There’s a burgeoning opportunity in ecommerce for freelance developers. WordPress ecommerce is booming and you can be a part of it.
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There’s a burgeoning opportunity in ecommerce for freelance developers. Ecommerce is booming and you can be a part of it.
Ecommerce is definitely complicated, but it’s getting easier to do ecommerce with WordPress. The boom is about to get bigger.
As a WordPress developer you can specialize in ecommerce and be poised to take advantage of the growing need for ecommerce.
Let’s take a closer look at this opportunity.
First let’s talk WordPress.It started in 2004. It’s been around for 10 years. It’s powering more than 20% of the web.
It’s powering 52 of the top 100 blogs. 69% use it as a content management system.
All of that means WordPress is a sold platform for building websites. It’s stable. It’s secure. It’s mature. It’s not going to disappear when some net giant gobbles it up. It’s not some weird system nobody knows—it’s practically mainstream.
It powers the best of the web and it’s not pigeonholed to something that doesn’t apply to your work. It’s flexible yet proven.
You probably know all this, but it’s important to reiterate. WordPress is a solid platform and you need to be prepared to make that case to your clients.
Now let’s talk about ecommerce.
WordPress paves the way for the opportunity, but ecommerce is where it really takes off.
Ecommerce first started back in 1979 with the first transaction conducted with a modified TV over a telephone line. Online shopping had begun!
Fifteen years later Jeff Bezos started Amazon, Netscape introduced SSL—the security that makes online shopping possible—and Pizza Hut started online ordering. 1994 was the birth of ecommerce as we know it today.
Almost 20 years later and nearly every major retailer has an online shopping component. Black Friday is rivaled by Cyber Monday.
Ecommerce brought in $231 billion for U.S. retailers last year. It’s expected to increase 14% this year. Western Europe is supposed to grow even faster.
But for all the incredible growth in ecommerce, it’s still less than 6% of total sales.
That’s only going to increase. And that means opportunity for you.
More and more companies want to sell their stuff online. There are local shops that need to go global, nonprofits that need to accept donations and professional services that want to streamline with online payment.
There’s a lot of room for growth and that requires a developer who knows their stuff. That can be you.
WP + Ecommerce = Opportunity
The platform of WordPress paired with the growth of ecommerce means opportunity for you.
It’s a chance to narrow your focus.
Find bigger and better clients.
Charge more money.
And ultimately live your dreams. We’re big believers in the entrepreneurial spirit that enables us to chase after our dreams, not just work for somebody else.
That’s your opportunity. Specialize in the development of WordPress ecommerce sites and tap into this growing market.
As you’re thinking about getting into WordPress ecommerce development it’s worth considering what’s going to be different. Why should tacking on ecommerce to your web development necessitate an entire ebook? How will offering ecommerce change your business?
This isn’t just a lark, something you can simply tack on to your list of services. Ecommerce will change things. Here’s how:
1. It’s Big.
Ecommerce is a beast. The fact that we wrote an entire ebook about how this can be the focus of your freelance business should tell you how serious we are. Heck, this is our fourth book on ecommerce. We think it’s pretty huge.
Everything about ecommerce is bigger. It costs more money, it takes more time, there’s more that can go wrong, there’s more to test, etc. Ecommerce isn’t just an extra feature you’re offering to customers, like a contact form or a calendar. It’s on a whole different level. You can’t just dip your toe in the ecommerce waters, to truly master it you need to dive in.
2. Money Is on the Line
A big reason things change when you add ecommerce is because money is on the line. A lot of websites generate money for clients, but without ecommerce those sites are doing it indirectly. They’re selling the company as a whole, generating interest and maybe contacts that eventually turn into cash. But ecommerce delivers that cash directly. Things change when money changes hands.
With all that money on the line security is a major concern. People say they care about security—then they use “password” for their password. But when money is at stake, they get serious about security. And it is serious business. You’re asking people for their credit card numbers, you’re taking their financial data into your hands. So you better believe security is important.
4. More Complicated
By its very nature ecommerce is complicated. You’re interfacing with banks and payment accounts and transferring money. It’s not a simple, straight forward site. There are more players, more processes, more steps, more code. The complications increase exponentially.
This is a big deal and can be a struggle for some people. If you’re not used to tackling complex projects, you better ask yourself some difficult questions. Are you up for this? Can you handle the complexity? Will you be yearning for simpler days and simpler projects?
It’s important you understand what kind of a shift happens when you offer ecommerce services. This is big. It requires a lot of work and investment on your part. Of course this big investment also means there’s the possibility of a big reward. But you need to understand this isn’t a get rich quick band wagon to join. It will require a major shift in your business process and approach. Know what you’re getting into.
Three Reasons to Specialize
We think there’s an incredible opportunity for web developers to build ecommerce sites on WordPress. Here are three quick reasons why you should specialize:
1. Opportunity & Need
There’s a new opportunity you can take advantage of. Ecommerce only accounts for 6% of U.S. sales right now and that’s sure to grow. A lot of big companies have ecommerce, but so many small businesses, independents and nonprofits need it. There’s an incredible need for local businesses to go global and that happens with ecommerce. You can help them get there.
2. Lack of Experts
There are a lot of freelance web developers out there. But not many of them are ecommerce experts. iThemes founder Cory Miller was curious about this and asked for WordPress ecommerce experts on Twitter. He only got two, both of whom he already knew about.
It’s a field that hasn’t been staked out yet. There’s room to make a name for yourself.
3. Make More Money
The complexity of ecommerce sites means you’re charging more money. That means you can make more money be leveraging your expertise. A higher price tag can mean more margin. There are more expenses and extra pieces to factor in, all of which mean more room for profit. We know money isn’t everything, but it is money to help you get where you want to go faster.
All right, we’ve had some big talk about opportunity. Let’s get real. What does that actually look like? What markets can you move in to selling ecommerce sites?
We think there are two major areas to focus on:
- Small Business & Nonprofits
These aren’t the only opportunities for ecommerce development, but they’re some of the biggest.
There are so many do-it-yourself people out there running their own businesses, spinning off side projects and just creating stuff.
A lot of them need to sell that stuff too.
