Starting a Second Career Online

September 4th, 2012

A reader of Starting an Online Business for Dummies wrote me over the weekend. She is a former physician who is now an empty nester. Having just sent two young women to college, this had an impact on me. She is thinking about creating a website. She wrote:

“The more I read [your book], the more work seemed involved in doing an online business right. This is a second career for me and I really don’t want to put so much time into it right now. Can you recommmend a good quality consultant that I could hire to do most of the work to realize my business concept?”

In my book, I do profile a business planner, but he’s not really a consultant. It’s not something you can farm out to someone else. You have to be very involved and committed enough to test and revise your business to improve performance. On the other hand, there are businesses to help you. My response:

“Some of the e-commerce hosting services do provide customers with advice on their business. I’ve written about a number of these in ECommerceBytes (go there and search for my name, ecommercebytes.com). Try 3DCart (www.3dcart.com). Look up that article on ECommerceBytes. They are open to answering all sorts of questions from customers and they have lots of experience with online businesses. I don’t know anyone who will tell you if your idea is “good” or not. I am worried about your comment about not wanting to put time into it. I am not sure I would even get started if you aren’t prepared to put time and effort into it. Online businesses don’t run on their own and you need to keep up with them. Think about it, and then look into 3DCart.”

In other words, find a shopping cart/e-commerce hosting service that will answer questions and give you advice. More tomorrow.

In my recent list of ways to sell online without a website, I neglected to mention Payvment. This is a full-fledged e-commerce platform designed especially to work on Facebook.

ECommerceBytes has an article today on Payvment and a new feature called polling. Polls enable sellers to instantly create polls about the kinds of products they’re selling. There’s also a “Want” button that shoppers can add to an item listed for sale. If a friend sees that you want the item, hopefully, that friend will end up buying it for you. It’s another way of integrating social media and selling–and that doesn’t involve setting up a website.

Update: I thought of one more option for making money without a website. How could I forget that I co-wrote a whole book about this?

Amazon.com,Facebook, WordPress, storefronts, and e-commerce marketplaces: These are all potential “home bases” for you online. I used to write that you had to have a website in order to make money online. And websites are still important, don’t get me wrong. But there are a lot more options available these days. Here are some examples:

eBay

This is sort of the obvious place to start an online business. You can create an eBay Store, or you can simply list dozens, hundreds, or even thousands of products on this venerable marketplace without having a formal store. eBay is great as a starting point for anyone wanting to learn how to do business online. But more and more people, turned off by its fees and cumbersome rules for sellers, are turning to other venues to find customers.

Add on to Amazon.com

Some people–booksellers in particular–sell their books by adding them to Amazon.com marketplace listings. Their products show up here:

I wrote an article on ECommerceBytes about several sellers who, to my knowledge, don’t sell through a website, but primarily through Amazon, Alibris, and ABEBooks.
Marketplaces

If you open a storefront on eCrater, Bonanza, or Webstore.com, you don’t need to create your own full-fledged website from scratch. The marketplace gives you a head start

WordPress or Another Blogging Platform

A blog can take the centerpiece of your online presence. A platform as robust as WordPress can host a blog and lots of web pages. essentially, it is a website, but one that you can update by posting on a regular basis. My Buddhist meditation group, Jewel Heart, uses WordPress for all of its website content. In fact, if there is a blog on this site it’s a very minor part of the content.

A Facebook Kiosk

Facebook is good for marketing and networking and just having fun. Some people use it for e-commerce, too. You can sell on Facebook through an online kiosk. I’ve written about her before, but Kharisma Ryantori uses her Facebook page to advertise, and sell, her jewelry designs, as shown  below.

Twitter: Sell Simp.ly

You can do more and more with Twitter. Some dedicated Tweeters advertise and sell products through the site in short and sweet sales listings. Read about it in this article on the site called Sell Simply.

The bottom line: you need a “home base”, but that doesn’t mean you need to create a website from scratch. You can grow into a website, but you don’t have to start there. Start by piggybacking onto someone else’s site, whether it’s eBay, eCrater, Facebook, or Twitter. Get used to creating sales listings and handling a few transactions. Then you can create a website with confidence–and link to your various marketplaces from it, so can you boost your SEO.

Pricing merchandise is one of the key functions for anyone who sells online, whether you have a few items for sale on eBay or Amazon, or whether you operate a full-featured store with a 1000-item catalog.

Assigning the right prices and staying competitive with those prices can be a frustrating and time-consuming proposition. You want to make a profit, so your price has to be higher than what you paid for the item you’re selling (unless, of course, you’re unloading inventory that never sold in the first place). But it needs to be either the lowest available or at least very close to the lowest when compared to your competitors.

The difference is often a matter of a few cents–or even one cent. Take a look at one of my own books, which you can find on Half.com. It’s kind of painful to look at the prices being offered when you consider that the book sold for about $24.99 retail when new. But this is an old edition and out of print.

