E-commerce, or online selling, is changing the face of retail transactions globally. It has opened up new opportunities for sellers and buyers and has transformed the world into a global village.
Today, you don’t even need a brick-and-mortar store to become a successful seller. The Internet has made it easier to reach customers globally on a massive scale. In addition, the rise of online business has created an explosion of choices for the average consumer.
Even better, e-commerce has surged recently. Retail e-commerce sales were up to $211.7 billion in the second quarter of 2021, an increase of 7.6% from the first quarter.1 Currently, retail e-commerce accounts for 14.1% of global retail sales; a figure that is expected to reach 22% by 2024.2 Given the expected rise in sales, e-commerce is likely to play an increasingly important role in retail business around the world.
But being a part of this lucrative industry depends on having the right knowledge. If you’re new to online selling, you’re probably asking: What does it mean to sell online? How does e-commerce relate to retail marketing? How do you create a successful online store?
This article answers all of your questions, including what you should know about e-commerce, online selling technology online, and why you should consider moving your business online. You will also see the benefits you stand to gain from marketing your business on established e-commerce platforms like Alibaba.com.
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The Internet connects people today more than ever before. It removes all the barriers to physical trade and makes selling easier than ever. Selling sites like eBay, Etsy, Shopify, and Alibaba.com simply require you to set up an account, set up an online store for your business, and start selling.
With your online store, you place your business in a position to reach international shoppers. Social sites like Facebook, Twitter, Instagram, and YouTube, also provide online selling platforms. These sites allow you to reach your target audience on the apps and websites where they spend their time online, and it also helps you reach new demographics.
E-commerce platforms like Alibaba.com provide you with a broad audience, while at the same time enabling access to niche-specific audiences. This way, you can focus your marketing efforts on prospects with specific needs.
Selling online is the latest huge money-maker in business, and as a business owner, you are doing yourself a great disservice if you are not selling online. However, as beneficial as online selling is, you must know the right product to sell. Therefore, you need to understand what characterizes a product that is perfect for selling online.
Some of the characteristics of a good product are as follows:
Now that you know what characterizes a great product, let's discuss finding one to sell online. We have curated a list of eleven steps for you to use when finding the right product.
For more on finding the right product, please click here.
Now that you know the right product to sell online, let's talk about pricing and margins. How do you determine your pricing and profit margins? The first question you need to answer is whether you want to sell a product or service. Next, if you are selling a product, you must decide whether to be a wholesaler or retailer, or both.
When you have your answer, you can then move on to setting prices and profit margins. Selling wholesale means moving your product from manufacturing to distribution (B2B). Selling retail means buying the goods, probably from a distributor, and selling them directly to consumers (B2C).
Wholesalers employ different pricing models from retailers. However, the goal is to sell the goods at a higher price than it costs to make. When calculating your price as a wholesaler, you can use various strategies, such as absorption pricing, differentiated pricing, value-based pricing, competitive/market-based pricing, and bundle pricing. Here’s some more information on how to calculate wholesale pricing.
For retail pricing, you must first start by identifying the consumer or end-user. Next, you need to ask what they will pay for the product. When you have this knowledge, you can then decide on the percentage profit margin you want. Determining your retail price is particularly important if you are considering a drop-shipping business model.
Drop-shipping is an online selling business model that enables people to start online selling with little capital and allows them to keep their workload to a minimum. With drop-shipping, you don't have to worry about storing inventory as the model's USP is its simplicity. However, as simple as drop-shipping is, its simplicity comes at a cost, and you must understand all attendant costs before adopting it as a business model.
The average attention span of an online user is eight seconds.3 This provides you with a very narrow time window to convince your potential buyer that buying from you is a great idea. Thus, your content marketing strategy must include a sales copy that is attention-grabbing, precise, and straight to the point.
Customers are suspicious of transactions that result in them losing money. Leverage this and offer them an assured money-back guarantee. This way, they know they will get back their money if they are dissatisfied with their purchase. However, it would be best for you to have a system to ensure that the dissatisfaction is genuine and not someone looking to play a fast one on you.
The value that goodwill and satisfied customer testimony bring to your brand is inestimable. You can't buy it. Thus, you must include testimonials on your product page. With these, you show prospective buyers that you are a seller with whom they will be safe to transact.
Including trust signals on your product page is another great way to authenticate your business in the sight of prospective buyers.4 If your business has any professional accreditation, put it on your page. These further convince the buyer that they are safe to make their purchases from you.
Statistics show that 21% of buyers abandon the shopping cart because of a long and complex check-out process.5 Another 28% abandon the shopping cart when finding out that they have to create an account before they check out. With these figures, it is clear that buyers value ease when shopping online.
Whether it is your “per-click” or your paid social campaign, make sure that your sales copy has a consistent message across the board. It can be very off-putting for a buyer to click on an ad that grabbed their attention and find out that it leads to a related product or another product altogether. It also waters down your brand's authenticity.
As a business owner trying to bring your business online, you must decide on which platform you want to market your goods. There are three significant platforms currently pushing e-commerce: marketplaces, social media, and personal websites. We will discuss each of them in detail below.
A marketplace is a platform where a business can sell its products (goods or services) to its customers. The unique thing about online marketplaces is that they make it easier for a buyer to make purchases from many sources. A marketplace operator does not own any inventory but stands as the middleman between sellers and purchasers. As the third party in the business, the marketplace will provide order fulfillment services and guarantee secure financial transactions.
There are three major types of marketplace:6 vertical, horizontal, and global.
As a small business owner, marketplaces make it easy for you to run comparisons and position your business competitively in terms of product range, price, and other vital factors. You also enjoy the benefits of secure payments and deliveries, increased online visibility for your business, and, best of all, ease of use.
Selling on social media, also known as social selling or social media marketing, is when sellers use social media to find and engage with new prospects.7 With social media marketing, a seller can generate leads from user-generated content and, with these leads, interact directly with prospects on their chosen social media platforms.
Statistics show that social sellers sell 78% more than their peers who do not use social media. Not even B2B sellers are left out, with 39% of them stating that they were able to reduce their research and advertising time when they used social selling tools.8
With the tools that social media marketing hands you, you can monitor your competition and know what your customers are doing and saying.
You may also choose to go the route of having your own personal e-commerce website, where the products and services marketed are primarily yours. It does not matter whether or not you manufacture the products. You will sell them under your site's brand name, and you get to call the shots on the look and feel of your e-commerce website. Note, however, that you will also be responsible for your fulfillment services.
What do you stand to gain when you sell your goods on a marketplace? Below, we consider the pros and cons of selling on a marketplace, as knowing both sides of the issue will help you make more informed decisions.
Alibaba.com is a leading e-commerce platform that helps SMEs go global by assisting them in reaching millions of B2B buyers globally. We have over 26 million active buyers globally and receive over 400,000 product requests daily. So far, the businesses we host on our platform represent over two hundred countries and regions. Our success stories bear testament to our standing as a leading global marketplace that will serve you, your business, and your customers well.
When you sell on Alibaba.com, you get to connect with millions of business buyers from around the world. You also get the tools and know-how you need to build a successful online presence for your business. With this alone, you will save yourself months of hard work researching how to build a successful e-commerce business. Instead, you can spend that time on other essential areas of your business. Most importantly, selling on Alibaba.com allows you to pocket more from each sale, as in some cases, our take rates are as low as 0%.