Practical Ecommerce

Don’t Overlook The Essentials Of Business Startup

I receive calls daily from store owners wondering what they can do to get ample returns on their investments in advertising and search engine optimization. Just when I think I’ve met my match, more calls pour in, and I’ve come to the realization that a good majority of small business owners, especially in the online world, spend so much time feeding their excitement of cashing in on a good market share that the essentials of business startup and upkeep of practices is often overlooked.

The typical example is a company that has spent an unbelievable amount of money on Google Adwords, SEO and online advertising, to name a few, with no regard to keeping the visitors (they pay for) shopping at their store. ROI is a most-oft overlooked necessity of small online stores, and yet, it’s a core reason so many small businesses fail within their first year.

Those familiar with my monthly column here, as well as my weekly blog at this publication’s website, have heard me tout more than once how important design, navigation and guidance is to any online store. And yet, I constantly run into companies doing it backwards.

The fact is, laying money out to bring people into your online store is absolutely useless if the store isn’t ready to shop, and this couldn’t be truer when it comes to vying for a piece of the holiday shopping pie. Helping online store owners see this light is a passion of mine — a priority goal, if you will. And every time I think I’m getting closer, in walk a dozen more store owners, showing me the expenditures. Most recently. I consulted a four-month old business owner — the store boasted a unique and highly functional product line — who was embarrassed to reveal he’s spent $45,000 on AdWords and the likes, yet only averaged about $250 in sales per day. Clicking about the site for five minutes, I rattled off more than a score of issues, right down to in-your-face wording about how things “might” be exchanged if the store owner deemed it acceptable. Between a lack of design and guidance, and one-sided shopping terms, it’s no wonder online shoppers weren’t willing to trust putting their money in this company’s hands.

There is a give-and-take when it comes to the struggle of building relationships with online shoppers — people whom you’ll likely never meet face-to-face. Be ignorant to this fact and just watch your ROI leave you sleepless at night.

It got worse, however, when I found that he wasn’t following guidelines when collecting sales tax, and some of his terms were actually illegal.

I chalk up the failed startups to very few things, most prominently the methods in which we take a great idea and put it into action. Let’s face it, resources like sales tax laws and proper accounting are commonly difficult to understand. But that’s not the worst of it. When I ask store owners how they figured out to get as far as they have, I’m often met with reasonings akin to listening to what friends and family advised, and reading the websites that merely provide basic, sans detailed lists. We, as a society, are so eager to get our feet in the game that we hurdle right over the obstacles, without even knowing what they are. While some wind up being successful, the majority of store owners who’ve never even devised a business plan, or researched extensively all the financial factors of operating an online store, won’t see much of an ROI. If anything, they’ll find themselves digging deeper into that pocket, which is none other than their personal bank account.

If you’re similar to some of these business owners, I often have to sit down and force you to look at the big picture, then perhaps I’ve concerned you — perhaps even scared you. To which I respond, I’ve done my job.

Hope, however, is not lost on all. Though the busiest time of the year is upon us, I still lend merit to the saying “better late than never.” I can only urge you to slot aside a great amount of time after the first of the year — much needed time to revisit the beginning of your business plan and plot out your goals, and maintain focus on what it’s going to take to be legal, successful, and ultimately, proud.

Pamela Hazelton
Pamela Hazelton
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Comment ( 1 )

  1. Legacy User August 7, 2007 Reply

    Very nice article! There is a business in my area, whose existence I only know of because their ads appear on several of my sites via AdSense. Sadly, when I have sought to contact them myself via email, their email spam filters will not allow me to reach them from any email on any computer! They are, in all likelihood, spending increasing amounts of money to get the word out, and are unaware that they are reaching people, but people can't reach them! What good is advertising if your spam system just rejects all your contacts?

    — *James Burns*

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