If you can’t read this, I’ll tell you that the four prices for this brand new book are (sigh) $1.89, $1.00, $0.99, and $0.97. (You wonder why I don’t write books for a living any more?) Let’s suppose that, for some reason, you wanted to buy this particular edition of this book. Would you pay $1.89 when you can pay $1.00? Would you pay $0.99 when you can pay $0.97?

That’s the problem lots of businesses face, but on a much larger scale. I just spoke to the owner of a company in Wisconsin who has hundreds of items in his product catalog and who sells on eBay. He and his employees used to scan through listings manually and adjust prices so they were the lowest. But the manual route is extremely time-consuming.

“Even if you factor only 2 minutes per product with 200 products you’re talking about over 13 hours a day of work if you do it twice a day,” says the businessperson, who asked to remain anonymous. “Never mind the fact if you tried to pay someone to do that all day every day they would be burnt out before the first week is over.”

Once you get past 100 items in your catalog, it pays to pay a little money for a pricing tool. This sort of tool can be configured to search for items similar to yours and make sure you have the prices you want. You can tell the tool you want to be the lowest, second lowest, or third lowest. You can tell the tool to make sure your items are one cent lower in price than those of your competitors. Here are two such tools:

  • In ECommerceBytes recently, editor Ina Steiner wrote about a pricing tool for Amazon.com sellers, Teikametrics.
  • I just interviewed the developer of a pricing product for eBay called PriceSpectre.

I’ll be writing about PriceSpectre in more detail after that article comes out. The point is, no matter how much you sell, once you put your items online, keep checking prices against the competition to make sure you’re positioned correctly–especially if you are in a super competitive field like electronics, digital media, or books. Whether you do it manually or use an automated software program, you’ll end up with more sales. Even if your profit margin is a little lower than it would be otherwise, you’ll be better in the long run because you’ll have more loyal customers and hopefully more repeat business.

Banks have been getting a bad rap. They’ve also (happily) been having a lot of their ability to charge excessive fees taken from them.

At least one is looking for new opportunities by getting into e-commerce. Not by opening an eBay Store, but rather, by helping other people open online stores. Chase Bank has launched an Instant Storefront Solution, and I write about it on ECommerceBytes. If you’re looking for a merchant account that enables you to accept credit cards, this is a good way to get it. It’s based on the popular Miva merchant platform. BTW, check out the killer graphic by David Steiner that accompanies this article: “Just Add Inventory”!

Maxine Durkee, owner of the Heavy Weight Collections online store, says Chase Instant Storefront gives her site’s shopping experience a sense of security.

“Our banker was visiting our retail store during our beginning months and he mentioned that they had developed a relationship with Miva Merchant and I should take a look,” she told me. “When I checked them out, I saw that I would have lots of freedom with design and a basic starting point had already been developed if needed. They gave you a choice of a free template upon signing up and didn’t lock me into some long contract if I decided the solution wasn’t what I needed. We already had a design idea so I selected a template that was close to what we wanted to start with and we gave it a try.”

As you might expect, there are fees associated with opening a Chase storefront. The $100 setup fee is sometimes waived during promotions. And there’s a $39.95 fee for hosting. Then there are transaction fees. Sounds like Chase Bank, all right!

You may also have seen commercials for Chase offering a QuickPay product in which one person can transfer money to another person. To my surprise, there’s no fee being charged for this. It also sounds a little like the InspirePay service I wrote about recently, in which artists can get paid for their work by people who want to pay them online. InspirePayj, though, lets you set up a “Pay Me” or similar button on your website, so it’s not quite the same thing.

A reader of Starting an Online Business for Dummies asks this question, which is one everyone wonders when they’re thinking of starting an online storefront:

“In other words, how much can I expect to make and how quickly? Obviously, there are a huge number of variables to this, but from what I’ve read, there are virtually no examples given or case studies cited that offer any clue as to the bottom line. It would be helpful to know, for example, about an actual case that described someone who opened an online store, what they did, and how much they were making in how much time.”

There is no perfect answer to this, of course. No magic wand. But I would suggest that she is asking the wrong question. Here’s what she (and you, the budding businessperson) should be asking:

“What do I feel so passionate about that I will work my butt off night and day to make as many connections as I can with other people to spread the word about it?”

Note that I said CONNECTIONS rather than sales. Connections lead to sales. To be successful online these days, you need to connect with potential customers (or readers, or subscribers) through a process of triangulation. You need to combine three things:

1. Social marketing
2. One or more marketplaces
3. Your website

Everyone wants to know how much money they can make online. You need to have some rough idea if you are creating a business plan. But I’m saying that’s not the best place to start. If you make unrealistic projections and fall short, you’ll get discouraged. Look at your business from a different perspective: your talents, your interest, and your message. Find your passion and work to tell people about it every day, on Facebook, on Twitter, on your blog, and on your website.

