In this article we will cover the basics of commerce and dive into the details of e-commerce with its advantages and disadvantages. We will also discuss the whereabouts of Ecommerce Marketing and which platforms provide this facility other than Amazon and Flipkart.
What is ECommerce?
Commerce means buying and selling goods. Traditional commerce happened face to face and was limited to a geographical location. It was confined to certain business hours generally daytime. With the advent of the internet there came along ECommerce. Electronic buying and selling of a product or a service was called ECommerce. This kind of business happened across the world saving time for both the buyer and seller. This type of business was not restricted to business hours instead could be carried out 24/7. While traditional commerce delivered goods instantly, e-commerce has a scheduled time for the same.
With different electronic channels emerging, E-commerce could also be carried out on mobile named mobile commerce and on social media called social media commerce.
ECommerce can handle multiple modes of payment
Advantages of ECommerce
Provides Global Reach
No intermediaries required
More options from multiple sellers
Lower transaction cost
Disadvantages of ECommerce
Lack of personal touch
Requires an initial setup and marketing cost
Issues related to order fulfillment and returns
Security Concerns like Identity Theft, Malware, Denial of Services
Four Types of ECommerce
B2C - Business sells its products directly to customers.
B2B - Business sells its products to an intermediate buyers like Supermarket or Wholesalers
C2C - Consumer sells to customers like retail, car resale, etc.
C2B - Consumer sells products or service to businesses Eg Social media Influencers who market products for a marketing fee.
Trade Cycle of ECommerce
Ecommerce trade cycle involves 4 stages
Pre Sales - The customer searches for the product or service and then negotiates the price, timeline, and terms.
Execution - Customers place the order, here the payment could be done on delivery or upfront.
Settlement - Invoicing and payment settlement.
After Sales - Involves warranty and after-sales services.
Who can start an Ecommerce Business?
Ecommerce is the fastest growing retail market. Anyone who owns a product or service can decide to sell online. Following steps must be considered to start an e-commerce business.
Selecting the right place to sell is the first step towards success. Depending on the size of business and factors like pricing, scalability, flexibility, and ease of use one can decide between a marketplace and ecommerce platforms.
Processing Payments in a convenient way is much needed and selection of trustworthy payment providers is a crucial step.
Platform you are using must be compatible with other services that will be integrated later. It must be available 24X7, must be catering to different currencies, easy on fees charged, must be reliable, must include reporting facilities, must be easy to use, and above all must provide customer support.
Once you have the business setup, its time to select the right marketing strategy. This is required to attract customers to the online stores. Unlike a brick and mortar where customers may stumble upon your store, online stores must adapt to multiple marketing channels like social media, email, SEM, SEO and others.
Key strengths of the marketplace
While selecting a marketplace or ecommerce platform it is essential to rate its key strengths. Higher the scores better is the platform.
Presentation and Catalogue listing
Merchant Support Service
Fee, Margins, and ROI
Shipping Charges and Mechanism
System Access and Control
Returns and Refunds
Dispute Resolution Process
Must Provide Competitor Analysis
What is Ecommerce Marketing?
Marketing activities performed to create awareness amongst customers on digital platforms about the product or service and lure them into buying the product is called Ecommerce Marketing.
Marketing Strategies needed for Ecommerce
Good Shopping Cart - You can either go for e-commerce marketplace like Amazon and Flipkart or use SaaS platforms like Shopify, or use PaaS platforms like Magento or build your own site with a cart facility.
SEO for product pages - Optimize your product pages with nice photographs, titles, and descriptions. It is always good to have a product video and get reviews for your products.
Schema markup on product pages - If you are going for built-in platforms then this is taken care of, but if you are planning to build your own website then you must see that products belong to categories and have overall schemas which makes it easy to query on the web.
Google Merchant Center - By updating your product info to the merchant center you are making it available on the shopping tab and other services offered by google which means a wider audience.
Running Google Shopping Ads - Setting aside a budget for Google Ads is always an add-on to ROI in the longer run.
Running dynamic retargeting ads through Facebook and Instagram - This is a way to reconnect with the customers who have already interacted with the product or service in some form.
Run Facebook and Instagram ads to reach the targeted audience.
Organic reach through social media is also equally important. It can be expensive to always plan for paid campaigns. Organic reach can limit the expenses of setting up campaigns while getting the required reach.
The use of Automated Email Marketing can help bring in a second sales or get feedback from your customers.
The use of SMS marketing can assist on slow sales days, clearance sales, or end-of-month sales
Using a CRM tool can help build on customer database. This is helpful when you are running your own e-commerce website and need to follow up with existing customers. People who use an ecommerce marketplace may not avail this facility.
Good customer support can enhance the overall sales and work wonders in customer retention and growth.
Ecommerce Platform vs Marketplace
An online marketplace is a website where you can buy and sell goods from different sources or vendors often termed as multi vendor ecommerce marketplace. They provide you with all the necessary setup required to perform transactions, right from displaying the product list to the payment gateway to the delivery of goods except that they don't own the inventory. They usually do have a warehouse so one can store their inventory in their warehouse for a limited duration. Customer support is also made available by these site owners. All in All, you don't have to worry about the initial setup and delivery of goods, and is an easy way to start an online business with a low initial investment for beginners in e-commerce.
In order to grow on these marketplaces, one has to invest some time in optimizing their product listing and set aside a budget for paid promotions like Google Shopping Ads or product search engine ads on these platforms. Check our SEM article for more info.
Top Five Ecommerce Marketplaces
On the other hand eCommerce Platforms are the platforms that allow you to build your own e-commerce website. These platforms can be through cloud computing services or built in-house. The cloud computing services are of three types SaaS based where the software is provided as a service to run an e-commerce business, PaaS based where the hardware and software is provided to set up an e-commerce business and IaaS where infrastructure is provided to you on cloud rest needs to be handled by you. Each has its own pros and cons with limitations in ease of use and flexibility. Generally small businesses use SaaS platforms to setup their business online while the larger ones can choose between PaaS, IaaS or in-house depending on the audience size and need for scalability and flexibility. Following is a list of Saas based e-commerce platforms.
Top Five ECommerce Platforms
While there are certain Paas based platforms out there like Magento or Adobe Commerce, where the business owner may be required to take care of the hardware and software customizations. Hope this article has shed some light on different aspects of ecommerce and its marketing. For more on digital marketing check other articles.