However, I find I have something to say outside of the practical business of setting up an internet business. I have something to say about common sense, about hard work, and the reality of online businesses in general.

Excerpts from two different emails received recently:

My online store has been live for two weeks. Although I'm getting lots of traffic from Google ads and other advertising I'm running, I haven't had a single sale yet. Where are the sales? What am I doing wrong?

I am getting ready to start a store online. All my products will be drop-ship for the first year. I have projected a average of 3-5000 orders after 3 months. My launch date is in spring.

I realize that some of what I'm about to say is preaching to the choir here, but I hope you'll share it with the less online savvy in your own social circles.

Online business is not a Kevin Costner movie.
Just because you build it, does NOT mean they will come.

Let's think in practical, offline terms for a moment. If you want to produce a print magazine, what kind of knowledge will you need to have, learn, or buy? You'll need marketing, editorial, design and layout, ad sales, distribution, print process, shipping, and those are just what I can come up with off the top of my head.

By the same token, if you want to open a store in the real world, you'll need to have, learn or buy knowledge in: sales, marketing, design, merchandising, real estate, finance, building management, buying and ordering, research, and again that's just off the top of my head.

On top of that, every business needs someone who knows financial, who can crunch the numbers and evaluate the statistics of your business - how many buy vs. how many browse, how many pick up a subscription vs. how many buy off the shelf - as well as research all the nitty gritty things of your business that you can't even imagine right now. Because there's no way to improve your business unless you know how it's doing today.

Folks, it's the same online. Owning a business, whether online or off, is a largely thankless job. It is not - and I repeat NOT NOT NOT - enough to just learn HTML and learn search engine optimization and slap up a web site. Whether you open a restaurant or an online store, you'll need to not just get the word out about your business, not just service the customers you get, but spend hours every week for the rest of your life learning more.

That's because there is always more to learn. And it's a slow process. Getting started is slow, learning is slow, in fact the only thing out there that isn't slow is how quickly everyone else is moving around you. And yes, that can be panicky at times. The more you know, the more you'll realize how much you have left to learn.

The good news is if you keep trying, keep learning, keep giving it your all and keep your eyes and ears open for new developments, concepts, ideas and ways of doing business, if you read everything you can get your hands on and pick the brains of everyone you know who knows more than you do, if you keep customers happy and your business moving forward and never give up, odds are MUCH greater that you'll succeed.

But life isn't a Kevin Costner movie. Nor is online business like that old IBM commercial from a few years ago - set up a web site, see three orders in the first hour, then 10, then 50, until the counter is rolling so quickly you can't keep up with it, and all in the first day. Makes for a great, and memorable commercial. But it's the very rare few (think: lottery winners) who manage to accomplish that here, in the real world, where we're all doing business.

As in the old story, the turtle will (or may, at least) win the race. But it's a slow, dogged race, incremental in its early days, until you get the ball rolling.

If I've scared you, GOOD. If I've scared you but you're still wanting to try it because you know deep in your heart you can do it, BETTER. If you're scared but going to try even knowing you may fail because you're determined to keep trying until it sticks, EXCELLENT. Congratulations, because you're on your way to becoming an entrepreneur.

Stay tuned. More advice to come.

Breaking down your idea

In order for your web business to be successful, it needs to have several qualities. I've broken these down into roughly two areas: Internal (attributes specific to your idea) and External (how external market and cultural forces affect your idea). We'll cover Internal in this article; look for External in a week or so.

Internal attributes include:
Viability, expandability, scalability, and income streams

External attributes include:
Competition, consumer interest, lifestyle/culture trends

Viability

Let's start with your internal attributes. The first is viability. Is it conceivable that if you live and breathe this topic for the next two+ years, you will still be interested in it? That sounds like an easy question, but believe me when I say it can be complicated. People change over time. You might be very interested in Indian cooking for the next, oh, six months, but what happens when you're tired of eating and reading about curries? Is this a "fad" in your interest scale, or is this something that you'll be able to enjoy long term? Viability is the primary place where my first web business, Pathway to Darkness, failed. While I had some passing interest in the topic, I soon grew tired of it and began to be uncomfortable with being associated as "the ultimate vampire resource" girl. So take some time and be sure, before you jump in headfirst.

