Launching a business online can be exciting and profitable. It’s a great way to supplement an existing income stream or even to become one’s sole occupation. Many individuals and small businesses have met with tremendous success, some making literally millions of dollars a year, even after starting at ground zero, with no knowledge of the Internet beyond the very basics, if that. There are no guarantees, but it can be done. It does require patience and a willingness to go through the steps to get it right, though. That’s what we’re going to teach you here.
Why Three Services?
In this book we explain how to use three different “channels” to build your business online:
■ Selling products through eBay auctions
■ Setting up an online store using Yahoo! Merchant Solutions
■ Promoting your business through Google, other search engines, and various other onlinemarketing mechanisms.
Why three channels? There are a number of reasons:
■ Few businesses are simple enough to survive with a single method for finding business. If you sell hot dogs to people who eat hot dogs, you may need only to place your hot-dog stand on a busy street. But if you sell hot dogs to businesses that sell hot dogs to people, you would use many different ways to reach those businesses.
■ What works well for one business may not work so well for another. Using multiple
channels to sell and to reach people increases the likelihood that you find the best one.
Multiple channels provide multiple opportunities. If you can find people to buy your
products more than one way, why leave money on the table by only using one method?
■ You’ll find some of the things we suggest in this book can be implemented very quickly,
in some cases in just a few hours. Having a range of different options helps you get your
toes wet and work your way in slowly. For instance, an already established business
could begin selling online with eBay over a weekend, gradually build the online
business, then investigate other sales channels later.
While it’s true that some businesses have done very well by finding something simple that
works and doing it over and over again for decades, most businesses are not so fortunate. Thanks
to competitive pressures—other people want your customers too; remember—most businesses
have to do many things in order to survive and thrive. What works today may not work tomorrow.
Some method you try for finding more business may not work, or may not work well as something
you haven’t yet tried. Business is an evolutionary process, with the notion of natural selection
replaced by the degree of initiative of the business owners and managers. A business gradually
evolves as the people running the business try new things, discard things that don’t work or that
no longer work, and adopt techniques that show promise.
The three-channel method outlined in this book provides a great way to get started with an
online business, showing you a number of essential techniques for surviving—and thriving—online.
In particular, companies succeeding online often use a number of strategies to do so. These
are the sort of things you may one day find yourself doing:
■ Selling through online auctions
■ Selling through discount channels, such as Overstock.com
■ Selling through merchant sites such as Amazon.com
■ Selling through a web store or, in some cases, several web stores, for different audiences or perhaps different pricing strategies
■ Buying Pay Per Click ads to bring buyers from the search engines to your store
■ Using Search Engine Optimization to bring buyers from the search engines without paying a click fee
■ If you own an offline business, using various techniques to integrate online and offline operations, pushing business from the offline business to the online, and vice versa
■ Using an affiliate program, paying other web sites commissions for purchases made by buyers arriving at your store through affiliate sites
■ Publishing an e-mail newsletter to keep in touch with customers and promote your products to their friends
■ Marketing through PR campaigns targeting e-mail newsletter editors
■ Promoting your products through discussion groups
■ And many other things .....
One thing you can say about doing business online is that however successful you become, there’s always more to learn!
What Makes a Good Online Product?
Just about any product can be sold online. But let’s be quite clear; some products sell much better than others. Let’s think about some product characteristics that both help and hurt products when selling online:
■ Price:weight ratio The price:weight ratio needs to be high; that is the price, in comparison to the weight, needs to be high. Books have a very high price:weight ratio— a book might be worth, say, $30/lb. Sugar might be around 35 cents/lb. The price:weight ratio issue is why it’s hard to sell sugar, cement, and charcoal online.
■ Availability Less available is good. Available everywhere is bad. That’s why it’s hard to sell candy bars online.
■ Information products Products that are essentially information sell well online. Books, reports, reference materials . . . even music is an information product, really. Why do they do well online? Because online technology provides a very efficient way to deliver information. It’s fast and it’s cheap. It’s no wonder that books were the first major product category online and remain one of the primary categories.
■ Complicated products requiring research The Internet is the perfect research tool, of course. Products that require careful selection—products with many different features— often do well online.
■ Wide selection of specialty products An example is one of the earliest small-biz successes, HotHotHot.com, an online success for over a decade. Sure, you can find hot sauce in any grocery store. But can you find Jamaican Hell Fire, Rigor Mortis Hot Sauce, 99%, or 3:00 AM? (The company provides 100 different brands.) Have you even heard of these? Another example is RedWagons.com. Certainly you can find two or three different Radio Flyer wagons in most toy stores, but where else can you find every Radio Flyer product made—steel wagons, plastic wagons, trikes, scooters, retro rockets, roadsters, and everything else?
■ Deals There’s a class of goods that crosses all classes, and even covers products that you might think of as Not Good Internet Products. If you can sell a particular product at a very low price, you may have a good Internet product. Hey, if you can get the price of sugar down low enough, you might be able to sell that online.
■ “Cool” products that sell themselves through word of mouth There are some products that are just so cool, people tell their friends. One company that gets fantastic word of mouth is ThinkGeek.com, which sells tons of really cool stuff (Figure 1-1).
Another example of a great word-of-mouth site is Despair.com. This company sells
products that people put on their office walls and laugh about with their friends.
