C;>79:ID Z8DBB:G8: FEBRUARY/MARCH 2007 • $9.95

: 1. Getting Started Securing a domain name .Com, .net or other?

I½H>CH>9 2. Web Sites For Service Businesses Why you need a Web site L=6 Ideas to help you get started 3. Selling Products Online Basic steps to doing business on the Using eBay, and Overstock 4. Carts What the options are Tips from the experts 5. Staying Secure Spotting fraudulent credit cards How to Protection from data theft 6. Hiring A Web Developer the Using predesigned templates Harness Tips on selecting a Web site developer 7. Selecting A Web Host Why a host is important Differences among service options Internet 8. E-mail Marketing to Revolutionize Improve communication with customers No special skills are required 9. Search Engines The importance of being found Paid search vs. organic results Your Business www.NFIB.com SUPPLEMENTC1 TO MyBUSINESS MAGAZINE nfib-authorizenet-outlines.pdf 1/4/2007 4:33:08 PM

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C2 NFIB Guide to eCommerce | February/March 2007 2 Our First Small Business Guide A Letter from NFIB President Todd Stottlemyer 3 Contents Domain Name Basics Establishing a name for your Web site is an easy process 5

NFIB Guide to eCommerce is published Web Sites For Service Businesses as a benefit for NFIB’s members. An online presence can help you compete with major franchises TODD STOTTLEMYER President 7 JEFF KOCH Vice President of Member Benefits Selling Products Online What does a business need to launch an ecommerce business? Susan Ridge Vice President of Communications David Silverman 10 Vice President of Sales and Marketing Shopping Cart Options BOB DAVIS 10 steps to making the right choice Director of Marketing RITA TALLENT 14 Senior Marketing Editor/Writer 800-NFIB-NOW, nfib.com Fraud Is a Manageable Risk Two types of fraud for online merchants

Practical eCommerce serves small-to- 16 midsize businesses with sensible articles and advice to help improve their online Is It Time To Hire A Web site Developer? operations. It does this through its bi- monthly printed magazine, its Web site Four steps to pick the right candidate (practicalecommerce.com) and through its free, twice-weekly enewsletter, EcommerceNotes. 18

KERRY MURDOCK Hosting Company Considerations Publisher Many things to consider in addition to price MITCH BETTIS Contributing Editor 21 BRIAN GETTING Online Director E-mail Marketing Easy and Effective TODD JENNINGS Requires no programming skills Advertising Director JÜRGEN MANTZKE 23 Art Director STAFF WRITERS Why Search Engines Are Important Rachel Coleman, John Dozier, Jeff Noble, Ryan Welton What if you opened a business and nobody could find you?

970-257-0606, practicalecommerce.com

Special thanks to Hammock Publishing, who assisted with design, production and coordination matters.

www.NFIB.com  Out of town, or out of country, customers can also shop, compare and then make the purchase online. E-mail marketing is changing the way Our First many small and independent business owners communicate with their custom- ers. An entire industry has developed to help you produce, without any techni- Small-Business cal knowledge, e-mails that add to your customer base and to your bottom line. These e-mails can contain, for example, Guide product images, seasonal specials, new arrivals and company developments. You By NFIB President Todd Stottlemyer can send these e-mails to your customers who request them at a fraction of the cost of traditional mail. This guide would be incomplete with- NFIB members wear guides — written just for NFIB mem- out a discussion of Internet security. We’ll many hats. As business owners, you bers — will be full of practical advice, describe the credit card fraud risks that exist deal with issues as varied as market- step-by-step instructions and free of with most any ecommerce venture, and ing, insurance, purchasing, accounting technical jargon. In short, they’ll help we’ll offer suggestions to mitigate them. and human resources. Increasingly, I you sort out the complex issues that you And there’s so much more. If you suspect, you also deal with technology deal with every day. haven’t purchased a domain name (e.g. issues and how your business fits into a For each of the guides, we’ll collabo- SampleCompany.com) for your business, progressively online world. rate with relevant professionals who will I encourage you to do so. It’s easy, inex- The NFIB Guide to eCommerce will share their expertise with our members. pensive and we’ll offer suggestions in this help you sort this out. It’s the first of our For the NFIB Guide to eCommerce, guide to help you do it. Search engines such new Small-Business Guides, in which we’ve asked Practical eCommerce maga- as Google, Yahoo!, MSN and Ask can help we’ll publish expert articles, tips and zine to address the Internet and ecom- customers find your Web site and can also advice around a specialized topic. These merce issues that we believe are most provide advertising options for your busi- pressing to each of you. ness. We’ll simplify search engines in this Some of you have Web sites already, and guide and in future guides. you’ll find articles in this guide and future I’m excited about the launch of these guides to help you improve your online Small-Business Guides, another example operations. Some of you have yet to migrate of our goal to provide products and ser- online, and you’ll find pertinent informa- vices that help your business grow and tion here that will help you get started. prosper. In fact, most any small and indepen- NFIB members wear many hats. This dent business can benefit from the Inter- NFIB Guide to eCommerce represents net. Service businesses, for example, can our latest effort to help you wear them. establish Web sites with contact informa- tion, hours of operation, rates, customer testimonials, quote requests, photos, vid- eos, appointment calendars and so forth. Restaurants and food-service busi- nesses can post menus, prices and ingre- dients. For retailers and wholesalers, the Internet has opened up a new sales chan- nel. Local customers can shop, compare products and otherwise contemplate a purchase. We’ve seen innovative “mul- tichannel” strategies, in fact, whereby a local retailer will use a Web site to comple- ment his physical location, and vice versa.

 NFIB Guide to eCommerce | February/March 2007 Domain Name Establishing a name for your Web site is Basics an easy process

By Jeff Noble, Practical eCommerce staff writer

Who would have The format of an IP address is written trars below. All registrars are connected thought the domain name Mexico.com as four numbers separated by periods, to the same domain-name . So, would cause such a fuss? where each number can be from zero there’s no need to check multiple regis- It did when a Mexican telephone to 255. This IP address is how a domain trars for a domain name. Hosting com- company reserved the name for its own name is recognized by a Web .* panies* frequently assist with domain use. The Mexican Tourist Board filed But, long numbers, such as IP addresses, name registering, too. a lawsuit with the Internet Corpora- are hard for people to remember. Domain You’ll have a choice of various Top- tion for Assigned Names and Numbers names were therefore created to give Level Domains (TLD) to accompany your (ICANN), claiming that it should be an “alias” to IP addresses so people can Web name. The most popular TLD is the the sole property of the Mexican gov- remember and communicate them better. suffix “.com” but there are others includ- ernment. The tourist board lost. Such It’s easier, for example, to tell an associ- ing .net, .info and .biz. You could get only cases happen every day. ate about a Web site called NFIB.com, the .com, or you could buy multiple names. Domain names are the text you type versus, say, telling the associate about the Non-profit groups can get the TLD .org, into an Internet browser’s* address bar same site that’s at 22.170.12.250. and educational institutions can get .edu. to go to a specific site on the Internet. To reserve a domain name, you reg- For a commercial endeavor, it’s important Known as a URL, (uniform resource ister it (for a fee) at a domain registrar. to get a .com address. The .com address is locater) a Web address looks something We’ve listed the primary domain regis- by far the most used and most intuitive for like this: http://www.example.com. The your customers. According to The Wall domain name is “Example.com.” looking for a vendor? Street Journal, there are about 46 mil- Every domain name, or Web page GoDaddy.com is the world’s largest lion .com addresses compared to the next address, has a corresponding numeric domain-name registrar. Other large most popular suffixes — .net at 6.7 million code that looks something like this: registrars include NetworkSolutions. and .org at 4.1 million. 22.170.12.250. This numeric code is com and Register.com. Prices and Once you register your name, you can called an IP (Internet protocol) address. services vary amongst the registrars. begin the process of creating a Web site. However, if you’re not ready for that, you will also be presented with options to “park” it or even to “forward” it. Parked domain names are registered with the InterNIC (Internet Network Information Center) and therefore reserved, but are not active for Web site or ecommerce service. This is useful if you have a name that you would like to reserve, but do not intend to use immediately. Domain-name forwarding is useful if the company that provides you with Internet access also gives you free stor- age space. You could then have Your-

www.NFIB.com  name.com forwarded to the server of your Internet company. When some- I own 30 domain names. I think up a lot one types your domain name in their of business ideas, and anytime I think browser, it would be forwarded to your of a really good idea, I also think of a Internet server’s space. domain. If it’s available, I register it. Then You can also register your name as when I have time and more resources I a subdomain. This occurs when a ser- may develop those ideas and use those vice offers to let you piggyback your domains. I have several domains related name on their own domain name. It to scrapbooking that I will redirect to would look something like this: Your- Fidjiti.com in the near future. domainname.theirbusinessname.com. Such subdomains are usually free. » LINDA WINEGAR, CEO Finally, you may be wondering who web site Fidjiti.com owns a domain name that is already taken. sells Scrapbooking and card-making supplies You can use WHOIS (Whois.com), the Internet’s domain-name registry, to find out who has registered it along with the name for your brick-and-mortar business. com on the Internet, it’s possible you will person’s contact information. Other ser- Your online identity is important. Most have to consider variations when reserv- vices also offer you the opportunity to people try to get an online address that ing your domain name. make offers to buy domain names that are mirrors the name of their brick-and-mor- already registered. tar. However, in the brick-and-mortar terms to know Getting the right Web address is world there may be more than one busi- important, and you should take it as seri- ness named Bob’s Radiator Shop. Since Browser program used ously as you did when you created the there can only be one Bobsradiatorshop. to view and interact with various types of Internet resources available on the

Domain name Top-Level Domain World Wide Web. and Internet Explorer are two common examples.

