Using non-core products as a loss leader!

June 11, 2008 | 1 Comment

One of the best ways (If done properly) to add additional revenue to your ecommerce sales is to sell non-core products (at cost or even at a loss) to gain additional core sales and new customers.

A great example that I found this weekend, is B&H Photo. They sell a variety of non-photography related computer and technical products. What quickly caught my attention is that many these products are being sold well below any other online retailer's price, even cheaper than anyone on eBay. I don't have access to wholesale computer accessory costs, but I imagine that they aren't making much money, if any, on their computer product sales.

So how is this smart marketing?

When an established website like B&H draws sales from non-core products, they gain additional customers and brand exposure. What they gain by selling at cost, is the opportunity to sell other products for profit, and they gain repeat customers. In the end, if the amount of money spent marketing and supporting non-core products is minimal, there is absolutely no downside to this practice. If they aren't making money from those computer related sales, they're making money from those additional customers that are also interested in cameras, memory cards, photography accessories, and more computer accessories.

A good idea for some but not for everyone:

This practice can be a strong marketing technique, however, it will not create a sustainable business model for everyone. A businesses that can most effectively harness this technique must have a strong search engine presence, or the ability to draw sales and traffic at little to no additional cost. This technique is probably not a good idea for a startup business unless you really know what you are doing. A business must also have access to related but non-core products at a very competitive price.

Obvious potential pitfalls:

  • Some strong reserve must be used to not cannibalize existing profit margins, as it extremely easy to sell short on everything. Don't make everything a loss leader, only those non-core products that you are adding.
  • Another danger is accidentally migrating from one core product type to another. It needs to be clear to yourself and to your customers what your business is there to do. If you are a photo shop, that sells some computer accessories, it should be clear that you are not a computer accessory seller that has some photography equipment. This is absolutely key in protecting your brand, and sustaining your business model.
  • The other products that you decide to sell must be related to what your business does. If would make no sense for an online flower shop to start selling car parts. You need to be careful not to dilute your brand, message, and what it is you currently do with completely unrelated products.
  • You do not ever want to enter an arena that will create a lot of additional customer support requests. This is a quick way to nullify any gain you get from additional customers and sales.

The big picture:

It's sometimes difficult to grasp the concept of loosing money on one place to gain money in another. If you have the ability to step back and look at the big picture, you will find that there are numerous areas where a loss here can create a huge gain somewhere else. Small steps should always be taken when testing out a system that has both the potential for a loss and a gain, but I think that many will find that this is a useful, appropriate, and completely possible marketing technique.

Posted by jestep | Filed Under General, Marketing 

Don't lose sales from these 5 stupid mistakes!

June 9, 2008 | 1 Comment

Some of the most simple mistakes will undoubtedly lose your website sales. What's most unfortunate about these mistakes, is that you probably had a guaranteed sale until you irritated or scared your customer enough for them to find another store to shop at.

Mistake 1 (Old dates and information):

The internet is a very dynamic machine. When a visitor shows up on your website and sees your copyright date "Copyright © Anything < This Year" it instantly brings up questions. Are these prices still correct? Is this company even in business?

Unless your website has an enormous amount of perceived trust and you have a very strong brand (in which case your copyright date would most definitely be current), you will undoubtedly lose sales from this date alone.

The same thing goes for about us pages, and other information pages that can be date specific. If your about us page states that you specialize in computers with Windows 98, and Windows 2000 while Windows Vista is the current release, it brings up questions to which there is no good answer.

Mistake 2 (SSL related error messages):

I come across sites on a daily basis that serve up secure pages with some problem in their SSL configuration. When you send a visitor to a SSL protected page, there is a good reason for it. And, when an error message precedes that secure connection, all confidence in your security is lost. If you can't figure out how to properly encrypt a website / page / sub-domain without errors, you need to hire someone who can.

Does this make you want to continue checking out?

Also, to help prevent this from ever happening, make sure you do not permanently install mis-configured ssl certificates. If you do get a ssl error, make sure not to click the permanently allow this connection option.

Mistake 3 (Not showing payment and shipping options immediately):


You should display your accepted payment methods on every page of your website! Don't make your customer click on the about us, faq, or any other link to get this information. I've got securely hosted credit card logos here, if you need them.

You should display the shipping options and prices as soon as technically possible, on the shopping cart page is best! Also, do not make your user enter all of their shipping or billing information, (or worse yet, make them register) before you give them shipping prices. Much of the time, your customer won't even consider filling out that much information just to get an idea of how much shipping will cost.

Use a single zip field to calculate shipping and ask for the rest of their information further in the checkout process.

Mistake 4 (Improper add-to-cart functions):

With the Web 2.0 craze going on, it's common to see spiffy Ajax and dynamic add to cart functions where some small area of the website is updated when an item is added to a shopping cart. This is not only a bad idea, but it can be usability suicide.

