Amazon’s Second Life Virtual Marketplace

 

I love the old AT&T “You Will” commercials in the mid 90’s that painted an inspiring vision of a technological future (I don’t think anybody wants to talk into a watch now that we have bluetooth headsets but how can you say no to a gadget??).

If you were to make a similar series today you would have to include virtual worlds and eCommerce, represented (I may as well write the script while I am at it) by a consumer navigating easily through an online shopping experience with easy category navigation (looking for apparel? head this way), interacting with trusted friends and family about recommendations and specials, taking advantage of tailored ad-hoc promotions and one-click checkouts.

Virtual world leader Second Life may not become that home run but thanks to the Amazon AWS team it’s making interesting strides in that direction. That team has just launched a virtual marketplace in Second Life and is looking for exhibitors. A two-week experiment, it’s first come, first serve and you’re limited to a 15 x 6 ft space. But it’s free (haven’t you all been clamoring for a no-fee Amazon?).

Why should you care? Even if you’re hopefully too busy growing your online business, more and more affluent consumers are spending their leisure time and real dollars in these virtual worlds with virtual friends. Retailers and manufacturers are quickly discovering this space — important to keep an eye on this budding channel.

AWS

6 Marketing Tactics Worth Paying

Here’s the trouble with marketing programs: Unlike with hard assets like buildings or machinery, you may have little to show for your investment when the money’s all spent.

Marc Lore isn’t fazed by such uncertainty. A serial Web entrepreneur and father of a two-year-old, Lore founded Diapers.com back in January 2005. Last year his Montclair, N.J.-based outfit posted sales of $11 million, says Lore, thanks to rabid interest from parents looking to buy diapers, soaps, bottles and baby formula for their little ones. (Lore expects to cross the break-even mark in 2008.)

His big marketing bet: a referral program that so far has racked up $200,000 in costs, including development and rebates. Lore credits the program with attracting 40% of Diapers.com’s 200,000 unique users a month. “It was absolutely the biggest driver for [our] growth early on,” he says.

Here’s how the referral program works. Moms and dads send an e-coupon from Diapers.com with a unique code to fellow parents. When their friends cash in on the coupon, they type in the referrer’s code. From then on, every time those new customers place an order on Diapers.com, the referring mom or dad gets $1 in their Diapers.com account.

Sure, those rebates can add up. But given that each order clocks in at $85 on average, that marketing investment amounts to a mere 1% of sales.

Unlike many entrepreneurs, Lore seems to be striking a tricky balance. While keeping a lid on marketing expenses is critical, at some point you have to pay up if you want to drive sales. “Small businesses will say it’s too expensive instead of looking at marketing strategies as an investment,” says John Janstch, author of Duct Tape Marketing. Still, he says, a good marketing strategy is one thing “you can’t really cheap out on.”

With that, here are some marketing strategies that are worth the investment.

The first step most entrepreneurs overlook is defining the market–and its willingness to pay–for their product. (Indeed, such analysis is a fundamental step in any sound business plan.) Market surveys–online, direct-mail or by phone–can help, though they can cost up to $10,000. Online surveys are easiest. Zoomerang charges $599 for a year subscription to its service, which helps craft survey questions and analyze the data; Survey Monkey offers subscriptions starting at around $20 per month.

You know you need a Web site, of course, but the key is getting the most out of it. Start with a clean design that tells people precisely why they should spend their time and money with you. Then Budget a few grand for getting noticed by the big search engines like Google and Yahoo! You can buy keywords like Google’s AdWords, which help direct customers to your Web site (see “Marching Up The Search Stack”) or even hire a “search-engine-optimization” expert (see “Should You Hire A Search Engine Consultant?”).

You’ll also want to shell out for an effective e-mail campaign that will slice through the information overload and get your business noticed. Those that give customers a call to action–like Diaper.com’s referral program–will get more people onto your Web site or into your store.

