How Does an Ecommerce Website Work

Before we understand the working of an ecommerce website, let’s understand what ecommerce stands for. In simple terms, ecommerce stands for electronic commerce which involves making use of electronics for buying and selling of merchandize or services. Many view ecommerce as a thing of extreme convenience as it allows people to buy almost anything online and with greater convenience than buying from a conventional store.

Why Ecommerce Is Popular?

The business model of both online and physical retail businesses are almost the same but there are major benefits of using the online buying route for ordering products and services. The fact that an ecommerce business model operates digitally makes it unique.

More and more people are buying online now thanks to the rapid and expansive reach of ecommerce. They are enjoying the benefits of convenience and often have to pay less while shopping online. Online stores are able to price their products competitively as they do not have to deal with overheads such as inventory space, more employees, and other aspects that a brick and mortar store has to spend on.

What Makes Ecommerce Websites Unique

Ecommerce websites are created differently than other types of business websites. These sites must have, apart from the usual features, the mechanism to accept orders from online customers. The software that accepts an order online and then processes it is known as a shopping cart. This cart is designed to carry out various functions apart from maintaining a record of purchases and updating the order database. It also processes any applicable discounts and coupons offered with specific items.

The shopping cart performs other critical functions that form the main components of an online buying process:

  • Lists the delivery address and billing details
  • Creates codes related to order number, tracking number and invoice
  • Ensures that the terms and conditions of the service are met by the customer
  • Forwards the invoice and delivery details to the payment gateway

Online Payment Mechanism

Ecommerce websites must also include a payment mechanism so that customers can pay for their purchases online securely and conveniently. All ecommerce transactions involve the use of digital money. Monetary transactions are managed by unique software which presents customers with various online payment options such as credit card payment, debit card payment, payment through a bank account, cash coupons and others. Multiple authentication features such as user password, CVV code, and one-time password are needed to complete the payment process. This is necessary to ensure that your payment is done securely and in a risk-free manner.

Logistics Management

Ecommerce websites must also have features that deal with logistics. The products that customers order online must be delivered to the address that they have provided. There are specific deadlines for delivering products to customers and unless there are effective logistics in place, achieving this can be quite a challenge.  Ecommerce websites must not only deliver the right product in good condition but also within the timeline stated on their website.

Logistics is a specialized field and that’s the reason why most ecommerce businesses are wary of handling it in-house. It is a common practice among ecommerce entrepreneurs to outsource the logistics part of their business to a proven third party logistics specialist.

Customer Service:

Like all other businesses, ecommerce business too must service their customers. The only difference is that in an ecommerce purchase, the customer could have loads of queries that must be addressed convincingly to move them to the next level of the sale cycle. In other words, they must be serviced pre-sales as well as post-sales.

It is normal for online customers to have questions about the features of products as all the details of the product might not be available on the product page of the ecommerce website. The questions that customers generally ask the support team related to features, customization, pricing, guarantee, accessories, and the return of the product. Post-sales the queries are generally about how to use the brand, repair facilities, performance, and others.

Reverse Logistics:

There is nothing like perfection in marketing. Error-free products are not a possibility. Even premium brands do develop some defects during the manufacturing and marketing process. When a customer buys a product through an ecommerce website and finds that they have been delivered a defective product or one that does not have all the promised features, there must be a mechanism available to address such instances. In ecommerce business, reverse logistics is a must-have to deal with issues such as delivery of wrong or defective products. The flow of the merchandize is in the reverse direction – from the delivery address of the customer to the merchant or the destination stated in the return policy of the business.

As we have seen, an ecommerce website is significantly different from a conventional website or a traditional business in many ways. There are many components involved. To succeed in your ecommerce venture, you must crack the code of managing the various departments and responsibilities

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