Preston Pilgrim
Author Preston Pilgrim
Digital Marketing PM
Posted in Digital Commerce
September 13, 2016
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Why Market Size Doesn’t Determine Your Ecommerce Platform

There are a lot of articles on the internet that give direct suggestions on which ecommerce platform is best for your business based on the size and the revenue your business generates. While this is great in one sense, it’s not entirely accurate.

It’s not the size of your business that matters, it’s the size of your vision.

The above statement should be the real determining factor for deciding what ecommerce platform you plan on using for your business.

Most resources, articles and blog posts suggest picking a platform based on what you need right now, very few people mention the fact that you should be picking a platform that falls in line with your future aspirations, goals and vision you have for your business.

Think about it, you pick a proprietary platform based on your “market size”, it does what you need for 1 year and then boom, your business starts growing, you need more integrations, you want a more unique customized website, but none of that can come to fruition because you picked a platform based on your current status and not your future goals, growth and vision for your company.

While in some cases it might make sense financially to start with a basic proprietary platform if you are a startup or small business lacking capital. However, if you have the capital to invest in an ecommerce platform that can grow with your business, and not against it, then it’s probably wise to invest in that platform sooner than later.

Consider the long term investment, not just the upfront costs.

Another downfall with the resources online is the misconception of costs. Most people are focused on the upfront cost for ecommerce platforms that they just ignore the long term investment.

Lots of resources online suggest using proprietary platforms if you are a small to mid sized business. Again, looking at the surface this makes sense. The upfront costs are very cheap and you can get started with most of these platforms for a low monthly fee.

What they forget to include is the long term investment involved with these proprietary platforms, especially if you are a growing business. If you didn't know, most proprietary platforms charge a 2% fee on every order purchased through your website. This doesn't sound like much, but let’s look at some simple math.  

Proprietary Platform Costs
Let’s look at this from a standpoint that you are a growing business. Also, keep in note we are only looking at gross revenue because that is what these platforms will charge you for.

$750,000 in sales (gross revenue ) X 2% = $15,000 Year

This doesn't seem like much based on the sales revenue, but realize if you have a growing business this number will only continue to rise. Over the course of a three year time span, if this business didn’t grow anymore it would cost them $45,000 in transaction fees.  

Keep in note, for the starting price of $15,000 you can get a pretty dang nice customized website built for your business. It would also be a ONE TIME COST and if it’s on an open source platform like Drupal, customizing and keeping up with your company growth would be hassle free.

Just realize market size doesn’t always determine the platform you should be using. If your mind set is on short term results and short term goals then you are most likely going to pick a platform that can solve a problem today, but create a problem in the future.

Our Suggestions

  1. Don’t predetermine your next ecommerce platform based on the size of your business.
  2. Look at your goals and vision for your website and conclude a long term strategy. What ecommerce platforms are going to help with this? Do they fit your budget?
  3. Consider the long term investment, how much money is this ecommerce platform going to cost you today, but also 1 year from now and 3 years from now.
  4. If you're struggling to make a decision get professional consulting from Acro Media, we can help!

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