As the children of the 90s that grew up in the computer age reach their teens online business scramble to satiate their shopping and technology needs. The main difference between the younger online shoppers and the older ones is the expectations. While older online shoppers struggle to keep up with technology, it is technology that is trying to keep pace with the younger generation.
Younger tech users are exceedingly talented in grasping new advances in technology and become bored very quickly. They seem to always be in a big hurry to go nowhere. An 8 second wait for a web page to load seems agonizingly painful for these fidgety couch potatoes. However they are more inclined to make an online purchase for something "cool" than their older counterparts, and that is why many online retailers have turned their attention to satisfying the needs of these schizophrenic multimedia junkies.
As was the case during the first depression, the few industries to thrive have been the entertainment industry and the cosmetic industries, well in part, that is. While the purchase of high ticket items such as flat screen televisions has declined the purchase of video game systems has risen. Additionally, while many have been avoiding those expensive wardrobe upgrades, many have also sought deals on accessories and makeup at discount retailers such as Walmart.
Perhaps women are trying to make themselves attractive in order to score that handsome and rich mate, who happens to be locked in his room playing video games. Unusual circumstances for unusual times.
The key to unlocking the piggy banks (if they exist) of our new spenders. Is to offer them the products they need at the speed and convenience of which they have come to expect. Keep in mind that we are dealing with a very complex group of youngsters here. As impatient as they my be to get their hands on the latest shoot em up game that lets them play out their fantasies of being a really bad person, they will kindly wait in line for tens of hours to be the first kid on the block to get it. But if successful they will get to enjoy the benefits of sitting at home while others come visit to play the new game and congratulate the proud owner.
What if a company could somehow get an online preview of a video game, advertise it's release and take orders online while consumers sample the preview. This way they can expect to get the game in the mail before it even hits stores, genius, absolute genius. Perhaps some company will put this strategy into play soon, I am curious to know if it will be successful.
Yes, perhaps a bit odd, but then I think you have to think crazy these days, because as I get older I begin to understand why my parents always seemed so odd to me and could never understand where I was coming from. When it comes to youngins these days, I admit, I am a bit confused sometimes, but I will spend the time and energy necessary so that I can profit from this madness.
Tuesday, March 10, 2009
Friday, March 6, 2009
Economy Down, Web Traffic Up
It appears that higher gas prices combined with a bleak economic situation has caused more Americans to stay home and either watch tv or surf the web. Additionally, bargain hunters shift through websites in search of bargains. Internet advertisers are dishing out tons of money for web surfer attention and ultimately conversion.
What does this website traffic mean for you? That would depend on what type of online presence you have. Do you run an ecommerce website? Perhaps an affiliate marketing website. Maybe you are blogging for cash. Whatever it is you do if you have seen an increase in traffic, you may have thought to yourself, how can I capitalize on this? In order to find an answer to this question you will need to gather some informaion. How do visitors get to your website? What did they type into the search engine to get there? How long did they stay and what did they click on?
If you own a website you most likely have Google analytics setup so you can easily access this information. The next step is to make use of it. If you can determine how traffic got to your website then you can figure out what to to capitalize on it. If you are a part of an affiliate program then you can paste in some appropriate affiliate information. If you provide content then your Google Adsense campaign should already generate some clicks from interested parties. But if you actually provide the products, services or information that visitors are looking for then you are in a great position to benefit on a much larger scale.
Perhaps it may be time to make some adjustments to your website. Figure out what it is exactly that visitors are looking for and make it easy and obvious for them to find it. Setup your website and links in a manner that will direct you visitors to a place where they are inticed to make a purchasing decision and give them clear reasons to make that decision at that moment. Use typical marketing strategies such as offer expires soon or last day for savings. whatever you have to do to get them to sign up.
Take advantage of increased traffic while it lasts. In our tough economic times you may soon lose visitors as many people will be forced to take low paying jobs and end up having to take two or three of them, spending less time online.
What does this website traffic mean for you? That would depend on what type of online presence you have. Do you run an ecommerce website? Perhaps an affiliate marketing website. Maybe you are blogging for cash. Whatever it is you do if you have seen an increase in traffic, you may have thought to yourself, how can I capitalize on this? In order to find an answer to this question you will need to gather some informaion. How do visitors get to your website? What did they type into the search engine to get there? How long did they stay and what did they click on?
If you own a website you most likely have Google analytics setup so you can easily access this information. The next step is to make use of it. If you can determine how traffic got to your website then you can figure out what to to capitalize on it. If you are a part of an affiliate program then you can paste in some appropriate affiliate information. If you provide content then your Google Adsense campaign should already generate some clicks from interested parties. But if you actually provide the products, services or information that visitors are looking for then you are in a great position to benefit on a much larger scale.
