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What it takes to sell over the web

Have you considered selling a product or service over the web, but put it off because you don't even know where to start? If so, read on for an overview of what's needed.

The components

For any type of commerce, be it of the online or the traditional "brick-and-mortar" variety, you need at least the following items: 1) a location, 2) a way for people to buy a product or service, 3) a safe and secure way to receive payments.

Location location location

With online commerce, your location is obviously a website. Just remember that having an online store carries with it the same burden as any other site – people must find it, and it must be easy to use. Be sure that your web designer understands the importance of your site being found in the search engines, as well as overall web usability. (For more information on these topics, check out my previous articles at www.ZolMedia.com/TechVille).

How an order is placed

Ok, let's assume that you've got a website of your own. How will you accept orders? A rudimentary approach would be to simply describe your products or services on the website, but then require your customers to call, mail, or fax their orders to you. In most cases, however, that pretty much defeats the point of having a website. It should automatically process the orders for you. Plus, customers expect to place their orders by interacting with the website. If they wanted to order by phone, they probably would've done that in the first place.

For a website to process orders automatically, it needs a shopping cart program. Think of the shopping cart as a collection of special web pages (and other files that reside on the website's computer, called a web server, that are unseen by the customer). This is what provides the intelligence to do things like total up the cost of the order, calculate tax, and process credit card information.

The shopping cart needs the web server to do a lot of special, behind-the-scenes things in order to run. That's why the simplest – and usually cheapest – shopping carts run on their own, pre-configured web servers. Your website merely provides links to the shopping cart's website. As soon as customers start the ordering process, they actually leave your site and go to the shopping cart vendor's site. Although this does limit how much you can customize the shopping cart, it also greatly simplifies the process of getting it set up.

On the other end of the spectrum, if you need a shopping cart that's fully customizable, your web developer needs to install the shopping cart directly onto your website's server. This requires more work and expense, but it also gives you more control over how the shopping cart works and what it looks like.

The bottom line is that there are a multitude of shopping carts to choose from that range in options, functionality, and cost. And don't feel like you have to spend thousands of dollars right off the bat. There are some basic options that may suit your needs just fine as you are starting out. You can then grow from there as your sales increase.

Secure payments

Another important piece of the puzzle is the security of the information that's being transferred over the web. If your customers were to type their credit card information into a regular web page, and then click the Submit button to send their information to you, it'd be fairly easy for a savvy online crook to see it. So, to prevent anybody from seeing that information, your website needs to use a special "secure" (SSL) page, which encrypts all of its information so that prying eyes can't (for all practical purposes), see it.

If you use the type of shopping cart that runs on the shopping cart vendor's website, then that vendor should be responsible for setting up secure pages. If you run a shopping cart program on your own website, then you're responsible for making sure all credit card pages are secure.

Depositing funds

Let's assume that you now have a website, a shopping cart, and a secure way to transmit the credit card information. How do you then use that credit card information to deposit the payment into your bank account?

First of all, you need to have a merchant account - this is true for walk-in stores too. However, merchant accounts that are approved for Internet payments have higher fees than traditional merchant accounts where customers physically sign their invoices. (PayPal does provide a way for you to receive funds without first obtaining a traditional merchant account, but it's at a fairly high fee).

Your bank will provide a way for you to manually process credit card payments (regardless of whether the purchase was over the Internet or not). To manually process the payments, you should be able to use regular credit card equipment (like what a retail store uses), call the bank by phone, or use a special website that the bank has set up. You can set up the shopping cart to store the credit card information on a private location on the shopping cart website, so that you can get this information and then process it manually. This is the cheapest and easiest method. Not all banks have the same rules about how Internet orders can be processed though, so be sure to check on their policy.

If your site receives a large volume of purchases (a good problem to have), you can automate the processing of payments by using a payment gateway. Without getting too technical, a gateway is essentially the "middleman" that transfers the funds from your customer's credit card account into your merchant account when a purchase is made. Authorize.net and Verisign, which you may have heard of, are two well-known gateways.

Of course, these automated gateways are normally more expensive for you to use.

Playing well together

One last note. You'll need to verify before-hand that all of the pieces of this eCommerce puzzle work with each other. Not all websites work with all shopping cart programs. And not all shopping cart programs work with all gateways, which don't work with all merchant accounts. Make sure all these parts will work with each other during the planning stages, not when you've already begun implementing your eCommerce website, and you'll avoid some major headaches!