And nowhere has that acceleration been more keenly felt than in the way we purchase goods and services. Than in ecommerce.
While many brands relying on traditional wholesale and retail channels face a financial reckoning, those more focused on ecommerce and direct-to-consumer sales have experienced a bonanza (e.g. online retail transactions in home and leisure categories rising 200 percent year on year).
What about you? Are you also profiting from new online sales opportunities?
It’s easier than you might think.
Ecommerce – The New Normal
With many consumers and businesses now buying goods they would never have considered buying online before, and others using ecommerce through a lack of choice, it’s likely that these new behaviors will persist.
Even before the ’new normal’, global ecommerce, valued at $3.538 trillion in 2019, was predicted to grow to what now appears a conservative $6.54 trillion by 2023.
For most businesses now, the question isn’t whether to invest in ecommerce, the question is how.
We’ll run through the most important considerations when it comes to selecting the right ecommerce platform for you.
When choosing an ecommerce platform for your business you’ll want to get it right, first time. With the cost and commitment required to succeed, acting in haste and going down the wrong path is arguably even more dangerous than not acting at all.
We’re going to outline the advantages and disadvantages of the three main options: hosted, self-hosted and custom built ecommerce platforms.
Whichever path you end up taking, as a minimum you’ll want a platform that allows you to:
A hosted ecommerce platform – also referred to as Software as a Service (SaaS) – provides a suite of tools that bolt together for quick and simple deployment. Drag and drop store-builder modules including themes, shopping baskets and online payment integrations, plus apps integrate useful third party products such as MailChimp, Zendesk and Visual Website Optimizer to make the hosted ecommerce route a quick and low cost introduction to the world of ecommerce.
Rapid results: The technology already exists ‘out of the box’. Set up is simply a case of choosing the blend of modules to best suit your store, configuring your store, populating your site and off you go.
Easy to manage: Because you’re assembling your ecommerce site from a library of user-friendly modules, you can be confident that the tech is not only tried and tested, but also simple to implement.
Fixed monthly fees: Because you only pay for the modules you want, you’re never paying for technology that you’re not using. Add additional services as your online business grows.
Ecommerce support: With technical support just a chatbot away, if you do have any technical issues you’ll never be far from an answer.
Lack of flexibility: Speed of setup and ease of management can work against you if you need to customise your platform. The ‘one size fits many’ principle of the platform hinders functionality should you want to do anything that’s out of the usual.
Cost creep: While competitive at the outset, as your business scales, so too do costs. The more features you use and the more traffic you attract, the more your monthly fees will ramp up.
Lock-in: As your online business grows you may find that spiraling costs and a lack of customisation mean you start to consider alternative platform options. Beware the time and expense of shifting platforms.
SEO: Search rankings matter. And in a competitive sector like ecommerce they REALLY matter. With 51% of shoppers using Google to research a purchase and the top 3 organic rankings winning two thirds of click throughs it’s vital that you’re visible. Unfortunately hosted ecommerce platforms aren’t the best for SEO as they offer limited flexibility over your SEO variables. For example you may struggle with simple issues such as access to FTP, robots.txt being blocked, problems with browser caching and product page indexing.
Checkout + Payment: With almost half of ecommerce abandonments taking place at the payment stage anything you can do to make the process as easy as possible can yield significant benefits. Without the option to add more flexible checkout and payments plugins or develop your own, you may well find yourself locked into high fees, inflexible payment processing requirements, and UX. Critical aspects of your customer journey that you have little or no control over.
Marketing integration: As with checkout and payments the closed-source nature of hosted ecommerce platforms limits your marketing options. When you want to take a nuanced, integrated approach to your marketing you’ll want maximum flexibility and maximum control over important marketing considerations including UX, design, content, email, social media and campaigns. Without the ability to apply the changes you need you’ll always find yourself battling with the limitations of packaged products.
A popular route taken by businesses who prefer to have a greater degree of control over their technology, a self-hosted ecommerce platform puts you in charge of store build, hosting and data storage.
The main cost and complication here is in setting up a cloud based server (though you can host locally) with the open source software itself often free. Magento and PrestaShop for example come equipped with many of the same features as paid for eCommerce platforms, with no initial cost.
You’ll certainly require a degree of expertise to set up and run a self-hosted platform. If you lack the inhouse capabilities then an expert ecommerce partner will prove an invaluable member of your team.