Expandability

Expandability is the next facet of your web business. If you're planning a content site (similar to Pampered Puppy, for example), is the idea big enough to be able to expand over time? Is there enough to say on the subject to write two or three new articles about it every month? Is there enough there to expand your content beyond monthly articles to other areas - say, product reviews, discussion forums, contests, blogs? You want to pick a subject that will provide you with lots of room and inspiration for content. The last thing you want to discover at the 6-month mark is that you've said nearly everything there is to say on the subject. Take a few moments and sketch out a rough editorial schedule for the first year, with additional ideas for other types of content.

Expandability is also important for a "service" site (think Flickr, Blogger, Amazon Lite). A good knowledge of software design and/or user experience design will help you at this point, because you need to determine what core features you'd launch with, and what could be added over time to improve the usefulness of your site. As "services" aren't my forte, I'll leave that list there, but I highly recommend you speak to/read from some experts in this area to help you determine expandability for your service site.

Scalability

Scalability is another important component. The ideas you're sketching out for your web business must be able to scale from 1 visitor per day to 100 visitors per day to 1,000 visitors per day and beyond. For example, if your idea centers around a community - discussion forums, social networking software, visitor submissions or reader reviews - that idea doesn't work well in all scales. Each of the examples I just used need a critical mass of users before the site becomes a useful resource. While depending on your users to help create the utility and/or content of your site is a great idea, you need to remember that only you will know about the site the day it launches, and you aren't working with large marketing budgets to launch your web business. Growth will be small but steady over the first few months. Make sure the visitors you do get during that time find something of use during that time.

Income streams

Once you have determined that your site is viable, expandable, and scalable, you need to ensure you're actually going to make some money from the thing. While the money will not (I repeat, WILL NOT) start flowing your very first day or even your first month, you need to ensure that you build a business that will allow you to eventually make money in several different ways. Multiple income streams are the key to building a successful business.

A bit of history on income streams. During the dot-com rage, everybody and their brother started a web business with a single income stream in their business plan: advertising. But I'm here to tell you that advertising is NOT the golden calf - it's incredibly challenging to build a web business that survives and pays you lots of money based on advertising alone. If you are hoping that advertising will be one of your income streams, you will need to take a look at your business idea to ensure it will attract advertisers.

Web businesses that attract advertisers have several things in common:

1. They are generally a very targeted site focused on a single, narrow niche (the broader the idea you're entertaining for your web business, generally speaking, the less money you're likely to make via advertising). Web sites about computers in general, for example, are not very targeted. It's too broad a subject to make itself a viable source for advertising. At least, not with the budget we're currently working with. :)

2. Their visitors are generally predisposed to thinking about purchasing products or services online. To take some examples from our original list... If your topic is history of medieval cooking, your visitors are going to be there primarily to learn (in most cases). "Learning" mode is all fine and good, but you'll have a much better chance at success if you choose a topic that pre-sets the concept of consumerism in your visitor's minds: restaurant guides or reviews, products used for food preparation, national supermarkets that deliver. The closer your topic is to the buying cycle for customers, the more likely it is you will be able to attract companies who want to advertise with you. (Remember the outstanding success of Lucky magazine?)

3. They are on-topic to attract a serious number of advertisers. In other words, if your business idea only extends to a handful of businesses (be they products or services) available online, then you're not going to have a large enough pool of potential advertisers from which to draw. For example, if you live in a not-very-wired city (i.e. not many businesses from your city are online) and your web business idea is to list local services, then your potential advertiser pool is very small. You want to ensure that your web business can attract the widest possible audience of advertisers without exploding the targeted nature of your web site into something too general.

4. They generally get a decent number of visitors per month. Which, for the time being, is not you. Reason enough to make sure there are multiple ways to walk to the bank for your web business.

Beyond advertising, there are many other ways out there to make money, and you need to be able to incorporate at least one other method of making money into your web business plan. Each of them come with their own pros and cons, and I could almost write a book on that subject alone, but for now I'll just provide a list of a few options to think about. Please remember that each of these income streams come with their own caveats! Do your research before choosing them!

