At this point it’s pretty safe to say the world of business will never be the same. The pandemic has forced us to make a lot of changes to our lives but they aren’t all bad. Many eCommerce businesses are still thriving as more and more consumers are choosing to do their shopping online. If you are an existing business wanting to move into the eCommerce space or a new business owner looking to get an eCommerce venture off the ground, you’ve come to the right place. In this article, we’ll be diving into the benefits of eCommerce business and showing you how you can make sure yours is a success.
The Benefits of Starting an eCommerce Business
Given the state of the world, the benefits of an eCommerce business are pretty obvious. Many brick and mortar businesses are currently unable to operate. Those that are operating, are experiencing a significant drop in sales as many customers aren’t comfortable leaving their homes for a spot of light shopping or to hang out in restaurants and coffee shops. If you are an existing brick and mortar business, now is a good time to look into opportunities to expand into eCommerce. There are benefits of selling online outside of the pandemic. Running a business online can lower your overall operational costs, expand the reach of your business, and give you better insight into your customer base.
Craft an Idea
Intersect Passion with Practicality
It’s very hard to make a business a great success if you don’t actually care about the product. Before starting an eCommerce business, think about the things you are passionate about. This will help you come up with a product that you will want to commit to selling long term. Once you have made a list of things you are passionate about, try to identify any pain points you have related to that topic. This is how you find a unique value proposition that separates you from the competition.
Get Specific With Your Product or Service
The internet is a big place so don’t be afraid to get specific with your offering. Once you’ve thought about your pain points, try breaking them down into smaller, more specific micro problems. This will help you create a product with a really unique and original angle. Creating a product that is specific to the needs of your target audience will give you a huge advantage in the marketplace.
Start from the Inside Out
Another approach to finding a product or service to start your eCommerce business is to structure it around a pain point within an industry you already work in and have plenty of knowledge around. This gives you an advantage as you’ve already got one foot in the door. There will be less research involved in starting your business and you’ll already have insights into the existing challenges within the industry.
You want your business to grow over time. That’s why it’s important to understand the difference between fads and trends. A fad is something that is fleeting and will fizzle out quickly. You might be lucky enough to make money with a fad in the short term but you probably won’t be able to turn this venture into your life’s work. A trend, on the other hand, will grow in popularity and evolve over time, often creating a permanent change in the market.
It can be difficult to identify the difference between fads and trends, but there are some signs that might help you spot them. A fad gains momentum really quickly because it has shallow value. Think Gangham Style and fidget spinners. A trend will move slower, initially only being noticed by thought leaders and slowly growing in momentum over time, think social media, or meat-free diets.
Research Competitor Feedback
If you have a few product ideas in mind, do some research into your potential competitors. We recommend you start by checking out their social media channels. Take note of how customers are engaging with the brand. Look at both positive and negative feedback. Keep an eye out for any information on what the competitor is doing well and what they could improve on.
Food for Thought: eCommerce Business Ideas
To get you started with brainstorming ideas for your eCommerce business here are some popular industries you might want to consider:
- Beauty and health products
- Handmade goods
- Clothing and fashion labels
- Second hand products – ie, vintage furniture, jewelry or clothing
- Content writing services
- Tutoring services
- Consulting services
- Web design services
Dive into Market Research
Once you’ve decided on a product or service you’d like to sell online, it’s time to dive deeper into market research. This will help you gather information about who your customers are and how you can provide them with exactly what they need.
Market research should help you find out the following information about your customers:
- Customer needs (pain points)
- Desires (what they are looking for in a good product)
- Customer demographic (age, gender, profession, etc.) and how this may impact their needs and desires
- How much they are willing to spend on a product or service (price points)
Your market research should include looking into the future of your chosen industry to decipher what possible challenges your business could face. You’ll also want to explore the past. What has been the evolution of your industry over the years? This will help you identify what products have worked, what hasn’t worked, and what marketing strategies have been affective.
Construct a Business Plan
One of the first steps when starting a business should be to construct a business plan. An eCommerce business plan will lay out all of the logistics of your business, both from a product standpoint and from the way the site itself will operate to connect your product with consumers. A business plan is important because it acts as a roadmap for you to follow. It also gives potential investors information about your business and demonstrates its potential.
