There are many benefits of starting an online store, including reaching a wider audience and increasing revenue. However, entering this market can be overwhelming since there are so many steps to ensure that your eCommerce business is the best it can be. Plus, the competition is fierce, with more and more entrepreneurs starting to sell online.
Luckily, I've got the answers on how to start an online store—including tips for picking the perfect eCommerce platform, sourcing products, registering your business, and advertising your online store to drive more traffic to your website.
I’ve already done the research for you, so there is no need to spend hours scouring Google. This guide has everything you need – just follow along the step-by-step process. If you're just starting out and want more information, you can also watch my video about how to start an eCommerce business.
Let's dive in!
Step-By-Step Guide To Starting An Online Store
These are the steps to follow to get started with creating a successful online store.
Step 1: Create A Brand
When you start an online store, it's crucial to brainstorm what kind of business you hope to run, including the products you want to sell and what vibe you want your business to convey— both in terms of aesthetics and marketing.
Below are some steps you can take to create your brand so that you will stand out in a competitive marketplace.
Choose A Product To Sell
When considering what kind of product you want to sell, you should ask the following questions: Do you want to sell your homemade goods, or are you looking to use an existing supplier? Do you have a niche interest or unique knowledge that you can turn into a profitable business?
Make sure that the product you choose is something you are interested in selling and promoting. If it's not something you are passionate about, it will be more challenging to be knowledgeable about your products and invest fully in your business.You should also do market research ahead of time to ensure that the market you’re going into isn’t overly saturated. Using product research tools like Niche Scraper or Google Trends will help you narrow down your options.
Brainstorm A Business Name
Once you’ve decided on what products you’ll be selling, it’s time to think of a catchy business name. Choosing the right business name is imperative since you want it to be memorable and informative to potential customers.Not sure what to name your business? You can check out websites like Shopify’s free business name generator tool or Namelix for inspiration.
Develop Brand Imagery
You want to make sure that your online shop's visuals are consistent and aesthetically appealing. Invest in quality, professional photos, and videos to attract customers. If necessary, you can also hire copywriters to write the copy for your website, as well as create the right blog posts and advertisements.
You also need to think about how you plan to present your business online – do you want to look fun and casual or more formal? Whatever approach you take, you should stick with it and use the same tone across all of your material.Another essential part of brand imagery is your logo. You can create a customized brand logo with tools like Looka. Ensure that your logo is visible on all your product photos used in blog posts and other promotions.
Differentiate Your Brand
There are many ways to set up your online store to give it a distinguished personality. Differentiate your brand by creating a catchy slogan or appeal to a niche audience by offering unique products or services.
Shopping online can feel impersonal, so customers are always looking for something to connect with—writing custom content and letting customers know about the origin of your business story will help them connect better with you and your products. You can do this by setting up an “About” page and writing blog posts.
Step 2: Establish A Business Strategy
Having a business plan is crucial for the efficiency of your online store. Many new sellers make the mistake of not planning out costs or looking into the legality of running an online business ahead of time, which can create a big headache later on. Not to worry, though—by following these steps, you will be prepared to take your business live.
Iron Out Your Costs
Once you know what kind of online store you want to build, it's crucial to determine the costs involved. The first financial factor to consider is your start-up costs, like paying for an LLC and other business licenses, designing your website, sourcing your inventory, and paying for advertisements. You may also consider outsourcing employees, from copywriters to SEO experts, for extra help getting started.
Once your business is up and running, there are two main categories that you need to consider – fixed and variable costs. Fixed costs will remain relatively consistent, like monthly hosting fees and payroll.
Variable costs will vary depending on the number of sales you make. This category includes shipping charges or any other cost incurred when fulfilling an order, like the packaging for your products. Your marketing and advertising needs may grow over time as well, which you can factor in if you are trying to scale your business.Depending on the size of your operation, these costs will vary significantly. According to WebFX, the average fees range between $1,000-$10,000 for a small business and $50,000 to $100,00 for a larger enterprise.
