Printer friendly version (PDF)Electronic Storefronts
Electronic storefronts are web–based services that allow you to create
virtual stores, post a catalog of products, calculate shipping fees, and accept
online payments with virtually no programming experience. Using only your keyboard
and browser, you can point–and–click your way to a slick–looking,
revenue–generating website in minutes.
This does not mean putting together simplistic prefab designs and a few megabytes
of web storage. There are successful free and subscription services that offer
flexible design options along with reporting and marketing tools that enable
you to establish repeat customers and generate new ones.
Key Advantages
- Cost – A leading technology vendor in Canada stated
that a small business can expect to pay approximately $5 million for an e–commerce
website. Today, virtually all electronic storefronts can be set up for no
more than a few hundred dollars a month; some are even offered for free.
- Ease of use – No special hardware,
software, or computer training is required. An electronic storefront can
be set up using only your browser, mouse, and keyboard.
- Highly customizable – These storefronts enable you
to select from among dozens of predefined design choices, add content, adjust
colors and text, and insert pictures of catalogue items. Pages can be viewed
as you create them, and drop–down menus can be easily added so that
customers can choose a particular size, color, style, and other pertinent
information.
- Surprisingly robust bundle of e–services –These
include secure on–line transactions, site submission tools, and surveys
for attracting business. Most storefronts have inventory manager functions
which allow you to keep track of what you have in stock. Some storefronts
have invoice export tools which allow you to send customer purchase information
directly into other accounting packages.
- Greater marketing clout and more traffic – As a
member of storefront community, you may participate in seasonal promotions
or frequent–buyer programs, offer customers e–coupons for merchandise,
and tap storefront portal traffic.
- Ideal for retail products, and business–to–consumer
transactions.
Key Disadvantages
- You or your employees must do the work yourself.
- Launching the site is just the start. The real work is
maintaining, updating and marketing the site consistently.
- To accept payments online, you will still need a credit card processing
service,or your own merchant account. These can
be acquired through your own bank, or from a bank designated by the storefront
service.
- While you may accept online payments for free, there is an additional cost
to process credit card orders in real time (around $100 CAN/month plus 50
cents CAN per transaction).
- Storefronts can be tricky to navigate, and awkward to
use – especially for web novices.
- Steep learning curve can be expected.
- Your unique online identity may be compromised. On some
storefronts, you are not so much an individual business, as an "affiliate" or "associate," of
a particular e–commerce "community."
- Not designed for wholesale or business–to–business
transactions as such, although can still be designed to work with
B2B applications according to your needs.
- Not designed specifically for service companies’ transactions. Although,
again, steps can be taken for compatibility depending on what you require.
- Most electronic storefronts are based in US. However,
the number in Canada is steadily increasing.
- Limited usability. Some US electronic storefronts may
have geographic restrictions imposed which can mean limited usability for
Canadian vendors.
- Storefront prices and features change constantly. For
latest and best information, consult each storefront directly.
What Are The Major Categories of Electronic Storefronts?
There are at least five major categories of electronic storefronts:
- Free brochure storefronts.
- Free e–commerce storefronts.
- Subscription e–commerce storefronts.
- E–Auction storefronts.
Free Brochure Storefronts
Provide free promotional or brochure web sites, although no e–commerce
functions are provided.
Free e–Commerce Storefronts
No–charge, browser–based e–commerce site creators.
Electronic Store Front Tips: Free vs. Subscription
Advertising
Free: Some free storefront services make their money by placing
ads in your store. Not only can these ads be distracting to your customers,
you usually have no control over what products are advertised, so you may end
up carrying ads for one of your competitors.
Subscription: Little or no advertising.
Hidden Costs
Free: Most free storefront services only offer a limited
number of services free and then charge for what they define as "value
added services." Example: online credit card processing. Sometimes they'll
insist that you use their merchant account provider whose rates may not be
the most competitive. In some cases, your "free" store may end up
costing you more than a subscription store.
Subscription: Fees are generally upfront, although some hidden
costs.
Terms and Conditions
Free: The Terms of Service for free e–commerce providers
tend to be fairly restrictive. For example, they may prohibit you from placing
links on your site to any other website. The provider may also have the authority
to close your store at any time without giving you any reason, notice or compensation.
Subscription: Less restrictive terms and conditions.
Functionality
Free: While impressive, often lack detailed reporting systems,
or customer personalization features.
Subscription: More robust functionality. For example: subscription
sites offer the ability to run a storewide sale. Can create a members–only
area for top customers. Notify customers automatically when back–ordered
items come in. Can save customer order histories, track order shipments online,
and create profiles.
Customization
Free: Limited customization features.
Subscription: Higher ease of customization, but not necessarily
easier to use than free storefronts.
URL
Free: Name of storefront service usually part of the URL.
Subscription: Unique URL usually available.
Inventory
Free: While rules vary, first 100 products usually free.
Subscription: In general, the bigger your catalogue, the
greater the cost.
Business Stage
Free: Ideal for new companies and looking for an easy way
to go online without a major financial outlay.
Subscription: Typically used by larger, more established
companies that are committed to e–commerce for the long haul, and need
more powerful service, support, and promotional tools.
Subscription e–Commerce Storefronts
Monthly fee–based, browser–operated, e–commerce site creators.
E–Auction Storefronts
Create your own free auction site or community where you can sell goods to
the highest bidder.
Electronic Storefront Tips
Comparison of electronic storefront services:
You may accept credit cards without a merchant account using a credit card
processing service. For a percentage of the sale, they will handle all online
billing functions from collecting sales taxes to responding to billing inquiries.
Examples:
Take adequate measures to prevent fraud. If you ship expensive
items, be sure to use a service that provides written proof of delivery such
as Priority Courier, Xpresspost or Skypack. There will always be customers
who claim their package never arrived.
Look professional. Your job online is to inspire a potential
buyer's confidence and convince them that it is safe, easy, and more convenient
to buy something on your website. Take the time to correct all the grammar
and spelling mistakes, and compare your site with those run by your competitors.
Provide accurate product information. Make sure your customers
know what they are buying before they place an order. If you sell books, indicate
how many pages they have. If you sell videos, give the running times. In short,
don't surprise your customers. The more they know about your products, the
less likely they will be disappointed, and the less likely they are to return
them.
Answer customer email messages within one working day. If
people don't get quick responses they will turn to your online competition – they’re
only one click away.
Focus on customer service. While the popularity of e–commerce
is increasing, many people still have doubts about shopping online. On your
site, provide a phone number for suggestions or complaints, and send an e–mail
confirming receipt of an order. By doing all this, you show visitors that their
satisfaction is your top priority.
Decide which category of electronic storefront is most appropriate
for your business. Is it the free brochure, free e–commerce,
subscription e–commerce, e–publishing, or e–auction storefront
category? This will focus your thinking and more clearly define how best
to take your business online.
Research all the electronic storefronts in a specific category. Whether
you're interested in a free brochure or an e–auction storefront, carefully
scan all the leading services noted in the handout. Find the specific e–commerce
solution that's right for you, and get your business up and running on the
web.
Take responsibility. Although the storefronts make it easy
to go online, you must still work hard to make your online business a success.
Build an attractive site. Advertise and promote your store. Communicate with
your customers. Provide great customer service. If you are willing to put in
the time, energy, and resources required to make your online store a success,
the financial rewards will follow.
|
