By 2028, the e-commerce market is expected to reach an impressive $5.02 trillion, with a strong compound annual growth rate (CAGR) of 10.15%. This growth highlights the growing significance of e-commerce platforms in the global retail industry, driven by emerging technologies like voice search, AR, and AI.

But the key question remains: What is the cost of developing an e-commerce website?

In this article, we will explore e-commerce development and provide a comprehensive overview of the costs involved in building an e-commerce website in 2024.

Platform Complexity

The complexity of an e-commerce platform depends on its user roles, functions, features, and how they interconnect within the website. The smaller and less complex the application, the less time and money will be required for its development. Let's take a closer look:

Small E-commerce Websites

Small e-commerce websites are simple and typically come with essential features such as a product catalog, product detail pages, user reviews, ratings, and a straightforward checkout process. They are designed for a relatively small number of users and are not optimized for handling large volumes of simultaneous requests. For these smaller websites, using website builders like Webflow or basic plans on Shopify is often both cost-effective and efficient. For example, a small microbusiness that sells handmade crafts could benefit from this approach.

Midsize E-commerce Websites

Midsize e-commerce websites include all the features of a simple site but also offer additional functionalities such as advanced search and filtering options, personal accounts, custom promotion features, and multiple payment gateways. An example of an e-commerce site in this category is Mebelmarket. These websites typically serve around 100,000 monthly visitors, providing an improved user experience that often requires a higher investment. They are usually developed using custom development and CMS (Content Management System).

Complex E-commerce Websites

These are large e-commerce websites that require extensive server capacities and the implementation of complex features, like AI-driven recommendations, AR for product visualization, multi-language support, real-time inventory tracking, dynamic pricing, and detailed analytics and reporting. Examples of such platforms include major marketplaces like eBay or Amazon, where individual sellers can showcase their products. These platforms handle hundreds of thousands of visitors monthly and require custom development due to their complexity and the extensive range of technologies involved.

Please keep in mind that all numbers and functionalities mentioned are approximate and may vary depending on specific project requirements.

Custom development

Custom development is well-suited for midsize to enterprise-level clients who require a tailored solution that goes beyond what off-the-shelf CMS platforms can offer. This approach is perfect when a business operates in a niche that doesn't align with standard CMS options or requires a highly specialized website. Furthermore, custom development is the optimal choice for businesses with unique ideas that demand a tailored solution built from scratch.

Benefits

• High Interaction Speed: Custom-built websites are optimized for performance, resulting in faster load times and improved user experiences.
• Maximum Customization: With custom development, you have full control over the website, allowing you to extensively customize it to meet your specific needs. You can also design an architecture that aligns with your company's goals and vision, ensuring scalability and supporting long-term growth.
• SEO Optimization: Custom sites can be finely tuned for search engine optimization, enhancing visibility and ranking in search results.
• No Subscription Fees: Unlike CMS-based solutions, custom websites typically do not involve ongoing monthly fees.
• Enhanced Security: Custom solutions can be designed with advanced security measures, potentially making them more secure compared to standard platforms.
• Ownership and Independence: A custom website gives you full ownership and control of your digital assets. This means your site is not bound by the policies of a CMS provider, allowing you the freedom to manage and customize it according to your specific needs.

However, custom development also has its drawbacks:

• Development Time: Building a custom website takes more time, which can delay the launch of your online presence.
• Higher Budget: Due to the complexity and tailored nature of the development, custom websites generally come with a higher price tag.
• Expertise Requirement: The support and development of complex custom solutions require skilled developers to manage and maintain the site effectively, resulting in a higher entry barrier compared to using CMS platforms.

Technology stack for e-commerce development

Another crucial aspect of e-commerce development is selecting the right technology stack. This involves choosing appropriate front-end and back-end technologies that meet the needs of the website and its expected performance requirements. A well-selected technology stack ensures scalability, component reusability, and the ability to handle high volumes of traffic.

It is also important to consider various integrations that connect e-commerce platforms with external services and systems, such as payment gateways for transactions, logistics systems for shipping, and marketing tools for tracking and campaigns. They also link with resource management systems for inventory and order handling, ensuring smooth and efficient operations.

