Ecommerce Guide – Introduction & How to Start an Ecommerce Business?

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Milica Vujasin

Content Writer

⏱ Reading Time: 17 minutes

Ecommerce is a daily part of our lives. We order clothes, electronics, and food online. We use credit cards almost every day. Online shopping or eCommerce is fully integrated into our lives and it is hard to imagine our life without it. 

🚀Read Customer Experience Guide: How to Put your Customers First? 🚀

Let’s walk down the e-commerce memory lane to get a full understanding of online shopping.  Learn how to improve your eCommerce business with the help of the eCommerce guide! 

What Is Ecommerce?

Ecommerce, also known as electronic, online or internet commerce is a business model that refers to buying and selling the products or services using the Internet. Simply, it is a way of doing business over the internet without having to visit the physical store.

The most popular example of eCommerce is online shopping,  but there are also other types of activities such as payment gateways, online auctions, online ticketing, and internet banking.

Also, when thinking about the past of eCommerce, it has definitely evolved through the years. Examples are seen in improved payment options, faster shipping, more developed UIs, automatic order processing, and more. These changes had a significant impact on customer understanding of the usefulness of eCommerce.

 

History of Ecommerce

The history of eCommerce goes back to the 20th century. In 1979 when Michael Aldrich connected his television to a computer using his telephone line. Although it was unlike eCommerce as we know it today, his concept triggered the idea of shopping without visiting a physical store.

But, have you ever wondered how did the first-ever online sale start? On August 11, 1994, a man sold a CD from Sting to his friend through his website NetMarket. That sale was the first example of a consumer buying a product from an online business through the World Wide Web—or “eCommerce” as we know it today.

First ever online sale

Picture 1. First-ever online sale

So since 1994, eCommerce has only expanded more in order to make products easier to discover and purchase through online retailers and marketplaces.  Now, small businesses, large corporations or independent freelancers can all benefit from eCommerce. It enables them to sell their goods, products, and services at a scale that was impossible before. 

Also, the history of eCommerce wouldn’t be the same without two big companies – Amazon and eBay. They were among the first Internet companies to allow electronic transactions. 

Right now, eCommerce is the fastest-growing retail market projected to hit $4.135 trillion in sales in 2020. 

5 Benefits of Ecommerce

It is a well-known reason why e-commerce became so important and had tremendous growth for the past decade.  With internet growth, businesses are learning how to take advantage of it. Here is the list of the eCommerce benefits:

 

Global market

With the expansion of digital, the companies are no longer focused only on local physical stores. Their reach no longer depends on the number of brick and mortar locations they open. Ecommerce makes it easier for companies to expand their reach to more customers using the eCommerce websites. From the local store to the global market is one of the most crucial benefits of eCommerce.

 24/7/365 availability

It is great when you can sell your products any time to anyone in the world. This is a unique advantage for businesses, as for their sales spot is open 24/7. Moreover, digitally empowered customers can reach out whenever they want to make a purchase.  Without working hours, an eCommerce business can serve its customers 24/7/365.

Targeting customers

Accessing customer data such as habits, interests, gender, status, and other personal information enables companies to stay agile and in shape with marketing activities. Moreover, these types of information help companies provide better customer service.

Just having the possibility to address hundreds or thousands of your customers by their name is something.

Working from anywhere

With eCommerce, people can work remotely and don’t have to be in the office from 9 to 5. Having that in mind, all you need is a laptop, excellent internet service and phone to manage your business from anywhere in the world. Also, don’t forget to communicate with your customers online with live chat to boost customer experience and support.

Also, when talking about remote work as an increasingly popular practice, you may want to read the article we wrote about it: Remote Work Tips & Tricks.

Reduced costs

Online business benefits significantly from lower running costs. There is no need for physical storefront or salesperson or even storage (depending on your industry). As a business, you can save on operational expenses so that you can offer better deals and discounts to customers.

What Is Ecommerce Customer Service?

At its core, customer service is the support companies offering their customers before, during and after the products or services have been bought. Limit it to eCommerce customer service, which is best described as offering online store help to customers.

In a fiercely competitive world, in order to distinguish themselves from the rest of the market, eCommerce company owners invest in customer experience and customer service strategy. Customer service strategies for eCommerce often require omnichannel customer support, live chat, and purchasing experience that is personalized. These companies’ ultimate objective is to provide eCommerce customer service that will provide them with loyal customers, greater conversion rates and greater customer lifetime value.