Make Sure Your Business Is Legal
You can set up a Limited Liability Company (LLC), a low-cost legal enterprise popular with small business owners. This step is essential because it means that if anything were to go wrong with your online store, your personal assets would not be at risk.
Filing for an LLC will cost different amounts depending on what state you operate in, but they typically range between $50-100.
You'll also have to apply for an Employer Identification Number (EIN) on the IRS website. Your EIN allows you to register for and pay state and federal taxes.
Depending where you live, there may be additional legal requirements, such as licenses and permits, so make sure you do your research before you start selling.
Register Your Domain
Once you’ve decided on a name for your business, be sure to make sure the name isn’t already registered using the trademark database. Ensuring your business name is unique is crucial to protect your business and avoid being sued.If you're clear to go, purchase the domain to make sure that no one else has the same idea as you later on. When it comes to creating the perfect domain, make sure to check out my guide on how to choose a domain name.
Check Out Your Competitors to See Their Monetization Strategies
Part of developing your business strategy should involve checking out (and even copying) how other businesses in the same industry generate revenue. Think about what they offer and how much it costs, then research their marketing campaigns and pricing strategies.You can do this research by reaching out to business owners you admire or enrolling in online seminars. A fantastic resource is Shopify Learn, which provides free business strategy courses.
Step 3: Figure Out Fulfillment And Shipping
Find Out How To Source Your Products
Once you have the layout for your business ready, it's time to figure out how you want to source your inventory. Locating inventory will depend on the type of business you are running and what kind of products you want to sell.
There are quite a few options for sourcing your products:
If you are an artisan or are skilled at crafting items, making your products by hand is a fun and creative way to get started selling online. This method will save you the stress of working with third-party manufacturers but will take more labor on your part.
A DIY business may also be more challenging to scale since you'll be responsible for making and shipping all products. If your operation is large, you'll also have to consider storage space.
You can hire third-party manufacturers and wholesalers to source your products as well. You'll have to find a supplier with products you want to sell or a manufacturer that can produce the inventory.
The advantages of these are that you can access many different types of inventory at reduced rates if you buy in bulk, but the start-up costs will be higher since you'll have to purchase merchandise before selling it.
Retail arbitrage is the process of buying products yourself, which gives you the freedom to be creative and hone in on your specific interests. Products sourced from retail arbitrage can include vintage items and collectibles, as well as retail and household products. You can source the products by shopping in-person or online.
However, this is a more unreliable method since you may not always be able to find the products you want to sell, especially if they are rare or unique. You'll also have to spend a lot of time searching and shopping independently.
Dropshipping involves sourcing a product and listing it on your page without holding the inventory yourself. Instead, you will delegate the fulfillment and shipping process to the third party that sends the product to customers when you make a sale.
Dropshipping has lower starting costs since you won't have to purchase inventory until you make a sale, and you won't have to worry about storage. However, there is a lower profit margin and not much control over the quality of your products.
Decide How You Want To Fulfill Orders
Now that you've determined how to source the products you'll list on your online store, it's time to figure out how you will fulfill orders. Fulfillment is the process of packaging and shipping orders. Selling online gives you a couple of options for fulfillment.
As I mentioned, dropshipping means that you order items from a third-party supplier, and they handle all of the fulfillment. This method takes a lot of the work out of the process for you, but you'll have to ensure that you're using a company you trust. One tip is to ask for samples before agreeing to partner with the company that manufacturers the product you want to sell.
Dropshipping can also make customer returns a bit tricky since there's a more complicated supply chain to move through. Since the products are shipped from another business, brand awareness may also be challenging to acquire.
If you are ordering from manufacturers or wholesalers, holding your inventory is another option. This process gives you more control over your inventory, but it's more expensive because you have to account for warehousing costs.
