The ecommerce industry has made it a whole lot easier to open an online store, helping solopreneurs and small businesses sell their products to a global market.
Dropshipping, Print on demand, wholesaling, affiliate marketing, there are many different business models to choose from.
But what happens when a business outgrows the platform it started with, and needs to change?
Here are five cycles of ecommerce to consider.
The research has been done, the niche market selected and the brand name has been chosen.
The business model is put into place and the product range is fixed. Now is the time to pick the right channel to start the business.
Most sole traders and small businesses choose a package ecommerce service, which acts as a Software as a Service host. It’s the fastest and cheapest way to get online and display the product range.
Many new businesses choose from SaaS providers such as Shopify, Wix, Shopware and Bigcommerce. They all have their own benefits and disadvantages, and different fee structures.
For a monthly subscription, SaaS providers offer everything the business needs, and they are great for testing out an idea.
Using supplied website templates, it is very easy to produce a relatively smart online presence, and the SaaS providers will also supply Payment Card Industry compliance for online credit card processing, and Secure Sockets Layer certificates for secure communications, both of which are absolutely vital.
And we’re off!
So, the business is up and running and ready to provide excellent customer service to their new clients.
Because the range has been chosen well, products start to fly off the shelves and business looks good for the future.
The business increases its monthly subscription to get access to additional sales and analytical tools, and more online storage for video presentations.
The customer base grows, and more data is harvested for future marketing strategies.
Evolution and niggles
The ecommerce market is so congested that it is difficult to stand out as a unique online store. Most of the SaaS providers offer some templates for building a website, and with limited adjustments, many of them are visually quite similar.
However, by concentrating on the right market, with new products and top customer service, the business continues to grow and attract new clients.
The Internet offers something that was not possible before, a way to search for a single product in multiple places. Price comparisons are the norm, as everyone is looking for a bargain, such as discounts and other incentives to make a purchase.
If one product has free shipping compared to another similar offering, the consumer will usually go for the best cost, even if there is a longer delay in arrival.
It is a constant struggle to stay on top of the ecommerce hill, and eventually a business will have to make big decisions about the future.
Order fulfillment issues
A problem that most companies would be happy to see is generating more orders than it can process, but it does cause problems.
Consumers are fickle, and they do not care if a business has delivery problems, they simply want the product at their doorstep in as short a time as possible.
The business could outsource order fulfillment to a third party specialist, but that would cut into the profits.
Data breaches are disastrous for any business, with the total loss of trust added, particularly for small online businesses.
While SaaS providers offer robust cybersecurity protection, many small businesses can be targeted on their personal devices. They do not have the financial backing of major brands and cannot afford a secure framework.
Downtime is costly and it is necessary to have a security framework to combat the threats of hackers, viruses and ransomware.
The best time to switch to a larger platform
Migrating a website to a different platform is a big decision, and each business should do an analysis of the pros and cons of switching. Here are several factors that suggest a switch to a larger platform.
One of the biggest problems with SaaS providers is page loading speed. In this fast paced world, customers demand a swift reaction when they arrive at a webpage. If not, they leave quickly without visiting other pages and go to another site.
A bounce rate is based on the percentage of visitors to a website who leave without checking out any other pages compared to total visits. For example, if a website has 50 visits a day, and 10 of them leave on the front page, the bounce rate is 20%.
Bounce rates are very important to monitor the attractiveness of a website. By that, I mean that the first page is relevant to the visitor and not misleading, it is mobile friendly with good text size, and is not filled with bots and pop ups.
An average bounce rate between 26% and 70% is considered reasonable, with 26-40 being excellent.
On some ecommerce websites, sometimes just finding the search bar is tricky. The front page gives no clear information about the available products or services and how to find them.
If the search bar reveals a product and then forces the user to go back to the main page after viewing it is annoying and good cause for a sharp exit.
Navigation should be smooth and effortless, not clunky.
Some ecommerce platforms have a trigger when a certain amount of transactions are completed and force the business to upgrade.
Sometimes the upgrades contain tools and features that are unnecessary to the business and are wasted, but the subscription remains higher than before.
How to switch safely and quickly
It may sound fairly simple, just back up the data and transfer everything to another site, like moving contacts to a new phone.
But in fact it is quite complex to migrate to a new platform, as URLs will change and a 301 redirect will have to be left on the original website. There is a possibility of customer drop offs.
