In the past two articles we looked at why businesses should go for a website. In this article, we shall look at the challenges of building an e-commerce centric website. Certainly there are technology problems, but more important are meeting customer expectations and integrating both offline and online business practices. As we shall see, e-commerce sites scope are much broader and complex than sites of other kind.
- Technology
- Order Processing
- Payment Handling
- Website Security
- Catalog Structure
- Maintaining SKU Numbers
- Real Time System
- Pricing Practices
- Shipping
- Handling Returns
- Customer Care Support
1. Technology
One of the most important decisions for a merchant is to choose the right technology. This becomes more critical if the merchant/business cannot afford an in-house technical team. Such merchants are at the mercy of software vendors. Before arriving at the technology the merchant should make it a point to talk to many such vendors. This process not only helps merchants to get familiar with various technologies but also the minute details required for building a scalable website. There are also FREE E-COMMERCE solutions available on the Internet. osCommerce, VirtueMart/Joomla and Zen Cart are some of the freely available e-commerce solutions.
2. Order Processing
An online order can be processed in two ways. Once an order is placed, an automatic order processing system acknowledges the order, verifies and processes credit card transactions and also interfaces the order system with the inventory system for processing shipment (shipment will have to be done manually). Order Processing System (OPS) enables order taking system is completely integrated with inventory and shipping system in real time. On the other hand, an order taking system is only responsible for accepting and acknowledging the order placed (order taking systems, may or may not handle credit card transactions). Once this is complete, manual process takes over at the inventory end. To provide real-time services, merchants can go for Order Processing System (OPS).
3. Payment Handling
In an e-commerce environment payments can be accepted from a Credit Card, via Bank Transfer, Cash-on-Delivery (CoD) or by traditional banking instruments like Cheque etc. So a merchant should consider all these options carefully before choosing his/her mode for accepting payment. Merchants can consider CoD for customers, who are not comfortable using credit cards over the Internet or with no credit cards.
4. Website Security
Online merchants would have to collect personal information of buyers (may include credit card information) for payment towards the goods ordered. Measures should be taken to ensure the safety of the data. It is advisable for merchants (especially small ones) to not to collect or store credit card information in their system.
Instead of handling credit cards directly in their site, merchants can direct shoppers to a payment gateway website along with any necessary information like the amount to be collected etc. The payment gateway website collects credit card number, CVV number and any other required information for verification purpose. Then the payment gateway checks the balance (and other details such as name, address etc are also checked) and either approves or rejects the customer transaction. After this the payment gateway passes the control to the shopping site along with verification result.
Note: A payment gateway facilitates the transfer of information/funds between a payment portal (such as a website or mobile phone) and the front-end processor or the acquiring bank (e.g. credit card issuing bank). Payment gateway is the server where the customer completes the online transaction by providing his/her credit card/bank account information. The payment gateway process is more complex than what is stated above.
5. Catalog Structure
In an e-commerce environment, the most important task for merchants is to maintain a product catalog that is consistent across various categories. Merchants need to invest lot of effort in maintaining such a catalog. Care should be taken to fit products that normally does not fit into any of the defined categories, or products that can fit into many categories. There would also be situations where additional sub-categories would have to be created in the catalog structure to accommodate a particular product. Offline merchants can overlook categorization if they do want a presence in the net. But a consistent product catalog is a requirement for a robust and scalable e-commerce website.
Part II of the article will appear next week.
