Ecommerce 101

Ecommerce: put simply ecommerce is selling stuff on-line. This article looks at three main options used for selling online and some of the pros and cons of each one.

1. Building a store using an ecommerce platform. An ecommerce platform is software that brings together the various elements of retail and unifies them behind an online storefront.

Pros: Platforms such as Magento, Demandware or Shopify have customisable front-ends that allow you to design a unique looking ecommerce site that reflects your brand and vision, while having ecommerce specific functionality in the backend. They are constantly developing and evolving in an effort to stay ahead of the competition and create better online experiences. These specialist ecommerce platforms offer functions that will help you build your business, from data capture and SEO for marketing purposes, to integrated payment systems for easy checkout and billing. They are to a degree “out of the box” solutions that ecommerce developers will be experienced in working with. Most platforms are now mobile-ready by default, and come with a huge range of add-ons & plugins to extend the platform’s capabilities . Different pricing models range from free, to subscription, to a percentage of turnover or profit, and everything in between, which means there is something for every size of business and every budget.

Cons: There are literally hundreds to choose from, each with different features, benefits and limitations. Also, “out of the box” rarely works completely “out of the box” and will need customisation and configuration to work properly. Once you’ve built your business on one platform it can be difficult and expensive to migrate to a new ecommerce platform. Once you’ve built your site on an ecommerce platform, even one with lots of integrated marketing features, it’s still up to you to develop the right strategy to attract visitors to your site.

2. Marketplaces: Marketplaces are an online version of…well, of a marketplace. That is, they gather together items from multiple sellers in one marketplace. The best known of these are EBay, Etsy and Amazon, newer entrants to the market include NotOnTheHighStreet or Depop.

Pros: Marketplaces are brilliant for start-ups with a few products and smaller budgets as they are less risky financially than building an online store. Marketplaces have more traffic precisely because of the range of products offered, which will encourage more traffic viewing your product when showcased in an online marketplace. Marketplaces will invest heavily into optimising the user experience, such as ensuring the site works well on mobile. This means you don’t have to – this would be a different story if you were developing your own website.

Cons: Margins from sales are lower as the marketplace takes a cut, which will impact your profits. Volume businesses selling through marketplaces can be very profitable, whereas small more unique products may struggle to make a real impact. You may also be up against larger retailers in the same marketplace than can afford to offer similar products at a lower price, reducing your conversion rates. Marketplaces don’t offer the same levels of customisation that your own online store would have. If choosing to sell your products through a marketplace you need to consider how your products will be presented in your chosen marketplace.

3. Bespoke build: Developing a custom-built website that you have designed and built from scratch.

Pros: Control over everything. From the creative look and feel to how you’ll gather data for marketing; building your own bespoke website from scratch means you are in total control of everything. This might be suitable if you’ve got specific niche features that are unique to your product or very specific business requirement that existing platforms can’t fulfil. It’s also worth noting that when the build is finished, you own the code so there is no costly tie in.

Cons: Control over everything. With so many different aspects to a successful ecommerce business it isn’t necessarily the right choice to do it all yourself. Additionally, if you don’t have an existing following it’s going to be much harder for customers to find you amongst the millions of other online shopping outlets.  When large retailers such as ASOS launched, there wasn’t the variety of ecommerce platforms available that there are now, so building your own from scratch was a sensible option. Now there are so many to choose from that have been specifically developed for selling online, it’s a risky strategy to build something new from scratch, which could be expensive to maintain and leave you heavily dependent on the development team that builds it.

Whatever path you choose for your online sales activity it’s essential that you have in place a marketing strategy to drive visitors to your site, ensure high conversion rates, drive repeat visits and encourage your customers to share your store with others. It’s a mistake to think the starting point is choosing which platform to sell through.

The starting point should be your customer and how to engage and attract them; what processes are involved in delivering the product to the customer and finally which platform can bring these aspects together.

KO Consulting can help you reach your target market. Get in touch to find out how.


Kathleen O'Connor

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