Hosted vs Dedicated Ecommerce Platforms

Hosted vs Dedicated Ecommerce Platforms

150 150 Yoel Sommer
E-Commerce

E-commerce is taking a bigger portion of overall retail sales in the United States and it’s not surprising by now to see more small businesses moving some, or all, operations online.

An E-commerce is a type of website platform that is used to serve an electronic commerce website. E-commerce hosting differs from standard web hosting in that a number of features and functionalities are required to manage and run a commercial website. This includes SSL, database support, shopping cart software, payment processing services, and security initiatives. Ecommerce platforms are designed to provide entrepreneurs and businesses with all the tools and services required for them to set-up, manage and conduct an ecommerce business.

Most E-commerce platforms will provide the basics to get you started. This includes customizable site templates, an integrated shopping cart, search engine optimization (SEO), email marketing, inventory management and analytics. All you need to do is create an account and use store management tools to customize your ecommerce presence.

Unless your business runs a massive web operation, the issue of hosted vs. dedicated E-commerce will probably be a consideration as you plan present and future Internet needs. We’ll outline the differences in options, and some considerations to better assess the need to build your own store vs using a subscription-based e-commerce platform.

Hosted e-commerce platforms.

The best reasons for using hosted ecommerce software are the low cost and lack of IT requirements. Another benefit is that many solutions are designed to grow with your business: you typically won’t pay for features you aren’t using today, but you have the option to upgrade services and features as needed.

A hosted platform is sometimes called “shared” because your site will share resources with others: a third-party service provider hosts your servers for a monthly fee on their equipment; multiple sites are running (hosted) on the same physical server.

In this case, your company is responsible just for the content: the service provider handles all the other details, including server setup, bandwidth management, backups, security and more.

Small-to-medium businesses are better off looking at small, hosted solutions, giving enough flexibility to grow their business over the coming years.

Some examples of hosted e-commerce platforms are: Shopify, BigCommerce, Mozu.

Dedicated e-commerce platforms.

To truly build a brand online, retailers will at some point need to consider creating a dedicated e-commerce channel with a dedicated platform. Dedicated platforms give the maximum freedom, and are fully adjustable to the business’ needs.

Scalability is a key reason to adopt a dedicated e-commerce platform. Larger businesses need to consider things like integration, scale, fulfilment and perhaps international visibility. A dedicated platform is recommended for high-traffic or volume stores where investments in hardware, staff and bandwidth are budgeted and expected.

Once a business has scaled to the point where there’s a clear need to manage purchasing and inventory by using an enterprise resource planning (ERP) system, it’s usually time to begin looking at more robust and flexible platforms that offer scale and performance, and can be modified for your own (perhaps unique) business requirements. Ideally, you will want to find a development partner that is a qualified representative of the product you are looking at.

Examples of dedicated e-commerce platforms include: Magento, NopCommerce, AspNet StoreFront.

How to decide.

To find the right e-commerce platform, have a look at what you really need now, as well as for the coming two-to-three years.

  1. Price: the first advantage to shared hosting is price. You’re using just a part of a single server, so the costs are spread among multiple companies. You’re not directly managing the servers, so you don’t need to divert any IT resources to a web project
  2. Security: hosted platforms are managed and guaranteed by the service provider
  3. Support: for your database, and from IT
  4. Features and limitations: plans in hosted platforms will have some limitations, plus you can’t just add a service on your shared server without the cooperation of your service provider. Dedicated platforms are flexible and offer scale and performance