Greater control: Running your own server and your software gives you far more control and flexibility over relying on a hosted platform and having to work within its framework.
The features you want, not the features you’re given: Choose the plug-ins and extensions right for your business – not just because they’re the only ones available through your host.
Scale and scope: The ability to host your ecommerce means you can futureproof additional capacity and performance requirements. Instead of relying on your hosting provider, self-hosting puts you in charge of your technology so that it can flex or contract to meet any future needs.
Independence: Using lower cost self-hosted platforms avoids the risk of hosted ‘lock in’ making it quicker and easier to move to a different provider should you wish.
Technical knowhow: While hosted platforms offer a relatively quick and easy way to get up and running, you will need to go to the time and trouble of identifying a hosting provider, choosing the right software platform and setting it up. That said, there’s no shortage of ecommerce partners skilled in specifying and setting the platform best suited to your business.
Ongoing support: Part of the attraction of a hosted ecommerce platform is the ongoing technical support. If you’ve established a good relationship with a provider during self-host setup then you can expect that support to continue. If you choose to go it alone then of course you will be reliant on your inhouse capabilities to see you through any day to day issues.
Mounting costs: As with hosted ecommerce, as functionality and traffic scales over time then so do costs.
With the range of hosted and self-hosted options on the market you’ll really need some very good reasons to justify a bespoke build. That said, your business or industry may be unique, your service offerings specific or you may need a super secure system – in which case a custom build might well be your best option.
Product and Shipping Options: The more flexible you want to be in customising products, for example, a sophisticated selection of sizes, colours and designs on a range of clothing or engineering products, your sophisticated custom platform will allow you to meet these variables. And the same applies to shipping options – couriers, locations, product combinations or shipping types. Multiple suppliers each with their own shipping preferences also present potential complications that your software will have the flexibility to meet.
Make your own rules: You may have complex or unique ways in which you use discount codes or coupons. A custom platform allows you to make your own rules and not have to follow those set by an out-of-the-box host.
System integration: You will no doubt need to integrate your ecommerce with back-end systems at some stage – for example accounts, CRM, ERP. The more complex your requirements, the more likely it is that you’ll need some form of custom integration through a custom platform.
Reporting: You and your customers may need custom reports beyond the scope of an off-the-shelf modular system.
Added security: You have a legal responsibility to protect your customers’ data. Are you prepared to trust your ecommerce host? Or would it be wiser to entrust the security of that data with an expert custom online sotre provider and security experts? Security that’s important for your compliance and attractive to any customers keeping a close eye on the safety of their private information.
Upfront Cost: Compared to an out-of-the-box ecommerce platform, a custom solution may appear beyond your budget. But if you look at a pure ‘money in, money out’ equation, you’ll still see returns on a slower burn.
Reinventing the wheel: Your business model – how different is it to others in your industry already enjoying success online? Do they use custom builds or are there sufficient tools within hosted or self-hosted products that already handle those needs?
Walk, Run, Fly: Would a custom platform be ‘overkill’ as the first step on your ecommerce journey? Even if you did start with an out-of-the-box or partially bespoke self-hosted system might that be a wise starting point? A proof of concept from which you can grow your ecommerce expertise and look to add or move to a custom setup in the future?
Always start with your objectives.
What are you looking to achieve here? Why? Are you looking to simply boost revenue? Or do you want to create or enter a new market? Do you even need ecommerce? And what about your long-term 5 year plan? Is this project driving it, a key part of it, or just supporting it?
This is a serious commitment and serious commitments deserve serious consideration – not just technologically but strategically too.
And what about capacity? Not just business growth capacity, your ability to get more units out of the door, but your inhouse technical capacity too – your ability to handle the CRM, marketing automation, product listings, databases and to manage your e-marketing with things like coupons, discounts, special offers, banners, pop ups and the rest.
Once you’ve carefully considered your objectives and capacity then be sure to talk with an ecommerce expert to explore the options and to examine the paths best able to deliver the results that you want.
Expert Ecommerce Guidance
For a clear, concise and informed exploration of your ambitions and the most rewarding ecommerce options, talk to us today.
We’ll guide you through the complexities so you can be absolutely sure you’re making the right (and most profitable) ecommerce decisions.
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