From long-existing brands to newly opened local boutiques — it seems like every business is online these days.
In 2023, nearly 14 million ecommerce websites existed in the U.S. alone.
In this era of ecommerce, setting up an online boutique is a great idea to start a new business or expand an existing one. However, to make it profitable, you need to have a well-planned strategy and avoid making common mistakes that can cost your business.
In this article, we’ll look closely at what an online boutique is, uncover the secrets of successful boutiques, and teach you how to start an online boutique safely and quickly in 2023.
Why start an online boutique in 2023?
An online boutique is an ecommerce business that sells a curated selection of clothing, accessories, or other products. These stores typically have a unique style or theme and may focus on a specific niche or target market.
Opening an online boutique helps you:
- Reach a global customer base.
- Potentially gain high profits by selling popular products.
- Operate a remote business with minimal financial risk by keeping limited inventory.
- Have the freedom to manage it as a full-time business or a side hustle.
Due to these benefits, many people want to create this type of ecommerce business. But before you look for strategies or estimate how much it costs to start an online boutique, let’s see if starting this business is actually profitable in 2023.
Is owning an online boutique profitable?
As with any business, the profitability of an online boutique will depend on many factors. This includes the market demand for the products, your ability to source and sell products profitably, and your marketing and business skills.
It’s important to carefully research and make a business plan for your online clothing store before launching. You also need to be prepared for the challenges and risks of starting a new venture.
In general, starting an online boutique may be profitable for the coming years. Statista projects the U.S. clothing, footwear, and accessories ecommerce market to increase to $305.2 billion by 2027.
Apart from this, an online boutique is more profitable than an offline business due to:
- Minimal operational costs: You can avoid many overhead costs, such as rent and maintenance associated with physical stores.
- Wide customer base: An online boutique earns business from customers around the globe, unlike a brick-and-mortar store.
- Round-the-clock availability: Customers can place orders from your online boutique whenever they want without waiting for the shop to open.
On average, online boutique owners earn around $3,479 per month. Moreover, starting an online boutique doesn’t require a lot of investment. If you consider how much it costs to start an online boutique, you’ll find the business quite profitable.
However, you first need to consider certain factors to learn how to start an online boutique and make good revenue.
Factors to consider when starting an online boutique
It’s natural to want to know how to start an online clothing boutique when you’re just venturing into an ecommerce fashion business. However, before you open a boutique, there are a few important things to know.
Every business involves considerable and unpredictable risks. However, if opening an online boutique is your first business, you should know the risks involved beforehand to limit unforeseen losses.
Some of the risk factors associated with an online boutique business include:
- Competition: The online retail market is highly competitive, making it difficult for new businesses to stand out and attract customers.
- Shipping and fulfillment: The cost and logistics of shipping products to customers can be complex and expensive.
- Payment processing: The use of third-party payment gateways may not always be secure if they aren’t verified, increasing the risk of cyberattacks and payment fraud.
There are several potential legal factors to consider when setting up an online boutique, such as:
- Licenses: A business license or government registration is a must to run a successful online business. Look for information on how to start an online boutique legally to know more about the required licenses.
- Sales tax: Online businesses also need to pay a sales tax on the goods they sell.
- Consumer protection: Online businesses need to abide by consumer protection laws, which involve rules for advertising, return of goods, and customer privacy.
Apart from these, there are other factors, such as consumer behavior and psychology, that determine the success of your online boutique.
You can learn more about these factors and other tips for running an online business on educational platforms like Udemy and Coursera.
You can also search for books on platforms like Amazon to learn how to start an online boutique legally.
Tips and tricks for launching your online boutique
While business courses and books give you a basic understanding, you’ll require in-depth knowledge to make your online boutique stand out. Here’s a list of time-tested tips to guide you on how to start an online boutique.
Define your niche
Choosing the wrong niche can often negatively impact your business, leaving you feeling unsuccessful. That’s why it is essential to define your niche before deciding how to start an online clothing boutique to ensure the business runs successfully.
To choose the right niche, answer the following questions:
- Is there a demand? You can choose to sell a product that has a high demand and existing market. Or, you can introduce new products to customers and create a market with a first-mover advantage.
- How much can one sale bring? The transaction value of a product is the amount of money you earn from one transaction. While a low-cost, high-volume product may earn profits, try looking for niches that have high transactional values.
- What price category to aim for? The price category will define the type of customers your business will attract. If your target audience is middle class, choose a niche that allows you to price your products accordingly. If you want to sell to high-end customers, choose niches that are generally defined as expensive or luxurious.
Conduct extensive research
The next step in how to start an online boutique is finding out about your potential customers and competitors. Here are the steps for conducting competitor research.
Determine your target audience
It’s advisable not to sell to everyone but to find your target audience for more effective sales and promotions.