Perhaps it may be time to make some adjustments to your website. Figure out what it is exactly that visitors are looking for and make it easy and obvious for them to find it. Setup your website and links in a manner that will direct you visitors to a place where they are inticed to make a purchasing decision and give them clear reasons to make that decision at that moment. Use typical marketing strategies such as offer expires soon or last day for savings. whatever you have to do to get them to sign up.
Take advantage of increased traffic while it lasts. In our tough economic times you may soon lose visitors as many people will be forced to take low paying jobs and end up having to take two or three of them, spending less time online.
Thursday, January 29, 2009
Open Source VS Paid Solutions
Are you considering starting your own internet store? If so you are probably in the process of researching all of the options that are available and trying to figure out what works best. This process will certainly prove to be extremely time consuming and somewhat confusing if you are fairly new to ecommerce.
Instead of listing every single solution that is available and detailing what each offers, which may take a while and prove to be uninteresting, I will try to present an overview of the two basic options available. Open source and paid soultions.
Open source is software that is provided for free or at minimal cost. It is referred to as open source because the source code of the software is provided so that the end user can alter the code to suit there needs and may redistribute the finished product as part of the GNU agreement.
Most paid solutions have built-in customizable features but do not allow open access to the source code and/or do not offer permission to alter the code and redistribute the software.
Shopping cart solutions can run anywhere from free to tens of thousands of dollars. The difference in price can usually be attributed to the level of support that is offered. While open source typically generates large community forums where users can share information, tips and add-ons, some of which are free, paid solutions often come with live phone support and may be built to suit so that there is no additional work required of the end user.
In regards to ecommerce website design, paid solutions will often come with built-in templates that can be modified by choosing skins and replacing images. Open source solutions often provide the same options built-in but because it is open source, users my also be able to choose from a wide assortment of templates created by multiple developers ranging from small companies to individuals.
If a web store owner prefers to have a store completely customized then there is usually an additional fee from paid solutions companies. With an open source solution a store owner may be able to choose from a number of companies or individuals that can manipulate the code to create the desired product.
For first time ecommerce entrepreneurs experimenting with a free shopping cart solution can provide valuable insight and experience. Open source shopping carts can sometimes be overlooked because they happen to be free, but many of these free options are actually powerful, efficient, workable solutions. Quite a few businesses run successful operations using open source products.
The support provided by paid solutions my be appealing to the entrepreneur that does not have a technical team but needs very specific accomodations.
Once created, both a free ecommerce website and one that may have cost tens of thousands of dollars have the same potential and access to online business. The effectiveness of design and usuability are important to success but so is effective marketing and search engine optimization optimization.
At the end of the day it would be a combination of the good marketing (and the budget involved), search engine optimization, advertising that drives potential customers to the website. The ability to convert visitors to customers depends on the appeal of the product, price, presentation and ability to easily navigate and purchase products.
Instead of listing every single solution that is available and detailing what each offers, which may take a while and prove to be uninteresting, I will try to present an overview of the two basic options available. Open source and paid soultions.
Open source is software that is provided for free or at minimal cost. It is referred to as open source because the source code of the software is provided so that the end user can alter the code to suit there needs and may redistribute the finished product as part of the GNU agreement.
Most paid solutions have built-in customizable features but do not allow open access to the source code and/or do not offer permission to alter the code and redistribute the software.
Shopping cart solutions can run anywhere from free to tens of thousands of dollars. The difference in price can usually be attributed to the level of support that is offered. While open source typically generates large community forums where users can share information, tips and add-ons, some of which are free, paid solutions often come with live phone support and may be built to suit so that there is no additional work required of the end user.
In regards to ecommerce website design, paid solutions will often come with built-in templates that can be modified by choosing skins and replacing images. Open source solutions often provide the same options built-in but because it is open source, users my also be able to choose from a wide assortment of templates created by multiple developers ranging from small companies to individuals.
If a web store owner prefers to have a store completely customized then there is usually an additional fee from paid solutions companies. With an open source solution a store owner may be able to choose from a number of companies or individuals that can manipulate the code to create the desired product.
For first time ecommerce entrepreneurs experimenting with a free shopping cart solution can provide valuable insight and experience. Open source shopping carts can sometimes be overlooked because they happen to be free, but many of these free options are actually powerful, efficient, workable solutions. Quite a few businesses run successful operations using open source products.
The support provided by paid solutions my be appealing to the entrepreneur that does not have a technical team but needs very specific accomodations.
Once created, both a free ecommerce website and one that may have cost tens of thousands of dollars have the same potential and access to online business. The effectiveness of design and usuability are important to success but so is effective marketing and search engine optimization optimization.
