When NOT to start an online store

Jonathan — Fri, 21 Nov 2008 15:55:04 +0000

Today I was asked by a client how to start an e-commerce store on their website. I’ve shown them the Wordpress e-commerce plugin in the past. Having a brand-new website, they are excited to start doing more with the web and want to start selling online. I wouldn’t mind doing the contract work to get them selling, but first they need to take the time to do a thorough examination of what benefit it will have to their business. I’ve seen a lot of people put up e-commerce stores with the thought that “if I put it up, people will come” which isn’t true. An online store requires constant exposure to search engines, mailing lists, advertising, phone support, tech support, etc. It can become (at least one) full-time job.

If you’re thinking about starting an e-commerce store, the first thing I would do is estimate how many visits to your site would convert to a sale. Say 1 in 10,000 visitors decide to buy something, especially if you’re selling products that are available elsewhere. To generate that one sale, did you have to spend $5,000 ($0.50/Google Adword) in advertising dollars? How many hours of your/employee work did it take on top of that?

As you see, an e-commerce store without a proper strategy will just end-up soaking up time, money, etc. that could be better spent growing a non-e-commerce website into a destination which will be easy to monetize later. My advice is always, if you don’t have a fully-flushed out strategy for making money online, DON’T!

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When NOT to start an online store