3 Things I Wish I Knew When I Started My E-commerce Business

Starting your own e-commerce business is the ultimate dream for any entrepreneur.

Just picture it: working whenever you want, from wherever you want, doing what you love the most. And the money you can make too!

I was told that I only needed to do a few simple things, and the money and freedom were mine to enjoy, just like many other people have been led me to believe.

Unfortunately, things didn't work in such a simple set of terms.

You need to work a lot.

You need to know what you are doing.

And most importantly, you are on your own.

If you succeed, it’s all on you. But so it is, if you fail.

I won't lie, I made a nice amount of money thanks to my e-commerce store, and I learned a lot of great things. But the most interesting and useful insights I gained didn't come from the good things, but from the bad ones.

For this reason, in this article I will share with you the 3 things I wish I knew before I started my own e-commerce store.

Important Note: I won't be mentioning my store’s name because it uses drop shipping as its main fulfillment method. This means it's easy to copy and steal my business' practices and customers.

Research can make or break your store

Learning #1: Starting an e-commerce store is easy. Knowing what to start is not.

Picking the right niche in the right industry can guarantee an easy start or a rough one. It’s the difference between someone, who for some reason can’t make enough sales, with someone who starts making thousands of dollars in sales right from the start.

In order to pick the right niche, you need to research a lot.

This research can be as extensive and complicated as you want it to be. Honestly, I prefer starting with a simple research process that can help you cover all the bases to get you started.

The research process looks like this:

  • Start by searching in Google Keyword Planner for relevant keywords (I have a background in SEO, to understand my obsession with keyword research). Export the list and analyze trends and search volumes.
  • Put the most relevant and most-searched keywords on Google Trends.
  • Search on Amazon for products and analyze comments. You can find many amazing insights from comments; from what customers love about a product to what they would change. I actually found the name of my store thanks to one comment that inspired me.
  • Search through Reddit for relevant subreddits, and analyze comments and upvoted submissions.
  • Search in Quora for questions, which can show you what problems people have - and answers, which show you what solutions exist.
  • Read influential blogs to see what people like talking about.

All this research should give you hints of what your niche is all about. I explain my research process better in this article I wrote for A Better Lemonade Stand.

My Experience

When I picked my own store I didn’t know anything about my niche. I picked it for the dumbest reason: I started yet another private label business in Amazon. If you don’t know what an Amazon private label business is, this business consists of sourcing a product in China, manufacturing it, importing it, and selling it on Amazon as a third-party seller. It can be a great business if you know what you are doing. The problem was, I didn’t know what I was doing.

My supplier ended up being a mess, missing the production deadline for over 3 months. I had invested $10k and for months I didn’t have anything to show for it. That was money I could have spent doing something else, like promoting my business (something which I will explain later). Also, the niche of that particular product ended up being way too saturated, which lowered my chances of succeeding.

While my product was being manufactured, I figured I should start an e-commerce store and see how it goes.

That was my whole reason to get started.

Truth to be told, it was a good enough reason, as I didn’t have anything to lose. What made things even better was that I had decided to use drop shipping as the fulfillment method. This meant I wouldn’t have to buy any stock upfront, saving my business a lot of money.

The problem was I did my research after I had made the decision of starting the store. Yes, I learned a lot about my market, only once I started researching for companies to drop ship and what products to sell. I also learned a lot about my customers once I had to start creating content to promote my store. But all this learning was done after, not before I launched my store.

I should have known better. Starting an e-commerce store without a clear idea of your audience and the problem you are trying to solve is a recipe for endless frustration, some of which I was about to learn afterwards.

What I Did Right:

  • Finding and opening an account with the drop shipping companies.

What I Did Wrong:

  • Researching after launching.
  • Not asking questions to influencers or to the community to discover needs and problems.

What I Would Have Done Differently:

  • I would have thought twice before picking my niche (which is in the home & kitchen), since it doesn’t touch a big need or solve a problem.
  • I wouldn’t have chosen my Chinese supplier, which ended up being a mess.
  • I wouldn’t have chosen the amount of products I chose before launching, which delayed the launch.

It’s all about differentiation

Learning #2: Starting an e-commerce business is easy, getting people to care is not.

If you do your research perfectly, you have won almost half the battle.

“Almost?”, you may ask. Yes, because there’s still a piece of the puzzle you need to figure out before you launch your store.

That piece is called differentiation.

According to RJmetrics, as of 2014, there are 110k stores making significant money. Differentiating your store from these thousands of stores out there is the only way to survive in the current e-commerce world.

Do you want to sell shoes? Well, guess what? There are probably at least 5000 stores selling the same kind of product that you want to sell.

Do you expect to compete only on price? Good luck making any money with AliExpress' drop shippers and Chinese counterfeits.

In order to differentiate your store, you need to understand the, what I like to call, “e-commerce trifecta”:

  1. Understand your customers
  2. Understand your market
  3. Have a great offer

First of all, to understand your customers, you need to put yourself in their shoes. That’s why so many people recommend starting an e-commerce store in a niche you are into yourself. But even if you don’t belong to your market niche, you should at least follow some of the tips I shared earlier.

Research is the only way to understand your customers.

The same goes with your market. You will develop a great understanding of your target market if you have ever shopped, are interested, or have worked for a company in that market. But even if you don't, researching your competitors will help you get a deeper understanding of the market and what you can do to stand out.

