FAQ: Implementation planning

Question 1

How to estimate an e-commerce implementation budget?

Accepted Answer

Today's variety of solutions lets you build a platform on your own from a few hundred — sometimes only a few dozen — złotys per month. On the other hand, all of us have heard about multimillion-złoty implementations.
To make budget estimation easier, it's worth taking a cost-based approach. Start by setting a budget range, defining your 'must have' and 'nice to have' requirements for the store, mapping key processes — and only then approach agencies. This will significantly improve the conversation, because it will rest on a solid foundation. It's also worth asking for advice on forums and social media, describing the boundary conditions (limits you cannot cross), otherwise the answers may end up far from the realities of your business.
Also important: technology is not everything. You need to factor in product content (because that's what drives sales), the cost of producing terms of service, privacy policy, and GDPR-compliant legal notes.
If you have extra budget it's worth getting help from a UX and UI specialist; if you don't have the budget for that, don't experiment — go with the standards offered by SaaS or open-source solutions.

Question 2

What is USP?

Accepted Answer

USP — unique selling point (sometimes proposition) — describes the features that set your e-commerce apart from the competition and the benefits the customer gets by shopping with you. A well-crafted USP should be expressible in a single sentence or take the form of short, evocative slogans, e.g. same-day delivery, professional product advice, or free returns. The benefits you present to your customers should respond to their needs, which is why they should be built on data about your target audience and competitive analysis. Bear in mind that a USP is not just an advertising slogan but a promise you can keep: a well-designed one lets you compete on more than just price. Today's e-commerce environment is increasingly competitive, so achieving a unique competitive edge is hard. That's why it pays off to also use the concept of VP (value proposition) — a specially curated set of benefits that addresses the most important customer needs or their biggest pain points.

Question 3

What is dropshipping?

Accepted Answer

Dropshipping is an increasingly popular business model in which the online store owner can sell without having their own warehouse — they only forward orders to a supplier (a wholesaler or manufacturer), who fulfils them and ships directly to the end customer. Even though the process doesn't take place at the store's premises, the e-commerce owner retains full control over transactional documents and the look of shipments.

Dropshipping has many pros and cons, but in terms of the main differentiator, it provides store owners with a low barrier to entry into online sales or a lower cost of acquiring inventory. Manufacturers and wholesalers, in turn, get the chance to expand their business with order-fulfilment services and to win a new source of customers.

Question 4

What is omnichannel?

Accepted Answer

Omnichannel is a sales strategy based on cooperation between all available customer-reach and customer-service channels (online store, mobile app, traditional showroom, social media, etc.). The customer, regardless of the lifecycle stage they're in, encounters consistent communication that meets their needs. This increases their satisfaction with the store and their positive associations with it. That in turn translates into greater engagement with the content the store sends them, and as a result — into greater customer loyalty and a higher CLV (customer lifetime value), the total value to your business across the customer's lifecycle.

Question 5

What competencies do I need in my e-commerce team?

Accepted Answer

Online sales is becoming more complex, and most people already realize that one manager handling everything from A to Z is not enough to comprehensively cover all e-commerce topics.

A good e-commerce must run each of the following functions (besides basics like accounting, finance, or legal) at a sufficiently high level:
 product function — choosing the right products, watching purchase prices and selling prices to keep margins satisfactory,
 operations function — managing logistics, fast shipping, automated billing and returns,
 technology function — selecting the right technologies for the sales system: store engine, ERP, WMS or accounting software, 
 marketing function — valuable, high-quality on-site content, well-optimized SEO, ad copy and social media handling — without quality content you won't get anywhere, even with well-coordinated performance activities (those focused on results), 
 performance function — well-optimized product feeds, ROAS analysis, optimizing for minimum margin, the ability to set the right campaign KPIs, results orientation,
 analytics function — a critical approach to information, understanding the technology to deliver the highest-quality data, the ability to evaluate advanced metrics — e.g. customer retention metrics like CLV,
UX / UI function — keeping visual coherence and intuitive navigation (extremely important now that more and more e-commerce sessions come from mobile, where there is less screen to work with), and the ability to collaborate with developers, who on their own won't plan the look and functionality of the store as well,
 PM function — defining tasks and prioritizing them, managing the work of multiple people, watching deadlines, ensuring effective communication within the team and between the team and external partners.

When specialists own these areas, each of them focuses on maximum optimization of their area. The e-commerce manager, backed by their expert knowledge, is then able to plan and manage the store's strategy better.

