The allure of setting up your own online retail store is obvious. After all, you have great taste, so why not share it with the world and make some money at the same time? You’ll be your own boss, travel the world looking for unique merchandise, and build a brand from the ground up.

Getting started is easy. Come up with a catchy name for your store, find out the domain is unavailable, come up with another one, then set up your shop using one of the many “robust” ecommerce platforms available. Countless others have achieved their dreams of owning their own businesses, and now you can too!

So I decided to go for it. I had a brief stint in wholesale women’s apparel at the beginning of my career and never lost my love for fashion. Since I had great taste in clothes (or so I thought), I was confident I could create a strong brand around my personal style. I came up with a store name I loved, reserved social media handles, purchased inventory, and held fancy photo shoots.

This is a little embarrassing for me to admit in this context, but I had spent the previous five years working for two different ecommerce companies, so I wasn’t a complete novice. My website was clean, easy to navigate, and SEO-optimized. I was using a popular ecommerce platform, but I had given a web designer I trusted almost free rein over the look and feel. The end result was beautiful.

The entire process took about six months. When I finally made the website public, I emailed my family and friends about its “soft launch” and waited for the sales to trickle in. I wasn’t expecting much at first, but I also wasn’t expecting next to nothing. Which is exactly what happened. Over the next year or so, I sold only a few thousand dollars worth of merchandise, ran out of cash, and eventually closed the store.

There are plenty of blogs and other resources out there with ecommerce success stories and best-practices and marketing tips. Most of them are worth a read, especially if you’re just starting out. With this article, however, I’m taking a different approach. I’m opening up about the mistakes I made in launching my site, in the hopes that this will be just as educational.

Mistake #1: I didn’t have a day job

I had left my day job for unrelated reasons, but rather than finding a new one, I decided to work on my business full-time — for free. I reasoned that in order for my website to have the best chance for success, I should be devoting all my time and energy toward it. It made sense at the time, but seems foolish in retrospect. My advice now would be to continue working full-time until your new venture has proven that it can replace your salary or you have raised enough money to draw a “living wage” salary from the startup funds.

Mistake #2: I didn’t invest my own money

In my initial outline for this article, I had “I didn’t raise enough money” as one of my mistakes. Yes, that is a common reason why startups fail, but in my case, that would have been a cop-out. I raised $65,000 from two family members — enough to design a simple website, purchase starter inventory, and still have some funds left over for marketing.

Many seasoned investors will not invest in companies in which the founders have not put up their own money as well. They understand that it’s far easier to spend other people’s money than your own. Had I invested my own hard-earned money into the business, I would have been much more thoughtful about how I spent each dollar.

Mistake #3: I paid influencers

We all know it’s important to have a strong social media presence, and we’ve all seen how powerful influencers can be. That said, sustaining a business around influencers takes more money (and energy) than most new entrepreneurs can afford to spend.

I hired several influencers to help promote my brand, either as models or to post about my products on their feeds. I looked for individuals who had decent followings, genuine engagement, and embodied my brand — and got almost nothing in return for the money. Sure, there was a moderate bump in traffic and followers, but the high volume of likes and comments didn’t translate into significant sales.

In the long run, I would absolutely recommend working with influencers. Given a limited marketing budget, however, it would not be my first choice. Looking back, how would I spend that money now? Let’s go to Mistake #4.

Mistake #4: I didn’t have any Google Ads experience

Most ecommerce stores can’t succeed without having a strong SEO strategy, but ranking organically for competitive terms is easier said than done. If you’re in a crowded field (as I was), it can take months/years to show up for popular keywords, and only after putting a lot of effort into obtaining quality backlinks.

If I could do it all over again, I’d spend most of my early marketing dollars on Google Ads — after learning as much as I could about it, of course. Yes, you are paying for each click, and yes, those clicks add up pretty quickly, but this will pay off in one of two ways: 1) Your products are awesome and your conversion is high, so your ROI is positive or 2) You’re getting clicks but no sales, giving you a clue that something is wrong (whether it’s the products, the pricing, or the site experience).

It’s important to keep building your brand and to focus on organic search, but in the initial stages, a successful paid search campaign can give you the momentum you need to keep going.

Mistake #5: I underestimated the power of Amazon

In my defense, this was a few years ago, before everybody had Prime and Amazon didn’t sell everything under the sun. That said, I learned the hard way to avoid products that are also available on Amazon. Amazon can beat me on price, shipping, even customer service. Case in point: I purchased something which was delivered promptly, but Amazon marked the order as undelivered and automatically processed a refund. I contacted Amazon’s customer service, and the super friendly representative told me to keep the product and keep the refund. It’s not easy for a small business owner to be that generous.

The lesson? Before spending a dime on inventory, do some thorough research on the vendor and product. It will be hard to compete with Amazon (or other major retailers) on staple or name-brand merchandise. On the other hand, it will be hard for Amazon to compete with small retailers on items that are exclusive, custom made, or one-of-a-kind.


I’m working on another online store, but here’s what I’m doing differently.

As you can imagine, this entire experience was extremely costly in terms of time and money. So, you might be surprised to learn that I’m not giving up on ecommerce altogether. I’m currently working on another online store, but I’ve made a few significant changes to my approach.

  • I am working for another ecommerce company during the day and working on my own business during the evenings and weekends. This means I can’t ramp up my store as fast as I’d like but this also means I’m less likely to make rash decisions out of desperation.
  • I’m not carrying inventory. For this website, my main focus will be on made-to-order home decor. This keeps my costs down in terms of buying and storing inventory as well as having to get rid of slow-moving items at a loss (ouch).
  • Rather than raising money, I’m only investing my own money. This inherently keeps me in check when it comes to spending since I’m not willing to lose more than $10,000 on a “proof of concept.” Of course, it helps that I already have a website I can use and I’m not purchasing inventory up-front.

Like most people reading this, I’m an entrepreneur at heart, so I’m not giving up yet. If there’s anything all entrepreneurs can agree on, it’s that we have to try.

Jenny Marshal – entrepreneurshandbook / Photo by Tom Parsons on Unsplash

Posted by BingoTraders