Finally, by having a great offer you will be able to get people to care. You can’t know for sure what a good offer is and what’s not. But as a rule of thumb, if you don’t know to who you are trying to sell your products, your offer is doomed to fail.

Your offer (ie. your products) has to have three attributes to be able to stand out:

  • It needs to solve your customers’ problems
  • It has to be in a good price range
  • It must be of good quality (at least in relation to the price).

If your offer has these three attributes, it will stand out and your store will succeed.

My experience

Despite not doing a great job of researching before launching my store, after weeks of talking to suppliers, reading blogs and analyzing my competitors, I ended up having a good understanding of my target audience and market.

As I mentioned before, this research led to the realization that the problem I was aiming to solve wasn't a big one, and that many people don't care much about it either. There was still a small audience of people who are passionate about this niche, and I decided to aim for these people.

The main way I used to differentiate my store was storytelling. I created a unique "About Us" page that explained and pictured my customer's situation, expanded their problem to agitate it, and explained how my store can help them solve it.

Another thing I did was create amazing product descriptions. All stores except for one used the same awful descriptions. It took me a lot of hard work, but I ended up creating unique product descriptions for each of the +150 products I sell on my store. I also added recommendations for each product to give a more personal experience.

These two things helped differentiate my store with the other dozen companies selling the same products my store sells.

Remember this: you either differentiate or you will be ignored.

What I Did Right:

  • Creating a story.
  • Focusing on the problems and needs of the customers.
  • Creating amazing product descriptions.
  • Focusing on the value of my products.

What I Did Wrong:

  • Not having an expertise in the industry lowered my credibility and made it harder to create the descriptions.

What I Would Have Done Differently:

  • I would think about partnering with an influencer to sell my story better.

Once you get started, you need to attract the right audience

Learning #3: Launching an e-commerce store is easy, getting people to visit your store is not.

You can research and differentiate yourself perfectly, but if no one is aware of the existence of your store, you won’t make any sales.

The only way to make sales is by promoting your store. The better you promote it, the more sales you will make.

If you are an active participant in your niche, it won’t be that hard to start promoting your store. You can do things like writing a blog, participating in events and leveraging your expertise on online communities, among other things.

But if you aren’t already participating in your niche, which was my case, you need to use research to get inside your customer’s mind. Before you start promoting your store, you should be able to answer the following questions:

  • Where do your customers hang out?
  • What content do they consume?
  • What blogs do they follow?
  • What do they like talking about?
  • Who are their influencers?

If you’ve done your research, you should already know the answer to all these questions.

For example, if you cater people who follow the ketogenic diet, you know they probably read Read.Me, one of the largest keto diet sites. You also know they like hanging around in the/keto/ subreddit, and like sharing recipes and tips.

This kind of information will help you understand what kind of content you need to create, with whom you should try to partner, and a lot more.

As you probably know, I didn't know have all this information before launching. Fortunately, I found two channels that worked great and helped me make my first few sales: Google Shopping and Facebook Ads.

These two channels are perfect for e-commerce stores. The former has an incredible purchasing intent — you are basically paying to get clicks for people who are looking for specific products, while the latter has a huge audience — basically, every Facebook user — with incredible targeting options.

I know you may not want to spend a lot of money on advertising at first. But if you know anything about online advertising, you know you have to spend money to make money. If you are willing to spend at least $1000 on testing, you will be able to start making sales thanks to these two channels alone.

My experience

At first, I failed miserably with Facebook Ads. It took me some weeks and a lot of trial and error to discover a great offer, a great audience, and a good ad structure. But after I did, I started making some sales. Maybe the margins weren't that good (less than 20%), but at least I was making sales.

On the other hand, Google Shopping was a home run from the start. My first few sales were all thanks to this channel, and it still makes me a few dozen sales per month. In many aspects, Google Shopping is not as good as Facebook Ads, but the traffic you get is the traffic you sell to.

What I Did Right:

  • I focused only on two channels: Facebook Ads and Google Shopping.
  • I structured and optimized a well-performing Google Shopping campaign.

What I Did Wrong:

  • I shouldn’t have invested so much money upfront before knowing how to use Facebook Ads.

What I Would Have Done Differently:

  • I should have also focused a bit more on guest posting (for SEO purposes) and content marketing.
  • I would create a different funnel, focusing on lead generation and not so much on making sales right away. That would have driven my acquisition costs much lower, although the sales process would have taken much longer.

Conclusion

My personal case isn't one of those rag-to-riches stories where I suddenly made a lot of money without much effort.

Nevertheless, launching my e-commerce store was one of the best things I’ve ever done. I gained new skills — using Facebook Ads and Google Shopping — and learned what it takes to be successful.

But here's the most important lesson of all: mistakes will happen. You will face challenges. Problems will come up.

That's a fact of the entrepreneurial life. What makes the biggest difference is how you deal with those problems. They won't go away if you ignore them, and nothing will happen if you sit around waiting for someone else to help you.

The only way to succeed is to learn and keep moving forward.


About the Author: Ivan Kreimer is a freelance content marketer that helps SaaS business increase their traffic, leads and sales. Previously, he worked as an online marketing consultant helping both small and large companies drive more traffic and revenue. He is also an e-commerce store owner, and a world traveler.