What is WooCommerce? How It Works & Key Features

Key highlights

• Understand the core functionality of WooCommerce as a free, open-source plugin that powers over a third of eCommerce websites globally.
• Explore essential features like versatile product management, secure payment gateways, and customizable checkout processes to tailor your store.
• Learn the complete setup process, from selecting hosting and domains to installing the plugin and adding your first product.
• Uncover business benefits including cost-effectiveness, built-in SEO tools, and extensive community support for troubleshooting and growth.
• Determine if WooCommerce is the right fit for your business by evaluating its flexibility, scalability, and integration capabilities against your specific needs.

Did you know that WooCommerce powers over one-third of all online stores worldwide? If you’re wondering what is WooCommerce, you’re looking at one of the most powerful eCommerce solutions today. As a free WordPress plugin, it transforms any WordPress website into a fully functional online store.

In this comprehensive guide, you’ll discover how WooCommerce works and how to use WooCommerce to build your store. We’ll explore the essential features of WooCommerce, uncover the benefits of WooCommerce, and show you why millions of entrepreneurs choose this platform to power their online business.

What is WooCommerce? 

WooCommerce plugin is an extension designed to add functionality to websites built with WordPress, the free and open source content management system (CMS) platform that drives most websites worldwide. Since it is a plugin, it’s easy to get started with WooCommerce once you’ve started building your website. Bluehost offers WooCommerce hosting plans to make things even easier. 

This platform adds all the essential features of a basic online store to any WordPress website, with options for customizing the look and content of your store.  

The WooCommerce plugin works with virtually all the free and premium themes available for WordPress sites. Users can also install WooCommerce-friendly themes designed to support major features such as product displays, slideshows and galleries.  

Moreover, WooCommerce stands out as a user-friendly solution that requires zero coding expertise, enabling anyone to configure their entire online store through the intuitive WordPress dashboard. Understanding what WooCommerce is starts with recognizing its beginner-friendly design—this powerful eCommerce plugin transforms your WordPress site into a fully functional online store without technical barriers. 

What is WooCommerce best for?

WooCommerce excels as a versatile eCommerce platform that extends far beyond traditional retail stores. Whether you’re selling physical products like clothing and electronics, offering digital downloads such as ebooks and software, managing service-based bookings or running subscription models, WooCommerce adapts seamlessly to your business model. This flexibility makes it the go-to solution for entrepreneurs who need a platform that grows with their unique vision.

What makes WooCommerce particularly powerful is its remarkable scalability. You might start with a side hustle selling handmade crafts from your home, then scale up to a full-fledged enterprise handling thousands of transactions daily. WooCommerce accommodates businesses at every stage of growth, from solo entrepreneurs testing product ideas to established brands expanding their online presence. The platform’s extensive library of extensions means you can add specialized functionality exactly when you need it—whether that’s membership subscriptions, appointment bookings or advanced product variations.

The true strength of WooCommerce lies in how it adapts to each merchant’s specific needs rather than forcing businesses into a one-size-fits-all solution. You maintain complete control over your store’s functionality, design and customer experience, allowing you to create an online shopping environment that perfectly reflects your brand and serves your customers effectively.

Is WooCommerce free? WooCommerce pricing 

One of WooCommerce’s standout features is its flexible pricing model. This makes it a popular choice for all-sized businesses, from budding startups to well-established enterprises. 

The core WooCommerce plugin is entirely free to download and use. So, you can transform your WordPress website into a fully operational online store without any initial investment. Even with the free version, you’ll have access to essential features like product listings, shopping carts, checkout page processes and basic payment options. 

However, to take your store’s functionality to the next level, you might find it useful to invest in premium extensions or add-ons. WooCommerce offers a vast selection of paid enhancements that you can purchase individually to tailor your store to your specific needs. 

Why is WooCommerce so popular?

WooCommerce has established itself as the leading eCommerce platform, powering over one-third of all online stores worldwide. This remarkable success stems from several key factors that set it apart in the crowded eCommerce landscape.

