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Tech Update 
A crash course in e-commerce
Is e-commerce for you?
By Eamonn Sullivan
E-Business
April 10, 2001


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The main difference between traditional commerce and the e-variety is that the customer is not present when you make the sale or conduct the transaction. That's obvious, but too often businesses forget that aspect in the rush to post a snazzy Web site quickly, or fail to consider it when translating existing sales systems to the Internet. You can attribute several high-profile Internet business failures, such as Boo.com, at least partly on a failure to understand the difference between selling to a customer who is physically in the shop and selling to one who is at the other end of an often slow connection and unable to touch the merchandise or ask questions of the sales staff. The problem is not just the technology -- although that's an important part -- it's the business plan. How can your business, whatever it may be, provide enough value for people to get them to fork over money online?

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Are you ready for e-biz?

Find out with this free instant assessment tool from the Arkansas Small Business Development Center.

Another obvious aspect of this difference that is almost always a secondary consideration is that the customer is not present to pick up the merchandise and carry it home. How you plan to deliver the merchandise should be one of your first considerations. Do you have a shipping partner that is rock-solid reliable? Do you have an automated fulfillment system?

More fundamentally, are you selling a product that lends itself to the Web? The now-closed Furntiure.com sold home furnishings. You might buy a $20 book or $15 CD online without ever setting eyes on either one of them. But would you buy a $2,000 sofa, sight unseen? Not likely -- and not unless the Web site has a virtually hassle-free return policy.

But several businesses have succeeded in areas where physical inspection was once deemed essential -- florists, for example. You just may have to take a different approach from the one you are used to.

For businesses selling items that can be delivered over the Web, such as reports or software, you also have to consider how the product will be delivered. How are you going to protect your copyright online?

Finally, does your product need support and training? If you put up a Web site, anyone in the world can access it. How much handholding is required to purchase and use your product and how are you going to provide that in Mongolia? For that matter, how are going to provide that in the next town?

That doesn't mean a locally focused Web site isn't viable -- in fact, it is probably a good idea in many cases -- but it does mean that you need to position your site carefully. For example, if you can't accept international orders, warn your international users so they don't go to the trouble of filling out a very lengthy online form only to discover that, without a U.S. ZIP code, processing won't proceed.

Action items
Arrow Write a business plan, translating your existing business into one that works on the Web. Be sure to describe, as carefully as you can, the customer for your products or services and where the profits will come from.

Arrow Examine your logistics and decide whether they are robust enough to handle a largely mail-order business. Also look at support and call-center resources and decide how you will provide for this.

Arrow Decide on the scope of the business. Is it worldwide or local?

Find out more
Articles:

Connecting the e-com dots
Stay brick and mortar or go online? Here's how to decide.

4 excuses not to put your business online
And most of them don't wash.

What did Boo.com do wrong?
See our Best Practices evaluation.


Related sites and resources:

E-commerce Learn page
Case studies, courses, books to help you deepen your knowledge of e-commerce.

ZDNet Small Business Advisor's Your E-business
Advice and tools to expand your small business onto the Web.

Online classes from SmartPlanet:

A look at e-commerce
Explore the e-commerce process from both the customer and business perspective.

Trends in e-ecommerce
How e-commerce is transforming American business.

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1. A crash course in e-commerce
2. Is e-commerce for you?
3. Devise a strategy
4. Getting started: Do it yourself or outsource?
5. The basic toolkit: Choosing and obtaining a domain name
6. The basic toolkit: Internet Merchant Account
7. The basic toolkit: Establishing your identity
8. The basic toolkit: Application integration
9. Site design
10. Promotion
11. Customer service
12. Performance testing and monitoring
13. E-commerce: The bottom line





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