6 Things You Should Know Before Starting an Online Store
By Storeplum Editorial
Posted | 8 min read
Is this going to be the year when you decide to start your own online business?
The pandemic has been rough on everyone. Especially small business owners. But there are exceptional entrepreneurs who made most of this opportunity and started their million dollar ecommerce businesses.
It’s great that you have decided to move forward with starting your own ecommerce business. But just like preparing for an exam or a job interview, it's important to do your homework and be prepared before starting an ecommerce business.
Things you should know before starting an ecommerce business-
- Have a business plan
- Choosing a CRM
- Keeping a track of costs
- Understand what ecommerce platform works best for you
- Budgets for marketing spend and SEO
- Start educating through your content
1. Having a business plan
The old adage- ‘If you fail to plan, then you plan to fail’ sums up the importance of a business plan.
For a long time, there has been this common misconception about ecommerce- If I start an online store, I’ll start receiving tons of orders immediately. That is always not true.
Tons of orders is a result of meticulous planning of every single detail before even launching your online store.
These include but are not limited to-
Finding the right value addition to your customers
It can be as simple as the way your products are packaged or identifying how you are going to provide after sales support/service to your customers. Find out what your target customer really wants and provide them a solution that will make their lives easy.
Identifying potential sales channels.
Just relying on your online store to bring business is never going to be enough. You need to have at least 5 different channels to begin with. The most common ones in ecommerce are email marketing, content marketing, social media, networking groups, affiliate marketing, etc
Identifying key resources that are critical for you to succeed in your business
These are your staff, the platform and tools that you use, vendors, shipping partners and more.
A business plan will not only help you to try and test new markets immediately, but will also help you strategize your activities if there is no product market fit for your offerings.
On the other hand, a lack of business plan will often put you in a situation where you feel clueless if things do not go a certain way as you anticipated.
2. Choosing a Customer Relationship Management (CRM) tool
Consider this scenario - You just launched your website and the word is spreading slowly. Every day, as you speak to several potential customers, you are managing a lead list in a spreadsheet. Soon, it's overwhelming to keep a track of new users, old users, users who are interested but they have some questions, etc.
A customer relationship management tool or a CRM will not save you hours but days of work when you kickstart your marketing efforts.
A majority of CRM these days provide an end-to-end solution which includes email integrations, customer segmentation and a lot more.
We at Storeplum are huge fans of HubSpot. It’s completely free to begin with and offers a lot of functionalities which are sufficient to begin with.
3. Keeping a track of expenses
As a business owner, it is imperative for you to keep track of all of your expenses which are needed to run your day to day operations.
Some of the common form of expenses include-
- Customer acquisition cost through different marketing channels
- Technology and platform
- Costs associated with vendors/suppliers
- After sales expenses like shipping partners
Have a way to track and identify these expenses early on. This data will help you in finding customer acquisition costs, break-evens, profits and losses, etc
4. Understand what ecommerce platform works best for you
With so many ecommerce website builders available out there, it’s difficult to choose what’s best for your needs.
Some of the important factors to consider while building an online store-
a. Time needed to launch
Unless you want a custom made ecommerce store for your business, time to launch on most of the ecommerce platforms is more or less similar.
With custom ecommerce store development- expect at least 3-4 months of lead time with too much feature discussions with your technical team. Why spend so much time when better alternatives are already available?
Given the ease of use and amount of plugins available, it is always recommended to go with an e-commerce platform to start your online store.
b. Building and maintenance costs
Platforms like Shopify and Woocommerce tend to get expensive as your business expands. As you grow, you’ll also have to consider the costs of hiring a specialist who can make custom changes for you.
Some platforms charge heavy transaction fees for every sale made on the website. If your product ticket size is smaller, the excessive transaction fees may not be sustainable.
Custom software development on the other hand has separate challenges of its own. Unless you have a technical person on your team, you’ll spend not just your time but also a lot of money for features and plugins which are already available in the market on ecommerce platforms.
For comparison - take a look at potential savings when you choose Storeplum over custom software development for building your online store.
c. Growth Monitoring
Building an online store on any ecommerce platform is easy but growing it can be tricky. That is why it is important to monitor your growth from day 1.
For many, this is like treading into uncharted territory. It is not known which metrics are important and which ones are really important.
Web traffic, conversion rate, ways to optimize conversion rates are some of the Key Performance Indicators for your online store.
Storeplum provides an in-built growth hub Storeplum Infinity. A one of a kind growth metric system which evaluates your store growth on several parameters and recommends actionable strategies for improvements.
Storeplum customers have seen over 73.12% improvement in conversions after implementing recommendations by Storeplum Infinity.
5. Budgets for marketing spend and SEO
Never consider marketing as an expense. It’s an investment you make to get the word out there to your targeted customer segment.
If done right, you should start seeing 3x in returns on your investment. Word of mouth is often slow and highly ineffective given the kind of tools and technologies are available out there.
Social media ads perform well when you are planning to launch a new product or a product category. The instant reach can give you a good idea validation for your product.
On the other hand, Google Ads have proven to be one of the best ways to promote your product or online store on the Internet. It is just the nature of search engines, where relevant ads are shown to customers who are looking to buy your product or a similar product on the Internet.
A general extension of Google Ads is search engine optimization or SEO.
Many neglect the benefits of SEO altogether. Search engine optimization may take time, but, when done right, it brings a steady stream of traffic to your website without increasing your marketing spend.
It’s like having compound interests on your investments. Once you invest in SEO, you’ll see its compounding benefits for years to come.
Every Storeplum website is SEO optimized by default.
You can add not only the basics like title, meta description, etc but also some of the advanced SEO functions like sitelinks, featured snippets, product reviews and ratings, etc.
6. Start educating through your content
A majority of your content marketing efforts should be focused on educating your potential customers and not directly selling them in every opportunity that you see.
Educating customers about your products has never been so important. With information available on finger tips, a vast majority of Internet users make purchase decisions based on reviews, learning more about the product, its benefits etc.
For this, you need a content management system which is tied to your website. Why is this important you may ask- The more quality content that you publish on your website, the more google is going to rank it better. Better ranks on Google are directly proportional to your website conversions.
By the way, you do not have to limit yourself to only a content management system to educate your customers. Start a channel on Youtube about your products, make IG videos, find every opportunity to reach your target audience through the platforms which they use.
Given the immediate reach which is offered by ecommerce stores, it can be enticing to jump into starting one right away without enough thought process.
Running a business on the Internet is no different than running a brick and mortar store, you need to have a business plan, know about competitors, have a budget for marketing and many other things for a successful online store.
Our goal at Storeplum is to educate you in understanding what it takes to run a successful business on the Internet. If you found this writeup useful, then subscribe to our email newsletter where we send free tips and tricks on running a successful business on the Internet.
Storeplum's in-house editorial team brings to you the best content when it comes to growing your online business on the Internet. We write about growth hacks, case studies, government schemes and other related information for e-commerce business.