SmallBizLady: How do I decide what to sell online?
Steve Power: Choosing what to sell online is one of the most important decisions you’ll make as an entrepreneur. To be successful, try sticking with what you know while solving issues you see in the real world — life hacks, contraptions, simple solutions and services are great places to start brainstorming. Pick products that you’re passionate about or things you’ve had experience with in the past. You can market a new item you’ve invented that you think solves a unique problem, or you can build a brand around products that are already popular in the market, like toys, jewelry or pet supplies.
SmallBizLady: How do I choose where to sell my products?
Steve Power: The first step is picking an ecommerce solution. If you’re new to selling online or aren’t familiar with coding, a custom solution may not be the best idea. Not only can it be very expensive to hire developers, it can take months to build. It’s also not wise to spend the money before testing the market with your idea. I’d recommend starting with a full-service platform because it’s cheaper and you can learn more about your audience, which means better conversion and more dollars in your pocket.
SmallBizLady: What’s the easiest way to start selling online?
Steve Power: A full-service ecommerce platform can help you get started with very little technical effort, plus its flexibility will support your business as you grow. It’s important to check out any platform’s forum, blog content and support materials. Get on the phone with their support or sales team to ask questions about why that platform might work for you. Ask people who have used that platform for their honest feedback, and definitely cruise through the platform with a free trial so you can tinker with features — any platform that doesn’t let you test it before you buy is a red flag. Once you settle on a platform, their team will guide you through setting it up.
SmallBizLady: How is an online store different from selling on Etsy or Ebay?
Steve Power: Setting up shop on sites like Etsy or Ebay may sound easier initially, but having your own website gives you complete control of your product, marketing and pricing so that you can truly scale your business. Etsy and Ebay take a percentage of your cut from the start, plus sellers are at the mercy of price increases or site changes that they have no choice but to follow. Plus, competition on these sites make it difficult to generate repeat buys or differentiate your products from other similar stores on the same site. There is little opportunity to create a memorable brand experience and hook repeat customers. In addition, you don’t have SEO control on Etsy or Ebay — many sellers have seen a decrease in traffic after search engine updates, so fewer people are seeing their products. If you want to be in control of your own business, costs, and marketing, the best way to do that is with your own website.
SmallBizLady: How do I know my product will sell?
Steve Power: Not everyone on the web will want to purchase your product — you need to dig in and find your target market and affirm your product’s market viability. Focus on the problem your product solves, and who needs to solve that problem. That’s your target market. For example, PetPaint looked at the niche market of pet costumes and identified a totally different way to outfit pets (with paint), and that resonated with a passionate group of buyers. Then, drill in even further to identify who has likely bought your product or service already. If your business idea is brand new, look at your competitors to get additional insights into their marketing and targeting.
SmallBizLady: How do I get funding for my online business?
Steve Power: Finding a source of funding can be a challenge, especially since the average cost of starting a business is $30,000 — but it can and must be done. There are three main ways to fund your business: securing money from investors, crowdfunding campaigns and bank loans.
Investors don’t have to be a venture capital firm. In fact, the best way to get capital is to pitch your family and friends as investors. If you go that route, or the VC route, decide if you want to issue a loan from them or a share in the business. The latter can be helpful if you need guidance or a partner to have “skin in the game.” No matter which way you decide to go, be realistic about how much money you need. You can ask for money in chunks to fund specific parts of your business, like setting up inventory. SBA.gov has tons of resources to help you decide which method of funding is best for you.
SmallBizLady: How do I make my online store look beautiful?
Steve Power: Keep in mind that conversion should be priority No. 1 — it’s about making money and driving shoppers to the checkout page. “Pretty” is a stellar bonus, and the design should always reflect your brand. To do this, focus on quality from the beginning so that your store looks professional and attracts the right shoppers. Instead of trying to be a graphic designer, use pre-designed site templates that come with your ecommerce platform that offer a clean, focused look, I like GradysColdBrew.com.
