How to Budget for eCommerce

Budgeting for Internet Marketing in 2018

The 5th post in our series of blogs related to Internet Marketing is for those who are contemplating going eCommerce in 2018. We see this on a regular basis…companies that have a defined set of products but have not taken the step to either feature or offer them online. The reasons for holding back are often fear of the unknown, concern over the amount of work that will be required or a belief that it’s not possible. In this post we’ll dispel some of the concerns and hopefully answer some of your questions.

In the paragraph above I intentionally said “feature or offer”. You don’t have to actually offer your products for sale online to benefit from an eCommerce site. Think of an eCommerce site as a framework.  It’s a means to showcase your products in an organized and economical way.

Here’s an example. We’re working with a company right now that sells cranes. These are the “big” cranes, and no one expects a website visitor to transact over a million dollars online for a crane purchase. There are roughly 50 models of cranes in their portfolio. Rather than designing and publishing 50 unique, static pages of content to showcase the cranes, we’re building an eCommerce site that features each crane as a sku. This framework makes it much easier for the crane company to update specs, add a new crane or obsolete an old model.  It also allows a site visitor to look at their models and filter based on important criteria like load, length, reach, etc.

Another example is a CNC machining company that is a long term client of ours. In addition to contract manufacturing, this company has a proprietary line of diaphragm valves and fittings for modular gas panels. This company does not sell anything online as every project is quoted individually. However, we took the time to create skus for every conceivable size, material, surface finish and configuration and loaded those skus into an eCommerce framework to allow the company to showcase the breadth of their product. The end-result? They went from 0 products “online” to over 1.8MM skus at launch and the company now has a site that fully represents the scope of their capabilities.

Launching an eCommerce framework is not scary once you know what you’re up against. It has great advantages for your online presence and is worth the investment of time. The biggest requirement is simply that you have to organize your data.

Launching an eCommerce site requires your developer to have a database of all of your products. An excel spreadsheet will typically work great. A unique sku is needed for every product, along with a short and long description and an image file (or image files). If you intend to sell online we also need a price, and a weight for calculating shipping is helpful. If not selling online, you can skip price and weight. If you have specifications for each sku, those also need to be included. Getting your data organized is the most labor intensive part of the project. A good engineer may be able to do this with excel macros and “concatenation”.  Your developer should guide you in this process, as we’ll help you think about “categories” and “attributes,” which also needs to be included in the dataset of skus.

If you already have your product data in a database (for instance your back-office system) your developer needs to look at the data to see how it’s organized. Don’t assume that your data is “good” just because you have it. The organization of the data is critical and it may need to be manipulated for it to be loaded into an eCommerce framework. But if you already have the data organized, you’re a step ahead of the others.

The next important consideration in an eCommerce framework is integration with business processes and systems. Do you have an ERP system, and if so, will the two systems be integrated? Where do we get inventory levels? Does an online order result in a simple email to you, or does it need to arrive in another platform? The answer to these questions is a major driver of time and budget. If you’re not transacting online and the site is on an island to itself, no problem. But if we need to integrate for order placement, shipping information and inventory levels, we need to carefully design a “system” that works for your business. Don’t let this scare you…it’s done all the time. It’s just a complexity with a series of questions that require answers.

Budgeting for Internet Marketing in 2018Once we’ve scoped data and integration, the rest of the site will come together pretty easily. The site needs to be designed to provide an easy “user experience” that quickly gets a site visitor to the product of most interest to them. That’s the beauty of an eCommerce framework…we can use categories and attributes to quickly move a site visitor to their desired destination. If you’re selling online, we also need to establish a “merchant services” account to capture credit card information and deposit sales to your bank accounts. If you’re not integrating with a back-office system, your developer should work with you on manual steps to manage inventory and order placement.

If you haven’t yet made the transition to eCommerce, you should definitely take the time to scope it out for your business. Particularly if your competitors HAVE. You can barely read the news without seeing reports of how eCommerce is devastating brick and mortar businesses. And B2B eCommerce is the fastest growing segment, so don’t think that because you’re B2B you don’t need to make the transition. At Magnetic North, we do more B2B eCommerce than we do B2C.

If you have a defined set of products that would benefit from the features of an eCommerce website, give us a call and we’ll work with you to establish a budget for your project. We’ve built a detailed, 3 stage process to define a budget, price and timeline for eCommerce projects.

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