I recently got an edition of SmallBusinessNewz in my inbox with an article by Chris Crum on “7 Steps to Earning Customer Trust Online”. The complete article can be found here. I thought it was worth mentioning here, as I’ve been striving to build credibility and trust in my own online store. At the risk of ruining your read of the actual article, I’ve re-summarized the 7 points here as well, though with my own notes.

Chris starts with a stat claiming that 81% of consumers don’t trust small online businesses. Shocking? Not really, if you think about it. Personally I’ve grown over-used to trusting things online, and I’ve slapped down my credit card for more offers than I care to think about. So it came as a small surprise to me the other day when my sister asked my advice on buying a study guide online. I had a look at the sales letter, and turns out it was hosted by ClickBank. To me, that was golden. I realized though, that for most people, at least that first initial ebook purchase can be quite intimidating. The same holds true for physical goods.

So what’s important?

1. Branding

You might ask what can a small company do in terms of branding? Well there’s lots. You don’t have to be Coca Cola with $58.2 billion of brand equity to be successful at branding. I’m working hard on this with my store, DigitalFrameGuy.com. Putting forward a consistent image, whether it be your logo, your signature, or your marketing claims, all helps to build your brand. People tend to trust the familiar more than the unknown, unless you’re one heck of a copywriter.

2. Make Yourself Appear Larger

Do you have a toll free 800 number? If not, go get one for $10 a month. I specifically chose an 800 number over cheaper 888 or 877 variants, simply for the psychological “big company” factor. If you hear 1-800, your brain has been trained to think corporation. Even though it is just me, there are ways to appear much larger.

Using your home address? Throw a “Suite 110″ in front of it and mail yourself a letter. I’m actually trying this as I write it, but I’ve read it works. Plus, chances are “Suite 110″ sounds more official than your street address. By law you need to include your address on emails (for instance if you use Aweber), so why not try to use that as a trust builder?

On your email and voicemail, you can create separate departments as well. Now, you don’t want to confuse people or cause unnecessary bureacracy, but separate lines for service and sales is usually pretty straightforward. You can do that all for free with Ring Central.

I’ve got more ideas, but perhaps that is a whole separate post

3. Design

Site design is crucial. Ever visited one of those websites that was clearly somebody’s 1990’s brainchild that never grew to maturity? The instant I see a site like that, red flags and alarm bells start up even as I’m clicking back to Google. People tend not to trust the digital donkeys that don’t have modern site designs or technology. Plus, the site needs to be straightforward and easy to use. Have you searched for your site in the search engines, and then followed the process all the way through to checkout? I did that the other day and found a glaring error that I fixed immediately. You might be surprised with what you find.

4. Reputation

I care quite a bit about my businesses’ online reputation. Once that gets dragged through the mud it would be very hard to recover. Because I want people to trust me, I’ve given my customers my 100% guarantee that I’ll take back their order for any reason within 30 days. If my supplier won’t take it back, then I’ll be on the hook for it. However, I’d prefer to sell it on Ebay for a bit of a loss than to take the PR hit in some forum or blog somewhere. I recently stumbled upon a blog where the owner had had a run in with one of my competitors (do you Google to see what your competition is up to?) and he had quite the horror story going on! I jumped into the comments, trying to console him while at the same time explaining how my store was different. There are emotional people online, and they won’t keep silent. Use it to your advantage. Provide much more than they anticipated and they’ll heap praises on you! Let the down, and you better look out!

5. Security and Privacy

SSL certificates. Privacy Policies. No, you cannot sell or rent your list. Pretty straightfoward, but some merchants still aren’t getting it.

6. Testimonials

People are far more likely to believe someone else who’s walked a mile in their shoes than they are to believe you. Get over it. Once you get over it, use it to your advantage. Don’t have any testimonials yet? Have you asked? Send out an email asking for testimonials to all your past clients. Offer them a discount or something if you want. But you must use testimonials - they are a very powerful marketing tool!

7. Humanize Your Business

I started out right from the beginning with this one, calling the store “Digital Frame Guy” which has a personal feel to it. My logo has a guy in it, and I’ve tried to keep the site copy personal, especially the guarantees and such.

