eStoreOpoly Coming March 23 2010

eCommerce Mistakes Over The Years

This is a reprint of an article I wrote for The Net Effect.

We all make mistakes. Whether it’s because we’re beginners who don’t know any better or we’re experienced storeowners having a “dumb moment” – it happens to everyone.

Of course you always learn from your mistakes but isn’t it so much better to learn from others so you don’t have to suffer the stress and/or profit loss to gain the knowledge? Absolutely. So here are my big eCommerce mistakes – we’ll start simple and go from there.

Some of these really are like duh… if you’ve made any of the same you can laugh along with me if you haven’t you can go right ahead and laugh at me while making a mental note not to do it yourself.

Whoops #1

The first order I ever received was paid through PayPal. It was simple; I got the order notification followed almost immediately by the PayPal payment receipt. It was awesome; I was on top of the world! Previous to store ownership I had sold on eBay and everyone paid me through PayPal, it worked the same way.

The second order was paid via credit card and so was authorized for the order amount… but not automatically charged. Since I had never had a merchant account or payment gateway and in all my store building excitement I set them up but didn’t bother to learn anything about them, I didn’t realize I had to charge the card myself.

I lost $200 on that sale and only realized it when I went to look in the backend to figure out how to do a refund.  I noticed it hadn’t been charged and the authorization had run out two days before.

Lesson learned, be sure you know how your gateway works or you may not be charging for your products.

Whoops #2

About eight months into the life of A2 Armory I got an email from one of my vendors about a new Braveheart Replica Sword they just started carrying. The price was low and the sword was hot! I immediately added it to the store, created an eye-catching ad for the home page, sent out a newsletter, and put a banner ad on a bunch of ezine type sites (they were still worth something then) – all without considering how many other stores were doing the same thing or the stock my vendor had.

I was able to fill two orders, the rest turned into irate customers who didn’t want to wait six weeks for the next shipment. Not fun.

Lesson learned, always check stock before running a big promotion.

Whoops #3

Finding a new vendor is exciting… all the new products and sales possibilities always put a smile on my face. But I don’t let myself get caught up and forget to make sure I know the vendor’s policies.

I once found a vendor with an awesome line of daggers and swords. I read all their sales literature and it seemed straightforward and acceptable. I added a bunch of their products to my site and since it was well-established orders for the new products started coming in right away. So far the new product line was performing exactly as planned.

I placed the first few orders and received an email from the vendor saying, “None of the orders placed meet the minimum order requirement for drop shipping and so would all be cancelled.”

Wait, what?

So I get on the phone, fighting to keep my cool, to find out what is going on. Apparently the sales literature was incorrect and the drop ship minimum is $100. Each of the items I’d added cost me less than $40 – I couldn’t sell their products unless I packaged them together. All the yelling was for naught, they wouldn’t budge. So I ended up cancelling the orders and dealing with disappointed customers.

Lesson learned, don’t assume anything about your vendor or their policies. Double check everything – at worst you spend a little extra time on the phone, at best you save yourself hassle and upset customers.

Whoops #4

A customer calls wondering what the charge from A2 Armory is on their credit card. I tell them who we are and what we sell and the customer says okay, he doesn’t remember ordering anything but he would sort it out. I say to please let me know if he has any more questions or needs more info about the order.

A few days later I receive a chargeback in the mail describing the order as fraudulent. I have no record of my phone call to send to the credit card company and the package has already shipped. The best I can do is refute the chargeback with my AVS information and the shipment tracking number, usually not enough for this type of chargeback.

I call the customer and get no response, same when I email. I ask that he please either refuse delivery or send the package back so I at least get the product back. I follow up my original chargeback case with a letter explaining that the product had already shipped and the customer was not responding to my emails for it to be returned, hoping they would see that something was amiss. No good, judgment in his favor and I never heard from him again.

Lesson learned, handle all customer issues yourself. Don’t rely on your customer to fix it, do the right thing, or even understand what’s going on. Once you relinquish control it’s hard to get it back again.

Whoops #5

There are problem customers who argue about restocking fees and return shipping then there are problem customers who threaten and/or waste huge amounts of your time.

