How To Create an Online Store

20 Steps to Create an Online Store

This article explains all the steps you need to build a successful online store - information derived after many years of experience. Other articles within this website explore these steps in much greater detail.

1. Choose your Products

This step is much more subtle than it seems. You are here reading this article because you already have product to sell, right? Probably. But your products may not be the right ones, or (much more likely) you are not offering the right mix of products. A very important fact you need to remember is that much like their physical counterparts, online stores get one chance and one chance only. If a user does not LOVE your store they will never come back. That's right - never. They have infinite number of competing stores on the web to choose from, so why would they?

So getting the right mix of products in your store is critically important, and should be done as your very first step. An example: lets say you have teamed up with a fantastic supplier of sport shoes, and decide to open an online store to sell them. Nothing wrong with that idea, but why not offer other sporting goods as well to make your online store well rounded? You might find nobody buys the shoes, but it is the sports bra or socks you sell on the store that actually make you all the money. It takes so long to get agreements with suppliers that it is worthwhile from day one to decide on the range of products you offer, and sell these on the opening day of your store.

2. Choose your audience

Your audience will correspond to the products you offer, and is important because it will shape many of the decisions you make, especially about design and graphics.

If your target audience are teenagers and 20-somethings, your store will be dynamic and chic. If your audience are seniors then the store will need to be conservative, and fonts will need to be larger to allow for older eyes. If you are trying for broad appeal, be careful about the type of images you use; an image that you think is hip and cool may be challenging or even offensive to others. An example is a scantily clad model displaying your clothes; this could be perceived as sexist by some customers.

3. Engage suppliers

Remember this statement: engaging suppliers for your products will be infinitely more painful, and take infinitely longer, than you imagined possible. It's sad but true, and this author has the battle scars to show for it. So select your suppliers, and start engaging with them, at the very beginning of the process. Remember:
  • You are in a catch-22 position that, before your online store is live, you are selling nothing - and hence making no revenue for anyone. Whatever the 'dream' is, at this point in time you are costing time. Your supplier has a business to run, and as you are not (yet) in a position of making money for them, you are very low in their priority of things to react to.
  • Amazingly, a majority (yes majority!) of suppliers seem to care little of increasing their sales. This author has had the experience of providing a proven sales channel with hundreds of thousands of potential customers, at no cost, and at no risk - and still the suppliers would take three weeks to return a single email, if they could be bothered to read it at all. Why some suppliers are uninterested is a universal mystery, but many are operating at peak capacity, and so while they will never say no, they are not particularly enthused at saying yes either - as your online store has the potential to push demand for their products past peak capacity. Leaving you, the owner of the online store, in extreme frustration.
  • Based on the above, and for other reasons, engage more suppliers than you will need. You can always reject them later.
  • Assume the engagement process from start to end, will take up to 4 months or even longer if you are communicating by email, particularly if the supplier is using a different language. Try to engage local suppliers if possible.
  • Determine your pricing structure and business model ahead of time. Better you propose something that they can negotiate on, then the other way around. This makes you look much more professional and gives you an edge.
  • One trick this author wants to share: suppliers are much more likely to want to negotiate with you if you already have your online store up and running, even if it has no products to sell on it yet. In fact, almost no reputable large supplier will deal with you seriously without an online store they can look at and test. This means you need to make an investment upfront - but it is worth it.

4. Research the Competition

The time you spend researching your competition is worth its weight in gold. This will not take a lot of time, but may provide you invaluable (and free!) advice. Remember: your competitors are trading and presumably have some measure of success (though it is impossible to know if a competitor's store is doing well or not, as you can't monitor its physical traffic and sales). When you do your research look for the following things:
  • Differentiation: look for ways to differentiate yourself. If all your competitors have a similiar price, try to position your products at 10% lower. If they charge for shipping, have yours free.
  • What they are doing right: certain things your competition are doing will immediately stand out as great. Use these ideas. For example the way categories in the shop are navigated, the way pictures are displayed, return policies.
  • What they are doing wrong: conversely, your competitors will be doing some things very badly. Don't repeat costly mistakes. For example bad design.
  • Specification: as you go through your competitors' websites, list every feature you see, however tiny and insignificant. The ideal method for this is in a spreadsheet (such as Excel). Later you can go through all the features and determine which ones are mandatory, nice to have, and low priority. As your store actually gets built, you can mark off the features as they are implemented. If you get someone else to build the store for you, you can send them the list of features to quote on as a reference.

5. Work out your budget

You will need to determine a budget for your online store. This budget must be end-to-end - in other words, the entire cost to get it live and trading (excluding product costs). It should consist of two figures: the maximum cost that you actually intend to pay, plus a hidden contingency for changes that you will request on top of your specification (and guaranteed this will happen). A good rule of thumb is for the contingency cost, which you must never communicate to anyone, to be an extra 20% on top of your maximum cost. That way, when (and it is a when, not an if) you exceed your target, you are still within your allocated funding.

