Saturday, June 24, 2017

Choosing an E-commerce Platform

So you have decided that you want to sell a product online. What next?

Building an Online Presence: First of all, get an understanding of the challenges and risks ahead of you. Get a clear vision of what it means to engage in e-commerce before you jump into the task of setting up a new website. In the decision to establish a site, keep in mind that this is a business. You are not creating a blog or a personal expression. Your goal is to make money selling products online. So put aside the need to create a lovely website or to provide pithy information.; those components are only relevant in as far as they help you sell products.

Storing the Product for Delivery: How will you manage the product after assembly? Your product must be available in sufficient quantity that users can receive it quickly. And you must have a means by which it can be stored and is still ready to be shipped promptly. How are you going to do that?

Gathering Customer Attention: Next comes the challenge of customers finding you and your marketing of the product to gather attention and enthusiasm. How will you stand out among the thousands of e-commerce websites already out there? Is your product so unique that it will engender a high-profit margin? Is it a commodity which will succeed based mostly on price? Also, consider if you want to offer special pricing to entice users to purchase your product such as a sale in July or a discount for first customers. Thus, how much control do you want to have over the marketing aspect of your product?

After the Sale: Once a customer has decided to buy your product you need to be informed of their purchase and engage a rapid and consistent system of shipping that product out to the customer reliably and efficiently. In a global market, users could be anywhere and potentially speak any language. You need to decide how far and wide you're going to ship and what methods you were going to use to ship the products.

When the Sale Sours: Unfortunately, the story does not always end there. Many times the product is seen as defective on the part of the customer, or there are shipping errors. These mistakes can lead to negative impressions of your product which harm sales in the future. How will you handle a request for returns and refund? Do you have a window upon which you will accept returns and outside of which you will reject them? Payments too can become problematic. The buyer can refuse the credit card payment. Depending on the credit cards you accept, you may have little or no recourse but to refund customers.

Happy Customers: Once you have established a relationship with a client, you may want to engage them in a system of longer-term retention to enable repeat sales or sales of similar products. You need to decide how integrated that system will be and time intensive for you to maintain. Similarly, will you somehow reward purchases and enable users to receive a discount for additional products? How will you get them to write a review or expressing interest in your products?

Choosing an E-commerce Platform: There are essentially three choices for an e-commerce platform.
  1. First, you can go it alone. That means you control the servers, the domains, the security certificates, and the payment system such as PayPal. 
  2. The second option would be to engage one of the many shopping platforms such Shopify. Shopify competes in a complicated Market. There are other shopping platforms which you would want to consider such as Bigcommerce Magento yo Kart and Big Cartel.
  3. The last option is the gorilla in the room, and that is Amazon. For the novice to e-commerce, Amazon has an incredibly complete help system with video and audio which explain components of the process step by step. 
Going it Alone: The above issues make it clear that creating your e-commerce website from scratch is unlikely to be a good choice and likely to be a source of risk and headaches. Few sellers choose this route anymore, and you should probably discard it.

e-commerce Platforms besides Amazon: Shopify is an example of a very easy e-commerce platform to engage. It will address most of your needs. But it doesn't necessarily have all the features you are looking for

Although the e-commerce platforms are popular, anyone who has purchased on Amazon understands its market power and influence. Unless there is a compelling reason to choose an e-commerce platform, Amazon should be your first choice to introduce your product to the market and engender sales. If sales disappoint or you feel that better returns could be obtained, then you can certainly engage a marketing platform to supplement Amazon or potentially to replace it. But as you start to investigate the value of e-commerce for your product Amazon and it's support for your growing operation, Amazon is a powerful and easy place to start.

Amazon
Amazon constrains your site to the Amazon interface and approach. If you feel that a unique selling strategy is important or essential to your product's sales, then the look and feel of the Amazon experience may not work for your product. On Amazon, you will find many unique and different products. Those companies have likely assumed that the marketing power and sales potential of Amazon outweigh possible benefits of a custom-designed website regarding sales or the expense of effort required.

Amazon comes in two flavors to the seller one in which you continue to manage warehousing and fulfillment and mainly use their structure for marketing, customer acquisition, and customer relationship management. Amazon brings s together many of the pieces involved in e-commerce and has established standards at a higher level than large shopping platforms.

Amazon FBA
Amazon is interested in your forming an even closer relationship by engaging in their fulfillment by Amazon (FBA) program. FBA removes almost all of the challenges of e-commerce in exchange for your paying Amazon for this service. FBA is provided in two sections, one for the individual and one for the business depending on the number of sales. If the number of sales is beyond 40 items per month, then the business strategy is the optimal choice.

Why Amazon FBA
Amazon FBA offers a solution to almost all e-commerce questions and concerns. It handles warehousing, fast shipping, returns, payment systems, and product reviews. It also has tools to get an overview of your product, assess sales, and identify areas where you can improve the performance of your sales operation. You essentially lose control and gain freedom.

Amazon's goal is to get you to utilize Amazon FBA to sell your product, and they have developed a system that will accomplish this aim. Further Amazon is always endeavoring to expand its market and better serve its customers. As seen by Amazon's next day delivery and same day delivery, they will continue to push the boundaries of e-commerce and to delight customers by addressing their desire for a clean, seamless, and quick purchasing experience. So keep in mind that this is a field of rapid change. For your product will you gain from such rapid change or be harmed by an inability to keep up with the field of e-commerce? FBA is a bet that Amazon will stay on top of e-commerce. That assumption hasn't been proven wrong yet.

1 comment:

  1. Brad,
    Excellent post covering the ins and outs of becoming a seller on Amazon. I always wondered how they handled all the different vendors. They certainly have created amazing systems to help businesses. I learned a valuable lesson in our last class about ordering off Amazon and paying attention to who is the vendor. When I placed my order for Winning Angels I thought it was coming direct from Amazon-NOT. It took two weeks for it to arrive and the seller's customer service never had timely information when I would email about tracking the package. Not only that, although the book was brand new, it was missing pages. It was stressful waiting for it to arrive. I now know to look at who is the seller more carefully as well as the arrival date.
    Cece

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