eCommerce – What You Need to Know

Have you heard about the term “FoMo”? It is the mental strain caused by the fear of missing out on potential opportunities. Did you know that 3 out of 4 internet users buy products online? That’s how important eCommerce has become in its 20 years of existence. If you don’t already have an eCommerce business, we bet you’re probably getting FoMo right now!

SAI Digital is a team of experts dedicated to your eCommerce success in APAC. In this post, we’ll provide an all-encompassing rundown of eCommerce, including steps to start your own eCommerce store, terms to know, and user experience & marketing suggestions to take your eCommerce to the next level. Whether you’re only starting out in digital commerce or have been selling stuff online for a long time already, here is what you need to know to shine in the eCommerce world!

A Brief History of eCommerce

eCommerce is simply selling products and services online. The first ever eCommerce transaction allegedly happened in 1994. Dan Kohn, then 21 years old, sold his friend a Sting CD through the Internet. As one could expect, the history of eCommerce closely follows that of the Internet. Although the World Wide Web exists since 1991, it is the development of the SSL security protocol in 1994 that made online shopping a safe buying option.

The mid-1990s saw the the emergence of marketplaces. The most famous of them all, Amazon, was founded in 1995, same year as Ebay. Jack Ma created Alibaba in 1999. At the time, e-tailers still struggled to build trust amongst consumers. Amazon was the first to display customers’ reviews on each product page. This technique is now called “social proof” and is one of the reasons for Amazon’s early success.

The 2000’s introduced broadband to an increasing part of the population. More people were beginning to have permanent access to the internet; therefore, they had better access to online shopping. This is also the time when payment methods diversified. E-wallets and PayPal became particularly attractive options.

The next decade marks the rise of mobile commerce. Motivated by the surge in smartphone ownership, retailers started considering mobile experience for their websites. In 2015, Google released an algorithm update boosting visibility of mobile-friendly websites. Catering to mobile users was not merely a nice-to-have anymore. It became essential to rank in search engines results pages.

Social shopping has been the last evolution to date. You’ve most probably seen “buy now” buttons in your Facebook feed, or clicked on a product tag on Instagram. Social media is not just a place to discover anymore. It can be used to directly convert your audience via in-app buying.

Terms to know

There are lot of techniques coming into play when selling products online. eCommerce specialists thus developed a jargon that can be bewildering at first. Here is a compilation of eCommerce most-used technical terms curated by our team of experts.

Affiliate marketing is a popular advertising technique for eCommerce websites. Based on revenue sharing, it provides promoters with a portion of the profit made by the retailer. Each promoter, who is often a blogger, has a specific link tying the sales back to them. If someone clicks on the link and buys, the retailer gives back a percentage of the revenue to the promoter. You can find out more on this in Neil Patel’s excellent blog post.

API stands for Application Programming Interface. In short, it allows different software to communicate data and trigger actions. This comes in handy in eCommerce management. For example if you are operating your website with Sitecore Commerce but managing your product catalog with another application, a catalog API will automatically update your website after any catalog change.

KPIs are the daily companions of eCommerce marketers. KPIs are the most relevant performance indicators to track your business goals progress. Here are a few of the most popular web analytics KPIs for eCommerce.

  • Average time on site. How much time do visitors spend in your online store? More time spent on your site means deeper engagement, and thus better chances to convert the visitor into a buyer.
  • Cart abandonment. How many users added products to their cart but ended up leaving your site without buying? A high cart abandonment rate suggests too much friction during the checkout process.
  • Conversion rate. What proportion of visitors buys something on your site? You can calculate this for the whole site, or for specific categories and pages. This can help you locate areas for improvement on your website.
  • Bounce rate. How many users exit your site after viewing only one page? You want visitors to explore and find products they love, so a low rate is better.
  • Traffic sources. Where are your visitors coming from? This will say what traffic sources are most efficient for your business and how you should divide your advertising efforts.

Brick and mortar vs. Pure player. These terms designate two retail models. Brick and mortar retailers sell through a network of physical stores. Pure players are online-only retailers. This opposition is less and less blatant:

Bundling is the marketing technique that offers several products and/or services for sale as a combined package. Instead of selling charcoal, grill and fire starter separately, you would be selling a barbecue package. This is an effective tactic for increasing the average order value.

