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WHY E-Commerce Websites Will Survive the Recession

About the author: Dan Cannon is the Lead Web Applications Developer for Nicasio Design and Development. Nicasio provides web based solutions for both individuals and businesses. Nicasio is highly proficient in WordPress design and development. Nicasio also owns and operates the E-Commerce solution NicE-Comm.

First off, it’s Christmas Eve here in the States, so Merry Christmas to those that celebrate it and Happy Holidays to those that are celebrating other holidays. A while back I discussed how an e-commerce website could survive the recession. Today I will dive into a few reasons why e-commerce is recession proof.

E-Commerce May Be Recession Proof

Customers Are Being Frugal
Most businesses would not think that customers being cheap would be a good thing for business. In most cases this is true. However, typically during a recession, people don’t stop spending, they spend smarter. This is beneficial for e-commerce websites because people believe that they get better deals online and are more likely than ever to make purchases online. This is for a few reasons.

  • Customers can compare prices online (make sure your prices are competitive).
  • They can save gas (this is actually a factor in this day and age).
  • Online transaction security has greatly improved recently, increasing customer trust.
  • Some customers feel that buying online helps save the environment.
  • Buying online is simply more convenient for most customers.
  • Product imaging has improved greatly. Customers can now view hi-res product images and videos in seconds online.
  • Product reviews are now prevalent online. Customers are more likely to buy a product if they can read reviews about it.

Low Overhead Costs
Cutting overhead costs is one of the first thing many businesses do to survive a recession. E-Commerce websites enjoy some of the lowest overhead costs of any business operating today. For small e-commerce businesses you are looking at very low overhead costs each month. Typically the only bills you HAVE to pay as an e-commerce merchant are:

  • Your internet bill – it’s fairly hard to run an online business without an internet connection.
  • Your electricity bill – same as above.
  • Your hosting bill – your e-commerce website probably needs to be online to get sales.
  • Any monthly fees your payment processor may charge
  • For many e-commerce merchants that’s it!

So don’t worry too much about cutting overhead costs. You are already enjoying some of the lowest operating costs of any business model in existence.

Advertising is Cheap and Easy
Compared to many traditional methods of advertising brick and mortar businesses, your e-commerce website can be advertised fairly cheaply.
Here are a few suggestions:

  • If you have free time read up on improving your search engine rankings. This typically requires no more funding than your time. You might want to check out my article on Writing Good E-Commerce Content and Part 2: Advanced Topics as a starting point.
  • Advertise in BrownBook.com. It’s free and they have a great Google ranking.
  • Use Google AdWords. Google allows you to maximize what funds you have to target particular audiences.

As you can see, you can easily and frugally advertise your e-commerce business.

Summary

As you can see from the above points, it’s pretty obvious e-commerce websites are poised to not only survive the recession, but have the potential to prosper.

If you would like to get started with your own e-commerce business you might want to check out NicE-Comm which is a full-featured e-commerce solution developed and maintained by Nicasio Design and Development. Head on over to the NicE-Comm Website to view some of our current and upcoming clients as well as check out our demo store. You can also Contact Us to learn more and schedule a demo.

3 Responses to WHY E-Commerce Websites Will Survive the Recession

  1. Good post, Dan. E-Commerce has been and will continue to be a boon for those entrepreneurs and organizations that get on board – especially in these hard times.

    While e-commerce as a whole is definitely recession-proof, all e-commerce solutions may not be. It’s almost too easy for the average mom-and-pop shop to get online and start selling. It’s also really easy for the average mom-and-pop shop to sink a couple thousand into a web presence and get zero results.

    Luckily, these last few years have been really interesting for web analytics and web marketing. By making a site standards-compliant and tweaking the content and layout (based on quantitative data from good web analytics) one can see some amazing results. We’ve heard of the long tail, so the opportunity is there (hopefully). With a little help from the local web firm, mom and pop can make the best of this opportunity.

    – bryce

  2. Yep, been thinking a lot about this.
    The gist of it is ecommerce has low overhead and (in my case) digital assets. A downturn is a good time to bulk up for the upturn; my work pre-bust was never fully ramped up yet anyway… .
    At any given time, most businesses need to diversify their revenue streams, so this downturn forces the issue.
    So, my plan is to work on the short term revenue (mostly off-line), and keep the long range ecommerce plan.

  3. I also think so
    “While e-commerce as a whole is definitely recession-proof, all e-commerce solutions may not be. It’s almost too easy for the average mom-and-pop shop to get online and start selling. It’s also really easy for the average mom-and-pop shop to sink a couple thousand into a web presence and get zero results.”

    e-commerce Design

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