E-mail marketer Constant Contact charges $15 a month to blast e-mails to up to 500 addresses; $30 will get you up to 2,500. StreamSend charges $6 per month for 500 e-mails and up to $50 per month for 50,000 e-mails. Those prices include testing presentations in different e-mail formats–such as Yahoo! mail and Google mail–and tabulating the response and bounce-back rates. Note: You have to provide the addresses, which might require an additional investment in lists of names sold by list purveyors. (For more e-mail marketing tips, check out “Artful Spam” and “E-Mail Marketers Should Look Beyond Outlook.”)

Of course, no one hits on the perfect strategy on their first try. Instead of placing all your bets on one radio advertisement or telemarketing campaign, concurrently test two or three strategies on targeted groups of customers and in limited areas. “It’s hard to convince companies to do this because they want to do everything rapidly, but then they end up wasting a lot of money,” says Wharton’s Lodish.

In the end, remember that marketing isn’t just about one tactic vs. another. It should be an ongoing effort that involves a variety of maneuvers to raise your business’ profile against your competitors. “Look at the overall system,” says Jantsch. “Look for ways to build momentum by having strategies work together. It’s like building a house–the more pillars you build, the easier the overall job is.”

Forbes

Top 10 Unusual But Successful Online Homebusiness Ideas

http://www.hardtofindseminars.com

Michael Senoff has stumbled upon a perfect online home business opportunity – reselling old seminar materials. He was really impressed by Jay Abraham. The only problem was that it costs $20,000 to attend Jay’s workshops (no wonder the press called it, “the world’s most expensive seminar”). So he did some digging and managed to find a guy from Northern California who had attended the seminar, asking to buy seminar materials off him. He bought the entire set for … 50 dollars. He later found out that Jay’s materials are being sold on eBay for several hundred dollars. He broke up the original package (that he got for $50) in several pieces and sold items for $1700. Thus, his perfect online homebusiness was born. Michael now resells old seminar materials for dozens of marketing gurus, easily profiting over $1000 a day. Read full story in Mike’s own words.

http://www.hungrypod.com/

Catherine Keane, the owner of Hungry Pod, makes over $100,000 a year, uploading music to other people’s iPods. This online homebusiness idea came to her when an acquaintance offered her $500 to load his CD collection onto his iPod. Thanks in part to a small story in The New York Times, Keane’s advertising efforts on Craigslist and word-of-mouth, HungryPod has expanded to three employees and four computers, and has annual sales that exceed $100,000. Read The New York Times article about Catherine and her business.

http://www.idonowidont.com/

Joshua Opperman has his ex-fiancée to thank for his thriving online home based business. After the breakup, he was stuck with the engagement ring he paid dearly for. He went back to the jeweler where he’d bought it three months earlier, but found he could only get 32 percent of its original cost. Josh didn’t like that one bit, so he set up a site, where people in the same situation can sell their engagement rights for a better price. See the full profile of this online homebusiness here.

http://www.pickydomains.com/

This is a great online home-based business idea that requires no money and that anyone can start. PickyDomains is a risk-free domain naming service that got a lot of publicity and ‘blogtalk’ in Europe lately. This is how it works. A customer deposits $50 dollars and describes what kind of domain he or she wants. Domain pickers then send in their suggestions of available domain names. If the customer likes one of the domain names and registers it, the service gets $50. Otherwise the money is refunded at the end of the month. Read full article about how you can make money naming domains here.

http://www.greekgear.com/

Reading a business magazine in the doctor’s office inspired Joseph Tantillo to try his hand at online retailing. At the time, he and his wife were expecting their first child and wanted to work from home. An article about starting an online store jumped out at him, he recalls—and, as a member of a fraternity in college, he decided to sell personalized Greek apparel to that market. After setting up shop for just $79.95—the cost of a merchant account with Yahoo!— he began researching what kind of products his former fraternity brothers might like. Using the strong Greek network worked, as he’s built GreekGear.com’s yearly sales to $1.9 million. Read Joseph’s story here.