If you are thinking of developing your own technology platform from scratch, think again. The cost will start at $100,000. This author has managed an online development project for a major eCommerce company that cost over $1,000,000 to create. However, assuming you don't need to create your own enterprise solution from scratch, the alternatives are infinitely cheaper. They start from free solutions, right through to various shared platforms and pre-made technologies. These are discussed in the solutions page.

In terms of what you want to budget, even if you use a free solution, you will still need to have a domain name, a website to host it, an SSL certificate for security, credit card fees and possibly merchant account gateway fees, depending upon how professional you want your store to be. Bottom line: absolutely minimum is a few hundred dollars, ranging to a limit of five thousand dollars for a very professional store.

6. Get a domain name

Given you've researched the competition, and determined your budget, you are now ready to purchase your domain name. If you change it later, it can cause a lot of problems, including extra costs, links that go nowhere, and most importantly you will need to start again getting search engine ranking. So choose a good domain name and stick to it. The page on finding domain names provides a lot of information and links to tools to help you with that.

7. Determine the store features

An online store is an extremely complex thing. Going to someone and asking them to build you an online store because "they are the expert" is like going to a builder and asking them to build you a "house". Two rooms or six? Fireplaces or not? Marble kitchen? With an online store, you need to know exactly what you want, or you will inevitably be very disappointed; and it may take a lot of money and time to fix. In fact, it may not be fixable at all, as some platforms do not support certain features.

While you are researching your competition, examine other online stores and list all the features they have. Look at as many different stores as you can. You will amazed not only at how many features you find, but at the variations in how a feature can be implemented. For example, with regards to the payment feature, do you want to take credit cards on the website itself or on a separate website? Do you want to take PayPal?

Once you have a list of all possible features, prioritise them. Some will be mandatory, some will be important, and some you will be able to live without. This is important for the next step.

8. Choose the Look and Feel

This is an absolutely critical step that many online store owners omit, mostly because they are not graphic designers. This step is about determining how professional you want your site to look from the perspective of look and feel, usability and navigation. Generally online stores fall under three categories:
  • Amateur: the online store is usable - just - but as soon as you see it, you know that graphic design principles were not considered in building it. Sure, it might do the job. But it is a fact of life that first impressions are critical, and the vast majority of users will not even consider buying from an online store if it looks ugly and is hard to navigate. A store like this is cheap, looks cheap, but gives a nasty impression. If you have a very limited budget, this might be a viable choice, but do it in the full knowledge that many users do not trust, nor use, sites with poor design.
  • Semi-professional: this type of online store has had significant work done to it to make it look good. It is ok, but not brilliant; something about it still hurts the eye. Images are fine, but not ones you would see in a glossy fashion magazine. Fonts are legible, but perhaps slightly too big or small. Colors are a bit off. In other words good, but not brilliant. Users will buy from these sites, but a certain proportion will demand perfection and leave.
  • Beautiful: you immediately know a beautiful online store when you see it. The landing page (the first one you see) has artistic glamour shots, everything reads well, colors are great, fonts are lovely. Near perfection. The downside, of course, is that getting an online store to this level of quality takes time and a bit of extra cost.

9. Choose your level of security

This is one of those decisions that, if not taken carefully, may backfire in a big way. Remember that your store handles financial information, such as credit card numbers, as well as personal information which is stored on a database. If your store ever becomes successful, and you obviously are banking that it will, then it will become a magnet for criminals mining for this sort of information. Think strategically about security, which means long term - and assume that criminals will try to hack your site for information.

Security in the first instance, when you start your store, will have the following elements:
  • Encryption: web pages which communicate confidential information to or from your server, especially financial data such as credit card numbers, require enterprise-strength encryption. This often means that you will need an SSL certificate (which gives you the https:// instead of http://).
  • Vulnerabilities: web pages have all sorts of weird and wonderful security vulnerabilities, associated with various different browsers. It is basically impossible for someone without experience in this to build against the vulnerabilities, so ensure you select a platform which boasts security upfront.
  • Data: ensure that the personal data you collect, such as names and shipping addresses, are stored on databases that are secure.
  • Credit card numbers: by far the most vital bit of security is around credit card numbers. Here you can ensure security by using a gateway into a bank's merchant account (can be very costly), or by having PayPal take the credit card for you. A number of solutions exist - be careful and think this one through carefully, as it can be costly and timely to implement. An extremely important rule to follow is that your website should never store the credit numbers itself. It should take the credit card number on an encrypted page, and pass it directly to the bank or another financial institution via a reputable gateway.

10. Reliability

Again, this one is for the longer term: assume your online store is very successful, with lots of users on the site at any time. If your store goes down, it can be catastrophic for you in two ways: (a) lost revenue, and (b) users who go to your store assume it is down permanently and may never return again, even those that have purchased there before. It is tempting to rent a website on a shared space for $15 a month, put your store on it, and think how clever you have been doing it virtually for free. Remember: you get what you pay for. The platform your select should have distributed redundancy, and have a stated reliability of above 99.9% uptime (though what is stated, and what is provided, are often quite different - blogs can tell you a lot about how reliable a platform or ISP is).