At the end of the day it would be a combination of the good marketing (and the budget involved), search engine optimization, advertising that drives potential customers to the website. The ability to convert visitors to customers depends on the appeal of the product, price, presentation and ability to easily navigate and purchase products.
Saturday, January 24, 2009
Selling Online
Many people ask themselves the same question when it comes to starting a new online store. What should I sell online or what can I sell online? The answers are many as 10 minutes of browsing online will prove. What's even more interesting is the number of people who all have the same idea. If you are interested in knowing what to sell online there are some articles on this blog and on the website www.sellfromtheweb.com that can help you out but the focus of this blog entry is to discuss how to sell whatever it is you decided to sell online.
If you have a unique product that helps meet the needs of consumers then you are ahead of the game. Otherwise, if you are trying to sell something online that many others are selling then you have probably been met with a struggle. In order to compete you need to offer incentive. Coupons are a great way to attract some customers to your store, even if you barely make a profit off of the item a coupon is a great way to get a customer to make an initial purchase from your company, then it is up to you to cast a great impression on them. if you can deliver their product quickly and make them happy then you may have found yourself not only just 1 more customer but perhaps a few.
Once you have captured the first sale your job is to now send out a few more coupons, coupons that can be emailed to friends. Your first customer, having had a good experience, will then forward the coupons on to friends that may need the same product at a great price and with excellent service. Now you should have 2 customers, repeat the process and you can potentially grow exponentially.
Once you generate a substantial mailing list you can send out online store catalogs via email that link to products in your store, offer some more specials and you can see your business grow exponentially. Once your ecommerce store begins to generate some steady traffic and income then you can go ahead and begin to slowly raise prices and increase marketing. This is what is known as the penetration method. First penetrate the market with low pricing and great service and then slowly increase prices to meet those of your competitors. By the time you have done this you should have been able to create a great reputation for customer service, this will now give you the edge over your ecommerce competition.
It is not easy and certainly won't gurantee any quick results, building an online reputation takes time but will pay off in the end. By marketing directly you can save costs on pay per click advertising and lower overhead so that you can offer highly competitive pricing.
If you have a unique product that helps meet the needs of consumers then you are ahead of the game. Otherwise, if you are trying to sell something online that many others are selling then you have probably been met with a struggle. In order to compete you need to offer incentive. Coupons are a great way to attract some customers to your store, even if you barely make a profit off of the item a coupon is a great way to get a customer to make an initial purchase from your company, then it is up to you to cast a great impression on them. if you can deliver their product quickly and make them happy then you may have found yourself not only just 1 more customer but perhaps a few.
Once you have captured the first sale your job is to now send out a few more coupons, coupons that can be emailed to friends. Your first customer, having had a good experience, will then forward the coupons on to friends that may need the same product at a great price and with excellent service. Now you should have 2 customers, repeat the process and you can potentially grow exponentially.
Once you generate a substantial mailing list you can send out online store catalogs via email that link to products in your store, offer some more specials and you can see your business grow exponentially. Once your ecommerce store begins to generate some steady traffic and income then you can go ahead and begin to slowly raise prices and increase marketing. This is what is known as the penetration method. First penetrate the market with low pricing and great service and then slowly increase prices to meet those of your competitors. By the time you have done this you should have been able to create a great reputation for customer service, this will now give you the edge over your ecommerce competition.
It is not easy and certainly won't gurantee any quick results, building an online reputation takes time but will pay off in the end. By marketing directly you can save costs on pay per click advertising and lower overhead so that you can offer highly competitive pricing.
Working From Home
The technology and tools made available by the development of the internet has contributed to the increase in numbers of individuals starting home based businesses. New opportunities have become available in areas such as consultation, graphic and web design, marketing and ecommerce. The number of individuals starting new home based businesses of this nature out number those that start business such as professional services, child care, catering and bed and breakfasts.
There are many reasons to start a home based business. Mothers may decide to start a home based business in order to keep busy or supplement their incomes while they care for their children. Some may simply want a hobby or need to generate extra income. Most home based business start on a part time basis and if successful go on to become full time operations. The development of the internet has made it possible to run a business out of your home for a fraction of what it would have cost 20 years ago.
Running a home based business in your spare time for supplemental income can be fun and interesting. If you are interested in starting a business from your home it would certainly be a good idea to start small and determine if you meet the qualifications of running a home based business.
Starting A Home Based Business
Even if you are starting a business on a part time basis it is a good idea to approach it in the same manner as starting a full time operation. Draw up a clear business plan and consider some of the following factors:
1. Do you have the personality and discipline it takes to manage your own business.
2. Do you have the tools necessary to run a business from your home.
3. How will the business affect the lives of those living in the home.
4. What will you be selling and at what price.
5. What is the demand for your product/service.
6. Who is your target market.
7. What are your business objectives.
8. What methods will you use to achieve your objectives.
There will be more questions to answer as you proceed but these general questions will help you get started planning how to develop and execute your strategies.
