Here’s a Little eCommerce Secret

“HTML, Java Script, CSS, CGI, Perl, PHP…

Ahhh… technology. The hustle-bustle, the abbreviations, the wealth potential.

I can remember being in the shoes of the budding Internet Entrepreneur – the one who doesn’t program enterprise wide servers for a living. I thought to myself “ Am I going to need another degree to do this?”

Even today, the word “eCommerce” is the Buzz Phrase or Power Word used to loosely define what we all want to achieve on the Internet: “Sell Something for a Profit”.

Here’s a little secret of eCommerce: Opening an online store front was, for a long, long time, very difficult and expensive because…

…it kept people employed.

All of the web masters, programmers, graphic designers, flash animators, IT Engineers… each was needed to build and operate a traditional eCommerce store front. The expense was astronomical. I’m fortunate to know someone who works for a Fortune 100 company that was a pioneer in eCommerce. His company is huge… with an operational budget of many billions of dollars. The level of resources that his company brought to bear on their eCommerce project read like a list of Atomic Engineers. Spectacular titles, many with PhD scribbled after their names would spend hours hand coding cryptic characters into syntax editors to create a shopping environment.

He once told me the cost of one of their misadventures – Many Hundreds of Thousands of Dollars.

“Here’s the Thing”, he told me once, “The Store Front is tremendous! It looks great, it’s fast, it captures customer information, it can hold thousands of products… but it’s not working.”

So, I asked him what the problem was. He said, “It’s not making a profit”. I asked him how much revenue it would need to make to be profitable. He said, “How much money did you make this year”? It had been a very good year for me. He said “Triple That…”

Gag!!

Ultimately, that’s the problem. What my friend was soon able to take to his supervisors turns out to be the same reason that so many motivated, passionate, work-at-home hopefuls can’t quite seem to make their online efforts work…

“eCommerce is all about technology and when you want to open up an online store, you will need the technology, but that’s not your goal.”

Your goal is marketing and sales. The faces on my friend’s superiors twisted into degrees of anguish and amazement. “What the hell do we know about sales and marketing? We’re spending our money on technology!”

He replied, “My point exactly.”

People don’t seem to realize that selling successfully online is still the same process as selling successfully ANYWHERE.

- You must know where to sell it, and you find that out by observing what people are buying.

- You must know where to find your products so that you can sell them to people that are buying.

- You must know how your products benefit your customers so that they will understand why they are buying.

- You must be able to buy your products cheaply enough to make a profit.

You must serve and protect your customers after the sale so they will buy from you again!

Notice how there was not a single mention of SQL Databases, or DHTML, or Server Side Extensions?

This is how people get confused. When they start shopping for a service to host their online store, they get so carried away in the technology of it they forget that their first and most important responsibility is to get their product in front of the customer.

The truth is, the customer only wants a few things:

A Great Product at
A Great Price,
Shipped Quickly and Efficiently from,
People that they trust to spend their money with.

They couldn’t care less about how fancy your eCommerce shopping cart is; if you don’t have 3 out of the 4 things above, you have not got a chance to sell them anything. Here’s my point.You want to sell online? Then SELL online! Don’t you dare get caught up in all of that technological nonsense that web geeks tell you will make you money.

There is only one thing that will make you any money for your online store – Sales.

You want to make sales online? Figure out what people are buying and sell it to them. You want to make money online? Get your product in front of the right customers and CLOSE THE SALE!

eCommerce is just a tool. Get it setup right and leave it alone. If you want to make money online, go out and find some customers and get them to come to your “Tool.”

Ask yourself, what’s your goal online? Is it to make money, to build wealth? If it is, them why would you focus your efforts on technology? Focus your efforts on Making Money! No matter how good your technology is, unless you have customers, you will not make any money.

The quickest path to income online is to actually make a sale. All other things are secondary. Technology does not matter, so don’t chase it. You can get it already set-up with a built in customer base for less than dinner for 2 at the Outback Steak House. So, you no longer have any excuses to not sell online.

eCommerce Drop Shipping

All right, let’s say that you fall in to the 80th percentile of people whom do not have a product or service of his or her own to sell. You are in good company! And you have a lot of decisions to make. But these decisions are a little bit more fun than some of the others.

The first decision is, if you have your wish what would you sell?

I chose to sell something that I had some knowledge about.  This a key concept.  It wasn’t because it was a matter of convenience. Heck NO!  If anything, if you go to Google and type in “Sword” in the search engine there, you have about 1000 different ones to choose from.  So there was already a ton of competition.