http://rickspicksnyc.com/

Rick Field, a Yale graduate and former TV producer for Bill Moyers, is a perfect example of how you can start successful home business out of a hobby. Field learned the art of pickling when he was growing up in Vermont. About eight years ago, gripped by a sense of nostalgia, he took up pickling again. In his tiny kitchen, Field made family recipes and then quickly began experimenting. People’s wildly enthusiastic response to his Windy City Wasabeans (soybeans in wasabi brine) and Slices of Life (sliced pickles in aromatic garlic brine) told him he was onto something. Read how Rick took his homebusiness online here.

http://www.militaryexits.com/

Karin Markley set her online business right out of home. Having 15 years of experience working in a civilian employment agency and knowing that companies value employees with military backgrounds, and she wanted to provide a one-stop link between the two. Karen contacted the Department of Defense for permission to use its seal on her Web site. It took months to get it, but MilitaryExits.com is now linked to all the military bases. Markley, who projects annual sales of $600,000, points to her biggest reward: “Helping the military. Getting the letters and phone calls from these people thanking me so much for what I’m doing for them.”

http://www.hotsauceblog.com/

If I told you that you can make $200,000 blogging about hot sauces, you wouldn’t believe me. Yet, this is exactly what Nick Lindauer does. In 2001, while still in college, he launched his online homebusiness then called Sweat ‘N Spice out of his Springfield (Ore.) apartment. He sold a few dozen types of hot sauces, packaged each order by hand, and shipped everything from his local post office, barely eking out a profit during his first year of operation. Today, Lindauer sells over a thousand products from some 300 manufacturers. In 2005, the business grossed around $130,000. He got $200,000 in 2006. One day, it’s going to be a cool $1000000. Full story.

http://amazingbutterflies.com/

Amazing Butterflies is really an amazing million dollar homebusiness idea success story. Jose Muñiz’s career began when a friend bet him $100 that he could not sell butterflies for a living. Now, seven years later, the former business consultant and his wife, Karen, own Amazing Butterflies, a live-butterfly distributor that generated $1 million in revenues in 2006. Though Muñiz is still waiting for his $100, he says that he has backed his way into a job that he loves. “I could never go back to consulting,” he says. “This is just too much fun.” Full story.

http://www.laneigepurse.com/

What began as a solution to her chronic back and neck pain is now a line of purses for women who share Kristy Sobel’s condition–or simply want a fashionable fanny pack. After three car accidents that resulted in extensive back and neck surgeries, the 35-year-old entrepreneur realized she couldn’t do the traveling her then-job required. To ease the weight on her shoulders, Sobel searched for a fanny pack that would accommodate her condition, but realized fashionable ones were nonexistent. So she created one. Before long, family, friends and even strangers were requesting this one-of-a-kind purse. She approached boutiques with her design after successful test runs at her friends’ shops, but the door-to-door routine eventually took a toll on her body. Sobel continued her venture from home, found a rep to promote her bags at a trade show and used her and her husband and co-founder Eric’s savings to launch LaNeige Purse. Last year she made over $200,000 from her purses.

Books on homebusiness:

The Super Affiliate Handbook: How I Made $436,797 in One Year Selling Other People’s Stuff Online

Missed Fortune 101: A Starter Kit to Becoming a Millionaire

Internet Riches: The Simple Money-making Secrets of Online Millionaire

Flat-Fee and Other Online Shipping Gimmicks to Soothe the Savvy Customer

“As exciting as e-commerce is, it’s still a bricks-and-mortar world when it comes to the average American shopper. So some of the most powerful lures in online retailing these days focus on cheap shipping.
“Fixed shipping fees make the purchasing decision cleaner for consumers,” says Matt Rutledge, CEO of Woot Inc., a Carrollton, Texas e-tailer of consumer electronics and other gear. “For them, you’ve got to make it akin to driving out to buy something at the store. It’s neat and clean.

