Choosing an Electronic commerce
shopping carts
Choosing
electronic commerce shopping carts
is a big decision. Unlike a traditional brick and mortar business, your
website is your only chance to impress potential customers. It needs to
project a professional image to capture the trust of your visitors. The
shopping cart is a particularly important part of your website because
it deals with people’s personal information and credit card numbers.
People are nervous about online purchases and need to be assured that
they are giving their credit card numbers to a reputable company.
There are
several types of electronic
commerce shopping carts available. They range from
merchant services, which require no programming skills, to fully
integrated shopping carts that require custom programming. The three
main categories of
electronic commerce shopping carts are:
-
Merchant services such as eBay and 2Checkout
-
Hosted
electronic commerce
shopping carts services
-
Fully integrated
electronic commerce
shopping carts
Merchant
Services
Most
shopping carts require you to have your own merchant account and
gateway. A merchant account is a bank account that allows a business to
conduct credit card transactions and the gateway allows the transaction
to be conducted over a secure connection. It’s okay if you don’t have a
merchant account or gateway. Merchant service shopping carts allow you
to use their merchant account, gateway and shopping cart for a higher
cost.
Merchant
services are beneficial for very small businesses or those that are just
starting and don’t have a lot of orders. Merchant services provide the
merchant account, gateway, hosted shopping cart and will maintain your
customer’s personal information. They usually require a set-up fee
between 50 and 200 dollars, transaction fee between 30 and 75 cents, and
5% to 10% of each transaction. Because you are using their merchant
account, your customer’s credit card statement will show the merchant
services business name not yours. In some cases, customers will not
recognize the charge and may dispute it.
Merchant
service electronic commerce
shopping carts have an administrative interface, which allows
you to login to your account to add products, prices and shipping
options. The shopping cart generates the html for the purchase buttons
and you simply copy and paste the html into your web pages. When your
customer clicks on the purchase button, he is taken to another website
to enter the credit card information. This indicates to the customer
that you are a small business. Some potential customers will abandon the
shopping cart rather than enter their credit card information on a
website they know nothing about.
Once your
business grows to the point where you are processing over $1000 a month,
it’s more cost effective to apply for your own merchant account and
switch to either a hosted shopping cart (little or no programming) or a
fully integrated shopping cart (programming required).
Hosted
Shopping Cart
The
hosted shopping cart is a great solution for a small business that is
processing over $1000 a month but does not have the resources to create
or customize a fully integrated shopping cart. Hosted shopping carts are
similar to the merchant services because they provide an administrative
interface for you to enter products, pricing and shipping options. They
will generate the html for the purchase buttons, which can be copied and
pasted into your html pages.
Hosted
shopping carts face some of same problems as merchant service carts
because your customers will be transferred to a different website to
enter the credit card information. Some hosted shopping carts allow you
to customize the shopping cart so that it has the same look and feel as
your websites. Customizing your shopping cart may require some
programming skills, but it could also prevent customers from abandoning
their shopping carts.
The main
difference between the merchant services shopping cart and the hosted
shopping cart is the name that appears on the customer’s credit card and
pricing. Hosted shopping carts allow you to use your own merchant
account and gateway, which means the customer’s credit card statement
will show your business name next to the charge. This can decrease your
charge backs.
If you
are using your own merchant account and conducting over $1000 of
transitions each month, the hosted shopping carts can be less expensive
than merchant services. Your merchant account will probably charge a
monthly fee between 20 and 60 dollars, transaction fee between 10 and 50
cents, and a percentage of the transaction, usually ranging between 2%
to 3.5%. In addition to the merchant fees, your shopping cart service
will also charge a monthly fee between 10 and 30 dollars and could
charge a transaction fee. These fees sound more expensive than the
merchant service option, but if you are processing over $1000 a month
and growing, it’s better to pay flat monthly fees than continue to be
charged 5 to 10 percent of the each transaction.
Fully
Integrated Shopping Carts
The fully
integrated shopping cart is a great option for any business that can
afford it. The shopping cart will be dynamic and will have the same look
and feel as your website. The ZIP Baby Potty Training Store is a great
example of a fully integrated shopping cart. Fully integrated shopping
carts like this contain features that are not found in merchant service
or hosted shopping carts. For example, you can discount items, display
customer reviews, assign products to multiple categories, display out of
stock notifications, sort products and prices, and display shipping
estimates without requiring the customer to create an account.
Integrated shopping carts require advanced programming skills and can
often be used with your own merchant account or with a service that
allows you to use their merchant account for a higher fee. There are
many integrated shopping carts available. Free carts require the most
programming skills, but if you don’t have the programming skills
necessary to customize a free shopping cart, there are many companies
that specialize in customizing fully integrated shopping carts.
Your
choice of a shopping cart can have a dramatic impact on your business.
Your website is the first and only impression you get to make so you’ll
want to make it as professional as possible. While shopping for a
shopping cart system, put yourself in your target customer’s shoes and
browse the Internet. Review your competitor’s websites as well as those
outside your industry. Make a list of shopping carts that you find
appealing and research them thoroughly before choosing one.
Copyright
2004 Danna Henderson. All Rights Reserved.
Danna Henderson started ZIP Baby in order to provide parents with
comprehensive potty training information and a large selection of potty
training products. For more information visit the ZIP Baby Potty
Training Store
