The eCommerce industry in Kenya has been experiencing significant growth in recent years due to the increasing number of internet users in the country.
Statistics show that there are over 17.86 million internet users in Kenya. Most people prefer to order their products and services from the comfort of their homes.
This tremendous growth has seen several businesses and entrepreneurs recognize the potential of online sales. Earn adopters of this idea, like Jumia, Kilimall, Jiji, and Carrefour, are the best examples.
However, not all businesses that invest in eCommerce succeed. So, the one common question that arises is, “How much does it cost to build a profitable eCommerce website in Kenya?”
This article explores factors that influence the cost of building a profitable eCommerce website and provides an overview of the cost breakdown.
Table of Contents
Factors Influencing eCommerce Website Costs
The key factors that influence the cost of an online store include the website type, design and development, content management system, features, hosting, and domain name. Let’s look at each of them:
1) Website Type
The type of eCommerce website you want to build will greatly impact the overall cost. There are three main types to consider when building a profitable eCommerce website:
- Simple Online Store: This type of website focuses on selling products or services directly to customers. It typically includes features like product listings, shopping carts, and payment gateways.
- Multi-vendor Marketplace: A multi-vendor marketplace allows multiple sellers to operate on a single platform. This type of website requires more complex functionality, such as seller profiles, inventory management, and commission tracking.
- Customized eCommerce Solutions: If your business has unique requirements or needs specific features, a custom eCommerce solution may be necessary. This option offers maximum flexibility but often comes with a higher price tag.
2) Design and Development
The design and development aspects of an eCommerce website are crucial in creating an engaging and user-friendly experience. Key considerations include:
- Website Design: A visually appealing and professional design is essential for attracting and retaining customers. Custom designs or pre-made templates can be used, with the latter being more cost-effective.
- Development Complexity: The complexity of the website’s functionality will impact the development cost. Features like advanced search options, personalized user experiences, and integration with third-party systems require more development time and expertise.
- Responsive Design: With the increasing use of mobile devices for online shopping, having a responsive design that adapts to different screen sizes is crucial. Responsive design ensures a seamless user experience across devices and can affect development costs.
3) Content Management System (CMS)
Content Management System (CMS) is a software used to manage and update your eCommerce website. Popular options include WordPress, Magento, and Shopify. Factors to consider include:
- Comparison of CMS Options: Each CMS has its strengths and weaknesses. WordPress is user-friendly and widely used, while Magento is known for its scalability and robust features. Shopify offers simplicity and ease of use.
- Impact on Development Costs: The choice of CMS can affect development costs. Some CMS platforms require more customization, while others offer out-of-the-box eCommerce features. Consider your business requirements and budget when selecting a CMS.
4) eCommerce Features
The specific features and functionalities you require for your eCommerce website will also influence the overall cost. The following are key features to consider:
- Payment Gateways: Integration with payment gateways is essential for processing online transactions. Some of the popular payment gateways in Kenya include Mpesa, Skrill, Payonner, pesapal, and 2Checkout. Each of these gateways has varying costs and transaction fees.
- Product Catalog and Management: The complexity and size of your product catalog will affect the development and maintenance costs. If you have a large inventory or need advanced product management features, the cost may increase.
- Shopping Cart FunctionalityThe shopping cart is a critical component of an eCommerce website. How do you want the shopping to look like? The complexity and customization required for your shopping cart will impact the cost.
- Security Features: eCommerce websites must prioritize security to protect customer data and prevent fraud. You will need additional costs to implement advanced SSL certificates, secure payment gateways, and robust data protection measures.
5) Hosting and Domain
You should choose a reliable web hosting provider to ensure that your eCommerce store is always available and perform optimally. Besides, you should select a memorable domain with a top-level domain.
The following are key factors and prices for your eCommerce website hosting and domain cost:
- Hosting Options
There are various hosting options available, including shared hosting, VPS hosting, and dedicated hosting. Shared hosting is the most cost-effective option, while dedicated hosting provides maximum control and performance. Shared hosting costs about Ksh 7,000 while dedicated hosting costs over Ksh 20,000 depending on your hosting provider.
- Domain Registration Costs
The cost of domain registration varies based on the domain extension and the domain registrar. I recommend going for a top-level domain (.com). However, choosing .co.ke is okay especially if you want to focus on Kenyan
Annual fees for domain registration typically range from Ksh. 1,000 to Ksh. 2,500.
- Domain Security
You should install an SSL certificate to secure sensitive customer information and build trust. The cost of installing an SSL certificate on a domain ranges from Ksh 1,900. SSL certificates can be purchased or obtained for free, depending on the hosting provider.
Cost Breakdown
Apart from the above obvious eCommerce requirements, you will also incur additional costs regarding development, design, maintenance and updates, and marketing. The following is the cost breakdown for each service:
a) Development Costs
The development costs for an eCommerce website can vary depending on factors such as the complexity of the project, the experience and expertise of the developer, and the type of service provider chosen. Consider the following:
- Hiring a Professional Web Developer
Hiring a professional web developer or agency can ensure high-quality results. However, this option comes with higher costs. A professional web designer in Kenya charges between Ksh. 50,000 to Ksh. 1,500,000 to create a fully functional eCommerce website.
