Every day, millions of internet users shop for retail goods online, where they may be swayed by pithy product descriptions, alluring photos, engaging online videos, and customer reviews. Behind this front-facing web content is an ecommerce infrastructure made up of a vast network of hardware and software components.
Here’s what you need to know to set up your own ecommerce infrastructure, from its individual elements to its role in online sales success.
What is ecommerce infrastructure?
Ecommerce infrastructure is the underlying framework and technology that allows an online business to operate and conduct transactions over the internet. Whether online shoppers realize it or not, nearly all their activity on an ecommerce platform relies on the platform’s underlying infrastructure.
Elements of ecommerce infrastructure
- Inventory management tools
- Shopping cart
- Payment gateway
- Security tools and protocols
- Order processing
- Customer relationship management (CRM)
- Web analytics and reporting
- Scalability and performance optimization
Ecommerce websites rely on interconnected components to power their business operations. Here are the infrastructure elements that empower ecommerce businesses to serve their customers:
The front-facing piece of ecommerce infrastructure is an online storefront where products or services are displayed and transactions occur. Components of an ecommerce website include the user interface (UI) design, navigation, and functionality, as well as a content management system to keep the site organized and up to date. The site also needs web servers upon which your online store will run.
For example, imagine a customer visits an ecommerce site to purchase a pair of shoes. The website’s user interface (UI) allows them to browse various products, select the desired shoes, choose size and color, and add them to the shopping cart.
Inventory management tools
Inventory management software oversees product stock, ensuring accurate availability information. Such software can prevent both stockouts (where items listed online aren’t actually available for purchase) and dead stock (where warehouses pile up with unsellable inventory).
A good inventory management tool can be the reason a customer is able to buy shoes in their size and color.
Ecommerce platforms use virtual shopping carts, allowing customers to add, review, and manage items they intend to purchase before checking out.
Building off the previous example, the customer places their selected shoes in the virtual shopping cart and proceeds to checkout. The shopping cart functionality calculates the total price of the transaction, including taxes and shipping fees.
A payment gateway is web technology that facilitates online transactions by encrypting and securely transmitting sensitive information.
When the customer is ready to purchase the shoes they’ve selected, they head to checkout and choose a payment method. The ecommerce platform uses a payment gateway to securely process the payment. The payment gateway encrypts the payment details and communicates with the bank or payment processor to authorize and complete the transaction.
Security tools and protocols
These help an ecommerce business ensure the security of customer data. Security providers can offer SSL certificates, encryption devices, firewalls, and tools to help you comply with data protection regulations.
The customer likely won’t notice the various security services integrated into your ecommerce infrastructure. Still, if you don’t have certain security features, like an SSL certificate, your site can be penalized by search engines and browsers.
Order fulfillment tools automatically manage orders from the point of purchase to final delivery. The process includes invoicing, shipping, and tracking. Here’s what that looks like in the case of an individual purchase of shoes:
Upon successful payment, the customer receives an order confirmation via email or on the website. Simultaneously, the ecommerce platform’s order processing system records the purchase, deducts the shoes from the inventory, generates an invoice, and notifies the warehouse or relevant department for packaging and shipping.
The ecommerce infrastructure communicates with the warehouse or order fulfillment center, providing necessary shipping details and generating shipping labels. The shoes the customer ordered are packed, labeled, and handed over to the shipping carrier.
Customer relationship management (CRM)
Ecommerce platforms use CRM (customer relationship management) tools to manage customer information, interactions, and marketing efforts to enhance customer retention and satisfaction. They handle everything from basic customer service to managing complicated returns.
Web analytics and reporting
As an ecommerce business grows, it may increasingly use software applications that gather and analyze data to provide insights into customer behavior, sales trends, and overall business performance.
Post-transaction, the ecommerce infrastructure collects data on the purchase, including customer behavior, sales trends, and inventory levels. These analytics help the online shoe store optimize future marketing strategies, inventory management, and user experience.
Scalability and performance optimization
Selling goods and services online means relying on infrastructure designed to handle varying traffic levels. Careful infrastructure planning helps ensure your ecommerce store will respond quickly during peak times and can accommodate growth.
Integration infrastructure allows you to seamlessly connect to other internet systems or third-party services, such as social media, marketing tools, and analytics tools.
How to choose the right ecommerce infrastructure
- Align your infrastructure with your business model
- Prioritize scalability and flexibility
- Be mindful of security measures
- Research technical compatibility and integration potential
- Demand analytics and performance monitoring
- Consider cost-effectiveness and efficiency
Choosing the right infrastructure is among the most important tasks facing ecommerce businesses. Here are some tips for choosing new technologies to optimize your ecommerce environment:
1. Align your infrastructure with your business model
Ensure the ecommerce infrastructure fits your business model. Whether it’s a B2B, B2C, or hybrid model, the infrastructure should support the specific requirements of your business operations, including customer engagement, sales processes, and managing supply chains.
2. Prioritize scalability and flexibility
Evaluate whether the infrastructure can accommodate growth and changes in your business and the ecommerce environment at large. The best ecommerce infrastructure should be able to handle increased web traffic, support multiple web pages, integrate with different operating systems and applications, and scale up as needed.
3. Be mindful of security measures
Assess the security features offered by the prospective ecommerce infrastructure. This includes firewall solutions, encryption devices, and protocols for securing financial transactions and customer data.
4. Research technical compatibility and integration potential
Consider the compatibility of your hardware infrastructure, including specialized servers, database servers, and application servers. On the software side, your operating systems should support seamless integration with communication protocols, search engines, proxy servers, and other software systems crucial for ecommerce operations.
5. Demand analytics and performance monitoring
Look for infrastructure that provides robust web analytics and monitoring capabilities. This helps in tracking and analyzing customer behavior, sales trends, and website performance. You can use information from analytics and performance monitoring to make data-driven decisions, improve efficiency, and bolster customer satisfaction.
6. Consider cost-effectiveness and efficiency
Assess the cost implications of the infrastructure in relation to the value it offers. Evaluate whether it optimizes warehouse space, enhances fulfillment processes, and utilizes in-house resources effectively (such as integrating with an existing human resources team or an in-house bookkeeper).
The best ecommerce infrastructure can also accommodate a wide array of customer interactions, like handling sales phone calls or selling on alternative channels. Prioritize solutions that provide greater efficiency and multiple ways to improve operations at a relatively low cost.
Ecommerce infrastructure FAQ
What are infrastructure issues in ecommerce?
Infrastructure issues in ecommerce can encompass challenges related to scalability, security, integration, communication protocols, and adaptability of technological components. Each is an important factor in online business operations.
What is an example of ecommerce infrastructure?
An example of ecommerce infrastructure could be a system comprising web servers, secure payment gateways, inventory management software, and customer relationship management tools working together to facilitate online transactions and operations.
Is there specific infrastructure you need for ecommerce?
Yes, specific infrastructure is among the core business requirements for effective ecommerce operations. Proper ecommerce infrastructure includes a web server, secure payment gateways, inventory management systems, software for order validation and fulfillment, and robust security measures.