Before I go in to what you need to be successful, let’s define some terms.

Resources: I’ve defined resources here as the amount of time or money you have. If you are starting a part time business with a few grand in the bank, you’re starting with low resources. The more time you have and the more money/people you have, the higher your resources.

Margins: How much you make per sale. With high margins, you make a high percentage of the sale price, and vice versa for low margins.

Demand: How much pull there is for your product. E.g. The size of the market.

Competition: Who you’re up against.

You’ll notice that the first two are internal (margins are set by the market, but you have control over them), and the second two are external factors.

Combine the first two, and you’ve got your internal limitations. Combine the second two, and you’ve got the “pull” of your product.

Let me explain “pull” a little more. If you were the only outlet that sold Nike shoes in the world, you would have tremendous pull. There’s massive demand, and you would have no competition. If you were to sell no name digital camera’s in the current market, there’s not much pull at all because of the massive competition. You can find this out using the Adwords keyword tool. Be careful to be very very specific.

If you’re starting an ecommerce business, join me in this exercise.

Classify yourself from 1-10 in each one of the metrics above.

Now consider these charts.

margins-resources

demand-competition

To be successful, I believe you need to match up (or better) in both charts.

That is, if you have low resources, you need high margins and low competition.

If you have high resources, you can deal with competition as long as demand is high.

If there’s high competition, you need to have high resources, or target a specific niche of the market.

The idea of the charts is that it lines up your internal situation with your external situation.

And a quick disclaimer: In the words of someone much wiser than me “You can quote me an exception, but I’m giving you the rule”

Related posts:

1. 8 questions in an ecommerce conversation You want your online business to succeed right? The stats...
2. How I got 250% more leads 466% cheaper These aren’t just numbers that I plucked from thin air,...
3. Make sure you have a phone number on your website One of the biggest mistakes I see on e-commerce websites...

Related posts brought to you by Yet Another Related Posts Plugin.

First though, for those who don’t know what Google Wave is, it’s a new app that blends email, instant messaging and document collaboration. Rather than me explain what it is, check out this quick video about it.

When I first got into my Wave account, I was lonely! Once I added some people though it turned out to be pretty cool.

Instant Messaging

We got a 4 way instant messaging conversation going between me and some friends that I’d invited. Before using Wave, I thought that having the letters show up as you type is a bad thing because often you want to change your message half way through. What I found though was that having letters showed up made communication loads faster.

When someone else was typing in a message, I can see where they are heading with their thoughts before they send the message. If I know what they’re going to say, then I can start typing my reply before they’ve finished their message. And because it works both ways, it actually speeds up the conversation considerably.

Group Planning

I also created a Wave to plan for the family holiday coming up next year. I separated the different aspects and then people started replying in different areas of the Wave.

The Wave makes it easy to break up the conversation into multiple points.

Instead of having one long email and having to say “In regards to the location:” at the start of every paragraph, what you’re talking about is obvious based on the place it is in the wave. It’s actually quite easy to talk about where, when and how all at the same time, because each conversation is in a different area.

Collaboration

I started a Wave for one of the quotes I’m working on. For this quote, there are about 10 different items that have to be costed individually.

Again, being able to talk about each individual item separately feels nice and is intuitive.

I can quickly upload relevant files. Though I tried to upload a recording of a meeting but there is a 20mb size limit on files.

Fun

I also started mucking around with the Sudoku gadget. Basically, this allows you to play Sudoku against as many people as you want.

Not a new concept, but definitely novel to try it out.

For the record, I won.

Downsides?

There were a few downsides for me. Firstly, the interface isn’t as smooth as I would like. It feels a little bit like I need to upgrade my computer so that it’s a bit smoother.

Also, the interface isn’t as intuitive as I would’ve thought. For instance, one thing that has bugged me is that when I go into edit mode, I can’t get out of it unless I click on another Wave. There are a few little things like that.

So how will it affect productivity?

For me this is a double edged sword. There are the obvious productivity boosts – I am able to collaborate and communicate much more effectively.

However, I currently turn off all notifications on Outlook so that I’m not distracted when I’m doing a task. What if I’m doing a document in Wave, and I see a response to another Wave come in? It’s so easy to quickly check it – I know I won’t be able to stop myself from having a look.

And what happens when that Wave gracefully turns into an instant messaging conversation? I can see myself spending a lot more time “collaborating”.

My thoughts

Overall I’m really excited about using Wave. It feels much “easier” and I think Google have succeeded in bringing communication to the next level.