Hosting companies A company that uses a to provide storage space for many Web sites.

Web server A computer connected to the Internet where Web pages are stored.

Protecting Your Asset Make sure you get the .com Buy the common misspellings Don’t think about launching One recent study found Get your .com and other addresses that are similar a business without the .com that 13 percent of all traffic Domain names are addresses. Make sure you “own” the name. If you are successful, was coming from typed-in But, of course, a domain name you are setting yourself up addresses in the . name generates traffic, which Don’t just find a domain name for a very rude awakening This means there is a real means it is also a major sales that is available and decide when the owner of your .com opportunity for misspellings source. The traffic could to use it as your business address decides to join the to occur. Conduct a search on result from those typing in name. It’s a good idea to get affiliate program of your the misspelled variations of your name in the address bar a trademark clearance opinion biggest competitor (or a porn your domain name to get a feel of the browser*, or it could from your attorney before site). The goal is to protect for the frequency of misspell- be from search engines beginning use. Don’t infringe your brand and secure the ings. The goal is to buy the There are some common on someone else’s mark. traffic intended for you. common misspellings so that sense, easy and inexpensive domain-name holders running steps you can take to protect automated “tasting” programs this asset: don’t get them first. — John Dozier

 NFIB Guide to eCommerce | February/March 2007 even give you a gift.” Every other month, that means a free burger. In December, “we buy gifts for all our family,” Olinto said. “It’s going to average about $4 per person Web Sites for the first 200 people who respond at each store, but that doesn’t really matter. They’re wrapped, they are personal; for me, it means a lot if someone gives me a for Service gift.” Besides, he pointed out, the business can afford to play Santa: the newsletter and its distribution carried no material cost. Businesses Four thousand b.good customers have signed up for the monthly newsletter. “The newsletter has nothing to do with An online presence can help you compete how delicious our hamburgers are, it’s with major franchises usually a narrative of what happened that month in the kitchen. People are reading it and responding. It’s an emotional con- By Rachel Coleman, Practical eCommerce staff writer nection,” he said. The replies that show up in his in-box, however, generate more than a warm-and-fuzzy feeling. They There’s nothing virtual of how “The Oliver” and “El Guapo” got mean b.good is in good shape. about hamburgers and fries, but that their names, along with photos of the win- “They only way [small businesses] can didn’t stop b.good restaurants in the ners. Customers can also sign up for e-mail compete and survive is to really be smart,” area from going online. updates and a popular, quirky monthly e- Olinto said. “The Web is the tool of the “I’m a real believer in the Web’s ability mail newsletter complete with video clips. little guy. It’s not like it used to be — you to generate returns for small businesses “We don’t want to eliminate humans don’t have to buy Super Bowl commercial with limited resources,” said co-owner from the order-taking process,” he said. time or full-page ads to reach a lot of people Jon Olinto. He and his childhood friend “What we want to do is facilitate a dia- anymore.” Anthony Ackil left business consulting logue. If you give us your e-mail and let us That kind of resourcefulness can work careers to launch the restaurant in 2003. talk to you — like real people talk — we’ll for any service-based business, said Pam Since then, b.good’s Web presence has allowed the company to capitalize on what it does best: serve a desirable alterna- tive to fast food to a loyal customer base. So far, b.good’s approach seems to be Our Web site is a very valuable asset right now. I’m in a a success. The partners will open a third market that is Web savvy, and customers are always looking store this year. for ways to check out a service businesses before making a call. The weapon that allows b.good to The Web site helps provide potential customers information contend with the burger giants? A Web- about our business, and it has information to facilitated, ongoing dialogue with the help customers make educated decisions about folks who willingly pay $5 to $7 for a anyone they would hire to do painting. We help freshly-ground, freshly-grilled burger, them know what questions to ask. We’ve added oven-crisped fries and healthy shakes testimonials to our site to give additional cred- that don’t contain artificial ingredients. ibility to our company. We have a photo gallery to b.good posts its menu and prices online showcase past and present projects. We’ve added a feature to at bgood.com, but Olinto doesn’t see the allow customers to request a quote from the Web site, and we site as a way to streamline operations. Its have recently added a Web-only coupon customers can use. We real value lies in the “Join Our Family” also plan to add audio and video clips in the future. Our Web page, which invites customers to par- site is clearly an important part of our marketing efforts. ticipate. b.good runs contests to name the new sandwiches it introduces — win- » Sal Ingiaimo, President ners receive a year’s worth of the newly web site salsqualitypainting.com christened burger. Links relate the stories sells Residential and Commercial Painting

www.NFIB.com  Stein, owner of Chicago-based Charlotte’s Web Market- ing, an online marketing consulting firm. Idea Starters For Service Businesses “There are these very disparate tools out there to help businesses,” she said, “There have got to be a bazillion peo- Whether your business is a salon, an auto repair shop or a ple trying to work on this, but no one has cracked the nut to coffeehouse, “there’s a lot that you could be doing if you only make it all work together. It’s an infrastructure issue.” knew what to do,” to build a Web component, said Charlotte’s Web Until a one-package solution arrives, Stein said, small ser- Consulting CEO Pam Stein. vice businesses have to make outreach a personal project. Keep it simple at the beginning. “How many businesses collect e-mail addresses from customers and use them?” she said. “Print your Web address “It doesn’t have to be huge or robust,” Stein said. “You need a on all of your marketing materials, your business cards, your decent enough Web presence for people to see it’s there. Keep it receipts. It’s really basic stuff if you just think about it.” basic, just get started.” You can always add more later. Not enough business owners share Olinto’s buoyant Everyone Tell where your business is located, and show how to enthusiasm for Web-generated customer-business conver- get there with a map. When are you open? List the hours, including sation, said Tim Hinkle, owner of Websolutionsbuilder. options for private consultations or appointments. As much as pos- com, the consulting company that built b.good’s site. sible, list prices or rates. Make it easy for customers to ask questions. “b.good’s approach is, ‘embrace the Internet,’” he said, Allow customers to easily contact you via telephone or e-mail. Ask “and it works because they understand who they are and for clients’ e-mail addresses, and use those addresses judiciously to what they want to accomplish.” market special items, events and offers. That awareness is the first step a service-based business must take. b.good’s philosophy boils down to something Dry cleaners Provide a secure log-in option for customers to like this: “We love burgers and fries, but we hate what fast check whether items are ready for pick-up. food has become,” Olinto said. “With mass-produced food, Restaurants Post a menu with prices. Display pictures of the the customer experience is totally passive. You walk in, pay food. Show good photos of the dining areas. Is it a formal setting? for a burger and leave without a trace. There’s no emotional Will jeans be appropriate? Structure your site to accept reserva- connection. What we try to do is really make customers a tions. Announce new items and special events. Send e-mails of part of the thing. We want people to feel like they’re part daily specials to return customers. of our business.” Hinkle said every business owner should create a “mis- Personal training and sports Video training offers kids and sion statement” in order to make the best use of the Web. parents more detailed instruction on various skills. Set up a Q&A The next step is to realize there are real reasons to feature, or answer questions directly. Link to accredited athletic invest in a consultant. organizations. Send out e-mail notices of new classes, training “If you’re going to get your car fixed, there are cer- sessions or organized sports league sign-up and start-up days. tain things you’re just not going to do yourself,” Hinkle Salon and fashion outlets Dialogue with customers about what pointed out. “Some businesses try to send their own e- they’d like to see more of. Conduct votes or rating exercises to see mails,” but they haven’t taken the time to learn how to what is the most popular item on the shelf. Focus on seasonal or format them for readability and results. special events with calendars, tips — “pretty prom hairstyles” or Everyone can’t afford to have a big ad agency come in “everything we have in our town’s college colors.” to help, Stein said, but it’s worthwhile to hand over $500 for a site designer to get things started. Most will work Daycare centers Websolutionsbuilder.com helped The Learning with the client until there’s a basic level of proficiency. Zone build clientele so much the daycare center now has a four-month “Pay someone to hold your hand,” she said. “If you waiting list. The site includes secure KinderCam video for parents to need to, have them come in and execute it on a consistent check in on their kids. Photo galleries, also secure, program announce- basis.” After a while, the business owner will acquire the ments and curriculum information and rates round out the site. Other skills to go it alone. items could include a kids’ art gallery, calendar of local and area family Or, as b.good has done, hire the consultant to periodi- and children’s events and links to activity and learning pages. cally tune up the site. Auto repair shops Send a monthly reminder about seasonal “My business partner and I do all the creative stuff, maintenance needs — “Time to put in antifreeze; change your and once we make the decision on what to do, we turn oil type.” Create a photo page for proud auto owners to display it over to Websolutions,” Olinto said. “They package it special or custom vehicles. Track owners by vehicle make and nicely, they post it online — they’re awesome.” model, then notify them of recalls and items to check. Provide The returns linger, Hinkle added. links to auto makers’ sites. “It’s not like a TV or print ad: It’s always there, it’s — Rachel Coleman always on and it’s a great investment to make.”