Just so you don’t think I have nothing to say to the question directly, I’ll say this. When I opened a store on eBay, I set two goals for myself: I wanted to make $300-$400 extra spending/bill paying money per month as a short-term goal. Long-term, I wanted to become a PowerSeller. Pretty modest goals, but I made them both (though I wasn’t a PowerSeller very long). A reasonable goal, then, would to make some extra “gravy” money for fun, to pay a few bills, or to keep afloat rather than sinking into debt.

Dean Pettit, whom I have written about elsewhere in this blog as the owner of Space Coast Outdoors, is doing pretty well with his site. But he told me the following when I asked how he is doing financially:

“For the time it is helping with expenses, I hope it will grow to be a primary income with time and with what I have learned I think it will.”

There is a reasonable goal: start out wanting to make enough money to help with your day to day bills. Dean wants to make this his full-time business, to be sure. But he also started his company because he loves the outdoors in his part of Florida, he knows a lot about it, and he sees that there aren’t other sites around marketing tourism on the space coast.

On NPR recently, I heard another story about the young author Amanda Hocking. She started out selling e-books of her novels and marketing them herself because no agents or publishers would accept them. She turned out to be a marketing genius, selling through her blog, through online interviews, and by doing anything she could to make connections, to spread the word about her books. Building a platform and making connections with customers and readers leads to sales–remember? Eventually, a publisher came to Amanda, hat in hand, offering to publish her book. The story said she is now a multimillionaire. There’s a success story for you. Here’s another, about a woman named Cynthia Lizana who started a one-woman business on eBay, expanded to Amazon.com, and has hired two employees.

There are lots of inspiring success stories out there. Don’t depend on them to get you going. Look inside yourself, at what you love to do, and let the desire to connect and build up a fan base or customer base drive you. Set modest, realistic goals that you can meet, and you’ll be way more likely to meet with success than imitating someone else.

Prove Your Identity Online

January 9th, 2012

miiCard, the identity service I wrote about in a recent ECommerceBytes article, is now allowing users who signed up for the service to actually obtain their virtual identity card. In their system, identity is proven by linking to the individual’s bank account information. The idea is that a bank has already taken steps to prove you are you who say you are, so your miiCard piggybacks onto this.

Fulfillment By Amazon

July 19th, 2011

Fulfillment By Amazon (FBA) is a bigger program than I ever expected. In this program, a seller ships his or her inventory to Amazon.com’s warehouse. You pay a UPS shipping fee, and a storage fee. But when you sell something, you notify Amazon, and they do the shipping for you. You don’t have to box, label, or haul to the post office. And shipping takes place 24/7. These are not the best things about the program. The biggest benefits are:

1. Items stored in the FBA program are eligible for Free Super Saver Shipping, Amazon Prime, or other discounted shipping rates. Thus, people are more likely to choose them. And, items with discounted shipping go to the top in search results when they are tied with competing products that aren’t FBA.

2. Because of the free shipping, you can raise your price to match your competition. Even if you have the same price as someone who is not using FBA, you get at the top of the search results. And when you sell, your profit is dramatically higher.

3. You can use FBA with marketplaces other than Amazon.com. It’s a multi-channel selling tool.

E-commerce is about margin, not volume. If you make $3 on 10 sales you’re doing better than someone who makes $1 margin on 25 sales. FBA not only has a big convenience factor but it raises sellers’ margin considerably.

I just wrote an article for ECommerceBytes about FBA and talked to Chris Green about FBAPower, his FBA software site. The next few posts will be about this subject.

My article for AuctionBytes on Business Implications of Google+ has just gone online. Now I can mention it on my blog, I can tweet about it, I can post on Facebook, and of course, I could mention Google+. Wow, I need something like HootSuite to help me do all this at once.

Digital goods: That’s the opinion of Scott Silverman, former executive with Shop.org and now a co-founder of Ifeelgoods.com, a company that functions as a “digital incentives provider.” Ifeelgoods.com is currently focusing on Facebook Credits, the virtual unit of currency on Facebook. But they are also testing the use of Skype credits as incentives to make discount purchases, sign up for newsletters, download apps, or other activities. All of these things connect potential customers with businesses and increase the chances that they’ll eventually be converted into purchasers.

“For me, personally, I had been with Shop.org for 11 years, and gave me a vantage point shere I saw lot of trends developing like search and social media,” he commented in a recent interview. What gets me so excited every day about this opportunity and compelled me to leave a job that I loved was how large a market digital goods is right now and how little activity there has been to date on the part of marketers and brands taking advantage of this as a marketing vehicle.” he cites the example of Zynga the company that developed Farmville. Most people haven’t heard of Zynga. But their IPO is expected to bring in as much as 1 billion “When you actually play these games, you see how powerful they really are,” he says.

Find out more in my article about Ifeelgoods on AuctionBytes.