Fulfilling orders yourself will also be more laborious, but you have the advantage of more easily connecting with your customers and increasing brand awareness. You can customize your shipping material with your logo and business name and include personalized notes or gifts.
Many eCommerce platforms include resources to handle fulfillment and shipping.
Now that fulfillment and shipping are covered, I'll get into creating your personalized website using an online store builder so you can start listing and marketing your products.
Step 4: Create Your Website With An Online Store Builder
I already went through my choices for the best eCommerce store builders, so once you decide which is the ideal platform for your business needs, it’s time to get to the fun part—designing your website!
Below are some hacks that will keep your store organized and streamlined so that you can effortlessly set up a beautiful website.
Sign Up For A Free Trial
Many eCommerce platforms, including Shopify, Squarespace, and BigCommerce, offer a free trial, typically for 14 days. Take advantage of this opportunity to explore the different website layouts and design options to see which is the easiest to navigate.
Since the various hosting sites offer different perks, this is a fantastic way to get your feet wet and see which platform meets your operation's aesthetic and functional needs.
Customize Your Online Store
Show off what makes your company special and different from the competition so that people can connect with you on a more personalized level. You could think of a creative way to use a bold design concept or a specific color scheme, for instance, that will make it easy for shoppers to identify you.
If you're not sure where to start, it would be a good idea to take a look at your competitors and see what they're doing in this area. Thankfully, many templates are customizable, so you can add your personal touch when designing your website.
Above all, make sure to showcase the products you are selling. A smart way to do this is to have a clear, compelling header above professional photos of your products.
Create Key Online Shopping Pages For Your Store
Key pages are the core of your online storefront—it's what people will see when they first enter your site, and each page must answer a few important questions, as follows:
There are additional tabs you can add to your online store to increase customer loyalty and retention:
Step 5: Add Your Products
Most eCommerce platforms make it simple to start listing your products (above is an example of Shopify’s template). While this process can take some time, the more detail you provide, the better!
Here are the key product details you should pay attention to when adding your products to your online store:
Write Your Product Title And Description
When adding your products to your website, product descriptions and titles are some of the most critical items you should fill out. You want to make sure this section includes an accurate description of your product and any related keywords that you feel people will use when searching for it online. This way, when someone is conducting an internet search for your product, they're more likely to find you.
The description should be detailed and accurate, so customers know exactly what they are purchasing. You can add details like sizing, brands, and instructions for use or care.
Upload Product Photos Or Other Media
Your online store's products aren't going to sell themselves. They need to be easy for people to see and appealing enough that they'll click "add to cart.” Make sure you add photos of your products— if possible, include more than one view.
Experimenting with adding professional videos and other forms of media, like 3D models, will give your store an edge. The better the quality of the pictures and videos, the more likely customers are to purchase items, so hiring photographers or media experts can help ensure that your images are top-tier.
Organize Your Products Into Collections
Now that you’ve added your products to your online store, it’s time to organize them into collections. You can also use these sections to highlight popular items or group common items together. The goal is to make the shopping experience as streamlined as possible for customers, so organizing your products will make it easier for buyers to find what they want.
Set Your Price
You need to think like a buyer and consider how much you would be willing to pay for each item. Aim high rather than low because if people believe they're getting something of high value for an agreeable price, they are more likely to make a purchase.
Research the current market value for similar products so that you know what to aim for. Make sure to also account for shipping costs and transaction fees from your chosen payment processor.
Step 6: Market Your New Online Shop
Online marketing is an important part of a successful business model and gives you the opportunity to advertise everywhere - from social media platforms to search engines. Let’s take a look at the different ways you can drive traffic to your page using marketing strategies.
Social Media Marketing
You have to go where your audience is, so create profiles on all of the major social media networks, like Facebook, Instagram, and Pinterest. Build a following by sharing high-quality content that will keep people coming back for more and find ways to increase traffic with targeted ads and paid boosts.