- Freelancer vs. Agency Costs
Working with a freelancer may be more cost-effective, but it can also pose risks in terms of quality and reliability. A Kenyan freelancer charges approximately Ksh 50,000 to design an online store. Agencies often offer comprehensive services and can handle larger projects but may charge higher rates, typically Ksh 70,000 or higher.
- Hidden Development Expenses
It’s important to consider additional expenses when creating your eCommerce website in Kenya. Some of these include licensing fees for premium plugins, customizations, and ongoing support and maintenance.
b) Design Costs
Design deals with creating an attractive and user-friendly eCommerce website. Consider the following design-related costs:
- Graphic Design Elements
You will need custom graphics, logos, and branding elements to enhance the visual appeal of your eCommerce website. The cost of graphic design services can vary depending on the complexity and number of design elements required.
Typically a professional graphic designer in Kenya charges between Ksh 1,000 and Ksh 3,000 to design a logo. This also applies to creating website banners and posters.
- Customization and Branding
While it is sometimes part of the development process, some web designers will charge you separately. This service is crucial to align with your brand identity.
c) Maintenance and Updates
As with any other website, it is crucial to maintain and update your eCommerce website to enhance its performance and security. Consider ongoing maintenance costs, including:
- Ongoing Maintenance Expenses
Regular updates, bug fixes, security patches, and server maintenance are necessary for keeping your eCommerce website running smoothly. Budget for an estimated annual cost of Ksh. 8,000 to Ksh. 50,000 for maintenance services.
- Potential Future Upgrades
As your business grows, you may need to invest in additional features, scalability, or redesigns. Consider the potential for future upgrades and allocate a budget accordingly.
d) Marketing and SEO
You will need a team or hire a professional to conduct marketing and Search Engine Optimization (SEO) to drive traffic and increase conversions. There are two categories of marketing costs:
- Initial Marketing Costs
This is the initial cost that will arise from promoting your eCommerce website through paid advertising, social media marketing, and influencer collaborations.
You should budget about Ksh 50,000 if you want your eCommerce website to be visible and profitable.
- Long-term SEO Strategy
You will need to implement a long-term SEO strategy to improve search engine rankings and organic traffic. Budget for monthly expenses ranging from Ksh. 35,000 to Ksh. 150,000 for SEO services.
Summary of Profitable eCommerce Website Cost
The following table shows a summary of creating a profitable eCommerce website in Kenya.
| eCommerce Service | Approximate price (Ksh) |
| Web hosting | 15,000 |
| Domain name | 2,000 |
| Design and branding | 70,000 |
| Maintenance and updates (monthly) | 10,000 |
| Marketing and SEO | 40,000 |
| Payment gateway | 10,000 |
| Domain security | 3,000 |
| Total Cost | 150,000 |
Note that the amount presented in the table above may vary depending on the professionals you will be hiring.
Tips for Cost-Effective eCommerce Website Development
It is important to minimize the overall cost of developing your eCommerce website. Consider the following tips to ensure that you attain optimal results without breaking the bank:
- Prioritize Features
Focus on the essential features that align with your business goals and budget. Avoid unnecessary complexity that may drive up costs. For instance, do add Payonner when you already have Skrill.
- Choosing the Right Development Team
Ensure you carefully evaluate the expertise and experience of potential web developers or agencies. Consider their portfolio, client reviews, and cost-effectiveness. Hiring a team with diverse skills will help you cut down unnecessary costs.
- Utilizing Open-Source Solutions
Open-source eCommerce platforms like WooCommerce and OpenCart offer cost-effective options with extensive customization capabilities.
- Use free resources whenever possible.
There are several free resources such as plugins, themes, and SEO tools that offer the same features and functionality as the premium ones. Don’t go for a paid one if you have a free one offering a similar service.
- Long-term Cost Considerations
Consider the long-term costs of maintenance, upgrades, and marketing when planning your eCommerce website budget. Ask your developer to disclose any hidden development costs
Wrapping Up
The digital landscape in Kenya is evolving rapidly and most people are increasingly preferring ordering products and services online. This trend is making starting an online store a lucrative business endeavor.
Building a profitable eCommerce website in Kenya involves various factors that influence the overall cost.
These include the type of website, design and development complexity, choice of CMS, eCommerce features, hosting and domain, and ongoing maintenance.
You should understand these factors and implement cost-effective strategies to create a successful eCommerce website within your budget.
Ensure you prioritize key features, choose the right development team, utilize open-source software, and address any hidden costs. prioritize your business goals and consider long-term scalability when making decisions.
With the right development team and a well-executed strategy, you can create a profitable eCommerce website that can become a valuable asset for your business in the digital landscape of Kenya.
If you have any concerns, comments, or questions, please comment below or reach us today.
