Ecommerce software allows online businesses to accurately receive and fulfil customer orders. It’s designed to streamline your processes and improve overall business efficiency – and it comes in many forms.
Here we look at how ecommerce software works and the different types of ecommerce software – and compare features, reviews, and pricing to determine the best platforms currently on the market.
What is ecommerce software?
Ecommerce software refers to specialised applications and platforms designed to facilitate online business transactions. Functionality varies greatly between different systems, and ecommerce software can be used for a range of purposes. Popular use cases include inventory management, order management, accounting, multichannel sales, and shipping.
In technical terms, ecommerce software serves as the digital infrastructure that enables businesses to conduct various aspects of electronic commerce. A common example of this would be an app that facilitates the sale of products or services over the internet by providing a digital shopfront for businesses.
Today, there are over 1000 products listed under the Ecommerce Software category on popular software review site, Capterra. This speaks to the growing need for automation in the ecommerce space.
Ecommerce software assists businesses with nearly all aspects of their operations, from stock control to purchasing and sales.What are the benefits of implementing ecommerce software?
Ecommerce software streamlines the online purchasing process, making it easy for customers to browse products, add items to their cart, and securely complete transactions.
For businesses, the uses of ecommerce software are numerous. They include helping you to:
- Establish an online presence
- Engage in marketing
- Track and manage inventory levels
- Process orders efficiently
- Integrate with payment gateways to facilitate secure online transactions
The ecommerce market is expected to be worth $6.9 trillion by the end of 2024. For product-based firms, this indicates that neglecting to invest in ecommerce may result in a major missed opportunity.
In short, ecommerce software provides the necessary tools and functionalities to conduct business online cost-effectively and with minimal friction.
How does ecommerce automation software work?
Ecommerce automation software works by automating repeatable tasks that would otherwise be handled manually and at the seller’s expense. Common processes that may be streamlined by ecommerce software include data entry, order processing, and stock optimisation.
In this way, ecommerce software saves companies hours (and therefore dollars) while reducing the risk of inaccurate data posed by manual human input.
Ecommerce software: Category breakdown
We can break ecommerce software down into four basic categories:
- Software as a Service (SaaS)
- Platform as a Service (PaaS)
- On-premise software
- Plug-ins and apps
Software as a Service (SaaS)
Hosted on cloud servers, SaaS platforms eliminate the need for businesses to manage on-premises infrastructure, enabling accessibility from anywhere with an internet connection.
These tools are typically subscription-based, meaning companies pay a monthly or annual fee for access to the software’s functionality, cloud hosting, and customer support – along with any future system updates.
In simple terms, SaaS tools automate repetitive tasks and workflows and connect different areas of a business such as inventory, order fulfilment, and finance. It is designed to scale with the growth of a business while providing security measures to safeguard sensitive data.
Platform as a Service (PaaS)
Like SaaS solutions, PaaS ecommerce software operates on a subscription basis. It integrates with other ecommerce systems and tools – such as storefronts, inventory management platforms, and payment gateways – and is designed to be flexible and customisable.
While they are similar, the main difference between SaaS and PaaS tools is that PaaS provides a platform allowing developers to build, deploy, and manage custom applications without dealing with the complexities of infrastructure management.
On-premise ecommerce platform
An on-premise ecommerce automation platform refers to a solution where the entire ecommerce system is hosted and operated locally on the business's own servers and infrastructure.
Unlike cloud-based solutions, an on-premise ecommerce automation platform gives your business direct control over the entire hardware. However, because the solution is in-house, ongoing maintenance, updates, and patches are the responsibility of the business.
On-premise solutions often involve a significant upfront investment in the form of software licences and hardware infrastructure. However, while this model can have higher initial costs, it may result in lower ongoing subscription fees.
Ecommerce plug-ins and apps
Ecommerce plug-ins and apps are additional pieces of software that businesses can integrate into their existing online platforms to enhance functionality and add specific features.
In many cases, these tools can also be classified as PaaS or SaaS systems.
Plug-ins and apps are typically found in a dedicated marketplace or through your core platform’s app store. Installation is usually a straightforward process that involves downloading the tool and activating it within the ecommerce platform's admin interface.
While plug-ins and apps can significantly enhance an online store's capabilities, it's essential to vet the security of these additions. Using reputable and well-reviewed apps reduces the risk of vulnerabilities that could be exploited by malicious systems.
Ecommerce automation software can be operated by cloud systems or hosted on an on-premises hardware system.Types of ecommerce software
Thanks to the aggressive rise of online retail, there are now software solutions for nearly every aspect of running an ecommerce business. Here we look at some of the most common types.
Ecommerce order management software
Ecommerce order management software is a tool designed to streamline and centralise the order processing workflow for online businesses. It facilitates the efficient handling of orders from placement to fulfilment.
Order management software solves problems related to order processing bottlenecks, delays, and errors by automating tasks such as order tracking, inventory updates, and communication with customers.
