How to Start an Ecommerce Business

Thanks to technology, starting an ecommerce business is easier than ever. In the past, entrepreneurs needed to sign a lease for a retail space, stock their brick-and-mortar store with products, and rely on foot traffic for sales. But things are different now: Today, more than half of customers (53%) prefer to engage with businesses digitally. Online shopping is ubiquitous, and with the right ecommerce tools and strategies, any entrepreneur can start an ecommerce business.

Have an idea for a new business venture? Here are seven steps to successfully launch an ecommerce business

• What is an ecommerce business?
• Why is an ecommerce store important?
• How to start an ecommerce business in 7 steps

An ecommerce business is a company of any size, in any industry that sells goods or services online. A website that sells concert tickets is an ecommerce business. A streaming service that sells monthly subscriptions to access movies and live events? Also an ecommerce business. If a consumer or business buyer can browse and buy your products online, you have an ecommerce business.

Digital sales channels (like websites, mobile retail apps, and social commerce) make it possible to sell to anyone, anywhere. This means ecommerce businesses can reach exponentially more customers than companies that only operate with physical storefronts.

Along with the opportunity for more sales, ecommerce stores are also important if you want to meet customer expectations. It's crucial to build a presence where customers like to shop: online. Meeting customer needs is the key to running a successful ecommerce business. Consumers today have high expectations for omnichannel sales, convenience, and speed. In fact, 81% of customers expect faster service from companies as technology advances. And 74% of customers expect to be able to do anything online that they can do in-person or by phone, including buying products.

Ready to turn your concept into a thriving ecommerce business? Start by breaking down the process into manageable phases. Here are seven steps to help get you started.

If you're reading this article, you probably already have a business idea brewing. Excellent — you're on the right path! The next step is to conduct research to gauge demand for your product or service. Here are a few research methods that will help you collect the information you need:

Surveys and interviews

Surveys and interviews provide direct insights into the needs, challenges, and preferences of your target audience. Responses will help you understand if whether your product solves a real problem and how potential customers feel about your idea. You can also uncover any concerns or objections potential customer might have through direct feedback.

Competitor analysis

Researching your competitors will give you a better idea of what's working in the market and reveal any gaps you can fill. Start by analyzing competitor websites, reviews, social media, and marketing strategies to identify what resonates with your potential audience. By studying their strengths and weaknesses, you can find opportunities to differentiate your business as you build your presence online.

Search trends and keyword research

Search trends and keyword research tools can help you track interest and identify emerging purchasing patterns. These tools can reveal whether demand is steady, seasonal, or growing, and provide insights into long-term sustainability. Additionally, this research can show where customers look for products like yours and how they prefer to shop, guiding your marketing, sales, and commerce strategies.

Prototype testing

Another effective way to validate your business idea is by creating and testing a prototype. You can start with a simple, low-cost version of your product using basic materials or digital mockups. Tools such as wireframes, sketches, or minimal viable products (MVPs) allow you to test core functionalities without a huge investment. Keeping the process simple and focused on essential features allows you to gather valuable feedback from potential customers, validate demand, and refine your idea without breaking the bank.

Now that you've solidified your idea and know what you want to sell online, it's time to figure out how much it will cost to get started. The good news is that launching an online business can be significantly less expensive than a physical retail store. For example, you won't need to spend money on rent, utilities, or in-store staff if your ecommerce business is strictly online. Here are some of the core costs you'll want to consider in your start-up budget:

• Ecommerce platform: Monthly fees for your ecommerce platform covering your digital storefront, hosting, and customer lifecycle tools
• Product sourcing: Costs of purchasing or manufacturing your products, such as raw materials, inventory, or wholesale items to stock your online store
• Shipping: Expenses for shipping products to customers, including boxes, labels, tape, and carrier rates
• Marketing: Funds for paid advertising campaigns, SEO, ecommerce content marketing, email marketing, and more
• Payment gateway: Setup fees and processing transaction fees for credit card processing
• Inventory management and fulfillment services: Warehousing and shipping services

You wouldn't start construction on a new building without a blueprint — just you shouldn't start an ecommerce business without a business plan. Your plan should outline your mission, goals, and strategies that will guide your decision-making and help you stay on course. This outline will steer you through every stage of building and growing your ecommerce company. Here are the critical elements to include as you write your business plan:

• Executive summary: Give a brief overview that offers a clear snapshot of your entire business.
• Company overview: Provide information on your company's structure, industry, background, and key team members.
• Mission statement: List the core values and business goals that drive your ecommerce strategy.
• Market research: Identify your target market, ideal customer, and trends affecting your industry.
• Competitor research: Add your competitor research, highlighting the main opportunities to differentiate your business.
• Products and services: Clearly describe your products, including details such as sourcing, pricing, and delivery logistics.
• Marketing and sales strategy: Explain how you'll attract and retain customers through channels such as SEO, social media, content marketing, email campaigns, and paid ads.
• Business roadmap: Present a timeline with key milestones for growing your business, from launch to scaling.
• Operations plan: Provide details about your supply chain, order fulfillment, inventory management, and day-to-day operations.
• Financial projections: Estimate your pricing, sales goals, profit margins, cash flow, and funding needs.
• Legal and compliance: Cover your business registration, tax setup, licensing, and any relevant legal considerations, including contracts with suppliers or partners.
• Tech stack: List the platforms you will use to run your business, including your ecommerce platform, customer relations management (CRM), and customer support tools.
• Customer service plan: Outline how you will support your customers, whether through live chat, email, or phone.
• Risk analysis: Identify potential challenges or risks your business may face, such as supply chain disruptions or market changes, and how you will mitigate them.

Now that you know what you're going to sell, consider how you will source the products. What's the most efficient and cost-effective way to deliver a high-quality product your customers will love? Here are some of the top ways ecommerce businesses source their products:

Creating products in-house

If you are a manufacturer or an artisan looking to sell creative, custom handmade or digital products, your products will be created in-house. Examples of this could be anything from artisanal candles, jewelry, custom-designed clothing, or manufactured leather goods. When you create your products in-house, you control every aspect of the production process. Creating your own products gives you the best brand differentiation, but it can also make it harder to scale. You'll need trusted partners to help you produce more and grow.

Sourcing from manufacturers

Sourcing from manufacturers is a good idea if you are mass producing items with detailed specifications that need precise consistency. For example, if you sell coffee tampers, wine, or tech gadgets, you want every product to be consistent and match the product description perfectly. To start, research potential manufacturers, request samples, and then negotiate terms.

Drop shipping

Drop shipping is a method of selling products without holding inventory. Commonly drop shipped items include phone cases, fashion accessories, and home decor. These are lightweight, easy to ship, and have broad appeal. When a customer orders, you forward it to a third-party supplier for fulfillment and shipping. This approach minimizes your upfront investment. However, strong supplier relationships are also important to prevent delays and stock issues.

Print-on-demand

Print-on-demand is another low-investment way to source products. With print-on-demand, you can sell custom products such as T-shirts, hats, and accessories without holding inventory. A third-party service will print and ship the items when a customer places an order. This allows you to test designs without committing to large orders. But keep in mind that third-party printers often charge a hefty commission.

You've settled on a product and have a plan for production. Now, it's time for the fun part: setting up an ecommerce platform so customers can start placing orders and you can start making money. There are several ecommerce platforms on the market, and you'll want to choose one that taps into modern tech, makes it easy to set up a gorgeous ecommerce website, and runs all your business operations from a single space. Here are a few features your ecommerce platform should have:

Front-end tech

Your website is often the first interaction an online customer will have with your business. You'll want it to be sleek, responsive, and customer-friendly. Not a designer? Don't worry. The best ecommerce platforms come with front-end tech that makes it easy to create a beautiful site to boost engagement on both mobile and desktop.

Ease of use

You shouldn't have to be a developer to use an ecommerce platform. Choose a platform that's simple to navigate and lets you manage your store without technical issues. Everything from setting up product listing pages to tracking orders should be intuitive so you can focus on growing your business rather than troubleshooting.

Omnichannel experiences

On average, consumers engage with companies across eight channels . That means you want your customers to be able to find and buy from you on your website, social media, mobile app, and more. Not only that, but it's important that all of these experiences on different channels feel cohesive. Choose an ecommerce platform that syncs products, inventory, and customer data across every channel to create a smooth, connected experience for you and your customers.

