Ecommerce White Papers Wednesday, June 28, 2017 
White Paper: Selecting Ecommerce Software for your Online Business

 

Abstract
If you are ready to sell online, choosing the best ecommerce system for your business can be a challenging and confusing process. In this white paper, we will examine, and help make sense of, the two main types of ecommerce systems, their advantages and disadvantages, and how to make a good decision for your business.

 

The Problem
Today's dizzying array of ecommerce software solutions presents a major hurdle to new businesses as well as those which have outgrown their existing ecommerce solution. With all of the available choices, how should you go about choosing what is best for your business? What are the factors you should consider?

Are you just starting out or upgrading from another ecommerce system? Depending upon your situation, your needs will be different. If you are upgrading, then the ability to import your existing products is extremely important. If you are just starting out, then a low cost system with low maintenance and minimal setup (such as CustomCart) will allow you to focus on running your business instead of focusing on your web site. What about security, features, and support? We will take a look at various factors involved in the selection of an ecommerce system.

 

Hosted solutions vs packaged software - what's the difference and which is best for your business?

There are essentially two kinds of shopping cart systems: packaged ecommerce software and hosted ecommerce software. We will examine each in detail.

Packaged Ecommerce Software
A packaged software solution is one that you buy from a software store or from an online software company (sometimes called a software vendor). This type of software will come to you either on a disc, such as a CD ROM, or via download from the vendor's web site. With packaged software, you are usually expected to install and configure it yourself. Whether you install it on your server or a server at the Internet Service Provider where your site is hosted, this can be a challenging proposition. Although the software vendor will generally provide installation assistance, some will charge you for this service so be sure to ask about installation support and whether it is included in the cost of the software before you buy. Another thing to consider about packaged software is that once you buy it, you own it. And you will continue to own it long after you have outgrown it and moved on to something else.

Hosted Ecommerce Software
Hosted solutions, sometimes called "On Demand Software" or “Software as a Service” are hosted remotely (not on your web site's server) and you connect it to your web site and pay a monthly service fee. Because this type of solution is hosted remotely on the vendor's servers, there is nothing for you to download or install - that part is already done which saves you significant time and effort. What you will need to do is connect the hosted solution to your web site. This usually involves some simple HTML code that you add to your web site pages.

Depending upon the system you choose, you may need to create and add the "Add to Cart" button code to your existing web catalog pages (normally using a code generator) or upload your item information into a hosted catalog system.

Generally speaking, it is much easier to select a system that includes an online catalog (such as CommerceSuite) so that you can upload your items and manage them using a web-based administrator. This allows you to manage your online store from any internet-connected computer anywhere in the world. An additional benefit of hosted solutions is that most offer import capability if you are upgrading from another ecommerce system.

Hosted solutions also offer a scalability that packaged software can't. Scalability refers to how well the hosted service manages increasing load as the traffic to your web site grows. A hosted service can bring more servers and more bandwidth online to keep the customers flowing to your site. Packaged systems are less able to scale up as your needs increase.

So, which to choose? All things being equal, a hosted solution will allow you to focus more on your business and leave the running of the software and servers to the technical experts.

Pricing
Price is a key factor in any business decision and the price of your ecommerce software is no exception. Packaged solutions are generally less expensive to buy at first, but over time, additional expenses will creep in. By contrast, a hosted solution is offered for a low monthly charge that will add up over time. One of the key advantages of a hosted solution is that someone else is responsible for managing the software, providing upgrades, fixing bugs and so forth. On the subject of upgrades, when you buy a packaged solution, it may or may not come with a period of time during which you can upgrade to the next version for free. In any case, at some point, you will probably have to pay to upgrade to a new version of the software and, of course, go through the installation and configuration process again. With hosted software, upgrades are usually included at no additional charge and when they occur, there is nothing you need to do, the new features simply appear.