While some of these crafty entrepreneurs will figure out ecommerce on their own (they are independent), a lot of them will need help. They might be able to set up a simple WordPress site on their own, but ecommerce is a step too complicated.
You can help.
We’re talking about people selling ebooks or launching membership sites, consultants who could offer automatic payments for their retainer, artists looking to sell their goods beyond the local art fair.
These independents might be running a glorified hobby that’s starting to make money. They might be on their way to becoming a small businesses, but they’re not there yet.
Help them grow. Start them out small and take slow steps forward as they’re ready and able. Their initial needs might be small and humble, but that’s where all independents start out. Who knows where they’re going to go? And you could help them rise to the top.
Tip: Customize Your Offerings
Independents are a breed set a part. Your standard packages and offerings aren’t going to work for them. We strongly encourage selling a recurring maintenance package with an ecommerce site, but that recurring payment might be a deal breaker for an independent that lacks stable cash flow. Find ways to customize your offerings and make them work for an independent that’s still getting started.
Small Businesses & Nonprofits
This is one of the biggest opportunities for growth: small organizations that need help with ecommerce. There are so many small businesses and nonprofits in this boat. An online store has never been within reach, but the ease of WordPress and ecommerce makes it possible. You can help them get there.
Think Local, Sell Global
When you’re looking for ecommerce clients you need to think locally and globally at the same time. Which businesses are selling locally that could easily expand to a global market by going online? Right now they’re limited to a geographic area and the customers willing to physically travel to the store. But what if they could go online and reach the world?
The Internet can destroy geographic limitations, but that doesn’t have to benefit only the behemoths like Amazon. Small local shops can benefit as well. They’ve got style, experience and character Amazon can’t match. If these shops can thrive locally, they can probably do good business online as well.
Think of small retail stores and how they could go global. We’re talking clothing, books, sports, jewelry, gifts, cameras, furniture, toys, hobbies, stationary, bikes, used items, etc. The list goes on an on, but for whatever category you can think of there’s probably a way to expand their business with ecommerce.
Tip: Bricks & Clicks
The digital divide has always focused on online shops vs. bricks and mortar. But there’s no reason there has to be a divide. Instead of bricks and mortar, local shops should think about bricks and clicks. They have the bricks but they need to find a way to add the clicks.
Think about the food and beverage industry. It’s an area often overlooked in the ecommerce world. But there are a lot of options. There are online orders for items that can be shipped and to go orders for instant eats. There are catering businesses and food trucks that could book deals online. Some restaurants that generate a following need to sell traditional items like T-shirts (it works for Hard Rock Cafe).
Another category ripe for ecommerce growth is the nonprofit world. So many small nonprofits are still intimidated by online donations and they haven’t made the step.
In some cases it can be a source for incredible new growth. One of our iThemes Training presenters, Nathan Ingram, shared a story about convincing a nonprofit client to accept online donations. They were worried about existing donors shifting to online giving and credit card fees eating into donations. Nathan convinced them to move forward by offering to pay for any lost revenue himself. In the end, 90% of the online donations were from new donors who had never given before. Total donations increased by 15%. Needless to say, Nathan didn’t have to open his wallet.
Think about all the different types of nonprofits you could reach out to—churches, museums, galleries, gardens, camps, charities, politicians, etc. There’s a lot of opportunity out there.
Also think about all the different ecommerce needs they might have. Sometimes nonprofits are overlooked because they’re not always selling something. But they still need money—donations, ticketing, memberships, etc.
Tip: Easy to Give & Go
If you want to succeed with nonprofits, make it easy to give and go. Make it easy for people to give to nonprofits and make it easy for nonprofits to sell tickets to events. Donations and event registration are two major areas for nonprofits.
Manufacturing & Wholesale
There’s a lot of opportunity in the manufacturing sector and any business to business sales. Anytime these businesses are taking orders on the phone they could do it with less staff by going online. Maybe they’re selling custom parts or one-off items. Maybe it’s excess inventory they’re unloading. In many cases they’re selling to other businesses that have a driving need for the product and closing the sale is mostly a matter of speeding up the process. Ecommerce can help with that.
Personal & Professional Services
Another forgotten area is services. Often these services are performed in person, so online payment seems excessive. But there are plenty of cases where nobody is in person and paying online would be a huge improvement. Even for services performed in person, online payment can be faster and more efficient. Consultants, coaches, therapists, dog walkers, lawn mowing, cleaning, freelancers, etc. Any recurring service—like lawn mowing, cleaning or freelancers with a retainer—would benefit from online payments because they could be set up to recur automatically, minimizing paperwork and delays while stabilizing cash flow.
Tip: Check the Yellow Pages
For more ideas of companies ripe to expand into ecommerce, check the Yellow Pages. Any company paying for Yellow Pages advertising is wasting their money. That also means they have money to spend on marketing, so you can make your case for a more efficient (and traceable) approach to marketing. Help them go online and expand globally. Just flip through the Yellow Pages looking for companies with products or services that could be sold online.
So we’ve looked at the markets. Now what services could you offer those markets?
It’s not enough to sell ecommerce. If you’ve got some savvy contacts they might be able to imagine the possibilities themselves. But for other potential clients you’ll have to help them get the picture. Pitch your vision for how ecommerce could enhance what they’re doing.
Focus on specific benefits you can offer and specific problems your skills and tools can solve. Remember to focus on how it helps your client, and couch things from your client’s perspective, not necessarily how you see it. For example, a client isn’t likely to care about SSL certificates and virtual private server hosting. You’ll get confused looks. But if you talk security, a faster site and minimal downtime, you’ll see that twinkle of understanding in the client’s eye.
First you need to consider what services you have to offer. That’s what we’ll cover next. But don’t forget to think about how the client will understand (or be confused by) these services. Come up with what you can offer, but then translate those services into something your clients can get excited about.
Three Hot Services
Here are three popular services you can pitch to potential clients:
1. Membership Sites
The dreaded paywall isn’t the only way to charge customers for content. Membership sites are growing in popularity as a way to charge for content but also develop a community around that content. Instead of a paywall it’s a club.
Membership sites are specialty ecommerce sites that could use pro developers to truly cover all the ins and outs. Check out our ebook Join the Club: How-to Create a Membership Site for more.