To drive additional interest, you can also create social media contests that your followers can participate in to win free products or discounts on their next order, driving up engagement and visitors to your website at the same time.
Influencer marketing is one of the most underrated strategies for gaining traction to your online store, but it's also one of the most effective. If you can get respected people in your industry to promote your products, their followers are much more likely to trust these products and make a purchase.
This tactic could include anything from reaching out to influencers with a significant following for a paid partnership, offering free products or discounts in exchange for promotion, or incentivizing your most loyal customers to spread the word by offering discounts.
Pay-per-click (PPC) Advertising
Digital stores have an advantage compared to physical retailers when it comes to advertising. You can use Google Ads or Facebook Ads to target potential customers shopping for relevant products on search engines or social media sites, leading them straight to your listing rather than a competitor's website.
Remember that the costs can add up since you will be charged a fee every time a customer clicks on one of your ads. However, many PPC advertising sites allow you to track analytics to ensure that your efforts and money are generating revenue.
Your email list is one of the few assets that can't be duplicated anywhere else since you have a built-in audience for your store. Sending out short updates to your subscribers will keep your customers informed about new products and deals. Promoting special offers and sales is a great way to grab the attention of online shoppers, and you can always run them for a limited time to boost urgency.
What Is An Online Store?
Simply put, an online store is a digital marketplace you can use to sell products or services on the internet. eCommerce platforms allow users to create a storefront and sell items online directly to customers. These transactions can be completed using secure payment processors, so you won't have to stress about security.
You can set up an online store for any type of business, whether you sell homemade products, want to expand your brick and mortar store, or plan to dropship niche items—the possibilities are endless.
There are many benefits to starting an online store, including the following perks:
Think you're ready to run a successful online store? Let's take a look at some tell-tale signs that you're prepared to start or expand your business using eCommerce.
Signs You're Ready To Start Your Own Ecommerce Store
Before you dive right into opening an online business, there are a few things to consider. Setting up an online store is appealing to many people but the reality of life as an entrepreneur is not always as easy as it may seem.
If you think you've got what it takes, then there are some signs that can help you determine if now is the right time to start your business.
You Want to Be Your Own Boss
Starting your online business is a great way to be your own boss. You'll have the freedom to be creative, and running an online store will allow you to set your schedule and work from virtually anywhere.
However, you'll need to be able to commit yourself 100%, even on the days when you're feeling unmotivated or overwhelmed. It's also important to realize that starting an online business takes effort; it won't be a get-rich-quick scheme, and you'll need dedication, a solid business plan, and strong leadership skills for your store to succeed.
Starting an online store takes time and effort, but if this is a career avenue you are passionate about, taking the necessary steps to build your business online will be worth your while.
You Want To Diversify And Add Another Revenue Stream
One of the main reasons for starting an online store is that it can help expand your existing business. With the rise of technology and online shopping, more and more companies want to extend their reach online.
If your current business has been running successfully and you want to take it to the next level, an online store is an excellent option. You can use it as a secondary revenue stream or as a way to diversify and grow your income. It's wise to have multiple sources of income, and with an eCommerce platform, you can expand to a new and thriving market.
On the other hand, maybe you want to start an online business as a side-hustle to supplement the income you're already making—with low start-up costs and the ability to work when you want, selling online is a fantastic way to make some extra cash.
Whether you already have a brick-and-mortar business that you want to integrate with an e-commerce platform, or if you're just getting started as an independent entrepreneur, there are plenty of opportunities for diversification in the e-commerce world.
You Have Experience In Related Industries
If you already have experience in the retail industry, it might make sense for you to try your hand at starting an online store. Since you already know a thing or two about selling items and interacting with customers, this is a great way to put your existing knowledge into practice and learn new skills.
While having knowledge about the industry isn't required, it will give you a leg-up when building your online business. Any knowledge about design, marketing, or customer service will also benefit you in the long run.
If any of the above criteria applies to you, then you're likely ready to take the next step to make your dream a reality.
