Lessons from Twenty Years of ecommerce

My very first ecommerce site was a supplement to my store in 2000. There was little online competition. Amazon sold only books. Most my opponents were small independents like me, and it was easy to stand above the crowd. I promoted the website on shopping bags, on leaflets at conventions, and in an occasional magazine.

This post is the second in a series on beginning and developing an ecommerce company. The first installment,”Launching an ecommerce company: the first steps,” I published last month.

As my online business grew, I hired a professional firm for search engine optimization. (Notice the spelling of”optimisation.” I deliberately chose a company in the U.K., as my customers were mostly there.) Soon I had doubled and re-doubled my clients. The company taught me a few things — the main was metrics.

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The writer’s ecommerce site in December 2000. Source: Wayback Machine.

Learning the Metrics

An ecommerce merchant can collect lots of numbers about visitors — their conduct, where they land on your site, where they leave, how they search, etc.. A merchant can spend hours looking at this information and tweaking the site.

And I did.

At length, however, I concentrated on two metrics: How many visitors and orders. I drilled down to the orders to be certain they were profitable. That is the goal, after all: How much profit does the site make?

Over time I jumped to pay-per-click advertising using Google AdWords. Metrics became essential, especially the conversion speed , that is the number of orders divided by the quantity of visitors. If a site has 100 traffic and receives one sequence, the conversion rate is 1 percent. The cost per 100 visitors should not exceed your gain on such purchase or you are wasting your time.

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If the conversion rate surpasses your competitors’, you have the ability to pay more for advertising. You can double or triple your conversion rate by, say, improving your descriptions, images, and menu structure, and providing a no-quibble 30-day return policy (as examples). Increasing the conversion rate results in more profit from the identical amount of visitors.

Discovering Email

An email list drives conversions. Grab the email address of consumers and then offer products depending on their unique interests. Targeted promotions have a much higher conversion rate. Assembling an email list was simple when I started. There was no or little resistance to spam and no regulations. Now, in 2020, merchants must explicitly obtain consent from every client.

In my experience, the trick to successful email advertising is restraint (not sending too often ), relevancy, and list hygiene (promptly removing unsubscribes and bounces).

Order Management

As my business grew, a growing percentage of sales came from the website. Online sales were an extension of my physical shop and were simple to control. As online sales improved, however, the process became more involved. Items sold in volume online which didn’t sell in the shop. Products and quantities started to diverge. Purchasing inventory became more complicated. The Internet allowed for pre-orders, which aided compute order amounts. I expanded into eBay and Amazon. EBay was particularly great at selling overstocks and collectibles, such as signed books. And earnings from Amazon escalated, taking revenue from my website.

Offering items in more than one place creates stock complications, like selling one product simultaneously on, say, Amazon and my own site. Order management is minimal with just a few orders daily. However, it might be a nightmare with several dozens daily. I chose software called Linnworks to manage orders from multiple channels. Linnworks tracked my inventory across all channels and decreased available stock levels as appropriate. Additionally, it automatic delivery, satisfaction, and client notifications.

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Like most order management platforms, Linnworks includes features I wanted were distinct. It was cheaper, but to flex my processes to the software as opposed to vice versa. I used Linnworks for many decades, and it was crucial when I began processing over 100 orders each day. It easily paid for itself. However, Linnworks kept increasing the price. I had to move to a cheaper, less feature-rich alternative.

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Payment Processing

There are now many providers offering services to ecommerce companies. The prices of lots of those providers are a part of the cost value. I avoid these providers as the percentage is typically the same for orders of $1 or $1,000, as an example. Why charge a whole lot more for the $1,000 order? It will become a travesty when the provider’s fee is more than your profit!

The one exception to a fee percentage is credit card processing. The processing companies take a risk, which increases with the price worth. Regardless, it’s daunting to obtain an affordable processor which suits your business.

The one exception to a charge percentage is credit card processing.

When I started, I used the credit card system in my physical shop for internet orders. My ecommerce site could send an encrypted email with the card info, and I would type them on the credit card machine. This was the height of security then. Nowadays it is laughable.

For many years I used a merchant account for online trading only. I paid set monthly fees for the privilege. I had an yearly Payment Card Industry scan and scan. I ended PCI compliance forms. I spent making sure my coupon was both eloquent and protected so that shoppers did not abandon their carts.

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Finally, I gave up and changed into PayPal. Customers had to pay via PayPal by leaving my site and then returning to consummate the transaction. I paid a higher commission percentage per transaction, but overall it was cheaper. Surprisingly, my conversion rate climbed. Apparently my customers preferred PayPal.

If I were starting today I would use only PayPal or a different well-accepted payment platform, such as Amazon Pay, Google Pay, Apple Pay, or comparable. It avoids the need for PCI compliance and it changes the security headaches to the experts.


What did I learn over time? Having an fantastic ecommerce website is indispensable. It requires excellent content, such as detailed product descriptions and clear pictures. Easy and secure checkout and clear communication throughout the purchase process will bring customers back. A wonderful stock system is vital so that clients aren’t told that we can not fulfill their orders. And finally, create a consistent email newsletter that customers wish to get. These are the foundations of a fantastic ecommerce business.

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