The big step by step guide to start your own professional online store in 2023
Hey there! If you haven't dived into the world of e-commerce yet, it's about time to start your own online store! But, you might be wondering, how do you actually go about setting up an online shop, and what important factors should you keep in mind?
No worries! We've got you covered with our ultimate guide to running an online store. You'll find everything you need to know about online shops, including some handy tips, e-commerce basics, and the legal aspects of online trading.
We're here to help you create your very first online store, so you can kickstart your business with a bang! Let's do this!
- Pros and cons of online stores vs. brick-and-mortar shops
- How online stores and brick-and-mortar shops can work together
- The three ways to set up an online business!
- Understanding the difference between an online store and an e-commerce platform
- Exploring the benefits of starting an online store
- Taking a closer look at the disadvantages of online trading
- Important considerations when starting an online store
- The legal requirements - A handy checklist
- The most important Online store features - Top tips to boost your store's success!
- Online store logistics: Best practices to streamline your operations
- The best e-commerce systems for smaller online shops
The competition in the online market is intense! Numerous online stores are competing for customers' favor, not only on Google. However, fear not! You can surely enter the race with your online store and achieve success! The key is to select the right online store system, and fortunately, there are plenty to choose from.
But don't worry! We'll thoroughly examine the most popular online store systems like Shopify or WooCommerce and demonstrate what truly matters. This way, you can create an exceptional online store and drive successful sales.
Let's take the plunge together!
Pros and cons of online stores vs. brick-and-mortar shops
The retail landscape has undergone a complete transformation: Shopping no longer solely revolves around traditional local stores but has significantly shifted towards online stores.
However, local stores still come with some awesome perks:
- Customers can directly view and try products in the stores before making a purchase. Trying out products remains one of the best incentives for buying!
- They can also seek advice from salespeople and be more effectively convinced about a product.
- Brick-and-mortar stores often have a special atmosphere and provide an experience that online stores cannot replicate in the same way.
So, why should you start an online store?
- You can offer a much wider range of products that customers can order from anywhere.
- Often, products are available at more affordable prices than in brick-and-mortar stores, as the goods don't need to be displayed and can be shipped directly from the warehouse.
- Online trading is open 24/7, allowing your customers to shop conveniently at any time!
How online stores and brick-and-mortar shops can work together
One smart approach is for companies to expand their online presence by establishing an online store alongside their physical shop.
By doing so, they can reach customers who don't live near the local store or might face limitations in visiting in person. Furthermore, businesses can enhance customer loyalty through diverse marketing strategies such as social media campaigns or email advertising.
The brick-and-mortar store and the online store can complement each other seamlessly in their offerings:
For instance, the online store could offer a broader selection of products compared to the local shop, which may focus on showcasing highlights or selling large, bulky items directly. By integrating both channels and promoting cross-referencing, you can significantly boost both your sales and customer satisfaction!
When you run a physical store, expanding into e-commerce allows you to increase your brand awareness by establishing a presence in both the physical and digital realms. Moreover, it provides a safety net, especially during challenging times like pandemics, when your physical store might face temporary closures. By operating both local and online shops, you gain enhanced flexibility, enabling you to respond more effectively to dynamic market changes.
While each sales channel has its own unique advantages and disadvantages, cleverly combining them creates an unbeatable synergy. The crux of the matter lies in comprehending customer needs and implementing tailored strategies to reach them. By doing so, you can achieve remarkable success, both in the online and offline domains!
The 3 ways to set up an online business!
Firstly, you can opt for an online store system that allows you to create your store relatively easily on your own. Some examples of such systems include Shopify, WooCommerce, or PrestaShop.
Alternatively, you have the option to delegate the entire development process to a web agency. They will handle everything for you using platforms like WordPress with WooCommerce, Adobe Commerce, or OpenCart.