2. Flat Rate Shipping
Ecommerce is complicated. Keep it simple with flat rate shipping. Focus on clients who don’t need all the complex shipping options. Look at artisans who should be building their own domain instead of relying on ebay or Etsy.
Check out our blog post 10 Ways to Use Flat Rate Shipping for more on how you can make the most of super simple shipping for your clients.
3. Recurring Payments
Another popular option these days is recurring payments. People like to set it and forget it, and that’s pretty great when it means giving you money. Recurring payments can work for donations, subscriptions, retainers and any kind of recurring service (lawn mowing, house cleaning, dog walking, etc.).
Learn more about recurring payments with our blog post Why and How to Use Recurring Payments in Your Organization.
So what else can you offer to potential clients?
There are a number of basic ecommerce components you can roll into your services. These might be things clients could get for themselves, but they’ll be better served if you handle it. You know it’s taken care of and it’s one less thing for the client to worry about. Some of those basic services include:
- SSL Certificates
- Domain Names
- Testing & Optimization
- Product Photos or Videos
- Mobile Friendly
Some of these are one-time services you would offer when building the site, but others are ongoing services you could offer as part of a monthly package, creating a recurring payment for yourself. We’ll talk more about this later.
One way to go above and beyond the call of duty is to help your client integrate their new ecommerce site with their existing systems.
- Bookkeeping – Find out how they keep their books and offer to create something that integrates with their current system. Maybe it’s importing sales records or other stats to Quicken, Salesforce or other systems.
- Contact Database – Every time a customer buys something from the site you build, that’s a new contact. You should offer an opt-in option and connect those new customers to the client’s contact database. You might even be directly importing email addresses to an email newsletter system.
- Social Media Connection – Social is everywhere these days and ecommerce is no exception. You can offer social media integration, everything from pinning products to Pinterest, tweeting about new purchases on Twitter or sharing product videos on YouTube (the second largest search engine in the world).
Specific Ecommerce Services
We already talked specifically about recurring payments, membership sites and flat rate shipping, but here are some more specific ecommerce features you can pitch to your clients:
- Free Shipping – Shipping can be very complicated, but it gets brain dead simple when you don’t charge for it. Make the case for how free shipping could help your client avoid complexity and boost sales.
- Shipping Modules – Free shipping isn’t for everyone, so sometimes you need all the options. Pitch a shipping solution that will work for your client, whether it’s complicated shipping tiers based on different variables or live rates from USPS, FedEx or UPS.
- Name Your Own Price – Letting customers set their own price is a must-have for taking donations and it’s something not every ecommerce plugin offers out of the box.
- Product Gallery & Preview – Customers can’t get their hands on the goods—that’s one of the biggest challenges for ecommerce. So anything you can do to help them see what they’re buying is big. It not only helps close the deal, but it also reduces returns and increases customer satisfaction. Happier customers! Expanded product photos, samples and any other kind of preview might be enticing to your client. Show off their stuff. Pitch a more robust product gallery, bigger photos, simple features to zoom in on those photos, maybe even the option for video. This is huge if your client has products that really need to be seen to be appreciated. Help them get their customers as close to being in the actual store as they can.
- Discounts & Coupons – Offering sales and coupon codes isn’t an out-of-the-box feature on many ecommerce systems. Really robust sales and coupons that don’t give away the bank are a good way to entice customers, but it’s on you to build them in. If discounts will drive sales for your client, be sure to pitch a solid solution.
- Affiliate Sales – Some businesses thrive on word of mouth and what better way to encourage it than paying for it? Affiliate sales can be a big driver of growth, but it’s also a huge component to build.
- Customer Feedback – Interaction is the name of the Internet game. Features like customer reviews and ratings can show popularity and help close sales.
- Wishlists – Give customers the option to create wishlists to remember products they love or encourage gift giving. Probably not useful for the nuts and bolts supplier, but ideal for the organic baby gear store.
- Product Variants – Some products need lots of variations. Different sizes, colors and options. You want a simple way to handle these that’s easy on the client and doesn’t confuse the customer. If your client will need variants, emphasize how you can make all those options easy.
- Advanced Taxes – Taxes can be an extra complication, especially online. Know where your client is located and pitch a solution to handle their specific tax needs. Go above and beyond and tell them—don’t ask—what kind of taxes they’ll need to pay.
- Guest Purchasing – Greasing the wheels of the transaction is important online and sometimes registering to buy is too much. Guest purchasing allows customers to buy without registering.
- Search & Sort – If a client has a lot of products, you really want advanced sort and search options. Let customers filter products by color, price, size, style, etc.
- Internationalization – An important feature for going global is multiple languages, currencies and other localization features. Going global isn’t easy and it’s not for everyone. But it can be a way to tap new markets or better serve different audiences.
- Shipping Estimates – Make shipping less of an issue by offering estimates before check out. Customers enter a ZIP code and get an idea what shipping is going to cost. It’s one more option that can reduce shopping cart abandonment.
- Related Products – Browsing online isn’t as easy as wandering the aisles of a store, so anything you can do to point customers to more products is helpful. Showing related products or what other customers also bought can boost that shopping experience.
- Product Displays – Another way to help customers shop is with pages to showcase different products, whether it’s departments, feature pages, sales, etc.
- Product Comparison – Help customers shop by allowing them to compare items side by side. It’s especially helpful for clients selling different levels of products with varying features—like electronics.
- Customer Accounts – If your client wants to forge long-term relationships with customers, it helps to give customers all the info they need. Account pages with order history, past downloads, favorites, etc., can go a long way toward cementing that relationship.
- Secure Downloads – Some clients can be protective of their digital files and want some measure of control. They don’t want customers emailing the download link to all their friends. Offer features to control when and how often customers can download digital files.
- Email Notifications – Add an extra measure of service with order confirmation, shipping confirmation, invoices/receipts, etc., all delivered via automatic email.
- Inventory Management – Big operations need to keep track of inventory, both internally so they can order more products and externally so they can show customers out of stock notices. If this is an issue for your client, it’s an important tool to offer and a way to show that WordPress can compete with the big ecommerce products.
- Local Pick Up – If your client is a local retail store with a strong physical presence, then local pick up might be an obvious and helpful way to allow their online store to build momentum.
