1. How to make money with eCommerce David Strom david@strom.com MPA Seminar, 14 April 1999

2. This past holiday season • Sales of books, CDs, and computers continued to increase • Problems still remain with many sites • Estimates still vary widely

3. Obstacles to Wide Deployment of eCommerce • Easy forms of payment • Trust in the system • Perceived benefits outweigh the risk • Technology and infrastructure still primitive • No general agreement on basics

4. Sad State of Today’s eCommerce Marketplace • Poor quality tools • Hard-to-find stores • Limited payment methods • Credit card snooping perceptions • Older browser versions can’t view latest sites

5. Case in Point: Buying a Bike Rack • Item not carried: outdated catalog • Telesales not familiar with web • No cross-sell or substitutions online • Needed three phone calls to complete purchase

6. Critical Success Factors for Physical Storefronts • Location • Branding • Good service • Good product selection • Proper pricing and margins • Traffic

7. Now Try to Agree on Definitions for Web Stores • What determines a good location? • Position on a search page • Nearness to popular destination • Ad on a popular server • What determines branding? • Memorable domain name • Popular search category destination

8. An Example of bad location: Montana Meats • www.imt.net/~lingerie/buffalo/buffalo.html • Can’t they afford their own domain name? • www.company.com/~anything is BAD NEWS!

9. Speaking of Domain Names • Typo.net • AmericaOffline.com • Sell ad space on things like: • amazom.com • www.eartlink.net • acivilaction.com vs civil-action.com • whitehouse.gov vs. whitehouse.com • Is the Internet a great place or what?

10. Dealing With Rogue Domains • bestbuys.com vs bestbuy.com • united.com vs untied.com • Use same colors, try to go after same audience • Lawyers are standing by to take your call… • Use various tools to track down offenders: • companysleuth.com • dejanews.com • rs.internic.net

11. Determining Traffic • Hard to do -- is it hits, page views, registered users? • [HITS = How Idiots Track Success] • Hard to measure -- do you count gifs? Use log files? • No general agreement on any metrics!

12. Traditional Advertising Doesn’t Apply Anymore • Can’t measure anything • Every site has its own banner sizes • The Web is not TV

13. One Working Definition of Success: • SURVIVAL! • If a site is still running after 12 months, and getting more traffic, it is a success.

14. Good eCommerce Principles • Easy to find merchandize • Good service • Individual customization is key • Simple navigation • Make payments easy • Make buyer feel transaction is secure

15. How NOT to Design a Payment Screen • www.netmar.com/new/norderform.shtml

16. Common mistakes with payments • Provide too few or too many order confirmation pages • Confusing methods and misplaced buttons on order page • Make it hard for customers to buy things • Don’t make your customers read error screens

17. Making the Buyer Feel Secure: the Six Components of Trust • Seals of approval, logos of credit card co’s • Identifiable brand name • Ease of navigation • Order fulfillment easy to understand • Clear purpose and site presentation • Fast and simple technology (Cheskin Research)

18. How to Generate Repeat Business • Make the shopper feel part of the family • Shopping as entertainment (online auctions) • “Do what I mean” search function (Amazon looks at common search misspellings made in the previous 24 hours) • Periodic targeted email updates and reminders • Use one-click shopping (cookies or logins)

19. Today’s Panel • Dave Kansas, thestreet.com • Al DiGuido, Computer Shopper/Zdnet

20. Discussion points • Getting started • Targeting the right audience • Which revenue model • Technologies used • Mistakes you now realize