In this article, we are going to show you how to choose an ecommerce service provider.
You’ve been buying online for years. You love buying online. It’s one of the reasons you want to open your own ecommerce business.
But you have a ton of questions on how ecommerce actually works.
- Do you have to know how to code?
- Do you have to build your own website?
- How much does it cost?
We’ll cover ecommerce basics so you’ll be able to make the best choice for your new business.
How to Choose an Ecommerce Service Provider: The Ecommerce Universe
The decision to open an online store is easy. You want to own your own business. Congrats!
But figuring out how exactly what kind of online store you want could be a bit more complicated because you have lots of choices. And this decision depends on your goals, finances, and target market.
Here’s a quick breakdown of your ecommerce service provider options:
A marketplace is a large platform where sellers can create their own shops and customers can browse hundreds or thousands of smaller online stores. The marketplace doesn’t sell anything itself, but it handles all the transactions and then pays the store owner. Sellers generally either pay a monthly fee or a percentage of each sale.
- You don’t need any technical skills
- Affordable (some are free to start)
- A large number of users
- Some help with tax issues like the EU VAT (more on that later)
- You don’t own your online store
- You have to follow their rules, policies, etc.
- Competition can be fierce
Etsy is an ecommerce marketplace for handmade goods. It has millions of active sellers and active buyers. That’s a huge customer base! Large marketplaces can be great for some shops, but membership comes with a price.
Yes, you have access to millions of active buyers. However, you have to find ways to stand out from a very crowded field. This includes marketing and choosing a price point (affordable or luxury?).
Marketplaces like Etsy can be difficult for some store owners as you have to follow all their policies. For example, Three Bird Nest was an extremely successful Etsy shop but branched out with their own ecommerce website after policy disputes.
Do some research and see if your specific niche has a marketplace site. Check prices, policies, monthly fees, tax support and look at the seller feedback. This may be a good choice if you know your products can compete in a crowded field.
Ecommerce Platform Website
An ecommerce platform allows sellers to create a shop using a pre-designed template. This means your shop is hosted by the platform, but each shop is independent and not connected to each other. This is great for those that are new to ecommerce and many platforms have affordable monthly fees.
- You don’t have to worry about hosting
- The platform handles all the sales transactions
- You don’t need any special technical skills to set up your shop
- Some help with tax issues like the EU VAT
- You don’t own your shop
- You have to follow all rules and policies
- You may have to pay extra for some features
Think of a platform website as your own online store. Although you don’t own it, you’re in charge of advertising, social media, pricing, product descriptions, blogging, etc. The platform handles hosting, sales transactions, and most have tax support.
If you’re not tech-savvy and don’t want to be part of a larger (and crowded) marketplace, consider opening a site on an ecommerce platform.
Compare prices, features and design (you want your shop to stand out) and make sure it’s compatible with mobile devices.
Build Your Own Website
A website is a long-term goal for many online stores. It’s a property that you own. You decide exactly how it’s run and what it looks like. You can do anything you want since you own it. And you can buy and sell it like the real-estate that it actually is.
Although you’re responsible for hosting, design, and upkeep of your own website, you have many easy ecommerce choices. You don’t have to build your own checkout system, as you can easily install a plugin that handles sales transactions. Plus, many ecommerce service providers integrate with the most common website technology like WordPress and Blogger.
I know it can sound overwhelming, but this is a great choice if you’re a blogger who already has a site.
- Complete freedom to do what you want
- Perfect for bloggers
- Easy to use ecommerce options
- Can be more expensive than platforms if you have to pay a web designer
- You are responsible for security
- You have to keep the site’s programs updated
Having your own website is a great choice if you want total control of your online store, and you have the skills to build a website or hire someone to manage it for you. It’s the best option for those that want to build a platform to share content (like videos and blog posts) and create a home base for their customers.
How to Choose an Ecommerce Service Provider: Innovative Features to Consider
Not all ecommerce service providers are equal.
Some are more sophisticated than others and are always adding innovative features. Since ecommerce is still evolving, these innovations can be the difference between minor and major success.
Here’re a few innovations that help launch successful ecommerce websites:
Abandoned Shopping Cart Features
Although 63.85% of customers abandon their carts during the checkout process, this does not mean that you’ve lost the sale.
That’s where abandoned shopping cart features come in. You can set up gentle email reminders that will hopefully entice your customers to finish buying your product. One of the best ways to do this is to share a discount code or a limited time offer.
PDF Stamping for Extra Security
In the digital age, security is always a concern. Especially for those who create digital products like PDF eBooks and guides.
