Estimated reading time: 12 Min
A few years ago, the ecommerce In Mexico it didn't exist, think about having your own online store was a reality only in countries with more developed economies. It was there that professionals like Alejandro Moreno began working to see what we have today: quite an explosion of ecommerce which every day allows thousands of brands and entrepreneurs to venture into this sales channel, which is currently in the buying preferences of millions of users.
Alejandro Moreno is passionate about electronic commerce, was one of the pioneers in Mexico, today he is a consultant and expert in Shopify at Getmore. Below, we share his interview conducted on our Al Cubbo Ecommerce channel, find the full podcast on Spotify.
Don't miss this article! We'll talk about the different sales channels, the transfer of demand from the Marketplace to the DTC, Shopify and others platforms for creating ecommerce, advantages, disadvantages and more.
What is the strangest thing that has happened to you in the world of ecommerce?
“Everything has happened to me. As a supplier, for example, we have received leads for the sale of clandestine weapons or very strange leads for the sale of fayuca. Currently, we have a customer in the United States who sells bows and air guns for entertainment purposes, nothing that hurts, but it's something that you don't see in Mexico, so the issue of weapons was very strange to us.”
For you, what is ecommerce?
“The ecommerce it's not an online store, it's not a website with a shopping cart, it's a business model for selling products and services, which has four fundamental pillars:
1. The product: how good a product you have in terms of quality, price and exclusivity.
2. The technology: what tools do you use and what benefits it offers you; this is where it comes in Shopify as one of the best platforms.
3. The logistic operation: efficient shipments, at a competitive price and that arrive as quickly as possible, this is where suppliers such as Cubbo.
4. Dissemination or digital marketing: how the product is publicized, through what channels, with what message and under what sales strategies”.
“It's very important that the four pillars are aligned and improving in a balanced way, because it's no use having a super marketing campaign that generates traffic to our ecommerce, if when visitors arrive the platform it falls down, payments aren't processed properly, shipments don't go out on time, or the product arrives badly.”
What sales channels can we find within this business model?
“There are different sales channels, however, the strongest are 3, their level of importance depends on each brand and the level of relevance it gives them:
· Marketplace: This is where Amazon, Mercado Libre, Linio, eBay, etc. come in, highly recognized channels where brands offer their products. These are attended by millions of people to make their purchases in different categories.
· Social networks: on Instagram or WhatsApp, for example, we find success stories of different brands that use these channels to encourage their sales, one of them is Net A Porter, an English company where 25% of their sales are made through WhatsApp.
· Online store: It is the Direct to Consumer or the website with the shopping cart, where brands offer their products directly to the final consumer and take up the issue of payment gateways, shipping, product promotion, inventory management, Customer service, etc.”.
Also read: Ecommerce: 10 Highly Effective Tactics to Increase Your Sales
“Which one to focus on will depend a lot on the type of product and industry to which you belong, for example, if I have a fairly popular product, with a higher volume, a good option would be the online store at Shopify, the Mercado Libre Marketplace, the WhatsApp and Facebook networks. If, on the other hand, it is an exclusive product, the alternatives in terms of Marketplace and networks can be other. Depending on the industry and sector, there are different channels that are better adapted to each need.”
“It's best to focus on the channel where you get the best results and where you have the most knowledge and access. If you already have experience selling on Marketplace, for example, deploying your efforts on this channel can be much more profitable than building your own online store, or the opposite; this is closely linked to the objectives that you want to achieve in the medium and long term and to business strategies”.
What do you think of transferring demand from the Marketplace to your own sales channel?
“The migration of demand from the Marketplace to the Direct To Consumer or towards social networks is a trend. Why? In the Marketplace you sell, but your customer is Amazon or Mercado Libre, not the end customer, for whom you don't have the data or feedback, and this, in the medium and long term, is a lack for the ecommerce”.
“One of the three main Metrics In the electronic commerce is the recurrence rate. It is estimated that, in the first two orders placed by each customer, money is lost, and after the third purchase, a profit begins to be generated. Based on this, it is important to look for ways in which the customer's lifetime value can be increased over time, and this is where we require data to deploy different retention strategies, which shows why, more and more companies are migrating their Marketplace demand to the DTC”.