At its core, WooCommerce’s open-source nature provides unparalleled flexibility and freedom. As a free plugin built on WordPress—which powers a significant portion of the web—it gives you complete control over your store and data. Unlike proprietary platforms, you truly own your business without vendor lock-in or hidden restrictions. This foundation on WordPress also brings the trust of an officially recommended solution by WordPress.org itself, establishing credibility from the start.

The platform’s vast ecosystem of plugins and themes allows you to customize every aspect of your online store. Whether you need advanced shipping calculators, multilingual support or specialized payment gateways, thousands of extensions are available to meet your exact requirements. This extensibility means your store can grow and evolve alongside your business needs. Additionally, WooCommerce benefits from strong community support—millions of users, developers and entrepreneurs share knowledge, create solutions and continuously improve the platform.

This thriving community ensures you’re never alone in your eCommerce journey, with abundant resources, forums and documentation available whenever you need guidance.

Key features of WooCommerce

WooCommerce offers a comprehensive suite of features that make it the world’s leading eCommerce platform for WordPress websites. These powerful tools enable you to manage products, process payments, handle shipping, and grow your online store with ease.

1. Open-source nature 

Understanding open-source technology is crucial when exploring what WooCommerce is and how it powers eCommerce success. Open-source software provides unparalleled flexibility in the eCommerce world, especially when you’re ready to create a website for your online store. Here’s why this matters for WooCommerce users:

• Freedom to customize: Being open-source means WooCommerce gives you the reins. 
• Community support: When you use WooCommerce, you’re not walking this journey alone. There’s a vibrant community of developers, store owners and enthusiasts just like you. 
• No hidden costs: One of the best things about open source is transparency. With WooCommerce, what you see is what you get. No hidden fees, no unexpected surprises. 
• Flexibility galore: Whether you’re selling artisanal coffee beans, eBooks or subscription boxes, WooCommerce molds itself to fit your needs. 

2. Versatile product selling 

Whether you’re selling physical products, digital goods or services, WooCommerce is flexible enough to accommodate all types of products. Because of its adaptability, it suits a wide range of businesses and industries. 

3. Order and shipping management 

WooCommerce streamlines order and shipping management, offering a smooth experience from the moment an order is placed until it reaches the customer. With automated order tracking, real-time customer notifications and customizable shipping options, your fulfillment process stays efficient and hassle-free. 

4. Customer account area 

WooCommerce’s customer account dashboard enhances the online store experience by providing shoppers with an intuitive self-service portal. This dedicated account area empowers customers to manage personal information, review complete order histories, monitor shipment tracking in real-time, and seamlessly update shipping and billing addresses—giving them comprehensive control over every aspect of their eCommerce journey.

5. Tax settings 

With WooCommerce’s robust tax management tools, you can easily configure standard or reduced tax rates and automatically apply them based on your customer’s location. This is a crucial feature for businesses that sell internationally, as it ensures compliance with varying tax laws around the world. 

6. Payment gateway 

WooCommerce supports multiple payment gateways, making it simple for you to accept payments from all major sources. Popular gateways like PayPal, Stripe and credit cards are fully integrated, allowing you to offer flexible payment options that cater to your customer’s preferences and enhance the checkout experience. 

7. Inventory management 

Stay on top of your stock with WooCommerce’s detailed inventory management features. You’ll receive automatic alerts when items are running low or out of stock, helping you efficiently plan restocks and ensure you never miss a sale due to inventory issues. 

8. Customizable checkout process 

Create a checkout experience that fits your business model perfectly. WooCommerce allows you to modify checkout fields, offer guest checkout or enable one-click purchases. These customizable options help reduce cart abandonment and increase customer satisfaction, giving your store a competitive edge. 

9. Shopping rules 

WooCommerce’s flexible shopping rules let you tailor the purchasing process to your specific needs. From managing the order process and payments to handling product refunds, this feature allows you to define the customer journey and ensure a seamless shopping experience. 

10. Sales reporting 

Track your store’s performance with WooCommerce’s built-in sales reporting tools. If you need more advanced insights, you can expand functionality with additional reporting extensions. Some extensions even allow you to export reports into Excel or CSV for in-depth analysis. For tracking profits and losses, the WooCommerce Cost of Goods extension from SkyVerge is a useful option to consider.