I have a few questions that can only be answered as time goes on and Wave actually gets used. For me, I’m interested to see how Wave will improve my workflow.

On a more macro level, I’m interested to see how much Wave is going to take over from email? Or is email and Wave going to coexist for a long time?

In the mean time, I have a few invites left, let me know if you want in!

Related posts:

1. Getting your business on the (Google) map This article is taken from the second issue of the...
2. Google Adwords Quality Score Explained One of the most commonly asked questions about Google Adwords...
3. Video calls: they’re so easy but why does nobody do it? There are so many reasons that video calls should be...

Related posts brought to you by Yet Another Related Posts Plugin.

Related posts:

1. How to reach the top in local search – Part 1 So you have a website. It’s a great looking website,...
2. How to reach the top in local search – Part 2 This article is part two of a three part series....
3. Ideas for small business in a difficult environment In yesterday’s SMH, there was a great article about “Thinking...

Related posts brought to you by Yet Another Related Posts Plugin.

Well theres a load of reasons. Here is my answer in podcast form.

Related posts:

1. Top 8 reasons you should have an effective website With so many people now using the internet to find...
2. 6 Adwords Landing Page Design Tips and an Example In a previous article I wrote about the Adwords Quality...
3. Google Adwords Quality Score Explained One of the most commonly asked questions about Google Adwords...

Related posts brought to you by Yet Another Related Posts Plugin.

People get attracted to starting an online business by the low barriers to entry (Have you ever seen those ads for “Get rich in 15 minutes per day?”) but fail to understand the marketing and resources required to launch a successful website.

My first online shop was a digital camera store called Savvy Shopper. It was a total disaster and it took me two years to realise that margins were too low, and competition was way too high. I couldn’t raise my prices because the instant I did, all of my customers went to one of my many competitors. I was stuck in a cycle I couldn’t beat without massive investment. Then throw in credit card fraud, and it was not worth it to run the business.

Since that time, I’ve worked on a number of online stores, and helped others build online stores. This post goes through four questions that a developer will ask you to find out if you’re serious about your business. Then four questions that you should ask your developer to know if you’re working with someone that is right for you.

Questions a developer will ask you

What market research have you done?

Studies have shown that patients get better results from Health Care if they research their condition than if they rely solely on their doctor for advice.

The same is true in business. You can get a web consultant to help you check out competitors, and to survey customers, but you’re better off doing it yourself.

The reason is this: everybody has a different approach to doing things. When you’re in the process of building a business, a different approach to the way things are done can make a huge difference. It’s important to have a clear dream of how the business will work while doing market research.

The two most important aspects to market research are a) customers and b) competitors.

Who are your customers? Remember it’s better to have a large chunk of a small market than a small chunk of a huge market. Aggressively segment and profile your customers.

What is your customers pain?

How competitive is the marketplace? How many competitors serve your target market already? What are your competitors strengths and weaknesses? Can you realistically compete with them?

The most important part of market research is to come out with a value proposition. A short statement that says what you do for customers, and why you do it better than others.

Why will people buy from you?

Especially if you’re entering a mature market, what makes you different that people will buy from you?

Are you selling t-shirts? There are hundreds of sites that sell t-shirts, why will people buy from you? Just because you don’t know of them, doesn’t mean they don’t exist. Do extensive searches. Use lots of different keywords for your searches. In a mature industry, there are always competitors you don’t know about yet.

If you are using your brand or your personality as the reason people will buy from you, consider how much effort and how long it takes to build a brand.

What resources do you have at your disposal? (The wider the market, the more resources required)

Who will handle customer enquiries? Who will be shipping the products out? How will you get stock?

Compare these two different scenarios.

Scenario 1: You run a 10 person manufacturing business with established sales and established procedures. You want to expand sales by selling online. You’ve got customer service people and a warehouse with a warehouse manager. You’ve got plenty of money to spend on profitable advertising.

Scenario 2: You work full time and want to sell some products on the side. You’ve got a bit of savings, but want to expand the business from profits it generates.

What leverage can you take advantage of?

You can see how having access to different resources changes the approach. In Scenario 1, the business can hit the ground running. It can build links from existing industry contacts, has staff that can add and update products, has shipping policies and procedures figured out already, and has an existing reputation and brand that can be used.

In Scenario 2, there is a lot of work to be done. The business can only be grown from profits, which won’t be much at the start. It is a lot of work for one person to build up a brand, build links, build content, add products, do customer service and send out products.

As you move up the continuum of more resources and leverage, you will be more successful. As Alan Weiss says, “You can cite me exceptions, but I’m giving you the rule”.