A target audience is a group of people who will likely be interested in a commercial offer, go through all stages of the sales funnel, and bring money to the company. All marketing activities, from advertising in social networks to offline communications, are aimed at this category.
Your target audience defines the sales and, in turn, the revenue of your online boutique business. That’s why it is essential to take time and contemplate the right audience for your ecommerce venture.
Before deciding your ideal customer base, take time to answer these questions:
- When are customers likely to seek your business out?
- How will they find your business?
- Why do they need your business?
Note: Your online store may have one or more target markets. Understanding your ideal customers influences the design of your website, how you present product descriptions and other information, and how you communicate on social networks.
What information about your target audience to collect
As a rule, marketers are interested in the following target audience characteristics:
- Socio-demographic: Gender, age, marital status, level of education, and income.
- Geographical: Region of residence and its climatic characteristics.
- Behavioral: Emotional effect of purchases, frequency of purchases, and the need for purchases.
- Psychographic: Motivation for purchases, life orientation, and reaction to innovation.
Where to find information about your target audience
Sources of information about the target audience can be your client base, competitors, and open sources. Communication with your target audience is the most important source of information. You can gather their feedback through:
- Interviews (in person, by phone, and via social networks and email).
- Online surveys.
- Feedback forms on your website.
- Customer support services.
You can also get to know your audience with the help of analytics platforms like Google Trends or Google Analytics. You also can look at reviews of your direct competitors, discussions in relevant social networks, and forums.
Сommon mistakes when segmenting your target audience
Audience segmentation is often done incorrectly. Marketers make the following common mistakes:
- Not working with the database: For example, if you don’t exclude inactive users from statistics, you can get the wrong results. And you could make false conclusions based on bad data.
- Lack of testing: It isn’t enough to draw up a portrait of the target audience and think through the mechanics of interaction with clients. It’s also necessary to monitor the reaction of customers to your product promotions and other communications.
- Not updating segmentation: Data becomes outdated. Therefore, you need to revisit your audience analysis and segmentation on a regular basis to ensure accuracy.
Choose the right products for your boutique
Perhaps one of the most important advantages of online boutiques is the unique range of goods they offer that shoppers can’t find in a regular physical store.
Often, the success of such a business will depend on how well you choose products. However, along with a well-curated product catalog, you also need to maintain inventory to satisfy customer demands.
There are two ways to manage inventory in an online boutique business:
- Stocking products: In this method, you preorder certain quantities of each product and stock them in warehouses. When customers place an order, you ship products from the existing inventory.
While this helps in the quick fulfillment of products, excess inventory can pose a risk for online business owners, especially if large quantities of products remain unsold. To overcome this risk, you can opt for another method called dropshipping.
- Dropshipping: In this inventory management method, you take customer orders through your online boutique and fulfill them directly through a supplier. Instead of you keeping an existing inventory, the supplier ships the order directly to the customer, while you keep a profit for each sale.
As dropshipping doesn’t involve maintaining inventory, it’s a less risky option and is ideal for online boutique owners who are just starting out. However, due to direct shipping, you won’t be able to ensure the quality of products during each sale.
Regardless of the inventory management method you choose, you need a supplier to stock goods for your boutique. Follow the below tips to find the right supplier for your business.
- Search engines: Type the name of the product you want into the Google search box and add the word “wholesale” or “supplier.” Look through the results and find ideal suppliers for your business. The best suppliers may not rank on the first search engine results page (SERP), so it’s essential to scroll through 10 or even 20 pages.
- Suppliers of competitors: If you’re excited about your competitor’s products, try to find out who supplies them. You can make a test purchase or even request quality certificates from competing businesses to find the suppliers of their products.
- Exhibitions, fairs, and conferences: Industry conferences bring together professionals to find partners and see what the competition has accomplished. At these events, everyone is open to conversation and will gladly answer your questions about supplies and product ranges, give you a look at product samples, and maybe even give you souvenirs or samples.
Once you’ve found potential suppliers, write or call the companies to ask for a price list and delivery terms. Choose a few options, and pay attention to prices and minimum purchase volume.
Getting products from a manufacturer will be cheaper, but the minimum order may be too big for you. In this case, you can use intermediaries.
Choose business and domain names that reflect your brand
Your online boutique’s name creates your customers’ first impression of your business. That’s why it’s essential to choose an attractive business name that resonates with the niche of your website.
As an online boutique is an ecommerce website, the business name will also likely be the domain name. However, while business names can be repeated (though it isn’t advisable), the domain name needs to be unique.
To ensure this, make a list of several related options and check if the domain name is available.
You can use the domain registration and search platform from Nexcess to check for available names. Visit the link and type the desired business name to check its availability.
Once you find a name that’s available, you can claim it by paying a reasonable price every year. You can also choose a unique extension like .boutique or .shop if .com is unavailable.
