Ecommerce Solutions: What are the Options?
By Steph Skardal · Monday, February 28, 2011
Lately, I've been evaluating ecommerce options for use on a side hobby/business. I'm obviously a developer, so in theory I could use one of End Point's supported ecommerce frameworks or just write my own framework. But, my bottom line is that I don't need the feature set offered by some of the ecommerce options out there and I don't necessarily have the resources to develop a custom solution.
In addition to personal interest, End Pointers constantly encounter potential clients who aim to get a better understanding of the cost of using open source, our preferred ecommerce solution. I put together two infographics on ecommerce options, ongoing cost, feature sets, and the ability to customize. Before anyone flips out about the infographics, note that they represent my broad generalizations regarding the ongoing cost, feature sets and ability to customize. I'm intimately familiar with some of these options and less familiar with a couple of them.
Feature Set versus Ongoing Cost of Ecommerce Solutions
Ability to Customize versus Ongoing Cost of Ecommerce Solutions
Some notes on on the ecommerce solutions shown in the infographics:
- Online payment service (Paypal): An online payment collection service like PayPal offers a minimal "ecommerce" feature set and might be suitable for someone looking to simply collect money. It also provides almost no ability to customize. The ongoing cost of PayPal is lower than many of the other options, where a percentage of each sale goes to PayPal.
- Online catalog service (Etsy, eBay): An online catalog service such as Etsy or eBay offers very basic ecommerce listing features, little to no ability to customize, but has relatively low ongoing cost. For example, Etsy charges $0.20 to list a single item for four months and takes 3.5% of the sales fee.
- Hosted ecommerce (shopify, Big Cartel, Big Commerce, Yahoo Merchant): A hosted ecommerce solution offers the ability to customize the appearance, typically in the form of a custom template language and has a basic ecommerce feature set. Ongoing costs would include the cost of the service, domain registration cost, and payment gateway (e.g. Authorize.NET) fees. Additional cost may apply if development services are required for building a custom template. Shopify's basic solution costs $29/mo. with a max of 100 skus. Shopify offers several other higher-priced options which include more features and have less limitations. Most other hosted ecommerce solutions are similarly priced.
- Open source ecommerce (Interchange, Spree, Magento, Zen Cart, osCommerce, prestaShop): An open-source ecommerce solution tends to have generic ecommerce features, provides the opportunity for a large amount of customization, but is typically more expensive than hosted ecommerce solutions and online catalog services. The software itself is free, but ongoing costs of hosting (server, domain registration, SSL certificate), development (any piece of customization that does not fit into the generic mold), and payment gateway fees apply. One positive about open source ecommerce is that additional plugins or add-ons are produced by members of the community. If the business needs are satisfied by the community-available extensions, cost from additional development or customization may be eliminated or reduced. I'd also probably group in existing open source plugins or modules for open source CMS solutions like WordPress and Drupal into this category: the generic solution is free, but additional resources may be required for customization.
- Enterprise ecommerce (ATG, Magento Enterprise): From my experience, I've observed that enterprise ecommerce solutions tend to offer a large feature set and a similar ability to customize as open source frameworks. The ongoing cost is high: for example, Magento Enterprise starts at $12,990/year. In addition to the licensing cost, hosting, development, and payment gateway fees may apply.
- Custom ecommerce (homegrown): The cost of writing your own ecommerce framework depends on the functionality requirements. The ability to customize is unlimited since the entire solution is custom. The feature set is likely to be proportional to resources spent on the project. Ongoing costs here include hosting, development and payment gateway fees.
Which one do you choose?
It has been my experience that most of End Point's ecommerce clients need some type of customization: a custom appearance, discount functionality, shipping integration, payment gateway integration, social media integration, and other third-party integration. Choosing an option that allows easy customization tends to benefit our customers in the long run. We're pretty biased at End Point towards open source ecommerce solutions, but my opinion recently is that with the advancement of web frameworks and web framework tools (e.g. gems in ruby), development of custom solutions can be done efficiently and may be a better option for a site that is outside the realm of standard ecommerce. For businesses not able to pay development or consulting costs, hosted ecommerce solutions are affordable and provide the essentials needed as the business grows.