Let’s now go through the best online store platforms so that you can decide which site is best for your business needs.
Best Online Store Platforms: The Top 5
The good news is that you don't need to be a tech wiz to launch an online store. Many eCommerce platforms will help guide you through the process and take care of all those pesky technical tasks like coding and implementing a payment gateway.
It can be challenging to know which hosting service to choose with all the options out there. Below are five of my recommendations, with details on pricing, features, and more, so you can decide which is the right fit for your business model.
Shopify is a popular ecommerce site that hosts 1.7 million merchants— this includes companies ranging from small business owners to large enterprises. They provide an easy-to-use store builder with pre-made templates that will help your store look streamlined and professional without any experience with website design.
The appeal of Shopify is the simplicity of setting up and customizing your online store, as well as the all-in-one functionality of the platform: you can create advertising campaigns, integrate with your in-person business, and communicate with customers.
Here are some additional features worth noting:
You can try Shopify for free with a 14-day trial, but when you’re ready to go live with your store, Shopify has three paid plans to choose from:
Squarespace is another leading platform that allows you to create your own online store. The site is known for its beautiful, award-winning design templates and therefore is an excellent choice for those who want to create a website that looks professional and unique.
Squarespace provides all the tools you need to start selling online and has additional resources, including the following:
Squarespace also provides a 14-day free trial. If you try it out and decide it’s a good fit, Squarespace has four options for paid plans:
Wix is a free online website builder that lets you design and customize your online store with hundreds of templates and advanced features. There are also paid premium plans to help you further optimize your store and sell directly from your website.
Wix offers tons of cool perks, including the following features:
While Wix offers templates and hosting for free, you can upgrade to a premium plan to access even more amazing features. I would recommend the Business and eCommerce plans for running an online business since they allow you to accept online payments.
Here are the different options:
BigCommerce is a store builder for online businesses that allows users to sell their products, no matter their business plan. They have specialized templates and designs for different products, whether you're selling apparel or manufacturing your inventory.
Here are a few of BigCommerce’s most notable features:
Bigcommerce offers a free 15-day trial, after which you’ll have to choose between one of their three payment plans. Here are the details on the monthly fees:
WooCommerce is an open-source eCommerce website that integrates with WordPress, allowing you to set up a store in just a few minutes. The great news is that the service is free to download, allowing you to cut down significantly on overhead costs when you start an online store.
WooCommerce also comes with a ton of helpful features:
While the platform is technically free, there are still costs to consider including hosting your site, paid themes, payment gateway costs, SEO optimization services, and shipping costs. To get a better idea of these costs, you can check out their pricing guide.
How To Start An Online Store - FAQ
With more and more customers turning to the web for their online shopping needs, online stores are becoming increasingly profitable. According to BigCommerce, 46% of consumers in the United States placed a retail order online in 2020.That said, the market is increasingly competitive, so your profits will depend significantly on your marketing efficiency, the quality of your products, and the amount of advertising you purchase. Statistics by ZipRecruiter show that the average annual salary for online retailers is $44,496.
Opening an online store takes a lot of work and determination, but following a step-by-step guide will help you break down the process. Here is an outline of the methods I mentioned in the article:
Though there are plenty of paid and free eCommerce platforms to choose from, I recommend the following based on their extensive features:
These paid platforms (except WooCommerce, which is free) include tons of perks, including discounted shipping rates, easy integration with social media, mobile apps, marketing campaigns, and more.
The world of online selling is constantly changing, but one thing that will never change is the customers looking for something new to buy every day. If you can provide them with what they need quickly and efficiently, they'll reward you with their loyalty and business.
Having a solid foundation and coming into the eCommerce world prepared will give you a significant advantage when opening your own online store. Using my guide, you can make a list of steps you need to take to reach your goals. While the prospect may be overwhelming at first, you'll be well on your way to opening a successful online store with these tips and tricks.