Key factors to sell online for real
The words “for real” in the title are not misleading. It is intended as a reality check. Something not often said because what most people easily buy is supposedly quick and easy: to lose weight without diet or exercise in two weeks and learn a foreign language without studying …
It is often spread the idea that it is very easy to launch an online store: installed in minutes, Paypal configured as payment method and orders start to arrive out of the blue … the truth is that to reach that happy ending, a lot of preliminary and constant work must be done and you must take into account at least:
-Basic Business Plan
- Store features and functionalities
- Logistic management
- Customer Service
-Law compliance
And of course, it is advisable to know how search engines and social networks work and it is essential to have a marketing plan describing what actions can be done to promote my online store, that is, make it visible in front of the hundreds, thousands of stores that are selling the same product.
Before building an online store you should be able to answer these questions:
-What will I sell?
-How will I sell?
-Who do I need to sell?
-What should the store offer?
-How do I set up the store?
-What should I do?
-How to use social networks?
-What legislation affects me?
#onlineshop4real
(below you can read chapter 1 from my book“Key factors to sell online for real”)
1. WHAT TO SELL?
“The best way to predict the future is to create it.” (Peter F. Drucker)
1.1 A bit of context
E-commerce study B2C 2010: Homes and Citizens[1] (2010) published by ONTSI[2] analyzed habits, consumption and ratings on electronic commerce, as well as barriers that limit access to this sales channel is analyzed, the data only in Spain we had more than 23 million regular Internet users of which was obtained nearly 9 million bought online.
That was in 2010, now the figure has risen to more than 15 million shoppers online according to INE[3] , that is, more than 31% of the population, according to a recent study of e-commerce giant Rakuten, the expected growth in turnover is 18%, reaching in 2016, the turnover of 30.000 million …
It sounds good, doesn’t it? Although it is a small number compared to the indicators of UK or Germany if we talk about Europe, and we seem much smaller if we go to America but to start somewhere and e-commerce figures grow each year.
It is estimated that in the next five years the European market for Internet shoppers reach 174 million people, and they will spend an average of 1,500 per year (the annual average spending per buyer is around € 800 to € 1243 -in front UK) and the tourism and leisure activities account for the majority of purchases).
Besides the so-called m-commerce, e-commerce made through mobile devices is growing and evolving every day, as a logical consequence of the increase in terminals and the change in the Internet-access device getting some forecasts say it will multiply almost spending for 5 m-commerce.
Moreover, Spanish is the third language of the Internet, representing 10% of the 113 million Internet users.
Most sold products are (not much change in recent years):
Electronics
Clothing
Books
Tourist services (tickets and accommodation)
Finally, another thing to value more: users buy more at online stores also have a physical establishment: 55.2% vs. 44.7% of shops selling exclusively on the Internet (Source: Network study. it is in 2007).
1.2. What should I sell to achieve success?
You have to identify a product with little competition or that despite having much generically (eg shirts), to offer a different aspect (eg shirts with ragged sleeves), added value (eg reversible) or associated services (eg free advice on washing and ironing shirts) as paraphrasing guru Guy Kawasaki[4], if you cannot be chep, you must be different.
Of course, we also must know whether we have an objective potential group of buyers (target) and where they are (is he or she a regular Internet user? what social networks does he or she use?)
Is our provider also selling online?
Then make sure under what conditions you will be able to offer THEIR products, you could be faced to a channel conflict[5] where you will have no chance: you cannot compete with your provider in price or service.
1.3. How can I know the demand on the Internet?
To knnow the potential demand of our prodcut or service on the Internet, nothing as easy as using Keyword Tool by Google[6] (you only have to register in Google Adwords –it is not necessary to do a campaign to use it), you can estimate traffic regarding geographical areas, words, keyword groups, domains, etc.
For example you can ask Google:
How many visits could I get to my shop from people searching on the Internet
“ Reversible design T-shirts”?
Of course you should also do a direct seach in Google to see how many results are shown, how those shops are and check if there is nobody or few already selling that same product… on the internet being first counts for a lot (popular “first come, first served” in domain register could be also applied here: first come, first get the traffic).
Finally, try with language variations (eg original tees), synonyms (eg unique t-shirts) and translations to get a more global view of searches of that product on the internet.
Another useful tool this time to know consumer trends through the most popular searches is Google Trends[7], which was a key tool in one of the successful cases referred in the final chapter, Funidelia[8] –one of the main fancy dress shops in Europe- because it helped to identify what was the trend in fancy dresses and make their offer based on those data (Source: Muypymes[9]).
1.4. How do I do my market research?
It is usually said ideas have little value or none, because value is in the execution.
