Prosper Newsletter: October 2007 > Ecommerce

You understand that the following information is educational in nature and is not intended to be legal, accounting, or tax advice. You are responsible for your own financial decisions and should consult your own legal, accounting, and tax advisors before making your financial decisions.

Debunking Common Myths about Web Marketing

No doubt about it—the Web is an extremely powerful, even potent tool that has not only made the world smaller, but provided an almost infinite amount of opportunities. Hence, it only makes sense that from the Internet, eCommerce took root and has exploded in popularity. With millions of people surfing the Internet each day, the potential for recruiting new customers to your online business is significant. Yet, as with any marketing campaign, there must be a strategic method of targeting customers. The challenge with online marketing is that you must compete for people's attention. In other words, it isn't enough to simply recruit visitors to your site; rather, you must convert that visitor into a customer—a returning customer. Without direct face-to-face contact, your homepage is a visitor's window into your business. And first impressions are paramount. "Within the first three seconds of a new encounter, you are evaluated even if it is just a glance," says Michelle Sterling, founder of Global Image Group. This same concept applies to marketing on the Web. Your site is a medium by which to communicate your businesses to prospective customers, and with only a short fleeting window of opportunity to grab (and keep) their attention, the way you present your business online is fundamentally crucial. You may have a revolutionary site that features the latest technology, but hits (traffic) aren't converting into sales, your eCommerce business will ultimately fail.

For beginners, here is a review of several basic—and effective—web marketing strategies:

• Conversational Marketing (or viral marketing). Participating in online forums and discussion groups, creating and maintain a blog, submitting information articles to webzines, and RSS feeds are examples of conversational marketing. The benefits of conversational marketing are an increased online presence, the ability to generate links (through RSS subscriptions, articles, discussion posts), as well as an opportunity for building credibility—establishing yourself as a subject-matter expert. For instance, if you are selling skin care products online and your blog discusses a variety of ways to maintain healthy skin during the winter months, common skin conditions, and other dermatologic-related topics, you will soon generate an audience. This, in turn, can lead to increased clientele.
• Email Marketing. Be sure that you utilize this method of online marketing ethically to avoid being known as a spammer. Sponsoring mailing lists with companies who have a broad-based subscriber base; establishing a network of sites geared toward lead generation; creating an online newsletter that is sent out via email (this is another effective method of establishing yourself as an expert and building credibility for your site)—each of these are examples of ethically utilizing email marketing as means of raising people's awareness of your site.
• Pay-Per-Click. This method of marketing can be tricky. It is not enough to simply generate traffic to your site. Using targeted keywords relevant to both your site and niche markets, you want to convert a visitor into a customer. If someone visits your site looking for UV protective sunglasses for infants and discovers that your site only sells UV protective sunglasses for adults, they will leave your site and pursue another. Therefore, you just spent money on a click in hopes to recruit a buyer but failed; that click failed to yield the kind of results the visitor expected to find on your site. As such, you not only lost money once by the fact the visitor left your site without purchasing product, but the money you spent on that pay-per-click. So, when using PPC campaigns, be sure you are choosing strategic, appropriate, and accurate keywords and phrases.
• Search Engine Optimization. Most of us have used Google or Yahoo as a means of finding a very specific product or item. We simply type what it is that we want—"Books about Queen Elizabeth I"—and hundreds (if not thousands) of queries are generated within a matter of seconds. Amid the lists of search results, however, you may discover that several sites may have tenets of information on Queen Elizabeth I, but don't actually sell books about Queen Elizabeth I. Hence, search optimization, like PPC, must be used wisely to generate credible traffic to your site. This is where excellent web content becomes particularly important, especially with regard to SEO marketing. Web content that uses important, and appropriate, keywords and phrases that are accurately representative of the products you sell helps with rankings within search popular engines.
• Affiliate Marketing. Affiliate marketing is when one Website agrees to feature buttons from another Website, and they earn a percentage of any sales generated by the other. An excellent example of how affiliate market can be mutually beneficial for both parties is as follows: a site selling a new line of organic health food wants to target moms and health educators, so they partner with The Childhood Obesity Foundation. The foundation includes the company's logo on their site as a sponsor, and for every sale generated from that site, the company will donate a percentage back to the foundation.

