If you’d like to build a profit-driving online store from the ground up, you’ve come to the right place!
Plus, marketing opportunities for online stores are endless. But that’s not all. The benefits of E-commerce stores include cheaper marketing and workforce compared to physical stores.
An online store also leaves you without the worry of office rent, utilities, office maintenance, and managing employees. As most E-commerce platforms are automated, once you’ve configured your online store, you’re halfway done.Not forgetting that countless reputable platforms offer talented freelancers to help you at half the cost.Want to start your own online store?Let’s get into it!
10 Steps to Build an Online Store
Step One: Do Research on Your Niche and Target Audience
Your target audience and niche are the pinnacles of your business. You need to know WHO you’re selling to and WHAT you’re selling.
Nailing this information down will give you a rational idea of how to market and manufacture your product. Doing this is vital, so your ideal buyer purchases your product.
What is your niche?
A niche is a specialized, focused area that you base your products and brand on. Start determining your niche by choosing the products you want to sell.
Consider these points
- Is there a market for your product?
- Do you have the resources and knowledge to manufacture this product?
- What connection does this product have to you or your brand?
- How will your product stand out from other products in its range?
Be as specific as possible for your niche. This will help you provide products of value to your target audience. Your target consumers will also know what to expect from your brand. And how they can enjoy your offerings.
For example, let’s say you want to start a T-shirt business. Instead of selling “cool” T-shirts, you could sell motivational T-shirts or T-shirts dedicated to Rock bands.
Instead of your ideal buyer being somebody who wants a cool shirt (which is practically everybody). You’ve narrowed your ideal buyer down to someone who wants a cool Rock ‘n Roll shirt.
Meaning that from this point onward, you would tailor your marketing to appeal to someone who loves Rock music.
See! It’s that simple.
Who is your ideal buyer?
Your ideal buyer and niche pretty much work in hand. Because when you determine your niche, you’re also developing an idea of who your ideal buyer is.
For your reference, an ideal buyer is a consumer who has a need/desire for your product. You tailor your entire business to solve the pain points of your ideal buyers. Your ideal buyers lay the foundation of high sales, increased brand awareness, brand loyalty, and much more.
Determining your ideal buyer is paramount to your business for the same reason as determining your niche is: You’ll base all your marketing efforts on this information.
Step Two: Are You Going to be Dropshipping or Holding Products?
Dropshipping is when a vendor does not hold their products. Instead, the vendor sends the client’s order to the supplier who ships the product to the client.
A dropshipping online store does not own its inventory.
But not all online stores work this way. You can store your products and not depend on a third-party supplier to handle your deliveries and inventory.
Let’s check the pros and cons of both methods to help you decide which one is ideal for your business.
Advantages of Dropshipping
Disadvantages of Dropshipping
|Lower Startup Cost. It’s not cheap to rent and maintain a warehouse to hold your stock. Dropshipping eliminates this cost.||Less Control Over Order Fulfillments. Because you’re not fulfilling the orders and a third party is, you have limited control. Suppliers who fall behind on orders or do a “sloppy” job will cause dissatisfied customers.|
|Less Worry About Inventory. Desperately selling too much inventory is not fun. And dropshipping will prevent this problem from happening.||Rely on a Third-party’s Stock. You don’t have control over your supplier’s inventory. So if they run out of stock, you won’t have products to sell.|
|Sell and Test Products Without Risk. Dropshipping allows you to test products before fully committing to selling them. This is an excellent method to determine which products work best for your brand.||Reduced Income. A huge drawback of dropshipping is that it’s challenging to find bulk pricing. You have to sell a lot to cover your expenses. Buying dropshipping products can be more expensive than buying your own inventory in bulk.|
|It Saves Time. Dropshipping means you don’t have to spend your time sorting, labeling, and packaging your stock. Instead, someone else does it for you!||Limited Product Information. As you don’t handle the products you sell, you won’t have a first-hand idea of your products. You’ll have to relay questions from customers to your supplier for a response. And this system can be time-consuming.|
