Upon its 2008 launch, Magento was just another in a series of eCommerce platforms bidding to take over the then fledgling world of online shopping. Ten years later, Magento is the second biggest eCommerce platform that powers more than a quarter of a million websites worldwide. Their clients include successful brands like Burger King, Coca-Cola, Ford, Bulgari, and Harvey Nichols.

If you’re planning to launch an online store but have no experience with eCommerce, Magento might be just what you’re looking for. In this article, you’ll find the answers to some of the most common questions about the platform, its cost, and the services it offers.

What exactly is Magento?

Magento is an open-source content management system (CMS) written in PHP. In a way, it is very similar to WordPress. For one, both allow you to build websites, as well as to customize their appearance and functionality. They both have an intuitive user interface that allows you to easily manage your online content. Finally, both WordPress and Magento have very active online support communities.

The main difference between the two platforms is their primary purpose. Whereas WordPress is designed for blogs and websites, Magento is intended specifically for eCommerce. With Magento, you can create detailed product pages, build and manage product and user databases with extensive metadata, conduct online financial transactions, and promote your online store.

Sure, you can use plugins to upgrade your WordPress template to a fully functional eCommerce site, but you’d still be missing several key features that Magento offers. Furthermore, those third-party apps are nowhere near as secure as Magento. They thus might not be a good idea, seeing as you’ll be handling a lot of your clients’ sensitive personal information.

Ultimately, if your goal is to sell products online on your own terms, Magento is the platform for you.

What can you sell on Magento?

No matter what type of products you want to sell, you can do so through your Magento online store. Whether you’re selling organic fertilizers, artisan candles, or homemade cookies, you can easily add them to your store’s catalog. You can also sell digital goods like software, gift cards, and web magazines. As long as your store and products comply with Magento’s Terms of Service and/or Enterprise Edition Agreement, you should have no problem selling pretty much anything.

Keep in mind, however, that you must also adhere to local laws and regulations that define what you can and cannot sell online. For example, every state has different regulations regarding online firearm sales, so you must look at them closely before offering your products in individual states. Different rules also apply to online sales of alcohol, cutlery, and automotive parts. Similarly, the UK law forbids the sale of Blu-rays and DVDs rated R18 online or offline outside of licensed stores.

The bottom line is this: before you start selling products to customers in a certain area, you must make sure that said products are in compliance with all local laws and regulations. Otherwise, you may be permanently banned from selling your products there. What’s more, Magento could remove your ability to process financial transactions online, rendering you unable to monetize your products and services.

Which version of Magento should you use?

The summer of 2015 marked the official launch of Magento 2.0, a brand new version of the platform that offers many useful eCommerce and marketing features not available in the previous versions. Merchants who had previously built their web stores using Magento 1.x could either continue to run their stores with outdated software or upgrade to the new version, which would not only cost them money but also time and effort to migrate all their products, catalogs, and metadata to Magento 2.0.

If you’re a Magento newbie or at least haven’t used this eCommerce platform on your current website, you should definitely opt for Magento 2.0 – not only for the features it offers but because everyone will have to migrate sooner or later. For the time being, Magento will continue to offer online support to its 1.x users, but all feature and security updates will be exclusive to Magento 2.0.

Which eCommerce features does Magento offer?

Magento offers hundreds of features all online stores could benefit from. Rather than listing each individual feature, they can be organized into ten key categories:

1. Product data management – Manage all the products in your store’s catalog, either individually or in bulk.
2. Website management – Build and maintain a fully functional site with a dedicated web store.
3. Product organization – Organize your products by type, size, price, or some other key feature to allow users to browse your store more easily.
4. Search engine optimization – Optimize your product pages and descriptions with keywords and metadata.
5. Online marketing tools – Market your store, run promotions, and use your pages to convert more leads.
6. Processing and fulfillment tools – Use Magneto Order Management (OMS) to fulfill and manage orders from any computer or mobile device.
7. Shipping tools – With Magneto Shipping, you can also automate the shipping process by working with a network of carriers worldwide.
8. mCommerce tools – Your Magento store is fully optimized for mobile phones and mCommerce.
9. Customer database – Allow customers to register their profiles, rate and review your products, and sign up for your newsletter.
10. Advanced reporting – Access detailed reports on your total revenue, orders, shipments, and tax information. Track product statistics in real time to learn what your bestsellers are.

How much does Magento cost?

If you opt for the Community version, you can download the latest release from the Magento website and install it on your server completely free of charge. Obviously, you will have to pay for the hosting and domain out of your own pocket, but you won’t have to pay to use the Magento eCommerce software. The only downside is that you don’t get access to advanced features. While this is good for developers and tech-savvy merchants, businesses may benefit more from one of Magento’s paid tiers.

You can choose between Magento Go and Magento Enterprise. The former allows you to host your online store on Magento’s servers. You will have access to all the features, but you won’t be able to access the code. This is ideal for small and medium businesses that want to save on costs related to hosting a big online store with high amounts of traffic. Plans start at $15 a month and your total cost will depend on the size and server requirements of your store and the level of tech support you need.

Enterprise gives you access to all Magento features and allows you to license the code and use it on your own website. This is intended for large businesses and brands, so it’s no surprise that it costs considerably more than the Go tier. In this case, the price will vary based on your store’s annual gross revenue. Whether you’re making money or not, you will have to pay $22,000 per year for Magento Enterprise. The more your store earns, the higher the cost of Magento Enterprise will be.

For example, if you’re earning anywhere between $1 and $5 million, expect to pay about $32,000 per year. You will pay close to $50,000 a year if your store makes between $5 and $10 million, whereas anything between $10 and $25 million will increase your cost to $75,000.

The final word

Known for its flexibility and ease of use, Magento is one of the most popular eCommerce platforms in the world. Whether you’re selling a few signature products or thousands of products in different categories, Magento can help you take your business to the next level.

If you opt for the Community version of the software, you may need to work with an experienced developer to get everything going. However, as soon as you learn the ropes and make use of some of the available Magento store plugins, of which there are many, you’ll be able to sit back, relax, and watch your online business grow.