Site   Web

May 1, 2007

Small Businesses Should Know Their Place Online

The online environment has dropped a number of barriers for the creation of new businesses. Before, the dream of “sticking it to the man” and starting a business of your own was a lot more difficult and burdensome, requiring planning for location, financing and a host of other issues.Online; however, the roadblocks to starting a business of your own, even if just happy to produce additional income, are far less severe. While that has been wonderful for commerce, it also has its downsides. Namely, the lack of planning in order to build a successful business.

The world has always had mom and pop shops. In fact, many great corporations started out as just that.Wal-Mart, the largest retailer in the United States, started out as “Walton’s Five and Dime“. These corporations were led by people who dreamed of being much more than an owner of another mom and pop store and through their leadership they built their businesses into empires. But not all mom and pop shop owners have such big dream or ambitions. In fact, many are content with their role in the business world and have no desire or ambition to be more than a mom and pop shop.

At least until the internet changed the face of business online. In a way, it leveled the playing field. Mom and pops could compete in ways they never could before. In fact, it seemed to be the mom and pops that fueled the growth of the internet. Due to their smallness and flexibility, they were the first ones to really use the internet as a sales channel. The corporations lagged far behind for many years.

The Internet allowed many mom and pops to move out of mom and pop status and develop a new kind of corporate identity. Jeff Bezos started a small online store to sell books and turned it into the behemoth known as, one of the largest online retailers in the world. Many other mom and pop stores enjoyed the ease of which they could develop a web presence and draw in traffic and sales. But as the e-marketplace began to grow, driving traffic to a new online business became increasingly difficult. While starting a business on the internet today is still relatively easy compared to doing so off-line, it has become more expensive and time consuming than ever.

I had a conversation with a friend recently about the rising costs of search engine marketing, optimization firms, and consultants. It seems that the cost of SEO is getting out of reach to the mom and pop business owners. Many well-known consultants charge up to $500/hour. One hour can get you a lot of advice and good information, but that leaves the hard work up to the business owner. If you hire a web marketing firm you might end up paying anywhere from $10,000 to $100,000 per year. $10,000/year is considered relatively cheap.

These costs for marketing are making the online environment less viable for new businesses on limited budgets. It’s certainly not impossible. Those that can and will invest the time to learning what they need to know and then dedicate the time and effort to the implementation of their knowledge can still succeed online. But the more competitive the field is the more difficult and time consuming the marketing aspects become, especially for one who may already be tapped out trying to run the business.

So while smaller businesses could initially enjoy easy success online, that is no longer the case. Unfortunately, many still have grand dreams of starting a business in a competitive field and instantly turning it into a thriving company. By and large, that’s not going to happen. New sites take more time than ever to rank well in the search engines as trust and reputation need to be established. This is especially important when competing against other companies that have spent years developing their trust and reputation online. There is really no reason why a new site should outperform an older site in the same industry, until that new site has been able to prove they are valuable, reputable, trustworthy, and unique. And not just because the owner of the business says so! These things have to be well established online.

So what’s a mom and pop store to do? That answer depends on what the goals of the business owner are. Are you comfortable being a mom and pop shop or do you have bigger dreams and ambitions?

Staying Mom and Pop

If you’re fine being a mom and pop shop in the online market place then you need to recognize that your place is probably not among the top 10 search results in a competitive industry. There is nothing wrong with that, just like there is nothing wrong with a local hardware store not being a Home Depot or Lowes. The local store gets locals who don’t want to take the drive to the larger hardware stores. But we all know that the Home Depot gets a whole lot more business than the local store.

Even online, mom and pop stores need to be content with their place in the business world. You realize that you’ll never own the largest store of your kind offline–nor do you want to–and you should also accept the same online. You don’t need to be #1 to run a successful mom and pop business.

Now, if you have greater ambitions than just being a mom and pop store, well, that changes everything. But before that changes your desire to be on the first page of search results, it needs to change your drive, motivation, and financial investment as well. You need to apply some of the same off-line business starting strategies for your online store. This includes creating a business plan, having a USP, and perhaps even finding some financial backing or outside investors. Again, this is most important for those starting a business in more competitive industries.

While the barriers to starting a business online are still less than starting one off-line, the mindset of success shouldn’t be. Succeeding in any environment and earning first page placement for your keywords requires much more than building a website. It requires time, determination, willingness to spend or learn more about marketing, and patience. There are very few overnight success stories online and those that there are usually come from new and innovative ideas.

There is nothing wrong with finding something you can do in order to build your business, even if it’s already being done. Target and Wal-Mart compete with many of the same, or similar, products and you can too. But you need to know what drives you and what your motivation is and how you define success. Once you know this, set your online expectations accordingly. You don’t have to invest thousands of dollars in a marketing campaign in order to be successful online, but if you want to move out of mom and pop status, then you need to be willing to run and invest in your business as any other non mom and pop business would.

Author:  Stoney deGeyter leads a spectacular team of seasoned marketing experts at Pole Position Marketing, a search engine marketing company. Stoney started PPM in 1998 by finding the brightest minds in the industry and nurturing within them an intense desire to become leaders in their respective fields. With this team of professionals, he has built a wildly successful website marketing company that succeeds through both personal and professional integrity.