Here’s advice for any business giving serious consideration to selling goods and services online: Before diving into electronic commerce, make sure to get your feet wet in such critical areas as marketing, networking, branding, fulfillment and customer service.
Novices can hone these skills by selling on eBay or placing products on Amazon Marketplace. But even well-established businesses must realize that an online presence involves venturing into such new territories as the blogosphere and social media.
None of this is any reason to shy away. The upside is too great. In March, Walt Disney Co. CEO Robert Iger said his company is on track to generate $1 billion in online revenue this year. Those expectations are too lofty for most, but consider recent figures from the U.S. Census Bureau: Total e-commerce sales for 2007 reached about $136.4 billion, a 19 percent increase from the year before.
Amanda Vega is a former AOL employee who now operates Amanda Vega Consulting, an integrated marketing firm currently headquartered in Phoenix. A big part of her business is Web site development and related services. She sees e-commerce as a viable option for two kinds of entrepreneurs.
“People should consider it if they think that there’s a place in the market that isn’t being serviced by someone else or isn’t being serviced adequately,” she says. “Or (it offers) a natural extension to their brick-and-mortar store to help give them a national or international presence instead of just going the traditional route and building store No. 2 and store No. 3, which can cost a lot more than doing it online.”
The nice part about operating an effective e-commerce Web site is there are more ways to make money than just selling your own products or services. One method, according to Vega, is through affiliate deals with complementary companies.
“Even if it’s, let’s say, $300 a month that you’re making somehow behind the scenes for referring to other products or vendors, it’s still more income than the business owner had coming in through the traditional door,” she says.
Mark Sharkey, the owner of Mesa-based PrecisionPros.com Network and such related companies as DynamicPros.com, which provides Web programming services, says there are a variety of opportunities for those with content-rich sites that generate frequent repeat visits.
“If there’s a reason for people to keep coming back all the time,” Sharkey says, “then those types of sites will easily generate money from selling banner advertisements or doing a link-exchange kind of setup where they get paid based on the number of people that see an advertisement on the Web site, click through and go to another Web site.
“The great thing about an e-commerce Web site is that it can make money for you 24 hours a day,” he continues. “You don’t have to be in your office for it to make money for you. You don’t have to restrict your business to the local market. You have a worldwide market that’s available to you now.”
Deciding whether to enter the e-commerce arena won’t be your biggest decision. Deciding how to go about it the right way will be. More times than not, this means involving people like Vega or Sharkey to help with such things as research, development, design and marketing.
There are many crucial elements that contribute to a successful site, and not just from a visual standpoint.
Create a user-friendly site that enhances the customer’s shopping experience. Provide good information and make it easy to navigate. Make sure the customer feels safe when placing an order and providing personal information.
“The Internet is an open forum and if we don’t encrypt that data, it’s easy to see and steal that information,” Sharkey says. “You want to make sure the Web site itself is set up or the Web server is set up to handle secure transactions.”
There’s also the issue of real-time credit card processing. If you go this route, make sure you have a reputable company processing transactions.
You need to be on a server with a fast response time or risk losing impatient visitors. And don’t forget product availability and production times. This is not the old mail-order business. No one’s willing to wait six to eight weeks. Customers expect prompt delivery. If you promise to ship within 24 hours, Vega says, customers start counting from the time of purchase, not from the time you arrive at your office the next day.
“Those are the questions that I think people don’t think about,” she says. It may be less expensive to operate an online business than a brick-and-mortar store, “but there are extra costs associated with the fact that now your business is 24/7.”
Vega points out that if you mess up, online shoppers can quickly spread the word through blogs, forums, message boards and other social-media means.
Also, there are numerous marketing considerations, some costly and others that require hard work and smart decisions. This includes optimizing your Web site for search engines through the proper use of keywords and by generating inbound links from relevant sites. It may mean creating a blog and establishing yourself as an industry expert to help drive customers to your site. You might experiment with online advertising in some of its various forms. There’s also traditional advertising and public relations.
As Vega says, “You can’t just throw the store online and say, ‘OK, go.’ ”