Starting an eCommerce business in Nigeria doesn’t have to be hard, as I’ll be sharing a step process to help you get started with E-commerce.
What is Ecommerce?
It is a business model that that selling to the online world with the power of the internet. The internet has given us the luxury to sell to anyone we choose through the eCommerce business model.
Ecommerce is a widely growing industry and an insanely profitable one, eCommerce purchases have gone up like crazy and people now prefer shopping online on sites like Amazon and eBay. Though profitable, this business model can be a little tricky to get started with and most entrepreneurs go broke after investing in this business model.
So what steps are necessary for success in the eCommerce industry.
What goes into starting an eCommerce business in Nigeria
1. Market Research
Don’t be that businessman that invests all his money into an inventory he knows almost nothing about and struggles later on to sell even a penny.
Market research is extremely essential when starting an eCommerce business in Nigeria. There are several profitable markets available to entrepreneurs in Nigeria some of which include:
- Beauty
- Fashion
- Babycare
- Electronics and gadgets
With e-commerce, you’re going to need to invest your money upfront to cover the cost of Branding, marketing, and inventory. Nevertheless, All of these costs are paid off in profits when it’s a valid and viable market you broke into.
List and Analyze all the potential markets you might be considering based on :
- Demand:
You should focus only on Niches with relatively high demand so you know you’re in a viable market that actually has customers.
- Competition:
When choosing a market to go all in on, you need to analyze the competition rate. Ideally, you want to focus only on markets with low competition. I mean it’s only logically the fewer people you have selling in your market, the more customers you’ll have for yourself.
Take competition analysis with a grain of salt, because on the other hand, the higher the competition in your industry, the more likely it is that your market is a truly profitable one, and with a crazy marketing plan, you can definitely turn a profit in a competitive market.
- Product opportunity:
Choose niches that have a wide range of products to select from and build a brand around, this alone reduces your competition even further as you don’t have to compete with already existing brands selling the same product.
Once you’ve completed your market research, move on to the next phase of your startup. Watch this video, to learn exactly how to conduct market research for your business.
2. Choose your business model
Don’t be deceived, E-commerce is a huge industry with submodels to its name. It has multiple delivery methods and they all come with various pros and cons.
Ecommerce Sub Business Models Include:
All of these different models will require different tools and resources to get started
- The Basic Model
This is the most common eCommerce model, especially across Nigeria, you simply get the products you want to sell, create an online store, get traffic to your store, track online orders and manage shipping/delivery.
As regards where the products will be from, you could choose to private label a product from wholesalers, try retail arbitrage or make your products yourself. This is a really tedious business model but truly profitable.
If you’re looking to become the typical C.E.O, we all see in movies, this is the business model you should definitely consider trying out. To make this business scalable, you’ll need a team to manage inventory and delivery while you handle the administrative parts of your business.
- Print On Demand
- Dropshipping
3. Choose your products
Once you’ve made the choice for the business model you want your e-commerce brand to run on, it’s time to find products to sell. This should be really easy to do, as there are millions of products available in different markets.
Take the beauty niche, for instance, you could choose to sell hair and wigs, skin care products, beauty gadgets e.t.c. Product research is really critical for the success of your e-commerce brand.
Market research was mainly to ascertain the profitability of the niche in general. Product research is to decide whether or not a product is worth the time, a blue ocean or a red one.
To do this, list all the products you could potentially sell in your niche, then start your analysis.
- Make sure your product solves a problem in your industry and is not just for luxury and fun. This way people have no other choice than to buy from you.
- Check out how many brands in your industry currently market these products. The lower the better.
- Scout for new and trendy products. Sure evergreen products are the best for sustainable revenue, trendy products are awesome for huge income margins as it’s something your market is wowed by and has barely ever seen.
4. Your Business Plan
As I’d always out, no business is proper without a business plan. If this is going to scale to multiple 6-Figures or more, it needs to have a plan.
- What specific business goals do you have? where do you see your e-commerce business years from now?
- What is your unique selling proposition?
- What are your business strengths and weaknesses?
These are some of the questions that should be answered in your business plan. It should also state how you plan to manage your financial records and inventory to avoid running on losses.
Watch this video to learn how to create the perfect business plan.
5. Your Marketing Plan
If you ever come across even one successful business that runs without a proper marketing structure, I’d be the first to be shocked.
Forget digital marketing, even that successful restaurant near your house understand the basics of marketing. You need to make constant efforts to ensure that word about your business gets to your dream customers.
For those “Mama put” stores, their marketing strategy was basic but effective.
- The perfect location ( For brand awareness)
You could have the best product and still get no sales. People won’t ever buy from you if they don’t even know you exist. As a matter of fact, marketing studies show that people have to hear about your brand 7+ times before they make the decision to buy.
Mama Taye understood this, and chose the best location in town, with a lot of passersby. This way on a passive level, people have it stored in their subconscious that a food seller exists in their vicinity.
- A great product and Customer service
No, let’s talk about another food seller somewhere else, she stays in the perfect location but gets almost no customers. Instead, people pass by and choose to go to mama Taye’s stand instead.
Her food lacks quality and her sales girl is almost shouting at customers. You can get people to find your brand, but you might never get them to buy because of these two factors. You need a great product that hooks people in and insane customer service that gets them spreading the news about your brand.
Whether you choose to accept this, people will always have something to say about your brand, you just have to minimize the negatives. Thankfully, your product quality and customer service do this for you. Make sure you have low chances of refunds and treat your customers like kings and soon you’ll be enjoying the power of Word of Mouth Marketing.
Word of Mouth/ Referral Marketing is just one way to market your business. Trust me, the magic happens online, if you can harness the power of digital marketing, your business can see crazy growth in no time.
Digital Marketing is truly a mouthful, but for a start, here are some helpful resources to get started.
- 21 Online Marketing Platforms to try out in Nigeria
- Our Free Digital Marketing Beginner’s Class
- How to market your business online In Nigeria
6. Build your E-commerce business
At this point, you should have everything you need to profitably launch your e-commerce business except the business itself. Up until we had this whole idea on paper, it was now time to actualize it.
Here’s what you need to build your E-commerce business
- Your online store
This showcases your brand and all of its products. It’s the heart of your e-commerce business since, without it, there’ll be no place for people to buy with your brand
There are many eCommerce platforms available for entrepreneurs to build online stores but if you’re Nigerian and are looking for the cheapest yet good quality option available, follow these steps. We’ll be making use of WordPress and a free Plugin called woocommerce.
- Create a WordPress website: Read this complete step-by-step guide to learn how you can create a WordPress website of your own for just N800 per month.
- Install the Woocommerce plugin on your WordPress site and start designing your e-commerce website.
Asides from WordPress, there are several other online store builders perfect for Nigerians and they are all free to use. Watch this video to discover 3 Free website builders that allow you to create an e-commerce website in Nigeria.
- Get your brand identity in one piece
You don’t want to launch an eCommerce business that looks like it was created in the backyard of an 8-year-old. It needs to be professional and branding helps you ensure that.
- You want your logo to be top-notch to an extent.
- You need a cohesive color palette to maintain brand consistency
- You need graphics assets to market your brand professionally. E.g business cards, product labels e.t.c
7. Launch your E-commerce business
Now you have anything in place, it’s time to launch and start marketing your business to the world. Remember to contact us to help you with marketing your growing business, if need be.