E-commerce

What Is an E-Commerce Startup?

An e-commerce startup sells products online through digital channels like online stores or mobile apps. E-commerce startups are still in the earliest stages of business development and may not yet have much traction or revenue. 

Startup e-commerce companies seek to harness the power of digital technology to build their brands and establish themselves in the competitive world of online shopping. E-commerce startup ideas typically strive to disrupt traditional retail markets by capitalizing on the advantages of digital commerce, such as global reach, scalability, and cost-effectiveness.

The birth of e-commerce can be traced back to the 1970s, when budding technologies like EDI (electronic data interchange) and teleshopping began laying the groundwork for e-commerce as we know it today. In 1979, entrepreneur Michael Aldrich created the first e-commerce business using a modified television set, a real-time multi-user transaction processing computer, and a telephone line. The e-commerce industry truly kicked off in the mid 1990s, when the dawn of the public internet made it possible for e-commerce pioneers like Amazon to begin marketing and selling their products online.

Since the 1990s, e-commerce has exploded into one of the most popular business models, and many brands are now shifting focus away from in-store experiences altogether in favor of online ones. In 2022, e-commerce accounted for 19.3% of the global retail market, totalling $5.4 trillion in e-commerce sales worldwide — and that number is projected to continue rising steadily over the next few years. 

What Are Some Successful E-Commerce Startup Strategies?

There are many established strategies for growing an e-commerce startup. Some of the fastest-growing e-commerce companies prioritize customer retention — gaining loyal customers who return to your site again and again is crucial for gaining a foothold as an e-commerce business.

Here’s a convenient e-commerce startup checklist that includes a few of the best strategies for driving growth and customer retention in e-commerce:

1. Search Engine Optimization

One of the most essential considerations for e-commerce startups is search engine optimization (SEO). Investing in a robust SEO strategy will help you improve your website's visibility in search engine results — which is crucial for any online business. 

2. Selling on Established Marketplaces

Another common e-commerce business plan is to sell products on established e-commerce marketplaces like Amazon, Shopify, or Etsy. These platforms offer access to existing customer bases and can make it much easier for your young e-commerce business to develop brand awareness and credibility.

3. Personalized Content Marketing

By analyzing customer preferences and behaviors, you can develop targeted messaging for your e-commerce customers in the form of product recommendations, tailored offers, customized email campaigns, and more. Australian e-commerce brand Beer Cartel successfully leveraged content marketing when they used a well-crafted survey to provide their customer base with valuable insights about the craft beer industry, leading to a significant increase in website traffic and revenue.

What can an e-commerce startup mentor do for you?

E-commerce is a unique field with its own set of challenges. A mentor with industry expertise understands the nuances of online retail, including emerging e-commerce trends and the best digital marketing strategies. An experienced mentor can help you validate your e-commerce business ideas by going over your ideas with you and showing you how to conduct detailed market analysis.

Moreover, mentors who have navigated the e-commerce business industry themselves have likely encountered the same obstacles you will encounter and can offer practical solutions and guidance based on their firsthand experiences, helping you to make informed decisions and steer clear of costly mistakes. A mentor provided through Mentorcam can also help you estimate your anticipated e-commerce startup cost and aid you as you navigate the process of securing e-commerce startup funding.

Related areas of interest: VC, Fundraising