|Easy to Scale. Because most of the work falls on a supplier and not you or your team, a dropshipping business is easier to scale. Pairing this with how efficient dropshipping is, you’re able to fulfill more orders at lower costs and require fewer workers.||Customer Service Problems. Because of the middleman “between” you and your products, customer service queries take time. Before resolving complaints or disputes, you have to get your supplier involved. Doing this is likely to complicate the matter further and adds too many steps to simple situations.|
Advantages of Holding Your Products
Disadvantages of Holding Your Products
|Better Customer Service. As you control your stock, you can deliver more accurate solutions to customers’ queries and complaints.||Space for Stock. If you hold your inventory, you need space. This can be a costly affair. You might have to rent out office or warehouse space if you can’t store your inventory in your home. Remember that you need to store your inventory in a safe place.|
|Bulk Discounts. If you hold your products, chances are the supplier you find will offer bulk discounts. This is fantastic because you can get your inventory for less!||More Effort Required. Holding your inventory means managing, planning, ordering, and packaging your products. This will need a lot of your time and effort. Depending on your supply and demand, you may have to hire extra workers.|
|Provide a Personalized Experience. Because there is no third-party handling your stock, you can personalize your stock to appeal to your customers. Doing this will give your consumers a more memorable experience with your brand.||Higher Upfront Costs. Storing, managing, and controlling your inventory requires a higher capital than dropshipping.|
|Increased Consumers. This advantage works hand-in-hand with the one above. Customers who have buying confidence in your brand will spread the word about your brand. Word-of-mouth is one of the best channels to attract new customers so you can count on higher demand!||Harder to Grow. Because of the high demand for time, effort, and capital, holding your inventory might make starting a business harder for you. This is not an ideal starting point for someone who doesn’t have the time or capital.|
Our Verdict: Dropshipping vs. Holding Inventory
In our opinion, it doesn’t have to be either-or. Why not both? We believe that the strategic way to approach starting an online store is by first dropshipping and then holding your inventory.
Dropshipping is easier to get going. Especially if you’re new to E-commerce. You’ll also have enough resources to find out which products sell and which don’t. When your dropshipping business is on its feet, you can start investing in your own inventory.
Once you have your own inventory, you can start using Jeff Bezos’ Amazon as a marketplace and aim to win the BUY BOX. The buy box is a white box on the right hand of Amazon’s product detail page. Consumers can add items available in the buy box to their cart.
The buy box is a hit as over 80% of Amazon’s desktop purchases root from the buy box!
Step Three: Brainstorm a Business Name and Get Your Domain Registered
Once you know how your business will handle its inventory, you can move on to brainstorm a catchy business name. And registering a domain for your online store.
Tips for Naming An Online Store
- Make sure the name is future-proofed. Like your products, you want your business’s name to survive centuries. Avoid names that restrict you from evolving your product or business aim. You never know what opportunities or changes your business will experience.
- Choose a user-friendly name. Pick a business name that is easy to spell, pronounce and type. Why? This makes it easier for customers to remember the name of your business, search for it, and use it in conversation.
- Research business name ideas. You don’t want the name of your business to be the name of some other big company completely overshadowing you. Giving your business a unique name will put you in a league of your own. Do extensive research to make sure no other business has your name.
- Get feedback on potential names. If you find a business name that you like, ask your friends and family for their opinion on it. Doing this will give you a realistic idea of how other people might respond to your online store’s name.
- You HAVE to be happy with the name. Once you’ve established your business, you don’t want to change its name. Make sure that you are happy with the name you choose!
How to Register Your Domain Name
Whether you want to build an online store or create an online course you need a domain. A domain gives your business a professional touch. It helps your website build credibility in your industry too.
Also, domains improve Search Engine Optimization (SEO) so your website can get a higher ranking on Google, and domains protect copyrights and trademarks.
- Visit a domain name registrar. These include Namecheap, GoDaddy, and A2 amongst many others. But, we don’t recommend GoDaddy as their UI experience is unsatisfactory. But Namecheap, on the other hand, is excellent!
- Type in the domain name you want. Try to make your domain catchy, concise, and easy for customers to type. You’ll find a list of domains for you to choose from, and then you can advance to the next step.
