Here are the 18 things you need to know before starting an eCommerce business.
1. Know Your Customer Intimately
If everyone can use your product or service, no one will. Buyer behaviors have changed significantly since 2020. Be specific about who you are chasing for business.
Marketing budgets are a terrible thing to waste. Study your web analytics, survey your customers to learn their needs, and segment them to serve them better with your content.
2. Clearly Communicate Your Offer
This sounds simple, but it isn’t. Every day there is a war for customers. If you cannot effectively communicate your offer and the unique value you bring to the marketplace, your business will struggle. You must find a way to stand out; product descriptions are key.
3. Have a Sales System
Do you have a way to drive leads consistently? Online businesses need a sales process too. It helps you respond to inquiries, manage customers, and leverage technology to efficiently track sales, inventory, and profits. Using Live Chat, Chatbots, a CRM, and a fulfillment system make managing your sales opportunities seamless.
4. Have a Follow-up System
Most people won’t buy the first time they are exposed to your brand. Do you have a sales funnel in place or a way to nurture leads and build a relationship to close sales? Email, retargeting, phone calls are just a few ways to close sales.
Do you have a system in place to follow-up after the sale to get a review or a repeat order?
5. Know How to Drive Traffic
Since your website is your #1 sales tool, it’s critical to drive traffic there. From social media, long-tail keywords, irresistible headlines, On-page SEO, quality content, blogging, and online ads, there are dozens of ways to lead a potential customer to your website. Do you have an effective website that loads quickly on any device?
To drive traffic, it’s all about getting visible online.
6. It’s Harder Than You Think
Every excited business owner thinks that it’s going to be easier than it actually is to run an eCommerce business. If you sell on your website or pick a marketplace, you’ve got to know how to drive traffic and close sales. You can be up and selling in hours, and so can your competition. Imagine how hard you think it’s going to be and then expect it to be five times harder than that. Make sure you have enough personal motivation to push through it and a budget to cover your mistakes. But be good to yourself.
You will make mistakes; just make sure that you learn the lesson the first time. You never lose in business; you either win or you learn.
7. You’ll Wear a Lot of Hats
As an entrepreneur, you are essentially a jack of all trades. You’ll do 10-12 jobs, and some on the same day. The saying, chief, cook, and bottle washer is real. Once you put your shingle out saying your open for business, you have to drive sales, update social media posts, take pictures of merchandise, be the inventory manager, take care of shipping, customer service and keep an eye on the finances.
8. Isolation is Rough
It’s lonely working for yourself. When you’re running your own company, you need to build a network of other business owners to have a support system. You need to talk to other people that understand how you feel as the boss.
Find yourself a Facebook group to get support and an accountability partner so that you can have someone to challenge your thinking and keep you sane.
9. Identify Your Niche
In my early days in business, I wasted a lot of time and money chasing all kinds of different customers. Don’t pursue just any customer. Focus on a specific niche target customer and be known for something. If everyone can use your product or service, no one will. It’s much more profitable to learn everything you can about your specific niche audience so you can become an expert in solving their problem.
Figure out how to become their “go-to” resource for your customer.
10. Be Smart with Money
When business owners start making money, they often get overconfident. You will have good months and not so good months in terms of sales. Don’t spend money on things they don’t need. When there is little or no revenue coming in, you will burn through cash fast. Even essential expenses like online advertising can be wasteful if you do not properly measure your ROI.
Be wise! Ask yourself why three times before spending your finances.
11. Product Descriptions Really Matter
Nearly 90% of online shoppers characterize detailed product descriptions as being extremely important in their purchasing decisions. This is a critical segment of customer engagement because your customers don’t get the opportunity to examine the product physically. What you add to the description has the power to make or break your conversion rate.
12. Use Your Lawyer and Accountant as Advisors
One of the biggest mistakes that new business owners make is that they only call a lawyer when there’s a problem or an accountant at tax time. Don’t do that. You need to find a lawyer who specializes in working with small businesses and get in the habit of running important things by this person.
You also need to engage your accountant or bookkeeper monthly to reconcile the books, prepare your annual budget or develop a tax strategy to minimize your business taxes. Otherwise, you just have a tax preparer.
13. Insurance and Taxes are Important
If you are doing business as a sole proprietor and fail to take out insurance for your business, you could find yourself in a lot of trouble if things go wrong. Even as a home-based business, you could be personally liable for your business equipment or inventory in case of a fire without business insurance. Certainly, if there’s a malfunction of any of the products you sell, you could be personally liable.
Taxes are a part of life for a business owner. Ecommerce businesses pay taxes, too. A good rule of thumb is saving 22%-30% of your gross revenue to put towards your federal and state taxes.
14. Online Reviews are Important Social Proof
I don’t buy anything without reading the reviews. You need recommendations from happy customers to attract more customers. Getting reviews for your small business is vital if you want to stand out in search engine results pages and directory listing sites. Do your best to resolve any issues customers may report in a review, and if things go well, ask them to update the record. You can also post a response that contains an apology and express your desire to help them have a better future experience.
15. Content is Critical in Ecommerce
It’s okay to start your eCommerce business with one amazing product, and over time you’ll become the obvious choice to work with if you have a content strategy. For example, let’s say you sell a product that grows hair. Then you create a Blog, YouTube Channel, or a weekly podcast all about Natural Hair Care. That will position you as the expert on the subject. Over time, you’ll build a brand and a following.
Consistent content drives sales online. When you focus on one product or service for a specific audience and educate and entertain them with helpful content, new clients will come to find you.
16. Watch Industry Trends
As a business owner, you must pay attention to trends and technological advances that are on the horizon that will change your business operations or industry. If you want to position your business as a tastemaker, you know the latest fashion trends. If you sell educational tools, you want to know the latest trends on how kids learn and retain information or testing tools.
Protect your business but understanding your client’s future needs.
17. Learn to Friend-raise
Relationships are critical in business. You must learn to become fast friends with anyone. People do business with people they like, know and trust. When you are selling online, you may not know all your customers personally, but you need to develop a brand to feel like they know you and understand what they are going through. It’s important for you to network online and offline.
Nothing beats building relationships in real life. And it’s best to start making connections 12-months before launching your business if you can.
18. Focus on Hitting Targets Instead of Goalsetting
Goalsetting is a great way to create excuses, instead set targets for your online business. Targets have timelines. That’s because you need targets that are SMART:
- Specific
- Measurable
- Attainable
- Realistic
- Time Sensitive
Your ability to focus on your key targets will help you build a successful business.
It’s important to remember that selling online takes time. It’s unlikely that your eCommerce business will become an overnight sensation. Instead, it will take hard work, dedication, and constant tweaks to your landing pages, website, and online ads before you start driving your ideal sales targets. Build a solid foundation to generate recurring revenue over time. Pace yourself.