How to Start a $750K/Month eCommerce Business (2024)

  • Brandon Boushy by Brandon Boushy
  • 1 year ago
  • Blog
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online store coming out from a mobile phone with ecommerce business concept

If you want to become a small business owner, you’ve probably been inspired by plenty of e-commerce services that you’ve seen succeed. Ecommerce is one of the easiest businesses to get into, but that doesn’t always mean it’s easy to achieve profitability.

We talked to Michael Jackness, the cofounder of EcomCrew. He got into ecommerce in 2012 by creating treadmill.com and has been doing it ever since. EcomCrew teaches people how to start an ecommerce business on Amazon, but the lessons he shares can be applied to every business. Get ready to learn how he makes nearly $1 million take home across his e-commerce websites.

Welcome to ecommerce for beginners.

What is E-Commerce?

Ecommerce is an online business model to buy and sell goods or services by accepting electronic payments. IBIS World expects U.S. companies to surpass $1 trillion in revenue from eCommerce this year and expects 7.7% growth through 2027.

E-Commerce businesses are typically broken down into two types: 

  1. Business-to-Business (B2B): Businesses that provide services to other businesses. They sell software, educational materials, services, and digital products. 
  2. Business-to-Consumer (B2C): Businesses that provide products and services to shoppers for personal use. These companies span all industries.

We’ve put together a comprehensive blueprint for starting a small e-commerce business. We’ll share videos, articles, and podcasts based on the most important tasks you’ll face when starting an ecommerce business from scratch.

How To Start an eCommerce Business Online

We’lll discuss a list of things needed to start a business in ecommerce. To start a small ecommerce business, you’ll need to:

  1. Generate eCommerce Business Ideas
  2. Establish the Market Demand
  3. Research Other Online Marketplaces
  4. Write an E-Commerce Business Plan
  5. Choose a Name And Logo 
  6. Register Your E-com Business
  7. Create Your Website
  8. Establish a Shipping Strategy
  9. Begin Marketing

How does e-commerce work? Get ready to find out!

Step 1. Generate eCommerce Business Ideas

young woman holding a sign board

The first step to starting an eCommerce business is brainstorming business ideas. Michael told us:

Picking the right niche and market is really important. It’s gotten more expensive to get the customer, so you need to be able to sell to them more than once.

He also explained you want to choose products that:

  1. People are passionate about.
  2. Are disposable.
  3. Pair with complementary products that are easy to produce.

Michael also warned:

The window is closing on what I call ‘me too’ products. It is so easy to recreate products these days that you should create major upgrades or create package offers to make it more difficult to copy.

Check out our interview with him below.

Whether you’re selling subscription boxes, digital products, or starting an online mattress company, there are e-commerce business examples to get you started.

Find out the best strategies for starting an eCommerce store. We’ll show you how to make up to a million take home by selling digital products online. Get advice from someone who has already done it!

E-Commerce Business Models

An e-Commerce business will typically involve selling products or services. There are five basic e-Commerce business models that business owners use:

  1. Start A Digital Product Ecommerce Store
  2. Sell Physical Products From Other Companies
  3. Sell Your Own Products
  4. Print-on-Demand
  5. Start an Affiliate Marketing Business

Keep reading to learn more about each of the ecommerce business models to decide which is right for you.

Start A Digital Product Ecommerce Store

If you want to start an e-commerce business, you might want to consider selling online courses or other digital products. Companies that use the “build once, sell forever” strategy can be highly profitable. 

Check out our interview with Jacques Hopkins who started an online course to help customers learn to play the piano. He went from a $150 investment to making $40K/month.

Sell Physical Products From Other Businesses

This type of e-commerce business focuses on selling products or services that are purchased from a distributor. You’ll need enough space to hold inventory for products to sell. Michael offered an alternative:

I always recommend starting on Amazon. They have everything that makes a good ecommerce site: Eyeballs, Fulfillment, and Traffic.

