Why Some Online Businesses Thrive & Others Die

What's with those canny entrepreneurs gallivanting around the world while they're still raking in the cash from their websites? Did they find that one amazing product that no one else has thought of and hit it at just the right time? Or did they succeed because of good product research, web design, and marketing? I lean towards the latter, and here's why: As an e-commerce business owner (and the owner of a search marketing firm) I've helped hundreds of businesses succeed and seen many others fail. Often times it's not the super niche product, or the previously experienced and rich business owner that makes it. It's the self-educated risk-taker who has tried and failed, only to try again and succeed. Here are some common themes I've found that contribute to successful e-commerce businesses.

Product Research

First and foremost, the right product(s) should be chosen. Many businesses choose products that are already extremely competitive, have little to no profit margins, or are losing their demand.

• Good Profit Margins: Contact wholesalers and determine your wholesale cost and be sure to also consider shipping fees, availability, and overall trends in demand.
• Low Competition: Keywords for the ideal products will show a high amount of searches and a low level of competition.
• Increasing Trend for Demand: Getting into a product that is going to continue to see only an increase (not decrease) in overall demand means more potential for long term sales.

Web Design & Usability

I find it funny how many people skimp on their websites. Most retail store owners go to great lengths to make their storefront appealing, clean, and professional. And so should any owner of an e-commerce website. Research shows that Internet shoppers demand user friendly and professional design, even more so than low prices. Potential customers often make a snap decision about your business within the first few seconds of visiting your website. Your website must convey trust and must make it easy for shoppers to buy your product.

• Clean & Modern Design: Spend time looking at the web stores of big brands and get to know the ins and outs of good design before choosing a designer. A clean and modern design conveys trust and professionalism to your potential clients.
• User Friendly Design: Countless studies have been made about how people buy online and what they hate. Search for and educate yourself on web usability standards before you hire a web designer, then choose one who has a portfolio of past projects that follow those standards. This ensures you to have the best chance of conversion once a shopper reaches your website.
• Contracts & CMS systems: A whole other article could be written about this section alone. It is extremley important that you own rights to change the web site architecture and design. Some CMS systems and web design contracts actually lock you into forever using their services. I recommend hiring a designer that uses open source e-commerce platforms like VirtueMart (Joomla), OsCommerce, or Zen-Cart.

Website Marketing

Last but definitely not least - good online marketing contributes more to success then proper product research and web design (believe it or not). I've seen websites with the most outdated design and bland products see thousands of dollars in monthly profits because their marketing was extremely effective, and they just got that much targeted traffic. Staples for Internet marketing are search engine placement campaigns, affiliate marketing, and contextual web marketing.

• Search Engine Placement Campaigns: Known more commonly as search engine optimization or pay per click marketing. Over 80 percent of all online sales originated from a search engine placement listing. So, effective search engine placement services can contribute greatly to your site's success. Both search engine optimization for high natural rankings and pay per click marketing are great options, though search engine optimization usually leads to higher ROI.
• Affiliate Marketing: With affiliate marketing you offer a percentage of your sale (or a set amount) to other web site owners that send you traffic that converts into a sale. Essentially they are marketing for you, and you're paying only when you make a sale. While affiliate marketing can be extremely effective, approach this industry with caution and much education as it can be a costly mistake to start the wrong program.
• Contextual Web Marketing: Long gone are the days of effective banner advertisements. Contextual web marketing builds traffic and brand awareness through article marketing, blog marketing, social bookmarking, and forums. They key to success here is getting the word out on extremely relevant sites where your shoppers are already involved.