Starting an eCommerce store can be daunting. If you don’t plan it well, it can cost you a lot of your hard-earned cash and leave you heartbroken and miserable (if I’m not laboring the point too much). Here is a step-by-step methodology to help you start a successful eCommerce store.
#1: Find a Profitable Niche
Lucky for us, we already know our niche: game and hobby. All we have to do is research it.
You probably already know your customers’ pet peeves, as you’re an enthusiast yourself. The beauty of being a customer as well as a seller is that it’s easier to know where to find the right information for your buyer persona.
A “buyer persona” is a clear picture of who your customer is. There are several ways to discover who they are, such as tracking them down on social media. Social media is quickly taking the lead in the marketing industry: it’s where most marketers go to learn more about their prospective customers and engage with them.
Take advantage of Facebook and Linkedin groups, Google+ communities, Reddit, Quora, and other social sites to understand what your customers are looking for. You can then stock products that cater to their needs.
Amazon and eBay are also useful for identifying your audience’s interests. Look up popular products on those platforms and see if you can stock the same, similar or better options.
Another alternative is to read the news. Online and industry-specific print media are excellent ways to discover your prospects’ unmet needs, and the game and hobby products that are already in demand.
Pay attention to the following:
- New product releases.
- Trends and innovations.
- Industry reports.
- Main challenges for consumers.
Most people don’t know it, but you can use PayPal for research, too. Simply go to the bottom of the homepage and click “Shop”. This will take you to a list of all the e-commerce sites that use PayPal to receive payments.
Select your desired category (for example Gaming, Gifts, Sports & Outdoors, or Children & Toys, depending on your specialty), then pick one of the top shops in the category. Go to their website. Read as much as you can, including the product reviews, and look at the top-selling items. The reviews will help you decide where you can compete in your niche.
#2: Analyze the Market Opportunity
The game and hobby market is already saturated. This shouldn’t deter you from setting shop. If anything, the mere thought that somebody else is already banking on your idea should motivate you to push harder.
Knowing what your prospective customers want is a sure way of telling if the market is ready for you or not. You may want to add a little twist to your products. To do this right, find out if there’s a loop that you can take advantage of in the niche.
To do this effectively, do the following:
Use Google Keyword Planner: A high volume search for your product’s keywords on Google usually translates to high demand for that particular product in the market.
You can search specific goods or series in the game and hobby industry to see if there’s demand.
Use Facebook Ads Manager: It’s also very similar to the Google keyword planner. It will help you to determine the size of the prospective audience related to certain products in this industry.
Simply create a new ad to test how big the market is for the games, toys or other collectibles you have in mind.
Use Industry report: What are the gatekeepers of the industry saying about new releases or already existing products?
Use Google Trends: This tool helps you know how the average search volume for your product’s keyword has been performing over time. The data helps you to analyze if your prospective market is shrinking, remaining steady or growing.
Study your Competition: Do you know any hobbyist-turned businesses in your area or on the Internet?
What are they up to? Knowing what your competition is up to or doing to scale their business might give you an insight on how to run yours once you set up.
#3: Define your Target Audience
If you can identify your fellow game and hobby enthusiasts and market your products to them will help you know your customer rather than trying to sell to everyone. Remember, in marketing, everyone is not even a word!
Knowing who to target will save you a lot of pain in the future. It will help you plan your marketing campaigns adequately.
Simply put, it’s important to know who your buyer persona is.
Defining your target audience is one of the tasks that you can’t overlook if you want to succeed in any industry. You can’t rush it. Taking the time to know who to market to help you reduce chances of refunds which can sometimes be long and tiring both emotionally and financially.
In this case, our ideal customer is a game and hobby enthusiast. Let’s assume he’s a man, but what kind of a man is he?
To know him better, you need to know his:
- Primary responsibilities
- Pet peeves/Pain points
- Purchasing decisions
- Sources of information
- Choice of content medium
- Days/times most likely to consume content
- Role in the purchasing process for the family
That’s not all!
What’s his demographic? (Location of residence)
What’s his behavior pattern? (How does he act in the environment in different circumstances?)
What motivates him? What’s his goal?
What’s his biggest challenge/issue?
Why would he buy from you and not somebody else? What will he achieve with your product?
Also, estimate the lifetime value of this customer: How much do you think this client can spend on you and for how long? Knowing this will help you predict how profitable your company will be long-term.
To know your customer better, do these:
Sell your products in person: Selling directly to your customers allows you to get your customers’ real time response to your products. You are then able to tell where your focus should be.
Sell your products on Amazon or eBay: These platforms receive high traffic every day; your only worry now will be to guard your rankings and the demand for your products.
Remember, this is different from affiliate marketing since you will be promoting your own products.
Create landing pages for your offers: Pick your hero products and build customized landing pages for them. Next, drive traffic with PPC ads (Facebook Ads or Adwords) and count your sales.
You can sell right away or ask people to pre-sign before your launch date. Test both ways to see what works.
Set up a test store: Some e-commerce platforms will allow you a few days trial; take it for what it is, a test drive. Set up your test store, list your products and then describe them.
You can drive traffic to them with PPC. If you make a sale within that period, then you’ll know that the market is ready for your products. Go ahead and build your e-commerce store and upscale your business.
#4: Position your Brand and Product
As you have noticed from all the research you have conducted up to this moment, the game and hobby industry is full already. What you want to sell already exists on the market.
Therefore, don’t try to compete with others!
Instead, position yourself in a new category: find out what aspect of your customers’ need is critically important to them. Are they perhaps looking for?
- Specific results
Use your findings to meet those unmet needs.
#5: Pricing Your Products
Pricing is a complex issue in virtually all businesses; this is not different. However, the following pricing tricks seem to work wonders for many. You can try them too.
Calculate your costs: Never price your product less than what it cost you to deliver it. Summarize it based on what it cost you to:
- Purchase it
- Acquire customers
- Deliver the product
- Pay for salaries, office materials, website maintenance, and more
Check out the prices of your competition: Go all out and find out what your competition is charging for the same product.
Use suggested retail prices: You can’t go wrong with this approach since you will be basing your prices on what everyone else in the market is charging.
Use keystone pricing: Some e-commerce stores will typically double what it cost them to purchase a product and pass that out as the price.
A/B test your pricing: Here you will be testing different prices and then keeping them depending on your clients’ reaction to them.
#6: Setting up Shop
This would have to be the technical part of your business, setting up your e-commerce store.
Domain name: What name will identify your game and hobby store? Start here:
Content Management System (CMS): This is an interface that lets you update your website from time to time. Hover over to the best e-commerce platforms to make your pick.
Hosting: This is similar to renting a house, and you have several options on which you can select to accommodate your domain. The options include:
Some of these hostings come with an SSL certificate, a necessity for most e-commerce stores.
Payment option: You are in business to make money, right? How then will it get to you?
Some of the best options include:
As game and hobby enthusiasts, we can claim to know our niche well. Next, we can start to analyze the market opportunity, define our target audience, position our brand and products, and decide on the price for those products before setting up our ecommerce store. After the prep work, we can then scale the business and watch it grow gradually.