Wednesday, April 21, 2010

Secrets of Online Business Success

American Pearl had been a successful jewelry store in New York City's diamond district for

almost 50 years when Eddie Bakhash took over the company from his father, Charlie, in

1997. One of Eddie's first moves was to take the brick-and-mortar company online.

Since then, he says, sales have grown yearly at a rate of 20%. Last year they surged

to almost $20 million—with 20% in person and 80% online.

Bakhash attributes some of his company's success to having a well-known and respected

store, and good word of mouth. But, he says, the key was constructing a site that builds

trust with the consumer, while educating them about the product or service offered.

"We tell the truth, showcase the product, and recreate the world that the product

comes from through a variety of rich media," says Bakhash.

If you are contemplating taking your brick-and-and mortar online, don't think you

have to set up the site yourself. Providers such as Yahoo! Stores (YHOO),

FreeMerchant, or LiteCommerce can create an online storefront that is easy

and affordable (see BusinessWeek.com, 9/05/06, "An Online Business for $3,000").

"Small businesses inherently have built their business themselves. A lot of people look

at doing everything themselves—the backend servers, all the infrastructure, learning HTML.

Whether selling products or not, you don't have to do that anymore," says Jimmy Duvall,

director of e-commerce products for Yahoo! Small Business.

Once the site is up, don't start conducting business until it's been tested and deemed ready.

Make sure all the site's features are working, since customers today expect the same good

service and quality online that they find in regular shops.

And just because the site is up, don't think your work is done. You have to update

continuously (see BusinessWeek.com, 6/8/2006 "Treating Your Web Site Like One

of Your Best Employees"). If you have outdated information, "you could be losing sales

and causing customer dissatisfaction," says Harry Hollines, vice-president for channels

and business development at Englewood (Colo.) direct marketing consultant Verio, which

also offers a service to help small businesses update their sites.

When your site is running on all cylinders, then it's time to think about traffic. Develop a

plan for generating buzz online (see BusinessWeek.com, 4/17/06 "Building Good Web Buzz")

and search engine optimization (see BusinessWeek.com, 7/6/2006,

"How SEO Upped the Revenues").

Many small businesses—almost half of those surveyed by Forrester—are also using

cross-promotions between their offline and online stores to boost sales. But while

promotions can often increase sales, don't overwhelm your loyal customers.