Benefits of WooCommerce: Why use WooCommerce?

WooCommerce is a free-to-use eCommerce plugin that allows you to easily create a fully functional online store. Here are some other benefits of WooCommerce: 

1. WordPress integration 

WooCommerce is tailor-made for WordPress, offering seamless integration with the platform. This means you can easily add robust eCommerce capabilities to your existing WordPress website, taking advantage of its user-friendly content management system. 

2. Cost-effective solution 

One of the most attractive aspects of WooCommerce is its affordability. This core eCommerce plugin is completely free to download and use, allowing you to set up a functional online store without upfront costs. This makes it an excellent choice for small businesses and startups. However, as your store grows, you might opt to invest in advanced features, specialized themes or integrations with third-party tools, which could add some costs along the way. 

3. Comprehensive eCommerce features 

WooCommerce comes with a wealth of built-in eCommerce features. It provides tools for product management, inventory tracking, order processing and more, ensuring a smooth transaction process for both merchants and customers. 

4. Comprehensive documentation 

WooCommerce provides extensive documentation and resources that cover a wide range of topics. This is particularly valuable for web developers and store owners who want to personalize and enhance their online shops. 

5. Easy installation and setup 

Installing WooCommerce is as straightforward as adding any other plugin to your WordPress site. Available for free in the WordPress plugin directory, WooCommerce can be set up in a matter of minutes, thanks to its handy Setup Wizard. This makes configuring key store elements like secure payments and shipping options a quick and easy task, even for beginners. 

6. Highly extensible 

WooCommerce’s flexibility shines through its extensive range of eCommerce plugins and themes. With thousands of extensions at your disposal, you can tailor your online store to your own requirements. WooCommerce’s extensibility guarantees that you can scale and adjust as your company expands, whether you are improving the checkout experience, introducing additional payment methods, or connecting marketing tools. 

7. Strong community and support 

WooCommerce boasts a rich ecosystem of support, from well-documented guides to a thriving community of users and developers. Whether you need help troubleshooting or are looking for ways to enhance your store, the wealth of resources available ensures that assistance is always within reach. Plus, the community-driven nature of WooCommerce leads to continuous improvements and updates. 

8. Built-in analytics 

Tracking your store’s performance is essential for growth, and WooCommerce’s built-in analytics provide valuable insights into sales trends, customer behaviors and more. With easy-to-understand reports on key metrics like average order value and demographic data, you can make informed decisions that drive your business forward. 

9. Speed and security 

Fast load times and strong security are critical for any online business. WooCommerce, built on the reliable WordPress platform, benefits from regular updates and a commitment to security. When paired with a trustworthy hosting provider, WooCommerce ensures a fast, secure shopping experience for your customers, giving them peace of mind as they browse and purchase. 

10. SEO and marketing tools 

WooCommerce is designed with SEO best practices in mind. So, your store will rank better in search engine results. Additionally, it integrates seamlessly with various marketing tools and WordPress plugins, enabling you to implement strategies like email marketing, social media campaigns and promotional offers to grow your customer base and boost sales.

Pros and cons of WooCommerce

When evaluating WooCommerce for your online store, it’s important to understand both the advantages and challenges. On the positive side, WooCommerce offers complete customization control over every aspect of your store, from design to functionality. The plugin itself is free to download, making it a cost-effective choice with lower initial investment compared to hosted eCommerce platforms. Additionally, WooCommerce is built with SEO best practices in mind, helping your store rank better in search results. Its open-source nature means you have unlimited flexibility to scale and grow your business exactly as you envision.

However, WooCommerce does come with certain responsibilities. Beginners may face a learning curve when setting up and customizing their stores, particularly if they lack technical experience. You’re also responsible for critical tasks like security monitoring, regular backups and plugin updates—which can be time-consuming and complex for store owners who want to focus on their business rather than technical maintenance.