Read more about eCommerce customer service and its best practices in our other article: Ecommerce Customer Service: 5 Tips to Stand Out of The Crowd.

What Is Ecommerce Marketing?

Ecommerce marketing promotes your shop through a multitude of marketing channels to prospective customers. It assists you to drive traffic to your online store, which is why we can also describe it as a larger Internet marketing strategy.

And that marketing strategy can assist create awareness of the brand, drive customer loyalty, and eventually boost online revenues. So if you want to drive traffic to your online store, implementing ecommerce marketing strategies is crucial.

If you want to read more about those strategies, check our other article about it: 8 Ecommerce Marketing Strategies – Stand out from the Competition.

What Is Ecommerce Live Chat?

To keep up with the constant changes that are happening all over the world, and to stand out from the crowd, companies are considering live chat more and more. Not only it can help to improve customer experience, but also increase sales and boost your brands’ credibility.

One of the eCommerce challenges is that your visitors are unable to connect with someone who can answer their questions at the same moment. And many researches proved that customer mostly return to those companies who have implemented live chat into their website. That’s why live chat is crucial for eCommerce.

If you want to read more about why eCommerce live chat Is important for your business, check our other article about it: eCommerce Live Chat: Chat more To Earn More.

5 Ecommerce Platforms

An ecommerce platform is a piece of software that allows businesses to create online stores. It also gives you the tools to create and manage your site. Most of the ecommerce platforms provide a one shop stop for business owners to manage an online store with ease. 

When choosing an ecommerce platform for your business, you should consider a few things. Such as features, price, the technology used, and others. Here are a few great examples: 

5 best ecommerce platforms

Picture 2. Ecommerce platforms

BigCommerce – this leading ecommerce platform offers features such as a shipping option, site builder, reporting, and more. It also enables retailers to sell on other sites and platforms, including Amazon, eBay, Facebook, Google Shopping and Square. Also, it offers a bunch of good things such as great support, customer loyalty, mobile integration, user-friendliness, and many more things.

Drupal Commerce – an open-source ecommerce framework that allows users to build online applications and stores on Drupal. It is exceptionally adaptable while it offers a lot of modules that allow users to improve and increase its functionalities.

If you want to read more about Drupal, check our blog post: Why users love Drupal.

Also, Paldesk – Live Chat & Help Desk for Drupal allows you to add live chat to your Drupal website quickly and easily. Help your visitors in real-time and convert them into customers! Increase your conversion rates, improve your loyalty and provide brighter interactions directly with your visitors when they’re ready to do so.

Drupal ecommerce

Picture 3. Paldesk and Drupal integration

Magento – this advanced eCommerce platform offers powerful features for your online business. It gives merchants the ability to customize their eCommerce store, and you have complete freedom over the look and feel, and functionalities of your site. Plus, it is free and it is built on open source technology. Also, it offers search engine optimization, powerful marketing, and catalog-management tools.

Set up Magento Live Chat with Paldesk.

Shopify – an eCommerce platform with features that let you sell online, on social media, and in-person. It enables you to build and customizes website through an easy interface as it also enables you to start and grow a business. Plus, they have social selling functionalities for those who are active on Facebook or Pinterest.

Read Ecommerce Platforms to Build Your Business: 8 Popular in 2019.

WooCommerce – WooCommerce is an open-source eCommerce platform for WordPress users. Some of the features include shipping options, reporting, and mobile-friendly functionalities. Even though it is built for WordPress, it also connects with other platforms. 

Also, since WordPress is one of the most used platforms on the Internet, you will want to read our other blog post about it: 10 Best WordPress Plugins for Excellent User Experience.

Planning an E-Commerce Business

When thinking about your business idea, first and foremost, you need to figure out what you do best. The questions you could ask yourself are:

What am I selling?

Who do I want to sell it to?

How am I sourcing my product?

Once you have selected a product to sell, make your brand the most attractive option for your target audience. To be sure that the existing targets are reachable and clear, each one should be set focusing on SMART goals. They are easy to use by anyone, anywhere, without the need for specialist tools or training.