With this mind, online marketing is a vast and occasionally complex field to work in as technology grows and changes. Here are a few common myths about online marketing according to Seth Godin, best-selling author of Permission Marketing:

• Traffic (hits) is the best way to measure a Website. It was once though that the easiest way to measure the ability of a Website to attract visitors was by the number of hits it received. Yet, a hit is merely a single ping on your Web server. So, while your homepage might receive 1,000 hits a day, if those hits aren't translating into customers, how can that translate into an effective marketing strategy?
• If you build great content, people will return again and again. Quality web content is, indeed, important. Yet, the trick is to provide continually updated content-new and fresh content to entice customers to return. Take, for instance, the following analogy: You host an event where you tell a few jokes that induce a large, overwhelmingly positive response from audience members. Then, you invite those same audience members to the exact same event the very next day featuring the same repertoire of jokes. Some people may show up, but not many. Thus is the case with eCommerce sites. In order to build a thriving site, you need to offer news and other content-rich features (i.e., blogs, articles, headlines, polls, forums, email/RSS feeds). With more than 1.8 million commercial Websites to choose from, you need to provide people with reason to not only visit your site and purchase a product, but to return—often.
• You can sell on the Web if you invest enough in a secure server. While internet security is vitally important, as we learned in last month's edition of the Prosper Student Newsletter, commerce is not about technology. Commerce is about selling. You need a secure site to protect both yourself and your customers, but you must also focus on marketing. A good-looking, well-designed site isn't enough. You must proactively promote your site to recruit visitors, and then convert those visitors into return customers.
• The Web is like television. This is not so according to Godin. "The more you try to make web like T.V. or market it like T.V., the more you will fail," he says. Godin continues, "The combination of low bandwidth and a virtually unlimited number of choices, it's essentially impossible to build T.V.-like content on the Web that will pay off well."
• Everyone surfs the Internet. It certainly seems as though everyone is a frequenter of the Internet, constantly searching sites and looking for information, especially in our technology-saturated society. Yet, Godin reports that the average web user has visited approximately 100 sites total and has booked only about 14 of those 100 sites. "Once the initial novelty wears off, many of these sits fade away from a user's experience," Godin says. Hence, the need for new content, new product features, and other exciting content to keep visitors' interest.
• Your site should be a one-stop shop; the complete experience. Many companies have fallen prey to the fact that they can build an entire Website themselves, thus making a comprehensive site. Keep in mind, however, that your site doesn't need to be everything to everyone. Google, Yahoo, and AOL can offer a variety of services and components, but an effective eCommerce site should not lose its focus in attempt to be all-encompassing. You don't want to risk overwhelming (and even losing) your target market and, in turn, a prospective buyer.
• Anonymity is good. The web is fundamentally an anonymous medium. Yet, the Web wasn't always a hub for anonymity. Today, with hundreds of companies offering anonymous accounts, you can be anyone you want to be online—literally. Yet, anonymity can be dangerous; it can become a breeding ground for fraud. Imagine a prospective customer walking into a store wearing a ski mask saying, "I'm just looking." It seems rather suspicious, doesn't it? Anonymity online leads to spam, to one-time visitors, to the lack of marketing effectiveness, and even malicious behavior. Great online marketers entice customers to relinquish anonymity by building relationships with its customers.

