In this article, I will give a brief overview of how the system is set up to collect your money. I will then discuss briefly what to look for in evaluating payment gateways. As usual, I will keep this basic and understandable just as I do with all of my articles.

The Basics – How Funds are Collected

Ecommerce simply refers to the practice of shopping online. From the site owner’s perspective, it entails collecting funds from sales transactions on their website and depositing that money into the bank. In order to collect funds, you need to have a merchant account and a payment gateway (discussed below). Basically, when a person enters their credit card number on a website, the card number and buyer information is sent to a payment gateway. This is done securely. The payment gateway will interface with a payment processor to check availability of funds as well as any other criteria set for accepting transactions. If the funds are available, the payment processor will then deduct the funds.

The payment gateway will then report back a successful transaction to the merchant, at which point the merchant’s shopping cart system will respond by displaying a ‘Thank You’ type message to the buyer. Funds will sit until the transaction is settled, which means the funds are collected and deposited to your bank account. Until a transaction is settled, the transaction will not post to your bank account and the corresponding debit will not post to the buyer’s credit card account.

Merchant Accounts

A Merchant Account is a special type of account specifically for online retailers. They are designed to allow non-POS (point of sale) transactions using credit cards, or transactions where you don’t have the person’s credit card in hand. In other words, you don’t have a card swiper. A merchant account is not the same as a bank account. It acts as a go-between between your payment gateway and your bank account, accepting funds from credit cards which are then deposited into your bank.

A merchant account is a relationship based on trust between you and the issuing bank. The bank takes funds from the buyer’s account and deposits into your account. A payment processor takes care of checking for availability of funds and debiting from the credit card account. The bank issuing the merchant account is trusting that you will fulfill your end of the transaction by providing the product or service that the buyer purchased.

In case where this does not occur, the buyer can dispute the transaction. This puts the issuing bank on the line because they are then obligated to return the funds to the buyer’s card (a chargeback). Therefore, merchant providers are taking a risk in allowing a merchant to take credit cards under their name.

The organization providing your merchant account will do underwriting on the account when you apply to check your credit. If you have a history of too many chargebacks, you may be denied. In fact, too many chargebacks can result in you, as a merchant, being put on the Terminated Merchant File (also called The Match File). This is a blacklist which will effectively prevent you from ever receiving a merchant account again.

Payment Gateways
A payment gateway serves as the front end to your merchant account, allowing you to manage funds, transactions, and the like. It also serves as a connection between your website and your merchant account. It takes data submitted via your secure order forms and presents it to your processing bank. The processing bank then approves or declines the transaction and sends its response back to the payment gateway. The payment gateway then turns around and provides this data back to the merchant for appropriate handling of the transaction. A payment gateway, then, does not offer services such as merchant accounts or shopping carts, although some of the larger-known gateways do provide such options as value-added services.

Fraud prevention is a big one because, as stated above, too many fraudulent transactions will result in chargebacks which could end up putting you on the Match List and your merchant account closed. Some of the common fraud detection mechanisms are Address Verification (AVS) which compares the customer’s address with that on file with the issuing bank, CVV2 which makes use of the 3-digit security code on the credit card (4-digit on American Express cards).

Most gateways will provide instructions on how to interface with their servers from your web store. Most gateways offer two methods of integration.

One method is to have your site POST a form to the gateway’s server which is pre-populated with your customer’s information. At that point, the customer will provide the customer with the payment form which allows them to type in their credit card number in a secure environment. After processing occurs, the customer is then routed back to your website along with the results of the transaction. Your site again takes over the process.

This method is usually easier to set up for site owners and it also means the site owner does not need to purchase their own SSL certificate (allowing secure transactions on the site itself). The tradeoff is that you do need to send your customers off of your website for payment collection. Many gateways offer ways to make the payment form look like your website using customized headers and footers, but the fact remains that the visitors are leaving your website.

The second method is totally invisible to the customer. If the site owner has an SSL certificate, they can set up security on their own site. This means they can host the payment form themselves, totally customizing it to their website. When the customer submits payment, your site will securely and invisibly submit the information to the payment gateway.