Make your goal SMART, following these criteria:

  • Specific (simple, sensible, significant)
  • Measurable (meaningful, motivating)
  • Achievable (agreed, attainable)
  • Relevant (reasonable, realistic and resourced, results-based)
  • Time-bound (time-based, time-limited, time/cost limited, timely, time-sensitive)
Ecommerce guide smart goals

Picture 4. SMART goals

However, planning an e-commerce business, without constructing a business plan can be tempting. Therefore, putting your ideas down on paper can help you set clear goals for your business from the outset. What you should hope to get out of a business plan is market and business knowledge.

In other words, a better sense of what you know and more importantly, what you don’t know. You should also get a better overview of the resources you’ll need to make your online business successful, such as partners, money, and employees. After finishing your business plan, you should have a better sense of the viability of the opportunity.

How to Start an Ecommerce Business?

If you’re starting an e-commerce business from scratch, it’s time to start ticking off things from your checklist, so here it is.

Step 1: Choose your e-commerce niche

Choosing a niche is the most important step in starting an online business. It’s suggested to start this process by identifying successful companies already working in this sphere. Thus, nor the most competitive or the least competitive market area is a good choice.

„If having issues with this part, narrow it down and make your niche more specific.“

When narrowing it to micro-niche marketing, you can rank your content for related keywords more easily. The benefit is also having a lot of “shoulder” niches with whom business owners can work together in order to grow the customer base.

Step 2: Research business models

The goal is to find a type of commercial model that works best for your business. A business model refers to a plan for successful business growth, and how it relates to current products or services in the industry. 

Here are the 4 main types of e-commerce models. They describe almost every transaction that takes place between consumers and online businesses.

Business to Business (B2B): This model is the one where the exchange of goods or services takes place between companies instead of individuals. It is usually a situation whereby one company provides goods or services online with other companies as its target audience.

Business to Consumer (B2C): This model refers to the distribution of goods and services from business to individual consumers. Examples of this model are Amazon and PayPal.

Consumer to Business (C2B): Opposite from the B2C model, this one is when a consumer sells their products or services to a business or organization. Examples can be programmers, social media managers, content creators, and other services providers working online.

Consumer to Consumer (C2C): When a consumer sells a product or service to another consumer, usually through a third-party website. Example from Magneto: „Cryptocurrency exchanges that offer over-the-counter trades to users. Under such circumstances, the exchange charges a fee for the transaction while it allows the users to transact cryptocurrencies with one another.“

Step 3: Buyer personas and product selection

Sometimes, before developing the idea of your business, is even better to think about the buyer personas of your brand. Who are you? Who are your customers? What does your business represent?

„The persona of your brand has to match the expectations of your customers and the products you choose to carry.“

You need to project a consistent brand image because your goal is to gain a lot of targeted traffic in your business. To expect people to buy your product, you have to know who you’re selling to. In this case, surveys are a quality source. Through surveys, you’ll get a better insight into the factors that keep your customers buying again and again. That way you can find people who are genuinely interested in your brand.

Still haven’t created your buyer personas? Do it with the help of our guide

Ecommerce guide survey

Picture 5. Use surveys to see why customers use your products

OnceStep 4: Establish your brand and business

Once you’ve identified the image you want to project and target group for your e-commerce business, it’s time to start with product ideas. Whatever you go for, remember that often less is more.

Before you invest in the product, evaluate it carefullyAlmost anything on your website that harms visitor behavior can be A/B tested

Also, start thinking about your product price and what customer problems they solve. That will give you a better idea of how to set your pricing model correctly.  If you set a price too low, you could fail with your return of investment. On the other hand, if your price is too high, a lot of your customers won’t likely be able to afford it.

Step 5: Create your online store

When choosing an e-commerce store builder, consider price, features, support, ease of use and performance. In this phase, you will need to start thinking about the design, registration of your domain name and any redirect URLs that might be relevant. However, it doesn’t mean you will have to hire a development company. It would be enough to use a theme. In that case, depending on your business brand, you might only need to pay a small fee to get a good template.

Once you have created your online store start thinking about the different channels where your audience is most present. Create an omnichannel customer experience strategy to establish better brand visibility and better shopping experience! 

Step 6: Attract customers to your e-commerce store

The best e-commerce sites invest a lot in online marketing. If you don’t have funds, there are many other ways to increase publicity. This is individual, though, and depends on whether you will use sponsored content, social media, pay-per-click ads, or combination of them all. Once you decide, keep monitoring what campaigns are driving traffic to your store. However, consider hiring help if marketing your site seems overwhelming.