 NFIB Guide to eCommerce | February/March 2007 Selling Products Online User-friendly shopping carts* and predesigned templates have made What does a business need to launch an it significantly easier to sell products ecommerce business? online in recent years. This advent of new technology allows a merchant to have an online store established within By Mitch Bettis, Practical eCommerce contributing editor minutes. However, it’s important to understand that quickly opening a store on the Web ChannelAdvisor, an ecommerce consult- and not really worry about demand and doesn’t mean it will be easier to operate a ing firm. “It’s like when you ride a bicycle. merchandising that much,” Wingo said. successful online operation than to run a You have a lot going on: you are steering, “eBay brings the demand, you bring the brick-and-mortar business. you are pedaling and you are trying to bal- products, then you have to do the logistics What do I really need to sell prod- ance. Training wheels take the balance piece. Then, as you outgrow eBay you can ucts online? out of the equation, and you can focus on really expand beyond that and open your You can sell products online with- pedaling and steering. Then, when you are own Web site.” out spending money to buy a domain really good on those things, you take the Keep in mind that these public mar- name*, purchase a shopping cart or cre- training wheels off and you work on bal- ketplaces are very competitive environ- ating a Web site. Public marketplaces ance. The same is true for ecommerce.” ments, and there are differences in the like eBay, Amazon and Overstock allow Wingo notes that in ecommerce, a shoppers at each site. merchants to sell products from their merchant must first find out what he “A lot of people will actually increase sites. Experts say the public market- wants to sell and where to locate sources their prices for Amazon because the aver- places are typically safe environments for those products. Then he must focus age Amazon consumer is an early adapter,” for ecommerce rookies to sell products. on merchandising and logistics. Wingo said. “They are not very price-sensi- “I think about eBay as ecommerce “What eBay lets you do is really focus tive. They are willing to pay near full price, training wheels,” said Scot Wingo, CEO of on the product sourcing and logistics or even sometimes above full price, if it is something that is a relatively hot product.” Wingo said the average eBay user is We operate a brick-and-mortar at the opposite end of the spectrum. store as a well as a warehouse to fulfill our “The eBay buyer is your cheapest kind ecommerce Web site orders. We have and the most deal-oriented buyer out experimented with other sales channels, there,” he said. “Consequently, once people such as eBay, but we find that our stand- have many online channels, they typically alone site is still the best channel for us look at eBay as one of the last channels they to reach our current and future growth will run a product through. Or they may expectations. Approximately 70 percent of source end-of-life, severely-discounted our gross revenues can be attributed to our products on eBay. The eBay consumer is ecommerce Web site. really looking for 30-50 percent off retail.” Listing products to sell on these sites is easy and relatively inexpensive. Once » JIM LAFRAMBOISE, business owners get a feel for online PRESIDENT AND CHIEF OPERATING OFFICER selling, they might launch their own web site Bosstoolsupply.com Web site in addition to selling at one of sells Tools for home and industry use the marketplaces.

www.NFIB.com  What do I need to create my own all-in-one solution; 2) Create your own settling on a hosting company. A host is a Web site? Web site; or 3) Hire a Web site developer. company that rents space on Web servers Creating a Web site to sell products to house other people’s Web sites. Hosts doesn’t have to be a complicated or All-in-one solutions typically offer three types of services: intimidating process. Creating a Web In recent years, all-in-one solutions shared, dedicated or virtual-dedicated. presence can be done with or without (often referred to as “hosted solutions”) Each of these has pros and cons (the ser- hiring a Web developer. have made it easy for ecommerce nov- vices are explained in more detail on page There are three options: 1) Choose an ices to quickly launch a Web site with- 18.). Many hosts also provide the individual out detailed knowledge of ecommerce pieces you might need to assemble a basic terms to know or the aid of a Web site developer. An Web site including shopping carts*, all-in-one solution charges a monthly design templates, etc. Domain name A series of words fee for everything you’ll need to oper- Hosting companies oftentimes pro- separated by dots (e.g. NFIB. ate a site — you don’t have to assemble vide all those pieces in a single package com) identifying an Internet Protocol and integrate all the pieces to make the for a monthly fee. Alternatively, you can address. See story on page 3 for more online store work. purchase them separately and integrate information. “The whole power of hosted software them yourself. solutions is that you don’t have to be an The benefit of creating your own HTML A “language” used to create IT [information technology] expert,” store is that you might have more flex- documents on the World Wide Web. said Julian Green, director of all-in-one ibility with design than what is available Merchant account An account solution ProStores. “You just basically at a hosted solution, and you might be provided by a financial institution allow- have to be able to use a browser. You able to integrate a more diverse group ing your Web site to accept payment basically outsource the IT expertise of payment options. In addition, if your transactions for products/services in to the hosted solution provider. At the business requires integration of unique real time, via credit cards, e-checks simplest level, if you can do your e-mail software, that might be easier if you set and debit cards. or browse the Internet, you can do a up your own site. store online. It’s designed to be easy.” Novices can locate various tem- Allows the All-in-one solutions come equipped plates available for purchase on the secure transfer of credit card funds with a shopping cart, payment gate- Internet that allow a person to create from users on your Web site to your way*, marketing functions and various a well-designed site without knowing merchant account. design templates. They also include the how to create HTML* pages. Sites like Shopping carts A shopping cart off-site computer space for housing all Templatemonster.com, Perfectory.com is the software that keeps track of all the Web pages you will create for your and others allow merchants to purchase the items an online buyer wants to pur- site — commonly called a “server” or a predesigned pages. chase, allowing the shopper to pay for “host.” As merchants’ Web savviness Beyond that, the most critical part is the whole order at once. The shopping grows, all-in-one solutions may allow putting together the elements needed cart also allows a retailer to display his merchants to add more complicated and to display products and complete online products, and it helps facilitate credit distinctive features. transactions. card payments for products purchased One disadvantage of using an all-in-one An important element to consider is by customers at a merchant’s Web site. solution is that a merchant may pay fees the shopping cart. There are hundreds to the provider based on sales; the more of shopping carts, ranging in cost from SSL Certificate An SSL certificate sales, the more fees. Another disadvan- free to several thousand dollars. gives a Web site the ability to communi- tage is that when moving from a hosted You’ll need a merchant account* to cate securely with its online customers. solution to a more customized Web prod- process credit cards (you may be able to use They are used to identify the merchant uct, the merchant will essentially throw the one you use with your brick-and-mortar and encrypt the credit card information away the investment in time and money business), a payment gateway* and an SSL and other sensitive data. he’s put forward in creating the all-in-one certificate* to encrypt credit card informa- URL The standard way to give the site because it isn’t portable. tion. Those pieces integrate fairly easily, address of any resource on the Internet but everything must be done correctly to that is part of the World Wide Web Create your own Web site be able to process an online payment. (WWW); http://www.nfib.org is an Even if a merchant has little computer example URL. See story on page 3 for programming knowledge, he can build Hire a Web site developer more details. his own store. It will just be up to the mer- If you are interested in putting all the chant to assemble the necessary pieces. pieces together, consider finding a Web One of the first pieces to explore is site developer who (for a fee) will assemble

 NFIB Guide to eCommerce | February/March 2007 your site. These professionals will work “The idea is to help you with all of your In addition to Stone Edge’s Order Man- with you on a custom-designed option day-to-day operations,” said Barney Stone, ager, there are various order-management and integrate all the pieces needed to com- president of the company that produces systems a business owner could purchase plete the payment process. It’s important Stone Edge Order Manager. “It typically to integrate with his current shopping to make sure the developer you hire has starts with importing orders from your cart including Mail Order Manager from experience building ecommerce sites and shopping cart or whatever other sales Dydacomp, Shipworks and others. has a familiarity with many of the 400+ channels you have, building the customer Some shopping carts come with an shopping carts in the marketplace. Don’t list that you can use for marketing, updat- order management component as part of hire the kid next door just because he can ing your inventory so that it is checking their all-in-one package. However, keep build a Web site (many people can build for out-of-stock items and subtracting in mind that if you get involved with a cart Web sites); you want someone who can what has been sold from your quantity on that can’t scale to meet your future needs, help you meet your online business’ goals. hand, sending out e-mail confirmations you’ll have to find a new order manage- For more information on hiring a to customers, sending drop-ship orders to ment system if you switch carts. developer, see story on page 12. vendors and sending other orders to ful- “The order management and the fulfill- fillment centers if you do not do your own ment pieces are really key to consider in Integrating with your brick-and- fulfillment.” your ecommerce operations to be success- mortar operation According to Stone, costs for an order- ful in today’s Internet market,” said Mimi Order management software can management system can range from Peiris, vice president of product manage- integrate your existing brick-and-mor- around $1,000 to $15,000, or more. ment for all-in-one solution NetSuite. tar stores with your Web site operations. “If you buy $1,500 worth of software and “Some ecommerce solutions are getting You’ll especially want to make certain it saves you even a minimum-wage type beyond just a shopping cart, providing a accounting and inventory functions of person, you are talking 1,000 percent complete ecommerce solution. For a small integrate. Most order management soft- return on your investment,” said Stone. “It company, it is much more feasible to get ware can also help automate many tasks does not take saving more than an hour a an all-in-one package because they do not associated with your online store. week to justify a $1,500 investment.” have a lot of IT resources.”

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www.NFIB.com  to medium-sized businesses. Specifically, we asked him to guide the business owner through the process of buying a shopping cart for an ecommerce Web site.