When you buy an off-the-shelf packaged solution, you will likely have to pay extra for support and setup assistance whereas many (but not all) hosted solutions include support at no additional charge. If you select a hosted solution, make sure that they provide free and unlimited technical support.

Packaged solutions range in price from free (more on free software later) to thousands of dollars. Many software vendors offer support contracts for an additional fee. Support contracts are generally annual commitments and very often, the price increases with each successive year. Be sure to check carefully with the software vendor before you buy to make sure you understand what the additional costs are going to be.

Know your budget. Can you afford to layout hundreds or even thousands of dollars all at once to buy a packaged software system and follow that up with support contracts, software upgrades and so forth? Or is it better for your business to pay a low, fixed monthly service charge for a hosted solution?

Security
Security of packaged software is another hurdle. When you buy a packaged shopping cart system, you will need a security certificate. The security certificate is used to encrypt the information that your customers will type into the checkout portion of the cart to assure that their personal information and credit card number are protected from prying eyes. Credit card security has always been a significant issue for ecommerce. Buying a security certificate is relatively straightforward, but installing and configuring it is technically challenging and is a task best left to experts. Very likely, your Internet Service Provider will have the expertise to assist you with this although you will probably incur a charge for this service. In addition, security certificates have a 1 or 2 year lifespan, at the end of which, you must buy another one and go through the installation and configuration process again.

 

Credit card merchant accounts and payment gateways - what are they and why do you need them?
A credit card merchant account allows you to charge your customer's credit card for your product or service. If you own a brick-and-mortar business, chances are you already have a credit card merchant account. In order to sell online, you must have a “Card Not Present” merchant account. This allows you to take orders over the internet (or over the phone for that matter). In the case of a brick-and-mortar store, you will most likely have a terminal which you use to swipe through your customer's credit or debit card. The internet equivalent is called a payment gateway. It works like this:

  1. The customer enters their credit card number, expiration date, and other information into a form on a secure page. You have probably done this yourself if you have ever purchased anything online.
  2. When the customer clicks the submit button, this information is sent to the payment gateway for authorization. The payment gateway is a type of software that communicates with the credit card's issuing bank.
  3. The payment gateway contacts the bank where the credit card account exists and requests an approval. If the customer has sufficient credit available, the card is approved. If the credit card is over its limit or another problem exists, then the purchase is declined.
  4. The payment gateway sends the approval (or decline) back to the shopping cart system which presents a message (approved or declined) to the customer.

As you can see, without the “Card Not Present” merchant account and payment gateway, an online sale can not take place since there would be no way for the shopping cart to approve or decline a credit card. In addition to checking the availability of credit on a credit or debit card, the payment gateway can also verify the billing address of the customer and use this information to help prevent fraud. This is called the Address Verification Service or “AVS”.

So, how do you go about getting a Card Not Present Credit Card Merchant Account? The best way to start is to contact your bank. If your bank does not provide merchant accounts or you are not happy with their terms, go to Google or another online search engine and type in “Credit Card Merchant Account”. Be sure to spend some time speaking with several merchant account providers. Compare their terms and pricing to get the best deal that you can. Also, be sure to find out which payment gateways they support and compare that to the list of payment gateways supported by any ecommerce system you might want to use on your web site.

 

What are your support options?
This is perhaps one of the most important (and most overlooked) aspects of investing in an ecommerce system. Before you buy any shopping cart or ecommerce system, find out what your support options are. Does the vendor include free and unlimited technical support? Is it free for a specific period of time, after which you are expected to pay? Maybe installation support is free, but you must pay for other support.

How do you get support? Many ecommerce system vendors offer only email support, although the best vendors offer phone support as well. When you have an issue, do they give you a tracking number? Is there a means of entering a support request that tracks your issue from start to finish? Is there a list of Frequently Asked Questions (usually called an FAQ) which might solve your problem immediately? Are there online support tutorials to help walk you through setup? Are there tutorials for advanced features of the software?

You should ask ALL of these questions before selecting an ecommerce software system.