11. Choose your platform

You now have all the information needed to choose the technology platform to build your store, as discussed in the solutions page. There are some very important issues associated with this decision:
  • Finality: once you have made your decision, and work starts, you are pretty much locked in. Reversing it later will almost certainly be too painful to even contemplate. So be very very very careful making the choice.
  • Features: make absolutely sure that the platform you select provides the features, look and feel, security and reliability you want (specially the ones with 'mandatory' next to them). Making compromises is fine, so long as this is done in an informed way, and you are aware of the consequences.
  • Costs: understand the costs, which includes the obvious ones as well as the hidden ones. For example, support (which you will almost certainly require at multiple times) may cost extra, and it may be very expensive.
  • Limitations: all platforms come with limitations, such as bandwidth, data, number of images per product, etc. Be aware of these and what they mean.
  • Scalabiliy: ensure that the platform you use can scale for your online store growing in the future. That's the whole point of the store - to expand!
  • Third party interfaces: this is a critical one and can easily be missed. Ensure that the platform you select supports any third party interfaces you need. For example, some merchant bank accounts require specific gateway interfaces to process credit cards.

12. Choose your payment mechanisms

This is another one of those things that sound trivial, but in fact can be extremely complex in nature. Things to consider:
  • Credit cards: any reputable sites will take credit cards. What types will your store take? Visa and Mastercard are standard, but will you take American Express and Diners as well?
  • Financial institution: if you do take credit cards, how will these be processed? Two common ways are via PayPal and a bank, via a merchant account interfacing over a gateway.
  • Onsite or offsite: you can have the user stay on your online store website to enter their card, or go to another site, such as PayPal. The former (onsite) is much more professional, but is more difficult to set up because of security issues.
  • PayPal: many online stores have the option of paying by PayPal (the purchaser will need their own PayPal account). This is very popular as it does not require the puchaser to enter their credit card number.
  • Payment to the supplier: remember that you will need to pay the supplier. Make sure this is allowed for. It may be as trivial as bank-to-bank transfer, or as sophisticated as cross-currency international transfers.

13. Determine policies

There are a number of very important policies that you should determine and possibly document on your online store. Often these are lengthy and quasi-legal, so a very good source for these is to read what is on other online stores, and take material relevant to you, ensuring you change it sufficiently to make it your own:
  • Shipping policy
  • Security policy
  • Return policy
  • Privacy policy
  • General terms and conditions

14. Logos and graphic design

You should consider if you want professionally created logos and design to feature in your store. This can be expensive, but it will build brand trust and a good perception. Often companies that build online stores provide logos, however technical skills and graphical skills are very different. If you do choose professional graphic design, ensure that the company providing it can prove competence in that field.

15. Build the online store

OK, finally - after thinking about it, researching it, choosing it, checking it - you are now at the point where you can start to build the damn thing. Remember that building the online store is very technical in nature. Unless you have the domain knowledge and experience, you will need to someone to get help on this. There are companies who can do everything for you, such as Online Store Creation.

16. Populate the online store

One of the last steps before you go live with your store is to populate it with products. Ensure that the descriptions of all products are accurate and catchy, and that the images are professional, clear and large. Remember the closest a purchaser will ever get to browsing your product is through the images you supply, so make this an opportunity for both seller and buyer. You as the seller can increase your sales by having truly appealing and lovely photographs that make the viewer wish he owned the product. Conversely, the buyer will want to see the product in detail, from a number of different angles, in its full glory in order to make a confident and informed decision about purchasing it.

17. Marketing

Getting your online store trading, selling and on the internet is one thing. But having users actually find your store is quite another. For that. you will need to do some marketing, with tools such as Google Adwords. See the Marketing your online online page for more detail.

18. Search Engine Optimisation (SEO)

SEO is similar to marketing, but is focused exclusively at doing various things so that search engines such as Google return the best ranking for you, for the relevant keywords. See the SEO for online stores page for further information.

19. Analytics

Analytics provides important information about visitors to your online store. At the very least your should ensure that every page on your site has Google Analytics embedded within it. This is completely free, easy to use, and provides a wealth of information such as how many visitors went to each page, the day and time they visited, which region in the world they came from, where they were directed from (for example other links, Google search engine results), etc.

The other thing you should activate on your website is the Google Webmaster Tool. This is free once again, and provides data around how the Google search engine sees your site. For example how many websites link to your store at any time.

20. Go Live

Go forth and multiply your profits, as they say.

QUOTE OF THE DAY Buying something on sale is a very special feeling. In fact, the less I pay for something, the more it is worth to me. I have a dress that I paid so little for that I am afraid to wear it. I could spill something on it, and then how would I replace it for that amount of money?
- Rita Rudner