Check out Fulfillment By Amazon

You’ll find it easier to get started because Amazon offers exceptional customer service and knows how to market to its existing customers better than most businesses.

When looking at e-commerce business ideas, Michael explained that larger products have a higher barrier to entry because they take up more space, but that also means less competition.

Sell Your Own Products

woman hand paying a money into a mobile phone with product illustration

If you have the mind of an inventor, this is the business model you’ll want to use. We interviewed Jason Hernandez, whose Pooch Selfie product has made over $250K.

Some ecommerce business ideas that use this model include: 

Check out our blog about how to create a product for more information.

Print-on-Demand

One of the easiest ways of starting an eCommerce business is by using a print-on-demand company like Printful. In this business model, the e-Commerce process is really simple and consists of:

  1. Creating the artwork
  2. Choosing the products you want to sell
  3. Adding the artwork to the product
  4. Setting the markup
  5. Integrating Printful with your e-Commerce platform(s)

When you sell online, Printful prints the product(s) and ships them to the customer.

This is the easiest option to start an e-Commerce business because they handle everything related to the production and shipping of the products.

You can focus on marketing and other tasks that help grow your e-Commerce store into a successful small business. If you have tech, marketing, and design skills, this is the best online business to start.

Start an Affiliate Marketing Business

screenshot of affiliate marketing software from techradar website

This is the e-Commerce business to start if you’ve ever wondered, “How do I start an eCommerce business with no money?”

Affiliate marketing is similar to e-Commerce but is typically used by tech companies for purposes of growing their sales force at a low cost.

Basically, you recommend the products or services to other people or companies and get a percentage of each sale you generate.

Tech Radar has a great list of affiliate marketing opportunities for beginners. Check it out to try some for yourself.

Connective eCommerce

The best way to sell something is to connect with people. An example of ecommerce business operations that uses this strategy is eCom Babes, the company that originated the term connective commerce. This strategy is focused on three principles:

  1. Use templates instead of hiring developers.
  2. Don’t store inventory or ship it yourself.
  3. Drive traffic with FREE marketing strategies.

Keep reading for more info on how to start an online ecommerce business.

Step 2. Establish the Target Market for The Online Business

man working on a laptop

Once you’ve chosen the e-commerce business idea you like, the next step is identifying how many potential customers there are.  Small business owners might find identifying the target audience easier than others. For instance, an e-commerce business idea selling clothes has a wide population of potential customers, while an online store that sells a keyword list for businesses selling didgeridoos will have a much smaller target market.

Learn everything you can about your customer base so you can speak their language. You’ll want to understand:

  • Where potential customers look for information
  • What search terms people use 
  • Income
  • Jobs
  • Marital status
  • Industries your customers work in

You might be able to eliminate some of your potential ecommerce business ideas based on the total addressable market, which is the value of the market if you were able to take 100%. Learn more about market research.

Step 3. How to Research E-Commerce Companies In Your Niche

Before you start your own ecommerce business, you’ll want to analyze competitors of your business idea. It’s important to compare major players and small businesses in your niche. Analyze the ways online sellers:

  • Offer their products: Options include direct-to-consumer, subscription boxes, discounts, free shipping, and rewards programs for loyal customers.
  • Pricing strategies: Take note of the prices they charge, shipping strategies, and subscription box pricing.
  • Marketing strategies: Take note of how they attract customers using social media ads, search engines, and other platforms.

The goal is to identify gaps in online advertising that you can use to generate revenue. Check out Buffer’s competitor analysis guide for more information on researching competitors.

Step 4. How to Write An eCommerce Business Plan

infographic of three person holding a text box

According to Harvard Business Review, entrepreneurs who write an eCommerce business plan are 16% more likely to be successful. That’s not surprising because an eCommerce business plan guides decision-making and helps get financing.

