e-commerce The beginners guide

Transcription

1 e-commerce The beginners guide

2 There is a worldwide trend showing that more businesses are moving online to address the changing need of the online consumer. South Africa is rapidly catching up as we see fast growth in online purchasing and the increase in access to the internet. The question in the minds of many traditional retailers, entrepreneurs and business owners is whether or not their products and services are suited for online sales and marketing. For small businesses, growth is often achieved through the identification of new markets and acquisition of new customers. E-commerce is an excellent opportunity for companies to extend their sales reach to a world of new customers in a way that was once unimaginable. Selling your goods online can also be considered a great equaliser, because of its ability to level the playing field against larger competitors. It is with all of this in mind that Nedbank has identified the need to provide holistic services to their business customers to enable them to both understand and benefit from the opportunity in e-commerce. This Beginner s Guide to selling online will walk you through everything you need to know about taking your existing business, or starting a new one, online. In just a few easy steps, you will see that targeting the online customer is not as complex as it seems and there are tools available to make this journey even easier. Although the benefits of e-commerce includes a large numbers of potentials customers and lower company infrastructure costs, many small business owners are hesitant to start selling on the Internet due to a lack of understanding of the landscape and resulting concerns about cost, security and technology. INTRODUCTION Electronic commerce, or e-commerce as it is commonly known, is the industry of buying and selling of products and services online. 1

3

4 Assess Business Suitability for e-commerce Whilst e-commerce is a phenomenal opportunity for business owners, some products are better suited to being sold online than others. Here are a few questions to serve as guidelines to determine whether you should consider e-commerce for your business: Is your product easy to understand for your online customers? Remember, shoppers will not be able to touch or try your product. To make the purchase decision, they need to be sure they know what they are getting. Providing detailed product descriptions and photographs can increase your sales significantly. A clear returns policy, product guarantee, or positive ratings and reviews may also help to build trust and reduce the apprehension some buyers feel when considering an online purchase. Can you sell the product at an acceptable profit margin once you factor in the time and expense of packaging and delivery? If you sell low-ticket items, you may need to sell in bulk to increase profits. If you sell perishable items, you will need fast delivery and adequate packaging. Do you sell a service or digital (not physical) product that can be delivered efficiently online or via ? Many information or service suppliers have made seamless transitions to the Internet, for example, converting magazines to digital editions. Does your product appeal to customers outside of your geographic area, or will selling online enhance your service to your existing customers? For example, if you re selling tickets to a local sporting event, someone that s several thousand miles away probably isn t going to be interested. But that doesn t mean your neighbours won t appreciate the added convenience. If you determine that your product offering is suited to online sales, we hope you ll follow the steps in this guide to get started. Nedbank has established relationships with select partners to assist you in getting started with the process of taking your business online. 3

5 Select and register your website address.co.za.com.net.info.org.edu The first step you should take toward establishing your business online is to obtain a website address, which is also referred to as a domain name or URL. If your obvious choice is not available, you may need to be creative in coming up with an alternative domain name. Be careful, however, as you will want to avoid confusion with similarly named companies. To check which domain names are available visit: Domain names comprise your unique name and a top-level domain (TLD), which are the three letters that follow the final period in any URL. The most common TLDs for domestic businesses are;.co.za.com,.net, and.biz, while non-profit organisations typically use.org. In order to further protect the exclusivity of your website address, you may want to consider registering your unique name for each TLD. Domain registration sites allow you to register your domain from one year to 10 years. 4

6 Build your site Building your site can be the most difficult task associated with getting your business online. Fortunately, however, you have several options: $ Do It Yourself Business owners with web expertise and the necessary resources to design and develop a website can use a variety of website development tools to build an e-commerce platform. While this is the most labour-intensive method, it is often the most cost effective and also provides the most flexibility. There are numerous software programs available to provide flexible and intuitive website templates. $ $ Purchase a Web Store Builder Web store builders allow you to quickly create your own e-commerce website that accepts credit cards by customising existing templates through easy-to-use software or a web interface. Some web store builder software includes a suite of solutions that provide you with everything you need to get started and useful store management tools such as Web hosting, a shopping cart (automated checkout pages), credit card processing, inventory control, customer relationship management (CRM), site visitor analysis and management. Web store builders typically charge a monthly fee for their range of services and pricing can vary greatly. $ $ $ Hire a Web Designer/Developer There are numerous highly skilled, local and international web design and development companies, if you wish to make use of a specialist service provider. Having this provided by a professional has obvious benefits, though this route is often the least cost effective and prices will vary from supplier to supplier. Not all websites are designed to work with online payments. Nedbank has created relationships with a panel of pre-approved website developers to ensure you get the best fit. 5

7 Host your site A web-hosting company enables you to make your website accessible via the Internet by providing space on a server, internet connectivity, management and other services related to running an online business. However, there are several factors to consider when searching for a web-hosting provider. For the average small business owner, the most important capabilities a hosting service can provide are reliability and flexibility at a manageable cost. You want your website to be available on the Internet at all times, so your host must be reliable. When you want to make changes to your site, your host must be flexible. Additionally, your host should provide multiple ways for you to be able to reach customer service during reasonable hours. Most hosting providers offer numerous service plans depending on the size of your site and the amount of traffic it is likely to receive. Look for a plan that allows you to start small and grow as your business grows. Expect to spend a once off cost followed by additional monthly hosting fees depending on the size of your website, traffic you receive and the service options you select. Additional options, which you might consider, include: Extra addresses Site statistics for tracking visits to your site Site Extra statistics storage, for tracking preferably visits 50MB to to your 200MB site Shopping cart capabilities Customer support Nedbank takes the hassle out of sourcing the best deals for website hosting and has established deals for web hosting to cater for all types of website needs. 6