Choose the right ecommerce platform for your boutique
Nowadays, you don’t need to be a programmer, developer, or designer to create a website when opening an online boutique. All this you can do yourself using dedicated online platforms that help you build websites with a few clicks.
Each platform offers unique capabilities, and choosing the right one depends on your business requirements. Here are a few factors to consider when choosing an ecommerce platform for your online boutique.
- Responsiveness: Several customers now shop on both mobile phones and computers. A responsive platform will easily adapt your website to all devices, enhancing the buyer’s experience.
- Security: Your online boutique business stores the personal information of both the business owners and your customers. It’s essential for the platform to be secure to prevent data stealing or ransomware.
- Integrations: While ecommerce platforms may offer a host of features, they should also allow integrations with different tools in case you want to expand functionality.
- Search engine optimization (SEO): The platform should support SEO features such as meta descriptions and title tags to boost organic traffic for your online boutique.
Considering these factors, there are two popular ecommerce platform options you can consider: Shopify and WooCommerce.
Shopify is a user-friendly ecommerce store platform that helps you quickly create basic websites. With a few questions and selections, you can build an ecommerce website.
If you want to know how to start an online boutique with no money, then Shopify’s free trial might be the answer.
However, it’s important to note that the platform’s themes and pre-built templates limit your customization options. You’ll likely be selecting from templates that are used by thousands of other websites.
So, it may not be the best option to get your audience’s attention.
If you want your online boutique to stand out among competitors, choose a more customizable option, like WooCommerce.
WooCommerce offers various personalization options that help you design a unique, attention-grabbing online boutique that is tailored to your style and brand. The platform gives you more control over your website with multiple add-ons and integrations.
Plus it’s open source, meaning you own your site and data, and you’re not tied down to a single proprietary platform.
With WooCommerce, you can easily design your website, regardless of your budget or technical knowledge. Best of all, a fully managed WooCommerce host like Nexcess takes care of the day-to-day maintenance of your site, so you can focus on your business.
Market your online boutique
Once you’ve built an online boutique, it’s time to test your ideas through advertising. There are many methods to advertise your online store. But first, you need to choose where to “land” new customers.
You can make pages on relevant social media platforms and create a landing page on your website. These pages will help your customers browse through your products and decide whether to make a purchase.
After you make a landing page, here are the main ways to draw attention to your products online.
Influencer marketing is a marketing strategy where you collaborate with an influencer — a person with a high social media following who is able to influence the purchase decisions of others.
Influencer marketing helps you:
- Leverage a pre-established trusted relationship between the influencer and their followers.
- Target a specific customer segment that shares similar interests.
- Build brand authenticity and social proof.
As an online boutique, you can send sample products to fashion influencers to create review posts. Or you could ask influencers to choose some of their favorite products from your boutique to promote on their social media pages.
Social media marketing
Social media marketing involves using social platforms like Facebook, Twitter, and Instagram to market your products.
If you’re wondering how to start an online boutique with no money, then social media marketing is one of the best methods to promote your products, as it requires no investment.
With social media marketing, you can:
- Reach a global audience of over 4.59 billion social media users.
- Market to customers of various demographics using the same channels.
- Measure your marketing performance through easily accessible metrics, such as views and likes.
To use social media marketing, first choose the right platforms. For an online boutique, good options would be Instagram and Pinterest.
Then, choose your target audience and create a content strategy catering to their requirements. This includes adding images, making reels, and following viral content formats to increase your reach.
Apart from these organic reach methods, you can also use paid advertising spaces on social media platforms to promote your online boutique brand.
Email marketing is a targeted marketing strategy where you promote products by sending emails to interested individuals in your target audience. Though email marketing sounds old school, it’s one of the most effective marketing channels.
Email marketing lets you:
- Send personalized promotions to subscribers.
- Customize marketing efforts according to the buyer’s journey.
- Filter leads through subscriptions and gated content and concentrate marketing efforts accordingly.
Email marketing is an excellent option if you want to attract recurring orders or build a loyal customer base.
You can create a subscriber list by asking for email IDs on first purchases through your online boutique. Or you can offer exclusive incentives to customers who share their email during purchase.
The final word on starting an online boutique in 2023
An online boutique is a great way to start a profitable ecommerce business in 2023. You can curate unique product catalogs and cater to fashion-loving customers through your boutique website.
However, you’ll need a well-designed ecommerce website to promote your brand and display products for your customers. An attractive website helps you manage your boutique and create a positive customer experience.
Fully managed WooCommerce hosting from Nexcess enables you to create a beautiful online boutique that is tailored to your unique style and highly performant. You can choose from various themes or customize your own look to build an ecommerce website without the hassle.
Ready to start selling with your online boutique? Check out fully managed WooCommerce hosting plans from Nexcess to get started today.