Questions to ask your developer

What features will the store have?

The ecommerce software market is flooded. There is a huge problem. There are a lot of ecommerce products getting peddled for $200, and people are buying them. In itself that isn’t a problem, but the problem occurs when customisation is inevitably required.

It blows my mind that one of the question’s people ask me when they want an online shop is, “How many products and categories can I have on my site?”. It goes to show the sad state of ecommerce solutions in the market. The marginal cost of having 5000 products compared to having 50 products, is negligible.

The real cost of having 5000 products as opposed to 50, is that your business is bigger and you need more features.

The most important features as you go up the scale are:

• What shipping options are there? Shipping is way more complicated than it sounds. If the products you sell vary greatly in size or shape or weight, make sure you have advanced shipping calculations or that you’re willing to eat some variance.
• Do products have options? You want the ability to set multiple sizes or multiple colours
• Can the store calculate taxes? Again, calculating tax is annoying. What’s also important is if you charge tax to some regions and not to other regions.
• What payment methods can the store accept? Do you need to be able to integrate with credit card companies?
• What is order processing like? You want to be able to set statuses for orders, and track shipments if you’re getting over one order per week.

How big is the online market?

A web developer or marketer will be able to give you an idea of the size of the market you’re entering. In a small market, you don’t want many competitors. In a big market, you want an angle or niche that you can dominate that separates you from the competition.

You can also find out the market size yourself using online tools. One good one is the Google Adwords Keyword tool.

How is the store optimized to improve sales?

Simple and clean converts better than loads of content. Easy to use will always trump “looks design-tastic”. (Design-tastic is my snide way of saying that a site has been over-designed and looks really awesome and clever but it’s actually totally useless)

The checkout process should be extremely clear and simple. Ideally you want a checkout that has been tested for conversion rates.

Something else you should keep in mind is that people are familiar with online shopping now. They know what a “cart” and a “basket” is. Stick with conventions. People expect the ecommerce experience to be a process of

• Browse categories to find the category I want
• Have a summary view of all the products
• Click on a product to get a detail view
• Add to cart
• View My Cart
• Enter their details
• Pay

You don’t want to deviate from that structure too much otherwise you run the risk of confusing customers.

Similarly, don’t use flash based ecommerce. Yeah it looks flashy, but they generally border on design-tastic and don’t act as expected. Not to mention they’re a nightmare to update, not as good with SEO, not as flexible and not as accessible.

How extensible is the website?

There are a lot of content management systems that do ecommerce, and there are a lot of ecommerce systems that will also let you have other database driven content.

When you’re planning an ecommerce site, look as far into the future as you can, and decide what other features you might need down the road. The last thing you want to happen is to be stuck on an ecommerce platform that doesn’t allow for expansion, or be stuck on a simple ecommerce platform because you needed other features in your site.

Related posts:

1. Strategies that win: How to be successful in e-commerce Starting an ecommerce business can be hard. Since I often...
2. Shoppers search online: Take advantage of emerging buying trends This article is taken from the first issue of the...
3. Make sure you have a phone number on your website One of the biggest mistakes I see on e-commerce websites...

Related posts brought to you by Yet Another Related Posts Plugin.

I realised that a lot of what I do is optimizing a web presence to achieve better results.

I’m hoping the new positioning will make it easier for people to remember me, and what I do. I’m looking forward to writing content more consistently, and to take a more focused approach to what I write about. From here on, I’ll be writing more about business and marketing and less about freelancing and issues that face web designers.

What experiences have you had rebranding yourself or your business?

Related posts:

1. My Products and Services Businesses Businesses that I own or have a stake in....
2. Human Behaviour in Search – plural vs. singular matters I’m writing this post because I read a very interesting...
3. How to reach the top in local search – Part 2 This article is part two of a three part series....

Related posts brought to you by Yet Another Related Posts Plugin.

Paypal is a massive company and takes lots of money from me, my clients, and most likely you, every day. They have no excuse for such a poor campaign, but some of the mistakes they’re making are actually very good examples of what not to do, so I’ve decided to go ahead give Paypal some free advice.

Lets see what they’ve done

So I do a search on the keyword “skydiving”, and I’m presented with this ad at position #2:

Paypal's Google Adwords Ad

This ad has some good points. The keyword is in the title, it is in Camel-case (every word beings with a capital), and has good punctuation. All good practices.

It strikes me that this ad has some things right about it, because it means that the person creating it had to know something, but (sorry Paypal) from here on in, the news is all bad.

So what’s wrong with the ad text?