AI-driven product recommendations

If the ecommerce platform you're researching doesn't offer AI-driven product recommendations, move on. The best platforms use ecommerce AI to assist with tasks such as offering personalized product suggestions to your customers based on their browsing habits. These smart recommendations help increase average order value and drive more sales by showing customers highly relevant items — without extra effort on your part.

Automation

Imagine how much time you could save by automating repetitive work such as order confirmations, inventory updates, and customer follow-ups. The right platform handles these everyday actions so you can focus on strategic decisions and scaling up.

Order management

Your platform should make managing orders seamless by tracking every purchase from start to finish. Real-time shipping updates keep customers informed, while an easy return process builds trust. The ideal system offers full visibility into your order pipeline, ensuring that every stage — processing, shipping, and delivery — goes smoothly.

Inventory management

Staying on top of inventory is essential to prevent overselling or stockouts. Your platform should monitor stock levels in real time across all sales channels so you're always in sync. Whether you're managing one warehouse or several, look for a platform that offers real-time updates so you can confidently fulfill orders and avoid any gaps in availability.

Integrations

Your platform should connect with top social apps and CRM, ERP, and marketing systems to provide a full view of your business and customer interactions. These integrations help make your operations more efficient and enable you to deliver personalized experiences that foster loyalty.

Customizable and scalable technology

As your business evolves, your platform should, too. Opt for customizable technology that can adapt to changes in site design and large increases in traffic and sales without missing a beat.

Choosing the right ecommerce platform provides you with all the necessary tools to build an engaging customer experience on your website. But how do you attract customers to your website in the first place? The right marketing strategies and tools will help here. After performing market research and once you identify your ideal customer, marketing your products and services to them should become much easier. A deep understanding of your target audience will help you determine where to market and what kind of messages will resonate. Here are a few channels where businesses build a presence and reach a wide audience.

Social media

You can promote and sell your products on social channels like TikTok, Instagram, and Meta. This is what’s known as social marketing and social commerce. You can run paid ads, promote user-generated content (UGC), create your own marketing content, and even sell your products directly on these platforms.

Paid ads
When you’re browsing the web and you see prominent digital ads for a brand you love, that’s not a coincidence. Those are paid ads — and they’re a great way to garner attention and sales from potential customers as they search online. These ads run on a pay-per-click (PPC) model, which means they cost your business a certain amount each time a user clicks on your ad.

Content marketing

Ecommerce content marketing encompasses all the written content on your site, like product descriptions, blog posts, FAQ articles, and more. This content can help you build brand awareness, establish trust, and capture more customers. Content marketing is a major part of establishing your brand voice and tone, and it should also be a critical piece of your ecommerce SEO strategy.

SEO

Ecommerce SEO, or search engine optimization, involves all the actions you take to improve the visibility of your digital storefront and your products in search engines. This includes content marketing, but also more technical elements like internal linking, tagging product pages, and URL structures to help your pages rank higher in search engine results pages.

Email marketing

Email marketing is one of the most effective marketing channels for ecommerce merchants. Why? Because subscribers actively opt in to your email marketing lists, indicating interest and showing that they’re eager to hear from you. Once someone has given you their email address, you can send them highly personalized emails, encourage them to make purchases, and track their engagement.

Before going live, consider a soft launch. This involves releasing your website to a smaller audience to gather feedback, track commerce metrics, monitor site performance, and fix any issues with speed, customer experience, payment gateways, or inventory management. This step helps to ensure everything is running smoothly before you expand to a larger audience.

Also make sure to test your site's load capacity to ensure it can handle traffic surges during promotions or product launches. You must also ensure your transaction processing is secure and functions smoothly across all payment methods. Test the user experience by checking for broken links, slow load times, or difficult navigation. Confirm your site is mobile-responsive and verify that the checkout process is simple and glitch-free to prevent cart abandonment.

It’s difficult to overstate the importance of your platform decision when it comes to starting an ecommerce business. With a comprehensive, connected ecommerce platform like Commerce Cloud, you can take advantage of out-of-the-box tools for front-end design and back-end operations. And it’s all included in one intuitive system. A platform that enables innovation and speed is crucial, especially when you consider that 65% of customers expect organizations to adapt to their changing preferences.