What is an e-commerce website?
E-commerce & Beginner's guides
If you’re interested in shopping online, then you definitely know a thing or two about the core subject of this article. E-commerce stands for electronic commerce, which essentially means setting up a store electronically and selling things by way of the internet. Shopping online is convenient, and the more tech-savvy people become, the more they’ve begun to rely on online shopping. This business is lucrative, yes, but how exactly do you get started?
If you’re curious about having your own e-commerce site, look no further. We have all of the important information below!
What exactly is e-commerce?
As mentioned, e-commerce is a type of business or store that revolves around transactions of information that take place over the internet. This is not limited to retail stores but is wide-ranging from auctions, business exchanges, as well as goods and service trading sites between business, individuals, corporations or otherwise. Bear in mind that when dealing with e-commerce transactions, there is no time or distance barrier.
Electronic transactions have been around for quite some time in the form of Electronic Data Interchanges or EDIs. Now an extremely lucrative business venture, consumers turn to online shopping for a variety of reasons, including that it saves ample time, money and energy. Comparing prices online is made simple, as pricing options are all at the click of a button.
For business owners like yourself, there are two distinct types of e-commerce sites and these are either running an e-commerce site that targets consumers and individuals or running a b2b site (business to business site) that sells goods and services to established entrepreneurs in a specific marketplace.
The basics of running an e-commerce website
Shopping cart software is one of the basic tools for starting an e-commerce website. This operating system allows customers to purchase goods and/or services from your business, placing them into a virtual shopping basket. There are varying options when it comes to shopping cart software, and they can be completely customizable to suit the needs of your business.
Another point of consideration before starting your e-commerce site is whether you plan on starting completely from scratch or if you want to partner with an existing site or online platform. Platforms such as Shopify, Etsy, BigCartel and so on already come with the infrastructure to begin a small online business.
In most cases, it is best to start an online business in a niche market, especially something that consumers have difficulty finding in stores. However, regardless of the marketplace, an important aspect to think about before starting the business itself is shipping. Shipping certain products can be expensive, especially if they are heavy or travelling far-reaching distances. Look into this and weigh the costs!
Following this, you’ll need to figure out how to accept online payment, and this will involve getting an online merchant account and working with an online payment gateway. If you’re working with an already established e-commerce site like some of the ones we've already mentioned, a payment system is likely already in place. In the case of smaller sites, PayPal is a popular option for the integration of online payments.
Lastly, you will need a clever and concise marketing strategy for increased consumer reach and gaining the visibility you’re seeking. If you’re new to the business world, this might take some time, energy and money. If you’re looking for some concrete ways to gain online visibility, check out our article: How to increase your website's visibility.
There are many pros and a few cons to operating an e-commerce site, so we’re going to go over some of the main ones to give you a better idea of what to think about
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Pros of running an e-commerce site
E-commerce is a rewarding venture, but like with any successful business, making money overnight is next to impossible. Instead, dedication, perseverance and a serious plan of action are necessary factors. Here are the pros of starting your very one e-commerce site:
- Open up to a larger customer base, as online platforms allow you to access national as well as international markets;
- Lack of distance limitations regarding your customer reach;
- National and international reach will work to boost sales as well as profitability;
- E-commerce stores are open around the clock, meaning sales are able to be made at all hours of the day;
- Online stores experience a reduction of costs, as owning an online-only business means that you won’t have to pay rent for a physical location as well as excessive manpower to keep things running;
- Readily scalable, as an e-commerce business can start out small and grow organically or expand as needed.
Cons to e-commerce
Like all business ventures, e-commerce has some drawbacks as well. The cons to e-commerce are as follows:
- There is a lack of customer interaction when it comes to online businesses. This is something to bear in mind when thinking about creating personal relationships with your customers.
- Competition is another serious drawback of e-commerce, with online options ranging much wider. This also means working twice as hard to gain traction as a business.
- Technical issues are obviously inherent when it comes to running an online business. Of course, if something happens to go wrong online, including issues with the credit card processor, you could easily lose money. In the worst case scenario, you could lose customers as well.