MerchantSelect
 
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Shopping Cart Solutions

What is a shopping cart solution?

When customers shop in a grocery store they browse the product aisles, choose the products that go into their shopping cart and ‘checkout’. Shopping cart solutions provide customers with a similar shopping experience in the virtual world. Customers enter a web site, select the items they want from a catalog, put them in a shopping cart, and submit the order.

In the past, shopping online meant customers had to fill out a form manually, entering the products they wanted and then adding up the order by hand. Since the introduction of shopping cart solutions, customers can now complete their online shopping experience in minutes.

While the online shopping process may appear easy, behind the scenes the process is not as simple. Unlike a bricks and mortar store, your online store is operating 24 hours a day, seven days a week. Consequently, it is imperative that your site operates efficiently all the time, and that it meets the needs of your customers.

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The introduction of innovative technology solutions, along with customers’ increased awareness and understanding of Internet issues, has led to higher expectations in the online marketplace. Customers want more and are less accepting of inferior products and poor service. If any component of the shopping process is negative, the customer will most likely leave and never return.

The abandonment rate of online shopping carts ranges from 25 percent to 74 percent. Although the numbers vary, they are still indicative of customers’ dissatisfaction with online shopping. There are many reasons why many customers do not complete the online purchase cycle (refer to the chart titled ‘Problems with and Solutions for Shopping Cart Abandonment’).

Problems with and Solutions for Shopping Cart Abandonment
Problem Potential Solution
High Shipping Costs
  • Include costs in product/service pricing.
  • Reduce costs or exclude shipping costs in prices.
Too Much Information to Fill Out Early
  • Ask for credit card details and non-essential information later in the buying process.
Privacy and Security Problems
  • Create links to Trust/Privacy/Policy statements.
  • Provide customers with a choice where privacy is concerned i.e. ask if contact information can be added to the mail database.
Poor Usability and Navigation
  • Ensure site responds quickly to customer commands.
  • Make shopping cart easy to find.
  • Provide a good search mechanism to find products.
  • Make check out process simple i.e. allow easy return to shopping once items are placed in it; provide a method of viewing and removing items from the shopping cart at any time.
  • Notify shoppers when the payment process is temporarily down.
Lack of Interactivity and Control
  • Add online help windows where necessary.
  • Say when the transaction will become final.
  • Provide confirmation of the order.
  • Provide information on fulfillment and delivery tracking.
  • Provide contact information and quick responses.

As a merchant, shopping cart solutions provide you with a way to manage the purchase flow of your customers, keep track of your accounts and integrate your E-commerce activities into your business. However, in order to receive any benefits you need to attract customers to your site, persuade them to buy your goods and encourage them to return. An effective shopping cart solution will not only keep customers on your site but also encourage loyal patronage.

What types of shopping cart solutions are there?

Shopping cart solutions are like jigsaw puzzles in that there are a number of pieces that must fit together to make sense. A complete shopping cart solution includes the following:

  • a merchant account
  • a database server
  • a catalog
  • a web server
  • a storefront with shopping cart
  • a secure payment gateway

Solutions come in various forms - some simply provide one component, such as the shopping cart, while others provide all or a combination of the components. Other additional components include connectivity to legacy systems, which control inventory and management structures, and reporting and administration tools.

Depending on your business needs, you can build your own solution, developing each component separately. Or, you can buy or lease a product, or join a service that incorporates some or all of these components. In any case it important to consider where you will host your web site.

  • Buy the software and install it on your own server.
  • Buy the software and outsource it to your ISP or hosting company’s server.
  • Sign up with a hosting company, ISP or E-commerce provider that has shopping cart software available (lease).
  • Sign up with a service where the software runs off its server.

Before deciding where you host your site, it is important to understand the various software and development alternatives that exist.

Software and Development Alternatives: Buy/Lease a Product, or Join a Service

Turnkey (integrated) Services: A turnkey service means the entire shopping cart solution is developed by one provider called a turnkey provider. The turnkey provider can be a hosting company, merchant account provider, Internet service provider or E-commerce company. In most cases, your site will also be hosted on its server.