Looking for more ways to personalize your site? Put a picture of yourself the About Us page, or do some employee profiles. My next step is video - I’ll shortly be rolling out a series of videos for the site which I hope will both drive traffic and build a personal touch for the site. If you’re doing a video series, you’ve got a great opportunity for branding there as well. More on that in a different post, once the videos are out. We can’t give everything away all at once, can we? =)

Do you have any other suggestions or comments for building trust online?

Lately I’ve seen a couple different product launches, all geared towards taking advantage of eBay. It’s like a whole bunch of people suddenly found a jar of eBay pixie dust and started throwing it around the marketplace. The two I’ve come across are the Four Tier Annihilation method and the eBay Code. Four Tier is your standard $77 ebook with a video upsell. The eBay Code is more like $1497, not sure if there’s an upsell (I didn’t get this one, my pockets aren’t that deep!).

So anyways, being the eternal sucker that I am for a good sales letter, I picked up a copy of Four Tier Annihilation, and read through most of it today. Here’s the basic plot. Guy is broke, living in a friend’s basement, etc. Buys every internet marketing product out there and fails miserably until he stumbles upon eBay by accident one day. One thing leads to another until now he makes tens of thousands per month, and has trained many others to do the same, not to mention you! Strange how many of these stories all sound so familiar… yet I digress.

So cut to the chase, right? Ok, so he advocates a few different ways of selling on eBay. The first that is dealt with is dropshipping. Probably most people have heard about that. Dropshipping is this sweet setup (which I’m trying to get going with my digital frame store) whereby you secure a supplier to ship small quantities of product on demand, directly to your customer. So you make the sale, then the dropshipper fills the order. You never carry inventory. It really is a terrific setup, allowing the seller to automate his business as much as possible. Anyways, probably the best part of the dropshipping segment is where he talks about how he goes about doing his research into which eBay niches to enter. Using the advanced search feature in eBay you can checkout all the closed sales in each category. Find an item that looks decent, and has closed for a good price consistently, then lookup the seller in a tool such as Goofbay. From here you can see how much they’re selling, and judge whether there is profit potential in the niche. Quite fun to find sellers that are doing $10,000 a month in eBay sales. Then he goes into finding suppliers who will dropship for you. This is the part that I’ve personally had the least success with so far. Mind you, at the time the product I was looking for was a bit harder to find. I’m quite interested in taking another stab at it with a more common product.

So moving on from dropshipping to info products. You’ve probably seen the $1 ebook craze on eBay. Well apparently that is going to be changing, as eBay has brought in new terms and conditions disallowing download-able products. Of course this means you just have to outsource CD creation to a company like Kunaki.com and charge more for your product. Still, it will keep a lot of people out. So he talks about how to get ebooks you can legitimately sell as your own, without spending a whole lot, and how to find the good niches. There’s a lot of good information there.

One little nugget mentioned is worth gold, in my opinion. He talked about how after successfully selling a bunch of cellphones like crazy on eBay he created a short ebook on how to sell phones like crazy on eBay, including the contact info of some of his suppliers (note: withhold your best supplier for yourself!). Then he would advertise this ebook right beside his cellphone listings, and sell it for $47 or so. Basically, look at me - I’ve got a successful cellphone store on eBay, and I’ll tell you exactly how to do it to! Cool concept. Of course, only 3% of people who buy info products actually act on the information that they contain (according to him - not sure where the stat comes from or the validity of it). So because only 3% will act on it, you’re not even really exposing yourself to much increased competition, plus you’re already established in the marketplace. Sounds like he ended up making more cash off the ebook sales than off the cellphones!

He goes on to talk about flipping websites on eBay, outsourcing the creation of simple turn-key web businesses, etc. Basically there is lots of good content in ebook. I’m not really concerned about giving away all the Four Tier Annihilation secrets in this short post, as the ebook is 175 pages or so. Nothing terribly mind-breaking in there, but definitely more than enough information to make a healthy living on.

If you’re one of the 3%.

I recently read a post talking about how recession is going to be great for affiliate marketing. Although a bit shy on details, he did make a couple good points. The general idea is that merchandisers tighten up their marketing budgets going into the recession. So far so good. The traditional forms of advertising are becoming more expensive anyway, (print, TV, radio etc) so those dollars will naturally gravitate to he most efficient marketing method - the internet. This means a huge influx of marketing dollars all over the internet.

