My wife and I are trying to decide wether or not to embark on a new e-commerce business venture. It would be a site selling essential oils and aromatherapy products, something she has interest and background knowledge in. I have a fair knowledge of website development and Internet marketing and so can assist in this area. I have a couple of questions that i would really appreciate the community here at DP commenting on. Never done E-commerce before so it's all a bit new to me. 1. We are trying to asses the market first, to see if we can find out how much we could actually earn from this. Q How would i go about this, I know that you can get rough traffic estimates and could apply some average conversion rates / profit margins etc. to this but is there a better way? I have tried downloading some company reports from companies house in the U.K. but mostly the turnover/profit statistics are witheld. 2. Is PPC advertising viable for an E-commerce store that has a small profit per customer. I am trying to work this out. Looking at some keywords on adwords keyword tool, bids are in the region of £1.00 for most keywords. If I estimate that out of 100 clicks 5% will actually become a paying customer, and on average each customer will give us a profit of say £5.00, I would have to spend £100 to get 5 X £5.00 = £25.00?! Is this right? am i working this out wrong? I would have to lower my bid price to £0.25 to just break even. And what would that give me? Is there anything im overlooking or is it just fact that adwords are only for the big boys that have large average sale per customer, or markets that have high priced goods. I just can't understand why similar businesses in this same niche would still pay £1.00 for these customers - or is it to do with building a 'list' and repeat customers? Any advice would be greatly welcomed.
1. You can buy reports from companies such as http://www.creditgate.com . 2. PPC can be applied to the majority of websites.. you would need to work out how much you are prepared to spend to acquire a customer. You could think about buying an existing aromatherapy website . There are sites which lists websites for sale. Good luck in your new venture.
Your calculations are right, PPC is only worth it if you sell medium-high priced items. SEO/Articles would be your best option and email list building too.
Normally for market survey,i would hire an insider of the competitor company to reveal their company sensitive information to me. Although the fee is quite high,but the end result is worth it.