Evidence of the trend are observed in Shopify’s June 30, 2020, quarterly report. The organization achieved a 28-percent increase in subscription revenue for this period. The growth comes from new merchants along with clients who have added additional services, like upgrading to Shopify Plus.
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BigCommerce, another SaaS ecommerce platform, reported at exactly the same second quarter it enjoyed a 7-percent profit in the number of customers generating over $2,000 in annual contract value.
The pandemic might have encouraged many new entrepreneurs to start selling online and a great deal of established organizations to shift their focus to online selling. Picture: Ecwid.
The growth in SMB ecommerce is probably coming from two use cases.
Consider, first, a new ecommerce entrepreneur. Perhaps this person was furloughed during the pandemic, or worse yet, lost her job entirely. Beginning an ecommerce company looked like the best hope.
Secondly, consider established companies, maybe even people who’d dabbled with ecommerce. Until the shutdowns this spring, these companies may have focused on their brick-and-mortar operations. Suddenly the companies had a way to market online, even if customers would pick up the merchandise curbside. Ecommerce was the solution.
But ecommerce takes more than posting a few products online and waiting for the money to roll in. Successful ecommerce needs different skillsets than retailing from a physical space.
It requires a distinctive approach to customer acquisition, including knowing the best channels to acquire those clients. Other possible complications include sales tax collection in addition to the logistics of packing and shipping orders.
“[Picture that] I am a small company,” said Erik Suhonen, vice president of Ecwid, a SaaS ecommerce provider. “I want to focus on my craft of creating jewelry. I don’t really want to spend 90 percent of my time trying to figure out the technology,”
In agreement with Suhonen, ecommerce platforms may provide critical knowledge and insights — outside of the technology — to assist companies that are new to online selling.
Business owners”want to log into a website. . .see my three products and offer them on the web, on mobile, and on Facebook and Instagram. It’s click, click, click, and my goods are readily available to be found by a gigantic audience,” Suhonen said, punctuating each sales channel by pointing his finger.
“We assume that these SMBs are needing to focus on their craft as opposed to the technology. They might think,’I don’t know a great deal about advertising, so maybe I’m not going to market it at all’ or’I don’t know much about these sales channels.’ We built those stations into our platform. Additionally, we emphasize education,” said Suhonen.
Ecwid and other platforms aggregate information from tens of thousands of ecommerce websites and millions of transactions to identify the best approaches. Mix in some machine learning and artificial intelligence, and Ecwid knows when to recommend a company take a logical step in its own ecommerce development.
To sum up, for some smaller businesses trying to market online, based ecommerce platforms provide advice and technical knowledge to enhance the probability of success.