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Opening for business: How to set up your first online store

CNET@Work: First, you need products to sell. Next up: Where and how are you going to sell them? Here are the factors to consider when launching your digital storefront.

Natalie Gagliordi Staff Writer, ZDNet
6 min read

With technology increasingly intertwined with all aspects of business, CNET@Work can help you -- prosumers to small businesses with fewer than five employees -- get started.

So you've decided you want to start your own e-commerce business, but you're probably asking yourself, "Now what?" Assuming you already know what products you're going to sell, the next thing you'll need to figure out is where and how you're going to sell them.

The good news: Compared to the process of creating or sourcing products and doing competitive research, the steps required to launch an online store are relatively straightforward.

Read more: The best website builders for 2019

Pick your platform

Selecting which platform you'll use to build your online store is a significant decision. You're laying a foundation: All the other tools -- from your credit card processor to your marketing strategy -- will be built upon this one decision.

Right out of the gate you should determine how much time you plan to invest in your store. Is it your full-time job, or a sideline? This will be a key factor in choosing a platform that matches not only your business goals but also your technical know-how.

Most e-commerce platforms are user-friendly enough that even novice online entrepreneurs can create a professional-looking store with minimal time and effort. Nevertheless, it's important to choose a platform that caters to your particular skill level while still being on par with the trends in commerce. What's the most effective way to get this kind of information? Ask around.

"Talk to other e-commerce business owners about what they're using, and then make sure you try it out yourself," said Casandra Campbell, content marketing lead at Shopify.

Other important factors to consider when weighing commerce platforms are differences in price, feature sets, support services and integrations to third-party software tools.

"If a business owner would like to do more than just sell, like having a blog, newsletter or allow people to book services, they should decide that early so it can be built into the online store from the beginning," said David Schwartz, VP of e-commerce at Wix.com.

There are dozens, if not hundreds, of companies that offer e-commerce services, but as far as full-fledged platform providers go, the main players are Shopify, Bigcommerce, Wix, Squarespace, GoDaddy and Etsy.

If you're hesitant about launching a full-fledged storefront, but still want to sell online, consider the marketplaces of Amazon and eBay. These come with an established customer base and built-in commerce features for things like customer service, shipping and fulfillment that will allow you to start small and incrementally build up your online presence.

Remember, these companies are eager for your business and most have representatives at the ready to answer your questions.

Know your customers

As a digital storefront owner, the people who will spend money on your site are your top priority, and you'll want to know everything you can about them. Based on the products you're selling, try to paint a picture of your ideal customer, then consider what you need to do draw them to your site and keep them there long enough to make a purchase.

"This will help you achieve differentiation through pricing, unique merchandising, expert curation and content, and other tactics," said Jimmy Duvall, chief product officer for Bigcommerce. "Simply put, before you start building a store, you should ask yourself why someone would shop there."

These factors can also influence your choice of an e-commerce platform provider and impact the design and functionality of your online store. For instance, the e-commerce handicrafts marketplace Etsy isn't the largest platform for independent sellers, but it does attract a certain kind of shopper.

"Etsy is not only well known, but also established on the basis of having handmade and vintage items," said Morgan Kumpfmiller, owner of American Dreamers Renovations in Pittsburgh. "I launched my furniture store on Etsy because the site was attracting customers specifically looking for the type of merchandise that I was selling."

Design your site

Most business owners have a specific website aesthetic or design in mind when setting out to launch an online business. But for those coming in with a blank slate, a good approach is to identify existing websites that appeal to you as a consumer and take note of the design characteristics you want to emulate.

Additionally, spend some time thinking about the context of your buyer: Are they casually browsing from their mobile phone or carefully price shopping from their desktop? Chances are you'll need to prepare for both scenarios, which means designing on a platform that is mobile responsive.

"The way your site looks is critical for establishing trust and attracting customers," said Campbell. "It's important to have a clean and simple design that also needs to be responsive so it can be accessed on any device."

In terms of trust building, GoDaddy's commerce head Tania Rojas recommends highlighting your business address and phone number so buyers know they're dealing with a legitimate store owner. You can also have a dedicated section for customer testimonials or a personal blurb about you, the store owner, and why you started your business.

Product photography is another area to focus on. Pictures play a big role in e-commerce because they're the primary representation of what someone's buying. Always take high quality pictures of your products and use lifestyle photography where it's appropriate, so your customers can see how products look in context.

Plan your marketing strategy

Receiving the first order is a big moment for any online business, but customers have to actually visit the website before that can happen.

"We see customers who think that as soon as they launch their store they're going to get sales," said Rojas. "What they don't realize is that to get sales, they need to execute on a marketing strategy."

Most online stores use a combination of social media, SEO optimization and email marketing in order to drive traffic. As you grow, see what works and capitalize on that. If you notice you garner more sales from emails than social media, reconfigure your focus.

You can also do some test marketing before scaling. Many large advertising platforms, including Google and Facebook, offer free credits to new businesses, providing an opportunity to test campaigns to understand customer acquisition costs and conversion rates.

"If you are a brand new business, you'll need to drive traffic through ads to build an audience," said Duvall. "Most SMBs look to Facebook first given the intense targeting power of Facebook's ad platform."

However, Duvall noted that Facebook advertising can be quite expensive, so it's wise to start small and local by targeting your city first and then home in on purchase behavior data. "This will lower your bid cost and audience reach size and help you to spend less to better understand your audience while driving traffic," he said.

Expect challenges

Don't be discouraged if you encounter some hiccups as you launch your online storefront. Aside from any potential technical challenges, the most common pain points for new businesses revolve around inventory and how to generate sales.

"It can be overwhelming to figure out what you're going to sell, what suppliers you will use and how you will get your products out," said Campbell. "Start small so you can pivot later. Ordering lower quantities allows you to get feedback from customers and change your mind before buying a lot of inventory."

As far as sales go, it's best to prepare yourself for a slow start. The vast majority of consumers who visit an online store do not make a purchase, and on average only around three out of 10 will complete the transaction after placing an item in their cart.

Also, try not to get frustrated if one of your marketing strategies doesn't work -- it can take a bit of tinkering to figure out how to reach the right audience.

"If you've executed on a marketing strategy, and optimized your storefront for conversion, and still aren't seeing any sales, reach out to customers in your target audience and get their feedback," said Rojas. "It's possible it could be a pricing issue, or the product may not really fit the problem or need a customer has."

In the end, the benefits of online selling -- such as the low cost of setup and a global customer reach -- should outweigh any potential challenges. Whatever form of online shop you choose, it's important to maintain a strategic, long-term outlook and a willingness to adjust with the times.