Let’s break down the components of an e-commerce platform and estimate the time and effort involved in its development.

Key Components of Custom Development

To determine how much it costs to build an e-commerce website, you need to outline the functionalities you want to include in your solution. Here are the key components that influence the cost of custom development:

User Account Features

User account features let customers create personal profiles, manage their information, and access customized options to simplify their shopping experience.

• Personal Account: This feature allows users to create profiles where they can store personal information, payment details, and wishlists. A personal account fosters customer loyalty by making future purchases more convenient.
• Product-Related Features: Options like product comparison tools and suggestions for "similar items" help users make informed purchasing decisions.
• Payments: You can choose from various payment options, including traditional methods such as credit and debit cards, digital wallets (e.g., Apple Pay, Google Pay), and more modern solutions like buy now, pay later services (e.g., Afterpay, Klarna). Additionally, cryptocurrency payments are becoming more popular as an alternative.

Marketing and Communication Features

• Marketing Features: This includes promotional badges (like “most popular”), discount systems, cashback offers, and affiliate programs designed to attract customers and boost sales.
• Emails & SMS: Integration with communication services like Mailchimp and Twilio allows for effective outreach, such as sending order confirmations, promotional offers, and personalized recommendations.
• Chat/Online Help: Real-time chat features provide immediate customer support, addressing inquiries and resolving issues as they arise, which enhances overall customer satisfaction.
• Localization: Supporting multiple languages and regional settings ensures your site is accessible to a broader audience, catering to diverse customer preferences and enhancing their shopping experience.
• Analytics: Tools like Hotjar and Google Analytics help you understand how customers interact with your site so you can keep improving their experience.

Integrations and Technical Considerations

Effective integrations and technical elements are vital for a complete e-commerce solution:

• ERP Integration: Connecting the e-commerce platform with an Enterprise Resource Planning (ERP) system streamlines inventory management and analytics, enhancing operational efficiency.
• CRM Integration: Using a Customer Relationship Management (CRM) system allows personalized user and purchase management, catering to various business models (such as B2B, B2C, or C2C). AI is also becoming a key part of modern CRM tools. This research by GoodFirms covers how it’s being used to improve customer interactions.
• SEO Optimization: Implementing technical SEO strategies enhances the website’s visibility on search engines, attracting more organic traffic and potential customers.
• Server Solutions: Using a Content Delivery Network (CDN) and other server technologies ensures fast and reliable site performance, even during peak traffic times.
• Security Measures: Implementation of robust security protocols, including SSL certificates and services like Cloudflare, safeguards user data and fosters trust with customers, which is crucial in e-commerce.

These components outline the diverse functionalities and integrations necessary for a comprehensive e-commerce solution, each contributing to the overall development cost.

How Much Does It Cost to Build an E-commerce Website: The Final Price

The total cost for developing a basic midsize e-commerce website typically falls between $45,000 and $50,000. Keep in mind that this is just a rough estimate to give you a general idea of what to expect. The purpose of this estimate is to provide an overview of the potential costs. However, the final price can change depending on your specific requirements and the features you'd like to include. More advanced functionality will naturally increase the cost.

It's also important to remember that designers and developers aren’t the only specialists involved in building an e-commerce website. A complete team of specialists is needed to ensure the project runs smoothly from start to finish. We determine the percentage allocation for these roles based on our experience and industry benchmarks to ensure the best distribution of resources and project efficiency. In our estimate, we've included:

QA Specialist: Their role is to test the website at different stages of development, ensuring it functions as expected and is free of bugs before it goes live.

Project Manager (PM): The PM handles all communication between you and the development team, ensuring that tasks are completed on time and that everyone stays on the same page throughout the project.

Team Lead: The team lead oversees the technical side, reviewing the code to ensure it meets quality standards and guiding the development team to ensure the best practices are followed.