ECommerce provides great promise for budding entrepreneurs, and is becoming increasingly popular among consumers. In fact, the U.S. Small Business Research Board expects eCommerce sales to increase by more than 30% in the next 12 months. With that in mind, maximize your profit potential by implementing sound online marketing practices. ECommerce is about effectively marketing and selling to your key target market, and not just raising awareness for your product or service. So, consider the advice of your coach and other internet entrepreneurs when developing an eCommerce site. The longevity of an eCommerce site is based on not only its innovation, but its profitability. Hence, online marketing has become an art in of itself.

The Five Phases of a well-constructed Website

In last month's edition, we discussed the importance of Internet security and how to build a Website that avoids the pitfalls of hackers and spammers. Now, it's time to talk about the five key elements of Website composition. As you take your business into the coming year, we want to help you begin on the right foot.

Website creation consists of five primary phases. Not all websites have all five phases, as websites are unique and constantly change. A website in the first phase may actually make more money than a website in the fifth phase. The phase that you implement will largely depend on your product offering and the type of clientele you wish to attract.

• The Skin and Bones Phase
  This phase is for websites that are about one page long. These sites typically sell one product or do one thing. An example of this would be a website dedicated to selling an eBook.
• The Basic Content Phase
  This phase is for websites that sell a series of items. There might not be a home page, but it would sell three or four products, and would be three to four pages long.
• The Official Phase
  This phase will contain a home page that links to the other pages of the website, giving it a more official feel. There may be an "About Us" page as well that describes the company and how the business got started.
• The Sticky Phase
  Sticky is a technical term that refers to a website that encourages people to stay logged on to that particular website for as long as possible. This may be accomplished through informational articles, reviews, etc. Another variable of the Sticky Phase is the ability to get the client to return to the site often. Maybe it would include a weekly article or a daily update which would encourage the client to return and visit the website often.
• The Community Phase
  In this phase, you take all the important elements of the community that is your clientele and combine them in a website. For example, you might have a "Members Only" section, or a blog. Maybe there would be a daily lecture or update, or perhaps a newsletter.

Remember, it is not necessary to move your website to a specific phase in order to generate business from your website. Many successful websites remain at the Skin and Bones Phase, and there are many people who will never want to reach the fifth phase. The Community Phase takes a lot of time to update, to produce newsletters, and to take the time to answer the questions that may come in. Find a phase that is suited to your particular needs.

There are also five different components that must go into every website:

• Domain Name
  This is the title of your website, and will start with a www., and usually end with something like .com. A domain name is also referred to as a URL, and is purchased on a yearly basis. You can purchase them for many years at a time. If you purchase your domain name from someone like www.godaddy.com, you can find domain names for around nine dollars a year, but you may be required to purchase two years. Try to buy a domain name with .com. Most people will try the .com before they try anything else.
  
  In choosing a domain name, you will want to choose something that people can easily recognize and spell. For example, if you are selling books and use the domain name www.booksforless.com, there may be confusion because the name could also be spelled www.books4less.com. Try to avoid domain names with multiple spelling or uses (or, you may also choose to purchase the domains of all the different spellings).
  
  Try to avoid having your main domain name hyphenated. Every time you recite your domain name, you will have to verbally add the hyphens. You may, however, want to buy the domain name with the hyphens in it as well.
  
  Make sure your domain name does not inadvertently spell something that you don't necessarily want to say. For example, www.booksexcellence.com doesn't sound like a problem verbally, but visually it sends a message that you don't necessarily want to convey.
• The Text Creator
  This is the most important part of the website. It may be you, or you may hire somebody else, but the creator of the text will generate the words for your website. It is the text creator's job to make the website persuasive. The ultimate responsibility for the text, however, falls on the shoulders of the next component.
• The Web Designer
  The web designer will take the text written for the website and will create a template that will be the basic overall look of the website. He will work with you to make the website aesthetically pleasing by arranging your text and adding photos. It is important to remember that somebody that knows how to design a website doesn't necessary know how to write for one.
  
