Small Business Ecommerce

Any conversation or discussion about this topic really needs to start with a clear definition of exactly what "ecommerce" is. According the American Heritage Dictionary, ecommerce is defined as "Commerce that is transacted electronically, as over the Internet." So basically it entails commerce (the exchange of goods and services) over the Internet. Sounds pretty simple, right?

From my viewpoint, there are also various levels of ecommerce that need to be defined as well. For example, does a single page web site advertising a local business equate to "ecommerce"? Some might say yes, but I would politely disagree. Let's get into the various layers of ecommerce for small businesses:

Informational site - In it's simplest form, these are basically small informational sites that small businesses use predominately for advertising purposes. They typically consist of a home page, about us page, testimonial page, etc. and are really designed as a simple advertising vehicle versus a form of ecommerce. Depending on the nature of the business, some clients or sales can be attributed to these types of sites, but most of the value they bring is a form of low cost advertising.

Info site with interaction - These type of sites are generally a step up from a typical info site as they usually offer some form of interaction for the customer. For example, a visitor can enter data and get a quote, or request a sample, etc. Most of these site will be completed by a web designer and are basically static (as in the content doesn't change that often).

Blog or Web 2.0 site - While blogs have been around for years, they are only now becoming more mainstream for small businesses. Blogging platforms like Wordpress and Blogger are extremely simple to set up and provide a fairly easy method for site owners to update data. The one big advantage to blogs for small business ecommerce is that fact that they are very interactive. In many cases, a visitor can post a comment, upload a picture, deliver a unsolicited testimonial all through the platform.

Intermediate site with a shopping cart - These types of sites are really the beginning of a true "ecommerce" site as they generally allow the visitor or shopper to purchase either goods or services and then check-out online. In most cases, web sites of this nature are a static site that incorporates some type of shopping cart software that showcases goods or services. These sites typically integrate with a 3rd party payment system or systems (credit card, Paypal, Google Checkout, etc.) to allow shoppers to make purchases.

Full ecommerce site - Sites of this nature are professional sites that are built on a specific ecommerce platform that may be self hosted or hosted as part of a package. A full ecommerce site will generally have features like inventory management, secure area for returning shoppers, post sale management, CRM management, product reviews, etc. Typically these types of web sites are selling products versus services. 

It should be noted that not all business models are a good fit for true "ecommerce". Depending on  the model, an informational site or basic presence blog may be a better fit. A common dilemma with service based businesses involves discovering a method or way to market the service online.

For example, I have a client that is a professional videographer with a web site. When I first started consulting for him, one idea that he had centered around the need for his site to incorporate an ecommerce storefront. The more we talked about the products and services that he offered, the following became evident:

1. His services and products were based on a localized geography and he didn't really feature any products that he would sell or ship outside of the geographical location.
2. Keyword research in his market at the localized level didn't reveal a significant level of searches.

In the end, he and I decided that an ecommerce platform wouldn't really be a cost effective option for him based on the cost versus projected benefit. He was far better suited to invest the money in a professional informational site that targeted his local geography and included some form of integrated metrics so he could measure the effectiveness.

The real question for you is probably "do I need a small business ecommerce platform or software for my business?"  Unfortunately, that really a decision that only you can make.

Ask any e-commerce vendor for input and you'll almost always get an "absolutely". If you take the time to evaluate your products and services, it isn't that difficult to make an educated decision.

While projecting results is difficult, it's very important to try to do so that you can attempt to assign some kind of cost versus expected results scenario. Be as accurate as possible on your projections for evaluation purposes.

I once asked a client to come with a cost versus benefits scenario for a possible ecommerce store and he elected to use his projected best case model instead of a more realistic model for comparison purposes. In the end, I advised against an ecommerce integration as I my potential sales numbers weren't even close to his. He elected to move forward and invested several thousand dollars into an ecommerce system. Fast forward 24 months, and I don't think the profit from sales on that site have even covered 1/3 of the original cost (not to mention the monthly on-going maintenance costs).

My point here is to be honest and accurate with your expectations and projections. You'll be a much happier business owner in the end.