are producing.
Quantitative metrics can answer questions such as how much time users spend on your webshop or in what order they are browsing your products. But these indicators alone do not show the full picture. You won’t get a real answer to the question of Why. Why do they leave the shopping cart when it contains multiple items? Why are users behaving the way they do? Is there something wrong with the layout? Let’s say, for example, you would like to collect e-mails to build a new database. You decide to launch an advertisement where you offer free downloadable tutorials hoping your potential user will perform the desired action. Your analytics clearly shows that you get traffic on the landing page from your ad, but for some reason, they just bounce off. From a quantitative point of view, you should have a rough idea that the conversion process is stuck on the landing page, but what exactly happened in the background is still just estimates.
Even if there are visitors to your website who do not convert to paying customers, it’s important to keep track of their behavior on your website. You need to know exactly what you are doing on your site, which is beneficial to you for business and how you can replicate these interactions. This is where qualitative measurement comes into the spotlight. Sophisticated web analytics tools such as website heatmaps, session replay, event analytics are designed to answer that exact question:
Why do my visitors behaving like this?
One of the many e-commerce trends is that this type of business offers comfort not only for you but also for the visitor. The user does not have to travel, or to walk around in the store, queue at the cashier, and does not have to carry his/her heavy, large, or fragile goods home. The internet offers nearly unlimited information about goods and services and the energy investment of a search session consumes is very low.
In a non-e-commerce environment, the product on the shelf is tangible but the information provided to the buyer is very minimal and can come only from a limited source, for example, the staff.
Talking about comfort, voice shopping is predicted to grow to 55% by 2022.
Step up your game and get ready for the overwhelming popularity of artificial intelligence solutions in e-commerce.
Cons of Launching an E-commerce Business
Holding Your Position
The world of the Internet is known for being the hothouse of democracy, entrepreneurship, and capitalism. If someone comes up with better, cheaper, more appealing products, you can find yourself below the competition in minutes. If you are not a brand, then literally everyone is your competitor in the e-commerce field, who also solves the buyers’ problem. Time is luxury; you can not stall for a moment. Tip! If you decide to take the e-commerce entrepreneur path and have no experience in online marketing whatsoever, you should really consider hiring someone. Content marketing is also a great way to gain massive traffic by ranking yourself on the first page of google.
Reaching Older Generations
Source: Filipe Almeida
Generational gaps are a thing. Nowadays, we only have the second generation to be growing up in the technology world. This means only two generations use the internet instinctively. Now, this doesn’t mean that older generations are out of the target audience when it comes to e-commerce. Younger people are more open-minded when it comes to purchasing goods or services online. Members of generation Y represent a massive purchasing power. They have reached the age where they are financially independent.
Personalization is key!
In fact, 50% of shoppers said that personalization is important for them.
Tip! If you wish to target their grandparents with your e-commerce service, it’s a good idea to reach the younger age of the Internet users (up to 30 years) in your ads to help grandparents get access to online store products.
We have heard about several cases when there was no real business behind the store or even a company. The client has prepaid and has never received anything in return. These horror stories feed on e-commerce trust issues, despite the number of reputable stores. Subsequent payment at the receipt of the package is often chosen by customers for fear of getting scammed. But unfortunately, this solution offers very little to boost confidence, as the contents of the package, the quality of the goods, and warranty issues continue to worry about the customers.
Tip! You can build trust in many areas. Ask for comments from all your customers and publish them on a visible spot on your website. Make a PR video about your operations and stay active on every social media platform that fits your business profile. For example, if you launch an e-commerce website to sell dietary supplements; Instagram influencers can be a great opportunity to raise awareness and deal with trust issues.
Self-Hosted, or Hosted E-commerce Platforms
There is a multitude of e-commerce platforms available nowadays, each with their own unique features. The first step you need to take is to choose one of them to serve as the backbone of your e-commerce empire. And it all begins with a simple decision: hosted or self-hosted?
Self-Hosted E-Commerce Platforms
Launching an e-commerce webshop is very similar to what you would expect from a traditional website. If you have already created a WordPress site or blog then you already have some experience. Self-hosted e-commerce platforms are essentially open source applications running on web hosting services. When choosing an e-commerce platform you have to consider quite a lot of factors. These can be pricing, features, service, ease of use, etc.
