No question – ecommerce has not only been a booming industry since Covid. According to forecasts by the market research institute Statista, around 2.37 trillion euros will be turned over worldwide in B2C online ecommerce alone in 2023. So, that you know all the risks and imponderables when setting up an online shop, we have summarized the most important advantages and disadvantages of ecommerce for you in this guide.
Ecommerce – in these sectors you make the most sales with online shops
Are you planning to open a new online shop or would you like to expand your stationary range with a focus on ecommerce? Then you should give some basic thought to the project in advance. The good news is that a well-managed online shop is almost always successful, especially in the B2C segment.
However, many factors decide the weal or woe of your company: In addition to a technically flawless concept and the right brand strategy, along with search engine optimization, (paid) online advertising, and the promotion of your shop via social media, your product range is a decisive factor. Certain products are very popular in online shops, while other items turn out to be slow sellers.
With the following products, you are definitely on the safe side:
| product category | Turnover in German online trade 2019 |
|---|---|
| Clothing, fashion, fashion | 14.26 billion euros |
| Electronics & Telecommunications | 13.23 billion euros |
| Furniture, fixtures, and housewares | 10.92 billion euros |
| Leisure & hobby | 8.9 billion euros |
| Computer, Software & Co. | 6.0 billion euros |
| Grocery, drugstore & pet supplies | 4.9 billion euros |
Furniture and food web shops in particular are booming in 2020. However, it remains to be seen whether the development is a definitive rethinking of the consumer or whether the trend is purely seasonal and has only picked up speed due to Covid-19. That’s why you shouldn’t rely on fast-moving market developments when selecting the range for your online ecommerce project, but rather serve the demand for sought-after top sellers.
By the way: If you don’t necessarily want to go with the flow and want to focus on classic product ranges, you can also find numerous inspirations on the Internet on how to set up a shop for niche and zeitgeist products. It is best to use Google Trends for your research or be inspired by various lifestyle blogs. In this way, you are sure to find the right product for an individual and contemporary online shop with a sales guarantee.
This is how you arm yourself as a stationary retailer against digital competition
It goes without saying that nowadays it is possible without any problems to relocating one’s entire business to the World Wide Web. However, if you are currently running a shop and Amazon and Co. are nibbling on your sales, then there is nothing wrong with accepting the digital challenge and being part of online ecommerce.
With your own online shop, you can largely compensate for the monetary slump caused by digital competition. So before you give up the David versus Goliath battle, meet the challenges and become a part of the digital retail community.
So you can perfectly use the synergies of stationary and virtual trade. Because your distribution chains, marketing, and accounting already exist, getting onto the World Wide Web is relatively effortless for you and your business. The advantages are apparent:
1. You open up new customer groups beyond the local restrictions.
2. You facilitate bilateral communication between you and potential buyers.
3. You have new and exciting opportunities to market your products online.
4. You can sell your goods anywhere and anytime.
5. You can generate new customers with effective online marketing.
6. You have a new tool for positioning your brand at hand.
7. You can save costs by optimizing work processes.
8. If you wish, you can conduct consultations online and thus address customers worldwide.
9. You can also respond to customer requests outside of your business hours, e.g. via chat, e-mail, or video conference.
10. You ensure a relaxed shopping experience with your online ecommerce and thus promote customer loyalty and satisfaction.
As an ecommerce retailer, do I also have to fear disadvantages?
Of course, not everything that glitters is gold when it comes to online ecommerce either. Before you can achieve initial success with your online shop, you have a lot of work to do. However, it is very exciting and instructive to deal with the current trends as well as the technical and legal requirements of online shops.
You should not underestimate the following points when planning:
- The effort of “opening” and ongoing maintenance of your shop
- Legal basis about your online business (copyright, liability for content, terms, and conditions, revocation, the conclusion of the contract, trademark law, protection of minors, imprint, etc.)
- Data protection (GDPR, sharing of customer data, tracking visitors via Facebook, etc., cookie policy, IP address handling, etc.)
- Securing the virtual marketplace against hacker attacks, and viruses (firewalls, passwords, SSL encryption, etc.)
- Implementation of popular payment options (PayPal, credit card, invoice, etc.)
- Expenses for shipping processes
From a commercial point of view, there are also some aspects that you should consider in your ecommerce project: For example, remember that the return rate in online retail is relatively high. To keep customers as satisfied as possible, you should therefore consider effective returns management. Keep in mind that packing packages for shipping and processing returns take additional time.
Apart from that, you should calculate your prices in such a way that you remain competitive despite the included postage costs. Large online retailers usually ship their goods free of charge, which is putting increasing pressure on smaller shops.
So try not only to sell based on price but to set yourself apart from the competition with other USPs (Unique Selling Propositions). This can e.g. B. an excellent online consultation via video chat or the offer of extraordinary goods that cannot be bought anywhere else.
If you succeed in transferring the advantages of stationary retail to your web business, you create a stress-free shopping experience for your customers and can thus generate additional sales. This is partly because satisfied buyers are “repeat offenders” and like to use the same online shop several times.
With exclusive offers, newsletters including discount vouchers, and unusual marketing campaigns on the social web, you can get your customers to visit your online offer regularly. What’s more: by sending out e-mail newsletters and marketing offers for your local business, you can even attract online shoppers from the area to your stationery store. So you kill two birds with one stone.
