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The e-commerce industry is a billion-dollar industry growing at the rate of 8-12% annually. A number of small businesses and entrepreneurs are tapping into the vast opportunities of e-stores. For those who really want to hit the mark, they need a website that can scale to high traffic, security of customer data, automatic backup, a reliable payment gateway and shopping cart.
These qualities are directly affected by the type of web hosting an e-commerce store relies on. Hosting services are available for small businesses running on a tight budget. However, the cheap hosting plan should not be an option for an e-commerce store. Price shouldn’t substitute for superior quality that a top hosting company can provide.
What is e-commerce hosting?
This is a hosting model where a hosting company provides online stores with an electronic commerce website. It is different from standard web hosting because it requires special functionalities and features to run and manage an e-commerce website.
E-commerce hosting is designed to provide small businesses with the tools they need to set up and conduct an online store. Apart from the e-commerce functionality, web host providers also offer a web server to host the site, email server and technical support, same as any standard web hosting.
Features provided by the hosting company include
For e-commerce stores that accept credit cards, the web host company must be PCI compliant. Do not think this is something you can put off in the future. PCI applies to all merchants regardless of size or transactions. This means it also applies to e-commerce startups.
Secure sockets layer certificates
SSL certificates allow e-commerce sites to add an extra layer of protection that encrypts the customers’ data and information. Your hosting provider should provide this function.
Scalability and flexibility
The e-commerce industry continues to experience rapid changes. As a growing company, your host provider should be able to meet your present and future needs by easing cancelling or adding extra services. They should also make it convenient to use additional services.
Backups can be either automated or manual. The automated backup is best because it is a comprehensive option that provides regular backups. It will be offered by your hosting provider under a managed plan.
The thought of downtime is enough to give the webmaster nightmares for weeks. For every minute your website is down, you’re losing out on potential sales which could increase the bottom line of your small business.
It might not seem revolutionary but a firewall is essential for e-commerce website security. It protects you against automated DoS attacks that prevent your customers from accessing your online store.
The importance of security and reliability in e-commerce hosting
Hosting contributes to the efficiency of your business. Online e-commerce stores need a web host that provides a shopping cart for consumers to hold their orders until they are ready to check out. It encourages shoppers to spend more money on your website.
Managing your online business is tasking in itself. A high-quality hosting package from a reliable host makes it easier. Your hosting provider can help you choose a cost-effective package that focuses on uptime and data protection.
Brendan Wilde of https://www.openhost.co.nz puts it succinctly when he said “Data security is not an option for e-commerce stores. It is critical to both online shoppers and business owners.” As online shopping increases, so do malware, identity theft and hacking attempts.
Small business owners are tasked with the responsibility of protecting sensitive information provided by their customers such as addresses, passwords and card numbers. You will likely lose all your customers and your business if your e-commerce store is hacked and customers lose their money.
The questions your e-commerce hosting company should sufficiently answer include
Do they offer SSL service?
Will you receive an email when an order is placed and when it is successfully completed?
Is there a limit on the number of categories and products you can put up?
What is the bandwidth and storage allowance?
Is there a setup and monthly fee?
What payment options does the shopping cart accept?
Shared hosting won’t cut it for e-commerce startups
Shared hosting allows multiple websites to share resources on a single server. Each customer has a limit on the amount of server resources he can use, as defined by the hosting company. It is a cost-effective option for websites that are just getting started online but it comes with many limitations.
Many hosting providers claim to offer unlimited resources on shared servers. They promise you the stars just to sign up. Sadly, you will find that it’s all smoke when you read the fine print. Hosting providers do not offer “unlimited” bandwidth, disk space or CPU usage on a shared server.
Some offer an SSL certificate on a hosting plan. The problem with this is that it won’t match your domain name, which raises questions for your customers on the security and authenticity of your online store.
On a shared server, performance is sacrificed for cheap hosting. When customers visit your online store, they expect everything to work efficiently. This includes high page load speed. When it takes 6-10 seconds to load your e-commerce website, you’ll notice higher bounce rates and lower conversion.
Research on the effect of page speed on sales shows that customers won’t wait longer than 3 seconds for your site to load. Shared hosting providers only make money when they jam as many websites as possible on a single server. You won’t enjoy software updates and patches like a managed VPS or dedicated hosting plan.
If you’re paying $5 a month for a shared server and losing $1,000 in potential sales, that’s not good for business. You could be making ten times that amount by paying $40-$50 for a better hosting environment.
VPS hosting as a cost-effective solution for e-commerce startups
Virtual Private Server is a physical server housed in a data centre. The servers are divided into multiple VPS, shared or dedicated servers. Think of it as a shared server with the benefits of a dedicated hosting plan. You can also customise it to fit your website hosting needs.
As an e-commerce startup, you’ll be happy to learn that a VPS is less expensive than a dedicated server. You only pay for what you need and scale as your hosting need grows.
VPS is the answer from hosting companies looking to address the limitations of shared hosting. The single server is split between users in a pseudo-single environment, ensuring each user has privacy and full control of its server resources.
In the past few years, maintenance costs for VPS have dropped, making it more affordable for e-commerce startups with a shoe-string budget.
E-commerce startups need more resources than a shared server can provide. You will struggle to run the scripts your store needs to handle high traffic and purchase queries due to meagre server memory.
How does VPN benefit e-commerce startups?
Guaranteed memory space
The predicament of insufficient disk space and bandwidth is not an issue in a VPS server. You agree with your hosting provider on the amount of disk space, bandwidth, CPU and other resources you need and it will be allocated to you.
You are guaranteed maximum speed irrespective of what anyone else is doing on your server. Since you have reserved CPU(s), it will be allocated for your operations. The amount of RAM you paid for is also available. This is different from a shared hosting environment where resources are shared based on the amount of traffic other websites are using at a specific time of the day.
VPS does not suffer from the hiccups associated with shared servers. The sophistication of the virtualisation software ensures that resources are efficiently allocated based on the needs of your e-commerce store.
Sometimes, you might need complete root access to install custom software for your e-commerce store. The pieces of software you can install on a shared server are limited. Websites on a VPS can leverage this feature to increase the functionality of their sites.
Cloud hosting as an alternative to VPS hosting
Cloud hosting is a cluster of individual servers working together as a single giant server. As your hosting needs grow, you can add more resources to a larger cloud. The PAYG (Pay As You Go) model makes cloud hosting an attractive option for e-commerce startups.
The managed cloud hosting plan is ideal for webmasters who are not tech savvy. Here, a dedicated server is leased to an ecommerce startup by a cloud hosting provider. It is the best way to optimise your store performance. Research shows that 79% of online customers won’t return if they are disappointed with their online shopping experience.
With cloud computing, you can host multiple ecommerce applications on a single server. It maximises page load speed, which translates into higher sales and conversions for your online store.
Other benefits include
Bigger savings and lower overhead costs because you only pay for what you consume
High-end data encryption technology and faster page load speed increase shoppers’ confidence
The flexibility and scalability to upscale or downscale your hosting need when required
Competitive advantage over similar businesses who have not adopted cloud technology
Both VPS and cloud computing are ideal hosting plans for e-commerce startups looking to grow their business and increase ROI. However, a VPS is more cost effective while cloud computing offers more flexibility and scalability. The option you choose should be driven by your budget, IT needs and functionalities required to run your online store without issues.