As an experienced webmaster with over 15 years in the industry, I‘ve helped hundreds of businesses build and grow successful online stores. One question I get asked constantly is:
"How much will it really cost me to create an ecommerce website?"
It‘s a great question, because costs can vary so widely based on your specific goals, products, features and more.
In this comprehensive guide, I‘ll break down all the key factors that impact ecommerce site costs so you can plan and budget effectively. I‘ll also offer plenty of tips, statistics, and real-world examples based on my expertise.
Let‘s dive in!
Contents
Ecommerce Continues Explosive Growth
First, it‘s important to understand just how big ecommerce has become.
- Global ecommerce sales hit $5.5 trillion in 2022, up 60% from $3.4 trillion pre-pandemic in 2019
- Ecommerce now comprises 22% of all retail sales worldwide
- Those figures are expected to grow another 70% to $7.4 trillion by 2025
This shift presents a huge opportunity for businesses to unlock new revenue streams online. But first you need the right ecommerce technology, infrastructure and budget in place.
What Are the Key Cost Components?
Several main components comprise the total cost of building and running an ecommerce website:
Ecommerce Platform and Hosting
Your ecommerce platform provides the core software, tools and hosting infrastructure to power your online store.
You have two main options:
- Open source platforms like WooCommerce that you install on your own hosting
- All-inclusive hosted platforms like Shopify that provide everything
WooCommerce Costs
As an open source WordPress plugin, WooCommerce itself is 100% free to download and use forever.
But you will need:
- Hosting: $7.99+ per month
- Domain name: $12+ per year
- SSL certificate: $69+ per year for security
Total starting costs: Around $240/year
WooCommerce gives developers full control and flexibility. But you need some technical skills to manage hosting and performance.
Shopify Costs
With Shopify, all infrastructure and hosting is included with your subscription fee:
- Basic Shopify plan: $29/month
- Standard Shopify plan: $79/month
- Advanced Shopify plan: $299/month
You still need to purchase your own domain separately.
Total starting costs: Around $408/year on the Basic plan.
Shopify is simpler to get started with, but transaction fees can eat into long-term profits.
Design and Customization
Out of the box, most ecommerce platforms offer templates and themes to choose from. But investing in a quality, customized design is key to standing out from competitors and converting visitors.
Your design and customization costs can range from:
- Custom design from scratch: $1,500 – $6,000+
- Customizing existing templates: $500 – $2,000
- Premium themes: $60 – $180
With over 10,000+ themes available, WooCommerce clearly has the most options. But Shopify and BigCommerce themes are purpose-built for high-converting ecommerce sites.
For example, spending $1,000 to work with a designer on customizing a WooCommerce theme can significantly boost sales and engagement.
Payment Processing
When budgeting your ecommerce site costs, don‘t forget to factor in payment gateway transaction fees. These average 2-3% of order values.
For example on a $100 order, Stripe would charge:
- 2.9% transaction fee: $2.90
- $0.30 flat fee: $0.30
Total fees: $3.20 per transaction
These can really add up, so aim for rates under 3% if possible.
Unfortunately, Shopify charges an extra 2% fee for using external gateways. WooCommerce and BigCommerce allow any processor without markup fees.
Add-Ons and Extensions
To enable key ecommerce functionality, you‘ll likely need additional plugins and apps beyond your core platform. These range from free up to $500+:
- Shipping calculators
- Tax automation
- Marketing integrations
- Accounting tools
- POS systems
For example, the highly-rated YITH WooCommerce Wishlist plugin costs $69 per year.
WooCommerce has by far the most options with over 50,000+ WordPress plugins available. Shopify and BigCommerce offer fewer but targeted ecommerce-specific addons.
Marketing and Growth Tools
Once your ecommerce site attracts initial traffic, you need marketing technology to collect emails, target ads, send notifications and more.
These tools aren‘t mandatory to launch, but are invaluable for sustaining growth. Expect to budget $100 – $300+ per month for options like:
- Email marketing software
- SEO/PPC ad platforms
- Push notification services
- Live chat platforms
- Marketing automation systems
For instance, Constant Contact‘s Email Marketing Pro plan costs $45/month for up to 500 contacts.
Now let‘s look at total costs…
What‘s the Total Cost for an Ecommerce Website?
With those key components in mind, what is the realistic total cost range for building and running an ecommerce site?
Basic Shopify Store
For a starter Shopify store with just a few products, you may budget:
- Shopify Basic plan: $29/month
- Domain registration: $12/year
- Theme customization: $200
- Payments with Shopify Payments: 2.9% + $0.30 per transaction
- Email marketing app: $10/month
Total basic cost for first year: Around $488
This Shopify setup allows you to test an idea fairly quickly and cheaply. However, growth and scaling up become expensive due to transaction fees and forced payment processing.
Custom WooCommerce Store
For a customized WooCommerce site with advanced design and features, plan for:
- WooCommerce hosting: $25/month
- Domain registration: $12/year
- SSL certificate: $69/year
- Custom theme design: $2,500
- Payment processing: 2.9% + $0.30 per transaction
- 5 add-ons/extensions: $500 total
- Monthly marketing tools: $100
Total first-year cost: Around $4,419
WooCommerce requires more technical skill upfront but gives you maximum control and flexibility for scaling. Costs are front-loaded for development, but ongoing fees remain affordable.
High-Volume Enterprise Store
Finally, a high-traffic store with huge inventory and order volumes may cost:
- Shopify Advanced plan: $299/month
- Domain registration: $12/year
- Custom design and development: $15,000+
- Optimized payment gateways
- Dozens of advanced add-ons: $5,000+
- Team of marketers: $60,000+ per year
Total annual cost: Over $100,000
Enterprise ecommerce requires serious capital and teams of specialized experts. But brands can manage millions in sales at these scales.
As you can see, costs vary widely. Next let‘s explore how to reduce expenses.
Tips to Reduce Ecommerce Costs
If your budget is tight, consider these tips to lower your ecommerce costs:
- Launch a minimal viable product (MVP) to validate your idea first before heavy investment.
- Take advantage of free trials for software and only pay for essential tools.
- Use a website builder like WordPress to avoid big development costs, then outsource specialized functionality.
- Optimize payment processing through gateways like Stripe to reduce transaction fees.
- Leverage free marketing channels like email and social media as much as possible.
- Consider a hosted platform like Shopify for convenience despite higher fees.
- Partner strategically with dropshipping suppliers and freelancers to minimize operational costs.
For example,Sendy offers an email marketing alternative starting at just $59 per year. Integrations with platforms like WooCommerce also reduce dev costs.
The key is incrementally improving your site over time, not building every feature upfront. Start lean and scale up sensibly based on revenue and demand.
Key Takeaways on Ecommerce Website Costs
Building a successful online store requires significant upfront and ongoing investment. But variables in platform choice, design, marketing and more allow you to tailor costs to your revenue and growth stage.
In summary:
- Expect total first-year costs from $500 to $100,000+.
- Platform, development and marketing represent the biggest expenses.
- Prioritize flexibility to easily scale up (or down) as needed.
- Reduce costs by launching lean, partnering smartly and only using essential tools.
With the right strategic technology foundations and budget, any ecommerce business can thrive online. Focus on consistently improving value for customers, and your long-term revenue potential is unlimited.
I hope this comprehensive guide gives you clarity on planning and budgeting your exciting new ecommerce site! Let me know if you have any other questions.