The good news is that choosing a managed hosting provider like Bluehost effectively eliminates these challenges. Bluehost WooCommerce hosting handles security monitoring, automated backups and system updates for you, combining WooCommerce’s powerful flexibility with worry-free maintenance. You get the best of both worlds: complete control over your store’s features and design, plus expert technical support and automated security—allowing you to focus entirely on growing your eCommerce business.

How does WooCommerce work? 

With the help of the free WooCommerce plugin, you can transform your WordPress website into a fully functional eCommerce store. With its seamless integration, WooCommerce gives your WordPress website all the features you require, such as product pages, shopping carts and checkout features. Now that we’ve covered how WooCommerce works, let’s walk through the setup process. 

How to set up a WooCommerce store?

Setting up a WooCommerce store involves installing the WooCommerce plugin on WordPress, configuring your store settings, adding products and setting up payment methods. Follow these essential steps to launch your online store successfully.

1. Get hosting and a domain name
2. Install WordPress
3. Install the WooCommerce plugin
4. Install a WooCommerce-compatible WordPress theme
5. Set up the WooCommerce shop
6. Add products
7. Set up payment gateways
8. Manage discounts
9. Manage orders
10. Setup Analytics
11. Add more features with WooCommerce extensions

Let’s explore all steps in detail.

Related: Learn how to install and set up the WooCommerce plugin here

Step 1: Get hosting and a domain name 

The first step to launching your WooCommerce store is selecting a hosting provider and registering a domain name. Your hosting provider stores your website’s data and ensures your site is always accessible, while your domain name serves as your store’s unique web address. 

When setting up WooCommerce, choosing a hosting provider that offers robust performance and seamless WooCommerce compatibility is essential, along with selecting a memorable domain name that embodies your brand identity. Bluehost streamlines this process by bundling hosting and domain registration together, complete with automatic WordPress installation, making it an ideal solution for those wondering what WooCommerce hosting entails and how to get started efficiently.

Once you have your hosting account with a reliable web hosting provider, you’re ready to get started. WooCommerce compatibility ensures that your online store aligns properly with your brand’s requirements.

Ready to launch your online store? Bluehost WooCommerce hosting comes pre-configured with everything you need to start selling online, including automatic WooCommerce installation, optimized performance and expert 24/7 support to help your eCommerce business succeed.

Step 2: Install WordPress 

Since WooCommerce is a WordPress plugin, your next task is to install WordPress on your hosting account. Most hosting providers simplify this step with one-click WordPress installations, allowing you to set it up in minutes. After installation, the WordPress dashboard is available for you to start customizing your eCommerce site. 

Step 3: Install the WooCommerce plugin 

With WordPress ready, it’s time to transform your site into an online store by installing the WooCommerce plugin. Here’s how to do it: 

1. Log in to your WordPress admin area (usually via [yourdomain].com/wp-admin/).
2. In the sidebar, go to the ‘Plugins’ tab and then click on ‘Add New’.

3. In the search bar, enter ‘WooCommerce’. The plugin will appear at the top.

4. Click ‘Install Now’ next to WooCommerce, and once installed, hit the ‘Activate’ button.

5. After activation, the WooCommerce Setup Wizard will launch, guiding you through the essential configurations for your store.

Step 4: Install a WooCommerce-compatible WordPress theme 

Your store’s appearance plays a significant role in attracting customers, so choose a WooCommerce-compatible WordPress theme that aligns with your brand and provides a seamless shopping experience. Here’s how to install a theme: 

Download your chosen WooCommerce theme to your computer 

From your WordPress dashboard, locate the ‘Appearance’ tab and click on ‘Themes’. Then click ‘Upload’. 

Select the theme file from your computer. Once it is uploaded, click “Install Now” and then activate it. From here, you can explore customization options to perfect your store’s look and feel. 

Also read: Premium WooCommerce Themes for eCommerce

Step 5: Set up the WooCommerce shop 

The Setup Wizard will help you configure key store settings, including currency preferences, payment methods, shipping options and taxes. It’s important to take your time here to ensure your store operates smoothly from day one. 

Step 6: Add products 

With your store framework in place, it’s time to populate it with products. WooCommerce makes it easy to add detailed product descriptions, prices, images and more. Organize your products into categories and tags to enhance customer navigation. 

