Selecting Your Ecommerce Business Model

Selecting Your Ecommerce Business Model

There are several different types of ecommerce business models and value delivery methods to choose from. Deciding on a business model can be difficult, so here are a few questions that can help you create a business plan that will set your company apart:

An advantage of the online marketplace is that there will always be a market for what you want to sell — you just need to know exactly what that is. Before a business can take off, you need to understand what is currently being sold online and what you are interested in tapping into.

Physical Products

Physical products are the most commonly sold commodity on ecommerce stores and often achieve the highest sales. From car parts to novels to electronics and gadgets, your entry into the online market won’t be difficult if you know what product you want to build.

Digital Goods

As the world moves further into a digital marketplace, selling digital goods and products has never been easier. Because of the nature of digital goods, what you can sell and how much of it is determined almost entirely by your business. Want to sell an eBook? A web design? As long as you’re not infringing on any copyrights, the world is your oyster.

Services

Another result of the broader move into the digital marketplace is how much easier selling services has become. Before online marketplaces, selling services typically occurred through newspaper ads or word of mouth. Now, service-based businesses can create their own websites to market themselves.

Furthermore, the popularity of marketplaces such as Facebook Marketplace, Etsy and Amazon allows for accessible advertisement avenues. It takes just a few clicks to find a group looking for just the kind of services you may offer.

Who are you looking to serve?

Consider the expectations of your customers when purchasing the type of new product you plan to sell. You’re most likely to succeed if you understand their behaviors and habits and find ways to improve them or save money.

To accomplish this, you’ll need to look for pain points in how things are currently done at your company. This is an opportunity for innovators to carve out a space to improve customer relations and overall satisfaction.

What do you know better than anyone else?

Build around your existing strengths and the pieces that are energizing to you. Be realistic about what elements you can do yourself and what you will need to find help for. Uncovering your limitations can be challenging, but it will help you make better long-term decisions.

What is best for your product?

Depending on your product, different models will serve you better than others. For example, if you are manufacturing your own products, you may want to consider wholesaling or subscriptions to help cover production costs and break-even more quickly.

If you are a distributor of other people’s products, you’ll want to invest more heavily into direct marketing and strategies to grow your customer base.

What is your positioning?

You understand what makes your product better, but will consumers? Evaluate your competition and make sure it’s clear why your product is the best choice.

Are you competing on price? Selection? Convenience?

Your unique value should be clear from your back-end processes, warehousing, marketing and your website’s shopping experience.

For businesses looking to take the next step into the digital world, understanding what business models to use and how to leverage them can make the difference between a successful business and one you never hear about again.

With the help of ElmMac, you won’t have to worry about the second option. Our solution is designed to help businesses build, innovate and grow — without hassle and with the help of industry experts.