How to Pick the Right Small Business Ecommerce Provider

By Julie Knudson | Posted March 05, 2014

Like any long-term relationship, choosing an ecommerce platform for your small business will take some legwork. Before you commit your business to a solution, be sure to ask all prospective ecommerce vendors these seven key questions.

7 Questions to Ask Potential Ecommerce Partners

1. What are the specific features of each proposed solution?

The products and services offered by any one ecommerce vendor are likely to be similar to those available through a number of competing companies. "Sometimes even the same vendor will offer two nearly identical products with just a couple of differences," says Jerry Jao, CEO of Santa Monica, Calif.-based Retention Science.

It's important that businesses take the time to clearly understand the solutions they're evaluating before making any formal purchasing commitment. "Marketing managers get pitched on different technologies all day long, and it can be easy for them all to get muddled together," Jao says. He suggests using a simple spreadsheet that compares and contrasts the solutions you're considering against the features you've determined matter most to your business.

2. How does the ecommerce provider bill for services?

Not only should business owners understand how much their small business ecommerce solution will cost, but also how the provider breaks out and bills those costs. Chris Langway, vice president and ecommerce business strategist at Boston-based Optaros, says that fee structures vary, and final pricing may depend on a variety of factors.

"There are a lot of options in terms of the amount of money small businesses are going to spend and how they're going to spend it, whether it's a license-based model or a transaction fee or a percent of revenue." If the pricing tier arrangement means your costs will fluctuate, that's something you'll need to build into your budget. It's also prudent to ask what discounted tiers may become available if you decide to launch additional features later.

3. What is the ecommerce vendor's reach?

Whether you're looking for a vendor to provide a simple shopping cart platform or a full-fledged data analytics package, it's crucial to know how much information feeds into the platform. "You need to consider the size of the data source, who uses that platform, and whether they have scalability," explains Kevin North, president and CEO of Terapeak, an analytics firm based in Palo Alto, Calif.

"Ask about the amount of data the vendor draws from," says North. "What are the sources, how many marketplaces, and is that information in real-time?" The answers will help you understand how the ecommerce platform you're considering will be able to adapt to (or perhaps even anticipate) market trends and competitive pressures.

4. Can we add features later?

The onboarding requirements for large-scale or feature-intensive ecommerce solutions can quickly overwhelm small businesses, particularly those with lean internal staffing. Rather than start out with a suite of bells and whistles you may not have the resources—time, knowledge, staffing—to use right away, Jao says it's better to begin with something you can actually use.

"[Businesses] can waste a lot of time and resources if they sign up for a robust platform, and it takes months to install or countless hours to conduct employee training," Jao explains. "It's often best to start on the lower end and build from there." Once you have the platform up and running, adding or expanding features is often less time-consuming and provides a better long-term return on your investment.

5. Does this ecommerce solution offer a good mobile experience?

You risk losing revenue by not providing a solid mobile experience for customers who use smartphones and tablets to shop online. Langway says customers no longer tolerate small businesses that subject them to a poor mobile experience. "When customers go to your mobile site, they expect it to be easy to navigate, easy to buy and easy to pay." If your business doesn't meet those expectations, customers will look to your competitors who do offer a mobile experience that meets their needs.

6. Does the ecommerce provider have references?

You can gauge an ecommerce provider's ability to serve your needs by reviewing its history of serving other businesses. If you're going to rely on a vendor's technologies to transact business, it's worth your time to ensure they have a good track record.

Client references don't necessarily have to be in your sector, but North says their feedback should be universally positive across the features you're considering (think down time, cart errors or anything that creates a bad customer experience). "It's anything where a customer touch point could be negative or where you could have a potentially poor customer perception," North says.

7. Is the ecommerce vendor solid?

Longevity is a good sign, but it isn't the only indicator of an ecommerce vendor's strength and reputation. North suggests asking for concrete information as one way to help determine whether a partner has the experience and resources to be there for the long haul.

"Ask about revenues, ask about growth," says North. "What is the actual goal of the business? Do they want to sell it to a larger firm? Do they want to scale it? Do they want to go public?" Any one of these factors may not be a deal breaker by itself but, taken together, this information may show how the vendor's direction could potentially impact your company down the road.

Julie Knudson is a freelance writer whose articles have appeared in technology magazines including BizTech, Processor, and For The Record. She has covered technology issues for publications in other industries, from foodservice to insurance, and she also writes a recurring column in Integrated Systems Contractor magazine.

Do you have a comment or question about this article or other small business topics in general? Speak out in the SmallBusinessComputing.com Forums. Join the discussion today!

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