Owning and running your own business can be extremely rewarding both financially (if done right of course) and on a personal level. The satisfaction of personal achievement is generally much greater than that of an individual working for someone else.
Running A Full Time Business
If you are successful and decide to operate your business full time you should seriously consider all that that will require of you. For instance:
1. How much will you need to make to support yourself/family.
2. How much time will you need to spend running your business.
3. Will you need additional capital.
4. Will you need to legally register your new business.
5. Do you have enough saved in case your business fails.
6. Can you provide yourself/family with health care.
Perhaps one of the most underestimated factor is that of the time requirements. Some individuals may want to start their own business because they want to enjoy the freedom of working for themselves. In actuality if may be more demanding to work for yourself than it is to work for an employer. You must have the discipline to wake up each morning and report for duty. And with your own business, especially one you run from home, there is no quitting time, you are basically working around the clock.
Another factor that you may want to consider is the impact that working for yourself from home will have on your social life. You may not be able to make new friends or have anyone to crack jokes with to help pass the time. Of course if you are successful and can employ others with your business then you will not encounter this problem, but you may have another problem. Are you capable of managing others, can you afford to keep employees if business is slow?
If you can handle running your own business and you are successful then you may enjoy much freedom and a great sense of accomplishment. If this doesn't happen the first time around do not be discouraged, most small business, especially those started part time from home eventually fail or simply subside. But you can be certain that if you gave it a go that you learned something from it. This experience will help prepare you for your next adventure and hopefully if you made some mistakes you won't make them again. Also, upon examining the reasons why you may not have succeeded you might make some discoveries and explore various strategies or different business you can try.
Perhaps you can benefit from learning some new skills while you investigate new ventures. You may also be able to find some small business courses at your neighborhood community college you can take in your spare time to help prepare you for running your business. Not only can you get some valuable resources from attending such classes but you also be able to network and find like minded individuals that you may form beneficial relationships with.
Beware Of Scams
The growing popularity of working from home has attracted the attention of scammers. Some parties will try and sell you a half baked idea of a business you can run from home that simply won't work. Or you may find yourself paying for a product that you will never receive. You can sometimes spot these ad very easily, they often advertise something to the effect of "become a millionaire in 4 minutes with a proven system that works!" Sometimes they may be more modest and even somewhat believable. But honestly, think for a moment before paying for any information like this, even if it is only $9.99. If something sounds too good to be true, then...that because it is not true at all. If you come across something that sounds like a scam contact the attorney general's office. We would all like to rid the earth of these scamsters.
Whatever it is you decide to do the important thing is to plan accordingly. Know what it is that you want to accomplish and carefully outline the steps you will need to take to get there. If you can try and speak with others that are currently doing whatever it is that you hope to do. Talk to as many as are willing to share information with you. A 5 minute conversation may save you 5 months of time, effort and capital if it turns out that your are neither equipped for or interested in dealing with what it takes to succeed in your area of interest.
There are many reasons to start a home based business. Mothers may decide to start a home based business in order to keep busy or supplement their incomes while they care for their children. Some may simply want a hobby or need to generate extra income. Most home based business start on a part time basis and if successful go on to become full time operations. The development of the internet has made it possible to run a business out of your home for a fraction of what it would have cost 20 years ago.
Running a home based business in your spare time for supplemental income can be fun and interesting. If you are interested in starting a business from your home it would certainly be a good idea to start small and determine if you meet the qualifications of running a home based business.
Starting A Home Based Business
Even if you are starting a business on a part time basis it is a good idea to approach it in the same manner as starting a full time operation. Draw up a clear business plan and consider some of the following factors:
1. Do you have the personality and discipline it takes to manage your own business.
2. Do you have the tools necessary to run a business from your home.
3. How will the business affect the lives of those living in the home.
4. What will you be selling and at what price.
5. What is the demand for your product/service.
6. Who is your target market.
7. What are your business objectives.
8. What methods will you use to achieve your objectives.
There will be more questions to answer as you proceed but these general questions will help you get started planning how to develop and execute your strategies.
Owning and running your own business can be extremely rewarding both financially (if done right of course) and on a personal level. The satisfaction of personal achievement is generally much greater than that of an individual working for someone else.
