Added by on 2012-09-19

Believe it or not, the first thing you must do when creating an online store is decide what exactly you are going to sell. The products you are currently selling, and the amount, will help you determine the type of commerce model you will need.

Not all products sell well on the Internet. Consider the tactile and visual nature of your products. Consumers like to touch and see certain products before they buy. How many times, for example, have you seen people walking through a clothing store and feeling the fabric of the different items of clothing before deciding on a purchase?!

So you need to consider how well these products will transfer across in the electronic environment.

Find your niche market

The most successful online stores are the ones that have a niche market to which they cater exclusively. For a small business, this is even more important as it is difficult to compete with the “big boys” unless you are selling something they can’t!

Think of the products you sell in your offline store and put yourself in your customers’ shoes. Would you buy that product online and why?

Then consider your range of products. If you sell a variety of different products, is it worthwhile putting every product online? If your inventory is fairly large, it may be cost-prohibitive to put every item you sell online plus you may be limited by space as to the number of products you use. In this case, choose your best sellers. This gives you the opportunity to test your best products first before venturing into other products which may not sell.

Your other option is to provide a printable catalogue in addition to online products. This lets customers know your range of products without having to spend a lot of money putting them all online. Instead, you can create a product catalogue in Word or something similar, and then provide a PDF format.

You can then add a link to this PDF on your site, telling customers they can print off your full product line with just a click of a button. Customers can then call you for delivery options and product availability for items which are not in your online store.

Conduct online research

Before making the final decision on your products, do your own online research about your competition. Check the types of products they have online and the prices they are charging. Remember, you need to distinguish yourself from your competition, so if your competitor only has one model of a particular product, and you have three, you should put all three models online.

Once you have decided what products you want to sell, you should categorise them. The categories can be whatever suits your particular business. For instance, if you are a clothing retailer, your categories can be broken down into the types of clothing – trousers, shirts, jumpers etc

The number of categories and products will give you an outline of the complexity of your store. The more categories you have (and any sub categories under that), the more complex your store will be.

For instance, if you are only selling five products in each of three categories, you can probably create a store using tables. A large variety of categories and products (such as Myerdirect) means you will undoubtedly need to create a store which has a shopping cart so multiple pages can be accessed and items added with ease.

Choosing your commerce model

Once you have identified the products you want to sell, you must decide on the type of commerce model you will use which best suits your style of business.

The number of commerce models available has changed as the Internet has evolved. No longer are businesses making money just from the traditional retail model. There are a number of other models you can consider and these will largely depend on the type of business you are in.

The traditional retail model

This model is, as its name suggests, the long-established method of doing business on the Internet. Effectively, with this model, you are purely selling products, such as through an online catalogue. You don’t have to have a physical retail store to use this model. You do, however, have to have a large enough number of products to sell. With a large range of products, you will need a site able to handle multiple categories and products. You should look at dedicated e-commerce software for your site.

The combination store model

This model combines the offline world with the online. Basically, you are integrating your offline retail store with your online store. The integration needs to be as seamless as possible and the online presence should highlight the physical store. Primarily, this model exists for existing retailers to take advantage of the Internet and to grow their business. This is an ideal model for small businesses and can take advantage of any name recognition your company has managed to build up. The site can then have information about the offline store as well as feature products online.

In addition to the traditional retail models, there are a number of other e-commerce options you can consider, such as:

The cut price model
You can gain market share simply by making sure your prices are lower than any competitors. The drawback is you will have to sell large quantities to cover your costs. This is because of the lower profit margins. Due to the nature of the Internet, someone else could come along and charge even less than you do. This will effectively put you out of business unless you lower your prices, or devise a new way to sell your products.

Because you need to sell large volumes through this site, you will need a site able to handle large amounts of traffic, and an easy-to-use commerce module similar to that in the traditional retail model.

The in-stock advantage model
This model takes advantage of the fact that you have certain niche products in-stock that the “big boys” may not. While you may not be price competitive, you offer instead something which could be more valuable i.e. fast service and faster delivery! Say, for instance, you sell jazz CDs. Generally you can’t compete with the bigger CD stores for range of product, but you can as far as jazz CDs are concerned. Perhaps a jazz lover wants a particular CD, which would take a couple of weeks to arrive if ordered from a larger CD distributor. However, if he buys it from you, because you specialise in jazz there is a good chance you will have it in stock, and be able to deliver it the next day. This model has the advantage of immediacy. However, your success will depend on making sure you maintain good stocks of your items, and can deliver when you say you will.

The content driven model
Content can make or break a Web site. Content can also play a big role in this commerce model. The idea is good content will lead to more visitors and more visitors will lead to more sales. In this model, the commerce aspect is very low key and the content takes precedence.

This can be a very effective model, especially if you are in a saturated market. Adding content, or “value” will help distinguish you from your competitors.

The type of model you have chosen will drive how you will set up your store. Obviously, if you have chosen the content-driven model, you will need more features than just e-commerce whereas a retail model, such as myerdirect, will need a very strong commerce site.



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