1. Talk with other ecommerce Shopping Cart business owners. As with any other major business deci- sion, it behooves the business owner to Options do some homework. Given that ecom- merce and, specifically shopping-cart technologies, have been around for sev- eral years now, a wealth of knowledge is available online and in real life from entrepreneurial colleagues with similar 10 Steps to Making the Right Choice experiences. “I’d definitely go out and talk to other people who have done ecommerce Practical eCommerce staff writer By Ryan Welton, before,” Greenburg said.

2. Spend significant time browsing Much like brick-and- time of purchase — it’s a done deal. ecommerce Web sites. mortar retailers need to make well- A hosted solution requires less tech- informed decisions regarding point-of- nical knowledge to operate, but you pay Greenburg recommends document- sale equipment, ecommerce business a monthly fee for that convenience. ing business processes and goals before owners have to do their homework when you conduct shopping-cart research. The it comes time to select a shopping cart Where do you start? business owner should know what it is he for an online business. or she plans to sell online, how payments A shopping cart is the software that We talked with Eran Greenburg, an will be collected and how products will be keeps track of all the items an online buyer NFIB member who works in the business displayed. Then, when you research shop- wants to purchase, allowing the shopper to development department for Verango, Inc., ping carts, you can match what’s available pay for the whole order at once. The shop- a Provo, Utah,-based company that created with your needs and find the best fit. ping cart also allows retailers to display a hosted ecommerce cart solution for small- Visit Web sites that sell products, collect their products, and it helps facilitate credit looking for a vendor? payments and deliver goods in the manner card payments for products purchased by you’ve outlined for your business. Contact customers at a merchant’s Web site. If you are looking for a shopping business owners to discuss their opinions There are two choices to consider cart vendor, here are some options. on the shopping cart they selected, with an with carts: a hosted (all-in-one) solution Shopping-Cart-Reviews.com provides emphasis on learning from any mistakes or a licensed solution. links to shopping cart companies, they might have made along the way. The simplest way to think of a hosted as well as reviews and articles on shopping cart solution is to envision it as various carts. Additionally, Authorize. 3. Decide between a hosted and an application someone else helps you set Net, a leading credit card gateway licensed solution. up and customize. The cart resides on their company, has an extensive list of server. Thus, a hosted shopping cart is one Authorize.Net-approved shopping Dan Douglass, a 20-year veteran of that someone else hosts and manages. cart companies. Click on “Find the information technology industry A licensed solution is a shopping cart a Shopping Cart” at Authorize. and the technical director for InSite that you install and manage by yourself. net. PayPal, the private payment Interactive, one of Dallas’ premiere Buying a licensed solution can require company, lists PayPal-approved interactive marketing agencies, leads the small-business owner to have some shopping cart companies. Go to a team of experts who help businesses technical skill to install and update. Alter- Paypal.com, click “accept credit traverse bumpy shopping-cart waters. natively, you can hire a person who has cards online” and then click He explains the advantages of hosted, that skill. However, the main cost associ- “compatible shopping carts.” licensed and alternative shopping-cart ated with a licensed solution is paid at the solutions:

10 NFIB Guide to eCommerce | February/March 2007 Advantages to a hosted solution include:

Tech support. You’ll typically have access to experts who can help you with technical issues.

Data backups. Somebody has to make sure transactional data isn’t lost.

Set-up assistance. Unless you’re technical, this advantage is worth its weight in gold.

Lower costs. Some shopping cart hosts offer a licensing structure in which you share the cost with other businesses who utilize the same server space as you.

Advantages to a licensed solution include:

Reporting. Many out-of-the-box shopping cart products offer multiple ways to seamlessly export data into your sales software.

Flexibility. Software selections are often platform- and technology- independent. savvy consumers are leveraging “escrow Short-term expenditure. Expect systems” to make online purchases. to pay about $250-$1,000 for the Some banks allow consumers to obtain shopping-cart software itself. credit card numbers for the sole purpose of making online purchases. The consumer There are free, licensed options for assigns an amount of money available to shopping carts. However, a general rule a credit card number for the purpose of a of thumb is the less you pay for a shop- single purchase, and that money can be ping cart, the more technical expertise drawn from any account, invisible to the it will require to install, maintain, cus- business. tomize and update. PayPal’s distinct advantage as a shop- What about alternative pay or pseudo ping-cart system lies in making the pay- carts? ment processing aspect of the online Solutions such as the shopping cart business easy and inexpensive. offered by PayPal are technically hosted. “It’s great for entry-level merchants,” However, they’re a bit non-traditional in Greenburg said. terms of how transactions are handled. Experts expect shopping carts that offer 4. Take the shopping cart vendor’s consumers a multitude of payment options support team for a test drive. — more than traditional debit and credit cards — will be the wave of at least the near Even if you plan to hire a Web developer future. For example, Douglass noted many to assist with installing and maintaining

www.NFIB.com 11 your shopping cart, you should know what to expect from the support team. “Call the company up and see how We launched our site on an open source plat- knowledgeable their support is,” Green- form in 1999. We went to Yahoo! just about burg said. 2000-2001 because it was a lot easier interface for us to use, and we did not start off as ecom- 5. Understand the solution’s merce gurus. We did not know all the little shipping capabilities. tricks and techniques. We did not have a staff. We were operating on a very tight budget. Greenburg says most shopping carts only We realized that by going to Yahoo!, we could work with three to five shipping providers. launch a site that looks very professional with It is vital to know which providers each little to no knowledge about ecommerce Web cart works with so you can match those sites — how to build them and how to manage with anticipated shipping costs and the them. We have outgrown the Yahoo! platform and are just preferences of your users. If most of your about to launch a new site on a different platform. customer base will be well served by UPS, and your shopping cart is great at handling » KEVIN WATTS, DIRECTOR OF eCOMMERCE UPS-shipped transactions, then you could web site Organize.com have a good match for your business. sells Residential and Commercial Organizational Products However, shipping providers aren’t the only concern when valuing a shop- ness owners should inquire about shop- 9. Figure out how much time you’re ping cart’s shipping capabilities. ping cart features that are equipped with willing to spend. “Printing shipping labels is another functionality to help market your busi- bag of worms,” Greenburg said. ness. For example, can your cart handle If you think that the time you’ll spend Ask the shopping cart vendor for coupon creation and transactions using with your shopping cart is limited to its details about their shipping label print third-party coupons? Can it handle a pre- purchase, installation and product setup, capabilities. ferred customer or rewards program? think again. As your business changes, “If you’re not thinking about market- you’ll probably make tweaks and adjust- 6. Study the solution’s flexibility ing, you’re headed down the wrong road,” ments to your shopping cart. As technol- and scalability. he said. ogy dictates, you’ll likely make tweaks and adjustments to your shopping cart. A rule of thumb when doing anything 8. Know whether it can help with If you decide to buy a licensed, out-of- ecommerce-related is not to plan for what search engine optimization. the-box solution, consider hiring a Web your business can handle today. Plan for developer who specializes in shopping what it can handle a couple of years from One subset of online business market- cart set-up and maintenance — even if now. Ask shopping cart vendors how their ing that is becoming more prevalent in the it’s just on an as-needed basis. product expands with your business. shopping cart world is how solutions deal If you decide to buy a hosted solution, with search engine optimization — how make sure the vendor’s support team is How many products can it handle? well your site’s information and products knowledgeable, friendly and efficient. The can be found in major search engines, stronger they are, the less time you’ll have How many users can it support at one such as Google. to spend managing your shopping cart. time? Because shopping carts are dynamic, not only in terms of product additions 10. Calculate how much money Will you have access to cart updates and subtractions but also in terms of how you’re willing to spend. over time? they display pages on Web sites, getting your products indexed by Google, for Greenburg says that hosted solutions example, is a vital challenge. are generally cheaper to set up, maintain 7. Discover the solution’s marketing Greenburg acknowledges that most and support. However, your cost is ongo- capabilities. experts say today’s shopping carts, in ing, month-to-month or year-to-year. general, don’t address search engine While licensed products are more likely to “A lot of shopping carts are just tech- optimization well. be purchased with a one-time fee, the busi- nical applications,” Greenburg said. “The’re not really optimized to get ness owner will need to figure in time and Regardless of whether your solution is people to visit,” he said. support costs as part of a total cost-of-own- hosted or licensed, Greenburg says busi- ership evaluation of any shopping cart.

