In January 2016, Internet Retailer reported that online sales in the US are expected to reach $523 billion in the next five years, up 56% from $335 billion in 2015.
Consumer preference and improvement in technology are driving eCommerce growth. Consumers demand the ease, convenience, and quickness of online shopping. Retailers are making the necessary improvements to meet those demands allowing consumers to shop as they want.
eCommerce is a big opportunity for both emerging and established retailers. Do you think you’re ready to tackle the world of eCommerce? Read our guide of eCommerce basics before you do!
What is eCommerce?
This might seem like a no brainer, but nonetheless let’s cover it.
eCommerce is any commercial transaction that’s conducted electronically on the internet.
This definition shows the breadth of eCommerce selling. eCommerce includes marketplaces like Amazon and eBay, brand’s webstores like Home Depot, social media like Facebook and Pinterest, and everything in between. It’s wherever you make a purchase online.
For the sake of the longevity of this post, we’re going to focus on the basics of creating your own webstore.
The Basics of eCommerce
When creating your own webstore, you should start with these areas. They will help create a good foundation for your business.
Choose Your Product and Market
This may seem obvious. You need to know what you want to sell and who you want to sell it to!
The great part about selling online is that practically anyone can sell anything. However, that doesn’t mean that you’ll be successful. There’s probably not a big market for people who want to buy avant-garde style underwear!
Successful eCommerce sellers do research to find a product to sell to a niche market. Shopify, a leading eCommerce platform provider, put together a great guide about how to find a product to sell online.
If you already know what you want to sell, then you’re one step ahead.
Choose Your Platform
Now that you know what you want to sell, you have to find a place to sell it. Enter an eCommerce platform. It’s software you use to create and manage a webstore.
There are two routes you can go when choosing a platform:
Open source platforms give you access to modify the platform’s code. This provides endless creative freedom when designing and configuring your website.
Open source platforms usually require an in-house team of developers. They can create and manage your webstore by customizing code for unique functionality. You’ll have complete control.
Out of the Box
If you want to get up and running more quickly, you should look for an out of the box eCommerce solution. These type of solutions are set-up and hosted for you. You don’t have to custom design your website, instead you pick from pre-built themes.
The type of platform you choose will affect cost and level of management needed to run the platform. Open source platforms tend to be more expensive, but you’ll be in complete control of your website. Out of the box platforms are more cost-effective and you’ll have less to worry about.
Check out this article that details some differences between eCommerce platforms.
Design Your Website
The eCommerce solution you choose determines the amount of design work needed. An open source platform most likely requires work with a web design partner to create the site of your dreams. Other platforms allow you to choose from different themes, which gets you up and running faster.
When it comes to design, consider your brand image and how quickly you need to get started. The design stage can be lengthy and costly if you’re looking for something very specific or complex.
Choose a Payment Solution
To be able to sell online, you have to accept payment from your customers. And to do that, merchants need a payment solution.
All online sellers must be PCI compliant. This ensures that you’re safeguarding your customers’ payment card information.
Use these article to help you evaluate and choose a payment solution.
- A Guide to Payment Solutions for eCommerce Sellers
- Top 5 Online Payment Solutions for Online Retailers
Decide on Fulfillment Method
Once your customers pay, then you have to ship their order to them! There’s a few different ways to fulfill orders.
The first option is to fulfill them yourself. You can print and attach the shipping labels, then ship the item. When just starting out, this is usually most cost-effective. There’s even software to help you be more efficient.
Use a 3PL
Once your business grows, however, you should consider outsourcing your fulfillment. Online retailers can use 3rd-Party logistics companies to store, pick, pack, and ship their online orders.
If you haven’t heard of 3PLs before, check out our beginner’s guide to using 3PLs.
Optimize Site for Conversion
It’s not enough to just design a pretty layout for your website. Your design should intentionally provide a customer experience that’s optimized for conversion. If it doesn’t, you’re leaving money on the table.
When it comes to optimizing for conversion, you need to think about these areas:
- Responsive design for mobile users
- Easy product search capabilities
- Quality product content
- Easy, fast checkout process
- Customer reviews
To learn more about these areas in detail, see our article 5 Quick eCommerce Conversion Optimization Tips.
All online sellers have to deal with returns. It’s a crucial process of online selling.
At the very least, merchants need a return policy that is visible to customers. This builds trusts with customers and sets their expectations right away.
Handling returns can be a daunting task. It pays off though for retailers who take the time to do it right.
95% of online customers will purchase again from a merchant who provides a good return or exchange experience.
Integrate Website with Rest of Business
Last, but not least, you should consider integration for your webstore. This is relevant for eCommerce sellers who sell on other channels (i.e., marketplaces or brick and mortar) or use other software (i.e, ERP or Accounting) to run their business.
Integration allows you to link those systems together to improve your business processes. This includes syncing inventory levels across sales channels and automatic order fulfillment, among other benefits.
Online businesses can use platforms like nChannel’s channel management platform to achieve integration.
What to Do Next
Undertaking a new eCommerce webstore is not an easy feat. By knowing the basics, you can build a solid foundation for a successful business.
You can always learn new ways to improve your eCommerce business. To stay informed about the latest tips and advice about managing eCommerce businesses, subscribe to Multichannel Insights!