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5 Things to Watch Out for When Starting an E-Commerce Store

by Sean Ogle | Last Updated: May 21, 2012

ecommerce tipsOver the last few years of doing this whole online thing, I’ve talked to hundreds of people who have considered starting or have started an ecommerce niche site.

It’s so easy to see it as an easy way to make money, build an asset, and really cash in on the power and global reach of the internet.

The reality?

It’s not nearly as easy as everyone makes it out to be. Sure anyone can throw up a site with some stuff for sale, but how do you actually get people to show up on the site?  How do you handle logistics and fulfillment, especially if your supplier is halfway across the world? How do you even know if you have a good market or not?

These are all questions that both myself and many others have faced over the last few years.

I’ve worked on over a dozen different niche and affiliate sites over the last two years, with varying degrees of success.

Want to get into building your own affiliate sites? We’ve got tons of posts on it, check a few of them out.

I’ve worked on sites that are killing it in their niche and bringing in six figures a month. I’ve worked on affiliate sites that bring in $2500 monthly with little to no maintenance. I’ve also worked on a fair number of sites that go absolutely nowhere, and simply drain both time and financial resources.

Ecommerce stores can be an excellent business to go into, if you do it the right way, and take the time to learn how to do it properly.  If you’re looking for a get rich quick scheme however, you should head elsewhere.

Today we’re going to look at 5 ecommerce tips to really consider and be careful of while you’re starting with your site.

1) Take your current idea –>niche down

I’m sure you have a ton of fantastic ideas that you believe are going to kill it the minute you throw up your store.  I’ve got news for you, the chances are there are hundreds of other people that are thinking the same thing and are already doing it.

One of the last e-commerce stores I worked on was selling tablet cases.  Seems like a great market right?  We could sell products for iPads, Kindles, Galaxies etc. While it’s a huge market that’s continually growing and evolving, our approach was too broad.

This market is very competitive, and saturated.  If we wanted to succeed in this market, we should have niched down WAY more.  Rather than focusing on multiple cases for multiple products, we should have focused simply on selling the very best case for, say, the Kindle Fire.

The Fire was about 2 months from release when we were working hard on the site.  If we’d spent all our time marketing that, which didn’t have much competition at the time, rather than going after a very difficult iPad market – we would have seen a lot more success.

If you want to be successful with e-commerce, niche down your current idea. Click to Tweet

2) Test before you invest

Have you ever started a new site or project, threw a bunch of time and money into it and only to find that no one cared? I’m pretty sure most of us have been in some variation of that situation before.

This is an easy problem to solve.  Before you go crazy with your new site, test it to see if:

  1. There’s interest in your product or niche
  2. Your offer converts

So how do you do this?  Start with a blog.

My friend Simon Stock had a company selling surfboard racks. He knew very little about the surfboard rack industry, but he was willing to learn.  He setup a WordPress blog in an afternoon, and spent the next week writing about racks and some of the products on the market.  He then had some Amazon affiliate links he pointed people to in each article and in the sidebar.

Within a few weeks he was starting to see some organic traffic from the search engines, and not long after that he started getting some affiliate sales through Amazon.

Learn more about using Amazon FBA to build your own ecommerce shop.

He sped up the testing by throwing a little money out for Google ads.

Not only did he learn that there was a market for his products, but he learned a ton about his industry in the process, thus making him an a bit of an expert on surfboard racks.

From there he setup his own site and build relationships with the major manufacturers. He used his test site as a lead funnel to the new site, and has become one of the biggest resellers of surfboard racks on the internet.

We go into a lot more detail about this strategy in the E-Commerce Location Rebel Academy blueprint.

Are you SURE there’s a market for your new product or site? No? Test. Share this.

3) Manufacturing in Asia WILL be a headache

There’s a good chance that as your site grows and you get sick of sharing the proceeds from your sales with the company making your products, that you’ll want to manufacture your own products.

After all, by now you’re the expert and know what your customers want more than anyone else, right?

Sourcing in places like China and Vietnam can be really appealing.  It’s cheap, and there are all sorts of companies setup to help make things as easy as possible for you.

Not to mention, you can get anything made there, as I recently learned at the Canton Fair.  There are a lot of problems with doing business in Asia however:

  1. At some point the language barrier, will be an issue
  2. Quality control is a nightmare
  3. Asians approach business differently than westerners

If you’re serious about doing manufacturing in Asia, you should really consider partnering with someone you trust who speaks the local language and is on the ground and can work with the factories on a regular basis to ensure you’re getting the product you ordered.