12 NFIB Guide to eCommerce | February/March 2007 Google announces a special offer for entrepreneurs: Try AdWords. On us.

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© Copyright 2007. All rights reserved. Google and the Google logo are registered trademarks of Google Inc.

www.NFIB.com 13 Credit Card Fraud Is a Manageable Risk

Internet-based businesses. “Online mer- chants can be the victims of two types of credit card fraud,” Schwartz said. “One is transaction fraud, whereby a merchant Two types of fraud for online merchants will unknowingly accept a stolen credit card number. The second is security fraud, which occurs when hackers steal the card By Brian Getting, Practical eCommerce online director numbers of the merchant’s customers.” Schwartz continues, “Both risks are manageable, however, so long as the Order From Horder is card fees. Wells would loose the value of merchant recognizes them and takes an office-supply retailer in Charlot- the merchandise and still have to pay the appropriate precautions.” tesville, Va. Carole and Fred Wells credit card fees. In short, Wells would be For transaction fraud, many of these have owned the business since 1993 and the victim of credit card fraud. precautions are common sense solutions. they have 10 employees. The Wells sell David Schwartz is director of marketing For example, if an online order is larger their office products from an attractive, at Authorize.Net, a credit card payment than normal, the merchant may want to red-brick building on a sunny corner in gateway* serving more than 158,000 call or contact the customer to confirm. downtown Charlottesville. They also sell products on their Web site. “I was nervous at first, selling our stuff online,” says Fred Wells. “How do you know if the guy on the other end is real? We started getting a lot of sales, but we also We know our local customers are real started getting complaints from people saying because they walk through our doors, but there were false charges on their credit cards. we couldn’t see the online customers.” Apparently, thieves had acquired stolen credit Wells’ online customers pay with card numbers, and they could buy merchan- credit cards. That is, they select their dise at our site because we hadn’t activated the office supply products on Wells’ Web card code verification (CCV) security feature site, add those products to Wells’ online in our shopping cart. The CCV feature asks shopping cart*, supply their name and for the three- or four-digit code on the actual address and then pay for the products card and only the card holder would have with, typically, a credit card number. that. The thieves weren’t buying large-ticket items, but they But, what if an online customer was could have. Instead, they were buying multiple $100 items actually a thief who stole a credit card to not attract undue attention. In the end, about $15,000 in and then placed an order on Wells’ Web merchandise was stolen. Once we figured it out and activated site using that stolen number? It’s possible the CCV feature, we haven’t had any problems. In addition that Wells could ship the products to the to using CCV protection, we now make a phone call to each thief and never get paid for them because person who places an order to verify the purchase, and we use the rightful owner of the stolen credit other resources to crosscheck the mailing address. card would subsequently refuse to pay » PATRICK COUGHLIN, OWNER the credit card company. The credit card web site americandiamondimporters.com company would then collect the money sells Jewelry and gifts back from Wells, net of the original credit

14 NFIB Guide to eCommerce | February/March 2007 Likewise, if an online customer requests products to be shipped to an address different from the billing address on the credit card statement (the billing Protect Your Customers’ addresses are automatically tracked by the merchant’s credit card payment gate- Credit Card Data way company), the merchant may want to confirm with the customer. Interna- tional orders? Confirm with the customer. Online merchants must guard against two Beyond the common-sense precautions, the credit card payment industry types of credit card fraud — transaction is full of built-in tools available to merchants. There’s the automatic flagging fraud and security fraud. Security fraud of orders that have differing shipping and billing addresses. There’s the use occurs when thieves hack into a merchant’s of the card code verification number (CCV) which is the three- or four-digit computer and steal customers’ credit card code appearing on all credit cards. Merchants can require customers to sub- numbers and other data. To protect against mit this code with all orders, and the merchant’s payment gateway will reject security fraud, merchants can consider an order with a CCV number that doesn’t match the card number itself. implementing the following precautions Merchants can track (and prevent) rapid transactions from a single source. offered by Authorize.Net, the credit card Merchants can block transactions from specific computers on the Inter- gateway company. net. Merchants can set single-transaction limitations and daily-transaction Install a Firewall A firewall is a hardware limitations. All of these tools, and more, are typically provided by a mer- or software solution monitoring the activity of chant’s credit card gateway company. external connections (primarily the Internet) But many merchants go beyond the common-sense precautions and the built- to an internal network of servers. Firewalls in tools. Take, for example, Fred Wells. Wells, the office-supply retailer, inte- help to eliminate unauthorized or unwanted grates specialized software, called FraudChaser, into his online shopping cart external activity and safeguard your network that automatically telephones every customer who places an order. FraudChaser and connections from outside threats. is sold by Chicago-based Authen- terms to know tify, Inc., and it is tailored for small Store All Sensitive or Confidential businesses. With FraudChaser, a Information Separate from Web servers. Shopping cart A shopping cart customer who places an order must For maximum information security, you is the software that keeps track of all supply a valid phone number, and should never store sensitive customer the items an online buyer wants to pur- the software calls the customer, information, such as credit card numbers. If chase, allowing the shopper to pay for who can then acknowledge the for some reason it is necessary to store this the whole order at once. The shopping order on his phone without the data, do so in a secure, encrypted database cart also allows a retailer to display his involvement of the merchant’s on a server that is not connected to the products, and it helps facilitate credit staff. It’s a simple process, and it Internet. If sensitive information is stored in card payments for products purchased costs the merchant less than a dol- hard copy, thoroughly shred and dispose of by customers at a merchant’s Web site. lar per transaction. In Wells’ case, the information on a regular basis. it has eliminated fraudulent trans- Payment Gateway Allows the Use Anti-Virus Software and Update actions. secure transfer of credit card funds It Often Anti-virus software is another There are other, similar tel- from users on your Web site to your important way to protect your network and ephonic verification systems merchant account. computer systems from outside vulnerabili- available for smaller Web-based ties. This software should be updated on a merchants. One of these is Los regular basis. Angeles-based Telesign, whose chief operating officer is Darren Berkovitz. Berkovitz explains the logic of telephonic confirmation to protect merchants Regularly Download and Install Security against credit card fraud, “The phone takes the verification out of the Internet Updates Software performance and realm. Most thieves will not leave a phone number because the number is trace- security can be optimized by installing all able. Our system will even tell a merchant what type of phone connection the service and security updates. If you ever customer has. This is important. A landline is most secure and otherwise takes need to reinstall your software, remember to the most effort to set up. But phone numbers that come from Skype [a free, reinstall all updates. Internet-based phone service] or prepaid mobile phones, for example, can be Avoid File Sharing Share access to more risky because they are easy to set-up and not so identifiable.” network drives and individual computers only Berkovitz believes merchants can successfully manage the risk of credit with needed, trustworthy users. Especially card fraud. “You have to embrace the future,” Berkovitz said. “There are avoid sharing access to files that store always risks to merchants, and credit card fraud is one of them. But there are passwords and other confidential or sensitive many down-to-earth solutions to protect against it. You never hear about information. the millions of successful online transactions. It’s only the few fraudulent ones that you hear about.”

www.NFIB.com 15 Is It Time To Hire A Web Site Developer? First and foremost, says recruiter Elo- Four steps to pick the right candidate ise Priest, decide how in-depth the Web site will be. Rich Baker, Aquent’s marketing IT By Ryan Welton, Practical eCommerce staff writer recruiting manager, says business own- ers need to consider the following as they make that assessment: Web sites don’t just How complex will my online business be? build themselves. The conundrum for the Is it merely a Web site to promote my Will information need to be stored in a small business owner is that there are a company, serving as a marketing append- database? If your business offers prod- host of choices as you establish an online age to my brick-and-mortar business? Or, ucts and your Web site will be a means presence. The decisions are important: will my Web site need to have an online to sell and distribute these products, the they’ll determine the online business store or be integrated with third-party answer is almost certainly “yes.” activity that comes with the new sales tools such as auctions or blogs?* channel and, of course, the additional How many pages will comprise your profit from the online endeavor. Do I have the technical capability to Web site? Choices abound. A few of the critical do any of this? early questions a business owner needs What kind of functionality do you to settle include: For most businesses, the answer to intend to feature on your Web site? “What kind of Web site do I want for the final point trumps the preceding In addition to an ecommerce store, my business?” questions. a business could offer features like “Do I need outside help building my e-mail newsletter sign-ups, product site?” Step 2: Do your homework. demos, blogs, calendars, product “If I need help, how do I go about photo galleries, etc. selecting a Web site developer?” Small companies and larger corpo- We’ve provided four steps to help you rations alike frequently look for guid- Priest suggests that, once Baker’s ques- through the process. ance from staffing firms like Aquent, a tions are answered, the businessperson do company that matches proven, creative some Web surfing. Check out your com- Step 1: Before taking the first step Web talent with businesses needing petitors’ Web sites or other ecommerce toward creating a Web site, ask help. Two of the company’s top recruit- sites that feature a design or functionality yourself three questions: ers offered pointers to help independent you like. Don’t hesitate to contact people businesses choose a Web developer. at the company to ask questions about Does my Web site need to have a their experiences. one-of-a-kind design, or would a neat, looking for a vendor? At some point, however, you’ll have clean, pre-made template work just There a many ways to locate a Web to decide whether you’re up to creating as well? developer. Start by asking other this Web site by yourself. businesses for referrals. Hosting “If the business has somebody on its Both Google and Microsoft, for companies and Internet service team who is Web savvy, the more likely example, sell pre-made Web designs for providers may have referrals for they are to do it themselves,” Baker said. your company to use. Some technical you, too. There are a couple of Web But if you don’t have a technophile knowledge is required in order to set up sites, Guru.com and Getafreelancer. within your reach, and if your site will the pages, to add content in a way that com, that link freelance profession- be more complex than a couple pages of meets your aesthetic needs and to main- als, such as Web developers, with content, then hiring a Web developer is tain the site on a regular basis. businesses and consumers. probably in your future.

16 NFIB Guide to eCommerce | February/March 2007 terms to know

The first Web site I created myself. As I Blogs A blog is just an easy-to-use learned more about the Web, I knew I had to Web-based content management system get some help and make the site better. I ended (CMS). It is software that allows people up at Finestshops.com. The Web site we are with little or no technical background developing now will show up much better in to update and maintain content. The the search engines, and it will be much better activity of updating a blog is known as than what I could do on my own. Be careful “blogging;” someone who keeps a blog is who you get to develop your Web site. You can a “blogger.” Entries written to the blog, pay anywhere from a few hundred dollars to called posts, are arranged in reverse tens of thousands of dollars. chronological order with the most recent additions featured at the top of the page. » JEFF DAHLBERG, OWNER Blog readers typically have the ability to web site Cheapseeds.com comment on what you have written and sells Flower seeds by the packet have those comments appear on the site.