Remember that at this stage it’s all about selling these services to the client. That means making them sound appealing to your potential client and not to you. So you have to know your client. If they’re a small town local shop that sells local souvenirs, then international features like multiple languages and currencies probably aren’t that valuable. Also, don’t fill your pitch with buzz words, features and lingo. Talk benefits. How will this service make your client more money or make their job easier?
Know your audience.
WordPress for Ecommerce
If you’re going to be a successful WordPress ecommerce developer you need to be able to sell WordPress. We’ve already talked about the ubiquity of WordPress and those numbers and stats should go a long way. But in some cases you might need to go a little deeper to prove to a potential client that WordPress is the right choice.
There are so many ecommerce options out there these days that WordPress is not a forgone conclusion. There are a lot of packaged, hosted solutions like Shopify that try to make things easy and end up taking away control. You can also go to the other extreme with complicated software that’s powerful enough to run a massive store, but doesn’t have the usability, flexibility or content capabilities of WordPress.
These are some of those benefits you could talk up to a reluctant client:
Freedom & Control
WordPress gives you the freedom to do what you want and the power to control it. You can control exactly how to handle products, how to display them, what to display. You can make it a traditional site or something wild and cutting edge. It’s simply a platform and it’s up to you as the developer to build something awesome on top of it.
Content & Commerce Together
WordPress allows you to bring content and commerce together in one site with one admin interface. Too many ecommerce solutions have content bolted on as an afterthought and it shows. With WordPress the two are melded together and you don’t have to choose. Your clients get the best of both worlds. Don’t compromise on content. A client should be able to use their content to easily sell more goods.
WordPress has security you can trust—provided you keep it up to date. That’s where most of the horror stories come from—user error. And as a developer that’s an opportunity for you to offer an ongoing service and charge accordingly. Let worried clients know what causes WordPress security issues and how you can keep their site safe.
WordPress is so easy your mom can use it. That’s important. Many of your clients won’t be super tech savvy. The success or failure of the site may come down to their ability to use it. If you’ve got a complicated backend, that can be a recipe for failure.
It Grows With You
WordPress can grow with your client. It can support any site from the simple to the complex. It’s flexible enough to allow almost anything they need. If they can imagine it, you can probably build it.
Great Ecommerce Plugins
This hasn’t always been the case, but in the past few years there’s been a proliferation of quality ecommerce plugins. There’s a lot to choose from and they’re top notch. We’ll talk specifics later, but the important part is you’re not hemmed in with a single option.
All of that makes WordPress the ideal solution for small businesses, independent entrepreneurs, nonprofits and more looking to get into ecommerce. And you can help them get there.
Understanding the Ecommerce Process
Adding ecommerce to your list of WordPress web development skills is no small feat. There’s a lot to learn and understand here, especially because there are so many extra pieces and players involved.
That and the money. Money always complicates things.
First and foremost you need to understand how ecommerce works.
We’re going to walk through the standard ecommerce process, then look at how things change with a third party processor. We’ll also talk about security requirements and what to consider when choosing a payment system.
It’s everything you need to know about ecommerce and then some.
Standard Ecommerce Process
The standard ecommerce process has four main steps:
- Shopping Cart
- Payment Gateway
- Merchant Account
- Bank Account
In some ways that’s how you can follow the money. It starts in the shopping cart where a customer checks out and enters their credit card info. Then a payment gateway talks to the bank and confirms the transaction. Later, the payment gateway sends approved transactions to the merchant account to start collecting money. Your merchant account collects all your hard earned money from the various banks backing your customers’ credit cards. Then your merchant account deposits that money in your business’ bank account.
And that’s how you get paid online. Cha-ching.
That’s a quick look at the overall process. Now let’s go in-depth.
The job of a shopping cart is to manage the shopping process, communicate with the payment gateway and keep the user happy. We expect a lot more of our online shopping carts than we do our real world ones. And that last role, keeping the user happy, is the most important one.
Shopping cart abandonment is the number one problem you’ll face in ecommerce. Finding ways to get more people through the checkout process is literally more money for a client, and they’ll pay you well to make it happen.
When you’re doing ecommerce with WordPress, the shopping cart is determined by the ecommerce plugin you choose. There are several options, including Shopp, Cart66, Woo Commerce, Gravity Forms, Easy Digital Downloads and our own iThemes Exchange.
WordPress ecommerce plugins are changing and adapting all the time, so it’s hard to say definitively what each one does, but here’s a snapshot at the time we published this ebook:
Like we said, things change, so check out each plugin to see the latest and greatest.
Each plugin will have different pros and cons. They’re going to work differently, interface with different payment gateways (they don’t all play nice together) and offer different experiences to the customer.
Next comes the payment gateway. This operates much like the point of sale system in a retail store. The cashier swipes your card and the machine either approves or denies your credit card. Same thing happens online.
Your shopping cart delivers the credit card data to the payment gateway and they talk to the banks to get an approval or denial. You’re finding out if your customer’s card is going to work or if it’s maxed out.
If the transaction is approved, the payment gateway collects the approval code. Those authorizations are collected throughout the day and delivered in a single batch, usually once per day, to the merchant account so you can get paid.
Some payment gateways allow you to manually enter credit cards, which can enable you to do orders in person or over the phone. Some even have point of sale systems, usually simplified attachments for an iPhone or other device.
Payment gateways charge several fees, including a transaction fee (often 10 cents per transaction), a batch fee (often 25 cents) and often they’ll have a minimum monthly fee (maybe $20). This doesn’t include any fees you’ll pay with your merchant account.
The next step is the merchant account. It’s a bank that receives the list of credit card authorizations from your payment gateway, usually once a day. This is like a list of IOUs from credit card companies. Your merchant account is like a collections agent that goes around and collects payments.
It’s called the settlement process, and it looks sort of like this:
Your merchant account will collect all those payments and hold them in your account. Some merchant accounts have automatic deposits to your bank account and with others you need to go in and transfer the money.
As with all banks, the merchant account doesn’t do all this work for free. They collect their share of fees including:
- Discount rate – This is the actual credit card fee, a 2-6% fee that varies based on the credit card and sales volume. Visa is usually the lowest and American Express and Discover are higher. Cards with rewards usually have a higher rate.