Selz sellers can create a PDF Stamp that is embedded in the product and is stamped with the buyer’s name. With this added level of protection, your products won’t be able to be duplicated anonymously.
Integrations with Partners
It’s time-consuming to run a business, especially when you’re starting out. Budding entrepreneurs rely on tools to help us get things done – fast.
Look for an ecommerce service provider that works with programs you use every day. Through direct integrations, Selz connects to the apps and platforms you need to run your business with ease.
From email marketing platforms to shipping providers and accounting software, make sure the ecommerce service provider you choose integrates with the tools you need.
Shipping has exploded in the ecommerce age as one of the most important issues for buyers. In fact, 60% of ecommerce companies say “free shipping with conditions” is their most successful marketing tool.
You have a lot of choices when it comes to shipping. Flat rates, free shipping, or free shipping on orders of a set amount (you’re $10 away from qualifying for free shipping – who can resist an offer like that!). So the ecommerce service provider you choose must support whatever shipping options you choose.
The world of ecommerce is always evolving. New and innovative technologies are always improving how sellers connect with buyers. ecommerce service providers are always looking for new ways to help business owners increase monthly sales.
Choose an ecommerce solution that best supports your new business and your overall goals.
How to Choose an Ecommerce Service Provider: Narrowing Down Your Choices
I’ve just outlined three basic ecommerce options and many features to consider. And I know it can be overwhelming. But don’t worry – I’m going to help you through the decision process that’s best for your new business.
Here’re a few questions to ask when deciding on an ecommerce service provider:
Am I comfortable using the technology?
Anyone who can post pictures to Facebook has the technical skills to use a marketplace or ecommerce platform. The majority of ecommerce options have very easy dashboards and a lot of support.
Selz has how-to videos and has an entire blog dedicated to helping business owners grow their online stores. Depending on what your business sells, there’s a category that will help guide you on how to sell your products.
You don’t need any special technical skills to open an online store. You want to spend your time marketing your new business, not dealing with tech issues you don’t understand.
Does it work on mobile devices?
Mobile buying is the fasted growing segment in ecommerce. Consumers want to buy from their phones and tablets, but 41% of buyers don’t complete a purchase on mobile devices because the credit card information is too difficult to enter, and 47% give up because the checkout process takes too long.
Whatever ecommerce service provider you choose must have a mobile platform that works on a wide variety of devices. This is not a debatable point. You want to make every possible sale and set your online store up for success. Having a mobile option is an essential part of your overall strategy.
Selz works on any mobile device, tablet or desktop. You can preview your ecommerce website so you know exactly what it will look like.
Does it fit into my budget?
New business owners come in all shapes and sizes. From million-dollar startups to those that bootstrap with the change in their pockets.
And there are ecommerce options for every budget.
So don’t worry if you’re starting with limited funds. You’ll be able to open your online store and have the ability to add more features as you grow.
What about payments?
Choosing the best option for a payment gateway is pretty simple. Start with looking at the options that are offered in your country. Not all countries offer the same choices, so check what’s available in your country first.
It’s also important to understand how sellers will get paid. After all, this is one of the most important aspects of your business – incoming cash flow! You can learn more about how to accept payments on your website here.
Does it have tax support?
Taxes – everyone’s favorite subject!
Payment gateways help you collect the right sales tax depending on country and item. However, not all ecommerce service providers have the same features that make paying your taxes easier.
For example, the European Union (EU) has a Value Added Tax (VAT) that require any digital business that sells to anyone in the EU to collect taxes based on the customer’s location – not on the seller’s location. That means you have to collect taxes from sales in EU countries not where your business is located and pay each country its VAT.
Handling taxes can be complicated, so you want to choose an ecommerce service provider that has a lot of helpful tools and support. There’s a lot to manage as a new business owner. Make sure the tax system you choose makes your job easier, not more complicated.
There’s a lot to learn as a new small business owner. You want to make the right decision the first time. The bottom line is that you want an ecommerce service provider that best fits your unique new business. And with a little research, you’ll find the best fit.
How to Choose an Ecommerce Service Provider: You’re Not Alone
We’ve covered a lot of ground. You should have a basic understanding of what your business needs to handle ecommerce. Take your time and make the best decision for your skill level, budget and overall business goals.
One thing that may help you decide what ecommerce service provider would be best for your business is the level of support it gives its sellers.
Just remember that you’re not in this by yourself. The best ecommerce service provider will be your partner every step of the way.