Call-to-action is the message compelling a prospect to do something upon visiting your webpages. It tells visitors what you want them to do next. That action might be signing up, subscribing, trying out your product, etc. The CTA is an essential piece of text to make your visitors progress down the conversion funnel.

M-commerce refers to buying and selling goods on a smartphone platform. This can happen on a mobile-optimized website, an app, or social media platforms. Digital shoppers are embracing m-commerce: 49% of website traffic comes from mobile devices.

SEO is a crucial part of eCommerce. Search Engine Optimization refers to free techniques to make sure your pages rank high in search engine results pages. In the ruthless world of eCommerce, missing a click means missing a sale. If you are not found and don’t drive traffic, there’s no way you can sell. That’s why SEO is critical to eCommerce websites. We can help you gain visibility: check out our SEO services here.

Steps to start an eCommerce business

Now that you are familiar with the most important eCommerce terms, how do you start your eCommerce business?

For us, there are three main steps involved. You have to set up a solid strategy first, then organize your operations, and finally iterate and scale your business.

Building a strategy to start your online store

Strategy is often overlooked, but it is crucial for eCommerce success. Here are a few points to ponder:

  • What product do you sell? Is it going to be a niche boutique or a general store? Foundr suggests relevant criteria to choose your product: low seasonality, decent sales volume, small and lightweight.
  • Who are you going to sell to? Who is your target? Research your industry carefully. Knowing your customers will make it easier for you to reach them. Without a clear perception of your buyer, you won’t market effectively and will therefore waste resources. You can learn more about this step in this article.
  • Who are your competitors? How are you going to be different?

Operations: make your store a reality

Next step is to make your store a reality. For that you’ll need:

  • A brand identity so your customers can understand who you are and remember you. You need a name that appeals to your target, and a logo of course. We also advise that you determine your brand’s tone early on.
  • A website. Several eCommerce platforms exist to help you build your website and run your business. Some essential functionalities to look for are faceted search, integration of multiple payment and delivery options, registration, vouchers, orders and product management. BigCommerce, SAP Commerce Cloud, Salesforce Commerce Cloud and Sitecore Experience Commerce Cloud are among the most popular eCommerce platforms.

You will learn more about best user experience practices for your eCommerce website as well as shipping strategies later in this article.

Scaling: prepare for growth

Be careful when you grow your brand alongside your eCommerce capabilities. If you grow your brand alone, you might end up with more demand than you can handle, resulting in poor customer experience. 

Keep track of your eCommerce performance by translating your business objectives into measurables indicators. These are your KPIs. They will allow you to keep a close eye on your progress, and o detect the cause of possible issues. Monitoring your business will tell you when to hire help, automate and shop for additional warehouse space.

Benefits of eCommerce for your company

Even if you already have physical stores, taking your business online can have benefits for your company.

Benefits for the vendors

The number one advantage of going online is abolishing traditional frontiers of commerce: with eCommerce, there is no more limit of location and no more restricted shopping hours. Internet users can shop from anywhere, at any time. You can then reach a considerable untapped prospect potential. If you are a small or medium-size company, selling online provides a means to be found by new customers without investing in costly advertising campaigns. Digital technologies also offer an easy way to track consumers’ behaviour, so you can tailor your offers to their specific needs and habits.

Benefits for the customers

Your customers can also expect some advantages from an online retail experience:

  • It makes it easier for them to search through a big catalogue of services and products.
  • They can easily access information that is harder to get in a physical store.
  • Online shopping empowers them to build an order at their own pace, from a few minutes to several days.

If you need more reasons to open your eCommerce business, check out this article. We detail the top 5 reasons to start your eCommerce business.

eCommerce website best UX practices

To get your sales off the ground, you need to ensure great customer experience. This begins with your website’s UX. Here are some best practices.

Your products pages are the first step towards your customers’ conversion. They must be attractive and contain all information your visitors need. Your product copy must anticipate your customers’ interrogations. Photography is often the central focus of your product pages: make sure photos are high quality so your visitors can zoom in. This will prove difficult if you are running a C2C website. If this is the case, communicate best practices to your vendors and consider providing them with photography tools and software.