Host A company that uses a Web Priest recommends setting a bud- obvious hiring step, however, the best server to provide storage space for get upfront for the entire project so predictor of a developer’s success for many Web sites. you’ll know how much you can allot your business is past success. for a developer’s time. Consider costs Shopping cart A shopping cart for hosting*, SSL certificates*, hosted Step 4: Learn from the mistakes of is the software that keeps track of all or licensed shopping cart solutions*, other businesses. the items an online buyer wants to pur- blogs* and photo royalties. chase, allowing the shopper to pay for Because Aquent specializes in match- the whole order at once. The shopping Step 3: Begin the search for talent. ing Web professionals with businesses, cart also allows a retailer to display his they have heard some horror stories. products, and it helps facilitate credit You can look locally for Web devel- For example, Baker says, opting to card payments for products purchased opers, or you can post a job description hire the lowest project bidder merely by customers at a merchant’s Web site. at an online resource like Guru.com because he or she is the least expensive SSL Certificates SSL certificates or Getafreelancer.com for regional or is possibly the most serious selection give a Web site the ability to communi- national candidates. faux pas possible. cate securely with its online customers. Whether you’re looking for a tempo- “You really get what you pay for,” he It is used to identify the merchant using rary freelance developer or a full-time said. it and encrypt the credit card informa- resource person to join your staff, don’t Presuming you’ve budgeted for a devel- tion and other sensitive data. trust your online business to the words on oper, consider these rules-of-thumb: a candidate’s resume. Baker says to ask for specific URLs (Web site addresses) from Hire somebody who can be physically Establish project milestones and each prospective developer. at your place of business at least deadlines with reasonable bonuses for Business owners “definitely have to some of the time, particularly if you’re compliance. One of the common risks in check the work themselves,” Baker said. not familiar with Web development hiring even the most talented developer A basic checklist of tasks for each processes. is that he or she doesn’t have the time candidate includes: to dedicate to your work. Choosing a “Off-site (partnerships) can work if developer with demonstrated project Visit the developer’s sites. Do they you have several meetings,” Priest said. management experience can help to look good? Do they load properly alleviate that concern. in multiple browser types? Do they Avoid offshore talent. In addition to function in a way you’d expect your the consideration in No. 1, communi- Choosing a Web developer to build Web site to function? cation and project management risks your ecommerce presence is equivalent are higher when the developer is in to taking on a partner. If you make sure Ask if their code is compliant with another country. the bullet points on a candidate’s resume basic Web standards. actually convert to real-world ability, “I’d try to stay away from any kind of you’ve taken a key step in making your Check references. It seems like an offshore work,” Baker said. hiring decision a smart one.

www.NFIB.com 17 less bandwidth and may be risking your site’s uptime.* If you are having very few sales on your site, if your site has relatively little traffic or if you’re a service business, Hosting a shared server will probably suffice. If online sales are critical to you and downtime is not an option, your best option will be either a dedicated or vir- Company tual-dedicated server. A dedicated server is akin to a single- family home — it’s more expensive than Considerations living with college roommates, but you have the space all to yourself. Dedicated servers provide a business with a larger amount of uptime, greater server access, Price isn’t always most important the guaranteed ability to use custom applications, greater bandwidth and owners of dedicated servers often receive Practical eCommerce contributing editor By Mitch Bettis, superior technical support. If your company has multiple ecom- merce businesses on several shared It may seem like a carts and other features, select a company hosting sites, it may be cheaper in the daunting task to locate the right domain- based on those criteria.” long run to have all those sites on a sin- hosting firm for your business, as there There are several key items to con- gle dedicated server where you have the seems to be an endless sea of options. sider in a Web host to ensure you select entire “house” to yourself. Wading through the many choices in the the company that best fits your needs. Before leaping to a dedicated environ- Web hosting market can be frustrating ment, an ecommerce owner should con- and confusing. Shared vs. Dedicated vs. sider if a virtual-dedicated server would Rather than looking for a hosting Virtual-dedicated meet his/her needs. company that only offers the lowest Unlike sharing space with college price, Remik Kolodziej, co-owner and When selecting a domain hosting friends or owning a single-family home, a founder of Dotcomhost.com, a Web site company for your Web site, one of the virtual-dedicated server could be likened hosting company, said business owners earliest questions you’ll need to resolve to a hotel where a person has his own should look for a host that best matches is whether you want a shared, dedicated defined space, own bathroom, etc., within their needs before looking at price. or virtual-dedicated hosting plan. The the confines of a larger facility that has “Not all hosting companies are created main difference between the three is other rooms with their own finite space. equal,” Kolodziej said. “When people shop how many other businesses access the A virtual-dedicated server is likely to around for something, a house or a car, they same the Web server.* come with an easy-to-use control panel can easily see a difference between avail- Consider shared hosting similar to liv- and other management functions of a able choices. But when it comes to hosting, ing in a house with several roommates shared server, making it a viable option people often assume all hosting companies during your college days. The rent is less for business owners needing more stability are the same. Ninety percent of people because you’re sharing the cost with others, and security than a shared server can offer. shop for price first, then look at features. It but you don’t have unlimited room to your- If you’ve outgrown a shared plan and aren’t should be done the opposite way.” self. You’re often impacted by other people ready to jump into the deep waters with a Kolodziej said Web site owners should in the house, and when there is trouble in dedicated server, a virtual-dedicated server have a clear understanding of what ser- one of the rooms, you’re often impacted plan may be a great intermediate step. vices and support they need, and then because of your proximity. If each of the So what is the difference between a look for a host that can fill those needs. roommates is relatively quiet and coopera- shared server and a virtual-dedicated “Start with the staff of the hosting com- tive, everything can work smoothly. server? After all, they both are sharing a pany and choose the company that focuses A shared hosting environment is often portion of space with other sites. on the needs you have with your company,” similar as several Web sites share a single With a shared server, the domain Kolodziej said. “If your company has spe- server. If you are simply looking at cost, hosting company is often making a cal- cific needs, requires assistance with certain a shared environment is the way to go — culated guess that you and other sites applications or desires particular shopping but you also get less data storage space and with which you are sharing a server will

18 NFIB Guide to eCommerce | February/March 2007 never use all the disk space and band- that when they move to the online world width you purchased. If it turns out your and want to sell online, they assume that site grows to use all the space you’ve Internet equals free and want the same in a We’ll purchased and others on your server do hosting company. If you’re opening a brick- Create the same, your server can become “over- and-mortar store, you’re going to pay rent. booked” and difficulties will ensue. Spending $500 on dedicated server is still Your With a virtual-dedicated server, you a lot less expensive than rent, and you have are “sharing” space with other sites. How- the stability and piece of mind needed to Website ever, each person on the server has pur- run your business.” chased an equal amount of space and they Most hosting companies provide an for $199. can’t extend beyond their area and impact opportunity for a business to graduate And We’ll your space. You are guaranteed a defined from a shared to a dedicated environ- amount of space and system resources ment if its business needs change, but Host It for regardless of what happens with your be sure to inquire about the ability to “neighbors,” resulting in greater stability upgrade when you’re doing your research $6.95 per with your site and an enhanced shopping into hosting companies. experience for your customers. You might subscribe to a shared month. Keep in mind, however, that saving a server for about $5-20 per month (that few dollars per month on a shared server may or may not include setup fees) for might seem attractive, but it’s more about 2,000 MB of Web disk space important your customers can have a and 40 GB of bandwidth. A dedicated quality experience at your site. server might cost $100-1,000 per “Trying to run a $1 million company month, but you get exponentially more on a $20 hosting plan may work,” said Web disk space and bandwidth plus dotCOM host’s Kolodziej. “But it may not greater stability and service. A virtual- necessarily provide the best experience dedicated server will cost somewhere for your customers. A lot of people forget in between.

When we started out, we used a shared server, and that N\Ëi\FCD%e\k#Xe[n\cfm\jdXcc worked fine initially because our traffic was low, sales were low Ylj`e\jj\j%8jfe\f]k_\cXi^\jk# and product catalog was low. After a while it became obvious dfjkjkXYc\_fjk`e^ZfdgXe`\j# we needed to have our own server just because of the load. Not flijdXccYlj`e\jjZc`\ekjiXe^\ ]ifdgcldY\ijkfgif^iXdd\ij# only from the storage capacity standpoint, but also just from the i\jkXliXk\lijkfi\kX`c\ij%=fi bandwidth that we use and the amount of traffic. Folks who (00n\ËccZi\Xk\k_\g\i]\Zkn\Y$ come to our Web site are able to download sound samples of j`k\]fipflijdXccYlj`e\jj%8e[ some of the material that we sell, and some of them are pretty k_\en\Ëcc_fjk`k]fialjk-%0,g\i dfek_%K_`j`eZcl[\j]i\\[fdX`e large. That takes a considerable amount of bandwidth. Once i\^`jkiXk`fe#(,']i\\\dX`cXZ$ we started getting complaints from ZflekjXe[Xn\jfd\)+&.k\Z_ customers that they could not get jlggfik% the pages on our Web site and it was sluggish, that is when we realized Want to learn more? ;fnecfX[ÈN\Yj`k\j that “Okay, we’ve got to make a ]fiJdXcc9lj`e\jj\jÉ# decision here.” It became obvious fli]i\\^l`[\#Xk that we would have to go to our FCD%e\k&JdXcc9lj`e\jj% own server, which we did a couple of years ago. We now have our own dedicated server.