But I have become quite the collector over the years and have learned what makes one sword different from the other. So when a potential customer comes looking for a sword, and they want to educate themselves about the different type, brands, metals, etc., I am there for them, ready with all the information that they need.

So when it comes time to buy a sword, I hope they choose me over the dude who is selling swords along with the AB-Roller and decorative soap.

It’s about being the expert in your field. Short of that, it’s having killer customer service, great prices and knowing how to reach your audience.

Lets get the most difficult part out of the way.  You need real products to sell, so let me give you a few ways to find them.

The ideal online store where you are selling a product is one where you do not have any inventory.

Most of us don’t have thousands of dollars to shell out on a pallet of products that we are not even sure are in demand.  Even if you do have that kind of money, I would caution you to not start by having a physical inventory of anything. It’s just far too risky. Until you have identified a viable marketplace and a product that the market responds to with regularity and predictability, tying up your cash by owning inventory is not smart thinking.  There is a better way.

DROP SHIPPING!

A Drop Shipper is a wholesale company or manufacturer of real products that only sell to real-legitimate business. (I.e. business that is registered with a Tax ID. Cost? About $65 depending on which state you live in). What I mean when I say “ sell to legitimate business” is this:

You take an order from your online store for a nice set of wind chimes, or maybe a power drill.  You sell your product for $70.00 plus shipping and handling.  You then contact your Drop Shipper or Drop Shippers (you can have as many as you want covering a wide range of product types).  You buy the product that you just sold online for $70.00 from your Drop Shipper for $40.00 and then the real magic happens.

The Drop Shipper sends the product directly to your customer with your company name on the packaging!

Magic.

Drop Shipping is truly wonderful.  There are literally thousands of Drop Shippers out there.  You can find just about any name brand, just about any category at just about any price point.

The Specifics:

First, you need to become a real business in order to work with a Drop Shipper.  That means you go to your local courthouse and register a business name. Then go to your local IRS office and get a Tax ID number.  This is, of course, for a sole proprietorship or partnership.  If you want to incorporate or form a LLC (Limited liability corporation) check out this site The Company Corporation. There are lots of advantages to being incorporated, including liability and asset protection, but it costs a bit more and takes more time to get started.

Once you have the all of the requisite certificates, you then contact a Drop Shipper and create a relationship with them.  They have you fill out an application, sign you up, and send you a catalog of their products from which you then sell on your website.  Some Drop Shippers may also have a website where you can go and download their images and sales material directly and put it right on your website.

The Drop Shipper sets the price that you pay….

You set the price that your customers pay…

The difference is your profit!

It’s really a great way to start an online business quickly.  You can even do it inside of a week or two if everything slips into place.

Having a relationship with a Drop Shipper is FREE! And if you look more than casually you can find some really unique products (meaning less competition for your store).

What in blazes do I sell?

The $64,000 question. When I first evaluated the vast amount of products available for me to Drop Ship, I was overwhelmed.  Visions of huge virtual shopping malls with my name on the marquee swirled around in my head. And me, swaying in my hammock counting my money…

WRONG!

Even though you will be tempted to sell absolutely everything – don’t! Know this now, you cannot compete with Amazon.com

Maybe you will someday, if the fates have blessed you and you have unlimited cash.  But if you don’t get blessed and have a fixed income – don’t worry! You will not need to compete with Amazon in order to be successful! The key for those of you that want to succeed in online retail is to specialize!  Have a boutique mentality. Not boutique as in knick-knack crap. But boutique as in niche Market.

If you have a personal passion for your Harley – Sell Harley Stuff!

Like NASCAR – SELL NASCAR STUFF!

Why? Not just because you like it, but also because you can TALK ABOUT IT!

For Example; Let’s say your hobby is Astronomy.  You know all about the Heavens and Star Gazing in particular.  USE that knowledge to help your customers make informed buying decisions.  Show them how a Refractor telescope is superior for Astrophotography than a Reflector scope.  Organize a subcategory of your telescopes into a section called “Astrophotography Ready”.

I can’t say this enough – Specialize!

Sell what you know. Especially if it’s a product that you have researched and found it to be “In Demand”.  In addition to making your store stand out vs. the competition, it also helps you zero in on your target market!  And remember, the more focused your audience is, the better conversion rate you will have when it comes time for the shopper to become a buyer.

Stay with me on this – NICHE MARKETS!

« Previous Page