I would add though that supply and demand economics dictates a stabilization over time - there will always be tremendous marketing value in TV ads for example, and if they temporarily become over-priced, more dollars will flow to the internet, but eventually this will cause TV prices to come back to a  sustainable level. As long as there is value in any marketing channel it will never cease to exist, even though there may be large fluctuations in price or use.

I’ve been thinking about this topic a bit lately. One of my best affiliate offers is a loan product, and people sometimes ask me if business is slowing down. Fact is, I don’t really know, because I keep looking for new ways to promote it and it keeps growing. If it keeps growing, people are still getting loans in droves (personal loans).

I think a smart affiliate marketer will take advantage of whatever current market / economic trends are happening. Recession appears to be on the menu for the near future, so we might as well start evaluating to see how we can take advantage of it. People make money in market ups and downs - just a lot less people make money on the downs! If we’re smart we can be among the few!

To succeed in business on the internet, you need to pick a niche and specialize. There simply isn’t a lot of room for more eBays and Amazons out there. There will always be a few of these uber-players in the game; ingowever the vast majority of successful businesses on the internet are specializing in a niche.

I’m going to assume that I don’t need to convince you of the merits of choosing a niche; it is one of the most talked about things in internet marketing. Instead, I wanted to focus on some concrete ways that you can go about identifying a market niche that is going to work for you. This process is well suited to those who are looking to develop a product of their own, though it will work equally well if you’re planning on building a site promoting affiliate products.

Researching a Market Niche

1. Brainstorm. Take a piece of paper and start writing any market idea that comes to mind. The conventional brainstorming wisdom applies - don’t discard any idea - just write it down! Even if you don’t think it is any good, write it down!

Think of your own hobbies or those of your friends. Think of a common problem in people’s lives - is there information out there, or a product, that can solve it? If you absolutely can’t think of anything, go to the public library or a good sized bookstore and have a look at their magazine section. Magazines represent topics people are interested in; topics that people are willing to pay money for more information on. Once you’ve got 25-30 topic ideas on paper you can move on to the next step.

2. Research Keywords. You don’t have to come up with an exhaustive and comprehensive list at this point of every keyword you’ll ever use in the niche. Rather, use this step to get a feel for the highest traffic keywords in your niche. Try to pick around 5. Go to SEOBook.com and use their free keyword tool. Type in what you think is the main keyword for the niche, and see what you can find out. There are likely other common variations or sub-niches you haven’t thought about.

3. Assess the Niche Potential. Ultimately, you want to be able to deeply penetrate your chosen niche. Go through your list and consider whether each niche has the potential for additional products. Would it be possible to create a home study course around it? A membership site? Something you could upsell your customers on after the initial product? How about a monthly newsletter? Is there sufficient depth that people are likely to pay for additional products? Is there a good selection of affiliate products available for that niche? Checkout the usual culprits for this: Clickbank, PayDotCom, CJ, LinkShare, etc. You might need to search around in your niche market to find some good products, then google those products + “affiliate” to see if there are affiliate programs available.

4. Understand the Niche. Now that you’ve hopefully narrowed down your list somewhat, take it to the library and see what kinds of magazines and books exist on your subject. What topics are they writing about? Are there sub-topics that have product potential? Keep your eyes open for complementary niches as well. Once you’ve developed a list of customers, people who have purchased your main product, you’ll want to be able to continue to use that list to sell your customers other related products in the future.

Another idea is to go to Amazon.com and type in your top 5 niche keywords from step 2. See what products come up. Amazon can show you a ton of useful information about your target niche. You can see what people thought of competing products (ie what they liked and disliked), as well as additional products that they purchased. Try to get a feel for the price points as well.

5. Check for a Community of Interest. Go to Google and type in your niche keywords and the word “forum” and see what comes up. Click on a bunch of the results. Are people talking about your niche market, or is it dead? If forums exist on the topic, check them out and see how many active users there are on the relevant threads. Try to get a feel for the topics they are discussing, and the level of participation. Take note of the best forums, as you’ll want to come back to these later on to participate and promote your own product.