- Buy the domain. After choosing your domain, buy it. You pay for a domain annually. The price ranges depending on the industry and suffix.
Step Four: Develop a Marketing Strategy for Your Online Store
A successful online store is built on a precise marketing strategy. And your store shouldn’t be any different. Although it can take a lot of time to develop, a marketing strategy will give you a clear direction to market your brand.
Sounds overwhelming? Don’t worry. We’ll guide you the entire way!
What is a marketing strategy?
A marketing strategy is a business’s plan to attract potential customers and convert those customers into sales. Your marketing strategy will revolve around your online store’s value proposition.
For example, if your value proposition is to sell the best quality jeans, you’re going to tailor your marketing efforts to prove why your jeans are the best.
According to Hubspot, businesses who make their marketing a priority experience a positive ROI (Return on Investment). Furthermore, 14% of small businesses fail because of inadequate marketing efforts.
If you want your business to succeed, you need a marketing strategy!
How to develop a marketing strategy?
When thinking about developing a marketing strategy, you need to consider SEO, social media marketing, email marketing, and content marketing.
But to get you started, here are 6 steps to developing a marketing strategy:
- Conduct a SWOT analysis. Doing this will help you identify your businesses’ strengths, weaknesses, opportunities, and threats. This information will reveal where your business needs improvement and where it has the upper hand.
- Nail down your value proposition. What value do your products offer your customers? You need to be crystal clear on your value proposition as your marketing strategy depends on it.
- Establish your marketing objectives. What do you want to achieve in your marketing? Do you want more customers? Higher purchase values? Higher purchase volumes?
- Identify your ideal buyer. Remember that ideal buyer persona template we provided you with earlier? Use that now!
- Analyze the market and your competitors. Assess your competitors and figure out: What’s working for them? What’s not working for them? What aren’t they doing? What do their customers complain most about?
- Establish your ideal marketing methods. You can’t be everywhere. Narrow down the channels your target audience is most active on and avert your marketing efforts in that direction.
Tips for Gaining More Exposure for Your Online Store
- Hold an irresistible discount. This is a short-term solution that works like a charm! Put a popular item on sale and watch your consumers go bananas!
- Host a competition. Everybody enjoys winning, so use that to your leverage and host a competition. You can request participants buy a certain product, refer a friend, or both to enter the contest!
- Reward first-purchases. Encourage customers to support your brand by rewarding them for their first purchases. This is a great way to flaunt your product and give consumers a chance to test your brand. So, in this case, first impressions REALLY count!
- Offer free samples. Studies prove that right now, shopper confidence is pretty low. But free samples are a simple way to install confidence in consumers, as this allows them to try your product before committing to it.
- Start a referral program. Referral marketing works and research confirms that you can expect a 16% increase in profits from referred customers. There is a bit of magic that goes into referral marketing, but it works.
- Build an email list. Building an email list is essential throughout owning an online store. An email list allows you to market to consumers who haven’t bought your products yet and while keeping your current consumers interested.
Step Five: Choose an E-commerce Platform
You need a reliable, advanced E-commerce platform to power your online store. There are tons of platforms in the market, but the main players are: Shopify and WooCommerce. We will cover the pros and cons of each in another post, but here’s the quick and dirty overview (PS, we love WooCommerce!)
Pros of Shopify
- Dedicated customer support
- Easy and clear UI
- Vast choices for themes
- Countless plugins available
- Essential marketing tools
- Built in blogging feature
- Extremely easy to use
Cons of Shopify
- Limited customization if you don’t understand code
- Only ten themes are offered for free
- Exporting blog posts is an extreme hassle
- Additional plugins can be pricey
Pros of WooCommerce
- Features are highly customizable
- Advanced features to grow with your business
- Tons of attractive, responsive, pre-built templates
- Payment processing is seamless
- Configuration demands no coding knowledge
Cons of WooCommerce
- Commonly used platform. So you have to put a lot of effort into making your online store look unique.
Step Six: Make Sure Your Online Store is Easy to Find and Looks Fantastic!