Of course, you can choose different collaboration models, such as staff augmentation instead of full outsourcing. While this choice can offer more control and flexibility, it's important to bear in mind that it could potentially impact the overall quality of the end product. In general, building an e-commerce website requires a well-rounded team that includes:

• Front-end Developer
• Back-end Developer
• UI/UX Designer
• Business Analyst
• Project Manager (PM)
• QA Specialist
• Team Lead

Custom E-commerce Development vs. CMS Solutions Cost

Content Management Systems present a compelling alternative to custom development for building e-commerce websites. These platforms are particularly well-suited for small to midsize businesses seeking robust functionality without extensive customization needs. CMS solutions offer a versatile range of built-in features and plugins, making them an appealing choice for businesses aiming to launch their e-commerce sites quickly and efficiently.

CMS-based e-commerce solutions are well-suited for:

• Small Businesses and Startups: Companies with limited budgets and resources can benefit from the cost-effective and user-friendly nature of CMS platforms.
• Businesses Seeking Quick Time-to-Market: By using pre-built features and templates, CMS platforms allow businesses to get their e-commerce sites up and running more quickly.
• Businesses with Limited Technical Expertise: CMS platforms provide intuitive interfaces and pre-built templates, which make it easier for users with limited technical skills to manage their websites.

Nevertheless, it's crucial to consider the potential advantages and disadvantages of using a CMS platform. While CMS platforms can be cost-effective and user-friendly, they may not always offer the same level of customization and flexibility as a custom-built solution.

Benefits of CMS-Based E-commerce Development

• Cost-Effective: CMS platforms generally have lower initial costs compared to custom development. Many platforms offer free or affordable plans, with the option to access additional paid plugins and themes as needed.
• Quick Setup and Deployment: CMS platforms come with pre-designed templates and features, allowing businesses to swiftly set up their online stores without requiring extensive development time.
• Ease of Use: Designed with non-technical users in mind, CMS platforms offer intuitive interfaces and drag-and-drop functionality, making it easy to manage and update the website.

Disadvantages of CMS-Based E-commerce Development

• Limited Customization: While CMS platforms offer a range of plugins and themes, they may not provide the level of customization some businesses require. Customizing a CMS to meet specific needs can be challenging and may still require developer assistance.
• Performance Limitations: As businesses grow and traffic increases, CMS platforms may struggle to handle large volumes of data and concurrent users, potentially affecting site performance.
• Security Vulnerabilities: CMS platforms can be targets for hackers due to their popularity. Regular updates and security measures are essential to protect against vulnerabilities.
• Recurring Costs: While initial costs may be lower, businesses often incur ongoing expenses for premium plugins, themes, and hosting services.

Popular CMS Technologies

Several CMS platforms are widely used for e-commerce development, each with its strengths and use cases:

• Shopify: Known for its user-friendly interface and comprehensive e-commerce features, Shopify is a hosted CMS platform for small to midsize businesses. It offers various plans, including options for larger enterprises with Shopify Plus.
• WooCommerce: Built on WordPress, WooCommerce is a flexible plugin that can turn a WordPress site into a fully functional e-commerce store. It is customizable and benefits from the vast WordPress ecosystem.
• Magento: Magento offers a robust and scalable solution. It provides customization options and is suitable for businesses with complex requirements and higher budgets.

Cost Considerations for CMS-Based E-commerce Development

The cost of developing an e-commerce website using a CMS can vary based on the platform chosen and the specific requirements of the business. Below is a general overview of the costs associated with some popular CMS platforms:

• Initial Setup Costs: These include expenses for setting up the platform, buying a domain name, and any required initial plugins or themes.
• Monthly Fees: Many CMS platforms charge a monthly fee for hosting and extra services.
• Plugin/Theme Costs: Depending on the required functionality and aesthetics, businesses may need to invest in premium plugins and themes.
• Developer Rates: The cost of hiring developers for customization, maintenance, and support can vary depending on the platform and the complexity of the required features.

These costs can vary significantly based on the specific requirements of your e-commerce project, such as the level of customization, design complexity, and additional features needed.