All right… but ideas can also be valued according to their economical and technical viability, potential and scalability.
For that purpose we must do a market research which gives us information about the competence, preferences and needs of the consumers, customer profile (doing it periodically can also be an important competitive advantage).
Once data are collected and interpreted, we should be able to:
- Define a product or service suitable in characteristics, price and quality, as well as its selling and distribution
- Establish realistic objectives for potential market and sales
To make a test of the success our proposal can get, we can publish a short survey online made with some of the available free tools as Google Forms[10].
We can pass the link to the survey by e-mail or Whasapp to our contacts, also asking them to forward the link to some of their contacts. In few days, we can have from a minimum of 40 registers for a sample to a few hundreds, of course depending on the number of contacts we can access directly, channel used, and the profile we want to ask.
Besides, we can view reports at any time:
These results will give us a very useful feedback from people who could be buyers of our idea, and who will give us information about what they think of the idea, whether they would be willing to pay and how much for a product or service as the one we want to offer, as well as any other infomation which can be useful to design business model and put into the Business plan, which we will deal with later.
1.5. How is competence doing?
Do you know who is ALREADY selling the same you want to sell?
If you do not find anybody you can identiy as a competitor, search again in Google…
Didn´t you find anything yet? What strange! Your make searches badly or you have really found a virgin niche… in this case consider there will probably be some legal aspect you do not know or logistic issues that make non-viable that business model.
Once you have identified competitors, there will be more than one and that is not bad, because it confirms there is a market, analyze their strong points to imitate and improve them, as well as their weaknesses to avoid them, and taking them as a possible basis for your differentiation (for example, if their delivery time is too long and there are many critics related published by clients in social networks, you can have a good point of differentiation offering a shorter delivery time).
Among the factors you must analyze and put in a spreedsheet of that Excel (yes, that one you first created for income estimation) there are:
· Web design and usability
· Price
· Differentiation
· Customer service
· Payment methods
· Opinions in social networks and forums
· Traffic estimation
· Order estimation (you can guess by order ID if you make one)
· Time they are online (you can know by how old is the domain register)
Some actions you can take to make your competence analysis:
- Make a question (time response, quality service…)
- Make an order (analize customer service, time delivey, etc.)
- Subscrite to the newsletter (analyze their communication policy, formats, campaigns…) o RSS channel.
- Follow their activity in social networks (Twitter, Facebook, G+, …)
- Set an alert in Google alerts[11] (very slow, it is not what it was) or Mention[12]
- If their shop is made with Prestashop[13] –very probable since 1 out of 4 shops are based on this software- you can know which providers they work with by simply adding “supplier.php” after the domain (ej: www.competenceshop.com/supplier.php).
1.5.1. How is their web positioning?
Is it possible to know the keywords which are getting visits to your competitors?
Know how are they marketing on search indexes?
Can you identify long-tail or niche keywords not yey exploited or with low competence?
The answer to all those questions is YES and these are the 3 tools you can use (all of them provide a big deal of information in their free version):
- SEMRush (www.semrush.com)
- Woorank (www.woorank.com)
- Open SiteExplorer (www.opensiteexplorer.org)
In this last web by MOZ company, you can obtain substitute indicators — or complementary- of Google Pagerank to classify a website: domain authority (DA) y el page authority (PA).
DA or domain authority (and its subdomains) is ranked numerically from 0 to 100 and represents the quality or credibility of a web page. It can be interpreted as a reputation index which would affect the way results are generated from searches.
PA or page authoriry is the same concept of domain authority but applied to individual pages.
It is also very useful to install a browser addon to know at any moment indicators related to the positioning of a given page (Pagerank, inner and outer link, backlinks, keyword density, etc.) as SEOquake (http://www.seoquake.com/)
One last note: to know the number of indexed pages by Google o Bing[14] , we can use the parameter “site” in advanced search (example “site:www.domaintolookinto.com”) but remember that number does not match the results actually accesible, those results are found in the so-called primary index, and to access it, the search must be ended with the operator “/&” (example: “site:www.domaintolookinto.com/&”).
[1] http://www.ontsi.red.es/hogares-ciudadanos/articles/id/4877/estudio-b2c-2010.html
[4] http://www.guykawasaki.com/
[5] http://en.wikipedia.org/wiki/Channel_conflict
[6] https://adwords.google.com/KeywordPlanner
[7] http://www.google.com/trends/
[9] http://www.muypymes.com/2014/05/12/10-empresas-espanolas-que-tambien-fueron-smallsmart
[10] http://www.google.com/forms
[11] http://www.google.com/alerts
