As a retailer, you already know the importance of having a Web site. Maybe you already have one. Some retailers I talk to agree that they should “have a Web presence” but have not yet taken their e-commerce business seriously enough to take it to the next level. However, there is a change coming in the economic climate, and retailers who don’t invest in their Internet business are headed for a rough time.

Here are some quick facts to be aware of:

Many retail stores are forecasting lower sales in their brick and mortar establishments for 2008.

However, the National Retail Federation just published a forecast for e-commerce sales in 2008. They is up 17%, growing that sector to a little more than $204 billion.

Nielsen Media Research (the company that measures what people watch on TV) predicts that in two years advertising dollars spent on the Internet will exceed advertising dollars spent on television. It is actively restructuring its company to measure the Internet.

In addition, there are tons of consumer surveys that tell us that consumers prefer to look online first before they go to a store. They expect a store’s Web site to offer the same products as the store and in some cases even more.

Surveys also show that customers who purchase on the Web are more loyal. When they find a site they like to buy from, they visit it often and make repeat purchases at regular intervals.

What You Can Do About It

Okay, so we know the demand is there. Now, how do you prepare for it? How can you set up your retail business to win on the Internet? For many, this is a scary proposition. There are lots of horror stories out there about failed Internet businesses, runaway expenses, and confusing techno-speak that have many retailers thinking that they can never succeed online.

While there are no guarantees that your Internet retail business will succeed, the odds are more in your favor than you think. Typically the initial investment can be small, and there are more resources available to you today than ever before. It is no longer difficult to link your Web site to your point-of-sale system, and aside from a few start-up costs, you can be in business relatively quickly.

Before the Nuts and Bolts: Getting the Right Mind-set

Before I launch into the exact steps that you would take to set up your retail business properly on the Internet, let me make sure I prepare you for the road ahead. Opening a store on the Internet has some similarities to opening another brick-and-mortar store.

It’s true that you don’t pay rent for an Internet retail business. Nor do you pay for fixtures, utilities, or any other physical elements that you had to buy when you put your brick-and-mortar store there. Further, when you first open your Internet retail business, you don’t need to buy more inventory (until things take off) and while there is some personnel expense (Web designers, integrators, and possibly marketers), it’s not as costly as hiring store managers, sales staff, cashiers, and stock personnel.

There are two areas that you will have to be prepared to invest in. The first is the creation of the Web site. Your Web site has to be professionally designed and must contain vital features to interest your customers. These features are discussed in detail below. Your Web site’s look and construction are direct reflections of your store name and personality. Just as you took time to perfect your brick-and-mortar store’s looks, you must do the same for your Internet retail store. Take the time to establish the right color scheme, layout, photography, and presentation of the site.

The second area that you will have to invest in is advertising. Be prepared to spend far more on advertising on the Internet than you do for your brick-and-mortar store. At first, this makes many retailers roll their eyes and not want to proceed, but keep in mind that your total expenses for an Internet retail business should be far less than a brick-and- mortar store. As such, although the advertising can be costly, the benefits should outweigh this.

There is one last thing to consider before we get into the actual steps of getting your retail business online. Some portion of your expenses in creating the Web site should be attributed to your brick-and-mortar store. Research now confirms that many customers will go to your site, look around, and if pleased will then visit your store. You will therefore make sales at the brick-and-mortar store based upon the visit to the Web site. This can be difficult to quantify, but it must be considered. Asking customers, “How did you hear about us?” or “What made you come in today?” may help you quantify the effect of the Web site on brick-and-mortar sales.

Building the Perfect Beast

There are literally billions of Web sites on the Internet today. Certainly there have been great developments in the area of Web design over the past few years. Some of these developments are meaningful for retailers, some are not. Let’s separate the wheat from the chaff.

First, there is a vital rule of thumb to remember. Web sites have two audiences: people who can and will buy from you, and search engines such as Google, Yahoo, and MSN. The latter send out programs (called spiders or sometimes bots) that will “read” your site and report back to the search engines, what they believe to be the topic(s) of your site. These programs collect data that tells the search engines where to rank you when someone searches for something that your store might carry. But these programs have limitations: They cannot watch video and they cannot look at pictures. As such, you need to make sure that your site has more than just pretty pictures or great video. The search engines need to read the text that you have on your site in order to figure out who and what you are. Sites that are all flash animation and graphics have a tough time getting noticed by search engines.

This means that your site must be balanced, through all the pages, for both buyers and the search engines. So many retailers tell me that they want their site to be “clean,” which usually means free of a lot of busy text or images. From a design or aesthetic sense, I agree. However, the most popular sites on the Internet right now are very, very busy. They are loaded with lots of choices for consumers to click on, and tons of descriptive text. The Internet is a different place and has different rules.

This is probably due to the short attention spans that exist online. Per survey, a Web site has somewhere between 5 and 20 seconds to grab the interest of a visitor. If it doesn’t, that visitor will go somewhere else. Busy sites give a visitor more choices, and more places to explore and find what they’re looking for.