Template Service: A template service is an online browser based mechanism that enables you to build your store online through a third party. Essentially, you are provided with a pre-built store (template) and will be required to complete a step-by-step process that leads you through the store building process. Once you add your company and product information to the templates and your store is complete, the finished product will be hosted on the template service provider’s server. In many ways a template service is like a turnkey solution in that it offers all the components required for a complete shopping cart solution. However, there are many more advantages to a turnkey solution, including increased customization, flexibility and scalability.

Software Suites: Shopping cart software suites are essentially “storefronts in a box” since they include all components required for a complete shopping cart solution. The software can be installed on your server or it can be outsourced to an ISP or hosting company. An important consideration is the compatibility of the suite and the server that hosts it.

Electronic mall (E-mall): An E-mall operates like a regular mall in the sense that there are various vendors at one location. The mall essentially acts as a server and the set-up process is simple since the mall will most likely have tools in place to build an online catalog, integrate a shopping cart, and enable online payment.

Storefront Software: Storefront software is a tool that enables you to develop your store. The software can be straightforward or provide enhanced features, but in most cases it will not include all components required for a complete shopping cart solution. As with software suites, the software can be installed on your server or outsourced to an ISP or hosting company. You can also lease the software from a provider that will host the software on its server. Again, it is important to consider the compatibility of the software and the server that hosts it.

Note: To examine the advantages and disadvantages of each, refer to ‘Evaluating Software and Development Alternatives’.

Build Your Own Solution

If you choose to build your own shopping cart solution you will need to consider each piece of the puzzle separately and determine how they will fit together to create an effective solution.

Merchant Account: Enables you to accept credit card purchases.

Database Server: Includes a customer database, which allows you to store information about your customers, and a product database that holds data about your products and services.

Web Server: Houses your web site and works with the Web browser to provide you with the information you want.

Catalog: Displays your products and services on a user-friendly interface.

Storefront with Shopping Cart: Provides customers with a method to select products and services for purchase.

Payment System Processing: Used to calculate taxes and shipping costs while enabling secure and real-time transactions through your site.

Legacy Systems: Database management systems that include forms of hardware and software that a company owns including mainframes, personal computers, networks, databases, operating systems and application programs.

Security: Provides a method to protect customer information i.e. credit card numbers; can come in the form of SSL (secure sockets layer), which encrypts traffic between your Web server and the customer's browser.

Reporting Tool: Records browsing habits of customers including page hits, time spent on sites, purchases and general site analysis.

Administration Tool: Enables you to effectively manage your site i.e. update your product and service information, add promotions.

How do I choose a shopping cart solution?

When developing a shopping cart solution, it is important to buy the software first, and then select a payment gateway and merchant account that is compatible with it. Whether you choose to build you own solution, decide to buy or lease a product, or join a service, you need to consider your business requirements, evaluate the various software and development alternatives that exist and consider a number of important questions.

Determine Your Needs

Skill Level
What is my technical skill level? If you lack technical capabilities and do not have technical resources in-house, outsourcing the entire solution could be the better option. Or, you can buy/lease the software and outsource it to your hosting company or ISP.

Products/Services
How many products and/or services do I sell? If you sell a few products, then it would not be efficient to build your own solution, which is a complex and expensive process. The best option may be to choose a template-based service or join an E-mall.

How complex are my products or services? If you have complex products that require the provision of detailed information to potential buyers, a customized solution may work best.

Business Plan
How quickly do I need to set up my online business? If you want to develop a shopping cart solution quickly then you should not build your own site as this takes a lot of time.

Do I plan on extending my products/services? If you plan to extend your product or service line in the future you need to consider buying a solution that provides high-level scalability and flexibility.

Resources
How much do I have budged for my solution? Building your own site from scratch is the most expensive option. If you want a cheap alternative you could consider an E-mall or template service.