I once had a customer who I’ll call Logan who fit into the second group. His first order from me was for a full armor breastplate and spaulders. He wrote me an email to tell me how excited he was to be getting his first real piece of armor and how he couldn’t wait to wear it, etc. It was nice – I like getting customer feedback.

After he received it I got another email. This one extremely hostile in tone saying the armor had cut him and was unsafe and if I didn’t take it back for a full refund I was going to be hearing from his lawyer. Whoa. I wrote back asking how he had put it on. After all the armor wasn’t sharp and if it was worn over something (as it is supposed to be) it would be very hard to cut yourself with. The response was more threats so I refunded him and paid for the armor to be returned.

A month later I got another order from Logan. It was for a sword and it was followed by an email asking if the blade was sharpened. I responded saying, “No, the blade is not sharpened but could still be considered sharp. Was he sure he wanted it.” The answer was yes, he was thrilled about the sword, he went on to say how beautiful it was and he was going to use it for display. Okay… I sent it.

Another nasty email asking if I knew what the word sharp meant. Once again my product was too dangerous and if I didn’t pay for it to be returned I was going to be in big trouble. I sent a semi-terse email back suggesting that Logan was handling the sword incorrectly and I would pay for the return again but he was no longer allowed to order from A2 Armory.

The next month Logan ordered again. This time he didn’t even get the chance to send an email about how excited he was. I cancelled his order immediately. He still tries to place orders from time to time but they are never filled.

Lesson learned, don’t deal with these problem customers – cut them off at the knees, they will only waste your time and money.

Whoops #6

A couple months after the Armory started to produce a steady income I decided to open a second store. I brainstormed, did a bunch of keyword research, and found a few drop shippers. I ultimately decided to open a store selling a line of dishware. I was meticulous about all the demand research I did and went in full force to build the store.

I had gotten everything in place – all my products, the site design, the merchant account, etc and it was ready to go. I started promoting it through paid ads and went to work getting it to rank in the natural search listings. In total I spent about two months dedicated to this store… all without looking closely enough at the supply side of the equation.

That was a major mistake. Ranking for every term related to my product line and bidding on the top spot in all the paid listings was my drop shipper. Their retail prices were too low for me to compete with, in some cases even lower than I could buy the items for.

They were unsympathetic when I called about it, saying their prices would not change. It was suggested that I concentrate on other ways of marketing like mail order or print ads and not try to compete with them. Yeah, okay, that’s ridiculous and I just wasted two months of work for absolutely nothing.

Lesson learned, do not neglect to research supply. Demand can be huge but if you can’t compete with other suppliers it won’t do you any good.

Learn from my mistakes, these are all big time and money wasters that will frustrate you and impede your forward progress.

Testimonials Please

How have I helped you?

Jaunary 31, 2010 I’m launching my first home-study-course… It’s a 12 week eCommerce Incubator designed to get your store up and profitable in 3 months. The image attached shows a game Ben and I are just now finishing creating that will accompany this launch…

Can you help us with a favor?

PLEASE TAKE A COUPLE MINUTES to really help Ben and I out! Your testimonials are what allow us to tell others that I provide valuable teaching.

To thank you for your testimonials, I’ll be choosing a random winner to receive a free replica flintlock pistol. This is one of the pistols I sell at A2 Armory, one of my eCommerce stores.

The winning comment number will be announced this Friday – January 22nd – at Midnight EST here on the blog.

THANK YOU for your testimonials!

3 kinds of testimonials, please pick whichever one resonates with you

1) Specific increase testimonial
“Audrey’s eCommerce Incubator increased my business from ___ to ____ …
This could be dollar amounts, traffic or any specific measurable result you can help us brag with

2) General recommendation testimonial
“I recommend Audrey Kerwood because…

3) Transformative testimonial
“Audrey’s teaching taught me to see X when I was seeing Y… and this helped me to ____
This is usually how I got somebody unstuck or really turned on their profits

Write from the heart… don’t worry about editing or anything. We’re grateful for your willingness to support us in public through your testimonial!

To your continued success,
Audrey

Join the eCommerce Catalyst Community

Who else wants a weekly eCommerce Catalyst with Audrey Kerwood?