In addition, there are several other features that have become important to retail sites. These are:

Product reviews by customers. Leave a space for customers to comment about the product they’ve purchased.

Email a friend. Provide a button for customers to send their friends a link to that item.

Wish list.

Rollover images to larger images. Yes, it’s true; customers just want to slide their mouse over the image to make it bigger and not have to click on it.

Lookbook. This is a special area of the site, where an entire outfit might be put together, such as a blouse, skirt, shoes, and accessories. If the customer likes what she sees, she can click on it and choose all of the items in the picture.

Integration with your POS. Customers expect to find all the products you sell on your Web site. You’ll find that this is hard to do unless they are already integrated.

Great product photography. If you want them to buy, you need to show them great pictures that really sell the product.

Free Ground shipping. Too many others are doing it now to ignore it. However, you can set thresholds, such as having to purchase at least $100.

A Beautiful Web Site Is Only the First Step

Okay, let’s assume that you’ve put together a beautiful Web site. It exists, it’s on the Internet, and people can get to it. You’ve told your buddies about it, perhaps promoted it to some mailing lists you’re on, and even told Google, Yahoo, and MSN that they should know about it.

Congratulations, you are now but a grain of sand on an endless beach. That’s kinda harsh, I know. But it does make the point.

The existence of the site does not mean that people will go to it. In fact, when you boldly go to Google and tell Google that your site exists, Google will promptly search your site ―in 2 to 6 months. Other search engines will take more or less time, depending on their size and the number of sites they are trying to register.

So the step after the creation of the site is the creation of actual, bona fide marketing to that site. No matter what anyone tells you, no matter how bold the promise or guarantee, nothing gets sold without marketing. This has been true since Roebuck first stood over a barrel in an open marketplace and will be true when future generations operate vending machines on Alpha Centauri.

I often tell people that having a beautiful Web site is like having a gorgeous painting in a museum that no one goes to. Sure, it’s pretty, but if no one sees it, what’s the point? This is where the real work of it comes in.

You may be thinking, “Work? Did he say ‘work’? Yes, there is definitely work to this. Selling on the Internet is not free money. It will require, especially when you are learning this new business, that you burn a little midnight oil to understand fully all that needs to be done to get a noisy marketplace like the Internet to take notice of your new enterprise.

Marketing on the Internet is not like other marketing. The good part about marketing on the Internet is that there is a large audience, and does not cost as much as traditional marketing. The bad part is that the audience is, in fact, so large that getting noticed requires a better-than-great understanding of how to drive traffic and ultimately buyers to your site.

Marketing Isn’t Just One Thing

Most people agree that they have to market their Web sites. Many are willing to take a crack at it. Few do enough of it, which is why so many people who want to make a living on the Internet end up failing.

We try to help as many Internet marketers as we can with this concept. So many of them thought that they only had to do some portion of the full spectrum of Internet marketing. Many of them believe that if they just do a single process, or perhaps two processes, they’ll generate enough traffic to make money.

Here is another place where people get fooled. They buy into some hype that tells them that if they purchase a “magic utility” or subscribe to some “awesome service,” that they’ll get more traffic than they know what to do with.

The hard-core truth is that tons of untargeted traffic, if it really does make it to your site, isn’t of any value. If you are selling camcorders, 10,000 hits to your site might sound nice until you find out that all of those hits came from second graders whose allowance doesn’t stretch that high.

Marketing your site means applying a variety of tools to ensure that people know about your site, get interested in your product or products, and want to go to your site and buy them. Effective marketing should create this result.

This means that you have to get involved in all (yes, all) of the areas of marketing on the Internet. The short list includes email marketing, article marketing, press releases, pay-per-click advertising, blogging, social-media posts, getting other pages to link to you, and search engine optimization.

In that last paragraph, I rattled off eight different activities. All of them are important. Certainly some are more important than others when you consider the vast differences in Internet business models, but successful Internet marketers use all of them to some degree in all the sites that they promote. They do this because they know that traffic does not come from just one place, it comes from many places. And you have to create as many opportunities for that traffic to make it to your site as you can. The more portals to your site, the more potential buyers will find their way to you, and the more profitable the site will be.

SEO vs. SEM

You’ll hear these two terms thrown around a lot. Let’s get some good definitions for them so that you know what they are, and what they do for you and your site.

SEO stands for search engine optimization, and it is the activity of improving various elements of your site so that the search engines like your site and list you as high up as possible.

SEM stands for search engine marketing, and it includes various activities to market your site to active buyers. Search engine marketing includes such things as email blasts, pay- per-click advertising, and article marketing.

Many Web designers tell you that they’ll “optimize” your site for you. Be careful! Optimizing a site is done with very specific tools, and should always be done for a specific keyword phrase. So if your Web designer says he’ll optimize the site for you, and he doesn’t ask you which keyword phrase he should optimize on, then he is not doing anything for you.

When your site is first launched, SEM is far more important than SEO. SEM will drive buyers to your site, and that’s vital in the beginning. It’s also more efficient, more direct, and more proactive.

