For most of human history, you had to be in the same physical location as as a merchant if you wanted to buy from them, whether that was a pair of new shoes or clothes for your family.

At the beginning of the 21st century, we saw a huge surge in the way that the internet was used with regards to buyer-seller interactions for hard goods. Companies like Ebay, Amazon, and Alibaba have flourished, offering cheap quality goods and prompt delivery services.

These companies have effectively become the “Walmarts” of the internet, competing on price, a large selection, and seller reviews.

However, it’s only been in the last few years that we’ve begun to see a new trend emerging: the evolution of ecommerce among small and individual business owners.

Now, rather than having to live by a local seller who makes unique stylish apparel, sculpts incredible figurines, or designs beautiful jewelry, you can buy their products online on Etsy or through their Shopify-powered webstore.

In this post, I’m going to cover a few key advantages of running your own online ecommerce store over having a physical storefront.

1. Fewer costs

Without a physical storefront, you won’t incur rental or management costs. Your only costs will be the software you use to set up the online store, labor, and any money spent on marketing or advertising.

2. Visitor tracking and statistics

Google analytics makes it extremely easy to see where people are finding your website, which pages they are visiting, and from what region of the country they are hailing in from. You can also use tools like Crazy Egg and MouseFlow to analyze cursor movement as they browse your web store.

It would be very difficult to get these kinds of statistics regarding merchandise browsing patterns or visitor traffic with a physical store.

3. Search engine traffic

Search engines are the holy grail of online activity. Rather than constantly pushing out marketing messages and trying to attract people to your store, a search engine will pair a customer’s search queries with products and information that exists online.

If you rank well in a search engine like Google, then you will receive recurring monthly traffic that can convert into a steady flow of incoming sales. If your product is on Amazon, you can also get traffic from their search engine.

4. Social media traffic

While at one point in time, only bloggers like myself had the ability to voice opinions and influence buying patterns of new products. Now, everyone has the ability to speak their mind or recommend products to their friends on Facebook, Twitter, Pinterest, LinkedIn, Instagram, and more.

Now, if the link to your website goes viral or you have a news article written about you which is received well, you can capitalize on all of the social media traffic and turn it into sales from around the country.

5. Product inventory tracking

Since a purchase of your product is happening online, you can easily send that order to your fulfillment company (if you have one) or track where that product is in the fulfillment process as it’s being shipped out to the customer.

You can also track how much of a product you have left in your storage unit or when you need to order more items from your wholesaler or manufacturer.

6. Customer email communication

This is my personal favorite. When a customer comes into your physical store, it’s unlikely that you’re going to have the opportunity or ability to persuade them to give you their email address.

However, the online world is a completely different story! You must obtain their email address to send them an order confirmation and you can have an opt-in box which will enable you to send them future offers or marketing messages.

I recommend using one of these free or paid email marketing tools.

7. Written word of mouth reviews

You might have raving fans in your local community, but unless those fans continually voice their appreciation of your store to new customers, you’re going to have to hope that new customers check out your store.

Let’s say they are driving through town on a road trip. They might visit your store due to:

• Need
• Proximity
• Interest

If the third, you must convince them of the quality of your products and why they should make a purchase today, while they’re still in town.

Online, it’s easy to take advantage of customer reviews and reviews around the web to build credibility in the eyes of a potential customer.

8. Automated customer feedback and support

Every business must deal with customer feedback, questions, and issues. No customer wants to go to a physical store location and have to search a support manual, mail in a question, fill out a survey card, or talk to a customer support representative from another country.

Ironically, many online customers are more than willing to search a online support forum, email in a question, fill out a customer survey, or take advantage of a businesses’s 24-hour telephone support services, even if it means talking to someone in another country.

9. Labor cost advantages

Just because you are running an online store, let’s say, in Massachusetts, doesn’t mean that you need to set up a warehouse in Massachusetts or hire staff there. You can hire a staff member from out of the state or even out of the country to take advantage of tax or labor costs.

10. Location-independent management

Similarly to point #9, you also don’t need to be in Massachusetts in order to run your business. You could take a week off and be in Europe or on a beach in Malaysia, as long as you have a shipping and order fulfillment system in place.

11. Larger marketplace and marketing ROI

If you’re running a storefront in a small town in the midwest, you’re potential customers are limited to the population of that town and your marketing will only be as affective as the number of potential customers that see that marketing in the small town.

Once you have your own domain name and online storefront, you’ve now entered a world marketplace and your marketing can bring in domestic or international customers.

It’s true that you’ll be competing on a larger scale, but the wins or rewards that you receive from having great products and a good business are magnified.

12. Automated marketing engine

If you’d made it this far, you should be seeing a trend. The internet allows you to:

• Automate
• Scale
• Build a location-independent business

You can automate your marketing with social media software, email management tools, and a blogging engine. There are lots of ways that you can promote any kind of ecommerce store.

I recommend checking out these tools:

• Buffer or Hootsuite for social media scheduling and analytics
• Mailchimp or Aweber for email scheduling and analytics
• WordPress for blog post scheduling
• Google and Facebook ads.

13. Impulse purchases

Have you ever heard of “window shopping?” I’m sure you have. Basically, it’s when a customer will browse around stores in the area, looking at merchandise, and maybe make an impulse purchase.

For example, let’s say you have a storefront in a mall. People go there to eat, have fun with friends, and buy items or make impulse purchases.

A social media feed on Facebook, Instagram, or Twitter is basically like a mall. Users go there to look at funny videos, talk with friends, catch up on news stories, and basically hang out and kill time through their mobile device or computer

This is an awesome opportunity to capitalize on their free time by attracting them to your web store with cool photos and discounts or offers. They might see something they like and decide to buy it directly from their mobile phone while they are on their lunch hour!

14. Repeat customer and product data

Similar to search engine traffic, identifying repeat customers and particularly the products they buy most frequently is the golden goose of building a longterm successful business.

The analytics of a web store make it very easy to see which customers are your best customers and which products experience the fastest turnover.

If you were operating out of a physical location, your POS might have some of this functionality, but it’s likely that you’d have to remember who your good customers are and the items that are the most high-margin and responsibility for the majority of your store’s profit.

15. Advertisement tracking

Finally, it’s much easier to gauge and track the ROI of your marketing efforts through an online advertising platform like Google, Facebook, or BuySellAds.

You can A|B test messages, get click through data, and easily calculate your customer acquisition costs. It’s harder to do that if you’re doing a direct mail campaign, renting a banner on a freeway, or handing out flyers. You would need to make a tally of every customer that comes into your store and from which channel, which you could only do if you surveyed each one.