The E-commerce Blueprint (IV) – Prepare to Launch image

The E-commerce Blueprint (IV) – Prepare to Launch

Jossy C.
Jossy C.


This is the fourth (4) stage of setting up your e-commerce store, where you thoroughly learn and understand how you will operate and adopt a pricing strategy.

This section is subdivided into four (4) sub-topics

  • Shipping
  • Drop-shipping
  • The job of an e-commerce manager
  • Pricing strategies


     1.  Shipping:


Having a working shipping strategy can mean the difference between having a customer purchase your product or abandoning their shopping cart. Shipping strategies can also be utilized as marketing tools. This strategy begins on your website and it’s the first step of an eCommerce transaction. Your order fulfillment policies and information should be front and center on your website to attract the most attention.

At Tradift we have a shipping integration system with Sendbox.

With Sendbox, retailers on Tradift would be able to ship their products from the comfort of their homes, in a fast and secure way.



     2.  Dropshipping:


What is dropshipping?

Dropshipping is a retail fulfillment method where a store doesn’t keep the products it sells in stock. Instead, when a store sells a product using the dropshipping model, it purchases the item from a third party and has it shipped directly to the customer. As a result, the seller doesn’t have to handle the product directly.


Dropshipping is an increasingly popular business model among entrepreneurs because it has substantially lower upfront investment costs and is generally a lower risk alternative to more traditional eCommerce business models that require you to find suppliers and stock inventory yourself.


It works like this: you find suppliers of products you'd like to sell on an eCommerce marketplace, and then you import those items into your store. When a customer purchases one of those items, you then place the order with a supplier, and they ship the item directly to the customer. This way you never have to handle merchandise and can swap out products to stay on top of current trends with greater ease.


      Advantages of dropshipping

  • Low startup cost
  • Low cost of inventory
  • Experiment with new products with little or no risk


         Disadvantages of dropshipping

  • Little profit from sales
  • Total reliance on other people stocks
  • Less control over order fulfillment


     3.  The job of an E-commerce manager:


It is paramount to have a full understanding of what is expected of you as an e-commerce manager. Having good knowledge of the business of e-commerce will help you make good decisions and also aid the overall growth of your business.


As an eCommerce manager, you have the role and responsibility of looking after a website that focuses on the buying, trading, and selling of products and services to the public or for business purposes.

Some important duties of an eCommerce manager include


  • Optimization of sales and increase conversion rates
  • Overseeing the development of marketing literature and advertising
  • Regular site update with new product
  • Design various strategies to increase sales and monitor all performance reports every week and manage all new product launch calendar.
  • Budgeting and planning – you are entrusted with the administration of incoming payments and returns and analyze the sales statistics to optimize the product range and to be able to place targeted advertising.
  • Develop pricing strategies for the e-commerce store
  • Plan promotional campaigns such as contests or giveaways
  • Maintain an optimal level of customer services at all times and ensure simplicity in services and ensure compliance with all legal requirements and monitor all online channels.


     4.  Pricing Strategies:


What is a price?

Price is the value that is put to a product or service and is the result of a complex set of calculations, research and understanding, and risk-taking ability.

Creating a pricing strategy for your eCommerce business is essential, but it certainly isn't simple.

It takes time to land on the “right” price for your products. That’s true regardless of how much experience you have as an entrepreneur.

But, when it’s your first time launching an online business, coming up with a pricing strategy is especially tricky.

Running an online business without a pricing strategy is like running a race without a track. You need to have a pricing strategy in place when you’re running an online business so you can make sure that you don’t price your products too high, or worse, too low.

A pricing strategy takes into account segments, ability to pay, market conditions, competitor actions, trade margins, and input costs, amongst others. It is targeted at the defined customers and against competitors.


Here, we are going to discuss four (4) pricing strategies


  • Cost-based pricing:

This is the simplest form of pricing. Cost-based pricing is essentially coming up with a price for your products by adding the cost of your products (including shipping costs) and the margin that you want to make from each product.

The crucial task is coming up with the right profit margin that will maximize the profits without scaring off the customers.


There are 2 risks that come with this approach.

  • Pricing too cheap which will undervalue your products
  • Pricing too expensive and losing competitiveness

Finding the mean between these two extremes is very important in getting an ideal price for your goods.


  • Market-based pricing:

You'll need to analyze other brands who are selling products similar to yours and note down the prices that they have set for their products.

Pursuing a competitive pricing strategy doesn’t mean undercutting your competitors and lowering your prices until your margins are paper-thin. It carries the risk of racing to the bottom which is beneficial to no one.

Once you’ve got a good idea of what the average price is for the products in your niche, compare it against the cost that it takes you to make a sale, and the difference between those two figures is your wiggle room.


  • Penetration pricing: 

Price is set artificially low to gain market share quickly. This is done when a new product is being launched. It is understood that prices will be raised once the promotion period is over and market share objectives are achieved. Example: Mobile phone rates in India; housing loans, etc.



  • Skimming strategy:

In its simplest terms, e-commerce price skimming is the art of setting high prices for your products during an introductory phase. What this means is that businesses are able to leverage the “newness” of their product and maximize their profits from the get-go.

A high price is charged for a product till competitors allow after which prices can be dropped.

What you need to remember about price skimming is there are consumers out there who want to be the first ones to get hold of a product. They like the feeling of exclusivity.



Create your beautiful online store today.