|Ðð©'§ Pay-Per-Click Advertising Information Library|
Market Research Means Money
I recently made a critical mistake in my progression towards business success: I forgot about market research. I had decided that I was going to make some money with an online store. I thought to myself, where should I start? What can I sell? After a bit of brainstorming, I picked a few things that I thought might be good to sell online. I then proceeded to start looking for suppliers. This may seem like a reasonable course of action, but it is not. It is missing a key component of any business plan.
A basic assumption for the purpose of this article is that there is competition involved with any business. Even if you make your own, unique product, similar products will compete against yours. However, the existence of competition is not necessarily bad. The fact that online retailers are selling items similar or identical to your own means that there is demand for your product. Competition is only bad for you, as a retailer, when the market is becoming saturated (or is already at that point).
Check the electronics market for a good example of this principle. Electronics go for rock-bottom prices online because there are so many different stores that sell them. The difference in prices between stores usually comes down to the cost of shipping. The competition in this area is extreme. If retailers cut their prices any lower they won't make enough to survive.
The first person who had the idea to sell VCRs online probably made a killing. Nowadays, nobody makes anything more than a buck or two per unit. For a home-based business, that's not good enough. Today's electronics dealers depend on volume, and very good supply sources, in order to make their money. Generally speaking, small retailers cannot sell at those prices and turn a profit.
In order to be successful it is essential that you know what you're up against, and that means market research.
If you are selecting your products, then you need to know which stores already sell those products. You also need to know how many stores there are, how much they are charging and, if you can find out, how well they are doing. Could you sell for less (if only a little)? What are other ways you could differentiate your store from the rest?
If you already have your product, then you need to know where and how your competitors are advertising. Are they concentrated in one location? Are there good places that they have overlooked? How much is it going to cost to compete with them for prime ad space?
So, you may ask, where do I begin? The answer is Overture. Owned by Yahoo, Overture is one of the largest and most reliable pay-per-click advertising services. Their program can be an extremely effective, but that is something for another day.
What you need for research requires no sign-up and belongs to no program. There are two web tools in the Overture Advertiser Center that can be amazingly useful. The first is the Search Term Suggestion Tool. This tool allows you to look up a keyword, like "digital camera", and find out how many people searched for that term last month. Not only that, but the tool will suggest a list of related terms, like "digital camera review", for your consideration.
The number of searches per term comes from Overture's partners like Yahoo, MSN, AltaVista, CNN, etc. This is critical information because it tells you whether or not people are looking for your product online and, at the same time, shows you how they are searching for it. This indicates a certain demand for your product.
You may be able to judge the size of the demand, to a certain degree, by the number of searches for your terms. For example (numbers taken at time of writing and may not reflect current rates):
Digital Camera ? 1,337,422 (high interest)
Keep in mind that users searching for 'digital camera' are not necessarily shopping for one. They may just want information such as reviews or feature lists. It is also good to remember that if people are searching on Yahoo and MSN, as in the case of digital cameras, then you can safely assume that even more people are searching for the same things on Google.
The second tool Overture provides is the View Bids Tool. This tool allows you to take the keywords that you found with the term suggestion tool and see how many ads there are for each term and how high the bids are (in order to be listed on top of your competition you must place a higher bid for the term you want). This tool can help you judge your competition.
For example, at the time of this writing there are 131 ads associated with the term digital camera. The top bid is 79 cents per click. Bubble gum machine has 13 ads with a top bid of 49 cents. Chapstick Raspberry Vanilla, not surprisingly, has no bids on the term which means that the top spot could be purchased for the minimum price of 10 cents per click.
After you have your information from Overture, Google is your likely next step. To my knowledge, Google does not provide any analysis tools to the general public, though information is available to registered advertisers. Despite this limitation, it is easy to find your competition on Google. Simply enter your search term and check the right side of the results screen. The first page should show the top advertisers. Checking subsequent pages will reveal the entire list of advertisers for that term.
Tip: Sometimes advertisers may be targeting your term, but not selling your product. Read through the ads and visit the sites to get a more accurate idea of your direct competitors.
The natural results (the normal, non-ad results) of your search are important as well. Check those to see the top ranked sites in your market. Those sites are probably there because they employ search engine optimization (SEO) techniques. Users are much more likely to click on the natural results than they are the ads. The stores at the top of the list are likely to be well established and may represent some solid competition.
Visit your competitor's web sites and see what they are selling. Check for site quality, organization, ease of use and amount of products sold. Perhaps they sell your product, but it is lost in a vast sea of other related merchandise. That means better chances for your niche store. Maybe their site is ugly or hard to navigate. These are points at which you could gain an advantage over your rivals. Checking other sites will also give you ideas about how to run your own store.
The third step in this process is to check out Yahoo! Shopping. Yahoo! hosts what is known as an online mall. That is, retailers setup stores with Yahoo!'s services and are then included in Yahoo! Shopping's listings. This can be a good way to get fast traffic. For market research, it means easy access to competitor sites. On the Yahoo! Shopping main page, do a search for your product (Braun blenders for example). The results will show sponsored ads and normal listings. The sponsored ads come from Overture, so you should already be familiar with those.
The normal listings come from a combination of Yahoo! Product Submit results and Yahoo!'s web-crawler search database. What is important in this list is actually displayed just below the top sponsor listings and just above the normal listings. There should be two numbers: the number of products found and the number of stores they were found in. For 'Braun blenders' there were 989 matches from 76 stores (at time of writing). Those numbers give you an indication of how many stores you're up against.
Note: If there are too many matches, the number of stores will not be displayed (ex. 'sony dvd player' yields 3,660 matches). Of course, numbers that high shout, "big competition," even without store numbers.