Lastly, you can leverage existing e-commerce platforms like Amazon, eBay, or similar ones to sell your products. This approach offers the advantage of tapping into the existing customer base and reach of these platforms.
Understanding the difference between an online store and an e-commerce platform
Both options represent websites with different scales and distinct functions:
An online store is exclusively owned by a single company that sells its products.
You enjoy an unrivaled position on the site - it's all about your brand. You have full control over the development and operation of your online store, allowing you to customize it according to your vision and effectively showcase your brand. Additionally, there are no external parties dictating fees or taking a share from your sales.
However, the onus is on you to attract customers to your online store. You must invest in marketing efforts to extend your store's visibility beyond word-of-mouth referrals. Building brand awareness and driving traffic to your website requires strategic and continuous efforts.
E-commerce platforms like Amazon or Alibaba, on the other hand, offer numerous companies the opportunity to sell their products through their platforms.
The major benefit is that you gain access to a ready-made and efficiently optimized marketplace where you can operate. Your products become discoverable through the platform's general search function, allowing customers to add items from various companies into a single shopping cart, much like shopping in a supermarket. This convenience creates a strong selling point for marketplaces like Amazon or Alibaba.
However, this convenience comes at a cost, as you'll be subject to fees from the respective platform. Additionally, you need to ensure that your products are presented in the best possible way within the framework defined by the e-commerce platforms. Customization options may be visually limited. Moreover, depending on the product category, the competition can be intense, posing challenges that you'll need to navigate.
Bonus Tip: In e-commerce, it is now considered best practice to have both your own online store and sell through Amazon. Many companies generate significantly more revenue there due to the vast reach of the online giant compared to their own online stores.
By the way, you can find all the pros and cons of Amazon's selling platform in this post.
Exploring the benefits of starting an online store
Whether you already operate a brick-and-mortar store or not, these points apply equally to every company:
A physical store typically has limited reach, as it can only attract customers from the local area or nearby regions. However, with an online store, you can break geographical barriers and reach customers from all corners of the world, thus significantly expanding your target audience. Embrace the opportunity to sell your products internationally!
Unlike a physical store with specific opening hours, your online store remains open 24/7, allowing customers to place orders at their convenience. This way, you won't miss out on potential sales outside of regular business hours, ensuring a continuous flow of orders.
Online marketing opens up vast opportunities to promote your store strategically and expand your presence on the internet. Leveraging techniques like SEO (Search Engine Optimization), SEA (Search Engine Advertising), or social media marketing, you can precisely target your desired audience and effectively promote your products. This enhances your visibility and drives more traffic to your online store, increasing your chances of making sales.
No physical presentation
The beauty of online stores lies in their virtual nature, eliminating the need for physical storefronts, shelves, or on-site sales staff to showcase products. Instead, products can be directly dispatched from the warehouse, which not only saves space but also reduces ongoing costs significantly. Moreover, with fewer personnel required compared to a physical store, you can often offer lower product prices, delighting your customers with better deals.
Better customer retention
An online store provides numerous opportunities to personalize your offers for customers, creating a superior shopping experience. By implementing theme-specific promotions or organizing your online shop based on target groups, you can uniquely address individual customer preferences, fostering a sense of loyalty that pays off in the long run.
As products are not physically tryable, many shops and retailers offer an extensive return and cancellation policy. This varies depending on the retailer and state in the US but is often significantly more generous than what is offered by brick-and-mortar stores, which, in turn, attracts and wins over many customers.
Return or exchange options are not legally mandated for physical stores but are based on voluntary offers by the companies!
Taking a closer look at the disadvantages of online trading
The personal contact is missing
In online commerce, the personal contact between you and your customers or employees is absent, which can lead to customers feeling uncertain and deciding not to make a purchase.
No testing possibility
Customers cannot directly test or try on your products on the internet. Therefore, many hesitate before making a purchase and may end up changing their minds.
Since customers cannot physically touch and test the products, there will inevitably be more erroneous purchases and a higher return rate, along with logistical effort and material waste.