SEM Activities

Here are some great ways to market your site right off the bat.

Email Marketing. Email is still free, and sending email messages to clients is a great way to get them to your Web site. There is a tool that should be part of your Web site called an autoresponder. This is a utility that enables you to send email messages easily and efficiently to your customers. Autoresponders can send a series of messages to potential customers at intervals that you choose. For example, you can put a note on your site that says, “Register on our site and get our free series, ‘Ten Fashion Tips for Spring.’” Then, every few days, you can send them a new tip. It causes your store to be on the mind of the people you are sending these messages to. In the earliest stages of your site, email marketing is probably your most effective tool.

Information Article Marketing. This is a great way to get potential customers to know you better. With this type of marketing, you write informational articles about your industry and publish them to the various article directories on the Internet. When readers find them, they’ll learn something, get to know you, and visit your site. It also establishes some trust in you, as you become an opinion leader who has been published. There is no cost to sending out these articles, and it does put your name out there on the Internet.

Press Releases. This is another type of article marketing. Press releases are similar to information articles, except that there is a definite time frame to them. You can issue press releases on the Internet for about $40 per release and they will drive traffic. Find reasons to issue them, such as the launch of the site, a special sale, or a special event you are having.

Pay-per-Click Advertising. This is one of the biggest topics in Internet marketing, and it goes far beyond the scope of this white paper, but we can get some basics understood. Pay-per-click advertising (PPC) is an extremely effective way to get targeted traffic to your site. It’s also one of the more expensive methods, but done correctly it will more than pay for itself. In pay PPC, you bid on keyword phrases that you think customers would type into a search engine to find you. Each time a customer types in that phrase, your ad has a chance to appear. If it does, and if the customer clicks on it, then you pay for that ad. Each click can be as low as $.05, and has high as $10. But before you panic, there are lots of rules to this to keep you from going broke while working in this area. If there is one area that requires mentoring and supervision, it’s this one. You wouldn’t buy stocks without a stockbroker, right? Don’t go here without someone who understands this business and can answer your questions fully.

King Arthur Had Merlin, Luke Skywalker Had Obi-Wan Kenobi

One of the most mystifying things about Internet marketing for me is the sheer number of people who believe that by reading a few e-books or by watching a couple of videos, or attending a couple of weekend seminars, they can become the next Amazon.com. This business, like all businesses, requires education, and after education, it requires good mentoring.

No matter the profession, and no matter the amount of training that someone has in that profession, when they started there was someone there to mentor them. A sage who had “seen it all” and could offer guidance, wisdom, and experience. Every profession on this planet includes this. Internet marketing is no different.

When I hear someone tell me that they are going to learn Internet marketing “on their own,” I know that person’s business is headed for the scrap heap. If you remember only one portion of this report, remember this: You need a mentor to guide you, to keep you out of trouble, to show you what works and doesn’t work, and to be there when you fall down and need someone to dust you off and get you back on the road to success. Without a mentor, you are a babe in the woods and the wolves will have you as an easy, tasty treat. These wolves will fool you with fantastic claims of things they can do for you, then they’ll take your money and run. Sadly, I know many stories like this.

When we mentor people, we are careful to tell them that the Internet is not a get-rich- quick scheme. Internet marketing is a business, like any other business, and it requires patience, planning, guidance, planning, perseverance, planning, cleverness, planning, effective marketing, and planning. And did I mention planning?

So choose your mentor wisely. Your third cousin who is a guy who “really knows about computers” is not necessarily a good mentor. The world of computers has become so vast that there are certainly now areas of specialization. Find a mentor who specializes in the area of creating, marketing, and working in Internet businesses.

Other questions that you should ask a potential mentor:

1. Are you available for questions? What good is a mentor who won’t talk to you? There are many who claim to have written great materials on the topic, but you need to have someone who can answer your questions, and unravel you when you get confused.

2. Will your mentor help you put together a plan to succeed? This business requires planning (I’m pretty sure I mentioned that above). If you don’t have a good plan, don’t start until you get one.

Summarizing the Essentials

Let’s get down to the simple basics, now that you’ve heard what can go right, and what can go wrong. Here are the essential elements of any successful Internet business:

Great Web site. Take the time to study what your competitors do and what you want your site to be like. Go over the features listed above and decide which ones are critical for your operation. Get several quotes from Web designers, and have them show you a portfolio of work they’ve done. This should take three to four weeks to execute.

Great Education and Industry Knowledge. Remember that Internet marketing is a business, no different than aerospace, retailing, or window-washing. There are techniques that you must learn. Invest in yourself and you can make it happen. Trying to do this without learning the ropes will be deadly and/or expensive.

Great Marketing. Ensure that you take all the elements above and run with them. Work each element of the marketing to its finest potential and get your message out.

Great Mentoring. If you have not been in this business before, or even if you have, unless you’re making your living at it, find someone who knows the ropes and let him help you. Great mentors save you a ton of time, aggravation, and expense. They’re worth every penny.

Internet marketing can be a fun, rewarding, and lucrative adventure. We wish you tons of success.