Les Jones

E-commerce > How to Get Started in E-commerce

A friend emailed me to ask for help in getting his friend set up with an e-commerce system. I figured that's a pretty common question, so I'm copying my response here, slightly spruced up and expanded.

Nowadays there are a ton of good e-commerce solutions available. Which one is best depends on how many parts numbers you have, what sales volume you anticipate, and how much integration you need with other systems (such as accounting, fulfillment, or inventory software).

Here's an outline of e-commerce hosting options, starting with the easiest:

eBay
Easy squeezy, no setup, and it includes built-in marketing (which is the trickiest part of e-commerce) in the form of the millions of people who search eBay for the express purpose of buying products. Doesn't include credit card processing, but you can bring your own, and most eBay users have PayPal accounts. Very convenient checkout for existing eBay users. Besides general listings you can set up an eBay store for a bit more permanence. Obviously it works well for oddball items, but it also works for regular inventory. I bought a laptop power supply from a guy who sells Compaq power supplies and batteries on a continuous basis.

PayPal shopping cart
Easy squeezy setup. Takes PayPal and credit cards. Very convenient checkout for existing PayPal users.

Yahoo! Shopping
A smidge harder to setup than the above, but still very easy. Yahoo! Shopping will accept a tab-delimited text file with your part numbers, prices, descriptions, quantity, image names, etc., and automatically generate your catalog. That makes it easy to manage your catalog and inventory with your favorite spreadsheet or database program. Incudes credit card processing. One downside is that there is a per-item listing charge, so it's not the best system if you have thousands of parts but very low sales volume. Some built-in marketing in the form of Yahoo! Shopping's search feature. You can integrate Yahoo! Shopping into your existing Web site to some degree, though most of the shopping and checkout will occur on Yahoo!'s site.

Pre-installed e-commerce hosting
Most Web hosting companies offer at least one plan that includes pre-installed e-commerce software with an open source SQL backend, a shared SSL certificate for secure transactions, and credit card processing. The e-commerce system is generally Miva. Cost is as little as $10 per month.

Full-blown e-commerce packages
Finally, you can buy a commercial package or use an open source system and install it yourself. Depending on the system you will probably need to get your own credit card merchant account (starts at about $20 a month) and SSL certificate ($200 a year through Thawte). You'll be responsible for patching the software for security problems. Requires administrative skill and time. The advantage is that you can get a very sophisticated system that meets your needs in terms of integrating with your other software.

These systems are very diverse and I can't recommend one by brand, so I'll offer just one bit of advice. The main advantage of these systems is that they're highly capable and customizable. Make sure they include alterable source code and choose a system largely based on the underlying programming or Web scripting language it uses - ASP, PHP, Java, etc. Your Web administrator will need to be able to program in that same language to take full advantage of the system.

The next step: marketing

Once your store is online, you'll need to advertise it. Effective marketing will make or break your business. I've tried different marketing approaches, and only two have consistently worked.

Search engine keyword advertising
In this system you bid on search terms at major search engines. When people search for those terms, the highest bidders appear first. You only pay when someone clicks through to your Web site. Cost is anywhere from 10 cents a click to several dollars click. You can minimize expenses and get better results by buying very specific keywords such as brand names and product names that you sell. Google and Yahoo! Search Marketing (formerly Overture, formerly Goto.com) are the two best programs.

Price comparison services
In this system, you upload a list of products you resell, with manufacturer part number, price, and a URL for a page on your Web site where customers can buy that product. When people search for that item, they see a list of sites selling the product so that they can compare prices. You only pay when people click through to your site, and cost ranges from 10 cents a click to a dollar. Major players include Shopping.com, Nextag, MySimon, PriceGrabber, and DealTime. Google's Froogle is another example, and it's free.

Posted by lesjones