Running A Full Time Business
If you are successful and decide to operate your business full time you should seriously consider all that that will require of you. For instance:
1. How much will you need to make to support yourself/family.
2. How much time will you need to spend running your business.
3. Will you need additional capital.
4. Will you need to legally register your new business.
5. Do you have enough saved in case your business fails.
6. Can you provide yourself/family with health care.
Perhaps one of the most underestimated factor is that of the time requirements. Some individuals may want to start their own business because they want to enjoy the freedom of working for themselves. In actuality if may be more demanding to work for yourself than it is to work for an employer. You must have the discipline to wake up each morning and report for duty. And with your own business, especially one you run from home, there is no quitting time, you are basically working around the clock.
Another factor that you may want to consider is the impact that working for yourself from home will have on your social life. You may not be able to make new friends or have anyone to crack jokes with to help pass the time. Of course if you are successful and can employ others with your business then you will not encounter this problem, but you may have another problem. Are you capable of managing others, can you afford to keep employees if business is slow?
If you can handle running your own business and you are successful then you may enjoy much freedom and a great sense of accomplishment. If this doesn't happen the first time around do not be discouraged, most small business, especially those started part time from home eventually fail or simply subside. But you can be certain that if you gave it a go that you learned something from it. This experience will help prepare you for your next adventure and hopefully if you made some mistakes you won't make them again. Also, upon examining the reasons why you may not have succeeded you might make some discoveries and explore various strategies or different business you can try.
Perhaps you can benefit from learning some new skills while you investigate new ventures. You may also be able to find some small business courses at your neighborhood community college you can take in your spare time to help prepare you for running your business. Not only can you get some valuable resources from attending such classes but you also be able to network and find like minded individuals that you may form beneficial relationships with.
Beware Of Scams
The growing popularity of working from home has attracted the attention of scammers. Some parties will try and sell you a half baked idea of a business you can run from home that simply won't work. Or you may find yourself paying for a product that you will never receive. You can sometimes spot these ad very easily, they often advertise something to the effect of "become a millionaire in 4 minutes with a proven system that works!" Sometimes they may be more modest and even somewhat believable. But honestly, think for a moment before paying for any information like this, even if it is only $9.99. If something sounds too good to be true, then...that because it is not true at all. If you come across something that sounds like a scam contact the attorney general's office. We would all like to rid the earth of these scamsters.
Whatever it is you decide to do the important thing is to plan accordingly. Know what it is that you want to accomplish and carefully outline the steps you will need to take to get there. If you can try and speak with others that are currently doing whatever it is that you hope to do. Talk to as many as are willing to share information with you. A 5 minute conversation may save you 5 months of time, effort and capital if it turns out that your are neither equipped for or interested in dealing with what it takes to succeed in your area of interest.
Writing A Business Plan
Before you invest money in buying expensive office equipment and stationary you should have a clear idea of what your goals are and the steps you will need to take in order to achieve them. This is called strategic planning. It would be nearly impossible to succeed without planning. Most companies and individuals clearly outline their objectives in a formal business plan. If you are planning to seek out investors or will need to secure a loan you simply must have a business plan.
Business Plan Outline
A business plan will include some general information regarding:
* The product or service.
* The target market.
* Marketing strategy.
* Available resources.
More detailed information would include:
* The current demand for the particular products or services that your company will be providing.
* Competitive analysis and the reasons why potential customers would buy from your company.
* Budget forecasts for proposed marketing initiatives and prospective return on investment.
* Assets and liabilities including available funds and projected investments if applicable.
This information will help you to assess whether or not the company can be successful and make some predictions as to how long it may take to become profitable.
General components of a successful business plan will include:
1. Table of Contents
2. Executive Summary
3. Management Structure
4. Business Description
5. Market Analysis & Sales Initiatives
6. Products & Services
7. Financial Information
8. Appendices
I. Table Of Contents
The table of contents is basically a reference to all of the sections contained in the business plan.
II. Executive Summary
The executive summary is a very important section of your business plan. It is basically the part of the plan that should capture the attention of the reader. In the executive summary you will present the company as it exists today, the history and the future projections of the company and how it is expected to grow.
It may make sense to write the executive summary last since it is basically a summary of your business plan, unless you already have a clear overview of your plans and are capable of presenting it in a clear and concise manner to your reader.
Contents of the Executive Summary
* The Mission Statement - A short explanation of your business initiatives.
* Start Date
* Name founders and their functions
* Number of employees
* Location of business
* Description of facilities/offices
* Products manufactured/services rendered
* Banking relationships and information regarding current investors
* Summary of company growth and development
* Summary of management's future plans
If you're just starting a business you can focus on explaining the market, the pros and cons and what sets your company apart from other companies. You should basically convince investors that your company has what it takes to compete successfully and that their investment will gain substantial returns.
III. Organization & Management
Important ownership information that should be incorporated into your business plan includes:
* Names of owners
* Percentage ownership
* Extent of involvement with the company
* Forms of ownership (common stock etc)
The strength of any organization lay in the capabilities of its people. You should make certain that you clearly identify who does what in your organization. Management profiles should include some background information on board members as well as the responsibilities of the management team.