The payment gateway will do the usual processing and then invisibly send the response back to the merchant’s website, allowing it to respond properly. From the customer’s perspective, they never left your website. And they never did. This type of setup requires an SSL certificate as well as access to the CURL library.

However, having a shopping cart installed on your website can actually boost sales by encouraging visitors to keep browsing after they have decided to make a purchase. They can easily select two or more products before signing out and a shopping cart system makes it easy to pay online for all the items in the cart at once.

There is no need to program your own cart program, in fact many web hosts that are aimed at providing service to ebusiness owners already have shopping carts available for you to use. All you need to provide is a merchant account and the prices for everything you want to sell! This is a very easy way to go about setting up an e-store, but you might want more flexibility than the standard host package gives you.

If you do a search for ecommerce or online shopping carts, you are bound to find hundreds of options. While it might look tempting to pick up a free shopping cart program, there are a few things to keep in mind before you choose one. You often get what you pay for, and that could mean a system that lets you down if you go with a free one.

Services such as PayPal often include free shopping carts with their accounts and tend to be fairly reliable, although they might not have as many features as you would like. What they lack in flexibility is made up for with ease of use, however, since you simply enter some basic data like product name and price and copy the HTML that is produced onto your site for an instant shopping cart button.

A paid shopping cart may charge an initial set up fee or simply per transaction. These usually offer a wide array of options and you can fully customize them. You do need to have some form of merchant account in order to use a paid shopping cart, though. This allows you to connect your account to your new shopping cart and transactions will be done through the merchant account.

A shopping cart is something that you will most certainly need if you plan to make money online with more than just one product or service. You can start out with a free one, if you like, and upgrade later, but it is a necessary part of ebusiness.

If you are new to the concept of setting up your own Website Shopping Cart and managing your own transactions online this way, you’ll soon realize that the 1 Shopping Cart On-Line Automation Service may just be precisely what you are looking for. When you take a peek at the 1 Shopping Cart On-Line Automation Service, you’ll soon realize that you are looking at a system that can be thoroughly automated very quickly.

You’ll soon realize that there are a cornucopia of diverse shopping cart systems for purchase out there, but that many of them have a variety of diverse specifications that you mandate to adhere by, so take the time to make sure that you have ran into a piece of software that you are excited with. When you are thinking about making sure that you can use the software and make it function with your current set-up, you’ll soon realize that there are a many of diverse reasons to try this Best Ecommerce Shopping Cart for purchase out.

One of the great things about the 1 Shopping Cart Shopping Cart System is that they support unlimited products you can sell from your website. This becomes very valuable if you are selling digital downloads and ebooks. With this service you can sell ebooks or physical products which is a big plus. They also allow you to setup recurring payments for as many products or services as you need to. This is a great tool for aspiring affiliates to get them in the hang of using ecommerce for their payment needs.

When you are looking for perfect eCommerce Shopping Cart Solutions, always remember that you should keep in mind the actuality that there are a plethora of diverse decisions available to you, but that you will want the one that is the most user-friendly and the most useful to your website.

When you are considering what you need out of your Web Site Shopping Cart, weigh what your needs are. Do you mandate to weigh about people who want residual charges or do you want to think about sales and what you can do in order to make sure that you will receive the appropriate totals that you mandate. Don’t settle for less when it comes to how your customers pay you!

When you choose which Web Site Shopping Cart system, you want to make sure that you are protected from potential Data Loss. This can destroy your business right off the bat. Next you need to make sure it’s a secure system, like 1 Shopping Cart is. Also, make sure it’s a system with a very User-Friendly, robust Control Panel with all the bells and whistles you can’t find in many other places. And make sure your businesses long-term goals are met with this service. Everyone in business on the internet needs a shopping cart, just make sure the one you choose won’t leave your business you’ve worked so hard to build hanging.

You can use traditional methods to sell products such as direct mail, catalogs and advertising. However, if you have a great online presence, the entire world is your marketplace at a fraction of the cost of most traditional methods. To easily sell to this worldwide marketplace, you need a great shopping cart system.

Choosing a shopping cart system is perhaps the most important single decision you’ll make in your online marketing career.

This is because:

You’re stuck with the decision for a long time.

If you buy into a system that isn’t adequate, it can cost you money–big money- because it won’t maximize the amount of money spent by each visitor.

