There are many different technical elements that go into building and managing an ecommerce site which many cheap web hosting companies tend to gloss over gloss over when you sign up for a hosting package. If you are planning on starting and ecommerce business, or have set up an ecommerce website and have basic technical questions, here is an ecommerce guide that may help you get started with an ecommerce site or answer some of your current questions about them.
Ecommerce sites are complicated in the fact that besides creating a professional looking site that has to get high rankings, you also have to set up a site that is navigable and trustworthy enough to get customers to actually give you their credit card number in order to make a sale. On the technical end, this means that the shopping cart and the credit card processing have to work right. Online shoppers also have a lot to compare your website to. So, especially when you are competing against major retailers that have unlimited resources to spend on their websites, the competition can be somewhat daunting. However, with a correctly functioning ecommerce website, you should be able to make sales from the people who visit your web site and want to buy your product.
There are four technical elements that you need to have in place to sell products directly from your site without having to get physically involved yourself. These four parts include the shopping cart, a payment gateway, a merchant account, and an SSL certificate. If you sign up with a cheap web hosting company, they may be able to supply you with a shopping cart, a payment gateway, and possibly a shared SSL certificate, but not a merchant account. So let’s start with the shopping cart and look at exactly what it does.
Setting up a shopping cart is the easiest part of an ecommerce site because most of them are free and open source software. They also come with your free sitebuilder if you sign up for a cheap web hosting plan, so even if you don’t know anything about web hosting you can have a shopping cart. The most popular carts are Zen carts, Agora carts, and OS Commerce carts, but whatever cart you want to use is a matter of preference; and since they are basically free, you can change your shopping cart whenever you want. Simply put, a shopping cart is the icon on your website where people can drop items they want to purchase during an Internet session. The shopping cart will keep a list of the items and add up how much they cost. You can also customize your shopping cart to do other things like calculate coupons, give quantity discounts, add shipping and handling, and provide other services that you might find as customers check out at a traditional brick and mortar store. The shopping cart in located in what is called the storefront or the part of the website that is accessible by customers. This is as opposed to the administration area, which is only accessible by the web master.
Once your customer is ready to commit to the sale or check out, they need to give you some form of payment, which is generally by credit card or an electronic payment like Pay Pal. This is where the second element that you must have for ecommerce comes in to play. This is the payment gateway, which is the service that sends out the customer’s credit card information and gets it approved for payment. It is accessed by your customer when they hit the ‘submit order’ button you have created on your web site. This is the service that connects your web site to your merchant account. The payment gateway goes with the SSL certificate, which is the third part, or security part of your ecommerce web site. This is where it gets tricky, because this is where you have to pay for these services – and every company charges differently.
When you sign up for a plan with a budget web hosting company, you will sometimes get a shared SSL certificate and usually a shopping cart, but these don’t necessarily have anything to do with transferring credit card data securely over the internet. The shared SSL certificate that is free may have more to do with the fact that you can verify that there is security on the server where your web site is located. Some banks will request this when you sign up for a merchant account. In order to get security for the transfer of credit card information, you may have to sign up for a service like VeriSign, Authorize.Net, PayPal, or another authorization service that you can find that will process your credit card payments and deposit them into your merchant account. Most people who are new to the ecommerce and sign up for a low cost web hosting account get upset when they realize that there is more to taking credit cards than just paying the monthly web hosting fee that is charged by the web hosting company. This is generally because the web hosting packages are often advertised as ‘ecommerce ready’ which is correct to a certain extent, but can still be a misleading phrase to use.
So, when you sign up for your affordable web hosting package, you are going to have to ask if your plan has an SSL certificate, and if it does, if it cover s the secure transfer of credit card information and if this includes a payment gateway that can be used to connect your website to your merchant account at your bank. If it does, great! Make sure to get all of the details. If it doesn’t, you will have to buy the payment gateway and SSL certificate separately from your hosting account. This can be expensive, but is necessary to encrypt credit card information before you send it out over the Internet. The general rule is a 128 bit to a 256 bit encryption code, which is what most credit card processors use.
Once you have a shopping cart set up and a way to process credit cards, you will have to set up a merchant account with a bank. A merchant account with a bank is simply a deposit account that observes the rules for deposit as set forth by MasterCard and Visa. If you want to accept American Express and Discover Card, you will have to contact them separately. When you set up a merchant account, you will have to sign a contract. Be careful when you sign a contract with a bank because they will abide by the contract with no exceptions. The contract may be for a certain amount of years, and you will have to pay some sort of transactions fees and probably a monthly fee that will be in the contract that you sign with your merchant account holder.
Transaction fees may be priced per transaction or as a percentage of the transaction, like one percent of the gross sale. Always shop around for the best deal, and be aware that you are personally responsible for the merchant account – so if your credit is bad you may be charged a higher transaction rate. You are also responsible in the fact that if you have a chargeback from a customer that was not happy with their product and that you failed to resolve the issue, the amount will be subtracted from your account and you will be responsible for the funds. As well, if you are found to be committing credit card fraud – including numbers being stolen from your site and charged on illegally, you can also be required to pay back the fraudulent charges. This is the reason why you need to be careful about the validity of your SSL certificate. Don’t take it for granted that just because your cheap web hosting company offers you one that it is secure enough to prevent credit card fraud.
Remember, there are also security issues on your web hosting site as well. You should never, ever store credit card numbers on your server. If you need to keep them for reference, they should be stored on a file on a computer that no one has access to. If you have a shared hosting plan, you have to be extra careful when it comes to security, because anyone who shares your server can start hacking into other web sites if they have enough time on their hands and they know what they are doing. As well, sometimes shopping carts have security issues, which you should read up on before you decide which shopping cart you are going to use. When you let people shop with you, you will have their shipping address, phone number, and banking information all in the same place. This is a big responsibility, and one which you will be held responsible for if there is a case of identity theft and the victim or the state decides to press charges.
Once you have everything in place – the shopping cart, merchant account, and payment gateway/SSL certificate, this should have you up and running and able to accept payments on your ecommerce web site. It’s probably better to start with a simple shopping cart to see how it works before you try anything complicated. As well, don’t forget to test your check-out system every once in a while to make sure the entire credit card process is working.