A big decision is whether to continue using another SaaS platform tailored for enterprise level or go for a custom in-house solution, with control over all facets of the business.
Replatforming to an Enterprise level SaaS or PaaS
Expectations should be clearly laid out well in advance of any migration, otherwise there are going to be problems. The whole point of the move is to improve the service to the customer base and increase profits, while reducing unnecessary expenditures.
Software as a Service providers offer a complete solution to business needs, while Platform as a Service providers host, manage and maintain the hardware and software included in the platform, while allowing the business to take control of data and any other applications it wishes to develop.
There are several top quality Enterprise level SaaS and PaaS providers in the market, highly respected names as well as some that may not be so familiar but still offer superb ‘umbrella’ solutions.
Umbrella solutions include many different interrelated units that work together to provide a complete business package.
Customer-specific data collection
Different sales channels (social media, B2B, live streaming, etc.)
Customer service management
Analytics and reports
Marketing and SEO
Scalability and flexibility
These software packages are expensive, and they are not a one-stop solution. They will probably have to be tweaked to match the business needs, using either in-house technical skill if available, or an outsourced team of specialists in platform migration.
Logically, it is best to find a SaaS provider which is the closest to the business technical and financial needs.
Safety and Speed
Usually mutually exclusive, these two words should come together when migrating to a larger ecommerce platform. If a business is underperforming due to its present setup, it is vital to make the switch as swiftly and safely as possible.
Unless the business has a team of highly competent technicians, it will be necessary to outsource the transition. The trick is to find a specialist enterprise ecommerce partner to manage the whole process, test, and provide support after the system is running.
While choosing a custom solution will be expensive, as Payment Card Industry compliance is a requirement, and will require the external auditing of the payment system periodically.
SSL is also key to the integrity of the business website, protecting all levels of the domain with a secure, encrypted connection between customers and the business.
But with all the extra costs, the development can be focused on what the business requires without any bloatware, making a more efficient and leaner proposition.
Benefits of switching to a larger platform
When a brick and mortar business grew, it would build new stores in other locations to increase revenue and reputation. Costly but effective. Or by franchising the company name and products, such as fast food chains or fitness clubs.
When an online ecommerce business understands that it is time to expand, the procedure is completely different, although it is still costly.
When dealing with customer data, site security is paramount, and the larger platforms provide a robust security system that fully defends their clients against the latest security threats.
Integration with resource planning, customer management, data analysis and sales and marketing systems streamlines business operations and reduces wasted time and effort.
Personalized experiences for shoppers
WIth the regular ecommerce platforms, designed for small to medium sized businesses, most of the websites look very similar, and do not jump off the screen.
A sleek front page will stand out and give an impression of uniqueness and professionalism. With added tools for upselling to customers, the business will be able to show higher conversion and order rates. Repeat customers will have an added touch of feeling connected with the business.
Product line upsizing
A business in its early stages might have 50-100 stock keeping units (SKUs) to start the ball rolling, but wish to increase the number and type of products on offer, perhaps due to customer requests or current trends.
In order to make the website search friendly, it is vital to have a high level of organisation of products and categories, something a smaller platform would struggle with.
Search engine optimization
All businesses want to be on the front pages of search engines, and the larger enterprise platforms know this and provide the tools to tune the website for greater visibility online.
There are many different rules and regulations for overseas ecommerce, and the enterprise platforms will be aware of them and how to comply with taxation and Government policies.
Additionally, these platforms will provide support to multiple languages and currencies.
Smaller ecommerce platforms do not allow much flexibility or scalability to their clients, it’s basically WYSIWYG with a few minor tweaks.
Headless solutions offer a specific set of choices for each business, allowing them to create a perfect customer experience.
It is possible to react quickly to changes in the market, and customers have multiple interfaces with which to connect, from web apps to mobile to social media and more.
Most of the enterprise ecommerce platform providers offer a headless solution that allows businesses to get a complete view over all products and services.
If an established ecommerce business is experiencing a drop in sales, more customer complaints and slower delivery times, it would be smart to check out alternatives in ecommerce platforms to see if there is a viable option to correct these faults.
In most situations not a lot can be done while remaining with the same SaaS provider from the start of the business.
So it is a choice of whether to upgrade to the highest subscription of the current provider, or to move away and take on a new challenge, with better alignment to the business requirements.