Evaluate Software and Development Alternatives
Options Ease of Set-up Customization Scalability Complexity (technical) Flexibility

Turnkey (integrated) Services

Development is in the hands of the provider

High degree of customization available

High scalability

Provider may require merchant input

- May be more difficult to move to a different Web host

Software Suite

Can be high development effort if implementing on your own without help from your Web host or ISP

Can choose look; more control over the layout and organization of store

Suite usually comes with full shopping cart solution

Scalable (to the extent permitted by the suite)

No integration with inventory systems

Minimal technical skill requirements (when working with an ASP or host)

Must be installed on computer

Will need upgrades

Can change Web host or other service providers without changing storefront; need to ensure server is compatible with the suite

Storefront Software

Can be high development effort if implementing on your own without help from your Web host or ISP

Can choose look; more control over the layout and organization of store

Does not usually come with all components for complete shopping cart solution.

Scalable; few restrictions for enhancing or changing a store

Back-end work if not working with an ISP or Web host

Must be installed on computer

Will need upgrades

Can change Web host or other service providers without changing storefront; need to ensure server is compatible with the software

Template Services

Easy set-up since whole store is administered through the Web (no installation and configuring)

Lack of customization due to template-based administration

Little scalability

Adding extra features to your shopping cart when needed is not possible; need to wait for the next software upgrade

Little technical knowledge required

Do not require full control over merchandising and technical capabilities

No need to find a Web hosting company or ISP as the store is hosted on the template service provider’s site

If you leave you will have to re-build your site

E-mall

Can get started quickly; has tools in place

Little capacity for customization

Little scalability

Will not work with your own financial and inventory systems

Little technical knowledge required

Do not require full control over merchandising and technical capabilities

No need to find a Web hosting company or ISP as the store is hosted on the template service provider's site

If you leave you will have to re-build your site

Must deal with other mall tenants and the overall mall management

Build own Site

Complex set-up

May require work with different providers

High customization; gives you the exact solution you need

High scalability; can develop the solution you need to be unique

Much more involvement required, therefore software and advanced development skills may be needed

Maximum flexibility and control over your site

Ask Questions

Q: How does the shopping cart software provide order details?

There should be a way to ensure that confirmation is sent to customers once they make an order and that you are provided with a message that indicates when an order is made.

Q: How long has the provider been around and have they developed a solid customer base?

Be sure to go with a provider that has been around for a number of years and has developed a solid customer base. If it is at risk of shutting down, support and upgrades will not be available in future, and you may need to switch to a different shopping cart solution in the future, which means you will incur additional costs.

Q: Does the solution have a method by which to calculate taxes and shipping?

An important component of shopping cart solutions is their ability to calculate shipping, handling and tax costs automatically. Ensure you obtain a solution that can specify shipping charges for international shipments and also collect taxes from all regions, not just one.

Q: Does the solution offer more than one payment option?

Although the credit card is the most popular way to purchase online, there are many consumers who prefer to pay using alternative methods. In order to maximize your sales your site should be capable of accepting orders through various payments methods such as digital cash.

Q: What kind of security features does the solution provide?

Important to online success is security. Not only should the credit card information be encrypted as it passes from the customer site to the merchant site, but it should also be stored in a secure environment so unauthorized parties can not access it.

Q: Does the solution enable connection to legacy systems i.e. inventory system?

Although not absolutely necessary starting off, it is beneficial to consider connecting your shopping cart solution to your inventory system so you can keep track of the number of items in stock and prevent overselling your inventory.

Q: What administration functions does the solution provide?

An important administrative tool is being able to make changes to your site as needed, including adding new products or making changes to existing products online. The method used for accessing and administering the store is essential to consider. For instance, some packages require that changes be made offline and then uploaded to the server. Try to avoid this option. Alternatively, find a package that will allow your store to be updated online from any Internet connected PC.

Q: What kind of reporting tools does the solution provide?

To determine if you are meeting your site objectives and to help you make decisions about the effectiveness of your store's design and product offerings, it is important to ensure your solution includes reporting capabilities.

Q: Do you offer a trial period for your software?

Many storefront solutions offer merchants the ability to download software for a trial period. This is highly recommended before you purchase.

Q: What kind of support do you provide?

Evaluate the support given by the provider. Regardless of your technical skills, you should ensure there is a high level of customer service.

Q: Do you provide more than one shopping cart solution?

Be sure to go with a provider that offers more than one shopping cart solution to ensure you get the best one for your business.

Q: Does the shopping cart work well with all browsers?

Not all shopping carts work well with every type of browser, so it is important to consider this when selecting a solution.