Remember your online store should showcase your product. Product photography is important here — big, clear, realistic photos will allow customers to virtually handle the products, giving them a clear view of their quality and intricacies. You can create your own photography setup with simple materials like a tripod and decent camera (even your smartphone will do), a white backdrop sheet and sufficient lighting.
SmallBizLady: What’s an ETA for getting my business off the ground?
Steve Power: Once you’ve done your research to pick your product and ecommerce platform, you’ve just got to get into the nuts and bolts of setting up your infrastructure and choosing which features and customizations you want to use to wow your customers. If you’re committed to buckling down and getting a beautiful online store off the ground, you can get through the entire process in a weekend. You can always make changes and tweaks to your store and marketing strategy as you go.
SmallBizLady: How do I uncover and develop my brand?
Steve Power: To create a brand people love, consider your customers. Remember their wants and needs, and think about what would make them excited to be in your community. What images, stories and words elicit emotion around your product? People purchase products because of the emotional connection they feel with a brand, not because of a logo, set of colors or catchy tagline. A brand is something that customers feel, that makes them excited to interact with your company or others who love the brand, too. From social media to emails, the checkout page and packaging, each consumer touchpoint should be considered and reflect a unified brand experience.
SmallBizLady: How do I generate repeat customers?
Steve Power: Email marketing is 100% measurable and highly targeted, so often-times this will generate your highest ROI out of any organic channel. It’s easy to do, and free apps like MailChimp can walk you through the entire process. Think about seasonal events you can leverage for email promotions, and when there isn’t a seasonal opportunity, think about how you can reward some of your top customers with special discounts or personalized outreach. You can also use targeting techniques with paid campaigns on social media by posting specials, coupons, new products, etc. Customer service is crucial, too — focus on providing the best customer experience you can to create brand trust and loyalty.
SmallBizLady: How should I use social media marketing for my online store?
Steve Power: First of all, you need to pick which network(s) is the best fit for what you’re selling. Is your product beautiful and highly visual? Consider Pinterest or Instagram. Do you want to tap into larger conversations relevant to your brand? Twitter and Instagram are best for that. Facebook is still the social leader in driving traffic and purchases to online stores, and it can be the best place for building a community around your brand. No matter the channels you choose, form a content theme that links all of your marketing mix together.
Social media is all about building a community, and people are on social media either to be informed or entertained. Develop content that speaks to your audience directly and start or join conversations you think they would be interested in. Provide inspiring and interesting content that’s relevant to your business, but stray from being overly promotional. Be prepared to provide customer service on social media, and always aim to be responsive in a prompt and honest manner. Social media is a great place to crowdsource for product ideas, too. There are a million different strategies that could work for your pages, so be open to adjusting for what content works, what doesn’t, and how often you should post.
SmallBizLady: How do I track the success of my online store?
Steve Power: The most important ecommerce benchmarks are AOV (average order value), repeat revenue, and CLV (customer lifetime value). Get comfortable with purchase and customer data to help you pick out the rich insights you need to crush these benchmarks. For example, review your sales data to find out what products are most popular. Focus on getting more reviews of those products so more people will add them to their carts — in fact, product reviews create a 74% increase in product conversion.
Repeat revenue is important because the typical online store gets 43% of its revenue from repeat customers. Once you have a customer base, focus on growing revenue by targeting your existing customers instead of offering discounts to gain the attention of new shoppers. Your data can help you figure out how soon after a purchase to reach out to a customer, or how often you should be emailing your various customer segments.
CLV is the single most-important metric for your online store. Why? The top 1% of ecommerce shoppers spend 30x more than the average customer. Their lifetime value to your business is much higher than the average shopper’s, so spend your time and budget marketing to them. Treat your best customers like VIPs by writing them a note or offering a special deal, and watch what happens to your profit. Having a great analytics and insights dashboard on your ecommerce platform can help you with all of this.
If you found this interview helpful, join us on Wednesdays 8-9 pm ET; follow @SmallBizChat on Twitter. Here’s how to participate in #SmallBizChat: http://bit.ly/1hZeIlz
For more tips on how start or grow your small business subscribe to Melinda Emerson’s blog http://www.succeedasyourownboss.com.