Businesses are moving to the ecommerce model to cater to the dynamic changes in the market. Moving your business online not only makes it more accessible to the target audience, but it also broadens your brand reach because of the potential of tapping undiscovered audience pools.
You’re now probably wondering what it takes to shift your business online. In this article, I will discuss the relative ecommerce website costs of moving your business online. I will highlight the tools and platforms that you can explore in order to pick the best fit for your requirements and technical skills.
Let’s look at some of the factors that influence the cost to build an ecommerce website.
What Platforms to Choose?
In the world of ecommerce, Magento is a favorite among business owners. The platform is ideal for stores that have high SKUs, and offer simple and easy inventory management. Magento is well known for its reliability and compatibility with the majority of hosting providers.
On the other hand, WooCommerce (perhaps the most popular WordPress plugin) is well known for the easy learning curve and the plethora of themes, and extensions available from official and third-party marketplaces.
Factors in Calculating Ecommerce Website Cost
A number of elements influence the cost of the ecommerce website. I’ve listed the most important factors that can hike up the cost of creating ecommerce websites.
i. In-House vs. Outsourced Development
The choice between in-house and outsourced development is an important decision that has a serious impact on the overall budget. An inhouse development team could get expensive very quickly, but has a quicker turnaround time. On the other hand, a remote software team or a freelancer is a relatively affordable option (depending upon location, experience and portfolio). However, the turnaround time and communication could be a challenge. This is the main factor that can influence your ecommerce website development cost.
ii. Complexity of Design
You’ll need to understand the relationship between the complexity of a website and how it impacts your ecommerce website design cost. To give you a perspective of the relationship between complexity and costs (and time), consider this:
A one-pager website (with five folds) is usually ready in a couple of hours. On the other hand, an ecommerce store takes a month or two to get out of the staging area. Given the effort involved, the cost of developing is generally proportional to the complexity and time frame.
iii. Choosing an Appropriate Hosting Solutions
The hosting solution is a serious cost factor that is very dependent on your business requirements. You have the choice of shared (not recommended for ecommerce websites), VPS and cloud hosting solutions and you should pick one that fits the requirements of your business operations and available budget.
If you wish to focus completely on your business and avoid all hosting hassles, I highly recommend a managed cloud hosting solution.
iv. Marketing Services to Go For
This is again an in-house vs. outsourced solution. Many ecommerce businesses prefer to handle SEO and marketing activities in-house because of the requirements of protecting the digital marketing strategies. On the other hand, there are very popular agencies that deliver a full-service digital marketing and optimization experience at a very reasonable price.
Remember that this is a sensitive area with direct impact on your brand positioning and reach.
v. Choosing the Right Content Management System (CMS)
The choice of a particular CMS depends on your business processes, the target audience and the inventory management. The good news is that most of the popular CMS are free – WooCommerce, Magento, PrestaShop are all available free of cost. The actual cost of these platforms lie in the choice of paid extensions and themes that extend the capabilities of the platform.
So how do all these variables mean, and how they come together to help ecommerce website owners arrive at the cost of building an ecommerce website.
How to Calculate the Cost of Building an Ecommerce Website?
If you’ve been browsing the internet to get an idea of the cost of creating an ecommerce website, you’ll stumble across online ecommerce website cost calculators.
At best, the numbers generated by these tools are a hit or a miss as the cost varies because of location, design, and functionality of the website and type of the hosting solution.
Let’s take a slightly old-school approach and look at the cost of each item on the list and see the upper and lower limits of these cost items.
We have already published detailed articles on the costs involved in building WooCommerce and Magento powered websites.
Note: I have excluded website builders such as Shopify and Wix from this estimation breakdown because they follow a very different approach to building websites, and thus are out of the scope of this guide.
1. Price Estimates for Creating a Custom Design
This is the first step of setting up your ecommerce website (assuming you already have a business plan ready). This is where you’ll want to customize a theme and create a completely custom design for your website.
Picking the theme is often the starting point of the custom design project. You can find dedicated marketplaces for themes for WooCommerce, Magento, and multiple content management systems from ThemeForest, Magento Marketplace, and TemplateMonster. These templates can bring your ecommerce website cost to $100 to $200.
You can expect to spend somewhere between $1,500 to $5,000 for a custom design. However, the cost can shoot up to $10,000 to $50,000 for an enterprise-level custom design which consists of multiple internal pages for products and product categories.
2. Price of Developing Your Ecommerce Website
Now that the design is built, the next step is to bring the design to life. This is done through the code that connects all the dots and acts as the “muscles” that power the ecommerce websites.
The starting point of the development process is the choice of the platform. The popular choices are WooCommerce and Magento. However, large scale multifront stores are built on a custom PHP foundation (that cost a whole lot more that CMS based development). Other steps in the development process could include:
- Developing the integrated inventory management component
- Testing and finalizing the payment gateway and payment methods
- Testing and finalizing the plugins or extensions
Hiring a developer can cost you anything between $15 – $30 per hour with an upper limit of $150 for fully customized development from ground-up. Hence, hiring a developer can significantly impact your ecommerce website development cost.
3. Cost of Acquiring a Domain
If you want people to visit your online store, you’re going to need a domain name that acts as the address for the store. A domain adds about $10 – $20 to your ecommerce website cost, depending upon the domain registrar, TLD, and whether you’re buying the domain from a third-party.
4. Choosing the Right Hosting Plan
When considering a hosting solution, always consult your developers to find a good match of the developers’ requirements and avoid surprises when the website goes live. That’s because hosting can also be a major contributor to your ecommerce website cost.
You need a hosting solution that offers an easy entry point in terms of costs and is able to keep pace with the growth of your business. In addition, you need a solution that allows you to keep your focus on your business processes.