If possible you should include resumes of those involved in the company.
* Name
* Position
* Primary responsibilities and authority
* Education
* Unique experience and skills
* Prior employment
* Special skills
* Past track record
* Industry recognition
* Community involvement
* Number of years with company
* Compensation basis and levels
If you are running the business yourself make sure you identify your strengths and how you plan to handle growth. In essence if you are planning to operate the business yourself then you must understand that your business plan will need to sell your business idea and more importantly, you capabilities.
IV. Business Description
In this section you should:
1. Describe the nature of your business and explain the needs that you intend to satisfy in the marketplace.
2. Identify the individuals and businesses that will purchase your products and/or services and how you will reach them.
3. Explain how you are different or better than other companies providing the same products and/or services.
V. Market Analysis
Effective marketing is essential to the success of any business. Although marketing strategies vary and in most cases evolve over time it would not be as important to detail any one specific strategy, rather you should, demonstrate your understanding of the various methods to identify and create your customers.
Your Marketing Strategy should include:
* Market penetration strategy
* Strategy for growing your business.
* Channels of distribution strategy.
* Communication strategy or basically.
Your Overall Sales Strategy should include detailed information on how you plan to execute your sales initiatives. Include some key selling points and the resources that will be utilized such as sales representatives, affiliate programs and methods.
VI. Service or Product Line
Describe your products and services and identify how your products or service will address the needs of your customers.
Include product life cycle, research and development and also include any information regarding patents and trade secrets that you feel are appropriate (if necessary).
VII. Financial Information
Detail your assets and liabilities. Include information regarding company investments and funding required. Also describe how funds will be dispersed (including funds not yet secured).
Business Plan Outline
A business plan will include some general information regarding:
* The product or service.
* The target market.
* Marketing strategy.
* Available resources.
More detailed information would include:
* The current demand for the particular products or services that your company will be providing.
* Competitive analysis and the reasons why potential customers would buy from your company.
* Budget forecasts for proposed marketing initiatives and prospective return on investment.
* Assets and liabilities including available funds and projected investments if applicable.
This information will help you to assess whether or not the company can be successful and make some predictions as to how long it may take to become profitable.
General components of a successful business plan will include:
1. Table of Contents
2. Executive Summary
3. Management Structure
4. Business Description
5. Market Analysis & Sales Initiatives
6. Products & Services
7. Financial Information
8. Appendices
I. Table Of Contents
The table of contents is basically a reference to all of the sections contained in the business plan.
II. Executive Summary
The executive summary is a very important section of your business plan. It is basically the part of the plan that should capture the attention of the reader. In the executive summary you will present the company as it exists today, the history and the future projections of the company and how it is expected to grow.
It may make sense to write the executive summary last since it is basically a summary of your business plan, unless you already have a clear overview of your plans and are capable of presenting it in a clear and concise manner to your reader.
Contents of the Executive Summary
* The Mission Statement - A short explanation of your business initiatives.
* Start Date
* Name founders and their functions
* Number of employees
* Location of business
* Description of facilities/offices
* Products manufactured/services rendered
* Banking relationships and information regarding current investors
* Summary of company growth and development
* Summary of management's future plans
If you're just starting a business you can focus on explaining the market, the pros and cons and what sets your company apart from other companies. You should basically convince investors that your company has what it takes to compete successfully and that their investment will gain substantial returns.
III. Organization & Management
Important ownership information that should be incorporated into your business plan includes:
* Names of owners
* Percentage ownership
* Extent of involvement with the company
* Forms of ownership (common stock etc)
The strength of any organization lay in the capabilities of its people. You should make certain that you clearly identify who does what in your organization. Management profiles should include some background information on board members as well as the responsibilities of the management team.
If possible you should include resumes of those involved in the company.
* Name
* Position
* Primary responsibilities and authority
* Education
* Unique experience and skills
* Prior employment
* Special skills
* Past track record
* Industry recognition
* Community involvement
* Number of years with company
* Compensation basis and levels
If you are running the business yourself make sure you identify your strengths and how you plan to handle growth. In essence if you are planning to operate the business yourself then you must understand that your business plan will need to sell your business idea and more importantly, you capabilities.
IV. Business Description
In this section you should:
1. Describe the nature of your business and explain the needs that you intend to satisfy in the marketplace.
2. Identify the individuals and businesses that will purchase your products and/or services and how you will reach them.
3. Explain how you are different or better than other companies providing the same products and/or services.
V. Market Analysis
Effective marketing is essential to the success of any business. Although marketing strategies vary and in most cases evolve over time it would not be as important to detail any one specific strategy, rather you should, demonstrate your understanding of the various methods to identify and create your customers.
