E-commerce has never been more popular and starting an online store is one of the best ways to grow a business.
E-commerce has many advantages over a brick and mortar store, as online shopping can significantly expand your customer base.
Before you move on to ecommerce, however, you need to weigh the pros and cons of running an ecommerce business.
That way, you’ll know how to maximize opportunities and anticipate risks when doing business online.
The ten most important advantages of e-commerce
An online shop can bring many benefits to your business.
There are many good reasons to do eCommerce, and if you haven’t created an online store yet, I recommend you get started.
In my opinion, these are the main advantages of eCommerce:
1. Lower operating costs than offline shops
When weighing the pros and cons of eCommerce, not all factors are created equal.
And among the benefits, number one is cost.
You don’t have to pay rent, utility bills, or other maintenance fees in an online store. While you still have to buy some services like a web hosting plan and domain name, the overall cost is much lower than running a physical store.
If you go for a website plan like the Zyro eCommerce plan, you can sell your products online for just € 13.90 / month.
Zyro is great for beginners and all of their plans come with free hosting and a subdomain so you can publish your site right after customizing.
2. High margins on sales of digital products
Selling digital products can be very profitable because the cost of production stays the same no matter how many of them you sell.
By having your own online store, you don’t have to pay transaction fees for every sale you make, resulting in even more profits.
3. Worldwide potential audience
Once you’ve set up and up and running your online store, it’s available to everyone around the world. The only things that someone will need to buy from you is an internet connection and a credit card.
Whether you sell physical or digital products, there is always the possibility that your next customer will be from another country or continent.
Additionally, selling products worldwide is now much easier thanks to the many reputable payment and shipping services in the market.
You can accept foreign currencies and deliver the order internationally without worrying too much.
4. Your online business is open 24/7
Their online store is accessible all day so people can shop around the clock no matter where they live.
Even if you cannot process their order immediately, your customers can still browse and shop in your shop.
5. Customers keep buying more
It is estimated that around 2.14 billion people will shop online worldwide in 2021. And the total amount of money spent on e-commerce is increasing, with studies showing it keeps increasing every year.
Of course, it doesn’t take long to realize that your business model would miss out on a lot of potential revenue if you didn’t try to take advantage of online shopping.
Starting an online store can mean the difference between attracting new customers and losing to your competition. For many companies, the ability to target potential customers with online advertising has resulted in skyrocketing sales.
6. An online shop is easy to optimize
Scaling your business online is easy, especially if you are using a website builder. You can do this yourself with no prior knowledge of coding or design.
If your website needs to handle a heavy traffic, most website builders can easily upgrade to a larger plan.
For example at Zyro, one of the cheapest website builders out there – their basic eCommerce plan is $ 7.90 per month for a small business, but once you need to scale you can switch to eCommerce + which can handle unlimited traffic for only € 13.90 per month.
In addition, it is just as easy to change the look of the website with a website builder as there are many beautiful web templates to choose from.
You also have the option to view user reviews and testimonials to target new customers.
7. Growth and expansion are much easier than offline retail
In terms of pros and cons, e-commerce has growth potential over traditional retail.
Unlike a physical store, an ecommerce site is not limited by its physical location. You can add as many products as you can without worrying about space constraints.
Plus, you don’t have to rent a building or hire more people to reach customers outside of your area. Local language support and delivery options would be enough to appeal to them.
In addition, the excess money can be used for something bigger, such as expanding your product inventory or further optimizing the website.
8. Simple and inexpensive outsourcing of work
If you want to improve your website but don’t have the skills, there are many freelancers and agencies to choose from.
From providing promotional images to redesigning your website, it’s easy to find the right person for the job online. Hiring costs are also relatively different, so you can make a selection based on your budget.
9. Advanced marketing resources at a low cost
Today, digital marketing resources are not only accessible, but also affordable and easy to implement. Therefore, it is easier than ever to run a one-person business.
One of the best examples of this is online advertising.
From social media to Adwords, you can advertise yourself without an agency or expensive brokerage.
You can promote your shop on search engines, Facebook, Instagram and more for targeted access to millions of potential customers every day.
10. Adapt quickly to changes in demand
Like any other business, you need to do constant research to keep up with the demands of the market. Fortunately, for an online business, market research is relatively easy and quick to do.
One of the most popular methods is keyword research. It enables you to find out about the current trends in the industry and gives you an insight into what customers may need or want.
Another way to discover a trend is through social media platforms. If you pay close attention to online discussions, you are likely to find new opportunities worth targeting.
You can then monitor your website traffic and marketing campaigns with the help of web analytics tools that allow you to make data-driven decisions to improve your business.
The four biggest drawbacks of ecommerce
Of course, every business model, both online and offline, always has disadvantages and here we will discuss the disadvantages of eCommerce.
While I believe eCommerce is the best option to grow your business – knowing the risks beforehand will enable you to respond appropriately to any problems you might encounter in the future.
1. You need to have an efficient shipping strategy in place
Shipping is an essential part of any e-commerce business. There are many aspects that you need to consider such as:
- Shipping. You have to choose between a free shipping model, a flat rate shipping, or a shipping cost model.
- packaging. Choose from free packaging or order a custom one for your brand.
- Delivery service. The type of service you will use affects the overall shipping operation and management of the company.
- International Shipping. You need to prepare the required documentation and determine who will pay the duties and taxes.
- Return. Decide who will pay the return shipping costs if customers want to refund their purchase.
Implementing the wrong shipping strategy can harm your business. On the one hand, you can lose customers if you charge expensive delivery charges. However, if you fail to make a profit from paying all shipping costs, it can negatively affect the growth of your business.
If you want to avoid such problems, calculate all possible costs that may be incurred and offer customers a transparent shipping process on your website.
2. Availability, security and fraud protection of the eCommerce store are of vital importance
One of the hardest steps in starting an online business is choosing a hosting provider that will make sure your business is safe and available at all times.
Choose a website provider who can actually guarantee these things as customers won’t come back after a bad experience. Zyro, like many other providers, has a 99.99% uptime guarantee and a free SSL certificate that is included with all e-commerce plans.
3. Higher returns than offline stores
Since customers can’t try your products right away, you need to be ready to accept product returns.
To ensure a great shopping experience for your customers, your store must have a return policy. Make it clear what your customers can expect from you in terms of the processes and requirements for returns.
4. Very high competition
There are thousands of online stores on the internet, which can make it difficult for new businesses to stand out.
However, don’t let the competition stop you from starting your own online business.
Focus on high quality products and excellent service from the start. With the right marketing plans, your business will gain momentum much faster.