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How Much Money Do Online Stores Make?

John HughesSeptember 19, 2022

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If you’re thinking of starting an online store, you’re probably wondering how much money you can expect to make. Unfortunately, there’s no easy answer to this question. Online stores can vary significantly in terms of their profitability. However, some general statistics can help you gauge whether or not your e-commerce site has a good chance of success.

In this article, we’ll look at the average revenue of online stores, using data from different sources. We’ll also discuss tips on increasing your chances of success as an online retailer. Let’s get started!

Online Stores and Profitability

Online stores come in all shapes and sizes, and their profitability can depend on various factors, including their target market and the platform they use. With that in mind, let’s look at the average revenue of e-commerce sites by niche and platform. 

Average Revenue by Niche

Your niche can have a big impact on how profitable your online store is. For example, if you sell products that are in high demand, chances are you’ll see a lot of sales and profit. On the other hand, if you target a very small or specific market, you might make fewer sales. 

On average, a consumer makes 19 online transactions per year. The top three e-commerce markets are China, the U.S., and the UK. Therefore, if your store is based in one of these countries, you’re more likely to be successful than if it were based elsewhere. However, it’s important to note that if your niche is profitable in one country, that doesn’t mean it will be elsewhere, with the reverse also being true.

In terms of niches themselves, the average order value from multi-brand retail was $124 in July 2022. The most lucrative market was jewelry, with the highest average order being $204. The least profitable one was home and furniture, with an average order of $63.

Let’s take a close look at some of the most popular niches in the e-commerce industry. 

Clothing and Fashion

Clothing is the most popular category of products sold online, accounting for around 59% of all e-commerce sales in the U.S. Online fashion stores can be very profitable, but they also tend to be very competitive:

Online fashion stores, and even big retailers like Nordstrom, can be very profitable, but they also tend to be very competitive.

In August 2022, Littledata surveyed 723 fashion stores. It discovered that the average revenue per customer was $103. Revenue per customer is a crucial metric for any e-commerce business, as it indicates how much each customer spends on average.

The data from Littledata also showed that earning $198 per customer would put you in the top 20%, with anything over $301 being in the top 10%. On the other end, the bottom 20% make under $60 per customer.

Travel

As part of its study, Littledata surveyed 2,895 stores in all and found that the average revenue per customer across all sectors was $109. The same data reveals that travel websites perform better than any other niche, with the average revenue per customer being $574:

Travel websites such as Protravel International perform better than any other niche, with the average revenue per customer being $574.

At the top end, $3,654 will see you into the top 10%, while under $85 puts you in the bottom 10. As you can see, owning a travel website is a very different ball game from fashion. The market is much less saturated and there are different ways to stand out from the crowd. 

For example, you could focus on a specific niche, such as luxury or budget travel. You could also cover a particular region or country.

Average Revenue by Platform

When you’re selling online, your e-commerce platform can have a big impact on your performance. The right platform will make it easy for customers to find and purchase your products, while the wrong one can hinder sales and lead to lost revenues. 

In order to maximize your profits, it is important to choose a platform that is well-suited to your business. There are a number of factors to consider, including the cost, the features it offers, and its compatibility with your existing website. You’ll also want to consider the ease of use and customer support options offered by the platform.

One of the most popular e-commerce platforms is Shopify. The average revenue per customer for Shopify-based websites is $89, with the top 10% making over $328:

Shopify is one of the most popular e-commerce platforms and Shopify-based websites see an average revenue per customer of $89.

Another popular option is WooCommerce, which is an e-commerce plugin for WordPress sites:

WooCommerce, a WordPress plugin, is also a popular e-commerce platform.

WooCommerce stores make an average revenue of $104 per customer. The top 10% make over $627 per customer on average. 

Meanwhile, sites hosted on Magento (now known as Adobe Commerce) make about $139 per customer:

Another e-commerce platform is Magento/Adobe Commerce, which makes more money per store but is expensive to set up and run.

Magento makes more money per store than any other platform, but it’s also the most expensive to set up and run. Shopify is the most popular platform and is much easier to use than Magento. Still, it comes with lower average order values. WooCommerce is an excellent middle ground, offering good average order values and a reasonable level of complexity. 

However, while WooCommerce makes more money for its users than Shopify, it’s important to remember that this is an open-source platform. You’ll have to pay for hosting, security, and other WordPress-related services.

How to Increase Your Chances of Success with an Online Store

If you’re thinking about starting an online store, there are a few tips to keep in mind. First, you’ll want to sell products that you’re passionate about. This will make it easier to stay motivated and focused.

You’ll also want to find a profitable niche. If you try to appeal to everyone, you might end up appealing to no one. By focusing on a specific market, you can become an expert in your niche, which can make it easier to attract customers.

Additionally, it’s important that you offer competitive prices. Price is an important factor in the buyer decision process:

It's always important to offer competitive prices no matter what e-commerce platform is hosting your site.

Another important factor is customer service. Since users are unable to physically see the products that they’re buying, you’ll want to make sure that they can easily reach out to you with any queries they may have. You can do this by providing different customer support channels. 

Finally, you’ll want to do everything possible to drive traffic to your site. A recent Statista survey shows that the leading traffic drivers are direct navigation, email marketing, and search engines. 

You can start by optimizing your product pages and using relevant keywords in your campaigns. You can also build an email list and start sending offers and updates to people’s inboxes. 

Conclusion

Your online store’s revenue will depend on various factors, including the niche and platform that you choose. If you can find a profitable market and build a good reputation, you’ll be in a good position to increase your revenue and grow your business. It’s also important that you provide excellent customer service and optimize your product pages. 

Do you have any questions about how much money online stores make? Let us know in the comments section below!

Image credit: ReaxionLab

adobe commerce brands Content Marketing e-commerce magento niche marketing online shopping online store platforms shopify website woocommerce

John Hughes

John is a blogging addict, WordPress fanatic, and a staff writer for WordCandy.

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Reader Interactions

  1. Del Matley on

    August 6, 2023 at 8:45 pm

    After you start this business does the company take orders and run the business for you or do run it yourself?

    Reply

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