Navigation is another essential aspect of your on-site customer experience. It can either speed up your visitors’ search, or hinder it. Choose descriptive labels in your navigation (instead of generic terms such as “solutions” or “products”). This will help both your visitors and your search page rankings. If your store offers a large variety of products, mega dropdown menus à la Amazon have proven more efficient than classic dropdown navigation. One last thing: don’t forget to test your menu on a few mobile devices.

The search bar and the result pages are central to the onsite customer experience. Ask yourself along what criteria your customers are selecting products and add corresponding filters. Be mindful of the position of these filters on your page: placing them at the top or on the left hand-side can have an impact. As of the presentation of filters, most retailers present them in one of 4 different ways: display all filters at once, present filter titles only, apply scrolling capability for filters, or truncate them with a “show more” option. If your website offers a wide variety of products, try to think of ways to encourage customers to navigate between results. Pagination is the obvious option, but “load more” buttons and infinite scrolling contribute to a more seamless customer experience.

Your checkout page is where the sales actually happen. You want to make the checkout process as seamless as possible to avoid cart abandonment while ensuring your customers’ payment security. This area of your website is sensitive to the smallest changes, so make sure you test any modification on a portion of your audience before making it live. Your checkout page must strike a balance between speed and reassurance. You want to smooth the process, but not so much that the client loses trust. Here are a few efficient methods to optimize your checkout:

  • Show the checkout flow – reduce visitors’ frustration
  • Include multiple payment options – open the doors for more customers
  • Offer guest checkouts – avoid friction caused by account creation
  • Add upsell opportunities – convince customers to buy even more
  • Draw attention to security and trust seals – give your customers a sense of trust when paying online eCommerce Checkout Page Optimization - trust seals

Finally, test your user experience on mobile. In Asia, m-commerce is king. South Korea, Taiwan, Thailand, Malaysia, China, Hong Kong, and Singapore were ranked in the top 10 countries with the highest m-Commerce penetration rates (Source: We Are Social’s Digital 2018 report). Your website responsiveness can therefore make or break your e-business in this region.

These are just tips, and we’re sure you’ll have other ideas to enhance user experience on your website. But in any case, remember one word: AB testing. Testing on your audience is the only way to know for sure that the changes you are making are beneficial to your business and overall customer experience.

eCommerce best marketing practices

Although search engines give you opportunities to be found without spending any money, there are millions of eCommerce websites out there. Fortunately, marketing can help you drive brand awareness, grow your customer base and boost your sales. There is plenty of marketing techniques you can choose from to propel your sales. Here, we organized eCommerce marketing best practices into the RACE digital marketing framework: Reach, Act, Convert and Engage.

Reach out to your eCommerce audience

First step is Reaching potential customers to make them aware of your offerings. You can build this exposure through:

  • SEO. Outranking eCommerce pundits when starting out is impossible. Instead, focus on less competitive “long-tail keywords” to rank individual products and category pages. Be careful not to duplicate your product title tags: this would result in competing against your own pages for certain keywords. Each of your category pages should also have a category description so they can act as bona fide landing pages.
  • Social networks. Needless to say, social networks are great tools to gain traffic and interact with your audience, so leverage them! Link your social profiles to your storefront, and link your storefront back to your social profiles as well. This will create a virtuous circle of traffic and engagement. You can read more here about the best social media tools for eCommerce.
  • Affiliate marketing. The simplest definition of this is provided by Neil Patel. “Affiliate marketing is the process of earning a commission by promoting other people’s (or company’s) products. You find a product you like, promote it to others and earn a piece of the profit for each sale that you make.” This is a super efficient way to reach out to targeted audiences through a network of bloggers or influencers.

Make your prospects participate

Second step is to trigger your audience to Interact with your brand: your marketing actions should entice them to browse your website and check out your blog. In this separate step, prospects become active. They are not merely subjects to brand exposure anymore. They are actively looking for information. This can translate into sharing social content, viewing product pages, adding to basket, creating an account, or signing up for your newsletter for example. Getting your audience to interact is decisive to your eCommerce success: the longer the visitors stay on your site, the better your chances to sell. Interaction is achieved mainly through content marketing management and lead generation techniques. Think editorial calendar, video marketing and landing pages.