Your eCommerce business plan should include:
- Company description
- Product description
- Operations – This refers to the logistics of how your business will provide the service or product.
- Market analysis
- Marketing strategy
- Financial projections- This section is especially important if you are seeking funding from investors.
If you are an existing business transitioning to eCommerce because of the pandemic there are a number of resources available to support you during this transition. The SBA’s Paycheck Protection Program provides businesses that have been affected by the pandemic with financial support. You can apply for an SBA PPP loan through NorthOne.
Set up a Business Bank Account
It’s important that you keep your business expenses and personal expenses separate. This will protect your personal assets in case of an audit or other legal concerns. A separate business banking account also makes it much easier to file your business taxes.
We think every business should have a mobile bank account, however this particularly useful for eCommerce businesses. NorthOne is a completely digital bank. This gives you flexibility to manage your money wherever you are. We have integrations allowing you to connect your favorite business tools to your bank account. This will make the daily operations of your online business much smoother.
Register Your Business
Whether your business is brick and mortar or entirely online you are still required to have registrations and permits to operate legally. ECommerce business owners will need to obtain the following licenses/permits:
- Business operation license
- This license allows you to conduct business in your specific city, county, and state.
- Requirements, rules, and regulations vary depending on your state. Contact your city hall or state’s secretary of state for more information.
- Employer identification number (EIN)
- Federal tax ID number issued by the IRS
- This is needed to make your business a distinct tax entity
- Doing business as (DBA) license
- This is only needed if you are seeking to operate your online business under a name that is different from your personal name.
- Seller’s permit
- This allows you to sell goods or services online.
- The rules and regulations depend on the state. Check with your operating state’s licensing office or department of revenue for details on applying for a seller’s permit.
- Sales tax license
- Home-based businesses (eCommerce) are required to pay sales tax on all items sold. Sales tax varies from state to state, so research your state’s specific rules.
- Home occupation permit
- This is needed if you are exclusively running your site from your home.
- Occupational license
- Whether or not you need an occupational license depends on the industry you’re in.
Brand Your Business
Now that you’ve done your research and legally registered your business, it’s time for the fun part! Branding is a very important part of having a successful business. Here are some of the key steps you’ll need to follow to build a strong brand for your business:
Build a logo
A powerful logo provides context and helps people recognize your business. Your logo should be a reflection of your business and ideally something that doesn’t change as your business evolves. Take some time to consider some of your competitors’ logos to get an idea of what you like and don’t like. Consider color psychology to ensure you are using a color scheme that elicits positive emotions from your customers. You’ll also need to consider typography. The text and font you choose is just as important as color.
Create a brand mission statement
A clear mission statement will inspire your customers to engage with your brand in a meaningful way. It will also act as a focal point for your actions and decision when operating your business. As it continues to grow, you’ll be able to refer to your mission statement as a reminder of what you are trying to achieve.
Create a brand slogan
The mission statement will guide your brand slogan. A brand slogan should be clear and concise. The best slogans can summarize a brand in just a few words. Think Nike’s “Just do it.” or Mcdonald’s “I’m lovin it.” You want to appeal to positive emotions in your customers. This could be inspiring like Mike’s slogan, or fun, and joyful like McDonald’s. A good slogan will become recognizable over time as an extension of your brand.
Leverage social platforms
In today’s world, it’s very important to leverage social media. This helps increase visibility and allows your customers to engage with your brand directly. Make sure the social channels align with your brand identity and the content you post is in line with your mission statement. A great example of a brand with a strong social media presence is Patagonia. Their mission is to ‘provide sustainable earth-friendly clothing.’ The content on their social channels reflects this mission. The brand is constantly posting about sustainability and connecting with their audience through content that is meaningful to them.
Set Up Your Site
These days you can’t really operate a successful business without some form of web presence. With an eCommerce business, this is even more important. Your website will act as your storefront, showing off your products and welcoming your customers to your brand. Let’s go through the essential steps of setting up a website.
Step 1: Get a domain
Before you build your website you’ll need to secure a domain name for your business. There are a lot of websites out there so it’s not always possible to get your first choice. However, it is important that you get a domain that is simple and as close to your business name as possible so that it is easy for customers to find and remember.