Other possible income streams include: submission/subscription fees, affiliate income, print/digital products produced and sold as an extension of the web site, branded product sales.

Wrapping it up

The most important thing to remember about your internal evaluation is to be realistic about its possibilities. Discuss, evaluate, and don't be hesitant to discard for a new idea if your concept is limited in one of these factors. The goal here is not to push forward with the idea you've always thought would work; it's to have a successful business in the end. And at times, that means being flexible about what that web business will be.

But even once you've determined that your idea passes the internal evaluation with flying colors, we're not done. Now we need to take a look at the externals: competition, consumer interest, lifestyle trends.

I'll cover the next step, Evaluating an Idea (external evaluation), in my next post.

Now, if you don't already have one, you need an idea. How do you come up with a concept for a web site?

Do I need to be an expert?

Being obsessed about the subject of your web site is certainly a bonus, and some of the more popular and successful web sites out there are run by people who started with a deep abiding love for their subject. But even more web sites out there started with a thin thread of interest tying them to the topic, and expert-level knowledge of the topic only came after years and years.

My own sites are perfect examples of this. When I started Pathway to Darkness (once billed as the Ultimate Vampire Resource) I didn't know much about vampires at all - I'd read Anne Rice's books, owned one non-fic book on the subject (Melton's Vampire Encyclopedia, if you're curious) and had a short story on hand that I'd written in high school.

Pampered Puppy was no different. Although I owned a dog for the first time in my life, she certainly wasn't a spoiled princess when I came up with the concept for the site. She was strictly a PetSmart girl, and I couldn't tell a Gucci from a Versace.

In both these cases, learning, knowledge and appreciation came over time. Don't worry. You've got that time.

Don't make it like homework

However, I do believe strongly that you should choose a topic that is somewhat related to an interest of yours. There's a very simple reason for this. You're about to throw yourself heart and soul into this project. It stands to reason that if you have no interest whatsoever in the topic of your site, you're not going to be very motivated to do the research necessary to make a go of it (more on this soon, in research parts 1 and 2). The last thing you want when running a business is for it to feel like homework every day.

The goal here is to create a business for yourself that is fun and exciting: a learning experience and something that motivates and inspires you. That's why it's unlikely you'll ever see me do a site on industrial fasteners or sailing or Royal Doulton figurines.

Making a list, checking it twice

Let's take a look at how to expand on a basic interest into a list of possible site concepts. We'll take a common interest for most people - food - and extract it into as many possible concepts as we can come up with. The goal here is to take a topic and make a list of as many related subjects as possible. (If you're drawing a blank with your own interests, try your local library or even a Wikipedia search for ideas.)

Note that this list isn't exhaustive! You're likely to be able to add some ideas of your own to the list below. But it should give you an idea of how to compile a list.

Types of food
Vegetable (subsets like legumes, etc.), dairy (subsets like milk, cheese), meats (subsets like chicken, pork, beef), grains (subsets like bread, pasta)

Food preparation
Types of preparation: simple, for students/bachelors, family, gourmet, appetizer, meal, baking. Also food prep history (history of a certain ethnicity, history of a certain period like Renaissance or the 50's, or a more global look at history over many different time periods). Recipes (or certain subsets like by ethnic group or by ingredient). Products used for food preparation, or a subset (only grilling products, only baking products).

Food and health
Scientific (about the scientific links between food and health), diet (covering all the different diets out there, or focusing on one, or a few), ethnic (looking at how different populations' health is affected by how they eat).

Buying food
History of the grocery store, local resources for your area, global/national resources of grocery stores (or subsets: those that deliver, those that carry special items).

Eating out
Local resources for your area (or a subset: only open past 10pm, good breakfast places, places that provide takeout or delivery), national/global resources (or a subset: only Italian restaurants, only truck stops, only places you can eat for under $20), reviews of restaurants, guides on how to find a good restaurant, history of restaurants and eating out.

Most of these ideas on our list are perfectly acceptable as a web site topic, but not all of them extend well to be a web business. But how can you tell the difference?

I'll cover the next step, Evaluating Your Idea, in my next post.