Convert leads into customers

The next step is to Convert those active visitors. Here, you have to get your audience to take the next step and turn them into paying customers. Invest in structured tests to optimize your website and avoid leaking customers! The goal here is also to maximize the shopping cart. You can do so through:

  • Cross-sell: suggest similar or complementary products
  • Upsell: make a time-limited unique offer at checkout
  • Offer advantages upon reaching a certain purchasing amount (free shipping from $100 for example)
  • Bundles: instead of selling meat, coal and grill separately, create a barbecue package
  • Send abandonment emails. Here are some of the best inspirations for such emails.

Convert customers into repeat customers

Finally, marketing should Engage your customers, build loyalty and advocacy. Thrilled customers are key to referral, social media marketing, social proof and repeat sales. Map out your customers touchpoints and deliver personalized, relevant messages via social, email, and web.

If this feels like too much information, just get started by reading about the first things you need to know about eCommerce marketing.

Trends to stay ahead of your competition

eCommerce is evolving, and it is evolving fast! To succeed in eCommerce, it is fundamental to keep ahead of the curve and delight customers. New digital technologies have such power. Here are some of the main trends our experts identified for the following years.

Sensory search

Your typical Google experience is to type something – anything – into a text field. But Text is not the sole starting point anymore. Images and voice can now start a search as well.

The use of smartphones makes images more pervasive in our everyday life, so it makes sense that we would want to search with images. This new technology is still developing but should have big implications on SEO. Image SEO can not be an afterthought anymore. This trend also unlocks huge growth potential for home décor, fashion, and other visually dominant industries. Pinterest already demonstrated this opportunity with their new automated Shop The Look pins.

Voice search is taking up more and more space among total search queries. This trend will definitely impact your SEO as well. Consider including conversational phrases in your keyword strategy and adapt your page content to give a conversation flavour. FAQ sections are a great starting point. Request insights from your customer service department to get a better understanding of your customers’ most common concerns.

Interactive product visualization

It is not just search that is getting a sensory makeover: product visualization is as well. IPV allows the visitor to interact with the product. The most striking example is product customization. When buying a car or a pair of sneakers, the customer is able to choose options and see a rendering of the personalized product in real time. Besides allowing consumers to engage deeply with the product, it also instills a sense of ownership that may boost sales.

Augmented Reality

With eCommerce, until the product is delivered, the customer can not be certain it is the right one for them. Consumers are keen to try out things online. AR empowers them to do just that. This technology is great news for both customers and vendors. Visitors get a close to real-life experience. Retailers enjoy reduced return rate and increased visiting time.

If you want to learn more about AR, we dedicated an entire article to this trend. You can find it here.

B2B Marketplaces

We currently observe a rise in B2B marketplaces that position themselves as a one-stop shop for B2B procurement professionals. For B2B companies, the advantages of launching such a platform are crystal clear. It enables them to serve new customer segments, grow the number of revenue channels, and develop their product assortment.

We identified 12 other trends that will shape future eCommerce here if you want to learn more.

What about B2B eCommerce?

As surprising as it may seem, B2B eCommerce dwarfs B2C figures. In 2017, it already weighed $7.7 trillion, which is more than 3 times the $2.3 trillion of its B2C counterpart. Online retail seems to be shifting to B2B. A good sign is that industry giants such as Alibaba and Amazon are heavily investing in this field.

The fact is, B2B buyers are just as human as you and me. As such, they are looking for the most convenient shopping experience: B2C standards impact B2B expectations. 82% of professional buyers want their business purchasing experience to be the same as when they’re buying for themselves.

This evolution will profit B2B vendors. Customer self-service reduces order process complexity, allowing for higher productivity. Digital technologies also gives businesses the ability to track their customers’ behaviour, gather valuable data on their habits, and adapt their products and marketing strategy accordingly.

Until recently, eCommerce had bad press with B2B companies. Indeed, B2B business’ specificities have to be translated into system capabilities: account specific storefronts, B2B pricing strategies, payment methods, etc.

Today, this is possible under a short implementation time. We designed an accelerator allowing us to customize SAP Commerce for B2B in record times. Contact us for more information.