While these actions may seem obvious to you, a lot of users don't notice a small box being updated, and it's rarely what a shopper is expecting to happen. It's always best to redirect your user to a shopping cart each time they add something to it. You can then provide a return to last item / category / brand or whatever else link from the shopping cart page as needed.

Mistake 5 (Poor internal search):

Google became popular because their search results were quick, and highly relevant. Search function on your website is extremely important, and should be quick and relevant. You need to be able to account for things like misspellings and incomplete words. If you don't have the ability to implement a solid search function yourself, you should look for a 3rd party application to use. If your website is well indexed, Google offers a custom search engine that you can integrate into your website.

The only thing worse than showing bad search results is showing none at all.

Posted by jestep | Filed Under Development, General, Usability 

Obfuscate email, but make your self email-able

May 15, 2008 | 5 Comments

Using a simple obfuscating script on your website's published email addresses can reduce the amount of email spam by 90% or more. Email spam primarily comes from email harvesting bots, similar to search engine bots, that scour the internet looking for email addresses to spam. There are several ways to obfuscate email addresses.

Common methods to obfuscate email addresses:

  • Encoding
  • Javascript
  • Flash
  • Using an Image instead of text

Javascript and Flash obfuscation basically create a text version of your email that cannot be read by all but the most complex email harvesting robots. These methods work well at stopping email harvesting (Flash is far better than Javascript), but your visitors must have flash installed or javascript enabled for these to work or they too cannot see your email address.

Example of what a Javascript email would look like to a computer. (From: seowebsitepromotion.com)
<script type="text/javascript">
//<![CDATA[
var email = "questions"
var domain = "ecommerce-blog.org"
document.write("" + email + "@" + domain + "")
//]]>
</script>

These can also be called externally or through an action script which is even more effective.

Images of an email address can be used in place of text. While this is probably as effective at stopping spam as flash and Javascript, it completely prevents copying the text. This makes it very annoying to try and email the site owner as contact addresses are often long and can be complex. Users are very prone to mis-entering email characters and this generally leads to frustration and annoyance by everyone. I recommend not using this method.

Encoding is by far my preferred method of email obfuscation. While it is not as effective as the other methods, it stops the majority of spambots. It does not create browser compatibility or usability issues. It is as easy to use as copying and pasting some html onto a web-page when it is being created.

Encoding can be done with a hex, decimal, and others. HTML interprets these encoded characters as the ones we see and read. This way your visitors sees an A while a computer sees an &#x41;.

Some good encoding tools:
http://www.ianr.unl.edu/email/encode/ - This is a simple and very effective encoding generator.
http://www.seowebsitepromotion.com/obfuscate_email.asp This script offers a variety of encoding and javascript obfuscation techniques.

Email Obfuscation Comparison:

Method Usability Effectiveness Difficulty
Flash Bad Extremely Good Hard
Javascript Ok Very Good Medium
Image Bad Very Good Medium
HTML Encoding Great Good Easy

Posted by jestep | Filed Under General, Usability 

Google Introduces Google Checkout Shopping Cart

March 24, 2008 | 7 Comments

Google released a beta service today called Google Checkout Shopping Cart. The cart is a very simple javascript based cart that integrates into websites and the Google Checkout payment service. The entire cart uses a new shopping cart API and only needs a few lines of code on a website.

Google Checkout Shopping Cart

The checkout process uses the existing Google Checkout system.

Google Checkout Page

This cart looks to be an extremely easy way for websites to add shopping cart and payment functionality. It looks like it could be customized as much as a website would want, but seems to be a better fit for websites wanting to sell only a few items.

I think that this could really help Google push their checkout service, as it has all but died since they gave up their free incentives.

Some Google shopping cart links:
Google shopping cart demo
Getting started with Google shopping cart
Shopping cart API documentation
Shopping cart customizing
Shopping cart FAQ's

Posted by jestep | Filed Under General 

Enterprise open source firewall appliance software!

February 14, 2008 | 1 Comment

I needed to setup a content filtering firewall a few weeks ago for an office of about 50 people. The existing firewall was a Sonicwall Pro 4060 which is a very solid firewall and is more than adequate for 50 computers. Sonicwall also has a content filter application that installs on the Pro 4060. The drawback to using Sonicwall's filter is the price. Their filter is billed on a recurring yearly subscription, and would cost about $2,000 per year to use. $2,000 per year was far beyond the budget for such a project, so I went to look for an open source or lower cost setup, hopefully without any annual fee. My first thought was a custom Linux-Debian computer made only to function as a firewall. After some research and a few recommendations, I found a great out-of-the-box Linux operating system, Untangle, that is designed specifically for dedicated firewall applications. This was a much better solution that custom configuring a Linux server.

The following is a quick guide on how to setup a Enterprise class firewall for a small to medium sized business. How good your firewall performs is dependent on the hardware that you use, but if you copied the specs of the one that I setup, it should easily handle 100+ computers and servers.

