Buying Online: Business Needs a Cautious Approach A Good Internet Site Takes Money and Dedication
Bowen, David, The Independent (London, England)
Many have been tempted to set up a business online, and many more will do so in the future. But the great majority have been - and will be - disappointed.
The problem is that expectations are too great: There are 100m people on the Internet, so if only 0.1 per cent of them look at one site, that's 100,000 surfers. The parallel with selling to China ("if a billion people spend $1 each ...") is clear. As with China, this is a flawed philosophy; unless you do it right, you will fall on your face.
Be cautious, too, about the "limited downside" argument: "Well, it will only cost a few hundred to put up a site, so I can't lose much." A reasonable transactional site will cost at least pounds 5,000, and the time spent organising and running it will be (or should be) considerable.
So much for the dire warnings. There are many sites selling successfully on the Web, but they have not followed any magical formula, just a simple set of common-sense rules:
1) Find out whether your product or service is likely to sell online. According to the Irish consultancy Nua (www.nua.ie/surveys), there are 56m Americans online against 20m Europeans and 14m Asians. So if you have a product that is likely to appeal across the Atlantic, and that can be transported there easily, you should be encouraged. Anything that appeals to American nostalgia is likely to do well, as the success of the Scottish- themed Highland Trail (www.highlandtrail.com) testifies.
An even surer route to success is to be specialist. One of the hottest retailers on the Web (literally) is Hot, hot, hot, a Californian company selling a huge variety of spicy sauces. Aquatic Connection (www.aquacon.com) will sell you a shark.
The other category that can sell well is rather the opposite - standardised products that people are prepared to buy them without seeing them. These goods must also be easy to ship. The best-known examples are books. Amazon.com has revolutionised the book retailing industry by selling books online, offering a superb service and undercutting traditional players.
Even easier to ship is software, information and (just starting) digitised music, which can be sent down the line and have no physical form.
2) Set up an attractive Web site. …