UK ecommerce is continuing to surge, with ecommerce sales worth £133 billion in 2016 (IMRG). When launching a new online shop yourself, success will often depend on considering key technical needs on a strategic level. The first of these is the fundamental choice of your underlying online shop system. Great benefit can be derived from focusing on essential features. An important decision for new merchants is the choice between the two main types of system: an “open-source” solution or cloud-based “software as a service” option.
What features are really essential?
When selecting the most appropriate online shop system, one question needs to come first: does the software allow you to focus on day-to-day business? Any ongoing updates or hosting issues should ideally be handled by the software vendor on your behalf. In addition, your chosen shop system should certainly deliver on the following key benefits:
The statutory guidelines and requirements governing ecommerce are constantly changing. To avoid inadvertently breaking any laws, you therefore need to ensure that your shop remains up to date on the legal front – select a provider that is not only legally compliant at the time your shop opens, but can also react quickly and reliably to the latest changes in the law by automatically updating your shop as and when required. It can also be useful if the system cooperates with providers of legally compliant templates for pages such as the site ownership details or T&Cs.
Optimisation for mobile devices
Mobile shopping continues to grow at an exponential rate. During the last Christmas retailing season, sales made via smartphones increased by 47 percent compared to the same period a year before. Moreover, this trend is likely to intensify in the future. If you are therefore using a shop system that does not include fully mobile-optimised pages, you should consider changing the system as soon as possible.
Reputable technology partners
Behind the scenes, a complex network of features is required, including payment processing, fulfilment of deliveries and integration with online marketplaces. If your shop system cooperates with reputable partners from those fields (such as PayPal, DHL, Amazon and eBay), you will benefit from two clear advantages. Firstly, large-scale partners of this type can help make your entire order fulfilment process run smoothly. Secondly, your customers will gain confidence in your shop from seeing these household names on your site.
Efficient product search
Once your number of products rises, the need for complex search functions arises. Can customers apply filters to their searches, for example, to make the search results more precise? This feature is often missing or poorly implemented even on some of the larger shopping sites. An optimal search function can, therefore, give your site a significant market advantage and a boost to conversion rates.
Search engine optimisation
Many shop systems include an integrated SEO kit that simplifies and automates the search engine optimisation of your online shop, helping new customers to find your store online. Specialist or niche-product shops, in particular, can derive substantial value from an effective SEO strategy as they tend to have a clear idea of their competition. Look for a shop system equipped with SEO friendly URLs and tags to boost your selling success.
For many sectors, it is essential to be able to set up and offer different product variants. Consider, for example, t-shirts that come in a range of colours and sizes. A shop system that incorporates product variations of this type will, therefore, benefit both merchants and customers. For the retailer, there is no need to set up each t-shirt colour as a separate product, while customers appreciate the straightforward navigation that allows them to switch between the red and black versions of a t-shirt within just one click.
Virtually every online shop starts off as a small-scale operation. Nevertheless, once sales levels increase, most merchants will want to expand their product range and optimise their store. Expansion options are important, as the need to move your shop to another platform – a process that can be tiresome and costly – will almost certainly involve some system downtime. It is, therefore, better to begin by selecting a system that offers future expansion. Integration with a merchandise management (or ERP) system that generates invoices automatically, for instance, can also prove useful as order volumes grow. If you sell via multiple channels (such as a bricks-and-mortar outlet, a mail order catalogue, and the Internet), a system of this type is essential for keeping track of your inventories in a synchronised way.
Ecommerce is becoming an increasingly cross-border activity. Even operators of small-scale shops should consider expansion into foreign markets. To achieve this, however, your site will need to be translated into different languages and in most cases set up to work with other currencies. Many modern shop systems provide support for this internationalisation process, and it is worth considering at the start of all retail projects, no matter how modest.
An Open-source solution, or Software as a Service?
Decisions about the correct system for your shop are further complicated by the differing approaches taken by the various software vendors. In the segment serving the SMB market, two main solutions have come to the fore: “open-source” software, and cloud-based “software as a service” (SaaS). These differ from one another in a number of big ways. Below you can see some of the advantages and disadvantages involved with each option:
For setting up a SaaS shop system, no programming skills are required. Most systems of this type include online wizards – in other words, step-by-step guides – to support the configuration process. These enable merchants to begin trading immediately. In contrast, open-source software first needs to be installed. If the merchant lacks the necessary technical expertise, an agency can be commissioned to carry out the installation, though this will involve additional expense.
SaaS solutions are generally available on a monthly fee basis. In such cases, merchants can usually opt to pay a low rate initially before switching to a higher monthly charge when enhanced capacity, performance levels or additional features are required. Open-source solutions, in contrast, tend to be free of charge and so can appear attractive at first sight. However, the costs of installation, maintenance and expansion can be difficult to calculate and can often turn out to be higher than with SaaS solutions.
In most cases, SaaS solutions incorporate design templates that online retailers can modify in line with their requirements. Design services can be used as an additional option if merchants feel they lack the necessary design skills. The benefit of open-source solutions, on the other hand, lies in their freely available source code, which can be modified as required by shop operators or their agencies. As a result, the online store can be customised with total flexibility to fit the retailer’s precise requirements.
When a new ecommerce operation is launched, it is often difficult to predict what level of growth will result in the future. SaaS users, however, can respond to changing order volumes by moving seamlessly to a higher-level package or even migrating to a customised enterprise solution if their requirements become more complex. Merchants using open-source software will need to plan out the resources needed for their future growth when starting up, or else make their own arrangements for upgrading.
With a SaaS system, the data and software associated with an online shop are stored by the provider, in a secure data centre environment. This keeps the level of risk to a minimum, as data security is handled by the hosting provider and the software is constantly monitored and managed. These aspects can be somewhat problematic with open-source software, as any security vulnerability could be present in the source code and could potentially be exploited by cyber-criminals. If, however, open-source users stay alert and responsive to such risks, they can resolve such vulnerabilities independently.
Users of a software as a service solution usually benefit from regular and free-of-charge updates that are implemented automatically. These ensure that their shops remain compliant with the law, security standards and perform according to the latest version. With open-source systems, the responsibility remains with the shop operators, who therefore need to keep themselves informed of any vital changes and apply the updates to their system themselves.
Modern shop systems provide online retailers with a wide variety of options for integration with external services, such as those provided by payment or logistics partners. With cloud-based SaaS shops, these are either pre-installed or can be obtained separately from an app store. The automatic updating of such add-ons saves merchants a high degree of time and effort. The advantage of open-source solutions, in contrast, lies in the large community of developers who are constantly releasing new applications.
There is no “one-size-fits–all” online shop system that will suit every single ecommerce project.
Decisions in this area depend much more on a merchant’s particular requirements and especially on the size and scope of their online shop. For smaller merchants with a restricted budget and limited technical knowledge, SaaS solutions are generally the best all round option. These can provide you with a complete solution at low cost, allowing you to concentrate fully on your core business. At the same time, the danger of any security or performance risks is kept to a minimum.
Open-source solutions, in contrast, are primarily suited to larger-scale operators with access to the resources needed for installing and maintaining the shop software themselves or contracting an agency to do this. Such retailers often have very specific requirements for their online shop that can be best fulfilled by means of a customised, open-source solution.