 

Features
It might seem as though all shopping carts are alike. The truth is that there are vast differences between ecommerce systems in terms of their features so it is a good idea to know what features you want before you buy.

So,what features are important? It depends upon your needs. Do you sell items that have options such as color or size? Do these options change the price of the item? If so, you need an ecommerce system that can handle options. Do you want to be able to issue promotional codes to your customers so that they can get a discount on their order? What about a gift registry? Some items might seem more suited to a gift registry, but remember, Home Depot (www.homedepot.com) has a gift registry system on their web site and a hosted gift registry system (such as Registry Valet)can dramatically increase your sales.

Customization is a huge feature. How customizable is the system? Do you get full customization capability to make the catalog, cart, and registry systems look just like your website? Or do you get a choice of a few basic, prefab color schemes? The best systems allow you to fully customize the look and feel to match your web site including Cascading Style Sheets (CSS). Through CSS, the best ecommerce software allows you to change the look of every form field, every bit of text, virtually every element on every page of the catalog, cart, and gift registry system.

Branding
Part of customization (and marketing) is branding. Does the software allow you to completely brand your site as your own, or does the software vendor include a small ad or link to themselves at the bottom of every page? Most packaged software and many hosted solutions include an automatic link to themselves at the bottom of every page of your web cart and/or catalog. This is sometimes called "tagging". Incidentally, The Agenne Corporation never includes a link to itself or other self-advertisement in any of its products. It's your web site, it's your brand.

 

What about free software?
Since the inception of the internet, there have been free shopping cart systems available for download. Why not use one of these? There are a number of reasons to avoid free shopping cart software:

  1. Lack of features. Generally speaking, a free shopping cart will give you nothing more than checkout capability. Maybe this is all you think you will need, but think again. As your business grows, you will very likely need a more feature-rich system and a free shopping cart will not grow with you.
  2. Lack of support. Free shopping cart systems don't come with support. You may be able to find an online forum or other collaborative web site where you can learn from others who use the same software, but you won't be able to get on the phone with a support technician.
  3. No upgrade path. If you do decide to go with a free solution, be prepared to start completely over when you are ready to move up to something more capable. Free software rarely comes with a good upgrade path to support you as your business grows.
  4. Non-Secure Code & Hackers. This is the big one. Most (if not all) free shopping cart systems are written in simple web languages such as Perl, PHP, ASP, javascript, or other free web languages. This makes online merchants who use these free systems the target of hackers. Well, why not? The hacker can download the same free software, analyze it, and figure out how to hack into your cart or ecommerce system. This will put you and your customers at risk.
In the final analysis, it is a good idea to avoid free software, no matter how attractive it may seem. Like the old saying goes, you really do “get what you pay for”.

 

Making a Good Decision
When you are ready to make a decision, start by thinking about how the available choices fit your business model.

Remember that once you get it set up, your ecommerce system is going to be with you for awhile so it is a good idea to buy the best system you can afford even if you won't be using all of its features right away. Go with a system you can grow into, not one that you will outgrow quickly.

 

Conclusion
In this white paper, we have examined a series of factors which should be considered when selecting ecommerce software. From hosted solutions to packaged software, security, support, features, and pricing, it is important to take your time and analyze your options carefully.

  • Start with your budget. Choose a system you can grow into and avoid free software.
  • Hosted vs Packaged. Select a system that works for you, but generally speaking, you will be better off with a hosted system.
  • Features matter. Choose a system which includes the features you need or will need
  • Support is key. Check with software vendors carefully before you buy to make sure that they offer free and unlimited support.
  • Go Custom! Choose a system that allows you to completely customize the look and feel to match your web site. Remember that the best systems allow you to use CSS to match your site as closely as possible.
  • Scalability. Choose a system that can scale up as your business needs grow instead of locking you in to something you will quickly outgrow.
 
  Related Links

Agenne Home Page

GiftSuite

CommerceSuite

CustomCart

Registry Valet

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