1. The ad is “seller focused”
2. The ad is misleading
3. The ad doesn’t prequalify

The ad text is seller centric

When people are making a decision on whether or not to go skydiving, they don’t care about how they pay.

When people are making a decision on where to go skydiving, they don’t care how they pay.

People care about things like how fun is it? How far away is the skydiving centre? How high do I jump from? How much is it?

The last thing people think about when booking a skydive is what payment method they are going to use.

Ads should be written to offer benefits to the customer. That is what grabs their attention. That is what grabs their interest. If you want branding, you’re in the wrong medium. In search, people are searching for something. If branding is what you’re looking for, go and get banner ads. (And that’s a topic for another post)

The ad text is misleading

After looking at that ad, how much do you think skydiving costs?

$130?

$150?

$200?

It’s actually $350-$400.

The special offer, “save $30 on orders over $129″ is completely accurate, yet the qualification is completely irrelevant. In a format where you’ve got 70 characters, why waste 1/4 of them? And considering the call to action in this ad is self indulgent, the whole bottom line is wasted.

The ad creates false impressions. Despite the landing page (which we’ll see in a minute), some people are going to get to the product page and be pissed off.

Instead, why don’t Paypal draw a connection between their offer and their service.

The ad text doesn’t prequalify

The first time I looked at this ad I thought “Wow, skydives for $139, that’s amazingly and rediculously cheap. Oh… and PayPal is an option”. It didn’t click with me that you have to pay with PayPal to get the special until I actually started writing this post. Maybe that’s just me.

We already talked about how skydives actually cost $350. If you know nothing about skydiving and you have a $200 budget for fathers day, you qualify via this ad and you click it.

Paypal have effectively created false positives. False positives are a terrible thing for Adwords ads.

So what should the ad text look like?

Something like, “Pay With PayPal And Save $30″ would sit a lot easier with me. Why? Well, we do have to keep in mind that PayPal don’t want to sell only skydiving, but that buyers have to also pay by PayPal. The ad won’t sell as many skydive’s as an ad that was run by a skydiving centre, but that’s not our objective here either. We need people to pay with PayPal.

The line “Pay With PayPal And Save $30″ promotes PayPal in a way that is buyer centric. It is telling the buyer what they can get from using Paypal, rather than just telling the buyer to pay with PayPal.

The line also pre-qualifies buyers. Now people that won’t use paypal, won’t click the ad.

I have some other tips for writing Adwords Ad Text.

The landing page

I go ahead and click the ad, and get taken to this page:

Paypal-Offers.com.au landing page

There are a few things immediately wrong with this landing page.

1. Where is the skydiving info?
2. There is no skydiving info?
3. Am I in the right browser tab?
4. There is no skydiving info?
5. Yep, there’s no skydiving info
6. Wait there’s a horizontal scroll here
7. Ok I’ve scrolled all the way to the left, and there’s no skydiving info. Maybe on the right?
8. Nope nothing on the right either
9. What the hell?
10. Seriously, am I in the right browser tab?
11. Oh wait, if I scroll to the left again there’s an option labelled “Experience”, and I can see a tiny picture of a plane. Skydivers jump from planes.

I got through to number 11 because I actually wanted to see this offer, but everyone else left the site at 1.

So what’s wrong with the landing page here?

1. The landing page is 99% full of other stuff
2. The 1% that is related to skydiving is a tiny picture of a plane that you pretty much have to have jumped out of to realise it. It’s also hidden and you have to scroll sidewards to find it.
3. There is no continuity between the ad and the landing page
4. This landing page is a Quality Score nightmare
5. The page is in flash and has a loading bar

Landing pages have to continue the story

With every sales process, with every beauracratic process, with pretty much everything. If you want to be persuasive, you have to paint a picture and tell a story.

Landing pages are no different. You have to continue on from the story you started with your ad. People coming to your page should have an idea of what to expect. They want information about skydiving. They want to know where, why, how, how much, is it safe, etc.

To get the sale, all you have to do is deliver on your story.

You’ve got the customers attention, now take advantage of it. The AIDA marketing model is used to describe the stages a customer goes through when considering a purchase. It goes Attention, Interest, Desire, Action. You’ve got the customer’s attention when they came to your site. Now keep them interested and use your landing page to create Desire and Action. It’s actually pretty easy since they’re looking for what you’re offering. They just searched for you, didn’t they?

My free advice to Paypal

So my advice to PayPal is pretty simple.

Create some new ads and test them against each other. Continually improve them.

Be more specific in targeting ads. Yes, the entire campaign is a broad one. But the savings across the board will be massive if each group is optimized.