For online stores, aesthetics is everything because your consumers should want to stay and explore your products. 69% of consumers abandon their carts before confirming the purchase.
In other words, less than 40% of your consumers will follow through with a purchase. So, give all your consumers extra buying confidence and encouragement to purchase from your online store.
But there’s a lot more to a well-performing online store than just the aesthetics. Let me explain.
1. Your Online Store Needs to be SEO-Optimized
Organic traffic is when consumers get to your store through a channel that is not paid like social media ads or Google ads.
To drive an insane amount of organic traffic, your online store needs to be SEO-optimized. Why? Because the better your SEO, the more chances you have of ranking first on Google.
Pages that rank first on Google’s search engine results receive 33% more traffic. And more traffic means more sales!
If you’re not experienced in SEO, some freelancers specialize in primarily improving a website’s SEO performance and provide SEO audits.
2.Your Online Store Needs to be Personalized to Your Ideal Buye
Your ideal buyer is the consumer who you want to purchase from your store. To improve the chances of them buying your product, personalize your store to suit your ideal buyer.
For example, bring up a pain point your ideal buyer experiences and how your product is the solution. Or how your ideal buyer can get closer to their personal or professional goals with your product.
The point is so when your ideal buyer lands on your website, they instantly feel like that is where they need to be. And there is no better way to deliver this experience aside from personalizing your online store.
3.Your Online Store Needs Social Proof
Social proof is when businesses use social influence to give their brand more credibility. There are various forms of social proof such as celebrity social proof-when a celebrity promotes a brand’s products.
Don’t worry, I’m not saying you have to get Elon Musk or Beyonce to endorse your brand!
Social proof can also include testimonials from previous clients, an industry expert’s recommendation, or simply a real-time figure of how many customers are buying a brand’s products.
Whichever route is viable for you to execute, definitely do it. 88% of consumers trust user recommendations just as much as personal recommendations, proving that it’s imperative to showcase other people benefiting from your product.
4. Online Store Features to Influence Consumers to Purchase Your Products!
- Ease of use. Consumers prefer websites that respond to simple navigation. 70% of online businesses fail because of bad usability.
- Website speed. Pages that take 5 seconds to load carry an average bounce rate of 38%!
- Mobile-adaptive. Consumers want an online store they can visit on their mobiles as 90% of the 4 billion internet users access the internet via smartphone.
- Pop-ups. Catch your consumers off-guard and market sales or discounts through a pop-up. The average conversion rate for popups is just over 3%.
Step Seven: Configure your Company and Get an SSL Certificate
You’re almost done getting your online store on its feet! It’s time to iron out the legalities and payment information for your online store.
Check out your country’s regulations around digital trade to ensure your method of operation is by the book. If you have trouble finding or understanding this information, be sure to speak to a lawyer.
When starting an online business, you need to consider setting up a business entity. This is essential to consider, as doing this means your business is a separate entity from you. Consequently, you won’t be legally liable for anything that happens to your business. Plus, your personal assets are protected from your business’s liabilities.
Now as for your SSL certificate….
What is an SSL Certificate?
An SSL (Secure Sockets Layer) certificate is a digital certificate supplying your website with authentication and an encrypted connection. Having this certificate ensures the web traffic between your server and the consumer’s browser is protected and cannot be read.
Without an SSL certificate, you risk your and your consumers’ data being stolen! Not to mention that your store legally shouldn’t handle any payments without this certificate.
Where Do You Get an SSL Certificate?
Many web hosting platforms offer SSL certificates. You can find one for free at Let’s Encrypt.
Step Eight: Set-up Payment Methods and Shipping Processes
After sorting out the legalities and your online store is safely secured, you can determine your payment methods and shipping processes.
The 2 Common Payment Options for Your Online Store
- Merchant account and payment gateway: Partner with a bank or merchant services provider so they can accept payments for you and send the money to your account.
- Payment gateway integrations: Integrate payment processing software to your E-commerce store. This will connect your shopping cart to the payment processing network.