There are hundreds, maybe thousands, of off-the-shelf, free and alternative products out there vying for your money, time or both. And most of them are junk.

Don’t suffer like I did I learned the hard way. When I started on the Internet I couldn’t find a decent shopping cart program, so I took one that was highly recommended by my ISP (I now know the only reason they suggested it was because it made them the most money. They didn’t care if it was the best one for me or not). What a headache! The system wouldn’t do anything but take the order, but you had to have a PhD in computer science to work on it.

Here are 21 questions you absolutely, unfailingly must ask anyone trying to sell you a shopping cart. If you don’t hear positive answers to the majority of these questions, put your wallet back into your pocket and evaluate the next option. Don’t get stuck with a crappy shopping cart, even if they give it to you free.

If you have a poor shopping cart, get rid of it. I know that hurts, because you may have spent lots of time and money getting it going, but a bad one will cost you many thousands of dollars by waiting to replace it later rather than sooner.

Oh, and one more thing: if you hear the shopping cart programmer answer one of the questions below by saying, “Well, we could make it do that,” run away even faster, because you’re going to get stuck with a big custom programming bill with no guarantees that the cart is going to work the way you expected.

Every question below is very important when it comes to having a quality shopping cart system that gets more money out of the same number of visitors.

1. Will it calculate shipping and tax?

2. Does it handle specialized shipping like FedEx and UPS?

3. Will it automatically deliver hard goods and soft goods (e- books and other digital products) in the same transaction?

4. Does it offer customizable “Return to Shopping” pages without needing custom programming? This is important so you can send your customers to the most likely product they will buy next. Standard carts just send customers back to the main catalog, which forces them to search for related products. This is both irritating and time-consuming. Any delays in finding what they want could mean a lost sale, when they finally throw their hands up in disgust and move on to your competitor’s site.

5. Does it offer customizable “Thank You” pages based on what the customer just bought? These are pages where savvy marketers put affiliate links and other offers specifically related to the customer’s interests. When a customer clicks on one of these links and buys something from someone else, you get a commission.

6. Does it deliver receipt and confirmation e-mails automatically? The customer wants to know immediately that the order went through. If he or she is unsure, you are going to have to field many wasted e-mails and phone calls letting the customer know everything is OK.

7. Does it allow multiple order and dropship e-mails? In many cases, several different people in your organization and/or outside your organization need notice of an order. Again, you don’t want to have to do this manually.

8. Does it have a Web-based administration page so you can work on your cart from any computer that has Internet access?

9. Does it include encryption technology and a secure server? Many companies make a fortune by sucking you in with a cheap or free cart and then make money on selling you an overpriced secure server.

10. Does it deliver easy output to your accounting software? You want to be able to import and export data easily between the cart and whatever programs you have that need to share the customer and sales information.

11. Does it have its own associate/affiliate program or is it easily compatible with other major brands of associate software? An affiliate program lets other people promote and sell your products on their Web sites. You don’t pay them unless they sell something. When I tried to get an associate/affiliate program to work with my old cart, it cost me six months of down time and untold amounts of money lost because it wouldn’t work. The associate program people blamed the shopping cart people and vice versa. But ultimately I was left holding the bag.

12. Does it have integrated up-sell modules? The ability to offer more related products to customers making a purchase makes me a small fortune each month. We call it, “Do you want fries with that?” If you don’t have this ability, you are leaving many thousands of dollars on the table from people who would have spent more if your cart just gave them the chance.

13. Does it have an integrated sales and prospect database? In the old days I would have to print out orders and then retype them into ACT or some other database program. A good shopping cart system eliminates all this hassle and potential for error and gives you instant access to your sales reports and clients.

14. Does it have broadcast e-mail capability? Good shopping cart systems are able to manipulate your customer database instantly and send e-mails to any segment or sub-segment of your clients and handle unlimited e-mail magazines. Again, in the old days I would have to be genius enough to pick out segments of the database, export them to a file, import them into a mail program and then an hour later send the darn e-mail. Now this is all done in a few seconds.

15. Does it have mail merge capability? The e-mails sent are personalized to the recipients in any number of ways. Their names can be popped in to the subject line and in various portions of the body of the e-mail. You can merge “what they bought,” “when they bought,” “where they live” or just about anything that will make them feel the e-mail was just for them. Virtually all studies show that mail merge gets a much higher response than plain broadcast e-mail.

