Small business owners know that the Internet can be a valuable business channel, but for many of them, ecommerce is still clouded in mystery. Choosing the tools and software to manage an online business is the easy part of the equation. It's the factors that small business owners typically don't consider before launching that can make or break an ecommerce venture.
What many small business owners don't realize is that ecommerce is hard. Calling ecommerce "part art and part science," Victor Hanna, CEO and of The Betty Mills Company, says he doesn't want to turn anyone off, but the reality is you need to be prepared for a long winter. "Ecommerce is a lot harder than you think it is," he says. It's the subtle things that small business owners have to know and do well in order to be successful.
7 Things to Know Before Starting an Ecommerce Business
Before you start an ecommerce business, you need to figure out how and where the Web fits in your overall business strategy. You need to find a niche and determine what aspects of ecommerce are critical to your business. Then, experts recommend that you leverage the right technologies and continue to evaluate your ecommerce business strategy on a yearly basis.
Small Business Computing spoke with leading experts and successful business owners to come up with this list of seven things every small business owner needs to know before starting an ecommerce venture.
1. Know how the Web fits into your business strategy
"Your ecommerce strategy should reflect your overall business strategy, and you should use in a way that reflects your business model," says Daniel Toubian, managing consultant, retail practice at Maxymiser. For example, high-ticket, business-to-business companies may use a website as an online brochure or as a lead generation vehicle. A services-related business, says Toubian, may leverage a website's digital capabilities to showcase case studies and customer testimonials. In addition, a consumer product company may use ecommerce to drive sales across multiple channels—ecommerce, mobile commerce and in-store.
2. Know your niche and go deep
"If you're out there just selling stuff, it's going to be difficult unless you have an edge or a new product that no one else sells," says Victor Hanna. "When we started our ecommerce company [in 2002], the few janitorial supply shops online appeared to be small companies with very little technology and no succession planning in their business." Hanna attributes his company's success to picking a specialized niche and going very, deep in that category.
3. Rank priorities, implement features, and evaluate yearly
You need to know what role the Web will play in your business. "Know what you want to accomplish with your digital strategy," says Toubian. A roadmap to success starts with ranking critical business initiatives and budgeting for those accordingly, he says. For example, if you need to know what industry the visitor belongs to, then have a way to glean that information on your site because it's critical to your success. You may need to set aside a larger portion of your budget for these priorities and put less money on other website features.
Small businesses tend to start small, and that's perfectly OK, as long as you strategically map out a plan for growth. Don't just throw additional functionality out there. "In your first year, expect to use the Web for just one purpose. Then plan yearly revamps for an additional functionality using the customer information you glean as you go along," says Toubian.