To keep your payment methods secure is the SSL certificate. And whichever of the two options you choose, you need to adapt your payment method to suit your audience.
For instance, if 80% of your consumers are in Europe and you’re in America, your payment options need to include what’s convenient for your European customers to buy your product.
Check your shipping settings
Before paying for an E-commerce platform, check what shipping capabilities they offer. Some tools like Squarespace don’t offer printable shipping labels, whereas Shopify, Woocommerce, and Magneto do.
An ideal E-commerce platform would offer you comprehensive shipping management tools while providing convenience to your consumers.
Online Store Shipping and Payment Process Factors to Consider:
- What are your refund and exchange policies?92% of customers say that they would buy a product if the return process is easy!
- Where will you ship too, and what will your policies be around it? Follow the same rule we spoke about earlier regarding the payment process: make it super convenient for your consumers.
- How will you handle payment disputes? You need to establish a professional and fair method of operation to handle payment or order disputes. Always handle this according to your State’s law to protect you and your consumers.
Step Nine: Market Your Online Store
And just like that! Your online store is ready to launch, and the next step is driving consumers through optimized marketing channels.
- Use Social Media AdsSocial media is an enormous network of consumers. Facebook, Pinterest, Instagram, YouTube, Twitter, and Snapchat all offer paid ad campaigns. The significant aspect of social media paid ads is that you control how much you want to spend daily and monthly. The surrounding rules vary between each platform, but business owners can typically expect that system.There are hundreds of ways to optimize your social media strategy. But choosing a platform your audience is most active on and using content that connects with them is a great place to start.
- Create a BlogBlogging is a fantastic way to build up an audience while earning an income. But mind you, it’s not elementary work. There are a lot of different components that go into a successful blog. Think excellent quality content that speaks to your readers. Highly SEO-optimized content that stands a chance to rank on Google. And rich features that prove your value proposition. Don’t expect your blog to grow overnight and constantly improve your blogging strategy. If you aren’t the blogger yourself, outsource a freelancer!
- Market via EmailEarlier, we briefly covered the importance of building an email list. And, fundamentally, for your online business to be successful, you need an email list. Disagree?The Click-through-rate (CTR) stats for email marketing in 2021 is 14.65%, proving that building an email list pays off. To efficiently grow an email list, focus on developing an engaged audience and networking with potential stakeholders.
- Develop a Social Media Marketing Strategy (Aside From Paid Ads)Paid ads are fantastic. But they’re not all you need to focus on for social media marketing. To efficiently build an audience and leverage prospective buyers, you need to engage with your consumers on social media. This includes:
- Posting regularly
- Responding to comments
- Engaging with larger brands and industry experts
Get a social media calendar, find out where your audience hangs out the most and start a social media strategy!
Step Ten: Track, Evaluate, and Improve
Once you’ve launched your online store, you need to analyze how it performs. Doing this will make you aware of whether your marketing strategy works and if your business is making a profit.
The Essential Metrics to Evaluate for Online Stores
- Sales conversion rate (CVR): How many consumers made a purchase?
- Email Opt-ins: How many consumers subscribed to your email list?
- Customer Acquisition Cost (CAC): How much does it cost to gain a new customer?
- Revenue by Traffic Source: How many customers come from previous consumers?
- Average Order Value (AOV): On average, how much do customers spend at your store?
- Shopping Cart Abandonment Rate: How many customers abandon their shopping carts?
- Net Promoter Score (NPS): How satisfied are customers with your brand?
- Customer Lifetime Value (CLV): How much do you earn from a customer over their lifespan with your business
Well done! You’ve reached the end of this ultimate guide to build an online store, and you have what you need to get started.
Amid the invaluable takeaways, it’s essential to recognize the amount of effort and comprehensive planning for online stores. Never rush your process. And instead, aim to have a value proposition unlike any other.
Stay ahead of your analytics and consumer insights to keep your product in demand and secure a loyal customer base.
Aside from the online store marketing methods from above, always look for untapped marketing methods. If you can benefit your customers in a way that your competitors can’t, the future of your business may be brightly lit.
I hope I’ve answered all your questions. Happy online store building!