A reputable reputation is of great advantage here, as can be seen with e-commerce giants like Amazon, Zalando, or AboutYou. Being present with your products on Amazon, for example, increases customer trust. Selling through various well-known channels adds to your credibility and can lead to greater sales.
Since customers cannot physically touch and test the products, there will inevitably be more erroneous purchases and a higher return rate, along with logistical effort and material waste.
The online market is highly competitive, and companies must compete against numerous competitors. Without a precise plan, entering the world of e-commerce can be challenging.
How to start an online store: Important considerations
You have your business plan ready, your business idea formulated, and you have considered your target audience and the market?
These are distinct and essential topics that you should thoroughly examine before starting an online store!
If so, here are the essential tips to bring your online store idea to life!
The legal requirements - A handy checklist
To start with, you must first define the legal framework. Depending on the country where you operate, there are various legal requirements that you need to consider as an entrepreneur.
These may include:
- Choosing the legal structure,
- Registering your business,
- and possibly trademark registration.
There are also different points that your website or online store must include, according to the applicable local law, such as:
- Cookie banner,
- Terms and conditions (T&C),
- Cancellation and return policy,
- Liability information, and Trademark rights
Registering a business for your online store:
In the United States, there is no unified national registration for businesses. Instead, business registration is done at the state level. Each state has its own laws and regulations for business registration, and the required steps can vary depending on the state.
In general, to register your business, you need to contact the appropriate office or agency responsible for business and corporate filings in the state where you intend to operate. These agencies may have different names, such as "Secretary of State," "Department of Revenue," or "Department of Licensing."
When registering your business, you will typically need to provide information about your company, such as its name, business address, type of entity, and Employer Identification Number (EIN), especially if you have employees or multiple owners.
Additionally, depending on your business's nature and industry, you may also need to apply for licenses or permits. The requirements can vary based on the type of business and may be regulated at the local level as well.
To ensure that you complete all the necessary steps for business registration correctly in your state, I recommend reaching out directly to the appropriate agency or consulting the official website of your state for accurate and up-to-date information.
Analyze your target audience
Before creating an online store, carefully examine your target audience:
- What products can improve the lives of your customers?
- What sets your online store apart from others?
- Who are your potential customers, and what are their needs?
- Which products should you offer online, considering logistics?
- How can you best showcase your products?
A comprehensive analysis of your target audience will help you build your online store successfully and according to a plan. Study what your competitors are doing and take inspiration from them. Create a structure and think about how you can excel!
Checklist: Choose the right Online Store System
There are many different online store systems available in the market, varying in functionality and cost. Based on your business plan, you know best how it should look and what features are needed. Get an overview and select the online store system that best fits your company and your preferences.
The checklist - things to consider with online store systems:
- Webshop creation and simultaneous (domain) hosting with the online store system provider.
- Included templates for website layout and legal texts.
- Customizable design and marketing tools.
- Included standard data protection agreement / cookie banner.
- Integration possibility of external software, such as Google Analytics or ERP systems.
- Pre-integrated payment service options.
Here are some of the most widely used online store systems globally, relied upon by millions of merchants:
An overview of the online shop systems:
- WooCommerce - https://woocommerce.com/
- Shopify - https://www.shopify.com/
- Adobe Commerce (formerly Magento) - https://business.adobe.com/at/products/magento/magento-commerce.html/
- BigCommerce - https://www.bigcommerce.com/
- OpenCart - https://www.opencart.com/
- PrestaShop - https://www.prestashop.com/
- ZenCart - https://www.zen-cart.com/
- osCommerce - https://www.oscommerce.com/
- Wix - https://www.wix.com/
- SquareSpace - https://www.squarespace.com/
The design of your webshop is your calling card. Create a professional and user-friendly design so that your customers can quickly navigate and be fully convinced of your offerings.