I can only coach PROFIT-MINDED PEOPLE WHO CRAVE WEEKLY DIRECT Live Interaction WITH THEIR INSTRUCTOR… And, who are motivated enough by making more that they have a track-record of…

1) Implementing on their own EVERY WEEK,

2) Being able to follow step-by-step instructions, and

3) Asking questions if you get stuck in a weekly Q&A.

This is access like you’ve never had before.

eCommerce Catalyst LIVE
Weekly Class => Mondays 3pm Eastern
Weekly Q&A => Wednesdays 3pm Eastern
REPLAYS ARE IMMEDIATE & ONGOING
Weekly 7-Person Peer Mastermind (TBD by Group)

Listen to Ben Mack and I discuss Mindset: eCommerce vs. Internet Marketing by clicking play on the audio player below.

eCommerce Catalyst Mastermind Partners Wanted

Who else wants a weekly eCommerce Catalyst with Audrey Kerwood?

I can only coach 7 directly. I need 7 Bad Ass students who are ready to implement quickly. That’s the BAD ASS OFFER below, FOR BAD ASS PROFIT-MINDED PEOPLE WHO CRAVE WEEKLY PERSONAL MASTERMINDING AND ARE WILLING TO COMMIT TO 15+ HOURS A WEEK OF FOCUSED IMPLEMENTATION of MY INSTRUCTION.

There is a lighter version, where you go at your own pace… FOR PROFIT-MINDED PEOPLE WHO CRAVE WEEKLY DIRECT CONTACT WITH THEIR INSTRUCTOR… And, who are motivated enough by making more that they have a track-record in being able to follow step-by-step instructions that are well written and supported in weekly Q&A.

This is access like you’ve never had before.

eCommerce Catalyst
Weekly Classes, Q&A + MM
7-Person Peer Mastermind
$20 7 Day Trial, then $97 each Month

Weekly Classes + Q&A eCommerce Catalyst
Audrey Kerwood Personal Mastermind
YOU MUST BE A BAD ASS!
$197 each month + Other Biz Expenses
YOUR SUCCESS STORY IS MY PRODUCT!
3-Months Total… Must be willing to document
PROGESS AND ALLOW ME USE OF DOCS.

Branding and eCommerce Teleseminar

Hey hey my eCommerce friends, I want to invite you all to join branding expert Ben Mack and myself for a Branding and eCommerce teleseminar.

I will be talking about the top three ways to make your customers adore your store and increase your overall conversion. Whether you entice them to buy when they order or make them fall in love so they keep coming back these conversion tactics will increase your sales and customer retention.

You don’t need to be an expert, you don’t need to be a technical genius, you don’t even need to spend a lot of time. These conversion tweaks are not hard but they are important. So join Ben and I Wednesday night at 9pm EST at http://www.andsoitis.me, we’ll have a good time and you’ll come away with money-making ideas that are simple to implement.

If you’re sick of saying ” I don’t know where to start” or tired of “not making enough” for all the effort your put into your business, this is a call you won’t want to miss.

StomperNet eCommerce Simplified Webinar

Tonight at 8pm EST Todd Chism and I will be hosting a free eCommerce webinar!

We’re going to be sharing proven ways to easily build and grow your eCommerce store. And when I say proven, I’m not talking theory – these are things we do in our own eCommerce stores that you will be able to put into action immediately.

If you know me at all then you know I like to talk action, you can get theory anywhere. You can take what I tell you, apply it directly to your store, and start seeing results right away. I believe in keeping it simple – do this and this will happen. So join us tonight – for free!

http://budurl.com/StomperCommerce

9/09/09

Many of you know that I am one of the faculty members at StomperNet and many of you have heard about the “something” that will be happening on 9/09/09 at 9:09:09 am. And if you haven’t you can check it out here: StomperNet 9/09/09. Oh yes, it is exciting.

Now I’m certainly not going to give anything away but I do want to let you eCommerce people know that I am involved. There is going to be a lot more eComm-centric stuff going on with StomperNet and I am going to be there for you!

If you’re already a member, I am going to be doing my first Faculty Office Hours call next Wednesday at 8pm EST. Hop on and let’s talk shop(ping), I love it and am excited to be working more closely with all of you.

