Month: March, 2010

How much should an ecommerce site cost?

This is a question I’ve been asked recently, and the easy answer is anything from £200 up to £2,000,000, with most sites I imagine costing between £2,000 and £20,000.

A key factor is the scale of the site (do you have 10 products or 10,000 products) and obviously there is a wide spectrum of ecommerce solutions available, from an off-the-shelf standard template to bespoke solutions, through on-demand and open-source platforms. The total cost comprises upfront costs and monthly/ annual costs, and revenue-sharing can be an option.

This is an interesting estimation of the work (in person days) involved in developing an ecommerce site, as taught to ecommerce students at Kingston University, which amounts to 5 months work for one person full time, or more realistically a small agency working on a handful of projects.

Project planning including creative, technical, integration, budgeting, testing and promotion 9
Wireframing/diagramming of processes, logic and functionality 5
Agreement of functionality, specifications and plan within budget 2
Graphical design (within brand guidelines) 10
Conversion of design into templates and style sheets 5
Product modelling and database design 2
Design of decision support tools to help shoppers select, choose and experience 2
Design of customer service processes and systems 5
Implementation within shopping software, CMS or from scratch 15
Integration with stock and ordering systems 10
Integration with payment partner 2
Collection and manipulation of content 10
Testing for browsers, platforms and DDA compliance 10
Delivery and training (editorial and CMS) 2
TOTAL person days 92

I have been quoted £20,000 by agencies for a design and ecommerce solution, and then opted to do the design in-house and achieved the same result for £2,000 within 6 weeks with a hosted ecommerce solution. I also see plenty of projects posted on freelance websites like peopleperhour.com where ecommerce sites are built for less than £200.

There’s an interesting discussion here amongst ecommerce developers; Should an ecommerce site cost £1,000, £10,000 or £50,000?

Whether you’re spending £200 or £2 million the same considerations apply:

  • Be clear about what you want the site to achieve; think about what the customer wants and deliver a clear message
  • Scalability; plan for today and tomorrow
  • It’s easy to focus too much on the physical design at the expense of functionality; get the right ecommerce platform with the right functionality and you can make it look however you like
  • Think about issues like merchandising, promotions and stock availability sooner rather than later
  • Research thoroughly, and build usability into the design
No Comments by on March 31, 2010
filed in Ecommerce design, Ecommerce strategy
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Online logs

Hearing it might snow again, I thought I would try and buy some firewood online…

It’s interesting to compare the delivery strategies of these two sites, which both appear top of the organic listings; neither website gets it right in my opinion.

The first site, Onlinelogs.co.uk has good call to action (big buttons to “buy logs” and “buy kindling”). You are then given a quite sophisticated-looking pop up map of the UK which 5 or 6 coloured zones, although we’re not told the key to the zones. You then select your postcode area either by clicking on the map or from a drop-down menu. Only then can you see the products available, except that there are no prices – to see the price you need to enter a quantity of bags and click to get the quote, which includes delivery. Which is just as well as the header of the site promises Free Delivery in big red letters. It all seems needlessly complex, and not very customer friendly.

The second site shows prices and does actually offer free delivery (on orders over £50 which is most products). Although – ironically – it doesn’t inform the customer that delivery is free; not on the product pages, not in the shopping cart and not even on the delivery tab on the top menu.

Stating clear delivery costs throughout the site is one of the most effective ways to improve conversion rate on an ecommerce site; offering free delivery is even better. This is true of any ecommerce site, even more so when your product is bulky and heavy like firewood.

With a small amount of consumer testing and/or using Google analytics both of the these websites could improve conversion considerably.

1 Comment by on March 30, 2010
filed in Ecommerce design, Ecommerce strategy
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Trends in internet retailing

This is a nice summary of key trends, from internetretailing.net

  • Multi-channel integration. Online consumers are getting ever more demanding, and ever more intolerant when retailers fail to join up their multi-channel dots. A seamless cross-channel experience, driven by a single view of the customer, will become a core requirement for success in the years ahead.
  • Mobile. The potential of mobile as a new channel for retailers has received much of the industry’s attention over the last few months. The ability for customers to easily price check, find the latest coupons and deals and purchase online from their mobile phone — even in-store — is going to lead to significant changes in shopping habits.
  • Mobile – again. One of the most interesting developments is likely to be the way in which mobile will link into retailers’ multi-channel strategies as a way to connect up the different channels through technologies such as mobile barcodes, coupons and NFC.
  • Delivery. Fulfilment and delivery service providers have responded well over the last few months, introducing ever more sophisticated delivery options. ‘One size fits all’ is no longer enough.
  • Personalisation. Everything from personalised on-site recommendation engines to tightly targeted email campaigns will be key to delivering growth as internet retailing becomes ever more competitive in the years ahead.
  • Choice. Whether it’s offering a wide range of ways to pay, or options for the frequency of marketing emails, consumers are set to expect online retailers to use information gained from previous purchases and site visits to tailor the offering to meet their particular needs.
  • Social media. On the one hand, social media has now become quite entrenched. On the other, however, an understanding of the ways in which social media can be leveraged to aid business decisions is still in its early days and is set to deliver significant commercial advantage to those who gain the greatest expertise.
  • Email. Still very much a key sales driver, and one that internet retailers still need to be investing in and making a key development priority.
No Comments by on March 29, 2010
filed in Ecommerce strategy, SEO, Social media
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Add to bread basket…

My local bakery in Stepney looks as if it hasn’t changed for decades, so it’s pleasantly surprising to see them embracing the online world with a modern-looking website, in fact two websites for trade and retail customers, and a Facebook page updated several times a week.