- Monthly minimum fee – If you don’t have enough volume, they still want a set amount of money.
- Customer service fee – An extra fee to cover customer service.
- Annual fee – Another extra fee just to maintain your account, which can be as high as $400.
- Chargeback fee – This happens when a customer challenges a charge on their statement. It’s usually a $15-30 fee and sometimes you have to pay it whether or not the chargeback is successful.
Types of fees and the exact amounts vary widely between banks and customers.
The merchant account is the most complicated part of an ecommerce site, hands down. The application process is detailed and time consuming, there are a lot of requirements (SSL & PCI compliance) and it’s common to be denied.
How complicated is getting a merchant account? It’s comparable to getting a loan to buy a house.
It’s so complicated because the bank is weighing the risk of doing business with you. They want to know you’re trustworthy before they’ll issue you an account. This isn’t a simple checking account.
Tip: Merchant Account First
Make sure you nail down a merchant account before doing any work on an ecommerce site. Some plugins won’t work with some merchant accounts so you need to make sure you have something that’s compatible. The process of getting a merchant account can also take a while and getting denied is a very real possibility. Make sure you have that approval in hand or you could be in trouble. You should even protect yourself by adding language to your contract about what happens if the merchant account falls through.
More on Chargebacks
Chargeback fees can be pretty costly, so it helps to understand how they work and how to avoid them.
When a customer gets their credit card statement and sees a charge they didn’t authorize, they can contact their credit card company and challenge the charge. That starts the chargeback process. The credit card company will contact your merchant account and ask for verification of the charge. Often customers forget they made the purchase or don’t recognize the name on their statement.
But if the customer is right you have to refund their money and pay the chargeback fee. Sometimes you’ll have to pay the chargeback fee no matter what happens, even if you can provide documentation that the customer did in fact initiate the transaction. Too many chargeback fees and you could lose your merchant account.
One of the best ways to avoid chargebacks is branding. Make sure the client’s business name is consistent and clearly appears on credit card statements. Make sure this same name appears on all communication. Ideally you want the URL of the site listed on the statement. This all reinforces the client’s name and avoids confusion when customers see the name on their statements.
The final step in the ecommerce process is easy: Get your money.
All your money collects in the merchant account until it can be paid out to your business bank account. Usually there’s an automatic transaction to deposit that money but sometimes you’ll have to go in and initiate that transaction yourself. There’s also usually a waiting period before you can transfer money from the merchant account.
While this step is relatively simple, just remember the money in your merchant account isn’t necessarily yours until it’s deposited in your bank account. Your merchant account might require you to maintain a minimum balance (to cover chargebacks and other fees) and can put a hold on your account if it sees suspicious activity.
These issues happen on the merchant account side and have nothing to do with your bank, but it’s worth keeping them in mind because sometimes it means you’re not getting cash into your bank where you can use it.
Tip: Keep your Merchant Account Informed
That happened to us at iThemes. We launched iThemes Training with a new merchant account and had a huge boost in sales that looked out of character to our merchant account. They put a hold on our account and it took six months to sort that out and get our money into our bank account. The lesson here: Let your merchant account know when you expect a boost in volume. If you’ve got a big launch, give them a heads up. Let them know nothing fishy is going on and you might save yourself some headaches.
Ecommerce With a Third Party Processor
While the payment gateway and merchant account combo are the most common in ecommerce, there are also third party processors. The third party processor combines the role of a payment gateway and merchant account into one.
Instead of this:
Shopping Cart > Payment Gateway > Merchant Account > Bank Account
The process is simplified to this:
Shopping Cart > Third Party Processor > Bank Account
Third party processors include PayPal, Stripe and 2Checkout among others.
A third party processor handles both the authorization (can we accept this credit card) and collection of money. It’s a streamlined process that has several benefits, but also some downsides.
Let’s compare third party processors to the standard payment gateway and merchant account:
- Cost: Third party processors generally have higher fees than standard processors. You might be paying a straight fee across the board (usually 2.9% plus 30 cents per transaction) while with a standard processor that rate will vary based on the card used and the volume. A good rule of thumb is if a client is doing more than $3,000 per month then it will make financial sense to go with a standard processor.
- PCI Compliance: Standard processors require very rigorous PCI compliance while third party processors either don’t require it or only have very simple requirements.
- Security: Standard processors require an SSL certificate, while third party processors don’t usually require one (though you might want one anyway to build trust with customers).
- Deposits: Standard processors usually deposit your money fairly quickly, generally within three days and usually automatically. Third party processors can take up to a week and it’s generally not automatic.
- Setup: Standard is complicated and involved. Third party is easy.
- Appearance/Usability: Standard processors give you the freedom to set up your cart and check out experience however you want to do it. Depending on how you do it, this can often be more professional and polished. Third party processors can be more limiting, depending on who you go with. Sometimes you might be stuck with an off-site payment system that’s a drain on your usability. Third party processors are getting better, but sometimes this is still an issue.
In general third party processors are easier to set up and get working, but you pay for it with higher costs and fewer options.
Understanding SSL & PCI Compliance
We’ve mentioned a few acronyms you should probably understand. Let’s walk through them briefly:
When you share information over the Internet it’s generally not encrypted. In almost every case that data is being passed back and forth from server to server across the Internet until it reaches its destination. It’s possible to view that data at any point along the way. That’s a pretty bad idea when it comes to ecommerce, so we have to introduce a layer of security.
That’s what SSL is. It stands for Secure Socket Layer and it’s a protocol that allows a program on your computer to establish a secure connection with a remote server.
Generally you see it when you’re on sites with the ’s’ in http:// Seeing https:// means the data you’re sending back and forth is encrypted so it can’t be scooped up by the bad guys. That’s a must have when you’re sending credit card info back and forth.
SSL adds encryption to the process and keeps your data safe. Setting that up requires getting an SSL certificate. There are several types of SSL certificates, some better than others:
- Shared SSL: This is an SSL certificate that’s shared by all sites on a server. It’s secure and it works, but because it’s shared it doesn’t use your URL and that can cause some trust issues. It’s cheap—sometimes even free with your hosting—but you get what you pay for.