Another idea is to go to blogsearch.google.com and search for your niche in there. See if blogs come up on the topic, if so, check them out for content and try to get a feel for their traffic volumes. Are people actively commenting on the posts? Identify the best forums and blogs, as you’ll want to come back to these later to participate and promote your own product. You can also look for article directories.

6. Check out the Competition. Run searches on the main keywords for your niche and see what paid ads come up on Google and Yahoo. What products are being promoted? What are they doing well that you can emulate, and what are they doing poorly that you can do better? Checkout the organic listings as well. Read their squeeze pages and sales letters. Do they have newsletters available? Sign up for them; see what they’re talking about. Keep your eyes open for products you could partner with in the future.

7. Don’t Slack Off! This might seem like a lot of work, and it is. Choosing a niche market is possibly the hardest part of the whole process, and arguably the most important. Put your head down and slog through it. Once you’re established later on you’ll be happy you did.

What is affiliate marketing, and why is it worth doing?

Simply put, affiliate marketing is a way of sharing revenue between a company and its affiliate based on performance measures. The affiliate is not employed by the company, but there is an agreement in place that allows them to promote the company’s products and to get rewarded for that in a specific way. Affiliate marketing is huge on the internet. The benefits are many, as we will see.

Let’s use an example that everyone is familiar with: Amazon.com. Now you might ask, why would a company as huge and successful as Amazon need or want an affiliate marketing program? Why would they want to share their revenue? Well plain and simple, it saves them a lot of work. Amazon has setup an arrangement whereby nearly anyone can sign up as an affiliate to promote their products. The affiliate is then given tools and specially coded hyperlinks which they use to promote products for sale on Amazon’s website. They drive traffic to Amazon.com, which hopefully converts into sales. If the affiliate refers someone who actually buys something, then Amazon will give the affiliate a set percentage of that sale.

What’s in it for them?

The benefit to Amazon is that they get a veritable army of affiliates promoting their products in all sorts of ways all over the internet. They end up with very good marketing coverage this way. You have to remember that in order to get advertising and links plastered all over the internet, in every nook and cranny, Amazon would have to spend a ton of money. Either they would outsource this lucrative contract to some large firm, or they would hire a whole bunch of advertising experts in-house. Instead, they are able to contract with affiliates who go out and advertise all over the place, and - here’s the best part - Amazon only pays when a sale is generated! Amazon can then go and confidently plan around the fact that their affiliate related marketing will cost them 4% of sales, or whatever the number is. None of this pay $100 million and I’m sure we’ll get some good coverage! They only pay for advertising that generates cold hard cash!

What’s in it for you?

So, sounds like a great deal for Amazon right? But is the affiliate marketer getting a bad deal? Not at all. So what makes this a good deal for the affiliate? Well there are a lot of people out there with websites, resources, and expertise to successfully market products; however they don’t have any products of their own! The affiliate arrangement puts a product in the hands of the marketers, without them having to deal with inventory, handle transactions, tech support, returns, suppliers, importing, shipping etc. The barriers to entry are negligible for an affiliate marketer, compared to the owner of the web store.

Marketers also benefit from having the guaranteed terms of a contract. They know exactly what they need to achieve to get a paycheck of X dollars. Affiliate marketers then create websites, pay-per-click ads, email campaigns, banner ads, social marketing campaigns and all kinds of other things in order to drive highly targeted traffic to Amazon.

Most affiliate programs have a sliding incentive scale of some sort. For instance, for the first $1000 of sales an affiliate refers within a given period, they might get 4%. For the next $1000 they might get 5%. In this way companies are able to reward for performance and the best affiliates will be even more motivated to continue on their promotion.

Affiliate marketing can work for nearly any kind of product out there on the internet right now. Think of it as a referral fee. Some of the products I promote don’t even involve sales; the client doesn’t actually purchase anything. In these cases the company pays for “leads,” that is, qualified people who fill out an application form. So all I need to do is get people to fill out the form, and I get paid! They don’t even have to spend a cent! Good deal for me right?

If you have a website, affiliate marketing is a great place to get your feet wet making money on the internet. Find an affiliate program for a product that is complementary to the interests of your site’s visitors, and promote it on your site. If you’re feeling more aggressive and you find a good product to promote, try paying for advertising on the internet! You’d be surprised how easy it can be to get going!

All the best in your ad.ventures!