Ecommerce Web Hosting Solutions

Updated July 14, 2008

Once you have decided to sell your products and/or services online, you will need an ecommerce web hosting solution (servers, software, and bandwidth) to enable your website to take payment from your customers.

To do this, you have three options to choose from. These options are based on the strategy that best meets your circumstances and your personal and business goals.

The three options are:

Develop your ecommerce web site (and web host) from off-the-shelf components
Pay a 3rd party company to manage and operate your ecommerce
Get an All-in-One Turnkey Solution that includes all the software and the Ecommerce Web Hosting

Each of these have pros and cons. However your decision will make your life easy or very complicated.

Before describing each of the above options, we will first outline the components of an ecommerce web hosting solution.

The components are:

Ecommerce Web Hosting (includes bandwidth, hard disk, and services below)
Domain Name (most companies now include this with ecommerce web hosting service)
Business/Company Website
Electronic Catalog (can also be part of or integrated with your website)
Shopping Cart or a Single Order Page
Checkout Page (where secure credit card is collected from your customer)
Payment Processing Service (or Payment Gateway Connection)
Manual Processing of telephone/fax orders (also called Virtual Terminal)
Customer/Order Management System (transaction database)
Reporting System (for sales/marketing/accounting/customer analysis)
Technical Support
Internet Merchant Account

Developing your ecommerce web site from off-the-shelf components

This is not an easy task. First you must identify each of the above mentioned components from a long list of products offered by even a longer list of companies and then evaluate each and then purchase or lease every component. Of course you have already established that the components will work together beforehand.

If you buy a shopping cart, you have to make sure that it is supported by your ecommerce web hosting company and the database that your shopping cart uses to store your product information is also compatible with one that the hosting company facilitates as part of your service.

You also have to be technical enough to install all the components and configure the servers and put everything together and make it all work. This is not for the faint hearted. It is indeed quite a cumbersome task.

We have advised many of our consulting clients to avoid this if at all possible, and many of those that decided to pursue this option anyways, soon found out that it is a very complicated, time consuming, and costly option.

Ask yourself the following questions:

How much time will I spend on getting all the pieces, configuring the servers, installing the components, and troubleshooting?

At the end will the pieces do what I had originally wanted to do?

Is the finished product scalable, versetile, and flexible to change for future growth or opportunities that may present themselves later?

What was the cost of my time?

What was the cost of delay due to increased time-to-market?

Are my competitors now ahead of me?

Does the time/cost devoted to this increases the competitiveness of my product or reduces it?

In our opinion, unless you have a very large and complex ecommerce requirement, you should avoid this option in any way you can. Be warned, you will spend a lot of time and money with no guarantee for end result.

Pay a 3rd party company to manage and operate your ecommerce

This is much easier than putting together off-the-shelf pieces and hoping for the best. It a fast implementation time and you will have to do very little. Just get the ecommerce web hosting service, add the 3rd party component (through integration or through an API module) and start selling your products and services online.

Well not so fast.

With 3rd party processing, you still have to get many of your components but your ecommerce web hosting company provides many of these and then you integrate with the 3rd party processor for your credit card payment processing, Internet merchant account facility, and merchant account management the.

Remember with 3rd party processing, you will not need to pay for Internet merchant account as this is part of the credit card processing service they provide. You only have to pay the 3rd party processor a percentage fee for all the services they provide. They do have a minimum and here we will anticipate that you can do the mimnum sales so that there are no additional fees.

So, you are now asking, what is the percentage of my sales/revenue they take?

Often you will pay a percentage of your online revenue in the range of 5%-20%, there are monthly fees, and additional fees from time to time.

There are companies that charge less but they get you in other ways.

Despite the convenience, the worse part of this ... is - Your customers are not your own.

That's right. Your customers that you worked so hard to get to build your business belong to the owner of the payment system merchant account (if you read the contract you will see the ownership rights).

Even if you can accept the high cost, often low features, and unflexible methods you will have to accept that you are not really the owner of the customers that you service.

Finally, many of these processor make your ecommerce website look cheap and unprofessional. Hopefully in the future they will improve their interface so that professional looking websites are not tarnished by cheap looking buy buttons added to your site.

Get an All-in-One Turnkey Solution that includes all the Software and the Ecommerce Web Hosting

We think that All-in-One Turnkey solutions are the best option for most companies that want to sell online easily and cost effectively.

First, this type of single-source solution includes everything you need to start selling online - the components are already integrated with your ecommerce web hosting service. There is no software installation, no server configuration, no SSL certificate inclusion, and no constance monitoring of all the software and servers. At most, you will have to do some account setup with amounts to setting up your business information, address, telephone, etc. and your product information (in most cases you can even import this into database provided with your account).

Second, you don't need to invest a lot of money (or waste a lot of time) upfront before you start selling online. Most ecommerce web hosting services that offer all-in-one solutions include everything for you as part of a monthly service fee. No one-time software costs.

It is also nice not have to do any server management. If you did, you would incur developing costs, and lots of time wasted for technical troubleshooting, that is if you are technical yourself - otherwise you have to recruit a technical person to work for you.

This option gives you the choice to select from a variety of implementations that fit the business model of your company, designed specifically for the type of products you sell.

But to succeed at this, you must find and choose a single-source company that develops, markets, and supports the entire solution. That's the key. And find one with good reputation for its products and its support services.

The solution is ideally in-house developed, can be supported and managed by technical staff who have have built it and continue to grow the feature-set, and you can have access to technical code (and the developers) when you need to discuss custom implementation (or any custom development) for your specific needs.

Since the componets are already integrated, tested, and proven with a sensible track record from a company that you can trust and rely on, your ecommerce is much further ahead than with any of the other options.

Any good sinlge-source solution provider offers ecommerce web site hosting that has all the components ready to use in a reliable datacenter with sensible bandwidth size and a large enough hard disk size. There are many companies that offer exactly this. So it will not be difficult to find one that matches all your needs and meet all your criteria.

It is important to point out here that ideally you want to find a single-source provider of an All-in-one solution and not a broker of other companies products and services. Because if you are having any technical problems, you want to have access to the developers not to a middleman who has to go to the developers and come back to you.

Good luck.

You can read more about single source solutions at Off-the-shelf Ecommerce Solution vs. the Single Source All-in-one Package. For a compiled list of ecommerce web hosting providers you can visit, Compare Hosting Companies and see the detailed review of each.