When most folk hear e-commerce, they mostly think about selling of goods like a regular shop, but online. Most times they even wonder, is e-commerce profitable? If you’re one of these people, then this post is an answer to your burning questions.
In this post we are not only going to tell you just how profitable e-commerce really is, we are also going to show you how to get started and profit in the Nigerian market.
What is e-commerce?
With so many models and modifications out there, it’s easy to loose the meaning. But e-commerce in general simply means the selling and buying of products online without the need of a physical meeting point.
Simply put, anytime you sell or buy something online, you are participating in electronic commerce, or e-commerce for short.
There are lots of variations of this e-commerce model, including dropshiping, Fulfilment by Amazon, white labeling and so on. In the African market, with special emphasis on Nigeria, there are basically two types that are very common.
The first is self hosted e-commerce by big house hold names like Konga, Jumia, Alibaba and the likes. Here these big names imports and hosts the products as well as sell them and cover payments on the platform. A single platform does the hosting, advertising sales and delivery all by one single company.
The second model is done by e-commerce vendors and this is the one you will be interested in as a newbie. Here you search for her to get products and store them for the time being while advertising using a different platform and delivering your products to buyers with a pay-on-delivery system.
See more here.
How do I start e-commerce business in Nigeria?
So let’s get into the basics of e-commerce and how you can get started.
1. Research
The very first step is to make adequate research. One of the reasons why a lot of businesses fail is due to inadequate massage or using secondhand information. Some business owners simply ask other people who have no first-hand experience in a particular industry for advice and run with it. You absolutely should not do this.
Instead you should carry out adequate research to find out what e-commerce model best suits your region. You should also figure out how present e-commerce businesses which are operating are able to carry out operations with minimal hindrances.
You should also figure out what niche/ industry you wants to go into because you cannot focus on more than one niche at a time when you are just starting out that will simply lead to massive failure and waste of funds. Then figure out how to source your products and get them cheaper as well as get them delivered to you. Also you have to consider where to store them to avoid damage.
Lastly you need to figure out what advertising platform to use for example, some products are better advertised using Google, while some regions are better assessed by Facebook than Google. For some products such as adult toys, you would make a better return on investment advertising on adult websites.
That said you must also make research on how to advertise effectively so as to spend the lowest amount and get as high as possible conversions, how to get your products delivered to your customers effectively as over 35% of customers will simply cancel an order if they are delivery problems.
After researching and determining all these it’s time to go into the next step.
2. Set up your E-commerce business Funnel
Okay you’ve made your research and now it’s time to go practical. The very first thing to do is to get your products delivered to you. From the research you have made you can simply reach out through your supplier and have them delivered the products to you.
While your products are been delivered the next step is to contact an advertising agency to set up your Facebook account your Shopify store or your website. Setting up your website on Shopify store requires some basic knowledge in web design. This is something you could also do by yourself if you get this course.
While these are going on you should also get in touch with your delivery agent and set up an agreement. You should ensure that your delivery agent covers all the regions you want and gives a flat price so you have the liberty of including a delivery free or giving an offer such as free delivery.
It’s also important you have basic knowledge about how your Funnel works. Your funnel is a process customer steaks from seeing your advert to making a purchase and getting their products delivered. Having basic knowledge about your phone now will help you know when there are problems with your business and what part needs some fixing.
3. Getting customers
Now that you have set up your account for now it’s time to get customers to see your products and if all goes well make purchases.
With the right creatives and sales funnel your ads is start producing orders within 48 hours, during this period you should not touch or make adjustments to your heart especially when using platforms like Facebook and Google. This is because the algorithms take time to learn who are the best customers for your business.
If after 48 hours however you are yet to make orders in sufficient quantity then it’s time to pause your ads and look into your Funnel to figure out where the problem is coming from.
Here are three cases in which you should post your ADS and make some edits.
1. You are getting very few website visits – often times when this happens, you will be getting very high cost per click and very little engagement on your ads. This simply means your ad copies underperforming and not engaging the right people or your target audience was wrong.
In this case what you should simply do is ensure you have the right target audience and change the creatives you are using.
However when you get this course you will limit your chances of wasting money on a bad creative and using templates that actually work check it out here ( I get a commission when you buy a product).
2. You have lots of website visits but very few orders – Great, this means your creatives are doing very well and you did a good job at your audience targeting however your sales copy sucks.
Your sales copy isn’t convincing enough for people to remove money from their pockets and make a payment. It could be that you are not painting the right picture for them or your offer isn’t tempting enough. If that is the case you can seek help from a professional copywriter.
3. Lastly, orders are being made but lots of people don’t complete payment –
If you’re using the pay-on-delivery system as it’s more commonly used in Africa for newbie E-commerce Business, then the problem will most likely lie in your delivery time.
The shorter your delivery time the less probability of potential buyers changing their minds. Your aim at this point should be to shorten your delivery time to under 48 hours.
How much can you make from e-commerce
Now that you have understood the basics of setting up an e-commerce business in Nigeria and your e-commerce business is set to run here is an idea of how much can be made from e-commerce.
Everyday people buy things online and that is only increasing. According to the International Trade Association $12 billion is currently spent in the e-commerce industry as of 2021 and that figure is projected to increase to $75 billion by 2025.
So again how much can you make from e-commerce? Well a portion of $12 billion isn’t bad right? All you really need is a kickass product and a working sales funnel and you’re definitely in a business that will keep you smiling to the bank.
Of course there are pitfalls you must avoid and it takes some learning, so that’s why I recommend this course by Jonathan Melody, Nigeria’s number 1 E-commerce mogul. You’ll definitely learn some hidden secrets to the game.
Want to learn about the Best e-commerce platforms in Nigeria for 2022? Check here
Looking for the best e-commerce product niches for 2022. We got you covered. Check here.