In the past, a friend of mine was sourcing Zorb balls from China. You know those giant plastic balls that you roll down hills in.  He had quality control nightmares after receiving multiple requests for refunds or exchanges for faulty balls.

That falls back on you if you don’t have someone in place to work on it.

If you’re serious about going this route, you should get serious about planning a trip to the country you want to do business in. Go to the factory, be prepared to spend some cash on samples, and also ready to make an investment to meet their minimum order quantities.

And don’t expect your visit to China to be a total cake walk either:

There are a ton of advantages to sourcing in Asia, but headaches will be a common occurrence. Tweet it.

4) Don’t underestimate the power of SEO (both positive and negative)

One of the most common questions that comes up when helping people start blogs is “How much time should I spend on SEO?“.

The usual answer when it comes to blogs, is not very much.  There are more important things to deal with, and if your blog is good, the rankings will come.

That said, E-commerce is a whole different ball game.

While social sharing and such can certainly be beneficial, there’s a good chance that your SEO strategies are going to make up the bulk of your traffic (and income).

My most successful niche sites usually saw about 85-90% of their traffic from search engines.

That said, there’s a right and a wrong way to do SEO.  Do it right and you’ll be rewarded with thousands of adoring visitors and customers.  Do it wrong? You’ll piss off Google and be deep-sixed into oblivion, never to be heard from again.

You think I’m joking? Just ask the thousands of webmasters who fell of the top pages of Google with the latest Penguin update.  Not that all of them did anything wrong, that’s a whole different post, but you get the idea.

If you’re serious about e-commerce put a high quality SEO program in place.  What does this look like? Ideally:

All of this seem really basic? That’s because it is.  Not only that, it’s effective.

Low level link spam has seen better days, while Google has far from perfected its defenses against it, and there are still ways to game the system, following the advice above will future proof you and give you much better results over the long term.

5) Put careful thought into your platform

There are all sorts of options for building E-commerce stores – this is part of the appeal.  No longer do you have to have a legion of developers and fat bank accounts to develop a basic e-commerce site.  No, now all you need is a little bit of time and patience with which to learn how your system of choice works.

However, deciding how to go about it can be one of the biggest problems you face.  Magento? Shopify? OSCommerce? Volusion? Hell these days you can even make WordPress work as a perfectly functional e-commerce solution.

That said, once you choose your platform, be willing to stick to it, because migrating will produce 10 times the headaches.

Believe me, I know this from experience. While I was in Bali last year I spent hours and hours at cafes migrating our tablet case site from OSCommerce to Shopify.  That’s when you just pay someone the hundred bucks to do it for you, and call it good.

All of that said, I highly recommend using Shopify for your e-commerce stores if you’re just starting out.  It’s extremely simple to use and is only $30/month for a basic account.

Many of the others are more expensive, more technical, and probably are overkill for what you want anyway.

That said, do your research.  If you’re looking to grow to the point where you’re marketing thousands of products, and you do have some technical experience or a technical partner, some of the other options may hold more appeal.

And if you’re simply doing a basic affiliate site? Do yourself a favor and stick with WordPress.  Even if you want to get into elaborate datafeed marketing and such, there’s plugins for that now, and your life will generally just be easier if you stick with WordPress.

Jun is the Co-Founder of an internet startup that revolutionizes customer loyalty at restaurants and retail stores. In his entrepreneurial experience, Jun has sold 2 internet companies and lead social media technology campaigns for Sephora, Whole Foods Market, Levi’s, LG, and Activision.  His lifestyle business is Minted Republic, an online boutique that he runs with his girlfriend.

i.e. He knows what he’s talking about.

Photo Credit: Fosforix

Sean Ogle is the Founder of Location Rebel where he has spent the last 12+ years teaching people how to build online businesses that give them the freedom to do more of the things they like to do in life. When he's not in the coffee shops of Portland, or the beaches of Bali, he's probably sneaking into some other high-class establishment where he most certainly doesn't belong.
Build a Lifestyle Business Giving You Freedom You've Always Wanted

Our 6-part course gives you a strategy to start right now. Put control of your life back in your hands. Sign up below and let’s do this together.

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