  The web designer usually charges an hourly rate or a package rate for coming up with the web design. The package rate will usually start around a thousand dollars for a basic Skin and Bones website. You can find web designers on www.ebay.com or www.elance.com, and you can put up bids on their web pages.
• The Host
  The host takes your domain name and the design for your website and puts it up on the Internet. The essential thing that you need from a host is good statistic tracking capabilities. You will want to see how many people are coming to your website, the pages they are going to, and the links that they are coming from.
  
  Hosts charge anywhere from $5.00 to $75.00 a month, with $20.00 a month being the average.
• The Merchant Account
  The merchant account enables your website to be able to accept credit cards. When somebody clicks on an item from your website to purchase it, that item will go to what is called a shopping cart. The shopping cart is then connected to your merchant account, which is connected to your banking account. It functions as a line of credit which is replenished on a monthly basis.
  
  There are two different ways that a merchant account can hook up to a website. A remote shopping cart allows the client to check out and pay for the items in their shopping cart while on the website that belongs to the merchant account. The merchant account would take responsibility for the security of the transaction. A fully integrated shopping cart would allow the whole check out process to be located on your website. You have responsibility for the security, but the whole transaction will appear smooth and seamless to your customer.
  
  Both the merchant account and the shopping cart will have a monthly fee. When you sign up for a merchant account, you will usually get a package that includes both fees in one. The fees can be anywhere from $30.00 to $80.00 a month. There will also be a transaction fee where you will have to pay the merchant account the first $0.35 to $0.60 of each transaction, plus two percent of the entire sale.
• The Auto Responder
  The auto responder sends out a number of predetermined emails at predetermined times. For example, if you go to a website that offers a free excerpt of the book they are selling and you enter your email address, you will receive emails in return. You can control when the emails are sent. For example, if you send the excerpt of the book to the client, two to three days later you might send an email offering a discount on the entire book. The next email might contain another offer for another excerpt of a different book.

It may be intimidating to think about creating an information product from scratch such as an eBook. Yet, fear not! It is not necessary for you to be an expert writer. You may not even be an expert with the product you wish to market. Yet, even if you are a talented writer and an expert with your product, you might not have a lot of time to develop your product. Regardless, eBooks are a great way to promote yourself and your product. Here are a few tips to help you get started with your own eBook today.

Make Your Own eBook

To make your own eBook, follow these three steps:

1. Type and edit your book with Microsoft Word or with some other word processor.
2. Convert your document to an Adobe Acrobat PDF file. Go to http://createpdf.adobe.com, then sign up for their free trial service, which allows you five free sessions. This way you can create five different books for free.
3. After your book is converted to a PDF file, upload it to your website.

Have Your eBook Created for You

There is a website - www.elance.com - where you may hire professional writers and website designers. Once you visit the site, scroll down the screen to see what Elance has to offer. Click on the Writing and Translation link to display the different types of writing tasks that you may want for your business. On the next page, you can click on Post Your Project (for free) to obtain proposals for your project. You can also click on the eBook link under the Creative Writing heading. Either way, you will be able to post your project for bid to professionals who will research and/or write your e-book for you.

When posting a project at Elance, be very specific and make sure you state that you need a downloadable eBook, as opposed to a regular book. You may say something to the effect of "I need an instructional eBook explaining how to (explain your product idea)." I will provide the parameters (outline), but you will perform the research for the project." State that you will need the project completed within a certain time frame (i.e. two weeks). Again, be very specific. Then, choose how long your post will run (we recommend at least two weeks).

Check your posting periodically to view bids for your project. A handful of bidders will post a response to your original description. They will provide a proposal for your project. They may state how they are the best for the job, followed with a price bid. Compare the bids. Pick the one you want, and your product is well on its way to being professionally created. Elance comes highly recommended by many former Prosper students.

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Prosper welcomes your feedback. Do you have a suggestion for a topic you would like us to address in the next edition of the monthly newsletter, or an idea for a great elective class webinar? Send us an email at newsletter@prosperlearning.com

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