At a minimum, a business plan for an e-Commerce business should explain:

  1. How you came up with the ecommerce business idea
  2. The problem the new online business solves
  3. Why your ecommerce business idea is the solution
  4. A detailed overview of the ecommerce space and how you’ll fit into it
  5. Your organizational structure
  6. How the e-business will operate
  7. How you will drive traffic to the website and guide people along the customer journey
  8. Your progress as an ecommerce entrepreneur
  9. Your budget and what you’ll spend it on
  10. Your funding needs, how you’ll get them, and what you’ll spend any borrowed money on

To learn more about writing a solid ecommerce business plan, check out how to Write a Business Plan.

Step 5. Choosing An eCommerce Name and Logo

people choosing a business logo on tablet

You’ll need to select the eCommerce business name. Naming your eCommerce business impacts the following areas of your business:

  • Trademarks
  • Registration
  • Domain name (the home page of your ecommerce website)
  • Social media accounts
  • Packaging
  • eCommerce marketing

Try our eCommerce business name generator to get ecommerce business name ideas. Once you find one you like, just click on it and see how much it costs on NameCheap.

Step 6. How to Register Your E-Commerce Services

You need to establish the legal structure for your e-Commerce business.

For best results, hire legal representation that has experience starting a business, like an attorney, accountant, or tax specialist.

They’ll help you get your business started quickly so you can focus on getting your store up and running.

Licenses, Permits, and Tax Forms

screenshot of licenses and permits application fromsba.gov website

Each location requires different licenses, permits, or tax forms. Use the SBA License and Permits page to identify what your business needs. Keep reading for information on different legal structures.

Sole Proprietorship

A sole proprietorship is the easiest way to begin online selling, but the structure doesn’t protect the owner’s personal assets from legal issues.

That means if something goes wrong, you could lose both your store and your home.

As soon as customer purchases pick up, I’d recommend converting the business to an LLC.

Limited Liability Company

An LLC is the most common business structure used in the United States because the company protects the owner’s personal assets. An LLC requires a document called an operating agreement which is formed with the Secretary of State.

If these types of business structures don’t sound like the right fit for your product idea, check out other business types.

Apply for an EIN

screenshot of ein application from irs.gov website

Every business operating in the United States needs an employer identification number. It’s like a social security number for your business.

Apply for it on the IRS website. It’s used on tax forms when filing taxes and to link employees’ pay to the proper employer.

State/Local Business Licenses

Research license requirements at the state and local levels to identify what your business needs. Each location is different and will have different requirements. The SBA is the best place to find your local business offices.

Unemployment Insurance

hand holding a tiny umbrella with an office box beside

The U.S. Chamber of Commerce has a ton of information on unemployment and also offers links to each state agency that handles state unemployment.

You’ll have to pay $420 per employee on a federal level plus any state UI.

Step 7. How to Set Up An eCommerce Website

Selling products online is a complicated process. You’ll need to create your own ecommerce store using e-commerce websites like:

  • Amazon ecommerce: Use Sell on Amazon to get your online ecommerce business on the largest ecommerce website.
  • Woocommerce: If you have used WordPress before, you might find Woocommerce the easiest place to create your own website.
  • Shopify: Shopify is one of the easiest-to-use online store platforms on the market.
  • SquareSpace: Squarespace is another operator owned platform.

Step 8. Create A Shipping Strategy

delivery guy holding a shipping boxes

There are a few ways to sell products online and ship them to your customer base. Unfortunately, an online store has to compete with Amazon Prime membership which guarantees 2-day shipping for any products stored in Amazon fulfillment centers. That means a successful brand needs to either:

  1. Offer Online Customers similar results.
  2. Manage customer expectations.

That’s why Michael suggests starting your new business on Amazon. Then you don’t have to compete with the largest online marketplace because you’re part of it.

If you choose to handle shipping independently, I strongly suggest you read this article from a fulfillment center about what goes into shipping.

Step 9. Begin eCommerce Site Marketing

Now it’s time to start marketing your own business. I should warn you that e-Commerce marketing is an extraordinarily competitive field. Given that all competing e-Commerce businesses are trying to sell to similar customers online, you’ll have to stand out to your target audience in order to make sales.