8 Accept Online Payments Now that your site is ready to go, you ll need to give online shoppers the ability to purchase your products or services. To get this next step underway, you ll need both a merchant account and a payment gateway account. Merchant Account with Nedbank All you need to do is create a merchant account in order to collect payments when purchases are made online through a consumer s bank account or credit card. If you re already selling products from a retail location, you probably have a merchant account already. However, to sell from your website, you ll also need a Card Not Present (CNP) merchant account, which can be attained by signing an agreement with your bank. PIN **** Nedbank provides a merchant account enabling you to receive payments via the internet in situations where the consumer is purchasing virtually or where the card is not present at the time of the transaction (e.g. Over the telephone) Payment Gateway Account Payment gateways, provide the necessary infrastructure that enables merchants to accept credit card and electronic check payments from websites, mail order/telephone order (MOTO), call centers and even retail and mobile locations. In other words, an online payment gateway virtually replaces the traditional credit card swipe machine you find in the physical retail world. It captures your customers payment data and securely communicates with the appropriate financial institution to process and deposit proceeds into your merchant account. As a Nedbank merchant you automatically get this account for free In addition to the core payment gateway service, you need to have the ability to accept and process electronic cheque payments directly from your website. There are solutions in place to assist in processing these online transactions, preventing online fraud and helping you to filter any suspicious transactions before shipping a product and risking unnecessary chargeback fees. Nedbank has a host of value added products and services allowing you to process online payments and Advanced Fraud Protection to secure your online business 7

9 Credit Card Payment Flow The credit card payment process consists of two phases: authorisation (determining whether payment information is valid and funds are available on the customer s credit card) and settlement (the transfer of funds into the merchant s account). Authorisation Steps 1-10 in the below diagram represent the authorisation phase. The bank routes the payment details to the credit card networks on behalf of the merchant, then returns the results approved or declined. Settlement / Funding Steps in the below diagram represents the settlement phase, sometimes referred to as funding. The customer s credit card issuing bank sends the appropriate funds for the transaction to the merchant s bank. The bank then deposits the funds into the merchant s bank account, typically within a business day or two D SECURE CYBERSOURCE 9 BUYER SELLER 2 PAYMENT GATEWAY ISSUING BANK ACQUIRING BANK PROCESSOR CREDIT CARD NETWORK 8

10 Promote your Website Once you ve built your website, hosted it, and are accepting payments, it s time to promote your site and drive customers to your new online store. Since it is impossible to include all the ways to market a website effectively and successfully, here are a few cost-effective, online tactics: Search Engine Optimisation Research Structure Analyse rankings and traffic SEO Keep Improving On-Site SEO Link Building Search Engine Optimisation (SEO) is a term used to describe the marketing technique of fine-tuning a website to improve its placement in the search results for internet search engines such as Google and Yahoo. Getting your website at the top of search engine results greatly improves your chances of a shopper visiting your site. There are two factors that determine unpaid search engine results: 1. Traditionally, SEO refers to modifying the content and structure of a website s text and page layout to improve the relevancy of your Web pages content to searched keywords. This is a free technique you can perform on your website. Once your pages are optimised, you submit your site for inclusion in search engine results. 2. Link building is a more complex SEO technique that attempts to increase ranking in search engine results by increasing the number of links to your website across the Internet, thus increasing the importance of your website as perceived by search engines. Many search engines view links to a website as votes for the importance and relevance of that website, and they display more important sites higher in their results. For this reason, it is essential to establish relevant, quality inbound links to your website from other websites. Link building can be free or paid, depending on the internet directory or website that provides the link. 9

11 Pay Per Click Advertising Pay per click (PPC) advertising refers to advertising on internet search engines. You pay a PPC service to have your ad appear when a chosen keyword or phrase is searched. Typically you are charged a fixed amount each time a shopper clicks your ad. The price of a PPC ad is usually determined by the competitiveness of the keywords you choose and importance of the search engine on which it appears. The ads normally appear under a heading such as Sponsored Links. Social Media Reaching customers directly through social media websites such as Twitter, Facebook, LinkedIn can becost-effective strategy for small merchants. These sites and other social platforms allow product announcements, promotions and even conversations with customers to take place without requiring a web development team or large staff complement. Offline Marketing For offline marketing, ensure that you include your web address in all of your printed material such as advertisements, business cards, stationery, yellow pages listings and anywhere else your business is mentioned. If you have your customers addresses, send them an announcement when your website goes live so they know they can now shop at your online store. 10

12 Manage your business To help your online business grow, you need to effectively manage transaction security, financial accounting and product shipping, while proactively guarding your business against online fraud. Nedbank will provide you with a suite of products and access to selected partners to take your business online and grow it. This ebook has walked you through the steps you need to follow and the tools you need to have in order to take your business online. Each of the components highlighted can be provided as part of a holistic solution, or even as separate components to enable you to upgrade or enhance your current online website presence. By now you should already be more aware of what it will take to sell your product or service through a website. In addition, there are some specific tools that would further enhance your capability and these can be included in your e-commerce merchant toolkit. SECURITY SERVICES 3D Secure and Cybersource ACCOUNTING You need a fast and simple invoicing system BUSINESS PRODUCTIVITY If your business re-bills customers on a regular or semi-frequent basis there is a solution to help customise your experience CUSTOMER INFORMATION MANAGER (CIM) Nedbank can provide you with PCI DSS advice Following all of the easy steps in this guide should enable you to make e-commerce happen. For further assistance contact Nedbank on or visit so we can help you in taking your business online 11

13 Nedbank Headoffice 135 Rivonia Road Sandown Sandton 2196 PO Box 1144 Johannesburg 2000 South Africa Web: Nedbank Limited Reg No 1951/000009/06. Authorised financial services and registered credit provider (NCRCP16). Published October 2012