What is an e-commerce platform and how to choose the best one for your business
What is the secret of success of an e-commerce business? It would be easy to open a virtual store if the answer to that question were simple, but there is one important key factor: choosing the right e-commerce platform.
All of your operations will depend on it: product display, inventory control, sales, payments and promotions, along with other activities. Any mistake in your choice could compromise your store’s results.
Therefore, let’s understand what the job of e-commerce platforms is!
What is an e-commerce platform
In general, there are a number of different reasons that may lead you to change platform, but you must always bear in mind that the main goal of the e-commerce platform is to be a marketing agent, increasing sales and reducing costs. Of course, depending on your maturity and knowledge, the concept may undergo changes.
For example, for an initial store, being a marketing agent may be setting up the store in the shortest possible amount of time, therefore the platform should be a simple one that you can set up by yourself.
For larger stores, being a marketing agent can be regarded as increasing conversion, the ROI, the life-time-value, and as a result increasing the channel’s profitability.
Depending on your case, and whether you fall into the first or second category, you should look for specific features and characteristics. And do not be afraid of choosing a platform and then in 12 months’ time having to change it. The process of migration is a natural one in the store’s evolution. What we have to look for is the right solution for the moment you are at.
Therefore, the e-commerce platform varies from business to business and it is not possible to say that this or that platform is the best one for the whole market. It’s the same thing as with a car, you first need to know your profile in order to decide what the best option is. But as time goes by, your profile will change.
Responsibility of the e-commerce platform
Every e-commerce platform offers these two structures, which are known, respectively, as front-end – the store’s interface with the consumer –, and back-end – the store’s interface with the administrator.
When we talk about front-end, we are talking about everything that is on display for the customer. The layout, the banners, the products, the content… all of this can be browsed by the client.
In turn, back-end, as its name suggests, is everything that is behind the system, in other words, the administrative panel. It is through the back-end that you can set up the rules so that the front-end can present a solution to the client.
For example, when we register our photos and attributes, we are doing it directly on the back end, in the same way as when we are looking at which requests were made on any given day.
Now, when it comes to what the product page, the elements and the distribution of the content will be like, we are talking exclusively about the front-end, namely, how this setting is presented to the client.
Difference between ERP and an e-commerce platform
Often managers end up confusing the two systems, but they are totally different both in terms of the features as well as terms of development characteristics as a system.
A platform, as has already been said, is a marketing agent. Therefore, everything that is related to the client’s arrival at the store up until the finalizing the order, can be regarded as its responsibility. Here are a few examples:
- Creation of the layout and usability of the virtual store;
- Rules of promotions;
- Features for attracting traffic such as XML and SEO;
- Search system;
- Complementary and supplementary product recommendations;
- Checkout and integration with means of payment.
In turn, the ERP system is responsible for management of the virtual store. Starting off with a request made by the e-commerce platform, it comes into action to help make its operation more efficient and automated, in addition to helping with decision making.
Types of platforms
But that’s as far as the similarities go. There are a number of platform options on the market that offer different features and cater to different types of business. The main types are listed below:
- Open source (free and open source platforms);
- On-premises (proprietary platforms under license);
- SaaS (leased platforms under the software as a service model).
In order to better understand the differences between the types of platform, download our free e-book: E-commerce guide: Understanding the models of e-commerce platforms existing in the market.
Why it is important to choose the right platform
An error in choosing your supplier can cause your company to go bankrupt. We’re not saying here that you have to hire the most expensive one, but rather the one that will provide better optimization.
Let’s go back to the example of the car in order to illustrate the idea in an easier way. Let us assume that the buyer’s profile is as follows:
- salary of R$3,000;
- first job, so no reserves;
- the car is always on the street.
For this profile, if the car purchased is one that costs R$50 thousand, even if it is possible to pay R$2 thousand for each installment, it will also be necessary to pay for gasoline, expensive insurance due to the fact that the car is left on the street and probably repairs due to crashes given that it’s the buyer’s first car. So this is certainly not the best choice.
Probably a second-hand economy car, which is not targeted much by thieves, would be the ideal choice. Note that the profile may change over the course of time.
The platform should be viewed in the same way. You should do an in-depth analysis of your own business in order to choose the best platform for your virtual store – and do not worry about having to migrate from one system to another. This change over is part of the evolution of any virtual store.
How to choose your e-commerce platform
There are thousands of options in terms of platforms on the market and no doubt one of them will be the best fit for your store, so do not worry about the supplier.
Worry about understanding your own profile.
1. Initial investment and monthly cost
At this point, you should keep in mind that the initial amount paid to set up your virtual store cannot exceed 20% of your project’s total capital. That’s it! If you have R$15,000 at your disposal, you should probably opt for a free platform or one with the lowest possible initial cost.
Remember the story of the cars and always put a priority on making investments in traffic and inventory. These two variables will be the most important ones for anyone who is starting their store.
Now if you already have a well-established company or you have the money to set up a bigger project, the 20% rule is still valid, but you can probably go for more powerful tools. At this point, you should make an assessment of each one’s features.
2. Review the front-end features
The features that each system provides will help you on two important fronts: increasing the store’s conversion and creating an incredible usability for your client. The secret here is to really know your clients and also to know which stores they shop at.
In order to do this, you can use some strategies:
- get to know the Persona of your online store will clarify various aspects regarding who you are selling to and how to communicate.
- knowing this Persona’s purchase journey will help you define which communication channels and what content should be created;
- analysis of stores that are already known in the same segment will provide you with good examples of interesting features that should be present in your store.
3. Analyze the back-end features
Here are some key points to evaluate in the interface with the administrator:
- ease of use of the administrative panel;
- ease of management of orders;
- creation of promotions, offers and discount coupons;
- search engine optimization (SEO);
- integration with marketing tools (Analytics, Adsense, social networks, etc.)
- integration with payment solutions, logistics and marketplaces;
- integration with ERP and CRM systems;
- complete management reports.
4. Analyze the supplier
Because there are many market options, there will always be a good chance that you end up choosing a supplier that does not yet have a proven market system. So here are some tips that may help you:
- international references such as Gartner and Forrester along with Brazilian ones such as E-Commerce Brasil and E-Awards given to this supplier;
- current customer base, similar to your store;
- success stories and results achieved, similar to your store;
- support provided.
Now that you know a little more about e-commerce platforms, their responsibilities and how to choose the best option for you, it’s time to roll your sleeves and get your hands dirty!