E-commerce sales are projected to reach a worth of $7.4 trillion by 2025, indicating that the online shopping boom is yet to reach its peak.
The average shopper makes around 19 online transactions per year, and there are between 12 and 24 million e-commerce stores selling everything from fashion to household items and equipment.
As the e-commerce landscape expands, established retailers and emerging entrepreneurs capitalize on this upward trajectory by diversifying their offerings and optimizing their digital strategies.
A significant factor driving this growth is the increasing adoption of advanced technologies, such as artificial intelligence, augmented reality, and chatbots, revolutionizing the online shopping experience. Additionally, the proliferation of mobile devices and the rise of social media platforms have given consumers the convenience of shopping at their fingertips, contributing to the industry's sustained growth.
In response, e-commerce platforms are constantly evolving to meet the ever-changing demands of consumers, offering personalized shopping experiences, seamless payment options, and swift delivery services.
As the e-commerce industry continues to flourish, it is expected to play an even more prominent role in shaping the global economy and transforming how we shop.
If you are interested in setting up your online shop and want to stand out from your competition, then make sure you harness the power of the following strategies for success.
Demonstrate Your Company’s Value
Study your competition well and determine the defining elements that give your business an edge. Perform a competitive analysis of top players in your sector, mapping out their strengths, weaknesses, opportunities, and threats (a SWOT analysis). Try to identify the benefits you are offering that your competitors aren’t. If your products and services are practically alike, work out new offerings to give your company an edge. Remember that most online customers compare before they buy. Therefore, your unique products or services should be highlighted and easily spotted when clients click on your site.
Choosing the Right Legal Structure
Many small businesses start as sole proprietorships, owing to the simplicity involved. In some jurisdictions, you can operate a business under your name without even taking out a registered business license. As your business grows, however, you should consider setting up an LLC. Doing so will ensure you aren’t personally liable for your company’s debts. In addition to choosing the right structure, you should also ensure that you have all your legal requirements down pat—including your tax, labor law, industry-specific norms, and the receipt of legal mail. All states have registered agents that can receive legal mail on your behalf. This can be handy if you frequently travel or work from another state from the one you are registered in. For instance, although states like California are seen as lands of opportunity, you may decide to work from a state with cheaper rents. In this case, a California Registered Agent (or a registered agent in your state of incorporation) can receive all pertinent information on your behalf. A friend or family member can serve as your LLC’s registered agent.
Keeping Costs Down
When you first launch your business, keeping costs down is vital, so you can afford to spend on marketing efforts, a dynamic website, and other essentials. Aim to reduce product returns by ensuring your clients know what they purchase before clicking “add to cart.” For instance, if you are in the fashion sector, provide precise and transparent means of measurement so clients buy the right size for them. You can also extend the period provided for returns to give customers more time to decide if they want to keep items rather than forcing them to return goods quickly. Finally, look at where your revenue is coming from. For instance, if most of your returns come from customers who have clicked on your site from influencers’ affiliate links, consider cooling off on this type of marketing and investing more in avenues that bring in loyal clients. Negotiating with suppliers to obtain the best deal possible would be best. For instance, you might arrange a freight-free agreement to lower your costs significantly.
Pay Less for Credit Card Processing
Try to lower the fees related to your processor. The latter decides on aspects such as your annual and online reporting fees, and they can choose to waive them. Expand your payment methods if your processor is unwilling to lower their rates. Doing so will attract more customers since many prefer payment systems like PayPal, Apple Pay, or Venmo to traditional credit cards. Review the refund policy of each payment method to ensure you get the best deal on aspects such as refunds. If you've selected Shopify as your commerce platform, you're in luck, as they have Shopify Payments backed right in.
Invest in a Trustworthy Accountant
Your accountant will help you crunch numbers to decide whether to go for innovations, changes, or additions to your product or service range. Entrepreneurs often get excited about new ideas and take risks without knowing how this will affect the bottom line. Use software such as Excel to see the numbers and how proposed changes will impact them. Please get to know your figures inside-out to give your investors quick, educated answers and increase their confidence in you.
E-commerce is thriving, and if you have a product or service that can effectively be delivered or provided online, then the sky’s the limit – so long as you adopt critical strategies for success. Research your market well to ensure you offer something nobody else does. Keep costs down and ensure all legal requirements are fulfilled. Finally, take calculated risks and aim to innovate, but crunch your numbers first with a trusted accountant and CFO.