"Your New Store on the Web"

Presented to the Gift Retail Trade Show

at Dallas World Trade Center

George Matyjewicz

January, 1998

What is the Internet and World Wide Web?

The Net was started in the 1960's at the request of the U.S. Government to prevent unfriendly groups from breaking into our government and military information systems. It is an interaction of many networks linked together via access providers. In 1994 browsers were introduced, which allowed graphics. In addition, commercial sites were allowed, and the Net became the World Wide Web, and saw a stratospheric growth. The Internet a/k/a the Net, or the World Wide Web or the Web can also be considered 'The Great Equalizer' -- all companies are equal - a 14" screen!

 

Benefits of Doing Business on the Net.

It is your electronic business card, an opportunity to tell the world all about your business. It is also an excellent market research tool for business and financial information and a place for you to keep ahead of your competitors. You can provide information to potential customers without them feeling pressured by sales people. E-mail helps you communicate with your customers and/or collaborate on projects with others throughout the world.

 

Who Promotes Their Wares?

Our illustrious President and Vice President, along with all members of Congress have a Web site. Educational Institutions and the military, professional firms, business-to-business, retailers selling to consumers, employment opportunities, large companies and small all promote their wares. More importantly - YOUR COMPETITORS!

Looking at demographics by Sic code, we find 52% of Net business is services. Followed by 17% in manufacturing, 8% wholesale businesses, 7% retail, 6% finance, insurance and real estate and the remainder consisting of transportation and utilities, construction, agriculture, forestry and fishing, and mining.

How do they find your businesses?

The Net has a unique trait not found off-line -- search engines. They are like gigantic Yellow Pages, of every possible category in every country in the world. Surfers go to search engines and enter a key word that describes what they are seeking. The trick is to get your site listed on the first 10-20 listings. Most purchasing decisions are the result of intentional searches, i.e., somebody is looking for gifts, or more specifically, for personalized gift items like a personalized growth chart. Which means, if you rely on browsing and impulse buying, you will not reach these people.

What Sells, or more important, is anybody making money on the Net? On the Net, anything can be bought or sold. The most popular items sold are PC hardware and software, travel, entertainment, books, music, gifts, flowers and greetings, apparel and footwear and replenishment goods (groceries). HotHotHot http://www.hothothot.com), the oldest commerce site is still doing a lot of business selling hot sauces. Amydoodles of Needham, Massachusetts http://www.amydoodles.com) tripled her four-year-old business in 1997. Amazon books http://www.amazon.com now claims to be the largest book store in the world, and it doesn't have a physical store! And Dell Computers is now generating more than $3million a day from it's Web site! http://www.dell.com/dell/media/97/9711/24.htm

Canadian success story.

Art a deux, Ltee. (My Sentiments(TM) Fine Art Cards) is a Toronto-based card store who has had an online presence for almost 2 years http://www.art-cards.com   Barb Sybal is the owner, and reports that it took approximately 6 months of both on-and off-line marketing to get noticed by potential customers. The site now averages 100,000 visitors (or 500,000 hits) each month (except that the traditional January fall-out has slumped by 50-60% for both visitors and sales).

Of those visitors, 50% are consumers (they have a few items on-line that appeal to this market segment). Approximately 10%-15% of the remaining 50% request a catalogue and approximately 2%-5% become customers once they've received the printed material. Almost 99% of all new customers who have found My Sentiments(TM) through the Internet are in the United States, which they can break down into further geographical segments The remaining 1% of inquiries tend to be international (with very little interest coming from Canada) and My Sentiments(TM) have found themselves negotiating quarter million dollar deals with companies located overseas (from Western Europe to South East Asia).

"If it weren't for the Internet, our cards would probably take another 3-5 years to be found in stores across North America through normal channels (sales reps, etc.)," said Barb. "We've found the Internet a much more cost-effective way of brand recognition for a small company such as ourselves. We're also excited that rural communities who are using the Internet to find new suppliers are finding us."

Who is the Net "Surfer"?

The profile of the Internet "surfer"is 37 years old with an annual family income of $53,300; 85.7% have some college; 40.2% are married; 88.1% are Caucasian; 63.4% have been on the Net 1 year or more; 68.1% bought on Net in last 6 months of 1997; it is almost evenly divided between men and women.

The reason they shop the Net is convenience, availability of vendor/product information, no sales person pressure and to save time. And, 39% of those who surf the Net looking for products will also shop at your store!

Taking Orders.

One NJ-Based company (The Systems House, Clifton, NJ http://www.tshnj.com) offers NetLine, a family of software products that will allow customers (either in a business-to-business or retail environment) to access your database without tying up your system or staff. Customers can view your product line, place orders over the Net and inquire on the status of orders. The Systems House can act as a service bureau for you, and transmit orders to your office via e-mail, fax or EDI. Or, you can obtain their system to link into your own back-office order processing system. Obviously, the information that customers can obtain is protected.

Promoting Your Virtual Store.

A virtual store in a lot of ways is just like a physical one. You still need to promote it. Off-line promotions are critical. Place your Web site address (URL - Universal Resource Locator) in your classified and display ads, and on the counter in your store. Start a sign-up list for customers to be notified (via e-mail) of sales and special events at your store. This can be done, by the way, even if you are not on the Net.

SaleNews. One relatively-new, NJ-based company (SaleNews, Somerset, NJ ) will help you take advantage of the Internet for sales notices, even if you don't have a presence on the Net, or if you don't even have an e-mail address. SaleNews offers advanced notice of sales (http://www.salenews.com) to subscribers to their newslist. They use your database, or gather information for you from visitors to their site. You tell them about your sale and they send a notice to those folks who have shown an interest and are in your shopping area. Customers read the e-mail and click on the link to their site to obtain (clip) a coupon, which is tendered in your store. They give you a report of the number of customers who received your notice and the number who "clipped" your coupons. They are bringing the virtual world to your local market. And, you pay only when an announcement is made. A brilliant concept.

Send out a press release announcing your new store, to the publications where you presently advertise. You can also send it to media contacts on the Net who cover your target area. We have a service called Automated Press Releases http://www.gapent.com where we can distribute your press release to over 7,600 media contacts worldwide.  Some publications also offer on-line advertising - commonly called banner ads.

Search engines are mandatory for exposure, but they are not the panacea. Too many people put up a Web site, submit it to search engines, then sit back and wait. Then they pack it up when they don't get the results.

Where the Net does differ is with direct mail. Too many new folks to the net (a/k/a "newbies") think they can purchase a mailing list like they do off-line and send out a notice to millions of people. Wrong! This is known as Spam, and is not tolerated on the Net. There are services that offer "opt-in" lists where people signed up to receive product information in certain categories. These services are accepted.

Summary. So, is the Internet for international or local business and is anybody making money? The answer - yes!

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GEORGE MATYJEWICZ is Chief Marketing Officer and Managing Partner at GAP Enterprises, LLC a management and marketing Solutioning (tm) firm. A former retailer, he is also a veteran computer and Internet user. For answers to your questions, e-mail George Matyjewicz or call him at (201) 866-8199 or write him at GAP Enterprises, LLC, Harmon Cove Towers Secaucus, NJ 07094. Or visit their Web site at http://www.gapent.com/