Ecommerce, which stands for “electronic commerce” is precisely analogous to a marketplace situated on the Internet. Ecommerce consists of the distribution, purchase, selling, marketing and servicing of products of services over computer networks such as the Internet. In the information technology industry, Ecommerce is seen as an electronic business application directed at commercial transactions. Ecommerce can involved electronic transfers of funds, e-marketing, online marketing, online processing of transactions, automated inventory management, and automated systems designed to collect data. The World Wide Web is commonly used at some point in the life cycle of any given ecommerce transaction, whether it be for purchase of a product or support of a service. According to a major research company, as of 2003, ecommerce generated 12.2 billion dollars worth of sales.

The emergence of ecommerce has lowered barriers to entry in selling many types of goods and services. This has allowed many small, home-based proprietors to enter the marketplace, when previously a lack of funds would have prevented them. Ecommerce enables any savvy entrepreneur with an Internet connection to set up a web page to sell goods and services. However, the array of options before you as you set out to offer your product to the world can be dizzying and confusing. So many different choices are laid out, each asking for your attention and proclaiming itself to be the best and most worthwhile. How is a prospective entrepreneur to choose between ecommerce services?

The biggest and most importance choice before you is where and how to host your web site. With most ecommerce traffic coming in through the web, your web site is the entry point for your customers. Without one, they will be unable to find you in the hustle and bustle of activity that is the Internet.

The myriad free site offers that can be found around the web may seem tempting. These sites offer free space, and often easy setup. However, while a free website might be acceptable for personal use, it is a poor choice for ecommerce hosting. Many free sites do not permit commerce in their terms of services. Those sites that will allow you to conduct business are often supported by popup or banner advertisements that can draw traffic away from your page and annoy your customers. Popup ads provide an immediate distraction for your prospective customers when they should be focusing on the products and services you offer.

Free web hosts also give credence to the old saying: “You get what you pay for.” Subscribers to a free ecommerce hosting service are at the bottom of the chain of customer service. When it comes to bandwidth, server resources, and support for your site, you could find yourself suffering delays and unreliable service. Most free ecommerce site providers also reserve the right to remove sites at any time, for any reason. This means that your site could vanish in the night without notice. Because of these problems, ecommerce sites hosted with free web space providers are often considered unprofessional and may be passed without notice by your prospective customers.

Thankfully, more professional ecommerce solutions are available without much hassle or expense. A good web space provider can cost as little as ten dollars a month, and provide you with much more reliable service than a free host. When searching for an ecommerce provider, you have a choice of several options. The least expensive is called shared hosting. In this case, your site will be located on a server that provides service to many other personal and ecommerce web sites.

Dedicated server hosting is more expensive, but ensures that you and your ecommerce site receive their own server and thus the best uninterrupted service. Dedicated server hosting is available with and without managed customer support, depending on what you are willing to pay and the amount of knowledge you have about running a website. Dedicated server hosting is best for large ecommerce sites with a lot of traffic. For most small entrepreneurs, a shared hosting situation will suffice for their ecommerce solution.

Ecommerce sites using shared hosting may wish to invest in the purchase of a domain name, to simplify the process of bringing customers to their site. Domain names should ideally be short, memorable, and composed of real words. This will help your customers identify you and return again and again to your ecommerce site.