Here again you have the opportunity to scope out competing stores. The thorough researcher would get their names and site locations. This may seem time consuming, and it is, but it will help with future research.
Our final recommendation is to visit eBay. Once there, find the eBay Stores area (located in the Specialty Sites box on the homepage at time of writing). Enter your search term to see how many eBay stores are selling your product. 'Braun blenders' shows ten items in eBay stores (not bad compared to Yahoo!). In addition, the search may show regular listings below the store results. These results should give you some idea of the popularity of your product as well as the feasibility of selling it on eBay.
Remember, some competition is good because it shows that there is an interest in your product. Too much competition is bad because it means low profitability. The spot where you can make good money is somewhere in between (most likely on the low end of the competition scale). Unfortunately, I know of no exact way to calculate your chances of success. For those who can afford it, hiring a market research professional might help considerably with that calculation. In any case, a solid business plan built on thorough market research will certainly boost your chances significantly.
About The Author
Jason Carr is a small business owner, dedicated student of e-commerce strategy, and producer of BeginBiz, an online resource for those looking to start an internet business.
6 Easy Ways to Increase Your Adsense Revenue
How much revenue do you generate from Google Adsense?
Creating Revenue Without Much Effort, Set It And Forget It Online
Earning more revenue from your website is the goal of most webmasters. However, this is time consuming and with so many things to do options are what you need.
AdSense - 7 Keys To Empire?
There's a lot of buzz around about how you can make a quick and easy fortune using this AdSense course or that tool or this book.
Adsense or Affiliate Programs?
As my sites get more and more search engine traffic, I am faced with trying to figure out how to best monetize my traffic. I am currently using mainly Google Adsense ads, but since I have added more affiliate programs to pages that are getting traffic I am noticing a very nice increase in my monthly income.
What You Need To Know About Googles New AdWords Affiliate Policy
A lot of affiliates are selling other people's products with AdWords. This has been known as easy money, since no website is required. All you need is a ClickBank ID and you have over 10.000 products to offer your visitors.
Pay-Per-Click Search Advertising Comes First
There are a variety of advertising options available to online business owners small and large. There's traditional banner advertising, text ads of both static and contextual varieties, popups and popunders, layer ads and pay-per- click search engine advertising.
How To Get Banned From Google Adsense In Just 2 Clicks
The darkest nightmare a hardworking affiliate webmaster fears is receiving a dreaded Google Adsense Warning, or even worse, a notice that Google Adsense has been disabled for the entire account.
3 Adsense Tips To Dramatically Increase CTR
Here are three Adsense Tips, together with the required HTML code, to dramatically increase CTRs and Google Adsense revenue.
Free Pay Per Click-PPC Search Engine Advertising
Did you know that there are actually pay per click search engines that will actually reward you with $10, $25, $50 or even $100 just for signing up for an account? That's right sign up for FREE and start advertising your site using pay per click search engines.
Surefire Google Adwords Formula
Success with Google Adwords isn't quite as easy as some would have you believe.
Make Free Money With Google
Have you received your check from Google? If you own a business web-site you should be receiving a check from Google. Why not accept a check every month from Google by placing their ads on your site?
7 Great Ways to Lose Your Shirt Using Google Adwords!
Google Adwords is a great tool! Careful use can lead to legions of highly targeted visitors breaching the moat around your site, and demanding to pillage your products! On the other hand...
Price Your ClickBank Products for Maximum Profit
Choosing the right price for your digital products is one of the most critical, yet difficult, aspects of your business strategy.
It Makes Sense to Add AdSense to Your Blog
Google AdSense is easy to install on a web page or blog and constitutes additional source of income without spending anything. You have to apply on-line for Google AdSense Program and generally approval comes from Google within two days. Those having AdWord account can use AdWord e-mail address and password for AdSense account also. After acceptance of application, Google confirms creation of your Adsense account thru e-mail. You get a code for AdSense text ads and another code for AdSense search. These codes are to be installed on web page or blog and within minutes the page will start displaying ads from Google, and a Google search bar. AdSense is available in dozen languages worldwide.
So You Want Big Profits From Your AdWords PPC Advertising Campaigns?
So You Want Big Profits From Your AdWords PPC Advertising? Everyone wants to make $300 a day or more with their AdWords campaigns. You've started a few campaigns, spent a few dollars, and now you're wondering - "where's the payoff!"
Google Adwords ? Manipulating Keywords For Success
As you probably know, Google Adwords is a pay-per-click solution offered by Google. As with other PPCs, you are given the ability to place your small advertisement on various platforms controlled by Google. While the platform provides you with a large audience, you must manipulate your keywords to generate success.
How to Use Pay Per Click Advertising to Increase Web Site Traffic
Have you ever imagined what it would be like to get hundreds, even thousands of targeted visitors to your web site each and everyday?
Keywords, How to Find Them, and Use Them Effectively
To be a successful affiliate marketer takes a ton of work. You probably know this by now. Really! I hear some of you say. You thought it was a piece of cake, mostly because you don't have to worry about having your own product.
AdWords Campaign Set Up Tips
It's easy to overlook the basics of a strong AdWords campaign. Without them though, your AdWords campaign can be doomed from the very start. Follow these tips and you can be sure that your campaign will have a strong foundation for both short term and immediate success.
Find Powerful Keyword Phrases in Five Easy Steps!
You may not realize it, but in the next few minutes you are going to learn one of the three most important steps to a successful pay-per-click campaign. That is, how do we find powerful keyword phrases in five easy steps? And the best of all, these steps are absolutely free!
|Home | Site Map|
|Copyright © 2005-2007 - Ðð©'§ pcMedix Computer Group Help Sites. All Rights Reserved.|