In this guide, you'll find answers to the question “How much money do I need to start an e-commerce business?”
As you read further, you’ll also discover the important factors that must be considered to build a successful and profitable e-commerce business empire.
So this page will answer your question on how much to start an e-commerce business including the important factors that must be considered around this topic so you can make a well-informed decision in your ecommerce business.
How Much Money Do I Need To Start An E-commerce Business?
An E-commerce business with its setups can be started with as little as $100 if you want to start on a low budget and can be scaled up to as high as $50,000 as you grow or expand in the business.
There have been folks who started their e-commerce business from scratch with as little as $100 and scaled successfully while some started with $10,000. In all honestly, there seems not to be a direct (straight) answer to this question because of the many variables and individual objectives of this business.
Does E-commerce Business Worth It?
The first to look at here is the massive growth over time. The buying and changing habits from time to time are largely a factor for this rapid and constant rise. E-commerce at global level sales were over $1.3 trillion in 2014. Now, the e-commerce business industry is projected to be about $6.5 trillion by 2023 and beyond.
Another thing to consider is the customer demand factor. A popular research company claimed that almost two-thirds of American shoppers buy things from an online marketplace at least once a month, and the number of people who use eCommerce sites on a daily basis is growing exponentially.
But how does one tap into this multi-trillion-dollar industry?
Marketing is the life of your e-commerce business in generating more sales and driving more revenue for your business. That’s why we’ve put together 7 important tips or questions you must answer in order to market your e-commerce business successfully, as well as suggestions for what channels might be right for you.
7 Smart Questions to Ask Before Starting Your E-commerce Business
1. Where do I start?
With so many options available today, it can be hard to figure out where to begin — let alone how to create a strategy that’s both strategic and tactical. You might have heard advice about focusing on SEO or PPC or content marketing for an e-commerce business, but figuring out which channel makes sense for your company is often not as simple as choosing one at random.
The first step in starting an e-commerce business is to properly investigate your business idea and be able to create a product that meets a customer's needs.
Find a problem or a challenge worth tackling. What problem or challenge are you looking to solve? Who feels that pain point the most? Who would be most excited by you solving this challenge? Finding a problem worth solving is critical because even the most inventive ideas might fail if they don't have a potential customer base to sustain them.
2. How much time will it take?
More and more businesses are now realizing the importance of content marketing and social media as effective ways to market their products. 90% of marketers using social media for business said they increased their followers in Q1 2016. 72% said they use content marketing to build relationships with customers.
Consistent, high-quality content not only helps you connect with potential customers, but it also allows search engines (such as Google) to better understand your site and improve rankings. For instance, if you like what you see on someone's social media page, why not check out their website and learn more?
If you want to create quality content about your product or service, you can hire a professional writer (or freelancer) who has experience using content marketing to promote retail brands. Ask them to come up with new ideas based on business, and fan feedback and make sure they regularly research product names so you can capitalize on emerging trends.
3) What platforms should I use?
As part of your e-commerce marketing plan, consider what platforms make sense for your business. If you're selling tangible goods or want to focus on in-person customer service, a site like Etsy might be right for you. For digital products and services, websites like 99Designs or Fiverr may be better fits.
Make sure the platform(s) you pick to base your e-commerce business on support your unique brand objectives. Start by figuring out which platform(s) are best for your product. There are many ways that even seasoned entrepreneurs forget about important details. Being everywhere means nothing if no one can find you, so make sure you're on top of the latest developments in e-commerce.
If you're going to release a new product, it's important to think about how it will be used. Will it have multiple uses? What's its primary function? Can customers replace it easily? If so, you might need different versions of your product for different markets.
4) What type of content works best?
There's a huge potential market out there for new e-shop owners today. Over a million people open Etsy shops, and 800,000 start Amazon seller businesses every year. List posts rank highest for keywords in Google, so create a list of tips for marketing your e-commerce business.
Make sure you have all of your SEO in place so that customers can find you as soon as possible. The sooner they find you, the quicker your brand to gain popularity through social media and word-of-mouth. E-commerce content works really well because it uses easily discoverable information that isn't so subjective. If you need a good SEO content writer, you can search and get the best writer right here
5) What resources do I need?
Aside from thinking about how much money one needs to start an e-commerce business. Whether you are starting on a low budget or not. Here below are a few questions and tips to ponder for success in your e-commerce business.
- Decide which social media channels you're going to use and how you're going to market your product on those channels.
- Know what type of budget you have to work with, then figure out what tools (technology) you will need in order to execute your plan and achieve your goal for success.
- Have a point of view about who your audience is and how you can market products effectively towards them.
- What are you trying to accomplish by spending time on marketing your e-commerce business?
- How much time do I have?
- When should I start?
- Start small, think big – You don't need an enormous amount of money or big connections to get started, especially if you're just starting out in e-commerce – just some basic technology & resources and maybe someone to bounce ideas off!
- What resources am I able to share with other companies/entrepreneurs that may be looking at marketing their own e-commerce businesses as well?
- Find partners – people that know something that they can teach me that would be beneficial.
- Develop relationships!
6) Who should I reach out to?
When it comes to marketing your business online, you can't go wrong but you should try to avoid cold calling potential customers, this approach doesn't result well most times. A better approach will be to use social media and email. Look for influencers who might be interested in doing a product or service review.
Another approach is to think about what your target audience would look for when trying to find a solution to a problem. Even if they don't result in a sale, you can use those terms in Google AdWords to increase your exposure; click-throughs are a free way to learn how people are looking for answers, which can help you come up with improvements. Additionally, it reveals the internet hubs of your target market so you can go there and interact with them and attract their attention.
7) How will it all come together?
What sets your company apart from competitors? What makes it different from similar products? Before you can create an effective plan for marketing your e-commerce business, you need to know exactly what you’re planning to sell. Start by breaking down your product or service into its core components.
What distinguishes your product from similar products? What advantages does it provide to customers? By knowing what makes your business unique, you may employ marketing strategies that are tailored to showcase your advantages over rivals and promote your strengths.
If at all possible, consider getting the opinions of trustable friends or family members about your business. Do they have any particular memories or associations in mind? Their feedback can help shape an e-commerce marketing strategy that positions you as a thought leader in your industry.
Summary About How Much Money Is Needed To Start An E-commerce Business
I hope you enjoyed this guide answering the question about “how much money do I need to start an e-commerce business.”
As you have discovered, an e-commerce business can be started even on a low budget. An individual who is ready to grow big and has factor few points mentioned above would be able to have an idea of what to spend.
However, if you want to test the water, try with a few bucks but it is expected to scale as you expand your business. Need professional help in starting your e-commerce business or do you want to hire e-commerce expertise? Click here to hire the best