Or you can bookmark this link.

I've also set up an RSS feed just for those posts, available here:
http://www.angiemckaig.com/ib101.xml

Hope you guys enjoy the series as it comes along. If you have ideas, suggestions or just something you want me to address in the series, don't hesitate to leave your comments.

"It's all about me."

When it comes to building a web site from scratch, something successful and useful that people visit and buy from and talk about, it really is all about me. Because I'm not talking about getting VC funding, a bank loan or angel investors here. I'm talking about bare bones, starting a web site on $300 or less, you being the only staff, bootstrapping at its finest.

A web site like this will only fly if you've Got The Right Stuff.

Do-it-yourself means Jack-of-all-trades

When you're Jack-or-Jill of all trades for your new web site, you need to either have knowledge or interest in a variety of topics. (Note that expert-level knowledge is FAR less important than a passion for learning and a willingness to keep digging until you figure it out, to keep improving over the thing you did yesterday.)

These topics include but are not limited to:

* technology - HTML, CSS, researching & installing software, trends
* design - graphic design, interface design
* selling - retail (b-to-c), marketing, advertising

That's right. That means above and beyond the idea for your business, you need to at least have some interest in each of these things for the web site to fly, unless you plan on bringing in partners early with interest and skills in this area. You don't have to be an expert - I certainly wasn't when I started out! - but you have to be willing to play with all of these things, learn about them, get better at them a little bit every day.

If that's not you - then no matter how great your web site idea may be, it's not going to work.

A web business is not a quick fix

You have to think about the time you're willing to devote to your new internet business on a regular basis for the next 12 months minimum. Successful web sites aren't something you throw up there and then sit back and watch the cash roll in. They're living, breathing entities. They grow and change, interact with their visitors, offer something new and valuable to each visitor every time they return.

The success of a web site is measured in its value to its visitors. Web sites that make money, by and large, are ones that engage the visitor and provide them with something they need, want or like. And believe me when I say that creating a site that provides this can take more time than you think!

The minimum amount of time you're willing to put in should be no less than 15 hours per month. More if you can spare it, but be realistic, set a goal, and stick to it every month.

A web business means you have to know the web

Finally, you have to take a critical look at how much time you're willing to spend online, particularly if you already have a full-time job that also requires you to be in front of a computer. A good internet businessperson spends a lot of their time online - looking at search engines, researching, viewing competitor's sites, viewing other web sites for general trends in content, selling, advertising and more. That's even before things like email, RSS feeds, etc.

If you have all of the above - a desire to learn about technology, design and selling, 15 hours a month to work on the business, and willingness to spend a chunk of your time every month online looking at other web sites, then I have good news...

Your business already has a lot going for it! Next up: finding your idea.

When you're known as web site girl, the one friend who does everything online, and She Who Invented The Internet (and yes, that's a nickname I've picked up over the ages - what the heck, if Al Gore can claim fame to it, then so can I), lots of people come to you with their web site ideas. If I had a dollar, in fact, for every time I had someone ask my opinion about their web site idea, I wouldn't need to go out and build Internet businesses. ;)

Every time I start this conversation with someone, I get frustrated. I wish I'd had the time to write the book that's bursting out of my ears on the subject, so I could just give them a copy, since I say the same thing over and over and over again.

But then, I've been too busy building Internet businesses to actually write a book about building Internet businesses. At least, so far.

For now, though, perhaps we can make do with this wee blog.

I'm starting to flesh out entries (I have about three right now, with many more crowding in behind wanting to be told) to walk people through how to do it - how to decide if an idea is any good, how to build something from scratch with very little cash but lots of sweat equity, how to grow from an idea to a fully functional web site that not only pays for itself but eventually deposits some money back into your pockets.

I'll post the first few entries over the next week or so; and here's where you can help.

Are there specific things out there that you'd like to know, how to do X, how to figure out Y? If so, please leave a note in the comments, or send me an email. Otherwise, I'll try to cover the best of what I know, in the order that I think applies for most situations.

(Many thanks to Colleen, who encouraged me to get off my butt and write some of this stuff down.)

Stay tuned. We begin in a few days.