“The further away that you can tuck shipping distastefulness from the online-buying experience, the better.”

That bit of psychology explains the popularity of e-tail icon Amazon.com’s flat-fee Prime shipping service, launched in 2005. For $79 a year, members get unlimited, free two-day shipping with no minimum purchase.

The times, they have a-changed

Once upon a time, not very long ago, e-tailers thought way differently about shipping fees. Many sites showed their high shipping fees only near the end of a transaction — a margin-enhancing “gotcha” — to make up for one of the high costs of selling on the Web. But savvy consumers who spent a little time comparing prices often found that shipping fees wiped out the “deal” they thought they were getting.

Today, the Web is still a low-margin environment, but Prime, among other models, was a response to higher consumer awareness of — even preoccupation with — stiff and often padded shipping charges.

“People who are online love free shipping, and if there’s a shipping charge, they like to know what it is before they totally check out,” says Miki Dzugan, president and marketing chief of Rapport Online, an Internet consulting firm in Sedona, Ariz.

Some cold, hard facts

A recent Jupiter Research survey found that free shipping is the top promotional method of encouraging online buying. In another recent study, rival market-research firm Forrester Research reported that 57 percent of abandoned online shopping carts were tied directly to surprise shipping fees at the end of a purchase.

Forrester also found that 88 percent of the online shoppers surveyed have left items in a cart without completing the purchase.

What’s the math?

Reporting on Prime, Inc. magazine asked Amazon founder and CEO Jeff Bezos how the company can afford “the guy who pays you $79 so he can order a $3.99 razor whenever he needs one.” Bezos said, “It all works out. Somebody else will order an $800 digital camera. On average, it’ll pencil out OK.”

Jason Billingsley figures that for a return on investment for the average Prime customer, he must order only six to 10 times a year, depending on order size and content. Billingsley, vice president of marketing for Elastic Path Software, in Vancouver, says that’s because the typical cost of two-day shipping in North America is $7 to $10.

“Amazon’s genius in launching Prime was that it essentially became like a buyer’s club, or an insurance policy,” Billingsley adds. “You may or may not use up your quota. It also promotes loyalty to Amazon, because there’s little need for consumers to look around for free-shipping offers.”

Other takes on the tack

Yoox.com, a fashion and accessories e-tailer, charges $7.95 for regular shipping and $14.50 for express — no matter the order. “That’s because we continually want to have the best customer care and be fair, and not dissuade people from buying more product from us for larger amounts of money,” says Hilary Bowers, co-founder of the New York City-based company. “It costs us far more than that to ship most orders.”

More e-tailers are moving right past flat-fees to free shipping. Petsmart, the online pet supplier, offers it for orders of more than $75.

“We’re crossing some kind of new threshold here,” says Mark Taylor, chief logistics officer of RedRoller, a Norwalk, Conn., provider of software that compares shipping costs. “Customers are the ones that are winning.”

StartupNation

Improve Your Online Customer Service

If you’re wondering why customers aren’t coming back to your e-business, maybe you should take a long, hard look at your customer service.

Even if you master each and every one of the internet marketing strategies out there–sales copywriting, search engine optimization, e-mail marketing and the rest–they’re not worth a dime if you forget about customer service. It’s a strategy that all truly successful business owners understand and pay careful attention to because the one thing all successful businesses have in common is satisfied customers.

There’s an old saying in business: A happy customer will tell one or two people; an unhappy one will tell 10! So it pays to keep your customers happy–especially when doing business online.

Online, a seriously ticked-off customer might not just tell 10 people; they might also write a lengthy rant on their blog, post comments on other people’s blogs, write a negative review of your site on a shopping website, or criticize you on forums and message boards. Or all of the above.

And worse, once something’s been written about you online, it’s very difficult to get it removed. This means that any prospective customer who decides to do a search on your business name could come across it.