Companies use a ton of different marketing strategies. A successful business will often test different strategies to find what works best for them, then focus on that marketing segment. Strategies used in e-Commerce marketing include:

  • Social media organic marketing
  • Paid ads
  • Search engine optimization (SEO)
  • Email marketing
  • Affiliate
  • Influencer marketing
  • Content creation
  • Public relations

Social Media Organic Marketing

woman coming out from a mobile phone screen with socmed icons floating around

Everyone says that if you are looking for future customers the place to be is TikTok. It’s experiencing rapid growth, and small business owners can’t really afford to ignore it as part of their marketing strategy. 

Whatever route you take, make sure your ecommerce marketing focuses on creating value for customers. Nobody wants to feel like they are being pressured to purchase new product ideas.

For a great overview of where to reach different demographics, check out this overview of 2021 social media marketing.

Paid Ads

Advertising your ecommerce business using paid ads can be highly profitable.

If you’re going to run paid ads for your ecommerce business, hiring an advertising agency can be highly beneficial because they should already know how to create successful ecommerce business ads. If you run your eCommerce ads yourself, I recommend taking training from the platform you’ll be using. 

Search Engine Optimization (SEO)

person working on a laptop

Search engine optimization is focused on making your eCommerce business easy for both people and search engines to understand. When you do this well, your website ranks higher in search engine results.

Here are some SEO best practices:

  • Use keyword research tools like Ahrefs Google Trends, or Keyword Surfer
  • Drive your content strategy with keywords.
  • Specify metadata for pictures and websites. Moz has a great article on this.
  • Limit each product page’s size to less than 2 MB.
  • Limit load time to less than 3 seconds.

Email and Text Message Marketing

Collect emails of visitors to your ecommerce store by offering a discount. Once you’ve collected an email, you’ll want to:

  1. Save the email in a database.
  2. Send the customer automated and personalized emails routinely. 
  3. Track results using analytics.

I’ve used SendGrid and Mailchimp, but you’ll find additional ideas in this guide on the best email marketing software. Big Commerce also has a great guide on email marketing strategy.

Affiliate Marketing

two young woman promoting on a megaphone

Affiliate marketing is essentially outsourcing your sales department. You offer other marketers the ability to refer customers in exchange for a commission from each sale.

You’ll need to create messaging and creative-use guides to specify how affiliates can and cannot market your eCommerce business. You may also want to create content of your own and just have them share it. OptIn Monster explains how to set up an affiliate marketing program.

Influencer Marketing

Hiring celebrities or people well known within your niche to promote your products is another form of ecommerce marketing that can help an online store sell more products. BigCommerce found that 89% of businesses get comparable or better results from eCommerce influencers than other forms of marketing.

You’ll need to:

  • Reach out to potential influencers.
  • Offer them free products.
  • Pay a fee for sharing your eCommerce products.
  • Use analytics to monitor posts.

Learn more about how to find influencers in Alexa Blogs.

Jason of Pooch Selfie recommended:

It’s less expensive to hire 10, or even 100 micro-influencers, than it is to hire the Kardashians.

Content Creation

man working on a laptop

 

Content creation includes blog posts, videos, memes, and written content on your website or social media channels. Content creation helps the ecommerce customers get to know you, then trust you.

Consider reading our blog about starting an advertising business because many of the skills for ecommerce success are the same for advertising.

How Much Does It Cost To Start An Ecommerce Business?

Starting an e-Commerce company doesn’t have to cost a fortune. We’ve talked to many online store business owners and the costs for an ecommerce startup range from $1,000 to $250,000.

In our interview with Marcus Harvey from Portland Gear, Marcus suggested beginners use the following low-cost plan to start an e-Commerce business:

  • Open a store on Shopify
  • Select a print-on-demand company. (I find Printful easy to use.)
  • Budget for social media marketing of less than $500/mo.

If you’re short on cash, another option is securing startup capital through crowdsourcing. Jason used Kickstarter to raise approximately $7,000 for an injection molding tool.