Choose an open-source e-commerce platform (such as listed below) and you will exactly know what you will get. The most popular platforms are well documented and offer you the freedom of editing so you can make changes anytime. Worth noting that the latter is one of the main reasons why people pick self-hosted e-commerce platforms over hosted ones. If you’re missing certain functionalities, such as e-commerce traffic metrics, you can add these in the forms of website analytics plugins.
Another benefit of self-hosted platforms is that they can be set up anywhere. If you don’t like a certain web hosting service, you are free to differ. If you are relatively small you can choose a service that fits your business well, and transfer to another provider or package as you scale your e-commerce business.
“Sell on mobile, sell in-store, sell on a plane. Magento powers amazing omnichannel experiences, wherever your customer is.” — this reflects the mobile-friendly perspective of Magento, one of the top e-commerce portal engines. With its armory of features, it provides an abundance of solutions for e-commerce. It’s also very flexible and open-source. Worth noting that while Magento 1.x is still in use, you should consider Magento 2.
Not a designer? Do not fear. You can choose from multiple thousands of templates, from which many are based on their own platform. There are also quite a lot of third-party versions to pick from. All you have to do is pick the right one that fits you and your company like a glove. A little make-up here and there, and you have an appealing and stable webshop.
Ease of Administration:
Magento is not your typical “plug-and-play” engine. If you want to achieve a unique custom framework, be prepared, that it will require time, patience, and lots of expertise. Magento also offers great
Speaking of expertise, a skilled Magento specialist may even ask up to $250 per hour for the service. But wait, there’s more!
This won’t include regular maintenance. However, if you have a man qualified to do the magic, then basically Magento is a killer.
This engine provides a lot of plugins on a silver plate. You can compare Magento’s marketplace to Aladdin’s cave. Choose from free or paid content. Capturly’s plugin allows you to overhaul your Magento based webshop with the power of visual analytics. This way you can make sure, that every piece is where it should be.
What testifies to Magento’s epicness? – you might ask. Well, only “small companies” like Samsung, Nespresso, Olympus, or Ford.
In case you dream big, then you should make sure, that the engine has enough horsepower to run your business. In case you have to go with paid elements, you should check out the free services of other engines before you dive deep into your pockets.
Simplicity until the very end. If you want a shop that focuses on the product and its functionalities, or your target group has such desires, then you’re on the right track.
Ease of administration:
Crisp & clean, simply works out of the box and it is very pleasant to manage. The dashboard is one of Opencart’s biggest perks. Might not be as detailed and complex as Magento’s, but for someone who’s just gotten into the game, should be perfect. It has a decent user base, which means you can find plenty of help on forums, or go for the tech support in case you’re stuck.
It’s open-source, so you don’t have to pay a penny for the engine itself. If you find your plugin of choice in the free section, then you’re good to go. If not, well, you can pick one from a range of $10–$190.
There are more than 13,000 additional plugins from third-party sources. Yes, you heard it right, this number doesn’t include the stock plugins. All of these can be found in the marketplace of Opencart. It is worth noting, that not everything is made out of candy. Opencart has its own Achilles’ heel. Sometimes the usual update routine of the Opencart e-commerce plugins might cause a few of them to lose one or two functionalities after an update. Keep in mind that most of them come from third-parties and it’s hard to keep everything under control. In case you need visual analytics, you can try out Capturly’s plugin.
WooCommerce is not your typical webshop engine. In fact, it’s not even a real engine by itself. It’s more like an e-commerce plugin for WordPress, that supports CMS functions with a shopping cart.
If you go to ThemeForest you can choose from 400+ templates. This may seem very little compared to the other engines mentioned above, but keep in mind, we are talking about WordPress here. Since it’s based on WordPress, you have the opportunity to use around 6000 templates. That’s a reasonable amount even if not every single one of them is compatible.
Ease of administration:
WooCommerce can handle 10 or even 20 thousand products at the same time. In theory, at least. The practice is another thing since it can cause a real headache when the products admin surface freezes or gets so slow that it becomes nearly unmanageable. In addition, you have a ton of options when it comes to security.
When it comes to pricing, there are two factors influencing factors. One is templates, from which some of them can reach $50, and there are the paid modules of course. These can vary between $30—$110.
