Top 5 Questions to ask before launching your E-Commerce business

E-commerce is hot right now and everyone is talking about starting an e-commerce venture. The primary reason is that most people feel that the e-commerce model is simple and easy. In my interactions I get to hear this a lot, ' It's so simple, you just need a website, click photographs of the products, upload them and that's it.'

Well, it's not that easy or simple. Like any new business, it takes a lot of effort, dedication and patience. Convincing a customer to make a purchase from a newly launched website is as easy as making a fussy toddler eat healthy food. In Economics when discussing market dynamics we often come across the term ' ease of entry and exit' i.e. how easy it is for anyone to enter or exit the market. The entry into the e-commerce space is fairly easy. What you need is a domain name, hosting space and voila in minutes you can start your online shop. The challenge comes much later, in sustaining and growing your business.

If you are planning to start your e-commerce venture it is very important that you have the answers to these 5 important questions.

1) Who will design my website?

Your website is your online shop. That's where you display your products and that's where customers come to make the purchase. If it is not attractive or well designed or has technical issues the customers would not make the purchase. With giants like Flipkart and Amazon who sell almost everything under the roof a bad customer experience on your website spells doom. The biggest challenge here is to decide whether to hire the services of a web developer or design it on your own using Shopify, Zencommerce and a host of other tools available in this space.

As someone who entered this industry with zero technical knowledge, our experience with the web developers has not been that great. This industry like e-commerce is still in its nascent stage and comprises of two completely different segments. At one end of the line are the professional website designing companies who would give you great service but their proposition would be costly for someone who is just starting out. On the other end of the line are developers who are ready to offer you their services at reasonable prices but getting your work done from them may prove challenging. The first proposal that they would give you would be so tempting that you would want them to start right away. A few months into it some other costs would get added which were not discussed earlier. If you don't pay them they use their technical expertise to blackmail you. Our first developer changed the admin password even threatened to take our website down from the server because we refused to pay him extra money. Thanks to one of our friends who was from the same field we managed to prevent him from doing any harm.

A popular option these days, especially for people with no technical knowledge, is to use platforms like Shopify, Zencommerce etc which help you in creating and launching your website in a matter of minutes. The biggest advantage of these platforms is that you don't need the help of an IT professional to design your website. These platforms come with pre-designed formats which are easy to use. However, customising these formats may be a little challenging.

Whether you hire a web developer or use these platforms ensure that you have complete ownership over the website's domain name. It's very easy to buy a domain on go daddy and you should not outsource that to anyone.

2) SEO or SMM or SEM

The ribbon has been cut, the pooja has been done, till the first customer walks in the wait is endless. The same holds true for the online businesses as well. As someone who has been a part of this industry for three years attracting the customers to your online shop is more difficult that attracting them to your offline store. Making the online customers aware of your online store is one of the most challenging tasks for an online entrepreneur. Digital Marketing plays a very important role here. Similar to the web designing field there is a dearth of professionals in this segment too. Our first meeting with a digital marketing agency and a bunch of jargons were thrown at us.

'You must try Google Adwords and SMM or social media marketing is very important. My team would help you and you would start getting business from the first month itself.' Impressed with the knowledge we signed on the dotted line, paid through our hard earned money for close to six months and the results were practically zero. Our mistake here was that we believed in everything that was told to us without questioning it. If you are planning to start your e-commerce business be aware of these jargons. SEO, SMM and SEM have their own importance. I am not saying that you should manage everything yourself, that's practically impossible. Be aware of what these things are. There are several resources available online that teach you the basics. At least you will be able to track and question the digital marketing agency on what they are doing and the results that you are getting.

3) How do I manage Deliveries?

Logistics is one of the most important aspects of an e-commerce business. Once the customer places an order on the website he/she wants that the product should reach him fast and without any in-transit damage. There are a host of logistics companies in India but it is important to choose wisely. Two most important concerns that need to be addressed here are customer returns and in transit damage. We have dealt with a host of logistics companies and the way most of the pickup boys handle the packages is crazy. We have seen them playing Frisbee with the boxes , pressing and beating them to make them fit into their bags and even walking over them , and all this right in front of our eyes. Here packaging plays an important role.

For most of the e-commerce companies, logistics is outsourced so it is difficult to exercise control over them. However, professional companies like FedEx and Bluedart handle logistics far better than others. They have proper systems in place and the package can be tracked in real time. Plus their handling is much better. This reduces the risk of late deliveries and breakages. Due to the services they offer their rates are a tad higher than other companies. The question here is whether to choose service or cost?

4) Handling Customer Issues

‘Jo dikhta hai wo bikta hai’, is a saying that is completely applicable to the online business. If your website is attractive, if the product photographs are good and the correct digital marketing strategy is being followed sales would happen. The biggest challenge here is ensuring that the customer perceives the product in the same way that you wanted him to. It is very important to have the right photographs and the right product details on the website. Despite that customers might raise issues.

We deal in handicrafts and since the articles are handcrafted sometimes minor design variations occur. We have had to pacify customers who felt that the smile of the idol was less in reality as compared to the photographs. Since it's a virtual market space and customers get to see the product only after delivery, issues may crop up from time to time. In India people also have the habit of ordering products online and then not taking delivery. As a thumb rule when your sales increase the percentage of returns also go up. What you need to monitor is the percentage of customer returns. If the customers are not happy with the products and that percentage is increasing it’s an alarming sign.

5) Follower or Leader

This I feel is the most important question that needs to be answered. Whether you want to follow the herd or craft your own path. So many e-commerce portals are being launched every single day and a lot of them want to be the next Flipkart or Amazon. We get calls from e-commerce companies every other day who are following the same business model. Aspirations are good but somewhere that individuality or uniqueness is being lost. Before launching your business you need to be clear about your goals, what you want to achieve and how you want to achieve it.

E-commerce is a dynamic field. In India, since it is still in its nascent stage there is a lot of opportunity for growth. But, like any business venture it requires hard work, patience and perseverance. Happy Sweating!