When I first discovered the site they were actually selling bread online, with a “add to bread basket” feature a nice touch… Although they don’t seem to be selling online currently, it’s a lovely example of a local business using a website and facebook to win new customers and build loyalty with existing customers.

Facebook has just updated me about the “Almond macs coming out of the oven…” – I might wander over and try some…

No Comments by on March 23, 2010
filed in Ecommerce design, Ecommerce strategy, Social media
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Is adwords ever “not cost effective”?

I was talking to the owner of Sunspel, a website selling luxury menswear both online and offline, who came out with the statement “Adwords is not cost effective for us” (not for product-related keywords, only for brand-related keywords).

My main experience with Adwords was for Viners.co.uk where my adwords campaigns generated 50% of sales at a cost per conversion of around 10% of the average order value – so very cost effective, in fact the most cost effective marketing channel in that particular case.

Of course an adwords campaign will not be particularly cost effective if the keywords chosen are not relevant, if ads are poorly written, and landing pages are poor. But the point made by Sunspel was that there were too many competitors bidding on keywords like “T Shirt” or “mens clothes”, and with so much competition it’s difficult to push a luxury message vs. a price-based message.

To some extent I had it easy running campaigns for a site selling mostly cutlery, where the majority of traffic came for a handful of “cutlery”-related keywords. And there are fewer Adwords competitors in the world of cutlery than T shirts. But to a much bigger extent Adwords was cost effective due to constant optimization; stopping keywords and ads which were not cost effective, refining keywords and ads which were more cost effective; constantly looking for trends and opportunities in the long tail of search terms.

No Comments by on March 15, 2010
filed in Ecommerce strategy, SEO
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Stop designing websites, start designing posters

This is an unusual use of .gif product images on a patterned background in an online shop – perhaps inspired this trend for web design inspired by poster design.

I also like how the price (and all product text) is only shown when you mouse over the product. Not very search engine friendly, but a bold attempt to make the product the hero, and sell the sizzle not the steak.

No Comments by on March 12, 2010
filed in Ecommerce design, SEO
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I Like:

Zappos.com (the biggest online retailer of footwear in the US, now owned by Amazon) has this nice widget to encourage you to “blog about this item”.

I Like:

Ramona by Lassen at Zappos.com
Ramona by LassenZappos.com - Powered by Service

It’s a great example of building engagement with the brand AND helping SEO by building links to their site. Apparently Zappos has been doing social media well for a while, as this chart of inbound links since they embraced Twitter shows:

No Comments by on March 5, 2010
filed in SEO, Social media
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Incremental sales, or cannibalising from other channels?

Reading about the imminent launch of a Gap ecommerce site in the UK got me thinking about to what extent online sales are incremental, or merely cannibalised from existing channels.
Gap in the UK has been a notable latecomer to online retailing (along with Primark, H&M, Zara, Claire’s Accessories, Morrisons…). In the US it has been trading online since 1997; in the UK it been testing the water with an online offering through asos.com.

It’s interesting reading discussions about why brands aren’t trading online. This one assumes that online sales have the potential to bring in 10% of total offline sales. Whilst this seems a reasonable ballpark for any retailer, it can’t be assumed that the 10% will be incremental and not simply customers who would have bought in store switching to buying online instead. It’s difficult for most brands to assess whether or not online sales are incremental, because there are so many competing factors determining retail sales and customer behaviour. Perhaps in Gap’s case the uplift would not be significant – as Gap’s stores are fairly widespread and I suspect the customer base is fairly loyal. Perhaps this has been their experience in the US, hence the slowness to launch online?

In some cases there’s a more compelling case for incremental sales – for a retailer with stores only in one part of the country, online opens up a much wider market. In my own experience working for a retailer with 15 or so stores located in factory outlet centres I don’t believe there was much cannibalisation from the stores, however there was almost certainly cannibalisation from other consumer and trade channels.

Of course there are many more benefits to trading online; lower cost of sale, brand building, more marketing channels, more flexible pricing & merchandising and the multichannel benefits (customers researching online, purchasing in store and vice versa). It is always better to be selling online yourself rather than through a third party, to be able to control pricing and how the brand is portrayed (on other sites and in their online advertising).

I did find a survey from 1999 predicting only 6% of online sales would be incremental. I would guess the experience of most brands is even lower than this. My conclusion? Not selling online is a missed opportunity, but the opportunity is complex and about much more than just sales.

No Comments by on March 1, 2010
filed in Ecommerce strategy
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© 2011 Helen Coupland