For this topic we will be considering e-commerce both as when a financial amount is transacted, like through a shopping cart, or the exchange for goods is personal information, like newsletter sign-up or user registration.

Adding e-commerce to your website:

Selling one or many products

Things to consider when selling products through your website:
  • How many different products will you be offering?
  • How much product do you anticipate selling and how frequently do you anticipate making a sale?
  • How will you handle shipping?
  • How will you handle non-website orders?
  • Will you be stocking the items for sale?
  • Why should people buy from you?

How many different products will you be offering?

From the single item store to the multi-category online superstore, the difference in cost and time largely depends on you.  The development for a product store with a shopping cart is about the same for a site with five products or a site with 5,000 products.  The difference in cost is determined based on who will be entering the products, you or your website designer.  The best way to save costs on an e-commerce system is to enter the products yourself which will also make you more educated on how your inventory relates to online users.  Any confusion you may have in the entering process, your users are likely to have in the purchasing process.

How much product do you anticipate selling and how frequently do you anticipate making a sale?

Depending on the amount of product you anticipate selling, you should choose the payment processing method that will best suit your needs.  For a large volume of transactions, a merchant account and gateway with a company like Authorize.net is your best option.  For infrequent purchases, a small volume of transactions, or you really don't know how much product you will sell, a service like PayPal is a low risk solution to get started with e-commerce.  See payment processing below for more details on making your payment processing choice.

How will you handle shipping?

If you will be shipping products, it is best to use a system that retrieves live shipping rates on-demand.  This will ensure that you do not lose profits due to fluxuations in shipping costs.  To be safest, you can add an additional handling fee onto each shipping cost to cover your time packaging.  Establish a shipping cut off time, which is the latest time an order could come in and be processed on the same day.  Allow yourself enough time to package and prepare for delivery pick-up or to drop off at your shipping company.

How will you handle non-website orders?

Managing orders through more than one system can become confusing, especially when trying to keep track of inventory.  The system you use to run your e-commerce application should allow you to process non-website orders, like orders over the phone, with the same interface you process website orders.

Will you be stocking the items for sale?

If you will not be stocking the items you will have for sale, you should only allow those shipping options that will allow you to deliver the products according to the customer's request.  For example, if you sell tables, and must first make the table, be sure that you do not have overnight shipping available as an option.

Why should people buy from you?

Are you the only company that will be selling the product you offer?  If not, you need to know what would make customers purchase from you over your competitors.  If there is not a compelling reason that sets your website apart from your competitors, you should not expect many people to leave your competitors, especially if they have already made a purchase.

Payment processing

The two major options for payment processing are an integrated method or a 3rd party method.  The integrated method will allow your customer to check-out without ever leaving your website.  The 3rd party method will re-direct your customer to another website to submit financial information and then return to your website.  In both cases you will not need to, and nor should you, store financial information on your website.  Authorize.net provides great services for the integration method and PayPal provides great options for the 3rd party method.

Costs associated with e-commerce

  • Merchant/Gateway account: $0 - $40 /month
    • Depends on if you are using an integrated method or a 3rd party method.
  • E-commerce/shopping cart software: $15 - $30 / month
  • Security certificate: $25 - $300 / year
    • Mandatory if using an integrated payment method

Charging admission for events

Things to consider when charging admission for events through your website:

  • How will confirmations be handled?
  • Will there be multiple ticket prices?
  • Will you be processing ticket sales at the event or will everyone be required to pre-register?

How will confirmations be handled?

If confirmations are emailed to your users, you should also provide an alternative place through your website for users to access confirmations in case their email is lost.

Will there be multiple ticket prices?

Having multiple ticket prices greatly increases the complexity of the admission process.  Because the user has the ability to purchase tickets at multiple levels, there is no real way to prevent users from purchasing lower priced tickets, unless you can specify that certain levels of tickets are available based on the user's logged in options.  When associating a ticket price for an event, be sure that each price level has a unique code which will make tracking and reporting much easier.

Will you be processing ticket sales at the event or will everyone be required to pre-register?

It is much easier to use an event admission system that allows you to both manually register users by purchase as well as for free, if paying by a method not accepted through your online system.  This will ensure easier management because you can track all attendees and registrants through one system.

Planning on selling digital products?

If you are planning to offer digital products there are a few key questions to ask yourself:
  • How will you distribute the digital product after it has been purchased?
  • How will you protect your digital products from un-authorized downloads?
  • Should you limit the amount of downloads of a purchased product?

How will you distribute the digital product after it has been purchased?

There are really three methods you can go about distributing your digital download once it has been purchased.  One is manually sending out the digital product to the user after purchase, another is to have a program automatically e-mail the digital product after purchase, the third and best way is to have the user download the product from a location.
 
When using email as a method of distribution you do not have to worry about bandwidth usage during the transfer.  With the low cost of bandwidth, (many economy hosting plans include at least 5,000 GB of transfer) this is not a very strong advantage.  Relying on email as distribution you are counting on the fact that your attachment will always get through.  This can present problems if the user's spam blocker does not allow your attachment through.  You may also find that the size of the download exceeds the maximum size allowed by your email provider or the user's email provider.
 
Providing access to the digital product via download is the best way to distribute if done correctly.  However, issues arise when considering how to protect the digital file location from unauthorized download. 

How will you protect your digital products from un-authorized downloads?

One method is to use a scrambled URL.  Your security is compromised if someone shares this URL with another or posts the URL across the web.  You could keep changing the URL regularly but this could become an administrative nightmare, especially if you have many products. 
 
The best way to protect your digital products is to not worry if the file location becomes well known.  The way to not worry is to have an interpretation program that performs the following steps:
  1. Check that the file location is valid.
  2. Check that the user has access to the file via purchase or permissions.
  3. Start the download process if access is given, or direct the user to a page indicating "unauthorized access" if access is not given.
The "unauthorized access" step is as important as the successful download for those users who should have access, but may have forgot to login so that permissions or purchase history may be checked.

Should you limit the amount of downloads of a purchased product?

Yes, you should limit the amount of times a user can download a purchased product.  This will help prevent users from publishing login information to an account on your website that would give the whole world access to your property.  When the user has a download limit per file, this method becomes useless.  To be safe, you should never set the limit at one in case there is a download error.
 
If you are using a management program to monitor digital downloads you should be able to manually override or reset the download limit for any user if there becomes a problem.

Recurring membership dues and subscriptions

Things to consider for recurring transactions:
  • What features do you need to process recurring transactions?
  • Using a trial period to increase sign-ups
  • How will users unsubscribe?

What features do you need to process recurring transactions?

Most merchant account services are capable of storing financial information and processing recurring transactions once the details have initially been setup.  Your e-commerce management system must be able to communicate with merchant service to setup the recurring transaction.

Using a trial period to increase sign-ups

It is much easier to sign-up for free than to remember to cancel.  Giving away a period of trial access can give exposure to your privileged content and generate more initial customers.  Customers are more prone to try something for free and forget to cancel, than to commit to an expense immediately without seeing the benefits of their investment.

How will users unsubscribe?

Make it easy for users to unsubscribe.  When a user is in the unsubscribe process ask exit questions such as "your reason for leaving" which will give you great feedback to cut down on additional users leaving for the same reasons.