There are many platforms on the market to build an ecommerce, which one do you recommend?
“There are a lot of options, to name a few, we have Shopify, Vtex, Magento, Woocommerce, Tiendanube, among others, your choice depends on several factors such as the type of seller, whether entrepreneurs, small, medium or large companies, let's see why”.
“Entrepreneurs and small businesses hardly have an administration system, an ERP for managing accounting, inventories, payroll, or a technical team for platform administration, unlike medium and large companies, this is the first point to consider.”
“When talking about ecommerce platforms, on the one hand, we have the famous SAS like Shopify, where you purchase a license and continue to pay for the infrastructure and technological maintenance of the store, on the other hand, there are the open source platforms such as Magento, which are more flexible, but create dependence on a technical team”.
“On the basis of the above, the recommendation for SMEs is undoubtedly Shopify, because you don't need to have a technical team that is maintaining the platform, your design or marketing areas can upload products, add discount codes, view metrics and statistics in real time. In addition, if on a Buen Fin or on a Black Friday the store becomes saturated or is slow, Shopify is responsible for solving such incidents”.
“On the side of medium and large companies, what is probably best for them is a platform like Magento, because they have to connect with N number of warehouses, with their accounting system and with many more systems, which requires a much more open technological stack; it doesn't mean that Shopify I can't do it, however, many of the old ERPs are not aware of PPE, nor of the type of information consumption that can be done through Shopify, which is very simple.”
“In addition to the above, the age of companies also influences, we have big brands with only a few years of creation that sell millions of dollars a week and all their technological infrastructure is built on Shopify, they don't need more, generally speaking, companies with more experience have older and inflexible systems”.
When is it convenient to have an in-house technology team and when is it not?
“When the technological team adds value to your product or service, it makes sense to have it in-house and make it one of the verticals of your business, of your core business, when this is not the case, this resource is not required. We are very transparent, when we receive prospects with which Shopify it's not going to be a tailor-made solution, we directed them to some other option such as Vtex or Magento, it's a reality, not everything applies to everyone”.
27% of ecommerce worldwide are with Woocommerce and 20% with Shopify, which will predominate in the future?
“In a very short time it will predominate Shopify. This company was founded in 2006 and took 13 years to reach one million stores, however, from 2019 to the end of 2020, it reached two million stores, in a year and a half it achieved what had taken 13 years; this speaks of the accelerated growth that the company is experiencing, which will soon tip the balance. We as implementers and Shopify experts, we are making more and more migrations from Woocommerce to Shopify”.
“The truth is that there is no point of comparison. What do you need with Woocommerce to have an online store? You need to select a good server: Amazon Web Service, GoDaddy, Google Cloud, etc., you need to choose the right certificates and security protocols, you need to build integrations with other systems, etc.”
“Now, if we are talking about an entrepreneur who does not have technical knowledge, he will have to delegate such decisions to a programmer or to an agency outside his business, to make those decisions for him, which may later require changes or new developments, aspects that he should not worry about, since his only role must be to sell.”
“With Shopify, customers don't have to worry about anything technologically. We don't develop software, we have a very solid front-end development team; we don't build irons, we use them. We can do any type of design, but if the customer needs, for example, to make a subscription model, we look for which of the players are the best for this development, who have direct integration and we make it a reality”.
“An added value that has Shopify The thing is that behind the platform there is an App Store, which opens up a window of possibilities with more than 8,000 applications, which allow us to do business verticals without having to code absolutely anything. For example, there is an application that we really like, that generates intelligent searches, predictive searches within the ecommerce, then, if you have hundreds or thousands of SKUs, as you type words, the search engine returns potential results, it also has an advanced filtering system and is self-managing; to install it, place or remove filters and edit, you don't need a programmer”.
“With Shopify you have agility, zero dependence on a technical team and speed of execution, which becomes a competitive advantage in a field as dynamic as electronic commerce”.
How does the Getmore-Shopify alliance work?
“When talking about Shopify and Getmore, we really like the mall analogy. Imagine that you sell shirts, go to a shopping mall and rent a place, you make a contract with the tenant, where you pay him a monthly rent in exchange for security and security, besides, you don't have to worry if the foundations are well done or if the electric ladders work, that's not your responsibility, your duty is to make the place very beautiful, create a good experience for customers to enter, attract their attention and buy”.
