19 mistakes that online businesses make-part II

10. Beautiful pictures make people read your emailers
Talking of beautiful websites brings me to beautiful emails about beautiful websites. One of the standard ways of promoting a website or article is to send out emails. Unfortunately, most such emailers are cut and paste jobs of the print creative- just put the print advertisement into an email and send it out. Now, most email clients are configured not to show pictures in emails unless the recipient specifically asks for it by clicking on a button.

So, effectively, when you send out picture ads as emailers, you are depending on the subject line piquing the attention of the reader and making her want to see your ad.

11. People read emails
An even bigger problem is that your emailer may never reach your intended audience in the first place. Let us assume that over time, you have collected an impressive number of subscribers to your mailing list. Now, you face three significant problems in communicating with them.

One, a significant portion of your email list is invalid. As people move jobs or move from one free email service to another, they rarely update the information at the various websites they visit – at best some of them will re-subscribe from the new email address. Good list manager software will remove email addresses after a given number of bounces to give you a more realistic picture of your database size. Empirical evidence seems to suggest that as much as 20% of your email database could get invalidated like this every six months. But then you need to be using such list managers and should have enabled bounce management!

Second, an email has to go through multiple spam filters before it reaches the inbox of the intended recipient. Most mass mailings, particularly those with only graphics in them or those with suggestive titles in them will never reach the intended audience.

Finally, the reader has to open the message and read it. People typically do not read a large number of emails they receive, due to a variety of reasons including lack of interest or time.

To sum it up, you should consider yourself very lucky if you consistently get around 5 -10% open rate for your emailers and if you hit 20% or more, you should be in email marketing heaven!

12. Google is the only way to advertise online
Ok. So you have got some budgets for getting visitors to your site and you decide to put all that into Google’s Adwords program. Why? Because everyone else is doing it?

Wrong.

Most of the bigger web properties have their own sales teams and would at best be running Adwords ads as a backup, to finish off surplus inventory. So, it is likely that the target audience you are looking for – particularly if they are not the adventurous types - may not be even seeing your ads if they are run only on one network.

Even if you are looking for ad networks, - services that place your ads on multiple websites, there are a number of other ad networks out there that you need to explore, if only to find out if any of them would offer you a better deal. And chances are that you may even get better targeting, better click-throughs or even better conversion rates.

13. Adsense will make me rich
This is the other side of the “Google is the only ad network” argument. There are any number of content creators, publishers and aggregators who believe that all they have to do is subscribe to Google’s Adsense advertising program and their site will be full of ads and they will be laughing all the way to the bank.

They are partly true. Their site will be almost full of ads (There are some limits to the number of Adsense ads you can serve per page). But it is highly unlikely that your banker will have to deploy extra manpower to keep track of your account.

To put it bluntly, it is highly unlikely that you will even break even with just Adsense. Adsense is designed for Google to make money, and for small time websites to get some pocket money. It is not for businesses that will depend on online advertising for significant revenues.

At best Adsense can be used by small websites that cannot afford their own sales teams or to fill in unused inventory and generate a supplemental income, something that will not even make a significant difference to your P&L. You will need your own sales team to bring in advertising revenues if that is your business model.

14. People will buy stuff online
There is a lot of retail happening online and you should easily get a small percentage of that pie. Right? Lets get our facts right first. According to internetworldstats.com, just 3.7% of India’s billion population had Internet access in 2007. And a Survey by Visa in November 2008 across six countries in Asia Pacific placed India fifth in per capita spends online.

And what do they buy online? According to the same Visa survey, “In India, purchasing digital downloads was the most popular form of consumer e-commerce. Seventy-six percent of respondents from India, the highest among Asia Pacific, have bought a form of digital entertainment over the Internet in the last 12 months. Music downloads (63 percent) emerged as the most popular digital entertainment purchase”.

What else do they buy?

Going back to the Visa survey, the top three on the list of transactions online are airline tickets, travel agents and travel accommodation.

How much was it that you were planning to sell online?

15. Collecting payments online is easy
Payment gateways make life easy for the online seller. Or that atleast is theory. Practice like with everything else is slightly different. First you need to tieup a payment gateway. And if you are a startup or a small business, then your problems start there. Banks that provide payment gateway services demand a hefty deposit or a large enough transaction commitment that straight away rules out the option for smaller business. And options like Paypal are not really popular this side of the ocean.

By the way, have you taken online fraud into consideration? Or the cost of providing for security against online fraud?

