Elements of an E-Commerce Site

By Kamal Haddad on 28 October 2016

The components of setting up and managing your website well

by Kamal J. Haddad

This article will focus on the components involved in setting up and managing an e-commerce website, as well as some available options for finding the right service providers. The objective is to gain a better understanding of the elements of an online store, what their purpose is and how they work together—everything from finding the right suppliers, pricing contracts and MAP Pricing to customer service, hosting options, site security, customer reviews, social media marketing, keeping the site updated and the amount of staff time and expertise required to run it properly.

Assuming you place a high value on your time, then you need to keep that in mind when comparing your options. For the purposes of this article, I will stay away from enterprise-level e-commerce websites and focus on the small- and medium-size HME dealers who are not willing to spend hundreds of thousands of dollars or devote a full staff to enter the online arena. The target audience for this article is the dealer interested in using e-commerce to complement existing business. That means finding the right place to host your website, making sure your website has true e-commerce capabilities, finding the right mix of products to offer your customers, making sure your site is current and making sure your customer service is meeting or exceeding expectations.

1. Hosting

Your site should be hosted with a reputable hosting company with reliable service and the ability to handle spikes in traffic due to promotions or seasonal sales. Costs will vary from free hosting (which I do not recommend) to $10–$50/month. Keep in mind that this is typically for a main hosted website with no e-commerce capability. There are a number of service providers that offer template-style websites with decent options for specific industries, if that is what you are looking for. Because we are focusing on e-commerce, I want to discuss hosting options that include e-commerce—or, at a minimum, e-commerce options that can work within an existing company website.

2. E-Commerce

Once you move into selling online, you must find a hosting company that specializes in e-commerce and offers a shopping cart as part of their hosting service. There are many shopping carts you can use from free or “open source” providers such as Magento, but you still need to host the website somewhere. I am personally not a fan of free anything and believe you always get what you pay for. Either way, you must make sure your site is secure with a Secure Sockets Layer (SSL). That is the standard security technology to make sure that all data passed between the web server (your online store) and browsers remain private and integral. You must also have a store that is PCI-compliant so the credit card data you collect from online customers remains secure. It usually costs $75–$400/year for SSL. Your credit card processor will usually monitor PCI compliance. Once you determine which payment processor you are using to accept your customers’ credit cards, you will find the PCI compliance monitoring is included in your monthly fee of $15–$40/month.

3. Product Catalog

A successful e-commerce store needs to have a great selection of cash sale items and your customer or your staff must be able to research, select and finalize a purchase within your e-commerce store from a computer, tablet or smartphone. When selecting products and manufacturers, you want to include items that complement or upsell the services you offer and improve the care and lifestyle of your customers (or, as Mike Sperduti calls it, “up-caring”). Keep in mind, in a fiercely competitive online marketplace, it is critical that the prices you charge are consistent with average “street prices.” What does that mean? If you sell a walker on your website for $100 and that same item is available on Amazon for $60, you have a problem—and chances are your customers will let you know about it.

To avoid these issues, you should work with manufacturers that protect their brands online by either implementing a Minimum Advertised Price (MAP) Policy or leaving enough margins for dealers that allow them to compete. Many Medtrade exhibitors, such as Core Products, Principle Business Enterprises and SP Ableware, are examples. Purchasing through a buying group contract or a reputable distributer willing to offer profitable lines is essential. In any case, online pricing is fluid and you need to keep an eye on price movement in the marketplace. Currently, there are service providers that will setup and host your e-commerce store, including a nicely stocked catalog, for as little as $100–$400/month.

4. Management

Once the site is running, you need to decide if you are stocking and shipping the orders that are placed online, or if you are sending these orders to a drop-shipper to have them fulfilled. What amount of your staff time and business space are you willing to commit? Assuming you are not going to stock and fill orders, there are options for passing that order directly from your e-commerce website to a supplier. At a minimum, someone will need to make sure pricing and stock availability is accurate, that orders get to the supplier, shipments get out quickly, tracking information gets to the customer and questions from customers are responded to in a timely fashion. Even though I am targeting e-commerce, I still want to point out that, in addition to e-commerce transactions, your business website has many components that also require attention from your company—“About Us” pages, maps and directions, “Pay Bill Online” links, etc.

A little later, I will get into hosting and cart services that work with product vendors to provide a more comprehensive service that includes preloaded catalogs as well as fully managed e-commerce services.

5. Marketing

“If you build it, they will come,” does not apply here. Whether you build a site in-house, use an outside agency to build your site or use a hybrid or fully managed service, all three are almost useless without a plan to properly train employees to drive interest and customers to the site.

You may be able to partner with a service provider to setup, build and even maintain your e-commerce website, but you need to understand this site is designed to support your in-store efforts. You should be talking about these cash-sale items in-store, in your brochures and mailings and eblasts to customers, and even asking questions when you are face-to-face or on the phone with them. This may also include posting information on blogs and social media, as well as using local directories and reviews to get your business noticed in your community and found online.

While some services such as website updates, social media and blog posting and search engine optimization (SEO) can also be outsourced, nothing is more beneficial than properly trained staff that expose your customers to the new online research and purchasing options.

The reality is that 75 percent of consumers have a smartphone, and a majority of them research and/or shop online using their mobile devices. Consumers expect a lot from you in terms of researching products and buying online at the right price. And if you don’t give them what they want, they go elsewhere. You have a huge upside in turning your expertise and patient relationship into new forms of revenue.

So, my suggestion is to find a way to get into e-commerce. If you do not have the time, staff or expertise, find a provider that can setup, host and maintain your website. It is easier, more efficient and probably more profitable if you partner with someone who can handle many of those tasks for you for as low as several hundreds of dollars per month instead of taking on the entire burden in-house.

Tasks that can be outsourced today include full catalog management, relationships with drop-ship partners, SEO services, blog posts, email marketing and social media interactions with customers, as well as fully managed e-commerce services. You do not even need to use the same provider for all of these tasks. There are companies that just do email marketing or blog posts or offer SEO services, and they do it well. You may find it efficient to handle some or many of these tasks in-house, and then work with experts on the areas in which you are unfamiliar to help you achieve your online sales goals. Whatever your final choice is, make sure you find a way to do e-commerce in some capacity so you are not left behind.

This article is the third in a four-part series. Each segment will focus on best practices for building e-commerce sales.

Kamal J. Haddad, CPA, founder and CEO of Health Mobius LLC, is an entrepreneur and well-known expert in the health care technology arena. He has a proven track record generating revenue through applications that integrates the care process and patient compliance with retail sales. For more information, visit healthmobius.com.