Continue the story on the landing page.

And I wouldn’t be worth anything as an optimiser if I didn’t say, “continually test and improve”.

Related posts:

1. 6 Adwords Landing Page Design Tips and an Example In a previous article I wrote about the Adwords Quality...
2. Google Adwords Quality Score Explained One of the most commonly asked questions about Google Adwords...
3. The 10 most expensive Adwords Mistakes Adwords has become the first point of call when it...

Related posts brought to you by Yet Another Related Posts Plugin.

Does a high ranking ad convert better than a low ranking ad?

According to Google, the answer is no – the rank of an ad does NOT affect conversion rates.

That’s very interesting to me because for organic search results, the rank does affect conversion rates because people trust the rankings that Google are showing.

What this new research says is that people don’t trust the ranking of Adwords ads because they know that positions can be bought.

Related posts:

1. Web based communications strategy for small business I was speaking to the owner of an internet cafe...
2. Human Behaviour in Search – plural vs. singular matters I’m writing this post because I read a very interesting...
3. Google Adwords Quality Score Explained One of the most commonly asked questions about Google Adwords...

Related posts brought to you by Yet Another Related Posts Plugin.

Once you’ve got some work, more effort should go into streamlining your business processes so that you can handle even more.

When my business first started growing, I was spending a lot of time on the business and not doing work. In fact, I think this happens to all freelancers. The sorts of things you end up doing are drawing up proposals, making invoices, following up payments and other tasks like that. Instead, it’s much better if you can get more billable hours in. If you could do 10% more billable hours, that’s a payrise for you without raising your rates.

Some tasks that can be, and should be automated.

• Streamline your lead generation process
• Streamline your sales process
• Streamline your project management process
• Streamline your billing, accounting and receivables process

The best thing about streamlining your processes, is that it frees up more time for you to grow. If you’re efficient, you can fit in a lot more billable hours. If you manage projects and delegate a lot of your work, you can manage more projects at once by having streamlined systems.

Not only that, but having automated systems makes it easier to be in business. Tax time comes around and you can just fill in the boxes and be done with it. A new lead comes in looking for information and they can slip into your automated education program.

Documented processes are what allows businesses to expand. Documented processes make it easier to sell your business should you ever want to do that.

I was reading the Web Design Business Kit by Brendan Sinclair (if you haven’t already bought it, go and buy it, it’s a great book), and when you get down to it, the whole book is about his systems. What systems he has found work best from 10 years in Web design.

For someone starting out in business, as I did,  it’s actually quite hard to come up with systems and processes, because it’s impossible to know what works best. That’s where it becomes important to draw on resources.

It is hard to find good resources. Every business is different, and there aren’t many people out there that are giving away these sort of secrets. All of the software that’s out there focuses on project management, which is great, but what it is missing is business management. If you want a good suite of tools, you need Basecamp + Salesforce + invoicing software. You’re up for a lot of $$$ for all of those products.

And that is precisely why I’m announcing a new project that I’ve been working on. The product is called Freelance Total, and it is something I have wanted as a freelancer for a long time. Instead of focusing on the tasks that you do as a business, it is a framework that encourages the use of best practice systems to streamline your business.

It focuses on taking the legwork out of mundane business tasks, so you can focus on making money.

It’s a product that will be developed to proof of concept very quickly, and we will be using it at VDP Websites while we’re building it. As soon as it’s ready to use, I’ll be letting people get access to it.

So, if you’re a freelancer, sign up on freelancetotal.com to get notified of updates. It really is going to be great management software.

Related posts:

1. Self development book reviews I’ve been reading a couple of self development books that...
2. 8 questions in an ecommerce conversation You want your online business to succeed right? The stats...
3. My Products and Services Businesses Businesses that I own or have a stake in....

Related posts brought to you by Yet Another Related Posts Plugin.

Their efforts included making some videos and linking back to their website.

Looks like they got a bit too eager and started posting links to it where they shouldn’t have, and now when people search for their keyword, one of the first results is a link to a page where they were banned for spamming. Also on the page are comments from a bunch of people that are clearly annoyed by the spam.

5 years ago, SEO used to be about how many useless links you could get. Now it’s all about relevance and authority.

Related posts:

1. How to reach the top in local search – Part 3 In part one of this series, we looked at keyword...
2. Google Adwords Quality Score Explained One of the most commonly asked questions about Google Adwords...
3. 5 tips for writing Adwords Ads Ad text is an important part of creating an Adwords...

Related posts brought to you by Yet Another Related Posts Plugin.