16. Can it handle coupons and other discounts? You can make a deal with Joe Blow that everyone coming from his Web site gets an automatic discount — either a percentage or dollar amount. This makes Joe look great to his visitors and makes more sales for you. Here’s a secret: Joe is your affiliate and makes money on the sale too, so he’s got a great incentive to keep your discounts and coupons in front of his visitors. Good shopping cart systems can automate all of this and also handle any quantity discounts you offer.

17. Can it work for multiple Web sites with no extra fees? When I first started I had to get a separate (and expensive) license for each site and a separate merchant account too. Not only was this a great deal of expense, the hassle with installation every time you wanted a new site to go up was enormous. Modern carts can sell bras on one site and bibles on another, and no one knows the difference. The carts run on their own servers so there is no expensive installation and set-up is immediate.

18. Does it have unlimited and fully integrated “sequential” autoresponders? This is one of the most powerful features when it comes to Internet marketing. This feature follows up automatically over and over again to your clients and prospects to provide them customer care and to sell them more products and services. You can even provide free or paid e-mail courses, and each part of the course is delivered automatically.

19. Does it have ad tracking tied into actual sales? Simple ad tracking can be had all over the ‘Net, but it is pretty much worthless unless it is tied to actual sales. This is called the “conversion ratio.” Your cart system should be able to tell you how many people clicked on a particular promotion and how many people bought. This is the only way you can determine if an ad paid off. Good carts will also automatically split test one of your sales pages against another and tell you which page sells more. You keep the page that sells more and get rid of the page that sells less.

20. Does it have a pop-up box builder? Even though many people hate popup boxes, they work. I use them judiciously to make all kinds of offers, and I have the sales figures to prove they get more money out of the same number of people. If you know how to use them properly, no one gets upset.

21. Does it have a printable off-line order form? Believe it or not, many people are still afraid to put their credit card numbers into a Web site. I still get lots of fax orders and phone orders. If you want to maximize your sales, your cart must take these kinds of orders easily.

22. Does it provide free training? You’ll need training in both the basic set up of using your shopping cart and determining your online sales strategy, so that you maximize the amount of money spent by each customer.

You may not understand what all the above questions mean right now, but I can assure you they are important in putting more money into your bank account. If you want to know even more about this subject, you can download a free e-book, How to Pick a Shopping Cart System That Makes You Money at www.public- speaking.org/ebook.htm.

What shopping cart system do I use? I have my own private label called www.KickStartCart.com.

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First, you will want to decide the type of products that you are going to offer. Will it be a variety of products, or are you aiming towards a niche crowd? This will determine what kind of money you will have to put up front in order to get started. If you pay too much for the items that you are trying to sell, you will never be able to make a profit from your ecommerce plan.

Next, you will need to choose a domain name for your ecommerce business. Make sure that the name is easy to remember for your customers, so make it short and sweet. This will allow people to remember the website without having to write it down as well as having an easy way to share it with others.

The next step is key to drawing in and retaining customers. You will want to have a professional, easy to use website that will guide customers through the buying process instead of confusing them. Professional design is key because many buyers will not trust a web page that was just slapped together in an evening.

In order to have the ability to collect money for your products, you will also need to set up a shopping cart system on your website. This will let people pay you through PayPal, Google Checkout or many other companies that you can choose from. Your particular situation will determine what type of payment methods you should accept.

There are many shopping cart systems available from open source to commercial software. The main advantage of open source software is that most of the top products have a good support system and community who are always helpful and best of all they have been tried and tested many times before. A shopping cart system like osCommerce is a good place to start!

You will find some web hosting companies have this shopping cart system and others like it ready to install straight from their hosting control panel. Falcoda Internet is one such company and their Ecommerce web hosting plan is a great solutions!

The Internet has greatly changed the way that people shop and therefore produced new priorities. Of the things that will result in customers leaving an online site, it is a shopping cart that is slow to process or that stalls in the middle of a transaction. This leaves a customer uneasy and wondering if his or her personal payment information is safe.

