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Ecommerce Hosting – Picking Between A Hosted And Self-Hosted Solution

2015-06-19by Harry Trott

There has been a monumental shift towards ecommerce retail over the past decade. Between Mar 2005 and Mar 2015, ecommerce as a percentage of retail sales has grown from 2.40% to 7.00% according to reports from the US Census Bureau. This has presented traditional retailers with an opportunity and a challenge. While these retailers today face competition from digital counterparts that have far lower operational costs to deal with, the ecommerce channel by itself presents an opportunity to grow beyond your traditional customer-base.

 

These changing dynamics have forced retailers to open an online platform to complement their traditional marketing channels. But depending on how comfortable the business owner is with technology, this can either be an exciting or an intimidating experience. There are basically two ways to operate an ecommerce website – either use a managed or hosted solution, or handle a self-hosted application on your server. Which is the better deal? This short article will help you with the decision making process.

 

Self-Hosted Vs. Hosted Ecommerce

 

An ecommerce website is made of different components : a hosting server, an application that deals with managing inventory and orders, a payment gateway to process payments, shipping management, analytics and marketing tools (for SEO, advertising, etc.). There are leading applications that deal with each of these different components. You can of course pick and choose the best of tools that deal with each of these various functions. But as a retailer with limited tech expertise, this requires a lot of learning.

 

A good alternative to this is a hosted ecommerce solution. In this case, the retailer only needs to sign up to one platform which takes care of all the ecommerce management needs. For example, SuiteCommerce, the ecommerce service from NetSuite takes care of everything hosting inventory, managing payments, handling orders and web hosting. For small retailers, there are also services like Shopify and WooCommerce that one could look into.

 

What Should You Choose

 

Both these solutions come with their own list of pros and cons. Speaking in a general sense, managed ecommerce hosting works great when your business does not need any drastic customizations. While you have the liberty to pick a hosting configuration, payment method and design on all the major hosted ecommerce services, they may not be the right fit if you have certain specific requirements. For instance, if you operate in a country that does not accept leading payment gateways like Paypal or Authorize, then a managed ecommerce service may not good for you. Similarly, if you operate on a shoestring budget and cannot afford monthly payment plans, then a self-hosted solution that is based off open-source services is a better deal.

 

All said and done, as a retailer, your objective should be to get off the ground as early as possible. Managed hosting solutions enable this on most occasions. The best strategy could then be to kickstart your online channel using a hosted service and gradually migrating to a self-hosted solution if need be, in the future. 

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Harry Trott

A well known author covering a variaty of topics.

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