Choice of Development Approach and Its Impact on Cost

Another aspect influencing the overall cost of e-commerce development is the chosen approach to building the website. The methodology, whether Agile or sprint-based, can significantly affect project efficiency and alignment with objectives. This method involves frequent planning sessions, retrospectives, and active involvement of project managers to maintain team focus and adaptability, ultimately leading to a more efficient and organized development process.

By breaking the project down into smaller, manageable sprints, development teams can better identify and address potential challenges, optimize resource allocation, and make real-time adjustments to the project scope or priorities. This flexibility allows for a more streamlined and cost-effective development journey, as compared to a more rigid, waterfall-based approach. Additionally, the collaborative nature of Agile methodologies encourages continuous feedback and user input, helping to minimize the risk of costly rework or feature creep. Overall, the adoption of an Agile development approach can significantly contribute to the overall cost-effectiveness of an e-commerce website project.

E-commerce Development with Stubbs

At Stubbs, we specialize in e-commerce development and have over five years of experience. Below, you'll find a few examples of our successful projects:

Mebelmarket

Mebelmarket is a leading furniture e-commerce platform that specializes in sofas, beds, and sleeping accessories. Designed for a Ukrainian company, the site features a minimalist and intuitive design that enhances the overall user experience.

Its key features include an easy-to-navigate catalog, customizable ordering options, and a wishlist for keeping track of preferred items. Additionally, the platform includes a promotions page for exclusive deals, a partners page highlighting reputable manufacturers, and an articles page providing insights on furniture and home decor.

• SEO Optimization: We implemented several strategies to improve SEO performance, including enhancing page speed and indexing. We focused on optimizing navigation elements, cart features, and breadcrumbs to ensure responsiveness on both desktop and mobile devices.
• Custom CRM: We created a custom CRM system that allows administrators to access orders, make notes, and set statuses. This system simplifies order management, making it easier for the team to handle customer interactions and track order progress.
• Dynamic Pricing: The platform uses dynamic pricing that adjusts according to the materials used and the size of the products. This flexible pricing model gives customers options that fit their preferences and budget, making their shopping experience better.

We are continuously exploring ways to further enhance site performance and user convenience. Detailed case study here.

Anabolic Pharmacist

Anabolic Pharmacist is an online platform that specializes in pharmaceutical products. The website offers a wide range of items with detailed descriptions and a straightforward checkout process. It accepts various payment methods, including cryptocurrency, and provides store credits, promotions, and an affiliate program. The admin panel allows easy product management, warehouses, discounts, and user accounts, making it a valuable tool for administrators.

• Custom ERP System: The platform uses a custom ERP system to manage stock across multiple warehouses. Depending on which warehouse the product ships from, the system adjusts shipping costs and delivery options.
• Affiliate Program: Affiliates have access to a personal dashboard where they can track their bonuses from referred customers. They can see statistics and use their earned bonuses to either withdraw them or buy products at a discount.
• Promotions: The platform includes features like product badges for promotions, such as “Buy 1, Get 1 Free.” These deals are clearly shown on product pages and during checkout to make it easy for customers to find offers.
   

Got a project in mind? At Stubbs, we're ready to bring your vision to life. With our proven expertise in e-commerce development, we create tailored solutions that deliver results. Whether you need a full-featured platform or a clean, user-friendly site, we have the experience to help your business succeed online.

Wrap-up

To summarize, the cost of developing an e-commerce website varies based on multiple factors such as website size and traffic, developer rates, and development approach. Small, midsize, and complex e-commerce websites each come with their own set of cost considerations and development requirements. It's important for businesses to carefully assess their needs and budget constraints before embarking on an e-commerce development project. Additionally, understanding the various development approaches, including custom development, can help businesses make informed decisions about the most suitable solution for their specific requirements.

Ultimately, while the cost of building an e-commerce website can be significant, it should be viewed as an investment in offering a seamless online shopping experience and driving business growth in the long term. By choosing the right development approach and considering the factors that influence e-commerce development cost, businesses can position themselves to capitalize on the immense opportunities presented by the booming e-commerce market.