We’ve seen consistent and steady growth in eCommerce businesses across the globe in recent years, a trend that’s only been accelerated by the 2020 pandemic with an incredible 25% surge in online sales. With the industry now estimated to be worth around $4.2 trillion globally, and with even more growth to come, there’s no better time to launch a brand new venture. We’re on hand to walk you through how to start an eCommerce business and how to identify the pitfalls.
Step One – Define Your Niche and Brand
You can’t start a business without properly researching the product or service you’re going to sell. What specialist skills and knowledge do you possess? How will you stand out from the crowd? How will you target your customers?
If you can successfully identify your niche your chances of success increase dramatically. Start by looking at other businesses that operate in the industry you plan to launch in and research what strategies these organizations have for success.
For example, you may be starting your own cybersecurity consulting business, but competition is fierce in this industry. Why not specialize in helping victims of identity fraud? You can build your brand around this and it’ll help you get found much more easily in your local area.
Do as much research as possible before you launch to find as many potential niche areas as you can.
Step Two – Create a Business Plan
Think of your business plan like your road map. You’ll never reach your destination without it. The best plans outline how much capital you’ll need, how you’re going to source your products, and how you’re going to market to your target audience. Plus, it’ll help you prepare for peaks and troughs in sales, allow you to have emergency funding set aside for tough times, and will be your evolving strategy throughout the lifetime of your business.
Most importantly, though, a plan will make sure you set benchmarks that you can track your success against. How many sales do you need to break even? How many customers do you want to reach in year one? What critical decisions need to be made at each milestone? These are all questions to ask yourself when writing your plan.
Step Three – Arrange Funding
It’s rare to find a new eCommerce business that doesn’t need at least some capital to be spent upfront to get started. eCommerce business loans are used to purchase stock, hire staff, and cover the cost of web design. The business plan we covered in step two will be a vital tool in proving the viability of your venture and will be a key document that lenders will want to see.
You can, of course, use your savings to get your business off the ground, but it’s always wise to keep some personal funds set aside for an emergency and let a low interest loan do the heavy lifting for you in the early days of your new business.
Step Four – Build Your Online Store
Due to an explosion of web hosting services and user-friendly drag-and-drop builders, it’s now easier than ever to build an online store. Many providers offer pre-made templates so you could have a basic store set up in just a few hours, as well as your website published and ready to go on the same day.
However, if you have a more complex business or hundreds of products you need to sell, you’ll probably want to engage the services of a professional web developer. This will usually set you back several thousand dollars, but the final cost will depend on the type of website you want to create.
The primary benefit of hiring a professional is that your site will be totally tailored to your brand and the web developer can make all the tweaks and changes that’ll help target your niche. We’d recommend doing some shopping around and research a mix of DIY web builders and professionals to see which is right for your store.
Step Five – Launch a Marketing Campaign
Now you’ve got your website up and running, your funding secured, and your strategy outlined in your plan, it’s time to market your services. It’s probably a good idea to start targeting customers in your local area. You might want to pay for Facebook or Google ads that are highly specialized to your niche and geographic location to increase the chances of being found.
Get yourself out to networking events too. Your local chamber of commerce will be a gold mine of contacts and could provide you with your initial customer base. Remember, it’s an incredibly competitive world out there and personal relationships will be vital in getting your business going.
Step Six – Tracking Sales and Making Improvements
There are plenty of eCommerce store monitoring tools out there these days that’ll track sales, give you statistics on your different target markets, monitor click-through and sales rates, and automate sending of emails for abandoned carts.
A comprehensive list of statistics will tell you exactly where you’re doing well and which areas need improvement. Find out which products aren’t selling and you can make tweaks and improvements. Many businesses use these statistics to inform the next marketing campaign, seeing how successful it was by monitoring new sales and site visits.
Most of these tracking tools come with additional costs but given the information provided, many organizations find them invaluable.
Alternatively, if you're in search of a fulfilment solution, consider partnering with James & James 3PL company. Their expertise lies in helping businesses enhance efficiency and productivity while delivering exceptional customer service. By entrusting them with inventory management and fulfilment operations, business owners can reduce risks and focus on other critical aspects of their operations. With James & James as your fulfilment partner, you can enjoy the benefits of streamlined logistics and a dedicated team working towards your success.
Conclusion
There’s never been a better time to start a new eCommerce business. Barriers to entry are low, websites can be created easily, and you can be up and running with an online store in just a few hours.
However, there’s a lot of groundwork to be done before you get started, and the more preparation you do, the greater your chances of success. Know exactly who your target market is, calculate how much funding you’ll need, pull together a comprehensive marketing plan, and have clear milestones in place. Do this and you’ll be streets ahead of the competition.