- Domain Validated: This one certifies your domain name so it’s a step up. It can usually be issued within an hour or two and comes pretty cheap, often around $20 per year.
- Extended Validation: This is the top notch SSL certificate. They certify your domain and your business, so it’s more involved and can take longer (a few days to weeks). It also gives the official green bar in your browser so users know your site is secure. You also pay for this level of trust, generally in the $150 per year range.
Any respectable ecommerce site should be using extended validation SSL. Note that this is an ongoing cost for your client and something you might be able to roll into an ongoing maintenance fee.
Once you’ve got SSL set up, WordPress HTTPS is a helpful (and free) plugin that makes it easy to control which pages on your site are secure.
Tip: SHA-1 Encryption
Make sure your SSL certificate is using SHA-1 encryption and not the simple MD5 generated key. The difference between those acronyms is an order of magnitude in security. SHA-1 is more advanced and secure. Cheap and free SSL certificates are often still using the easier to crack MD5.
PCI compliance is another acronym you’ll need to sort out. The full name is PCI-DSS compliance and it stands for Payment Card Industry Data Security Standard. Basically it’s a set of rules about how you handle credit card info to make sure it’s secure. Your merchant account wants you to follow the rules, so they mandate PCI compliance. If you’re not compliant you could face fines and even lose your account.
It’s an involved process and includes a checklist of items you need to make sure you’re doing to maintain compliance. It’s stuff like having a firewall, using good passwords, encrypting data (using SSL), using anti-virus software, restricting physical access to credit card info and more. Some of it is stuff your software can make easier and some will be up to your client and their business practices.
The merchant account will generally tell you what they need for this, but you’ll need to sort out with your client who is responsible for what.
What to Consider When Choosing a Payment System
Now that you understand the basic process for ecommerce you’ll have some choices to make. Do you go with the standard process or a third party processor? Which payment gateway and merchant account do you choose? If you’re going third party, which one do you pick?
Here are a few things to consider as you try to make decisions:
- What’s the client’s sales volume? Remember the magic number is around $3,000 per month. Above that and a standard payment gateway and merchant account is probably going to be better.
- Do you need recurring billing? This can be a powerful feature and rake in more money, but you need to know upfront to make sure it’s an option with your chosen solution.
- Where is the client based? United States, Canada and increasingly Europe have plenty of options. Elsewhere around the world your choices are limited.
- Does the company have a good reputation? Do some research. Google the companies and see what’s being said. If there are lots of complaints about a processor, pay attention. Take online complaints with a grain of salt, but if you see the same issues popping up, be warned.
- What kind of support is available? If you’re somebody who likes phone support, you better make sure it’s offered.
- Does the payment gateway integrate well with a range of products? Will they work with your chosen shopping cart and maybe even your second choice if you’re ever forced to switch? If your gateway only works with a few options, you might be backing yourself into a corner. Also consider how well they work with mobile. That’s another growing market that’s only going to get bigger.
- What are the hidden fees? Make sure you understand all the potential fees—and make sure your client does too, since they’ll ultimately be paying those fees.
Remember there’s no one right answer. You’ll probably decide on different solutions for different clients. But these are the types of questions you need to be asking.
How to Scope & Price Ecommerce Projects
We’ve talked about what goes into an ecommerce project. Now it’s time to get incredibly practical: How much can you charge for an ecommerce project? We can’t give you a dollar amount, but we can help you sort through how to come up with a dollar amount.
First and foremost, there are two things you need to understand at the get-go:
1. Ecommerce Is Big
The moment you add ecommerce to a web development project it becomes exponentially more complex. That means more time and more money.
There are more questions to ask, more components to set up, more players involved. Every one of these variables complicates things and it just makes the entire project that much bigger. It’s going to require more of everything—upfront questions, conversations, setup, coding, testing, expenses.
You need to understand this when you’re figuring out what to charge. Don’t think it’s just a few hours extra work or a couple more questions you need to ask. It’s a whole other level of web development and you should be charging accordingly.
2. Ecommerce Is Not a One-Time Fee
Another important distinction is that ecommerce development should never be a one-time fee. There are a lot of ongoing costs involved and it would be smart for you and better for the client if you include some kind of ongoing maintenance fee as part of your proposal.
- Ecommerce sites need more maintenance. There are more moving parts, more interactions with outside parties where things can go wrong.
- There are annual renewals that need to happen, from your SSL certificate to PCI compliance. The SSL certificate is just an expense and a little time doing the work, but that’s a real cost the site will incur every year. PCI compliance usually doesn’t have a set cost, but sorting it out will take some time and that’s going to cost somebody.
- There are also monthly and annual fees from the payment gateway and merchant account. The client is likely covering these, but somebody needs to be on top of them.
- More than any other site, ecommerce sites have a direct cost for downtime. If the site isn’t making money, that’s lost income. So keeping it up and running at all times is even more important. That’s worth protecting with an ongoing maintenance fee.
This is good for you as a freelancer because ecommerce can create streams of residual money that keep coming in. You certainly have to do the ongoing maintenance and annual renewals, but it’s stability for your business.
It’s also much easier to convince a client to pay a retainer because the site is making money for them. If it breaks, they’re losing money. They need to protect their income stream and they should be willing to pay to do that.
Understanding the Client’s Needs
As you try to scope out a project you need to understand exactly what your client needs. There are so many options and variables with ecommerce that you need to nail down. And changing any one of them can have dramatic affects on the overall work involved.
So you need to do your homework and throw all the right questions at the client.
Here are a few big ones to consider:
- How does the client handle a transaction? This gets into the business management side of things, but you need to understand everything, from how they track sales to what they do with their money. Do they use Quickbooks for printing shipping orders? What kind of software does the website need to integrate with? If the system you create doesn’t fit with what they’re currently doing, there’s a good chance they won’t take full advantage of what you build for them. Craft your solution to best fit how they work.
- Are your client’s products ready to go? How many products do they have? How many variations and options? Who’s in charge of entering all those products into the site? Is there a way to import them? Who checks the import? The number of products can make a huge difference in the size of a project, especially if those products need photos and descriptions. Are those photos good to go or do they need to be cropped or resized? Make sure you have the full price list upfront—you don’t want to be editing products multiple times. The sheer time involved in entering products can delay a site for weeks and if that’s your responsibility you need to include it in the bid.