Step 2: Select a platform
When it comes to selecting the right platform for your business, you have three options: software as a service, off-the-shelf software, or bespoke software.
These days software as a service is probably the most popular option as demonstrated by the growing success of Shopify. Software as a service platforms make setting up your site quick and easy. Users typically pay a monthly fee to use the platform. NorthOne has Shopify integrations so you can connect your site directly to your bank account.
Off-the-shelf software like Microsoft Office or Adobe products have a one-time order to use and a license fee. These products have been through extensive testing to make sure they are providing as many valuable features to businesses as possible. However, if your business is relatively small and simple, you probably won’t need all these features and they can be a little overwhelming. Off-the-shelf software is also more work to customize.
The third option is bespoke software. This is ideal for small singular businesses that need really unique and specific features. Keep in mind bespoke websites can be expensive so make sure you’ve got the budget before you hire anyone to start building you a website.
Get Acquainted with Digital Marketing
Digital marketing is how you generate visibility for your business online. Your digital marketing efforts will drive traffic to your website. This is particularly important for eCommerce businesses as you do not have the benefit of ‘street traffic’ and rely solely on web traffic.
You can leverage social media to maximize your brand exposure by frequently sharing content with links back to your main website.
You’ll need to identify what types of phrases your target audience is searching for in Google and create content around this topic using a blog and, if it’s in your budget, paid keyword advertising.
Online reviews can help to generate brand trust so encourage happy customers to leave positive reviews and create content that they want to share with their friends.
It’s important that you are consistent with the content you create so that your site stays relevant to your audience and they have a reason to continue returning to your site.
Launch Your Site
Once you’ve launched your site you’ll want to invest in analytics tools to help you monitor its success. Here are some popular tools we guarantee you’ll find useful:
This tool tracks traffic and provides deeper insights into the demographics of this traffic and how each user is interacting with the page.
This tool helps you track clicks and impressions of your site’s pages and published content. Impressions refer to how visible your page is within the search engine results pages (SERPS) and clicks refer to how many times a user is clicking through to your site. This should be your main metric for measuring the success of your site. This tool also allows you to submit new content for Google to crawl and index, which is vital to helping you work your way through the SERPs to more visible positions on the first few pages of Google.
This tool allows you to build heatmaps to dive into the specifics of how a user is interacting with each page on your site. This insight will help you improve your site to maximize conversions.
This tool provides insight into your business’s Facebook account. This will give you an idea of what content works and what doesn’t.
It’s important you keep a close eye on your site and to make sure you are constantly monitoring it for bugs. You want your site to be easy to access and navigate, providing your customers with seamless user experience.
Drive Traffic. Build Your Brand.
Driving traffic to your website is an incredibly important part of owning an eCommerce business. If no one’s coming to your website, no one’s buying your products. You need to make the effort to invest time into building and sharing branded content whether it be organically or through paid marketing. Here are some tips for driving traffic.
Create a content strategy
Content production can be incredibly time consuming but it’s also vital to the visibility of your business. That’s why we encourage businesses to create a content strategy and build your content in advance. If it’s in your budget, you could hire a content specialist to build content for your website. Make sure when you are planning and building content you are taking the time to research keywords that are associated with your product so this content is always working to drive traffic to your website.
Develop a social media strategy
Equally as important as developing a content marketing strategy is developing a social media strategy. Make sure you include the following elements in your social media strategy:
Goals: Don’t just identify what you want to achieve, identify how you will measure success in order to accurately conclude whether these goals are being reached.
Target audience: Profile the ideal user.
Channels: Based on the above information, select which social media channels will be most effective in driving traffic to your website and establishing a brand presence.
Social Content: Create a variety of content to be shared across social media channels.
Process: Set up a procedure for executing your social media strategy. Create a content calendar for each channel. This provides an organized way of creating and publishing content. Sync channels up with analytics tools to successfully monitor activity.
And there you have it! Your eCommerce business is all set up and ready to go! Now all you have to do is wait for the customers to start pouring in. Whether you’re an existing business struggling during the pandemic, or someone looking to take that leap and finally be your own boss, there is no better time to start building your eCommerce business than now.