This is where Woocommerce really shines. It supports all kinds of WordPress plugins, as well as third-party versions. In this field it’s really unmatched, it’s far more flexible than the other engines, which in most cases, focus purely on their personal shops.
Woocommerce is the undisputed champion of plugins.
If you want some proof that it works, take a look at UPS, FedEx in transportation, PayPal, Amazon, and 2Checkout in payment, or Xero and FreshBooks in accounting. In case you want to see your site with the eyes of your visitors, then you can try Capturly’s plugin.
The Cons of Self-Hosted E-Commerce Platforms
- Not considering the expertise required to run a Magento webshop; hosted e-commerce platforms are usually more expensive. The costs scale greatly as the webshop attracts more visitors.
- The comfort comes with a price, as they offer very little and limited customization. Installing plugins is still an option, however, these need to be approved by the platform.
Hosted E-Commerce Platforms
If the cons I mentioned above scare you or simply you like something that works out of the box, then you should take hosted e-commerce platforms into consideration. These include the hosting service itself and extras such as shopping cart functionality or dedicated support. All you have to do is to pay the monthly fee and you get a well-oiled system. The fee often varies based on the size of the e-commerce business you wish to launch. In most cases, you have the opportunity to pay annually. Often this way you can get a free month.
Another benefit a hosted e-commerce platform has to offer is that you don’t have to worry about maintenance/technical management at all. You can purely focus on the business aspect of your webshop. You still have to fill it with contents and manage your inventory, but other than that it just works. Even if you max out your budget by opting for premium support, you can still come out cheaper than for example hiring a Magento expert.
It’s a very aesthetically pleasing and popular platform with huge background support. You have the option to sell through your Facebook page and with the aid of the Shopify Buy Button even your webpage or blog can be turned into a sales machine. Do you need more fun? Well then, Paypal and Mailchimp integration is another option for you that doesn’t require any voodoo magic. The cherry on top is that it can also be used as a point of sale tool. This means, that if you take a step towards retail and want to make your and the customer’s life easier, you can just throw a tablet on the counter and Shopify turns into a cash register.
This engine might not be the king of templates, but it gives you one of the cleanest, minimalistic designs. On top of that, many free templates look really really good and professional.
Ease of administration:
When it comes to the back-end, you’ll get a handy-dandy system. This e-commerce platform is 100% beginner-friendly.
No wonder that it’s one of the most common e-commerce platforms out there. And the community built around it is simply amazing. The forums and the active user base come to your aid in your time of need.
The $29 for the basic pack is everything but cheap. Not to mention if you like to fly around limitless, in that case, you’ll have to open your wallet 10 times wider.
“The life of kings starts at $299 per month.”
Also the transaction fee is around 2,9% + an additional $0,30. This might be absurd at first sight but it’s completely normal when it comes to e-commerce. Before you turn your back, take the fact into consideration that every penny of it leads to customer satisfaction.
“Existing or potential customers doesn’t matter; if they’re happy, you’re happy.”
Thanks to Shopify’s app-store there are plenty of plugins to serve your needs. Marketing, sales, transportation, stock control, customer service, SEO support, reports, and analytics, including Capturly’s visual analytic features are all available.
Tip: mobile optimization is a huge thing in 2020!
81% of Shopify’s traffic is from mobile devices.
The Cons of Hosted E-Commerce Platforms
- Hosted e-commerce platforms generally cost more than their self-hosted counterparts.
- Your monthly or annual fees will grow as your store attracts more traffic and requires more powerful features.
- Customization possibilities, while available, will be limited. You will only be able to use pre-approved themes and plugins. This protects you from a security standpoint but can be stifling in terms of creativity and limit the store features you can implement.
- Switching platforms is costly and time-consuming, if not impossible, depending on the scope of your store.
Common Mistakes and How to Deal With Them
Did I promote myself the right way?
“I offered 50% off everything plus free shipping, yet nobody cared..”
If you did that, then you did partially good only. First and foremost, you need to think ahead and decide which products should be discounted. You need to figure out a product that will be your customer magnet. Going for all in is not the way. It will just draw away valuable attention from the leading product. There are two options in your hand: you either knock down the price of an already popular item or push the cart of a dwindling one.
Why did I run out of stock?