So while good customer service might cost a bit of time and money, bad customer service online could cost you dozens of prospective customers. Think how much losing even just 10 sales would cost you, and compare it to the extra sales you’ll gain from making your customers happy.

What’s really interesting is that many case studies show that building good customer service into the operation of a business increases a company’s efficiency as well as its sales. Here are some simple strategies to help you improve your customer service:

Step #1: Automate your sales process to keep customers in the loop.
Use autoresponders to thank your customers for their order, welcome them to your opt-in e-mail list, and send them order confirmations and other transactional emails like “your item has shipped” notices. Customers have come to expect these courtesies, but not everyone online bothers.

You can even add an element of surprise to these customer-service e-mails by including a coupon for money off their next purchase or some extra information they’ll find relevant to the product they’ve just bought. You may also want to ask if everything is all right with your customers’ purchase or if there’s anything further you can do.

This kind of follow-up can relieve any possible feelings of buyer’s remorse and reinforce the positive feelings about your business your customers had when they originally bought from you.

Step #2: Create a comprehensive FAQ page.
An FAQ page answers most of the questions people might have about your products or services. You should also create an FAQ e-mail address, such as info@mysite.com, and keep track of the questions that customers or site visitors actually ask, then answer them and put the answers on your FAQ page.

With those common questions taken care of, you’ll be freed up to spend time giving personal attention to the visitors who need it. The more quickly you handle their concerns the more impressed they’ll be. And you’ll also stand out in the crowd–a recent Pelorus Group study found that a shocking 42 percent of retail sites take five days or longer to respond to customers.

It’s often the times when you respond to a customer’s concerns promptly and personally that generate a huge amount of goodwill for your business–and referrals. Even angry customers can be turned into devoted fans if you pay attention to them, acknowledge your mistake if you’ve made one and fix their problem.

Step #3: Make it easy for people to contact you.
There will always be times when a customer needs to talk to or e-mail someone directly, so don’t hide your contact details away in a dark corner of your website, and always provide contact information on every message you send out.

You may also want to create a customer service page on your site that includes your FAQs, the names and e-mail addresses or phone numbers of people who can help, and other relevant information.

I’m often surprised at how many people with small e-businesses really don’t want to talk to customers and actually make it hard for people to get in touch. But the worst thing you can do is look like you’re hiding or just don’t care.

Step #4: Personalize and segment your e-mail messages.
I can’t say this often enough: Use your customers’ names in your e-mail subject lines and in your messages. Only 4 percent of marketers personalize and segment their messages, according to Jupiter Research, and yet personalized messages have almost twice the click-through rate of bulk e-mail.

As an e-business owner, you can personalize and segment your communications with customers in many ways, including:

• Personalizing emails with names and other pieces of information you collect
• Sending customers personalized birthday, anniversary or special occasion offers
• Sending customers details of new products you know they’ll be interested in (in its recent “Consumer E-Mail” study, DoubleClick reported that 43 percent of the respondents would respond to “purchasing recommendations based on past purchase behavior”)

The more details you can collect about your customers, the better you can serve them with laser-targeted offers, thank-you messages and information that’s relevant to their needs and wants.

This is where your e-mail management software makes your life easier. It can do the segmenting and personalizing for you, so you can spend your time thinking of more ways to target your marketing.

Step #5: Ask your customers how you can serve them better.
People love taking short surveys, and it’s been shown that customer satisfaction is rated higher among people who’ve been asked what they want, even if their answers haven’t been acted upon. Just asking what your customers want and how you can make your service better makes them feel listened to.

Actually acting on their suggestions and improving your service is gravy!

Remember, good customer service doesn’t have to cost much. You don’t have to spend a fortune giving away free products or large discounts. Even a small gesture like thanking customers for their business can help maintain a positive vibe around your business. And automating your everyday customer service tasks frees you up to respond to real concerns or complaints–making your overall customer service even faster and better.

http://www.entrepreneur.com/ebusiness/ebusinesscolumnist/article172294.html