eCommerce project – a cost or an investment?
Venturing into eCommerce projects is objectively challenging for larger enterprises. Most of them have existing layered procedures about stock management, distribution practices and already stretched ERP or CRM systems
On the other hand, eCommerce provides many business benefits and this reflects on overall 23% Year-Over-Year transactions growth. Moreover, by 2040, 95% of all purchases will be made through online channels (at least by some sources – Nasdaq, 2017)
One of the most repeated questions from the ‘future eCommerce owners FAQ pool’ is whether creating an online shop is an indirect operational cost or an investment? I believe eCommerce is an investment and I will try to elaborate on why is that in few short bullets:
- eCommerce applications are an asset. It is an asset very similar to an HQ building or sales location and in that way it’s a part of the whole business process of distributing products towards consumers. You can look at it like opening another physical store in your country. A store that is fully automated and works 24/7/365.
- Additionally, eCommerce application is indeed like opening a store, BUT in a place where you have never sold before. In essence, eCommerce is a store that generates additional revenue, revenue that you never had before, from customers that you never interacted before. It’s an investment that expands your current market.
- As far as accounting goes, eCommerce application is an intellectual property (IP) seeing that software is an “author’s product” such as a song, graphic or algorithm. If done properly, you will own application user experience, code, database, online know-how, product / user data sets, content and an opportunity to analyze and dissect every step of your eCommerce user funnel. This is a massive IP that you’re bringing as a value to your company and that can be scaled and reflected on other processes or businesses.
- From the salesforce perspective, eCommerce application will help in your promotional effort as it will assist sales in your physical store. It will help to connect with your existing customers as they would be able to easily browse and analyse what they buy in your physical store.
- It will also help your marketing team in generating new loyalty processes, campaigns and promotional materials
All in all, eCommerce application helps you sell more, either directly or indirectly. And please comment below if you have any questions or remarks. Neuralab team is here to help in any eCommerce topics, projects or situations.
Krešimir Končić is the founder and CEO of Neuralab and a longtime columnist for Netokracija. He has been working with software since the mid-1990s, and since 2007 has built complex digital and eCommerce projects through Neuralab for clients across Europe and the United States. He writes about software, artificial intelligence, technology, and the human forces that regularly complicate all of it. He is the author of Coding Is the Easier Part: Makers, Machines, and the Mess in Between.