Source: Jodie Walton
“Few items ran out of stock, then the shoppers left.”
Oh, the shame of the “Out of stock” sign hanging on your page. So close yet so far away. You might have stocked, but did you have enough of the leading product? Don’t underestimate the shopping power of events like Cyber Monday: Adobe’s Digital Index pointed out that last year the online sale revenue reached $3 billion! Be sure to pile up as many supplies as you can from the sale products. Take into account that there might be hiccups with your subcontractors, as you aren’t the only one who orders larger quantities for Cyber Monday.
Was I really Prepared?
“I don’t get it, I’ve started planning a week before the events!”
If you don’t start the preparations one or two months before the big shopping events such as Black Friday, Cyber Monday. And of course, if you forget to create a Christmas themed webshop layout, then you’re most likely running with scissors. In the last phase of your planning scenario, you should start preselling. Prepare some smaller sales for the days preceding Black Friday. Starting the sales earlier also provides a chance to get rid of the less attractive stocks and distribute customer attention evenly. Implement intelligent search on your webshop, this will make products much simpler to find, and that’s exactly what users want.
“Pre-selling is like a trailer of a movie you’re interested in.”
But it is also great for testing your website if it can hold bigger traffic than usual!
What Did My Competitors Do?
“I can’t compete with the big companies anyway.”
Wrong. It’s not about you can or can’t, it’s about finding your spot on the market and choosing your offers according to that. The fact is, that there will be enough competitors on your level. Stay focused, don’t let them be the winners of Black Friday or Cyber Monday! Study their marketing strategy, special coupons, and their prices! It also pays off to come up with a unique, one-of-a-kind offer. Take a look at what the industry veterans are doing. Borrow ideas from big-name retailers, because they know what they are doing.
Create personalized offers with well-crafted Call To Action words that fit into the theme. Cater to different target demographics with varying tastes and preferences. Analyze the data you have about the expectable audience, and turn the gap between the visitor’s age, gender, and location to your advantage.
What about aesthetics?
Make sure your webshop’s components mirror your vision and put out eye candies that center around your top-selling items. It goes without saying that all design-related tasks should be prepared in advance. A dedicated landing page and a storefront highlighting your best-sellers are also must-haves. Applying landing pages with counters and “eye candy” can immediately attract the attention of the customers who are on the lookout for limited offers and massive discounts. You need to have a properly-contrasted Call-to-Action button that is well-visible in the above-the-fold area. Take great care when designing this element and make it recognizable for the visually impaired.
How was the shopping experience?
Source: Carl Raw
The sudden change in design and layout may yield unexpected glitches or poor performance, which leads to dropping conversion rates. Keep in mind that these two holidays produce the largest traffic in the whole year! Ensure the website handles the increased traffic. Don’t be afraid of optimization tools. They exist for a reason.
“There are a ton of them out there that you can choose from.”
Speaking of optimization, you’ll have to make sure, that your fancy new redesigned website won’t take too much time away from your customers.
It has to be silky smooth and super fast. You should compress the images properly, since buffering high-res photos can take decades. If you skip this part, then there is a chance that your visitors will skip your shopping cart too.
You also could get rid of unused scripts, that run in the background. I know they don’t eat too much, but on major events like Black Friday and Cyber Monday, the traffic increases and as I said earlier, every millisecond counts. “Member?” Next time make sure that you test your speed on GTmetrix.
When the users/customers of your e-commerce website decide to purchase a specific item, recommend to them the corresponding accessories, or another item that makes a good match with it. Keep visitors circulating in your webshop even after they purchased something by revealing ads for additional sales. According to statistics, a large percentage of visitors who receive abandoned cart alerts will return and finish their purchase. So never give up hope! An effective alert should be personalized and quick. You can also emphasize urgency by revealing the dropping stock levels. This adds a “ticking clock” effect that plays on the customer’s fear of missing out on something. Next time use interstitials as the last move to turn the leaving one’s back. Optimonk’s exit-intent technology allows you to detect the moment they try to exit your site and display a targeted offer to your visitors. Exit-intent popups are a great way to attract almost leaving customers back to purchase. These prove to be very effective, like one last chance to grab the attention of existing customers with a special deal or huge discount. And the same applies here: DESIGN IS KING!