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Single Biggest Pitfall in Building an Online Business
dnparker
subscriber Posts: 9 Member
Yet again we have had an example of the single biggest pitfall in building an online business. The unfortunate thing is that many times this pitfall must be explored in the business building process. But note I said explored, not depended upon.
The platform on which you run your business must not wholly depend on any other sellable platform. Time and time again we have seen eBay sellers collapse because of a change in the structure at eBay. We have seen a proliferation of affiliate websites fail to even get started because they are selling the same crap every other affiliate is selling.
The most recent example hit a personal friend of my very hard. Kevin Harmon is noted as one of the top 20 sellers on eBay. His recent blog post details the frustration at eBay have allowed Buy.com to come in a list a LOT of competitive products at NO LISTING FEE. Listing fees make up a large portion of Kevin’s expense in selling on eBay and although he sells hundreds of thousands of products on eBay each year, he has never been afforded this type of opportunity. Fortunately, he has diversified his revenue substantially in the past couple of years, but had this event happend just 2 years ago he could be facing a business closing event.
My company experienced such a pitfall recently. We sell management services for pay-per-click campaigns. Google Adwords does not provide any incentive for us to present Adwords as an option to our clients. However, it is so extremely effective we would be remiss not to advise and direct our clients to this resource. Google advised us that the best route to monetize this relationship was to establish a management fee based on the service. We did. Now 3 years later, Google has decided that if a client is spending $5000 or more per month in a trackable conversion format (mostly ecommerce), they will assign that account a “Google Team” to guide that account to greater returns. I think that’s wonderful for the client, but it sucks wind for me. Here I have spent time and effort elevating this account to this level and we just beginning to reap the internal rewards of that relationship and we get scooped by Google. Lesson learned. Within 2 months we had completely revamped the way we handle 3rd party services and our intermediary consultative role between them and the client.
Be aware as you build your online business. As you navigate the thousands of options available to you, keep in mind your own responsibility to build your brand and your direct client base.
The platform on which you run your business must not wholly depend on any other sellable platform. Time and time again we have seen eBay sellers collapse because of a change in the structure at eBay. We have seen a proliferation of affiliate websites fail to even get started because they are selling the same crap every other affiliate is selling.
The most recent example hit a personal friend of my very hard. Kevin Harmon is noted as one of the top 20 sellers on eBay. His recent blog post details the frustration at eBay have allowed Buy.com to come in a list a LOT of competitive products at NO LISTING FEE. Listing fees make up a large portion of Kevin’s expense in selling on eBay and although he sells hundreds of thousands of products on eBay each year, he has never been afforded this type of opportunity. Fortunately, he has diversified his revenue substantially in the past couple of years, but had this event happend just 2 years ago he could be facing a business closing event.
My company experienced such a pitfall recently. We sell management services for pay-per-click campaigns. Google Adwords does not provide any incentive for us to present Adwords as an option to our clients. However, it is so extremely effective we would be remiss not to advise and direct our clients to this resource. Google advised us that the best route to monetize this relationship was to establish a management fee based on the service. We did. Now 3 years later, Google has decided that if a client is spending $5000 or more per month in a trackable conversion format (mostly ecommerce), they will assign that account a “Google Team” to guide that account to greater returns. I think that’s wonderful for the client, but it sucks wind for me. Here I have spent time and effort elevating this account to this level and we just beginning to reap the internal rewards of that relationship and we get scooped by Google. Lesson learned. Within 2 months we had completely revamped the way we handle 3rd party services and our intermediary consultative role between them and the client.
Be aware as you build your online business. As you navigate the thousands of options available to you, keep in mind your own responsibility to build your brand and your direct client base.
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Comments
At the end of the day, its about the quality of relationship you have with your client. The local provider of services has the opportunity to win out over a national provider if their customer service and quality meet or exceed the national provider.
Its been interesting to see a resurgence in manufacturing unique items and services. I think we went through a period in our economy where everything came from big box organizations and it was en vogue to be that type of consumer. Today we are seeing opportunity in the areas of the business world that went through roll-ups years ago. I know one fellow who learned how to manufacture oil paints and now carries over 40 colors of his own line of specialized oil paints for artists. He utilizes the Internet as a marketing tool, but the real story is the fact he decided to enter into a market so littered with Chinese production. And he is having some success. I think it speaks to the fact the consumers want to connect with their producers.
Its this creativity that represents the best opportunities moving forward. Selling and reselling the same old stuff is a commodity game in products and services. Innovation is key.