I’m still working on my post about Live 8. It was such an awesome time I’m finding it hard to articulate but it will be posted in a few days. I met a lot of eComm people there – some who I’ve known online for years and others I talked to for the first time. I took your suggestions to heart and am working with Brad and the rest of the staff to make StomperNet more eCommerce friendly. I think you’re going to love it.

Diversifying Your eCommerce Business

“Don’t put all of your eggs in one basket!”

This is more of a long term success key than anything else, but it is very important. I would rather have 5 niche businesses that make me $1,000 each every month than one business that makes me $5,000 every month. Why?

Consider this:  It’s easier, and for some people more realistic, to create a business that only makes $1,000 a month.  I mean, if you sell 20 things through one store each month that make you $50.00 profit – you’re there! That’s less than one sale per day. If we sell one item every other day that makes us a profit of $60.00, how much time are we spending filling orders with our drop shippers? 10 minutes every other day?

It’s simply easier to create little businesses that generate modest profits than it is to create a mega-monster business that you and your family will live and / or starve by. Think about it!  You only need to do this one business at a time.

The real genius of this business model is that you will always have one of your businesses generating money in the marketplace.  Yeah, maybe one of them takes a downturn and your sales get cut to shreds. So what?! It happens, even to the masters! They simply get back up after the impact and create another revenue stream.  If you have 4 other little business plugging along, you’re less likely to get hurt by a server outage, a market correction, a drop shipper flub, a merchant account error or any one of a hundred things that could crop up.

Diversify!

I own and operate 4 online stores. They have their slow and busy months. Sometimes they coincide, but most of the time one or two of the stores are in their “busy season” while the others are just bringing in regular sales. This way I’m making consistent profit all year long and I don’t have to worry as much about a market change because the chances that all four of my markets will change at the same time are extremely low.

Diversification is smart for business and your personal mental state.

Need Versus Want – Product Perception

As an ecommerce storeowner, heck as anyone who sells anything online, how can you shield yourself from the nimble hands of Internet price shoppers?

If I asked you to tell me how much a low priced color scanner goes for online, could you? If you couldn’t, how many searches would it take for you to get that price? Two? Yep. If you spelled “Scanner” wrong on the first try.

Now, if I asked you to tell me how much a Battle Ready Shirt Of Chain Mail would cost…

How about a Replica Tiffany Lamp? A Novelty Pool Cue? A Life-Size Cardboard Movie Standee From Lord Of The Rings? A Mutual Fund Investment System? A Hello Kitty EZ-Bake Oven?

My point is, the products mentioned above have “I Want It” value. Their price is not restricted or encumbered by a model number.  They can’t be easily compared in the marketplace because they are not staple products. They are passion buys.

You want a Life-Size cardboard Darth Vader to greet your house guests? How much is that worth to the person who’s license plate says Jedi?

NASCAR Fan? Oh wait – Are you a Pool Shootin’ NASCAR Fan? How much is that Rusty Wallace Billiard cue with the Mother of Pearl Inlay worth? The answer? Whatever your willing to pay for it.

Let’s face it, everything computer, Internet, electronic, and anything else with a plug or a model number already has a manufacturer screaming it’s value to the marketplace. If you sell these types of products, you’re saddled with shoppers who are going to compare “Apples to Apples” and the reach of the Internet makes it easy for them to do that.

That’s not to say that a shopper who is dying to get their hands on a Battle Ready Chain Mail Shirt will not already have done their research. They absolutely will, but because Sony has not yet released a Chain Mail Shirt Model, you can use carefully crafted product listings to build a high perception of value for that product.

Your success in ecommerce depends on your ability to market and sell a product that has a high perceived value to your customer, not a value that is determined by the marketplace. Isn’t it amazing how much an avid sport fisher will spend on a lure that measures 2 inches by 3 inches? Yet, they will never buy a microwave oven unless it’s on sale at BestBuy.

Need vs. Want. That is your key to ecommerce success. We already know that the best chance for a 1 or 2 person ecommerce shop to succeed is to specialize, to stay in the niche markets. Now, take that a step further. Instead of selling a product that you think a customer needs, sell them a product that they “WANT”.

Your customers buy based on emotion, and then back up their purchase decisions with logic. Yes, you should sell them something that they are crazy about, but then keep the sale alive by offering good customer service, a great guarantee, an easy way to contact you, and a fair price for a product that satisfies their passion.

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