Statistics show that online shopping is growing rapidly - a trend that presents both opportunities and challenges for entrepreneurs selling via websites.
First, some numbers. According to Forrester Research, online shoppers in the United States will spend $327 billion in 2016, up 62 percent from $202 billion in 2011. By 2016, Forrester adds, e-retail will account for 9 percent of total retail sales. Growth in the number of online consumers will climb 15 percent, up to 192 million in the U.S. from 167 million last year. And each buyer will spend more on average - up 44 percent to $1,738 from $1,207 in 2012.
Good news and Bad News
On one hand, this rapid growth presents a lucrative market of potential prospects. On the other hand, the proliferation of online shopping outlets means that small- and medium-sized businesses have more competition than ever before. A good inventory and well-built website will only get you halfway to success in this competitive market - if that.
Online retailers have several obstacles to overcome on their way to success. Among those is conversion - that is, converting visitors to customers. By some estimates, the average conversion rate in Internet retail is only 3 percent.
Another obstacle is shopping cart abandonment - when prospects add products to a cart but leave without checking out. Baymard Institute compared 18 separate studies on shopping cart abandonment, concluding that 67 percent of ecommerce transactions are abandoned on average.
Internet retail success demands that entrepreneurs learn how to keep their sites "sticky" - offering expert customer service, a robust shopping cart experience, customer-written product reviews, and any other means at their disposal to keep a prospective customer on their site hitting the "buy now" button (instead of wavering or going elsewhere for more information and a better deal).
Fortunately, there is now a wide array of applications designed specifically to overcome obstacles to Internet retail success for small- and medium-sized businesses. Software for email marketing, lead generation, customer service and support (including live chat), and streamlining accounts payable/receivable are all available - as are applications for revenue monitoring and inventory management, drop-shipping, order processing, retargeting and even buyer incentive and referral programs.
The Must-Have Applications for Internet Success
Let's take a quick look at the software and services no fledgling Internet entrepreneur can live without.
HubSpot. When it comes to automated customer segmentation, this is the app. Users can sync their store data to one of the world's leading marketing automation platforms, making email marketing and lead nurturing much easier.
MailChimp. Customer data seamlessly syncs with MailChimp for easy email marketing, newsletters, list management and measurement.
Zendesk. The leading cloud-based customer service software can pull in relevant customer data and display it right on the support tickets a company uses to track issues - leading to quicker support resolution and happier customers.
Webgility eCC. A powerful solution for connecting a store to any version of QuickBooks, as well as shipping processors and payment gateways - all streamlined and automated to save time and prevent errors.
Ordoro. This comprehensive shipping platform improves shipping times, reduces labor, decreases costs and gives them access to powerful drop-shipping capabilities.
Stitch Labs. Merchants today sell in a wide variety of ways, and StitchLabs pulls all those together into one order management tool. Whether orders are taken online, via phone or fax, or at events and trade shows, inventory is automatically synced across channels.
ShipStation. Merchants can integrate their stores with ShipStation's sophisticated, easy to use solution to save time and money on shipping through automated order processing and batch shipping label creation.
Lexity Retargeting. Retargeting - once a weapon in the arsenal of only major companies- comes to small businesses with this Lexity app. By retargeting shoppers with professional, personalized display ads on other sites, this dynamic piece of software helps bring back some of the 98 percent of shoppers who don't buy on their first visit.
Olark. Live chat and support have long been the linchpins for success among major players like Zappos and Apple. Olark gives merchants of almost any size the benefits of talking directly to their customers, including the ability to view cart contents for each visitor and offer upsells and special offers based on what they're buying.
71lbs. Late UPS and FedEx shipments account for nearly 6 percent of all shipments. And what most merchants don't know is that they are owed a full refund on orders that arrive late. When a merchant uses 71lbs, all their shipments are monitored for late orders, and refunds are automatically claimed and credited back to them.
SumAll. This is an incredibly powerful analytics tool that retailers can use to monitor all their revenue data in real time, including sales and discounts, allowing them to see which products and marketing efforts are worth investing in.
Yotpo. Internet retailers who install Yotpo on their stores get access to an easy-to-use, fully customizable review platform that allows customers to review products and share those reviews on social media, driving traffic and engagement.
RetailTower. With RetailTower, businesses can automatically submit their products into 15 shopping comparison engines, including Google Shopping, Amazon, Bing, SortPrice and more. Submission to these popular channels increases reach and drives sales.
Lexity Live. This app lets merchants track visitors on their site in real time, seeing which pages they view, which products they add to cart, and where they drop off. Lexity Live users can also chat with shoppers to close sales and get actionable marketing insights.
ReferralCandy. By using ReferralCandy, merchants can incentivize buyers to refer friends to their store by emailing them a shareable coupon after purchase.
As Internet sales continue to boom, it will take sophisticated tools and analytics to rise above the noise. Even the newest Internet entrepreneurs can enhance their websites - and their revenue figures - by taking advantage of applications and analytical capabilities previously reserved for only the largest, most popular online brands.
About the Authors
Mitchell Harper and Eddie Machaalani are the co-founders and co-CEOs of Bigcommerce, the world's fastest-growing SaaS ecommerce platform that helps power over 30,000 small businesses online. Contact Mitchell mitchell.harper@bigcommerce.com, Twitter handle @mitchellharper. Contact Eddie at eddie.machaalani@bigcommerce.com, Twitter handle @eddiemachaalani.