He told us:

I got no hits for about a week, but on the 7th day Buzzfeed released an article about my idea and my phone started exploding with contributions. I ended up raising about $40,000 within the month.

Keep reading for more ideas on securing funds.

How To Get Funding For An E-Commerce Site

From a funding standpoint, common funding paths include:

  • Personal funds, savings, 401K loans
  • Loans from family or friends
  • Crowdfunding 
  • Credit cards
  • Business loans
  • Home equity loans
  • Rollover for business startups (ROBS). (similar to 401K loans, but with different requirements)

I think it’s worth noting that the majority of these options will involve contracts, and you should search “corporate lawyers near me” to ensure you approach these legal requirements with someone knowledgeable on your team.

Check out our article on business funding for more information on how to fund your eCommerce business idea.

How to Start Selling Products

woman showing an online store order on a tablet

Selling your products in e-Commerce is focused mainly on marketing and managing your inventory. Once you have your products and your marketing is running, you should see sales coming in.

E-Commerce Frequently Asked Questions

How Do I Start an eCommerce Business With No Money?

Most ecommerce business platforms offer a free trial period to get started. Search for the free trial and start a new eCommerce business idea today. Affiliate marketing and digital products are some of the easiest ecommerce business ideas to get started for free.

How Many Ecommerce Stores Are There?

According to IBIS World, there were approximately 341 thousand ecommerce sites in the United States in 2022. That number is expected to grow by 10.9% each year.

How Many Ecommerce Businesses Fail?

distressed woman with failing business concept

There are statistics that say 80 to 90% of ecommerce businesses fail, but based on an analysis of the startups in IBIS World reports, this figure is too high. It’s more like 33% to 60% fail in the first 5 years.

Major Ecommerce Players

The top four ecommerce businesses account for 27% of the market’s revenue and 33% of the profit. These are the businesses that set the standard for online stores:

  • Amazon: $156.4 billion revenue and $10.8 billion profit
  • Walmart: $33.4 billion revenue and nearly $2 billion profit
  • Apple: $31.3 billion revenue and $5.3 billion profit
  • Ebay: $5.5 billion revenue and $376.9 million profit

Ecommerce Industry Information

If you’re looking for the best information impacting ecom businesses, check out these resources:

Software for E-Commerce Companies

mobile phone with a floating eCommerce logo

If you’re looking for some useful software for e-commerce businesses, check out some of the software below.

  • Klaviyo: Email and SMS marketing automation platform
  • Helium 10: Useful software for Amazon FBA and Walmart sellers 
  • Jungle Scout: Resources and data for Amazon sellers
  • QuickBooks: Financial management software for all types of small businesses
  • Shopify: Leading eCommerce platform
  • WordPress: Free website building and hosting platform ideal for eCommerce businesses

Start Selling Products in Your Online Store!

We’ve covered the basics from what does e-commerce mean to how to start an ecommerce store. We’ve given you all the tools you need to learn while researching how to start a successful e-Commerce business. Hopefully, one day we’ll get to feature your store in Upflip’s videos and blogs!

Make sure to follow us on YouTube and subscribe to our mailing list to keep up to date on what e-Commerce businesses do to succeed.

What would you like to sell online?

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4 thoughts on “How to Start a $750K/Month eCommerce Business (2024)”

  • stream purple

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  • SNK Social Fame

    Such a useful and interesting to read this article, I would like to thank you so much, for share this blog.
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    Reply
  • Eva Rubio

    Great walkthrough on the article about “Best eCommerce Business Ideas to Establishing a Successful Startup.

    https://cutthephoto.com

    Reply
  • William Thomas

    Great article! Niche selection and market research are key. Flexibility in the business plan is crucial. A user-friendly website is a must. SEO and content are long-term game-changers. Scaling and staying informed are vital for success. Thanks for the insights!

    William Thomas
    https://www.perfectretouching.com/blog/can-you-wear-jewellery-in-passport-photo

    Reply

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