1. Simply head to ‘Products’ > ‘Add New’, and fill in the product name, description, images and other relevant details.

2. Once done, hit ‘Publish’, and your product will be live on your site.

Step 7: Set up payment gateways 

To start processing transactions, you’ll need to configure payment gateways. WooCommerce supports popular options like PayPal and Stripe, among others. Here’s how to set them up: 

1. Go to ‘WooCommerce’ > ‘Settings’ > ‘Payments’ from your dashboard.
2. Toggle the switches to enable your chosen payment methods, such as PayPal or Stripe.

3. For PayPal, click ‘Set Up’ and enter your PayPal email address along with any other configuration details. If you are a Bluehost user with WooCommerce hosting, you get an option to enable YITH PayPal Payments.

4. For Stripe, you’ll need to provide your API keys from your Stripe account. Both PayPal and Stripe allow you to securely process payments, with no startup costs, though standard processing fees apply.

5. You can add more payment methods by enabling WooPayments, COD (Cash on delivery), direct bank transfer and more.

Step 8: Manage discounts 

Discounts are a powerful way to boost sales, and WooCommerce makes setting up coupons easy. Navigate to the “Coupons” page, where you can add new coupons or edit existing ones to offer deals to your customers. 

Bluehost offers the WonderCart with WooCommerce hosting plans. This tool allows you to easily create sales offers, coupons and promotions for your customers. 

Step 9: Manage orders 

Once your products are live, and your payment methods are set, you’ll need to handle incoming orders. WooCommerce provides an “Orders” section in the WordPress dashboard where you can view and manage every order. 

Each order comes with a unique ID and includes customer details like email, address and payment method. You can also update order statuses directly from this page to keep customers informed. 

Step 10: Setup Analytics 

WooCommerces Analytics feature allows you to monitor your store’s performance. From the Analytics section in the dashboard, you can track key metrics such as purchases, gross sales and average daily sales. 

Reports can be customized to display statistics for individual products, categories, orders, customers and more. 

Note: WooCommerce Reports has been replaced after the release of WooCommerce 4.0. Analytics is available for all the users running WordPress 5.3 and above versions.

Step 11: Add more features with WooCommerce extensions 

While WooCommerce comes with a rich feature set, you might need additional functionality as your business grows. 

WooCommerce extensions offer a range of options to enhance your store, from accepting multiple payment gateways to improving shipping logistics, integrating marketing tools or automating accounting processes. These simple to install extensions can significantly expand your store’s capabilities as needed. 

Is WooCommerce the right choice for you? 

The choice hinges on your website’s nature and your CMS selection. WooCommerce, an extension tailored for WordPress, caters to eCommerce stores seamlessly. If you’re contemplating an online store within WordPress, this plugin is indispensable and, remarkably, it’s cost-free, offering an array of benefits. 

WooCommerce allows you to sell various items, from physical and digital products to reservations and services. Users who may benefit from using WooCommerce include: 

• Individuals seeking a simple, professional approach to crafting online store websites. 
• Companies striving to swiftly construct their eCommerce platforms autonomously. 
• Users crave complete transaction control on their online store websites. 
• Anyone yearning to transform their WordPress websites into fully operational online stores. 

WooCommerce is an outstanding choice for those venturing into eCommerce using WordPress as their CMS. This complete guide allows you to enhance your online business using WooCommerce, ensuring you can commence selling services or products with ease. 

Final thoughts 

WooCommerce is an open-source eCommerce platform, just like WordPress, making it freely accessible for anyone to build and launch their online store. This widely-adopted solution is backed by an extensive community of users and developers worldwide, along with a growing library of tutorials and comprehensive guides that provide the support you need to succeed in eCommerce.

The benefits of WooCommerce—from its extensive features and customizable extensions to its supportive global community—make it the ideal choice for online entrepreneurs. Whether you’re just learning how to use WooCommerce or ready to scale your business, this platform grows with you.

Setting up your WooCommerce store is easy with Bluehost. Get started today with WooCommerce hosting that delivers speed, security and expert support for your online success.

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