With a heavy increase in eCommerce sales in recent years, more and more businesses recognize the great opportunity eCommerce websites offer for trade. Indeed, online shopping is predicted to reach about $2,356 trillion by 2018 worldwide, which is twice as much as in 2012. While it seems obvious that a site is a must for every brick-and-mortar retailer, why not all of them have already gone online? Probably, the major reason is the high website development cost.
E-Commerce Website Cost Breakdown
So, how much does it cost to build an eCommerce website and what is the lowest price for it? Before cost estimation, we’d better compare website development with a house building. There is no standard price; it varies greatly depending on a project, a house’s size, building materials, the scope of work, and other factors that derive from customer requirements. The same is with online retailers as their price includes the following eСommerce website costs:
- The platform the website is developed on
- The website customization
- The website design and content
- The hosting
The choice of a platform depends heavily on what customers expect to get from their online shopping solutions. For small businesses, no-frills open source platforms may be a workaround, as they are available for free or have cheaper licensing cost, and allow to be set up and configured by the business owner. Bigger companies most probably demand more sophisticated website structure and capabilities, that creates a need in a highly configurable platform that supports significant customization.
Let’s illustrate how the platform influences the cost for eCommerce websites development by an example of the leading platforms that most businesses rely on. Statistics shows that WooCommerce, Magento (both Community and Enterprise editions), and Shopify are the Top 3 most frequently used platforms worldwide. Their respective shares are 24%, 15%, and 9% among the top million websites. The key factor for such a popularity is that they provide the capability to develop unique solutions that best suit individual companies’ requirements.
A free plugin for WordPress, it allows adding mainstream functionalities to WordPress websites. However, it allows significant customization by downloading or buying needed extensions or themes that expand its embedded functionality or improve the user interface. The combination of its free-of-charge basis and extended configurability makes WooCommerce so popular among the online merchants of all sizes, both for startups and well-established companies.
This open-source eCommerce framework allows using its embedded configurability, as well as to download or purchase needed modules in Magento pools. One of the advantages of using Magento is that the platform provides unlimited customization and flexibility to mold it into any form a customer chooses. At the same time, its high capacity for customization results in the platform’s maintenance complexity, which requires outsourcing. Also, the annual Enterprise edition license is quite expensive ($17,900) that pushes up Magento website cost even more. This all makes a Magento-based online retailer a good fit for eCommerce sites of medium to large sizes, and such big players as Nestle, Philips, Olympus, Men`s Health, and Christian Louboutin have decided on it.
A one-stop-shop platform, Shopify requires little to none professional knowledge for its maintenance, while it allows adding desired features to online stores. There are 4 license plans available: Lite – starting at $108/year, Basic – starting at $348/ year, Pro – starting at $948/ year, and Unlimited – starting at $2148. This all makes it a good choice for small businesses, but such big customers as Tesla, Google, and Wikipedia also enjoy the platform’s advantages.
4. Platforms For Large Businesses
Even though it’s not on a Top 3 list, such big players as SAP Commerce Cloud, Oracle Commerce and IBM WebSphere Commerce should not go unmentioned. Although the solutions are quite costly, large companies with multi-billion revenues don’t have much choice other than go for them, as the platforms provide the required customization capabilities to support high volume operations. The platforms power up properly tailorable websites that meet specific customer needs and allow synchronization with solutions for accounting, manufacturing, finance, stock control. Levi’s, GE, CVS, Walmart, Nikon and Ikea build their eCommerce solutions on the basis of these platforms.
The Platform’s Customization
Acquiring a license is only the first step on the way to a full-fledged online shop. Further, the platform must be customized in accordance with the business needs and specifics. This includes proper platform’s setup and configuration and adding necessary modules and extensions.
Some platforms don’t require specific expertise and are so easily-manageable that even a business owner can develop an eCommerce website on their basis. However, the implementation of such sophisticated solutions, as Magento or SAP Customer Experience, cannot go without outsourcing development services.
Moreover, in most projects platform’s embedded features are enough. A lot of companies have thousands of goods on their price lists, provide shipping and accept various types of payment. In such cases, a website needs a lot of pages to be created, payment systems to be connected, and some other functionalities (blogging tools, shopping carts and so on) to be set up.
So, thousands of extensions and modules are available for download or purchase, that may cost up to $250 or $500 for a WooCommerce and Magento ready-made modules respectively. But it may happen that customers cannot find their silver bullet among off-the-shelf plugins, then they go for custom module development. The help of professional developers is rated from some 10s to hundreds of US dollars per hour on the average, and the longer their work on a project lasts, the costlier it becomes. So, how long does it take for a developer to build a site? The answer is as always: it depends. However, basic configuration stands in about $5,000.00, say nothing of the tailoring of a more extended website.
Also, business owners should consider the expenses on staff training or a new team hire for CMS management and maintenance in cases of large catalogs and extended website features.
The Website Design and Content
Among the diversity of similar online shops, retailers need to gain customers’ attention to their offerings and hold it. That is why businesses make so many efforts to provide an interactive and responsive web design, good usability, high-quality graphics, and insightful content.
There are ready-made themes and templates that can be downloaded or purchased to improve the website’s interface and functionality. While they allow to get off cheaply ($250 at most), such an approach is not a way-out for businesses that seek to distinguish themselves. So, such companies turn to custom themes, which may cost $1,000.00 and more, up to dozens and hundreds thousand US Dollars.
Besides eCommerce website design, cost of site development also includes site’s contents. As the more informative it is, the more time a user spends surfing it, which encourages sales. For most retailers, a third-party participation in creating visual and written content is an optimal solution, as it’s quite a time- and resource-intensive task. As always, the expenses on the website content depend greatly on its amount.
The Web Hosting
Compared to the vagueness of customization cost, the situation around hosting is clearer. Rate plans that small SaaS platforms provide vary from $20 to $250, and some of SaaS platforms service providers even include certain hosting services into their packages. However, a website’s requirements for hosting grow in line with its development. So, a successful individually tailored website with average requirements to scale, security, and speed will consume $1,000.00 – $2,000.00 a month.
Approximate Cost Breakdown for eCommerce Sites
So, the analysis of the eCommerce website development cost breakdown proves that the main factor that determines the price is the project scale and business owners’ preferences. A company may decide on having all the needed features individually tailored for them regardless of the cost, as well as they can go for cheaper ready-made solutions that are still attractive and applicable.
However, below are the average prices for the development of eCommerce sites for small, medium, and large businesses respectively, which of course should not be considered as a guidance:
For small businesses – from $2K (based on open-source software) to $11K (based on a hosted eCommerce platform)
For medium businesses – from $5K (based on open-source software) to $15-30K (based on a hosted eCommerce platform)
For large businesses – from $10K (based on open-source software) to $30-400K (based on a hosted eCommerce platform)
Ask Your Service Provider for a Cost Estimation
The above numbers and examples of how the cost for eCommerce website development is made up are rough ones, which are available on the Internet. They describe cases with no specific requirements, just with basic projects. And such a calculation of an average cost to develop an eCommerce website proves that it’s nearly impossible to estimate the price without knowing the website’s specifications. So, the only way to know the custom eCommerce website development cost for sure is to turn to a service provider to get their expert price estimation. Also, only the experts can suggest to you how to build an eCommerce website you need at the optimal price.