Ensure that your online store is optimized for mobile devices, as a large portion of online customers place orders via smartphones!
Invest in Online Marketing:
To ensure that customers find your online store, online marketing is essential. Utilize all available marketing channels, such as Google or social media, to increase your reach and target customers effectively. Invest in high-quality content and optimize your website for search engines to improve your Google search rankings.
Bonus Tip: Word-of-mouth marketing is still the most effective advertising tool! If you sell high-quality products, word will spread, reducing your reliance on online marketing. You can combine both approaches by collaborating with micro-influencers on social media platforms, who can promote your products to their followers.
Offer fast and reliable shipping:
Customers do not want to wait long for their packages! Logistics is a critical factor in online commerce that significantly impacts customer retention and satisfaction.
The best example? Amazon! They have successfully built a positive image through fast delivery and straightforward refunds. Therefore, optimize your logistics processes to ensure they don't become bottlenecks that impede your business. Provide swift and reliable shipping to keep customers happy and coming back for more!
Tip from our logistics experts: If you need assistance with your logistics, you can also outsource it to professional fulfillment providers. Find out when it makes sense for you to do so in this article!
The best e-commerce systems for smaller online shops
A practical example: You have a relatively small business and want to start with a straightforward online store system. No problem! There are various affordable providers that are ideal for small online shops:
Checklist: The most popular online store systems for smaller businesses
To start an online shop with WooCommerce, you first need a regular WordPress website that allows plugins. Technically, the shop system is an "extension" of the website. However, it is a highly practical and affordable solution because both WordPress and WooCommerce are essentially free.
In addition, WooCommerce is a user-friendly, complete online shop system with all the necessary features, making it perfect for e-commerce newcomers.
- However, there is a catch:
While many templates are free, the really cool designs come with a cost.
Your website (or online shop) and domain need to be hosted for a fee, and of course, transaction and shipping costs are incurred. Depending on the extensions you require, there may be additional expenses for newsletter tools, marketing efforts, security plugins, etc.
However, many of these costs are also present with other online shop systems or only included in more expensive monthly packages. With WordPress and WooCommerce, you have the freedom to choose what you need and what you want to pay for.
Shopify deserves special mention here! Its versatility has made it one of the most popular online shop systems worldwide. It is user-friendly and ideal for beginners and small businesses that want to launch a beautiful online shop with all the necessary features without extensive knowledge. Design templates, payment integrations, marketing tools, and more are all included.
The starting price after the free trial period is £25 per month, plus transaction fees if applicable.
In Wix's simple website builder, you can also create and operate a professional online shop. Like all the systems listed here, it offers all the necessary functions, design templates, and numerous integrations. Web hosting, SEO, and marketing tools are also included. The effective drag-and-drop system is highly customizable, allowing you to design your webshop according to your preferences with minimal effort.
Pricing for Wix packages starts at £7.5 per month.
With its user-friendly all-in-one tool, even beginners can't go wrong. SquareSpace offers powerful e-commerce features, numerous integration options, and is remarkably easy to use. A wide selection of creative templates for various purposes and great flexibility make building your online shop a pleasure.
After the free trial period, the Basic E-Commerce package costs about £20 per month.
Hailing from Germany, Jimdo is one of the most beginner-friendly online shop systems and is gaining popularity. It is very easy to use, giving you full freedom in designing your online shop. Jimdo's range of features is also impressive, including many customizable templates, a free photo database, numerous integrations with external tools, and built-in text templates for your legal texts, to name just a few.
Pricing starts at £15 per month and can easily compete with all the online shop systems on the market.
If you have any further questions or would like to discuss your logistics with us, we are more than happy to help.
*Sources: Statista, Tooltester, Smartstore - 2021/22
Blog Article: As of the End of July 2023 - Prices and Offers of Online Stores Can Vary Continuously
Additional Info provided by the offical websites of the shop systems mentioned in this article
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