Your Marketing Strategy should include:
* Market penetration strategy
* Strategy for growing your business.
* Channels of distribution strategy.
* Communication strategy or basically.
Your Overall Sales Strategy should include detailed information on how you plan to execute your sales initiatives. Include some key selling points and the resources that will be utilized such as sales representatives, affiliate programs and methods.
VI. Service or Product Line
Describe your products and services and identify how your products or service will address the needs of your customers.
Include product life cycle, research and development and also include any information regarding patents and trade secrets that you feel are appropriate (if necessary).
VII. Financial Information
Detail your assets and liabilities. Include information regarding company investments and funding required. Also describe how funds will be dispersed (including funds not yet secured).
Tuesday, January 13, 2009
Managing Your Ecommerce Website
For the average individual, it is pretty easy to start an ecommerce website, the hard part is making it last. As with most businesses, success in ecommerce requires having a desirable product at a competitive price, efficient means of delivery, a successful marketing strategy and the capital to bring it all up to speed.
If any one of these elements are missing or lacking then the business may be in jeopardy before it even gets out of the front gates. Let's assume that the product is extremely desirable. Now all that needs to be worked out is a way to let everyone know about the product and a way to get the product to the customer. Which brings us to the last element, capital. Unfortunately, you could be slightly lagging in all departments and still manage to generate some business, but if you are lacking in capital then you will find it extremely difficult to succeed.
Having substantial capital can help a business get off the ground by simply providing the time necessary to test the market and make the necessary adjustments needed to insure profitability. If an ecommerce business does not have the capital to do this then all other elements need to be extremely appealing and effective.
The product would need to be in heavy demand, the overhead extremely low and the marketing highly effective, the business would basically need to be profitable right from the start.
In essence if you don't have the capital to sustain a business, and yourseld, until you can generate enough then you may have to make some adjustments. As an individual, you may actually be able to get an ecommerce business off the ground even if you don't have much capital to begin with. The key would be to start small, start your new ecommerce business as a hobby, something you do after work or on weekends.
Steps to starting an ecommerce business
First familiarize yourself with your products, if you haven't already done so. Research what it would cost to get your product into the homes of your potential customers. Remember that you can market exclusively to particular regions and states with a Google Adwords account. Make a note of who you want to sell to and what it would cost to ship the products. You could start wth a single state that you think you could generate the most sales from.
Now that you know who you are selling to and what it costs to send products out you can figure out how to market appropriately. Once you have created your banners and slogans or catch phrases suited for your particular demographics then it is time to calculate costs. You can use the tools that come with Google's Adwords or Yahoo Search Marketing campaigns to calculate projected advertising costs. Find out how much your competition is bidding for your keywords. If you are not sure what keywords to use, then use the tools that come with the campaigns. A pretty good strategy would be to use brand names if applicable and model numbers, otherwise try to be as specific as possible without getting too narrow as you might loose out on some search result opportunities, for example if you plan on selling custom motorcycle helmets then you can bid on the keyword "custom motorcycle helmets" and it might be cheaper but you may lose out on folk who would like custom motorcycle helmets but happened to search for just motorcycle helmets. Naturally however, if you are on a budge then you can start off with only bidding on "custom motorcycle helmets" as it is a more targeted audience.
Once you have set up your keywords and campaign then you will start to understand the effectiveness of your campaign. How many clicks and visits does it take to get one conversion? This number represents your ROI. Your return on investment, basically how much money do you need to spend to get 1 paying customer? Once you have been able to calculate this number then you can calculate how long you business can sustain itself. If it costs you more to get a customer than you make then you are obviously losing money.
If you think that you can improve your ROI by adjusting your marketing strategy then do so, but remember that you should allow a campaign to run for a substantial amount of time, perhaps a month or two so that you can more accurately assess trends and have more data to work with. Sometimes the problem may not be with the marketing or PPC campaign, check the website for usability issues. Can a customer easily navigate the website and find the products they are looking for? Can they easily check out?
Some questions to ask and data to look for if you are experiencing a low ROI.
If your ecommerce website starts off with a low ROI and you simply cannot find any trends that would account for this then you may need to reconsider your product, is it really appealing? Are others selling the same or similar products successfully? You can get these answers by conducting some market research and if you find that others are successful you may want to carefully examine what it is they are doing, although, you might have probably done this initially, revisit the task and see if anything has changed.
A low ROI does not always mean, however, that your ecommerce business is doomed. Sometimes a new ecommerce website need time to create a presence. You may find that some potential customers may come back to purchase weeks after visiting your website, you may also enjoy repeat clients after some time and in addition to new business trickling in, you can experience growth, slowly but surely.