» ROB DUBOFF, CO-OWNER web site Ejazzlines.com 800-741-6813 sells Jazz products including CDs, DVDs, books and scores www.OLM.net

www.NFIB.com 19 Technical Support 40-50KB — that’s small. Unless your site “eavesdropping.” An additional “extra” boasts a robust database or it’s a site with to research is whether your domain host For someone with intermediate Web many images, it’s unlikely you’ll need a provides or can accommodate any type of skills (or less), it’s critical to have quality large amount of space for your site. Find- database, message board or other third- technical support functions at any Web myhosting.com also provides a handy “disk party software your site might need. host. You’re going to want a resource that space calculator” a person can use to esti- You must do your homework. If you is available to assist you — preferably 24 mate the amount of space needed for a site. use specific types of software on your site, hours a day, seven days a week. That may Many sites don’t even use 5MB of space. visit online communities specializing in seem unimaginable to you at first, but you those software packages to see what your can count on something going wrong at E-mail Options peers and competitors are saying about 11:41 p.m. If your Web site is out of busi- their hosting companies. ness, you’re out of business. If you have a How many e-mail accounts do you In addition, be aware of server resell- Web site that’s not essential to helping you want for your operation? 10? 100? Dif- ers. There are many businesses marketing earn money to pay employees or put food ferent hosting plans will accommodate themselves as hosting companies that don’t on the table, perhaps you can justify spend- different quantities of e-mail accounts. own servers. They are simply sales organi- ing fewer dollars on a hosting service that Don’t assume there will be an unlimited zations. Using a reseller doesn’t necessarily provides less support. Otherwise, technical number available to you included in the mean you’ll end up in dire straits, but you support should be high on the priority list. cost of your package. Most domain hosts may be dealing with a business that can’t are happy to upcharge you if you want quickly respond to your tech support needs Bandwidth (Data Transfer) to go beyond your allotted quantity of e- because the servers aren’t on site. Many mail addresses. You’ll also want to know resellers also don’t offer 24/7 support. Data transfer is the amount of actual if you have the ability to manage (limit) For an online presence, consider the data that can be transferred from your the size of an e-mail’s mailbox, forward domain host and its infrastructure the domain’s server to the Internet browser of e-mails from the server, generate autores- “foundation” for a successful business. As the person looking at your site. The amount ponders* and if it has a Web mail function with building a home, establishing a stable of bandwidth you use is directly related to so you can get e-mail from anywhere. foundation for your Web site is critical. the number of visitors your site receives. It’s important to look closely at the details Site Management with Control terms to know on the amount of traffic that’s allowed by Panels the package you’re purchasing. Bandwidth Autoresponders An automated is stated as a monthly limit in either mega- A control panel allows you to manage program that acknowledges receipt of bytes* or gigabytes.* You’ll want to check the different components of your Web an e-mail message, and then sends what the additional fees will be if you go over site from the ease of an online tool. Long back a previously prepared e-mail to your bandwidth limit for a month. If you gone are the days of having to contact the sender, letting them know their note plan to offer a significant number of down- your domain host to ask if they could set was received. loads, audio or video, you’re certainly going up a new e-mail account for you. A control Gigabytes Expression used to to use more space and more bandwidth. panel gives the domain owner or adminis- describe storage capacity or amount of Kolodziej warns to be cautious of com- trator the easy ability to manage customer data. It’s a unit of storage measurement panies offering “unlimited bandwidth” information, establish and manage e-mail consisting of 1 billion bytes and about or “unlimited disk space.” He says the accounts, manage billing and payment 1,000 megabytes. It’s often abbrevi- fine print of those offers frequently traps information, etc. ated as KB. ebusiness owners. “I see it all the time,” he said. “People have to be a little realis- The Extras Megabytes Expression used to tic and it should set off major red flags if describe storage capacity or amount of someone promises unlimited bandwidth If you plan to do business through your data. Its unit of measurement is equal and unlimited disk space. If it sounds too site, it will be important to check if your to 1 million bytes or 1,024 kilobytes, good to be true, it probably is.” domain host provides shopping carts for and it’s often abbreviated as MB. its customers and if there is an extra price Server A computer connected Available Disk Space for that service. In addition, you’ll want to the Internet where Web pages are to ensure the host can handle Secure stored. Though this is an important issue, it’s Sockets Layer protocol. SSL is a method usually a bit overrated. Web pages are of passing sensitive information, such as Uptime The percentage of time a normally very small. Findmyhosting.com credit card details, over the Internet. All Web site is available. notes that, on average, a Web page may be communication is encrypted to prevent

20 NFIB Guide to eCommerce | February/March 2007 E-mail Marketing Easy and Effective

Requires no programming skills

By Kerry Murdock, Practical eCommerce publisher

Jennifer Gordon is the or technical expertise to compose and Sample e-mail newsletter from Staffing owner of Sojourn, a Chicago-based retailer send. Though you can use your computer’s Advisors. of apparel accessories. She utilizes e-mail standard e-mail software (Microsoft Out- to market her products, and she says it’s look, Outlook Express or other conven- consultants. Gordon founded the firm six the best marketing investment she’s ever tional e-mail software) to send messages years ago. Sojourn sells its products via its made. Bob Corlett owns Staffing Advi- to multiple customers, e-mail marketing Web site, through home-based parties and sors, a human resources consulting firm software allows you to create profession- sells wholesale to other retailers. “We’re in suburban Washington, D.C. Corlett ally-designed e-mails, include logos and very cautious that we don’t waste our cus- sends three monthly e-mail newsletters images and track the success of your e-mail tomers’ time with frivolous e-mails,” says that have, to date, generated 30 percent of campaigns. Gordon. “We send our newsletter monthly, his firm’s total revenue. And there’s Jen- “We pay Constant Contact, our e- and we’re careful to offer Web-only specials nifer Gehrt, who is the co-owner of Com- mail provider, $30 a month,” says Jen- and other legitimate incentives.” muniqué, a Seattle-based public relations nifer Gordon of Sojourn. “For that, Sojourn, Staffing Advisors and Com- firm. Her News from Communiqué e- we deliver roughly 700 e-mails and muniqué have Web sites, and each of them mail newsletter generates one or two new we design and implement the e-mail offer their free newsletter(s) there. Folks client leads every time she delivers it. template* ourselves with their online who subscribe to these newsletters are E-mail marketing is changing the way tools. It’s extremely easy. I have a sales presumably interested in the respective many small businesses communicate with and marketing background, and I’m products or services, or they would not customers and prospects. To understand very low tech. But I can design profes- have bothered to sign up. The e-mail ven- it, think first of what it is not. E-mail mar- sionally-looking e-mails and send them dor* provides the sign-up box to put on the keting, properly done, is not buying a list out.” merchant’s Web site, and the vendor also of e-mail addresses and blasting unwanted Sojourn has three employees, in addition provides tools to manage the list of sub- sales offers to them. That would be spam*, to Gordon, and it has 34 independent sales scribers. These tools include determining and e-mail marketing, properly done, is not which e-mail addresses are no longer valid, spam. Likewise, e-mail marketing is not looking for a vendor? which subscribers have opened the e-mail false product offers or misleading adver- There’s no organization of e-mail and which subscribers have clicked on a tisements. That would be deception, and companies from which to locate a link in it. e-mail marketing is not deceptive. vendor. We suggest you check with With these tools, one can test and What it is, however, is a legitimate form your hosting company or Web devel- experiment with various e-mail campaigns. of communication to customers and pros- oper for recommendations. We also You can gauge, for example, whether more pects who have requested to receive the recommend an “E-mail Management” subscribers open* your e-mail on a Monday e-mail and who are otherwise interested in list assembled by B to B Magazine, at or a Thursday. If, for example, 20 percent your products and services. It’s very afford- BtoBonlinedirectory.com. of your subscribers open your monthly able. And it requires no programming skills e-mail when you send it on a Monday and

