Chapter 1: Importance of Having an e-Commerce Business

ecommerce advantages

What Are the Advantages of Ecommerce?

You came to learn what are the advantages of having an online business.

Top of the list of advantages of eCommerce is less financial cost but other pros include selling internationally, retargeting customers, personalization of the buying experience, etc.

These benefits of eCommerce will help you determine if starting an online store is right for you.

#1: Less Financial Cost

One of the eCommerce benefits is that it has a lower startup cost.

Physical retail stores have to pay up to thousands of dollars to rent one of their store locations.

They also have several upfront costs such as store signs, store design, buying inventory, sales equipment, and more.

Depending on what type of eCommerce business you run, you may only need to hire employees when you grow to a certain level.

As your online store is online these employees can work remotely, making it easier to find staff that will suit your company.

Your business expenses are generally much lower in eCommerce.

This is one of the most attractive benefits for new entrepreneurs looking to keep their costs low.

#2: Open 24/7

Another advantage of eCommerce is that online stores are always open for business.

With your Facebook ads, you can attract someone at 11 p.m. or 4 a.m. in any part of the world.

Most physical location stores are open between 9 a.m. to 9 p.m.

By being available at all hours, you can attract people who would normally pick up a product in stores, if the store were open.

#3: Sell anywhere across the world

You have the ability to discover your audience whether they’re in the U.K., South America, or neighboring countries.

If you choose to dropship from AliExpress, many products offer affordable ePacket shipping or free shipping.

This allows you to price and ship your products competitively to a worldwide audience.

Selling worldwide is a great feat as it helps you build your brand a lot faster, broadens your marketplace exponentially, and allows you to see profit long before your local competitors.

#4: Easily display best-sellers

Ecommerce benefits

Ecommerce benefits like being able to easily display best-sellers make it easier to show off products to customers.

While you can design a brick and mortar store to sway people to buy certain products, it’s easier for a customer to find the best-sellers in an online store.

If you want to showcase new products to customers you can include them in your upsell, email marketing or retargeting ads.

With an eCommerce store, you can include great product photography and product descriptions to sway the customer’s choice.  

#5: Personalized Online Experience

Persionalized Online Experience

Website personalization, one of the online business advantages, can enhance the online shopping experience.

Creating personalized landing pages for different audiences can entice them to buy from you without much extra work on your side.

You can do all the hard work before you launch a campaign and then relax once you release the campaign to your customer base.

Try segmenting your email lists based on purchases made, location or even how much money a customer spent.

#6: Need fewer employees

One of the benefits of eCommerce is that hiring employees is affordable and, as mentioned before, you can hire from anywhere in the world.

You can choose to outsource work to virtual assistants in countries where the cost of living is much lower.

You’ll need fewer employees in an online business than a retail location.

A huge advantage of online businesses is you don’t need to hire employees at launch.

#7: Capitalize on impulse buying

Another eCommerce benefit is that you can capitalize on impulse buying as online shoppers are more inclined to partake in this.

If you have attractive product photography, with vibrant color or human emotion, you can create ads that drive impulse buys.

You can also execute a range of scarcity tactics such as countdown timers or showcasing limited quantities.

#8: Easy to Retarget or Remarket to Customer

It’s easy to create retargeting ads to reach out to customers in your area when running an online business making it one of the most profitable eCommerce benefits.

You can create a Facebook pixel.

With eCommerce stores, you can retarget people who add products to cart but don’t abandon and don’t buy or who visit a blog post and never buy.

#9: Customers Get a Less Invasive Experience

Some people dread walking into a brick and mortar store as they’re forced to interact with the store’s employees.

Whether learning about a sales promotion or being asked questions throughout the shopping experience, some may prefer online shopping as it can be a little less invasive making it one of the best benefits of eCommerce.

If a customer wants to contact the store owner, they can click on a live chat feature, email or send a Facebook message.

#10: Gain Access to Customer Data Easily

One of the best eCommerce advantages is that you can easily gain access to data for analysis on your customer.

In eCommerce, you can get your customer’s name, mailing address, e-mail address, and phone number.

That means you have at least three different ways to communicate and build a relationship with them.

You can even have them fill out marketing surveys, share their birth date with you, and more.

If you ask them to create an account, you can obtain even more information from them to better serve them.

If your customers are based within Europe be careful of GDPR regulations when contact customers.

Customer Data Easily

#11: Easily Process a High Number of Orders

If you choose to dropship, you can process a high number of orders with ease.

As your business continues to grow, you might choose to hire employees to help with order processing.

Also with drop-shipping, you don’t need to physically have the product in order to sell it to a customer, therefore you do not have to worry about stock control like physical stores have to

#12: Can Scale Business Quickly

One of the benefits of eCommerce is that it’s easy to scale the business quickly.

You can increase your ad budget when ads are performing well without having to worry too much about keeping up with the demand, especially if you dropship.

With drop-shipping, you can add new products to your store without having to worry about shipping products or holding inventory allowing you to grow quickly.

# 13: Grow Your Business Organically with Content

With eCommerce, you can grow organic traffic and sales with ecommerce blogging.

From making videos to writing blog content, you’ll be able to optimize your store to drive traffic and sales without having to spend more money.

With eCommerce, you’ll be able to not only get traffic organically through content creation, but you’ll also be able to monetize those customers with retargeting ads.

What Are the Disadvantages of Ecommerce?

As with every pro, there is a con.

When starting an online store it is important to be realistic so below are a few eCommerce disadvantages that our merchants have run into, that do not apply to a physical store.

#1: No One Can Buy During a Site Crash

Site Crash

The worst of the eCommerce disadvantages is when no one can buy from your store if your site crashes.

That’s why it’s important to ensure your website is hosted on the right platform.

For example, if you’re paying the minimum hosting fee and get a surge in traffic from a high converting ad, your site will likely crash.

#2: Customers Can’t Try Before They Buy

While this is currently a problem for many retailers, this won’t be a long-term problem.

With augmented reality, more stores are starting to add AR elements to their store to allow customers to try products on. 

#3: Ecommerce Is Highly Competitive

Finding the right niche is another one of the worst e-commerce disadvantages.

The reality is the best niches are often the most competitive that’s why people are drawn to them.

The more competitive a niche is, the more expensive ads for that niche are. There are a couple of ways around this.

First, you can go after a different audience than your competitors.

If all your customers are being targeted by competitors through Facebook ads, you might try ranking organically with SEO optimization.

If all your competitors are using Pinterest, you might try Instagram marketing if your audiences are very visual beings.

Second, if your ads are expensive, you can send traffic to blog posts and retarget your customers who visit them to create lower-cost ads. 

Working on CRO campaigns can help you be much more successful than your customers.

Bottom Line:

Having an online business in the early stages allows you to become a leader in your niche.

Yet, most money made is in physical retail stores making it an eCommerce disadvantage.

Hence, why Amazon, despite being the biggest online store, is now creating in-person stores.

But, keep in mind that $1.3 trillion in sales isn’t a small number.

There’s still a lot of potentials that online retailers can cash in on.

And this number keeps growing.