Not all ecommerce business will start off as highly profitable ventures, in fact many will fail under poor management, bad product, or insufficient funding. The key to success is to carefully research your market and plan ahead so that you are ready for anything that may come your way. If you cannot raise capital by finding investors or partners then it may not be a bad idea to keep your day job until you start seeing substantial returns and have accumulated enough funds to keep your business and yourself going for at least a year in advance.
If any one of these elements are missing or lacking then the business may be in jeopardy before it even gets out of the front gates. Let's assume that the product is extremely desirable. Now all that needs to be worked out is a way to let everyone know about the product and a way to get the product to the customer. Which brings us to the last element, capital. Unfortunately, you could be slightly lagging in all departments and still manage to generate some business, but if you are lacking in capital then you will find it extremely difficult to succeed.
Having substantial capital can help a business get off the ground by simply providing the time necessary to test the market and make the necessary adjustments needed to insure profitability. If an ecommerce business does not have the capital to do this then all other elements need to be extremely appealing and effective.
The product would need to be in heavy demand, the overhead extremely low and the marketing highly effective, the business would basically need to be profitable right from the start.
In essence if you don't have the capital to sustain a business, and yourseld, until you can generate enough then you may have to make some adjustments. As an individual, you may actually be able to get an ecommerce business off the ground even if you don't have much capital to begin with. The key would be to start small, start your new ecommerce business as a hobby, something you do after work or on weekends.
Steps to starting an ecommerce business
First familiarize yourself with your products, if you haven't already done so. Research what it would cost to get your product into the homes of your potential customers. Remember that you can market exclusively to particular regions and states with a Google Adwords account. Make a note of who you want to sell to and what it would cost to ship the products. You could start wth a single state that you think you could generate the most sales from.
Now that you know who you are selling to and what it costs to send products out you can figure out how to market appropriately. Once you have created your banners and slogans or catch phrases suited for your particular demographics then it is time to calculate costs. You can use the tools that come with Google's Adwords or Yahoo Search Marketing campaigns to calculate projected advertising costs. Find out how much your competition is bidding for your keywords. If you are not sure what keywords to use, then use the tools that come with the campaigns. A pretty good strategy would be to use brand names if applicable and model numbers, otherwise try to be as specific as possible without getting too narrow as you might loose out on some search result opportunities, for example if you plan on selling custom motorcycle helmets then you can bid on the keyword "custom motorcycle helmets" and it might be cheaper but you may lose out on folk who would like custom motorcycle helmets but happened to search for just motorcycle helmets. Naturally however, if you are on a budge then you can start off with only bidding on "custom motorcycle helmets" as it is a more targeted audience.
Once you have set up your keywords and campaign then you will start to understand the effectiveness of your campaign. How many clicks and visits does it take to get one conversion? This number represents your ROI. Your return on investment, basically how much money do you need to spend to get 1 paying customer? Once you have been able to calculate this number then you can calculate how long you business can sustain itself. If it costs you more to get a customer than you make then you are obviously losing money.
If you think that you can improve your ROI by adjusting your marketing strategy then do so, but remember that you should allow a campaign to run for a substantial amount of time, perhaps a month or two so that you can more accurately assess trends and have more data to work with. Sometimes the problem may not be with the marketing or PPC campaign, check the website for usability issues. Can a customer easily navigate the website and find the products they are looking for? Can they easily check out?
Some questions to ask and data to look for if you are experiencing a low ROI.
- How long do visitors stay on the website?
- What pages do they visit?
- What pages do they exit from?
- Where is the traffic coming from?
- Do customers add product to a shopping cart and then abandon it?
- Are customers having problems processing payment?
- Do customers leave after getting the shipping costs?
- What ads did customers click on to get to the website?
If your ecommerce website starts off with a low ROI and you simply cannot find any trends that would account for this then you may need to reconsider your product, is it really appealing? Are others selling the same or similar products successfully? You can get these answers by conducting some market research and if you find that others are successful you may want to carefully examine what it is they are doing, although, you might have probably done this initially, revisit the task and see if anything has changed.
A low ROI does not always mean, however, that your ecommerce business is doomed. Sometimes a new ecommerce website need time to create a presence. You may find that some potential customers may come back to purchase weeks after visiting your website, you may also enjoy repeat clients after some time and in addition to new business trickling in, you can experience growth, slowly but surely.
Not all ecommerce business will start off as highly profitable ventures, in fact many will fail under poor management, bad product, or insufficient funding. The key to success is to carefully research your market and plan ahead so that you are ready for anything that may come your way. If you cannot raise capital by finding investors or partners then it may not be a bad idea to keep your day job until you start seeing substantial returns and have accumulated enough funds to keep your business and yourself going for at least a year in advance.
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