I’ve talked with a few users recently who initially chose to build a store on top of a “mall” managed by a big company. Sometimes this is the best choice and sometimes it is not. I can certainly discuss some of the pros and cons but I can’t tell you the best solution for your store. One generalization is that the pre-packaged online malls probably cost a bit less to get started. But they could have a much higher cost in the long run. Let’s discuss some of the options.

Hosting

Every online store needs to be hosted somewhere and the costs vary greatly. The big online malls typically have a monthly fee that includes hosting as well as the other ecommerce features. This is where the costs can differ greatly in the short and long term. Building your own store has higher startup costs, but the ongoing hosting costs are lower. So as you calculate, make sure to include at least a year in the cost.

Theme

With any site, a theme determines how the site will look. I’ve found that the good themes for the online malls costs 2-3 times as much as a good WordPress theme for building your own store.

Features

Online malls have a specific list of features they provide at the monthly cost. If you build your own, you have many choices for implementing ecommerce. Some options for building your own store have a flat fee and some have an ongoing cost. My favorite solution has a one-time $80 cost and it is loaded with features that often cost extra with other solutions.

Ongoing Costs

If you sell products, there are transaction costs involved with various payment methods. Some of the online malls charge a slightly higher percentage so they make a small amount on each transaction. Not a big deal if you have low volume, but this can add up if you have a lot more sales. There are also the ongoing monthly costs just to keep your store online.

Promotion

Where I find the online malls to be a problem for merchants is having to have their URL (Web address) as part of the address. Instead of having myonlinestore.com, you have something like myonlinestore.bigmallcompany.com. If you are trying to build a brand, it is very difficult since you are lumped in with thousands of other stores.

Switchover Costs

If you start with the online mall and then want to build your own store, you’ll find the cost of switching is the same as starting from scratch. Yes, it may take a little less time since you already have products and descriptions, but the site itself is no less expensive and the promotion will have to be started over as well.

So if you are thinking of starting an online store, look at all costs of both methods carefully. The money you think you may be saving in the short term could really cost you down the road. And you may actually find it isn’t any less expensive to build your own.

If you want to build your online store, I’d love to help. Look at some of the ecommerce projects we’ve completed and then contact us to discuss your needs.