16. Visitors will create all the content I need
There are quite a few websites that thrive on content that visitors create. Digg for instance is solely about links that users provide and comments that others provide. So does Stumbleupon and Technorati. Facebook, Flickr, youtube and Orkut depend completely on user generated content. All of them have fabulous valuations. Digg for instance had a valuation of over 300 million dollars, before it fell to around 200 millions due to the tough economic conditions. The problem is in the business model. Almost all of them are struggling to develop viable business models. The only viable business model seems to be that some one else buys them out for their user base or user stickiness. Digg in particular has had buyers (Google) walk away during the late stages of negotiations, and Kevin Rose now says that they have the best ever 12 month roadmap now!

Another fact to keep in mind is that for every user generated content site that makes it big, there are a few thousand others that bite the dust. Even as Youtube did a 1.65 billion dollar sale to Google, hundreds of video hosting sites bit the dust, unable to get enough users. For every Stumbleupon that succeeded, the number of those who stumbled along the way are simply too large.

Users will create content, but only a handful of sites have managed to get momentum from that.

17. I can pull all the content I need from other web sites
This is the other side of the user generated content coin. This can be as screenscraping, or as subscribed webservices.

My concern here is not just with copyrights or fair use. Pulling content from other websites is the surest way of ensuring that you loose search engine traffic.

Why?

Search engines (read Google, as the others do not reveal anything about their ranking methodology) rank pages according to authority. A page that puts out a given piece of content (article, news, etc.) first is taken as the original and all others are taken to be copies. The original gets highest authority and copies get lower authority. And if a website is seen to be consistently “copying”, then search engines have been known not to crawl them as frequently and also not to list them prominently in search results.

So, think thrice about business models that relay on content from other websites.

A recent outage that we got away easily from

I was getting ready to call it a day, when I got an SMS saying that our servers were down. A quick call to Binesh and we were up checking what was wrong. Unable to reach the server, we decide to reboot it. This server is hosted at Serverbeach and they provide a tool for automatic reboot. Over to the login page, only to find that that is also not accessible. Even the “mail Serverbeach” page is inaccessible. We have another server at Serverbeach and a quick check confirms that that too is down. By now panic sets in. Having a server down is one thing. Having all your servers down is alarming. having your datacentre down is disaster. A datacentre has multiple levels of redundancy and if it goes down completely , it has to be some thing serious. We hunt down the helpline number to find out what has happened when luck seems to be with us and we get an alert that the main web server is up again. Check it and yes, indeed the website is up as if nothing has happened. Meanwhile the other server is also up, but the application had shut down, requiring a restart. Easier if we can login to our account at the datacentre. While the home page for the datacentre is now up, we cant login. Tried to chat with the site operator (they have liveperson implemented) and here is what I got : jenriquez: there is a known issue in our Virginia datacenter and our engineers are looking into this How long will it take? Dont know. we will post a message at the serverbeach blog. It is midnight here, should I wait? we will restart the server. But the server is up; the application has to be restarted.... <No response.> ? <No response> I give up. Waited for an hour, intermittently trying to login to the account or find the post at the forum. Finally went into chat mode again and got a URL for the forum posts. Turns out that the url was wrong! Asked again and this time got the correct URL. It is 1:32 in the morning by now and my last thought for the days is that whoever thought that managing a website is a 9 to 5 job does not know what they are talking about! (this content is from the DARE blogs)

18. Managing a web site is a 9 to 5 job
A website is not like your regular storefront that you shut down after business hours. It is more like an airport hotel that has visitors checking in and checking out round the clock and has maintenance work going on all all hours. Remember that visitors to your site can come at all hours and from all corners of the world. So, you cannot afford your servers to be down at any time.

Typically, you set up alert mechanisms that send you an sms when your servers are not reachable or when the applications running on them are slow or not responding. And this SMS can come at any time of the day. They do not respect any 9 to 5 schedules or weekends or holidays. I personally have lost count of the number of times I or others in my team have been woken up at night with an SMS saying that one or more of our servers are down or not responding as they should.

19. You can scale your business constantly
Most web based business plans that I have seen rely on constant and steep scaling of visitor numbers, page views, transactions, what ever.

Most of the time, this does not happen. Visitors to websites increase in steps and not in a steep growth line. Why? Because it takes time for people to get familiar with you site, because it takes time for you to get your search engine indexing right, because it takes time for people to start adding your pages to social book marks.

And finally because online browsing and buying habits have a seasonality to them, and you cannot always be the flavor of the day, even if you are dealing with alltime favorites like Bollywood or porn.

Source:www.dare.co.in