e-Commerce is any form of business transaction conducted online. An example of eCommerce is online shopping, which is buying and selling of goods online on any device.
However, e-Commerce can also entail other types of activities, such as online auctions, payment gateways, online ticketing, and internet banking.
e-Commerce is the fastest-growing retail market projected to hit $4.135 trillion in sales in 2020.e Commerce is an expanding market with the influence of smartphones and millennial's’ comfort with shopping online. In 2018, the mobile e-Commerce sector enjoyed a 39.1% increase in sales compared to the previous year.
eCommerce Business Models:
Business to business (B2B):
B2B is when businesses sell to other businesses. This is typical of stationery stores who sell office equipment in bulk to businesses. Normally B2B companies provide a discounted rate per unit if customers buy in bulk which it is great motivation for offices to avail of.
Business to consumer (B2C):
B2C is the most commonly thought of business model where merchants sell to consumers who buy a small amount of produce. A familiar example of the B2C model would be supermarkets where consumers buy their shopping weekly but they wouldn’t normally bulk buy anything.
Consumer to consumer (C2C):
C2C is a relatively new business model where consumers who previously bought something seek to resell this item to another consumer. Through marketplaces like eBay and Craigslist, this can be easy and quite lucrative for selling items that you no longer have a use for.
The Benefits of eCommerce
There is a reason why e-Commerce websites are leading the market in sales growth among businesses worldwide. With an e-commerce website and the internet becoming an essential requirement of everyday life, businesses and consumers are learning to take advantage of the numerous benefits of eCommerce. Most notable benefits of businesses selling online include:
Global market: A physical store will always be limited by a geographical area it can serve. An online store, or any other type of eCommerce business for that matter, has the whole world as its market. Going from a local customer base to a global market at no additional cost is really one of the greatest advantages of trading online.
Around-the-clock availability: Another great benefit of running an online business is that it is always open. For a merchant, it’s a dramatic increase in sales opportunities; for a customer, it’s a convenient and immediately available option. Unrestricted by the working hours, eCommerce businesses can serve customers 24/7/365.
Reduced costs: eCommerce businesses benefit from significantly lower running costs. As there’s no need to hire sales staff or maintain a physical storefront, the major eCommerce costs go to warehousing and product storage. And those running a dropshipping business enjoy even lower upfront investment requirements. As merchants are able to save on operational costs, they can offer better deals and discounts to their customers.
Inventory management: eCommerce businesses can automate their inventory management by using electronic tools to accelerate ordering, delivery and payment procedures. It’s saving businesses billions in operational and inventory costs.
Targeted marketing: With access to such a wealth of customer data and an opportunity to keep an eye on customer buying habits as well as the emerging industry trends, eCommerce businesses can stay agile and shape their marketing efforts to provide a better-tailored experience and find more new customers. Just consider for a moment that you have a chance to address thousands of your customers by their first name; that is something already.
Serving niche markets: Running a niche brick-and-mortar business is extremely difficult. There’s almost no chance of scaling it unless a niche product becomes mainstream. By tapping into a global market, on the other hand, eCommerce retailers can build a highly profitable niche business without any further investment. Using online search capabilities, customers from any corner of the world can find and purchase your products.
Working from anywhere: Often, running an eCommerce business means that you don’t need to sit in an office from 9 to 5 or suffer through a commute day-in and day-out. A laptop and a good internet connection is all it takes to manage your business from anywhere in the world.
How to start an eCommerce business
There is a logical order in how you would go about building an eCommerce online store. Although setting up an actual online store would probably take less than a day, researching, building, launching and growing a profitable eCommerce business is a multi-layered process involving a number of steps and decisions.
Choosing and sourcing a product:
The first step to starting an eCommerce business is deciding what products you’re going to sell. Finding a profitable idea can be hard work, so be prepared to do some serious digging and thinking. It’s essential that you choose products with healthy margins that will allow you to turn a profit and scale the business in the future. Once you know what you want to sell, you’ll need to decide how and where you’re going to source the products. The four main methods of sourcing products and inventory are making, manufacturing, wholesale and drop shipping.
Conducting research and planning ahead:
Your product idea will dictate which aspects of the market you need to research, but some of the most important areas to look into will be your competition, pricing strategy, and your unique value proposition. At this point, it is also a good idea to draft a business plan that will help you visualize your growth strategy and identify any potential threats or obstacles.
Getting your brand right:
Now that you have a promising product idea and a clear overview of the market, it’s time to start thinking about the key elements of your store, such as your brand name, domain name, brand guidelines, and your logo. Getting your brand right from the start can help accelerate the growth and conquer the hearts of potential customers. Before turning your attention to building the store, you should spend some time studying the basics of SEO, or hire a marketing research specialist so that your business gets off to a good start.
Deciding how you will sell:
The actual setting up of your online shop can be achieved in two ways:
this means either developing it yourself or hire an agency that specializes in e-commerce web design.
Shopify can make building an online store a quick and easy process. However, there is still an e commerce architecture that will need to be in place for your site to have visibility. eCommerce solutions from M28 Marketing can assist you in getting the store off the ground and start selling your products.
Before launching:
At this stage, you’ll be itching to get the store out into the World Wide Web. However, make sure you’re well prepared to measure the success of your launch – defining your key performance indicators upfront will help you track your progress and performance and fix any issues as they emerge. Other important things to take care of include setting up your social media profiles, getting the email marketing ready, installing Google Analytics, doing keyword research, defining your shipping strategy and finalizing the launch promotion plan. Yes, that’s a lot of work, but a good start is half the job done. When you complete the checklist, try running your store through the Shopify store grader to catch errors if there are any.
After launching:
Welcome to the grind! This is where the real work begins. Having launched your online store, you should immediately move on to the promotion phase. Marketing your store and optimizing conversions will be your daily bread and butter from now on. You should also experiment with regularly expanding or refreshing your inventory. It is a particularly easy thing to do for drop shipping, as they can import new drop shipping products in minutes, but it should remain a priority even if you’re manufacturing or making the products yourself. Staying ahead of the curve will take some testing.
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