As mentioned earlier, I recommend managed cloud hosting because you get all the power and features of cloud hosting without the hassles of managing the servers. While you can easily spend as much as hundreds of dollars a month on hosting solutions, you can start from double digits and then progress upwards.
If you’re using Magento, you should opt for a 2GB server at minimum because of the higher requirements of server resources. Anything below 2GB is inadequate and your server would crash with your visitors seeing 404 Page Not Found and 502 Bad Gateway errors.
TIP: The close the server location is to your audience, the better the website performance
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5. Picking Plugins and Extensions From the Marketplace
Plugins and extensions extend the capability of your core application and allow you better leverage the power of the application for your business.
Popular ecommerce platforms such as Magento and WooCommerce support a wide range of plugins and extensions, available from official and third-party marketplaces.
Experts suggest using plugins and extensions developed by trusted developers with a track record of performance and secured products. As you see from the following screenshot of the WooCommerce Extension collection, the extensions add ready-made solutions for common business challenges.
You’ll find more details on installing WordPress ecommerce plugins and WooCommerce plugins in our blog. Some extensions and plugins are free while others are paid. You can expect to pay anything from $10 to $300 for plugins and extensions as part of ecommerce website cost.
The same applies to Magento where several popular development agencies provide industry-standard extensions that integrate everything from payment processors to store-level cache into the Magento stores. These extensions are a bit more expensive with prices starting from $30 and going all the way to $500 and beyond.
6. Cost of Marketing Agency vs DIY
When it comes to marketing your business, you can either hire an agency or choose to go the DIY way. What’s the difference and how does it impact your business? Let’s take a look how marketing impacts the cost of an ecommerce website.
Here in the tables below, I’ve elaborated on different marketing activities and their relative cost according to two separate tiers of agencies. Tier-1 agency has been in business for the last 20 years or so, and provides complete support. While tier-2 agency works on a nickel and dime model with lower upfront costs than Tier-1 agency.
Note: these quotes are estimates and are subject to change based on location and time.
| Marketing Activity | Tier 1 Agency (Monthly) | Tier 2 Agency (Monthly) |
| Content Marketing | $5,500 | $5,000 |
| Blogging | $2,000 | $1,500 |
| Paid Social Media | $4,400 | $4,000 |
| Pay Per Click / Google Ads | $6,200 | $6,000 |
| Search Engine Optimization | $2,000 | $1,800 |
| Total | $20,100 | $18,300 |
Now let’s compare this to the recruitment cost of building your own in house marketing team. These prices are rounded off estimates from multiple sources online, hence, they may be subject to change.
| Specialist | Approximate Salary (Yearly) |
| Data Analyst | $67,000 |
| Social Media Manager | $55,000 |
| Marketing Manager | $81,000 |
| Graphic Designer | $48,000 |
| Digital Marketing Manager | $73,000 |
| Copywriter | $80,000 |
| Web Designer | $57,000 |
| Total | $461,000 |
The interesting part of all this, is when you choose to perform marketing activities on your own. If you’re planning to run a DIY method of marketing, you can set aside $4000 to $8000. You can designate about $4000 for paid social media promotions and about $8000 – $12000 on ad spend.
Now that you understand how much marketing can cost you, I’ve decided to help you understand the popular tools, resources that are commonly used in the community. Two of my colleagues have written an in-depth blog post about these best startup tools that help growing businesses. Additionally you can also read up on this list of tools agency owners use to improve their work productivity.
Both of these articles are written by my colleagues who explain tools that can help you through the ideation, marketing, finance and fundraising, CRM, and design & development tools.
I’ve now attempted to address some of the questions you may have had before you landed on this article. Scroll down to see the FAQ section.
Frequently Asked Questions
How long does it take to build an ecommerce website?
An ecommerce website can take a minimum of three months to build. In practical terms, the duration of the development process depends entirely on design complexity and functionality.
Which ecommerce platform is best to create an ecommerce website?
There’s no single answer to this question. Currently the most popular ecommerce platforms are WooCommerce, Magento, Drupal, Joomla, Opencart, Prestashop, and X-Cart.
How do I build an ecommerce website from scratch?
In order to build an ecommerce website from scratch, you’ll want to follow these simple steps:
– Decide the product you want to sell
– Choose whether you want to sell your products online or in a hybrid online/offline model.
– Register your business and the business domain name
– Choose a hosting provider
– Design your ecommerce store
– Set a payment gateway
– Install SSL Certificate for security and authenticity
– Select a shipping partner
How much does an ecommerce website cost to build and host?
As mentioned earlier, the cost of an ecommerce website depends on a lot of factors. The following numbers mentioned are subject to change based on time and location.
| Factors | Lower Limit Price ($) | Upper Limit Price ($) |
| Custom design | 5000 | 50000 |
| Theme | 100 | 200 |
| Web development | 30 | 150 |
| Domain name (One Time) | 10 | 20 |
| Hosting | 10 | 200+ |
| Apps and plug-ins | 100 | 300 |
| Marketing | 18300 | 20000 |
| Total | 23550 | 70870 |
Final Words
You’ve now covered most aspects of ecommerce website costs in 2020, as a user of Magento and WordPress. I’ve highlighted the different phases you’ll undergo when shifting your business online. I hope this article gives you a perspective on ecommerce website cost in the current global situation. We recommend being generous and spending when it is crucial for your business.
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Taha Qureshi
Taha is a tech enthusiast and he believes there’s no end to creativity. His roots are in content, digital marketing, and analytics. In the after-hours, he reads philosophy and teleports his game controller to its afterlife.
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Keep reading the article at The Official Cloudways Blog. The article was originally written by Taha Qureshi on 2020-05-09 07:41:34.
The article was hand-picked and curated for you by the Editorial Team of WP Archives.