- What kind of payment options are needed? If your client needs any kind of recurring payment, membership, subscription, etc., then you’re going to have some new issues to consider. Not every payment processor can handle those items, so you need to make sure your plugin and processor can take care of it. Also make sure your client understands how the payment processor works. For example, you can’t get your money from Stripe for seven days. That can cause problems. Be sure to manage your client’s expectations.
- Is the client collecting contact info? An ecommerce site doesn’t have to collect customer contact info, but it’s an ideal opportunity to do so. These are customers who are already buying and it’s likely they could become repeat customers. Your client will probably want to collect email addresses and import those to whatever contact management or email system they’re using. It’s tangential to ecommerce, but it’s a valuable feature.
- What about legacy issues? There are always transition issues with a website, but as usual it can be more complicated with ecommerce. If they have recurring payments on an old system, how will they be transferred to the new system? Will old contacts be incorporated into the new system?
- What kind of timeline are they working on? There are so many moving pieces with an ecommerce site and so many time consuming things that are out of your control that it’s important everybody understands the timeline. If the client wants to get a site up quickly, you need to help them understand that they’ll need to take short cuts—maybe going with a third party processor to avoid the time it takes to get merchant account approval, an SSL certificate and confirm PCI compliance.
- Are all necessary domain names secured? SSL has to be set up for each specific domain and subdomain, so if the client wants their site at shop.clientname.com, an SSL for clientname.com won’t cut it.
- Who is handling copywriting? Do the product descriptions need editing or SEO help? Is the client doing that or do you need to bring in a writer?
- What about training? Ecommerce is complicated and you’ll need to walk your client through everything, show them how it works and make sure they understand the entire process.
- What about new products? Going forward who manages new products in the store? Some clients might want to do this themselves (more training) and others might like it rolled into an ongoing maintenance package you offer.
- What about shipping? Shipping can get complicated and often the variables are based on what’s ordered and how it’s packaged: How much do the items weigh, how many are ordered, do they physically fit in a box together, are they appropriate items to ship together, etc. You should get these details upfront so you can offer the appropriate tools or propose a better solution.
Have you asked enough questions? It might seem overwhelming, but these questions are crucial to getting an accurate picture and giving a good price—one that won’t ridiculously overcharge the client and one that won’t have you losing your shirt.
Testing & Approval
With ecommerce testing is crucial. Money is on the line and every little hiccup or delay erodes trust and could send shoppers clicking away. If anything is confusing or misleading, that’s money down the drain. You need to include time and money for the appropriate testing to happen.
You should be stopping at every major point along the way to test the site and get approval. The longer you go without getting the client’s feedback, the more work you’re making for yourself when they raise a concern.
Get approval and do testing all along the way:
- Design and layout of the site (theme).
- Usability of the site (plugin).
- Product purchase experience (payment processor).
- Test the entire site and all the pieces together.
You should also be sure not to test the site yourself. This isn’t merely testing to make sure nothing is broken (though that’s important), it’s usability testing to make sure most users can use the site without a problem. You built the site, so you better not have a problem using it. You need to bring users who have never seen the site before and have them try to make purchases. Give them something specific to buy and test credit card numbers so they can try the entire process. Hire some testers if you need to, just make sure it’s part of the project budget.
Know Your Margins & Markup
As you’re pricing your ecommerce project there are a lot of variables involved. Whether you’re doing a per project or hourly rate, you should know how much time the project will require and have your price appropriately marked up. More than just your time, you’re paying for your own overhead—rent, utilities, computers, etc.
On top of the simple coding and management time involved, there will also be a lot of extra expenses. This is where you can markup the cost and make more money. You’re taking the time to handle each expense for the client, so it’s perfectly reasonable to make some extra money on that process. This is where you need to know your margins and can have some negotiating flexibility.
Know how much all the extras will cost—domain names, SSL certificates, hosting, etc. Know how much you’re going to mark it up and that will give you the margin you have to work with. Use these margins to close the deal. You can negotiate a lower cost on domain names in order to get the project.
In some cases you might want to use the extras as a loss leader—throw in domain names for free and eat the cost for the sake of getting a long-term deal with a client. They save some money upfront but you make out in the end with an ongoing contract.
But this only works if you’re familiar with your margins and know what room you have to negotiate.
Final Thoughts on Pricing
Coming up with a price tag for an ecommerce project is a job in and of itself. There’s a lot to consider and it’s important you get it right.
As you go about selling your services, remember to focus on what makes you unique. You can charge more for the skills that set you apart, so be sure to emphasize them.
Remember a good ongoing client relationship is about mutual gain. You’re not just designing a site and moving on. You’re working together and when they win, you win. That’s a good retainer relationship.
It’s easy to under-scope these projects, so put in the necessary time and ask all those tough questions. You can’t over-think an ecommerce project. And if you do get stumped, ask for help. Have a good community where you can lay out your situation and ask what you’re forgetting. We often have those discussions in the iThemes Training forum.
It’s a lot of work to price and secure these projects, but it’s worth the effort. When you do it right you form a great long-term relationship with your client. You’re building something that directly makes money for them. People remember that.
Ecommerce projects are bigger than regular web development projects, so you’re going to need a bigger toolkit.
There are three basic tools you’ll need for any ecommerce project:
You need a rock solid WordPress theme you can work with. It should be something that’s continually being updated by the developer. It should also be something you’re familiar with and can manage. You’re going to be doing a lot of custom work so you need to know the ins and outs. You want something flexible you can build on top of. It should make your development easier and faster.
You want a solid plugin you can trust. Make sure you find one that’s in continual development. You don’t want to rely on a plugin that’s no longer being updated. Your reputation is on the line so make sure you’re picking a plugin that can deliver. You might have a couple go-to plugins depending on your client needs, but you need to be familiar with them and know how to make them do what you need.
See this Shopping Cart Roundup PDF for a comparison of plugins.
You need a payment processor your clients can use. Just because you like a particular processor doesn’t mean your clients will. You can have a recommended option, but you’ll need to be flexible. Some clients will want a standard process with a payment gateway and a merchant account. Others will want a quick third party solution. Still others will come with their own merchant account ready to go. You need to have recommendations and be flexible enough to find something that works for your client.