Tyan transport GS14

Continue reading…

Posted by jestep | Filed Under General, Networking, Security 

How to properly use promotional products

February 11, 2008 | 6 Comments

Promotional products are something that many businesses use, but few use effectively. I get bags full of pens at conferences, but rarely do these ever incline me to deal with that company ever again. Chances are most promotional product use, ends with similar results.

There are a few key factors in making promotional products work.

  1. Give people something they want!
  2. Don't skimp out!
  3. Design them properly!
  4. Quality targeting is more important than quantity!

Continue reading…

Posted by jestep | Filed Under General 

Starting a new business, 5 reasons to avoid Microsoft now!

January 15, 2008 | 4 Comments

If you are a new online business owner, one of the best pieces of advice I can give you is to not become a whore to Microsoft, their high cost, and their ludicrous licensing system.

Since most of us started with Microsoft Windows it's natural to assume that they are the only viable company that can provide software for our business computers. What you will find especially if you can grow into a medium size business with several employees, is that Microsoft is truly an evil company, and your business is far better off without them. I don't just mean that your web server should not be running Microsoft, but if you have the capacity to, I recommend not installing a single piece of Microsoft software in your entire business.

There's millions of people that make the Microsoft sucks claim, but here's why you should avoid them with your business: Continue reading…

Posted by jestep | Filed Under General 

The myth of tax free internet sales

December 12, 2007 | 4 Comments

It has been a long held belief by most online shoppers that out of state internet purchases are tax free. I have to admit that I believed this for a long time myself, but unfortunately it's not the case.

Just to dispel any theory dissolving that old 'Death and Taxes' quote, internet purchases are not tax free. That's right. As the wording goes, most internet companies don't have to collect out of state sales tax. However, consumers, businesses and any end users still must pay a "Use Tax" on non-taxed purchases that they make through mail-order or online.

Most states currently have Use Tax which specifically requires consumers to pay their state sales sales tax on purchases they make online that are not taxed by the business. There are some exemptions for certain types of products and for states that do not have any sales tax, but for the most part taxes on these purchases are required to be paid to your state government. With the exception of very large purchases, use tax is rarely if ever monitored, as it would simply be an impossible feat for any state government to handle. However, we can all be sure that states are losing out on millions if not billions in uncollected taxes, so if you aren't paying them, enjoy the free ride while it lasts.

Here's a Use Tax table that I came up with covering which states require it:
(Let me pre-apologize about all of the PDF links here, Government websites are about as bad as they come,and in many cases PDF's are all that's available.)

Continue reading…

Posted by jestep | Filed Under General 

Get an awesome computer for really cheap!

December 5, 2007 | 1 Comment

If you are in the market for a new computer, but you don't want to drop a couple grand, here's how to get a really good one for under $500.

Go to eBay (of course) and look for a Dell Precision 450, 470, 650, or 670 with dual processors. These computers can run dual hyper-threading Xeon processors and usually come with XP Pro installed. You may need to buy some more RAM but otherwise a Dual 2.8Ghz (HT) computer will run under $500, and if you have time to bid rather than buy you may find one for under $300. Dual Hyper-threading roughly equates into four processors total.

Since these computers are essentially servers with XP on them, they should last a long time. The processor / chipset combination is rock solid, and you will be hard pressed to find a comparable computer for the price.

Posted by jestep | Filed Under General 

Spam-proof your dedicated server!

November 13, 2007 | 1 Comment

I wrote about a great cpanel firewall add-on that I found a while back.

The same company that designed configserver firewall, has two security packages that are designed to help maintain a cpanel/whm dedicated server.

I recently purchased the "cPanel Service Package + MailScanner" package for one of the servers that I manage.

Here's what you get for $125:

  • iptables SPI firewall (csf)
  • Login failure detection (lfd)
  • Stop unnecessary processes
  • Logcheck
  • Logwatch
  • WHM configuration check
  • OpenSSH configuration check
  • Install and configure Rootkit Hunter
  • Install and configure Chkrootkit
  • install mod_security
  • Host spoof protection
  • Operating System check
  • Name server configuration check
  • Disk check
  • Kernel check
  • Apache tune and check ***
  • MySQL tune and check
  • Enhanced log rotation
  • Day of the week backup rotations
  • Secure /tmp /var/tmp /dev/shm
  • Install and configure ConfigServer Explorer (cse)
  • Install and configure ConfigServer Mail Queues (cmq)
  • Install and configure ConfigServer Mail Manage (cmm)
  • Perl installation check
  • Delete unnecessary OS users
  • Disable open DNS recursion
  • Enhance path protection
  • Remove SUID/GUID from binaries
  • PHP hardening
  • Exploit check
  • Disable vulnerable phpBB installs
  • Initial cPanel configuration
  • Enhance MailMan performance
  • Install MRTG graphs
  • MailScanner Server service
  • One week of informational tickets

While this is all great, what really caught my attention was the improvement with the email that the server was handling. Continue reading…

Posted by jestep | Filed Under General, Security 

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