Key order management software features:
- Order fulfilment
- Order tracking
- Inventory synchronisation
- Real-time order status updates
- Sales reporting
- Multichannel integration
Ecommerce accounting software
Ecommerce accounting software focuses on managing financial transactions and reporting for online businesses. It helps you track revenue, expenses, and taxes within a single platform.
Ecommerce accounting software aims to solve problems related to manual financial management, inaccuracies, and compliance issues.
While some tools, such as Xero or QuickBooks, provide generalised accounting functions for all types of businesses, ecommerce accounting comes with unique challenges. As a result, there are also many ecommerce accounting specialist tools, such as A2X and Link My Books, designed to specifically help online merchants.
Key ecommerce accounting software features:
- Automated bookkeeping
- Tax management
- Financial reporting
- Invoice management
- Integration between cloud accounting systems and sales channels
- Cash flow management
Ecommerce inventory management software
Ecommerce inventory management software helps you effectively manage your inventory stock – from purchasing through to stock control and fulfilment. It’s useful for ecommerce businesses of all sizes, particularly those dealing with a large and dynamic product catalogue.
Inventory management software helps you prevent stockouts and overstock by ensuring there is always an optimal level of inventory available to be used or shipped out. It also saves you time by automating manual processes such as stock checks, data entry, and sales order synchronisation.
Key ecommerce inventory software features:
- Real-time inventory tracking
- Purchase order management
- Supplier management
- Inventory reporting
- Demand forecasting
- Automated reorder alerts
B2B ecommerce software
B2B ecommerce software helps facilitate business-to-business transactions, such as bulk inventory being sold by a manufacturer to a retailer. It solves problems associated with complex pricing structures, bulk orders, and personalised catalogue management.
Key B2B ecommerce software features:
- Online B2B sales platform
- Account-specific pricing
- Bulk ordering
- Custom catalogues
- Multi-tiered user access
Multichannel ecommerce software
Multichannel ecommerce software makes it easier and more efficient to sell products across various online channels, such as marketplaces, social media, and your website. By integrating key functions such as sales reporting and ecommerce inventory management, multichannel software makes it easier to grow revenue and reduce costs.
For example, if you have the same product listed on Amazon Marketplace and Etsy, a multichannel ecommerce system will ensure that stock levels are up-to-date and accurate across both channels. This prevents accidental overselling or understocking, and helps you track sales performance across the business as a whole.
Key multichannel ecommerce software features:
- Centralised product management
- Cross-channel sales reporting
- Inventory synchronisation
- Multichannel order management
- Order fulfilment automation
Ecommerce analytics software
Ecommerce analytics software gives you practical tools to help analyse and derive insights from your ecommerce sales and customer data. It can help you understand important factors that influence business strategy, such as customer behaviour, product popularity, and seasonal trends.
Key ecommerce analytics features:
- Sales analytics
- Customer behaviour tracking
- Conversion rate analysis
- Customisable reporting
- Demand forecasting
Ecommerce marketing software
Ecommerce marketing software focuses on tools and features to optimise marketing efforts for online businesses. It can help you attract, engage, and retain customers through various digital channels.
Marketing software comes in many forms, from email automation tools to CRM platforms and SEO tools. But the core objective of these systems is the same: to improve the effectiveness and efficiency of your marketing efforts.
Key ecommerce marketing software features:
- Email marketing automation
- Social media marketing automation
- Search engine optimisation planning and research
- Customer segmentation
- Paid advertising management
Ecommerce fraud prevention software
Ecommerce fraud prevention software is designed to protect online businesses from fraudulent activities and unauthorised transactions. It helps resolve common issues around chargebacks, identity theft, and financial losses due to fraudulent transactions.
Key fraud prevention software features:
- Real-time transaction monitoring
- Fraud detection algorithms
- Secure payment gateways
Ecommerce shopping cart software
Ecommerce shopping cart software is a tool that enables customers to select and purchase products from an online store. It helps ensure the smooth and secure completion of the online purchasing process.
Key ecommerce shopping cart software features:
- A user-friendly interface
- Secure payment processing
- Integration with inventory and order management systems
- Conversion rate optimisation
- Abandoned cart email marketing triggers
Consider your main business objectives and challenges to identify the optimal ecommerce software for your requirements.What is ecommerce software development?
Ecommerce software development refers to the process of creating and customising software solutions specifically designed to facilitate online business operations. This includes the design, development, implementation, and maintenance of software applications that power ecommerce websites and platforms.
The goal of ecommerce software development is to create a seamless and user-friendly digital environment that enables you to showcase and sell your products or services online. These platforms play a crucial role in enhancing the overall online shopping experience, optimising business processes, and ensuring the security and reliability of digital transactions.
The process of ecommerce software development involves coding, testing, and deploying software that aligns with the unique needs and goals of the ecommerce business.