“Following this analogy, Shopify It's the mall, and the place is a space on the server that you've already rented. When you open, you have two options: you prepare the premises on your own, or you hire an architectural firm, the latter being Getmore, who, based on their experience and knowledge, advises you and gives you the best options to get the most out of your place”.
Do you have any anecdote that happened to you for dates like the Buen Fin?
“Yes, in 2020 a prospectus arrived with us, this customer had two options: PrestaShop vs. Shopify, didn't choose Shopify for the cost of sales commission, which at that time was 1%. For him, in his financial model, it was an interesting amount, so he went with PrestaShop.”
“During the Buen Fin he talks to me and says: “My store is down, it's the weekend, the programmer doesn't answer me and I'm losing sales! What can I do?” The programmer never answered him and he missed the whole Buen Fin. So, it's the opportunity cost, I wish I had paid that 1%. Nowadays it is in Shopify, we did the migration and he is very happy.”
“At Getmore, as an agency, we are super calm, no matter if it's Buen Fin, Black Friday or any other date, the ecommerce It's not going to fall, which is very important for the loyalty of our customers' buyers, because if a user has a bad shopping experience, their chance of recurrence is very low.”
When it comes to costs, how does Shopify compare to other platforms?
“Shopify is the most economical. When considering the costs of one or the other platform, it is necessary to consider two scenarios: one, the lost sale, that is, what you lose due to payment processing failures or server crashes during a peak sale, and two, the cost of maintenance, if each system failure or change in the site requires that the ecommerce Hire the services of a programmer, how much will each thing cost? Or if you have an in-house technical team, how much does each payroll cost?”
“With Shopify you don't have these associated costs and they charge you commission only for what you sell, it's variable, which makes it a platform much more economical. It is very important not to make the mistake of omitting these scenarios in the financial model when making a decision. We are sure and very calm that the value we offer to our customers is the best that exists to meet their needs.”
“At the technology level, Shopify It's the best thing there is. At the company level, it's a beauty, the people who work here are always willing to help.”
What are the most important aspects to start selling online?
“One of the most important things is to build community. Many entrepreneurs start by opening the ecommerce and then their social media accounts to publish, disseminate and attract traffic; it doesn't necessarily have to be that way, several of the best clients we have started with communities on social networks and when it became a need, they opened their online stores for an issue of scalability and growth”.
“One of the biggest mistakes that arise is wanting to do everything at the same time, not knowing that the Growth of e-commerce it's a lot slower when you don't have a community yet. My recommendation is to start building it on Facebook or Instagram, or both, without immediately needing the Building an ecommerce”.
Also read: From 0 to Ecommerce, everything you need to know to create your online store
What are those top practices that contribute to generating a high impact on ecommerce?
· “First. Have your store in Shopify, you won't have to worry about the operation of the platform.
· Second. Have WhatsApp for Business integrated into your store Shopify, so you can respond as quickly as possible to your customers. We have seen online stores where 80 or 90% of their first purchases first go through a WhatsApp message with the sales team.
· Tres. Keep in constant communication with all your customers.”
3 things that will happen in the future?
1. “To have no technical dependence on a team, thanks to the use of different tools.
2. There are going to be a lot more and more automations in the ecommerce with different technologies.
3. In the future, we will have 100% confidence in the electronic commerce. Between 2019, 2020 and 2021 alone, this factor has increased significantly.”
Are you seeing challenges in ecommerce?
“A matter of competition. Every day it is becoming easier to start a business and start a business; there are many people manufacturing the same shirt, the same shoes, buying from the same supplier. This is where the topic of specialization becomes important, the more niche your product is, the greater the probability of sales and growth.”
Also read: 4 challenges for the adoption of e-commerce in LATAM
“If you're a generalist and you sell cosmetics, people will first look at Amazon, Liverpool, Walmart, the big Marketplaces, but if you sell differential products, for example, cosmetics for places with hot weather that don't fall off with sweat, you'll differentiate yourself and have a better chance of being bought”
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