Question 6

Why does e-commerce need a Project Manager?

Accepted Answer

Every growing business is increasingly drowning in operational, day-to-day work that it can't function without, and people tend to silo themselves and look only at their slice of the work. Many ideas surface in a company about optimizing existing activities and starting new initiatives, but few of them get done. A good Project Manager is the person who makes sure that what comes up in conversations and emails as loose ideas gets defined and made specific. On top of that, they give those ideas a measurable scope and help shape a team of specialists in a way that achieves the set goals, which may exceed what individual team members can deliver. If you want your online store to keep balance between day-to-day work and growth, and want better execution on the ideas that pop up along the way, your e-commerce definitely needs a Project Manager.

Question 7

When is it worth moving from Allegro / brick-and-mortar to your own e-commerce?

Accepted Answer

In the omnichannel era we shouldn't talk about a transition or migration, but about adding new channels to your sales mix. Allegro is a good way to start your e-commerce journey if you already have a product and want to ship it to the market quickly. Once scale and the related commissions become significant, it's worth thinking about your own store and converting some customers (especially loyal ones) to your own platform. Allegro should still remain a branch for those who only buy through that platform — and there are quite a few such people, not least because of the increasingly popular Allegro Smart service.
Not every Allegro presence ties to business scale: bear in mind that this platform attracts specific user segments and profiles. Not every offering is suited to selling on this channel. The list includes niche products, where uniqueness of inventory and the broader product context dominate: there, price — so important on marketplaces — drops in priority.
For brick-and-mortar sales, in the era of the COVID-19 pandemic there's hardly anyone left to convince about adding an online channel. For offline businesses, e-commerce is also a great tool for cost-effective expansion into new cities or countries, and for testing demand for new products before mass production and physical distribution.

Question 8

What is a user story used for?

Accepted Answer

A user story is a method used e.g. in product design or UX design. They are short stories whose goal is to define user needs toward the product. They are written in the following format: As a (user) I want (need) so that (goal to achieve). User stories are built on personas: they reference how those personas behave, their needs, and potential concerns. With such scenarios we can map out the specific functionality our customers need: this lets us record individual site features in a way that is concise and understandable to everyone. An example user story for e-commerce could be the following sentence: As a customer I want to be able to see the shipping cost for my items at the cart level, because shipping cost determines my purchase decision in a given store. Well-written user stories will help cooperation with developers: through written stories we can verify what resources designing a feature will require from the IT team, or whether a given technology meets our business needs.

Question 9

What is VP and what does it mean in e-commerce?

Accepted Answer

VP (Value Proposition) is the definition of what a customer of a given company or brand receives and what costs they have to bear for it. In short you can describe VP with the equation:

value = benefits − costs

For e-commerce, a well-formulated value proposition helps build the image of our store or product as better than the competition and encourages the consumer to spend their money with us. In an increasingly competitive online business (when a unique edge — a USP — is harder and harder to come by), the value proposition is most often a combination of several benefits that build real value for the user.

To achieve that, remember three success factors:
Value must be delivered and recognized — that is, our product or store should genuinely respond to real consumer needs and pain points; the Value Proposition Canvas is a very helpful tool to find them,
Value must be argued and communicated — our value proposition should be clear and visible also to people who hadn't been in contact with us before, e.g. it's a good practice to expose it contextually at various stages of the user journey,
Value must be measured, tested, and improved — for the value proposition to work, its evolution must be based on real data — it may turn out that our edge is not price after all, but e.g. fast shipping and great customer service.

Question 10

How to validate your idea for an online store?

Accepted Answer

If you're not sure that your idea will be profitable and you're afraid the investment won't pay off, your main goal should be to minimize cost. There are a few ways to check whether our plans match reality:
 consider the dropshipping model before stocking up and locking money in inventory sitting in a warehouse. Although it gives you less control and a lower margin, the product investment shrinks to a minimum,
use cheap SaaS platforms or the Allegro/eBay/Amazon channel — although it requires concessions, it lets you save on big technology investments,
do solid research — find stores similar to your idea and try to estimate their sales scale — e.g. by monitoring them with tools like Allegro Tradewatch, or placing orders with the competition at the start and end of the month and inferring volume from the difference in order numbers,
study user demand by entering keywords describing your idea into Google Ads Keyword Planner, which reports the search volume of specific phrases on Google.

Ecommerce, Magento 2 and AI concepts explained