Modern tools ensure time savings and less stress in ecommerce
As already mentioned, your webshop should meet a whole range of legal requirements and be protected against hacker attacks and viruses. Major challenges are lurking here, especially when it comes to implementing common payment systems. It is not uncommon for customers to drop out at the last moment of the ordering process because a desired payment method is not available or because too much personal data is requested. You should definitely integrate the most popular payment methods into your ecommerce.
are particularly in demand here
- paying by invoice (27.9%),
- PayPal (20,5 %),
- direct debit (19.7%),
- credit card (10.7%) and
- hire purchase or financing (5.4%).
In contrast to stationary trade, online retailers bear a greater accounting risk here. In particular, payment by invoice and hire purchase may cause a loss of income. In addition, when offering these payment methods, an effective dunning process is a prerequisite for you actually receiving the money for the goods shipped sooner or later.
This all sounds like a lot of work and theory. The good news is that modern shop systems – which you can often buy online via a subscription model – have automatically integrated many of the criteria mentioned.
The most popular providers include:
- STRATO Webshop,
- Shopify,
- WooCommerce,
- jimdo,
- Weebly und
- ALZURA Shop.
You will also find some open-source shop systems on the Internet, the basic version of which is even available free of charge without product support. Various plugins for WordPress complete the offer for web shops.
A good shop system should offer the possibility to integrate SEO and marketing activities, allow different designs, and be technically up-to-date. Of course, this includes SSL encryption for secure online purchases.
The requirements of the General Data Protection Regulation (GDPR) must also be met, as non-compliance can result in high fines. Finally, a flawless imprint ensures that your customers trust you. In addition, complete provider identification ensures increased warning security.
Mobile First: How to take advantage of increasing smartphone use for your ecommerce
Especially with ecommerce, you should keep up with the times to offer your customers a modern and simple shopping experience. The smartphone has long trumped the stationary desktop PC as the most popular end device.
In 2018, only around 30 percent of all online purchases in Germany were made with a smartphone or tablet. A year later it was already 58 percent. This makes mobile commerce the fastest-growing sector in retail.
You should take advantage of this fact and optimize your online shop for mobile devices. With a so-called responsive design, the web shop is then displayed technically flawlessly on PCs as well as on mobile phones and tablets.
Fortunately, you don’t necessarily have to complete an apprenticeship as a computer scientist. Modern shop systems offer numerous setting options with which a responsive design is automatically generated. In the event of a user request, the shop system recognizes the respective end device, and the page is then made available to the customer dynamically and in real-time.
Nevertheless, there are still a few adjustments that you should tweak manually: Distracting elements should be reduced to a minimum in the smartphone view of your shop. This is how you make the purchasing process simple and transparent for your customers. In addition, it makes sense to do without overly long product descriptions and text deserts and instead with
- the table,
- lists,
- keywords
- bullet points and
- graphics
to work. On the smartphone display, content is often only roughly scanned by the user. Ideally, a well-made product presentation burns itself into the mind of the interested party within fractions of a second. And because the cell phone is generally used for content that is easy to consume, you can take advantage of it.
With these digital marketing strategies, you push your ecommerce
Of course, to make your ecommerce known, you also need a suitable marketing strategy. There are some clear differences here compared to classic marketing. In the best case, you use all the essential options in a very targeted manner to guide potential customers directly to your webshop.
This works, for example, with SEA-paid ads that are displayed to the (smartphone) user with a Google search query. These are also scanned by the customer in no time at all and perceived within a tenth of a second. By clicking on the ad, the buyer is then directed to your webshop, which causes costs in the cent or euro range, depending on the keyword. Marketing experts call this type of new customer acquisition “PPC” or “pay-per-click”.
If you don’t want to squander a large advertising budget for your online shop at first, you can of course also use inexpensive alternatives to “PPC”. Search engine optimization also plays an important role in the “mobile first” area.
With so-called content marketing, you optimize the content on your website for search engines and users alike. With keywords – i.e. keywords that are often centered on Google & Co. – you can attract prospective customers to your digital shop in a very targeted manner. Expert web shop operators use technical SEO to reduce the loading time of the website, making it more attractive for Google and customers.
Another fantastic source of traffic is the social web. If you present your web shop on social media, e.g. B. with a Facebook fan page or video tutorials on YouTube, you achieve a significant increase in reach and also offer your customers an additional digital service. You can also present your products in style on the Pinterest online pinboard. A creative hashtag for Twitter completes your social media marketing.
Conclusion: With ecommerce, the advantages for retailers and customers outweigh the disadvantages
Even if setting up your own ecommerce takes a lot of time and work: in the end, the advantages for providers and consumers outweigh the disadvantages. Especially if you already run a stationary shop, a web shop can generate additional sales and draw the attention of new customer groups to your business.
Meanwhile, your customers benefit from the expanded range of services and the ability to access your product range 24/7. This makes online ecommerce a win-win situation for both parties.
And even if there are already web shops like the sand by the sea: With a clever idea and a well-thought-out marketing strategy, you will definitely find the right niche in the thicket of other providers. And because the purchasing behavior of consumers is increasingly oriented towards the World Wide Web, it would be almost negligent not to react to the rethinking of your groups of buyers.
What are you waiting for? Start your ecommerce now and take advantage of the digital shopping world. We wish you every success with your online project!