Read: 8 Ecommerce Marketing Strategies – Stand out from the Competition

Ecommerce guide attracting customers

Picture 6. To attract customer is to lead them to buy your products

Step 7: Marketing your products online

Track the flow of the traffic on your site. You can use analytics tools to help you monitor and optimize every step of the sales process.

If you notice sales curve is not increasing, although you’re driving traffic to your store, take a close look at your product listings and carefully improve each page. There are thousands of marketing metrics for tracking your e-commerce business success, but only a few of them, directly represent the state of your business and can be turned into actionable insights that help you grow.

These are the eight most important metrics we believe every e-commerce store owner should track:

Top 5 Ecommerce Tools

It is very important to find the tools that will help you manage your business activities. So here are a few tools to help you reach your full potential:

Top 5 ecommerce tools

Asana

Asana is one of the most popular management tools that allow you to create different tasks for each team member, create plans, mark projects and task as completed, and other possibilities. It is flexible and very useful, especially when you have deadlines.

Search spring

If you want to collect better search data, optimize auto-complete, drive search conversions or provide relevant search results, use Search Spring. One of the largest ecommerce brands that used Search Spring is Stanley Black & Decker. Mostly for their advanced website search and category navigation.

SEMRush

SEMRush is a tool that will let you see your page performance and you will have an insight into competitor site where you can then compare sites. This tool tracks more than 106 million keywords and tracking more than 87 million domains. Also, it offers solutions for social media, PPC, content, SEO and competitive research.

Squarespace 

A simple website builder for all types of businesses that offers several options. It is ideal for creating professional websites as it offers the high quality of the templates. One of the best thing about Squarespace websites are the cool features and the fact that is is mobile friendly.

VWO – Visual Website Optimizer

VWO is A/B testing tool that offers a bunch of features that go well beyond just analytics.  It is a great tool for marketing professionals as it allows them to create a different version of their websites. Also, it integrates well with most major e-commerce platforms.

If you want to discover more tools so you could easier decide which one suits your business the best, check our blog post: 20+ Best Ecommerce Tools for Emerging Startups.

Top 3 Ecommerce Trends in 2019

Personalization

Ecommerce personalization has become a huge trend among businesses over the past couple of years, but especially in 2019. Since customers expectation of personalization increases, personalization should and will become an eCommerce standard. 

So, the key to customer satisfaction is personalizing the online shopping experience. By offering a personalized customer experience, you will both deliver a great shopping experience and connect with your customers more.

Rise of Voice Commerce

Voice commerce is one of the newest trends in the eCommerce world. The term is used to describe any transaction with a business that happens when using a voice device. This trend got its popularity way back in 2014 when Amazon launched its smart speaker called Echo. And now it’s on the rise. The research said that by 2020, voice commerce will generate a total of $40 billion in sales in the U.S. alone.

Ecommerce trend amazon echo

Picture 8. Smart speaker Echo

Mobile Shopping is Growing

Mobile shopping is notably growing. Researches proved that since 2016, sales made via mobile devices increased by 15%. So now would be the best time to optimize and improve your site for mobile shoppers. 

By improving the ecommerce experience for mobile customers you will open a whole new door with a lot of opportunities. Especially because trust in online shopping is increasing, and consumers feel more comfortable shopping on mobile devices than before.

Also, statistics from Statista said that by the end of 2021, 73% of ecommerce sales will take place on a mobile device. So you can see that mobile ecommerce is highly important to retailers who decide to provide online stores.

Mobile eCommerce data growth

Picture 9. Mobile eCommerce statistics

These are just the 3 main trends but there is a lot more. We wrote about them in our other article that you can read over here

E-commerce Wrap-Up

After all this information, you are probably asking yourself: “Should I start an ecommerce business?” Well, I guess the answer is clear. Most definitely!

It does take careful planning to get your e-commerce business from zero phases to the launch phase, but once you start selling, you can build a successful e-commerce business. Moreover, you can follow the steps pointed out here to cement your own understanding of the market and your business. Do not hesitate to take advantage of lucrative opportunities. 

To summarize, we hope this guide will help you to develop your own ecommerce business as much as to understand the concept of ecommerce. 

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Ecommerce Guide – Introduction & How to Start an Ecommerce Business? was last modified: September 19th, 2019 by Nikolina Maškarić
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