Domains, SSL & Hosting
There are three foundational things any ecommerce site will need—domain names, hosting and SSL certificates. These are also three services you can provide and markup, creating extra margin and making more money.
Every website needs a domain. This is a renewable expense and something somebody needs to oversee. There’s nothing more embarrassing for a website than losing their URL. This is another ongoing maintenance task you can take care of for clients.
In addition to the main domain, you should recommend some alternate URLs—misspellings, similar names, etc.—your client should also own.
There are plenty of places to pick up domains, though we recommend Dynadot.
Every website also needs solid hosting. For ecommerce this is even more important. Downtime or even a slow site will mean lost revenue for your client, so getting quality hosting is imperative.
This probably means you don’t want a shared hosting environment. Your clients need more security, speed and peace of mind. Go with a VPS—virtual private server—to get all those benefits without a huge hit to the budget. It will cost more, but you’ll get much better hosting.
We go into more detail on the different kinds of hosting in our ebook How to Pick Web Hosting Without a Computer Science Degree.
We recommend Site5 for hosting.
Finally any ecommerce site should have an SSL certificate for security and to build trust with customers. There are several places to get an SSL certificate, including:
Stats are important for any website, but they become even more crucial for ecommerce (we’re starting to sound like a broken record—have you gotten the picture that ecommerce really takes thing up a notch?). You can use stats to track the purchase process and discover where customers are abandoning their carts. That’s valuable data because it can literally translate into more money for your client.
You should set up Google Analytics for every site and use Google’s funnels to track the purchase process. Learn how funnels work so you can take advantage of the data. With that data in hand you can come back after the site is live and optimize the purchase process. This can be a service you offer to existing ecommerce sites or something you roll into your ongoing maintenance package for new ecommerce sites.
This kind of data optimization is low hanging fruit. It’s easy to track and you can use data to narrow in on the problems and find a fix. Keep tracking the data to see if your fix worked or if there’s something else you can tweak. Every improvement that lowers the cart abandonment rate means more money for your client.
Here are some additional resources that can help you develop ecommerce sites:
- 3D Package – An online tool to give digital items that look of realism with 3D package images.
- Boxshot – Software to create realistic 3D mockups.
- Better Product Photos – A tutorial for shooting better product pictures.
- Usability Hub – Do quick online user tests. Their five-second test can give some pretty useful results without a ton of work.
- UserTesting.com – Full-blown user testing. This is the more expensive option, but it will give you valuable results, including video of real users interacting with your site.
- Crazy Egg – Heatmaps to see how people use the site and the ability to do A/B testing.
- Clickdensity – Another heatmap tool that works with Google Analytics.
- Wordle – A simple tool to create a word cloud, which can be a quick way to show clients whether their copy is delivering the right keywords.
Know Your Limits
You’re going to need to expand your toolbox for ecommerce, but you also need to know your limits. There are some things you may not be good at or don’t like doing. That’s fine. But find someone who can.
Smart entrepreneurs hire people to do what they’re not good at. If you don’t do writing, find a copywriter. If you like to focus on development, bring in a designer for the look and feel. If testing isn’t your thing, find a way to outsource it.
Hire people who are good at what you’re not.
First Steps for Getting Started
We’ve covered a lot of stuff. Hopefully you now have a good idea how you can specialize in developing WordPress ecommerce sites.
Here are your first steps for getting started:
Take the opportunity to learn whatever it is you need to learn to be successful. We’ve covered the basics to familiarize you with the landscape. Now you have to take the next steps:
- Check out our other ecommerce ebooks: Join the Club: How to Create a Membership Site, How to Create Your First Ebook and WordPress & Ecommerce.
- Take a look at our ebooks on freelancing: Essential Career Advice for Developers, A Business Plan Primer for WordPress Web Designers, So You Want to Be a Freelancer and Turning Contacts Into Contracts.
- Consider joining iThemes Training for ongoing training. It’s a great way to keep your skills sharp and pick up some new ones as well.
Doing ecommerce with WordPress happens with plugins, so you’ll need to get familiar with them. There are plenty of options, including Easy Digital Downloads, WooCommerce, Shopp, WP-Ecommerce and, of course our own, iThemes Exchange. Every plugin has its pros and cons and some will work better in some situations where others will excel in other areas. You’ll want to find a plugin you’re comfortable with and learn its ins and outs.
It also might not be possible to work with a single plugin. You might run into a client with specific needs and find that your favorite plugin isn’t the best one for the job. Or your client might have a payment gateway only a few plugins can work with. Get familiar with the plugins available and be prepared to offer your customers the flexibility to give them the best tool for their site.
3. Be the Example
Build ecommerce into your own site. Be the example and show your clients how it’s done. Not only is this modeling good behavior, but it gives you some practice. Offer online billing, recurring payments and sell your services online. Show your clients how it’s done.
4. Find a Beta Client
If you’re going to get into WordPress ecommerce you’re going to need some experience. Find a client you can learn and grow with. Give them a cut-rate deal to be your first client and be some of your first mistakes. Find a client with some simple needs so you can start out small and then expand as you go. You might volunteer your services to a nonprofit. However you do it, get some experience under your belt.
We believe there’s an incredible opportunity with WordPress and ecommerce and the time to strike is now. But we’re not going to sugarcoat it. It’s going to be a challenge. While this field is wide open, there’s a tough learning curve and a high barrier to entry. You have to know your stuff.
But it’s worth going up against those odds because there’s so much potential for growth.
Make sure this is the right fit for you and your business. It’s easy to get excited about the opportunity, but if it’s not a good fit it’ll never work. Ask the tough questions and make sure this is something you need to pursue.
If it is a good fit and you’re up to the challenge, dive in. This field isn’t going to be wide open forever, and those who dive in first and make a name for themselves will find ongoing success.
Kristen has been writing tutorials to help WordPress users since 2011. You can usually find her working on new articles for the iThemes blog or developing resources for #WPprosper. Outside of work, Kristen enjoys journaling (she’s written two books!), hiking and camping, cooking, and daily adventures with her family, hoping to live a more present life.