What every e-commerce website owner should know about running an successful online business.

The essential elements of an e-commerce initiative. What every e-commerce website owner should know about running an successful online business.

It still surprises me how many people don’t treat their e-commerce enterprise as an investment rather than a cost. They approach the whole project based on finding the lowest bidder for each service or product. But e-commerce projects should be approached from a more thoughtful perspective rather than just price/ cost. You need partners, more than low cost vendors.

Any good investor will tell you that you need to evaluate a business not only on its cost / expenditure but also on the value it will generates in the future and how robust it is to weather the setbacks any business inevitably encounters.

So here’s my list of things every owner planning or running an e-commerce venture should know:

1. Your supply chain is more important than your website design. Don’t spend excessive time on the website. Even an ordinary website will also do if your delivery setup is strong.

No matter how swanky and feature packed your e-commerce site is, if you don’t deliver you’re dead.
No matter how swanky and feature packed your e-commerce site is, if you don’t deliver you’re dead. I have known owners who have agonized for days on the site design, carefully planning and tweaking each pixel but have neglected their supply change. On the day of the launch and on subsequent days there is complete chaos with lots of disgruntled customers.

Yes, a beautiful website is great to have but I shall take a beautifully setup delivery / order fulfillment system over the beautiful website any day. In fact a fantastically designed site raises the hopes of great service from and you’d better deliver at that level.

2. Measure everything. There are a surprising number of items that can be measured and improved across the e-commerce website.

Most e-commerce site owners will be content to measure the number of visitors to their site and the turnover from the sales. These are necessary parameters to give you an idea of current performance but will not tell you how to improve in the future. I recommend e-commerce website owners to at least try and measure the following:

Time spent by visitors on site.
Bounce Rate – visitors leaving the site without visiting another page.
Most commonly taken path by visitors on the site.
Do a comparison analysis on which products are viewed more than others and why.
Cycle the products highlighted on the homepage and check which ones work best.
Do A/B splits on product names to see if that improves sales.
Analyze for losers in your product portfolio and replace them with new ones.
Look for drop points. Pages from which large number of visitors leave the site without ordering. Create funnels which will guide visitors to important pages.
Study abandoned shopping cart patterns. Visitors sometimes abandon the cart even after adding a few items to them. Try to figure out why.
Analyze orders to find price points which make the most sales. Adjust your product portfolio to hit these points more often.
There are many more which you can find by using a bit of imagination and common sense. But the thumb rule should be to measure everything that can help you improve performance and should lead to tangible action points.

3. Be prepared for technical glitches, server outages, credit card gateway failures and a myriad of other unforeseen technology related problems.

Many of these like server outages and credit card gateway failures will be out of your hands but you must be ready to explain and assuage customer concerns
An e-commerce website is a set of technologies working synchronously to give your visitor the shopping experience. But even with the best technology and robust software things can go wrong. You must have contingency plans when technical glitches occur.

Many of these like server outages and credit card gateway failures will be out of your hands but you must be ready to explain and assuage customer concerns regarding the problems. Be honest and don’t try to cover up. Customers will appreciate the honesty.

Make sure your hosting company takes regular backups of your data and ensure you have a copy of your database as well.

Always have a strong backup internet connection in your office in case your primary one goes down. You need to be able to access the internet at all times. Flying blind is not an option.

4. Ensure that your website has adequate information to address all the customer’s needs. Everything should be well documented on your site.

Make sure you have up-to-date privacy policy, terms and conditions and legal documents on your site.
Documentation on your site starts with your product descriptions which should be sufficiently detailed to give your customer a good idea about each product.

Your delivery and returns policy is one of the most important documents on your site. Make sure you clearly state the terms of delivery, what happens when goods are damaged, what your liability on each product is and other important information. This information must be a part of your company policy and strictly enforced.

Make sure you have up-to-date privacy policy, terms and conditions and legal documents on your site. Make sure you have read and know these documents. Copy pasting from other sites and changing the company name to yours is lazy and a bad idea. If possible consult a lawyer to draft them. This investment will pay off during disputes.

If your products are complicated then provide detailed FAQs to help answer the customer’s doubts and help him/her decide. Above all provide clear instructions on how customers can approach you for issues, complaints or suggestions.

5. Build in interactivity with the customer into the sites functioning. Ensure customer participation at a basic level.

This is something that must be done at a planning level. Build in interactive features into the site to help customers participate with you on a regular basis. Some suggestions for doing this are:

Add a rating system to each product on your site to allow customers to express then contentment. Get to the bottom of products which get consistent low rating.
Provide a function for visitors / customers to recommend a product to other people. This will help spread the word about a good product.
Send customers discount coupons for subsequent orders by email. Usually a code they can enter when placing their next order.
Send a feedback mail to the customer a few days after the order is placed to asking for his/her experience of the product. Reward customers who give feedback with gifts or discounts.
If your product is time based or of a fixed quantity then send them a friendly reminder to renew / refill a few days before they are likely to run out of it.
Send subscribed customers regular newsletters and product information. Make sure there is a way for customers to opt out of this service. Follow anti-spam rules.
There are lots of other innovative ways to build in more interactivity. The idea is for the customer to remain aware of your service as times goes by.

6. Address every customer issue and complaint on a war footing. This should be one of your top priorities.

Do not leave this function to junior staff. An apology is strongest when it comes from the top management.
Although this a no brainer, it is surprising how many e-commerce websites neglect customer issues or respond slowly to them. An issue or complaint can be a great opportunity to show the customer your commitment and values. Do not leave this function to junior staff. An apology is strongest when it comes from the top management. Once resolved thank the customer for their patience with a gift or a good discount on future purchases.

Record each issue and measure the frequency with which it occurs. Some issues are indicative of a system failure. Address such issues immediately but don’t bureaucratize the procedure. Use the website’s technology advantage to build in further systemic improvement.

7. Get a reliable technology / digital marketing partner for the venture. Trust me, you will need them. Running an e-commerce business is not for the faint hearted.

If you have been with me till now you must have realized that running an e-commerce site is no joke. If you really want to succeed you will need help. The kind of help that comes with experience in dealing with e-commerce ventures. Low cost vendors might be able to get your site running cheaply but you need long term partners who will guide you through the ups and down of the business life cycle.

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