Site owners will commonly spend hours making sure their website offers a wide array of merchandise at reasonable prices but then wonder why they are still not seeing sales. After a long line of time-consuming strategies that end up not working, many find they simply need a better ecommerce shopping cart. After all, it is fairly difficult to generate sales if sales cannot be made or completed in the first place.

A faulty shopping cart system should always be upgraded as soon as possible. Once a site gets a reputation for a slow or aggravating payment process, it can be fairly difficult to lure customers back in. For those who enjoy online shopping, everything rests on a convenient and safe buying experience.

Those who plan to sell merchandise from their website will need a program that is not only compatible with website programming but the right size for the job. A site that sells only one or two items does not necessarily need a program with lots of bells and whistles. In the same vein, a site that sells several pages worth of merchandise will need something that can handle many tasks at once.

As many have come to find, there is a wide range of software available. Some are very simple and others tally not only sales but tax, discounts and shipping and handling to different locations based on zip code. For individuals selling certain types of merchandise, it is very necessary to have these particular features.

The average online shopper is likely to use a credit card for their purchase. As identity theft is a large problem these days, it is important to be able to offer a checkout process that is encoded. Some shopping cart programs have their own security features that alert credit card companies when a purchase seems to be suspicious.

Having security features is especially important for websites selling high dollar items. This helps to keep inventory loss to a minimum. In addition, a website that is able to stop an unauthorized charge before it happens will result in a good reputation; something that could mean even more traffic and sales in the long run.

Those with websites do not have to be intimidated by the technical aspects of this type of software. A good shopping cart software program is easy to install and requires no in depth knowledge or training. They can be customized by the site owner and allow payment types such as credit card or even electronic check.

Once a reliable ecommerce shopping cart is put into place, individuals can provide their customers with a safe and convenient shopping experience. This, in turn, means more sales for the website owner. It is also what makes the investment of having and running a website full of great merchandise worthwhile.

Having a shopping cart system that doesn’t work well or is limited in functionality is often a mistake new websites make. They lavish lots of time and money on making the site appealing, showing off their products or services in the best possible light and even adding cool flash add-ons and other extras, but cut corners on the shopping cart because they see it as a mundane, boring feature that is strictly utilitarian. The problem that arises from that attitude is that shoppers can quickly lose their enthusiasm for purchasing a product or products if they become frustrated when going through the online checkout.

Online shopping carts should be customer friendly. People make mistakes; it’s a fact of life. If your website’s online shopping cart system is well-designed, it will allow for errors by having links on each page for going back and making corrections or enabling the shopper to change his mind on one item without losing his entire order in the process.

Internet shopping is only as convenient as the payment options for most people. If a retail website offers wonderful gifts, clothing or furniture but doesn’t accept credit cards, it will lose a hefty proportion of its customers. Conversely, if a variety of options such as major credit cards, PayPal and e-checks are available; shoppers will be more inclined to make purchases.

Shopping carts must also have back end flexibility. Of course, offering lots of different options and services through your online shopping cart system is great for your customers, but if it isn’t easy to use and adapt to your own company’s needs from the back end as well, it won’t help. If you have a flexible, intuitive back end design, however, you’ll find that a more complex shopping cart system can actually make your work easier.

There are many companies today who offer custom designed online shopping carts as well as companies that offer several different software packages that you can tailor to fit your specific needs at a reasonable cost. Using these specialists to help you implement an online shopping cart experience for your website can improve everything from your customer service to your bookkeeping, since you can use these systems for not only placing orders, but for tracking inventory and assessing sales trends.

When researching online shopping cart options for your website, ask some serious questions about what the provider can offer you. Considerations on whether the software package will include the source code so that you can customize your online shopping cart as your needs change should be an option. Find out if there is technical support available if and when you need it. Research what types of payment options can be set up with the shopping cart program. And learn if the system is a dynamic one that can evolve and change, as shopper’s needs change.

Be sure when you’re looking for the right online shopping cart service or package that you really know what you’ll need. Whether you offer customized gifts or require drop-down menus for color, size and style choices, your decision will be based on your needs. Also, find out what the return policies are for the particular product you are interested in. Knowing as much as possible about what you want will ensure that you don’t fall short when you invest in your website’s online shopping cart system.