www.NFIB.com 21 40 percent typically open it on a Thursday, you may want to send it only on a Thursday. Likewise, certain offers may consistently I love e-mail marketing. It’s a gold- generate more leads or sales than others. mine. I know nothing about Web site You’d want to drop those offers that gener- creation or HTML, but I can fill in ate fewer leads and focus on the ones that the form, upload my photos and play work. E-mail tools, provided by virtually with the look. Then I hit send, and all all e-mail vendors, will tell you that. 1,667 customers have our specials in Not all e-mail newsletters offer products their inbox. I limit my e-mail to once for sale. Bob Corlett’s Staffing Advisors monthly, and have the coupons valid uses e-mail to educate his subscribers on all month. I know it’s successful based human-resource issues. Corlett founded on the response rate and the outcry from customers if I’m a day the firm five years ago and has three other or two late sending the e-mail. We have about 300 coupons employees. “Our customers are typically redeemed each month— a very high response rate for our list human resources departments that are size. Compared to the direct mail where I had under a half a looking to hire an employee,” says Corlett. percent response rate, this is a no brainer. “Knowing that, we try to help these depart- ments by writing about staffing trends, » ABBY WEAVER, MARKETING DIRECTOR studies and other helpful resources. I’ve web site Fajitagrill.com never made a cold call in my life. But, I try sells Mexican Food Restaurant to establish our firm as the thought leader for our customers and potential custom- relations firm, uses its e-mail newsletter terms to know ers and to maintain top-of-mind aware- for education and building relationships. ness among them. The exposure from our Jennifer Gehrt co-founded the firm three E-mail vendor A company that newsletter has generated speaking engage- years ago. It has grown to seven employ- provides a software or Web-based e-mail ments and other invitations that we would ees, and she anticipates hiring more in marketing service for small businesses, not have otherwise received. All of that has 2007. “We’ll include three to five articles associations and nonprofit organizations. generated many new and repeat clients for in each newsletter,” says Gehrt. “These The e-mail product sold by most vendors us. Probably 30 percent of our business is articles can address tips for hiring a public allow small organizations to easily create because of the e-mail newsletters.” relations firm, but we also profile our cli- and send professional e-mail newsletters, Corlett provides a free newsletter sign- ents and employees in them. We’ll suggest promotions, announcements and more up box on his Web site, and his subscrib- when a company should hire a public rela- with no technical expertise required. ers have grown by more than 200 percent tions firm. We try to always include pho- HTML A “language” used to create in two years. “One of our newsletters has tos and graphics and to otherwise make documents on the World Wide Web. grown from 646 to 1,472 subscribers in the newsletter visually appealing. We two years,” says Corlett. “This growth has know nothing about HTML, but, with Open rate The open rate is the mainly come from visitors to our Web site our e-mail vendor, we don’t have to.” percentage of e-mails opened by your and from subscribers forwarding the e- Gehrt says visitors to Communiqué’s subscribers. It should be a percentage mail to their friends.” Corlett continues, “I Web site can sign up for the newsletter, but of those e-mails delivered to a working don’t know a lick of HTML*. But you don’t she also adds potential clients to it herself. e-mail address, not just those e-mails need to know HTML to send these things “We’ll meet potential clients at trade shows sent, as not all sent e-mails can be out. E-mail vendors make it so easy.” and elsewhere,” says Gehrt. “We want them delivered. There are dozens of self-service e-mail to read our newsletter even if they haven’t Spam “Spam” is unsolicited e-mail. vendors. (See accompanying sidebar for a subscribed. So, we’ll call them or e-mail “Spamming” is the practice of sending list of reputable firms.) Most all of them them asking for their permission to send massive amounts of e-mail promotions, provide ready-made, full-color templates, it. I don’t think anyone has ever said no to advertisements and scams to people and they also provide options to use your that. But we always ask. We never send it to who have not asked for it. own template. Designing and composing a potential client without his permission.” an e-mail require no programming skills, “The newsletter is really our main Template A set of pre-designed and you can easily upload logos, product form of advertising,” says Gehrt. “It’s formats for text and graphics on which photos and other images. Most vendors so inexpensive. We deliver it to about new documents and Web sites can be provide screens to preview an e-mail 600 subscribers every six to eight weeks. based. before you send it. We’ll get engagement queries each time Communiqué, the Seattle-based public we send it.”

22 NFIB Guide to eCommerce | February/March 2007 Why Search Engines Are Important What if you opened a business and nobody could find you? Quick: Who is the prime minister of Canada? By Ryan Welton, Practical eCommerce staff writer Time’s a-tickin’. Those of you who turned to an almanac or an encyclopedia likely took 10 times might be all the rage, it is vastly more do not charge a fee for appearing on their longer to find the answer than those who important to have a Web site full of rel- list of organic results. opened a Web browser* on the computer evant text about your business, products Free is great, but getting consistent and did a search at Google.com. and industry. and high results from a natural search is Finding basic information on the Web sites use a feature called META tricky business. Your site might show up Web takes seconds using search engines, tags* to be easily categorized by search on the first page for a query or might not with Google the most popular among engines. These tags contain Web page show up at all. It depends on the depth them. There are about 101 million Web titles, descriptions and keywords. and quality of your Web site content, sites on the Web, and search engines A merchant’s goal is to be displayed including META tags. have the technology to sort through the on the first or second page of the list- If you are determined to do it the multitude and provide an index of the ings returned by a search engine dur- natural way, prepare to work. SEM cam- results, as requested by the user. ing a keyword* search. Specifically, if a paigns devoted strictly to getting listed Obviously, using a search engine is person types in “knitting supplies” at a organically require a significant amount much better than sifting through mil- search engine, Marysknittingsupplies. of effort and perseverance. Links to lions of individual Web sites to find a com wants to be at or near the top of the industry-relevant Web sites can boost single piece of information — the search list of Web sites the engine generates. your position. You can also hire a firm engines do the work for you. Most users will naturally choose sites to help you find ways to improve your high on the list — fitting, since one term ranking among the organic listings. How Does It All Work? for a general-interest query is “natural Business owners should strive to “truly First and foremost, the content on your search.” Natural searches (like the knit- understand your customers and their jour- site is used by search engines to identify ting supplies example) are also referred to neys online,” said Jeffrey Pruitt, president your site. So, while cool, hip Web designs as “organic” searches. The search engines of search operations for iCrossing, a Scott- sdale, Ariz.,-based SEM firm. In essence, that means figuring out the most likely Natural Listings Paid Listings phrases or terms customers rely on to find your site. Many business owners opt to include paid-search campaigns as part of their marketing efforts. Pruitt said paid-search campaigns can help smaller, lesser-known businesses compete against larger compa- nies and even expand into markets they have yet to penetrate. With a paid-search advertising cam- paign, a merchant pays a fee to appear on Results of a Google search for “small business help” the results page whenever a user types in certain keywords. If a user searches

www.NFIB.com 23 for “knitting supplies,” merchants who He cites research indicating 70 to 80 information about a product or service have bid on those keywords will typi- percent of click-throughs* on Google are because the information indexed in cally appear in an area noted as “spon- via organic-search listings. In other words, them is specialized and focused. sored links.” If you can’t work your way most of the time, prospective custom- If you balance your focus between to page one of the free listings, you can ers click on those listings that didn’t cost developing a Web site with rich content buy your way to prominent positions businesses a dime. On balance, that would and a well-planned, conservatively bud- — if you’re willing to outspend others mean spending money to improve your geted paid-search campaign, it could who want the same keywords. He who organic listing could cost less in the long result in new customers and new sales. pays the most is listed first. run than spending a considerable sum on The key word in this case is “could” Paid search is frequently referred to paid search. In general, SEM firms recom- — because the only thing we know for sure as pay-per-click* advertising because mend a balance when prioritizing paid and is that consumers will use search engines each time a potential customer clicks on organic search. to make purchasing decisions. It’s how your ad at the search engine and gets for- you position your Web site and execute warded to your site, you are charged a fee How Many Search Engines Are There? an SEM campaign that will determine by the search engine. Even though this Customers can choose from a variety whether consumers find you. could result in a costly advertising bill, of search engines in the marketplace. you know that you paid for a customer Besides Google, other popular sites terms to know who saw your Web site. That can’t be said are MSN, Yahoo! and Ask. Likewise, for any other advertising medium: just industry- and market-specific search Browser Software program used to because a customer heard your ad on the engines, called verticals, allow consum- view and interact with various types of radio doesn’t mean he came to your store. ers to research information. However, resources available on the World Wide Most search engines have easy-to- respondents in the Enquiro survey for Web. Netscape and Internet Explorer understand functions to allow merchants the report “The Role of Search in Busi- are two common examples. to set up daily ad budgets so merchants can ness to Business Buying Decisions” control expenditures. If you paid for the tabbed Google as their search engine of Clickthroughs This term is keywords “knitting supplies,” once your ad choice 83 percent of the time. used to describe the ratio of clicks to budget at the search engine was exhausted However, companies that market to impressions on an advertisement, usually for the day, your ad would no longer appear other businesses or a targeted group of a banner ad. If a banner has been shown when the keywords were entered. When consumers might instead take advantage 100 times and three people click on it, it will have a 3 percent click-through ratio.

Keywords A word or phrase that you type in when searching for informa- Our pay-per-click costs have tripled over tion in a search engine. the last year. New sites are coming in all the META tags Meta tags describe time and just throwing money at Google the content of the document in which and Yahoo! to keep their No. 1 spot. It has they’re written. These tags are not definitely hurt our margins trying to compete, visible to site visitors. They are only and these sites come and go. So now we really visible in the code. concentrate on striking a balance between Pay-per-click Paid search is a organic search and pay-per-click, eliminating method of advertising. The advertise- any redundant pay-per-click listings. ments are placed on search engines (such as Google, Yahoo! and MSN). » RICHARD SEXTON, OWNER The ads are in text (no graphics, yet) web site Carolinarustica.com and are limited to a certain number of sells Furniture and home décor items characters. The ad appears on the search engine when someone types a keyword or keyword phrase you have “purchased.” the next day begins, your ad reappears as of vertical search engines that focus on You “purchase” the keywords by bidding long as you have ad monies allotted. particular topics or niches. against others in a competitive process. Paid searches do not work like magic Examples of these vertical engines Generally, the higher you bid for a potions, Pruitt said. Spending more include WebMD.com, Tripadvisor. keyword, the more prominently it will be money does not automatically mean com, Search4Science.com and Business. displayed in the search listings. more customers. com. People use these sites to research

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