What is an e-commerce business?
E-commerce is the process of electronically buying and selling products online. The need for retailers to provide online services has grown and created a market opportunity for sellers. Therefore, now is a great time to begin your e-commerce journey. Importantly, starting your own business of any kind can be a big step up from your current workload. However, starting your own business doesn’t have to be long hours with no reward. For instance, many businesses start from humble beginnings. Furthermore, these start as a side project that grows into a full-time job.
In this article, we will discuss some key steps to consider in the initial phases of setting up an e-commerce business. These steps will track the progress from the initial idea to sourcing the right products and running the online store. Moreover, the side hustle business can be tracked to gain an insight into entrepreneurship and starting a business. However, creating your own e-commerce store is only one of the ways to make money online. Therefore, I have outlined below 3 key steps for any potential business owner considering starting their own e-commerce business.
1. Find that great idea
First, you need to find a great overarching idea that will propel your business into the market. This is one of the most challenging parts of starting a business. Many entrepreneurs get paralysis by analysis with all the information available to them on the business products or service idea. Therefore more in-depth market research will provide the answers to some initial questions around the demand and scalability of the business.
Secondly, consider your skillset and the niche area that you have chosen to specialise in. This could be from previous work experience or a hobby that has enhanced a certain skill set. The inside knowledge of a particular niche will give you an edge over your competitors. Once you have identified the niche that you would like you can then narrow down the product or service that you would like to provide. The best way to do this is to research what is already in the market space. Search on websites such as Amazon and Aliexpress to find out products that are trending to see the popular producing being brought and sold. However, you should not rely solely on what is currently popular as it may not be in demand in the future take fidget spinners as an example.
2. Setting up an online e-commerce store
The process of narrowing down your idea to a single choice may take time to develop and decide. For me, this was a process over a number of weeks. The product chosen will require you to invest time, money and effort to create an e-commerce store. Now that you have chosen your product you can move on to getting a store up and running. Partnering with key brands in your niche can be a great strategy to increase brand awareness. Furthermore, affiliate marketing can offer a boost to organic traffic and grow the online store market exposure. Creating your own blog in the same niche can help promote your brand and identify any trends or gaps within the market. There are many different options to choose from and I have outlined two of the main websites that can assist with setting up an online store.
Shopify
Shopify is a Canadian company that provides an e-commerce platform for online shops and point of sale providers. Operating a Saas model Shopify provides subscription-based software to users who are wanting to set up their own store and sell products via an online store. With a 14 day trial, you are provided with the opportunity to set up your very own e-commerce store and begin to sell a product. From there cost of the basic plan starts at $29 USD per month. The basic package allows vendors to sell unlimited products with 2 staff members with admin rights. Therefore, when choosing your e-commerce platform it pays to shop around to get the service that is right for your business.
I have outlined the pros and cons of setting up an e-commerce store with Shopify below:
Pros
- Cloud based service
- Low start up costs
- 14 day free trial
- Easy to use interface on platform
- 24/7 customer support
- Automatic discount trigger (no discount codes required)
- Integration of Sales channels (Amazon, Facebook)
- Foundation for sucessful e-commerce marketing strategy
Cons
- Ongoing monthly subscription fee
- Low emphasis placed on content marketing
- More difficult to grow brand
- Incremental prices for any additional services
- Harder to customise store
- Hard to swap to different e-commerce providers
BigCommerce
Firstly, Bigcommerce is a direct competitor with Shopify that offers premium hosted e-commerce Saas services to retailers. Secondly, founded in 2009, the Bigcommerce platform enables store creation, Search Engine Optimisation (SEO), hosting and marketing services. Thirdly, the greatest advantage is there are no platform fees on top of their subscription plans. Moreover, Bigcommerce can be trialled with the first month free and ongoing from $29.95 per month on a basic plan. In conclusion, the platform offers a low cost, agile e-commerce experience.
I have summarised the key features of the Bigcommerce platform below:
Pros
- No platform fees on top of subscription plan
- Built in sales tools
- Advanced SEO features to boost organic traffic
- Multi-channel integration to easily sell between platforms
Cons
- Hard to set up an e-commerce store
- Revenue led billing model
- Not the market leader in e-commerce platforms
- Not ideal for small scale selling due to ease of use
3. Testing your e-commerce product
Next, have you found that great product or idea but are unsure if it will be successful in the future?
This is a problem that people can run into if they are hesitant on spending a large outlay given the risk that it could potentially fail. Therefore, to test the idea business owners can release a Minimum Viable Product (MVP). An MVP is a version that has just enough of the minimum features needed. For instance, the initial basic product allows early customers to test the product and provide feedback for future growth. Moreover, this avoids spending large amounts of time on a product that was never going to be successful.
The alternative to releasing an MVP is to test the market by starting a dropshipping business. Most importantly, this low-cost alternative sells the products on the supply chain of an established business. Therefore, you act as an intermediary to pair a buyer with a seller of a product. You will earn a commission paid once the sale has been made. You can review the pros and cons of dropshipping to test the market for your new product line.
E-commerce Summary
In summary, e-commerce can be a great business model to scale and grow your business. Choosing the right niche will allow you to narrow the focus of the e-commerce store. Shopify can streamline the set-up of the e-commerce business. However, the ongoing costs and low blogging focus may impact your decision. Bigcommerce offers no additional platform fees and is great for established stores seek multi-app integration. However, smaller stores may want to consider the ease of use when selling a limited amount of products. Product testing including a trial of a minimal variable product and dropshipping can help identify a market. Furthermore testing different products can provide data to determine the product you wish to sell. Now you can promote and scale products on your own e-commerce store. To learn more on how to drive traffic to your website have a read of the following SEO tips.
