Aristotle, the Greek philosopher, understood and succinctly shared insight into human learning. Especially in many areas of information technology, learning by doing is true. Striking the balance between systems and user psychology and behavior and even knowing how systems will work in particular environments can only come with doing. Also, the abstract learning environment does not often impose fiscal and organizational-culture constraints as variables and instead focuses on utopia. This is why the technology prototype is so important.
This learning is certainly proper for anything to do with the Web. Recently the Yankee Group, a research organization, estimated that billings for Web design and development work is down $10 billion annually. Reading this statistic, I was not quite sure what to make of it. Sure, many companies already have sites and are not reinventing them as often as during the dot-com boom. Still, what about the many that have not done anything?
Further incongruous is a Bizrate statistic showing that "consumer e-commerce spending last year rose 34 percent from the year earlier." Research groups Gartner and IDC have documented similar continuing growth patterns of business-to- business sales over the Internet.
Case Study. My wife's experience on the Web has allowed me to appreciate the statistics. Since starting her gourmet candy and gift basket business over two years ago, she has had an informational Web site that encouraged interested buyers to call to place orders. Then a persistent Web site designer called trying to persuade her to sell online. It was a great idea, but as we hashed out the details of a selling site, the price kept going up. The ever-increasing price coupled with the unknown likelihood of success in selling online emboldened us to find another less-risky selling alternative online.
The choice was a hosted templated solution provided by the Yahoo Store (store.yahoo.com). There are six elements of our lesson during the first 45 days of online selling with a new SimchaSweets.com. Note that while my experience was specifically with Yahoo, others are available, such as EBay and MSN.
A site can be created quickly with very low risk.
Plan out your idea and look at a turnkey templated solution. With reasonable planning, and even many products or services to sell, turn around time from inception to selling is as short as hours. On Yahoo Store, the first month is free; this can give you a real opportunity to be profitable immediately. You can attach your existing site to it just for the e-commerce piece or move the entire site to Yahoo. Finally, there are Web developers who understand the financial advantages to using a templated solution and can enhance the image with a smaller investment than starting from scratch. Referrals are available right on the Yahoo Store site. The only downside is the added cost.
Avoid reinventing the wheel
While there are opportunities to improve the online checkout experience, small and mid-size businesses do not usually have the patience and experience to invent. We are better at imitating (otherwise called Best Practices).
One of the most difficult aspects of developing the e-commerce piece of a Web site is creating the shopping and check out process. The templated approach leverages what already works elsewhere and puts it to work without extensive expertise, testing, or R&D.
Payment terms are an essential piece of online transactions. Credit cards and other payment arrangements may now be accepted on your Web site. If you do not already have a merchant account, many of the templated solutions will make one available to you.
Also, other aspects of traditional commerce are now possible. For example, creating a mechanism for advertised sales, special promotions and promotion codes (coupon management), multiple ship-tos in a single order, or handling of e-gift certificates are features that are included. Developing these from scratch can be expensive.
Cross-selling functionality, the art of recommending product B to complement product A that has already been placed in the shopping cart, is a self-promotional tool that increases the average total per invoice. Some templated solutions include this feature richness.
Finally, for a quality-oriented business, knowing how we are doing is essential. If customers are satisfied, they become testimonials. If not we know where to improve. Thus, creating a system to actually ask to be publicly graded on service can be invaluable. Yahoo-type services offer this as part of their own quality control.
Track your results
Investing in e-commerce means that you want to enhance your overall sales while not diminishing the image and quality of the customer relationship. This means that you need some tracking data, organized in a meaningful format, to know how prospects and customers come to your site and how they use it.
Like more complex Web sites, templated solutions like Yahoo can provide meaningful information about who is visiting your site, what they are searching for, and even how many pages per visit they are looking at. As with many other aspects of a templated solution, the readability of the output is critical.
Online promotion and advertising
While a hosted, templated solution like Yahoo will offer some basic inclusion on the Yahoo store based on a revenue sharing arrangement and registration with a number of regularly used search engines, advertising is still king. The ideal is to strike a balance between optimizing the Web site for search engines (free advertising) and to promote on and off the Web (mostly paid for advertising).
Two popular methods of the pay-per-click services include Overture (Overture.com) and Google (Adwords.Google.com). Pay-per-click services have different minimum usage per month (dollars) and different payment schemas (algorithms of implementation). Still, most work as auctions for specific key search words that trigger your hyperlinked ad to appear on the first page of a search engine or other context sensitive venue. The appearance or impression is not what you pay for; you pay for the click-through, when the browser actually follows the ad.
Consider live support
The biggest online purveyors of goods and services have repeatedly demonstrated higher close rates and fewer discarded shopping baskets when live support is available. A number of companies provide solutions that may be attached to your Web site through which you may provide this support. They include Humanclick.com and SiteChatter.com.
Empower your Web sites visitors with regular updates
Once a visitor has seen your site and shared his/her email addresses with permission for future email, use technology to further develop the customer relationship. ConstantContact.com provides one means of taking control of your relationship destiny and improving the average online customer annual sales.
The "dot-bomb" hastened a change in how many traditional small and mid-sized businesses looked at the Internet and its opportunity. Do not let those attitudes deter you from experimenting to find new possibilities for revenue, using some of the tools available and perfected by the dot-bomb survivors.
Read more articles by Mr. Yudkowsky.
2003 SmartPros Ltd. All Rights Reserved.
CHAIM YUDKOWSKY, CPA, is president of Byte of Success Inc., a technology consulting company specializing in helping small and mid-size business grow. He may be reached at 301-937-4555 or cyudkowsky@ByteofSuccess.com. Chaim is available to speak to your group or business on a variety of technology topics.