This quote appeared on one of the jewelry forums I follow.

Hi I ordered a custom (ring) from …. and last contact with him was Sept. 21 stating payment recieved will be in touch soon….It’s been almost a month now and I have sent a few emails to him with no response. Anyone have any ideas how I should proceed…all I want is an update with an estimation of completion…I feel funny to email him again I don’t want him to think I’m some kind of crazy stalker…hehehe….Just worried the ring won’t be here in time for my wedding which is Nov. 12.

This lady simply wants some reassurance that her ring will be ready for one of the biggest days of her life. We later found out that the jeweler was having some personal issues, which happen, but a 1 minute email would have gone a long way toward assuring his customer that she would be taken care of. In the mean time this thread went on for more than 3 weeks with his reputation being heavily damaged in the process.

Sticking his head in the sand and pretending that there wasn’t a problem didn’t make the problem go away.

Closely related to this is a company that answers it’s email when they get around to it. This is probably the single biggest problem I hear from our customers at Images Jewelers. Most people will send out several requests for more information about having a piece of handcrafted jewelry made to several jewelers. We constantly hear about how fast we are to respond, or how they had emailed someone else a couple weeks ago and never heard from them, or the best ones, when we are nearly finished creating the piece and the other jeweler has finally responded to the first request for information.

The number of jobs we land simply because we answered our email quickly at close to 10% of our total sales. It’s such an easy way to increase conversions but so few people really put an effort in to their email support that it continues to surprise me.

And then we have people like the folks at Fatheadz.

I had bought a pair of sunglasses from them and after about one month they exploded in to 4 or 5 pieces. They weren’t terribly expensive, about $100, but I had never seen an injection molded piece explode like that. So I sent their customer service an email letting them know what happened and what we could do about it.

About 30 minutes later I got an email from them apologizing for the problem and a solution. Send them the sunglasses back and pick any pair that I wanted from their website to replace them. No hassles, no questions, just an immediate response to the problem with a solution.

So many companies drop the ball when it comes to the basic things like responding to email in a timely manner. It shouldn’t be that way. Not every company can afford to have someone dedicated to answering email the instant it comes in, even if the answer is a yes, we got your email but I need to ask a few people to get an answer for you.

Make answering your email a part of your daily routine. And not once a day, several times a day. Do it first thing in the morning, immediately after lunch, and again about an hour before you go home for the day. Do it and watch your conversion and retention rate jump dramatically.

And for the record, I love my new Fatheadz Sunglasses!

So, what did I fail at? A couple people knew that this was coming, but I bet that most haven’t noticed that this blog is now running on a new domain name and under a new operating name. Yup, I picked a business name without doing enough research, I let myself make an assumption that could have potentially turned in to wee bit ‘o drama in the future.

The name I had originally chosen was Large Orange Pop. I have a thing for the 50s even though I was born in the 60s, and the idea of looking for a name that had more potential as a brand than as a description of some services I may offer appealed to me. It appealed to me so much that I simply assumed that I was the only one to think of it. As usual, assumptions can go wrong. There is another company out there that had a similar idea, Orange Soda, only they had it several years ago.

So what’s a guy to do? The obvious, move on quickly and put it behind me. I found a new name that I like that also lends itself toward branding, and when I finally have the time to work on it, a new look and feel featuring my favorite 50s villains and heroes, robots. Hopefully the rebuild won’t take too long, but fortunately I am heavy with client work at the moment that may keep me from working on my own site.

Takeaway?

Do your research! You may have a great idea that you think is completely unique, but odds are you would be wrong.

Normally I stay “at” the casino because I don’t really gamble all that much and love the ease of going up to the room and catching a nap. But the only rooms available were $350/night.. I’m not exactly cheap, but $350/night for a casino room? I can go to Vegas for that much money. So the quest was on to find a nice place to stay, for a fair price, close to New Buffalo. Who knew that it would be such a challenge?

If you are running just about anything in New Buffalo local search is wide open for you. It took far too long to find a nice bed and breakfast reasonably close to the casino, well, not really, but if it weren’t for the new maps in Google we would have never found the place we wound up staying. Sans Souci Euro Inn and Cottages (yeah, it’s their title and it’s on every page). Angie and Sue run an amazing little operation on 50 acres with a small private lake just full of fish. It’s quiet, it’s well furnished, it’s 3 miles from the casino, and it’s incredibly reasonably priced. We already have reservations for a full week later in the summer.

So what’s the point of this long post? Am I just trying to rub in the fact that I found a great place to stay? Well, yeah, sorta. But more importantly it’s about how few people are taking advantage of promoting their local business on the internet. And more specifically, on Google. A simple search for new buffalo michigan bed and breakfast on Google returns just 85,000 results, and barring the map, and just “one” real bed and breakfast, ranked #7. There is a B&B that is closed, it even says so on their website, that ranks #5. If it weren’t for the fact that Angie is looking to retire I’d offer to rebuild her site for her. I may still make an offer, but it might be to just buy the place and change careers!

While looking for something to do other than the casino I did a search for charter fishing new buffalo michigan. Not a single charter boat based in New Buffalo has a tag on the Google local map. Not one. Any SEO in New Buffalo Michigan may want to take a drive around the docks and look for a few new clients. Or maybe not, I may be up there in August fishing and could use the work.

To recap,

• Casino getaway = great!
• Quiet B&B to relax at = fabulous!
• Have a website for a business and not taking advantage of local search = epic fail

Enter Revolution Money Exchange. Based in St. Petersburg, FL, RevolutionMoneyExchange is actually using accounts issued by a real bank with real rules! First Bank & Trust, Brookings, SD, is a real bank, a member of the FDIC, and is part of the Fishback Financial Corporation.

RevolutionMoneyExchange isn’t some basement operation either. Started by Steve Case, co-founder of AOL, it has received venture capital funding from Citi, Morgan Stanley, and Deutsche Bank.

Just to make their startup spectacular RevolutionMoneyExchange is giving everyone that signs up between now and April 15th gets $25, FREE! It also sends me $10 for the affiliate code used in these links, so please, use my affiliate code. Even if you don’t use my code, sign up, take the free money. And let’s start putting the hurt on PayPal. Maybe this will spur them in to adopting some real oversight. But I doubt it.

Maybe I’m wired wrong, but every time I see that PSA the only thing running through my head is, how is that poor salesman supposed to feed his kids? As a bit of marketing it does seem to grab your attention, but it does a terrible job at actually providing a solution. Buy me, don’t buy me, why should I want this? It doesn’t trigger a call to action response like it should.

Americans have been notorious for not saving money over the last couple of decades, the current economic issues lend a lot of support to this. The me economy of get it now pay for it later has hurt a lot of people. People that should have known better. If you make $30,000 a year you should not be buying a $600,000 house no matter how much you want it. The same can be said for many businesses out there.

Everyone wants to be the next Blue Nile or Amazon. And they seem to approach it from one of two directions.

1. They open up their wallets, dig a hole, and start filling the hole until they get what they think they want. This approach never works because you are competing with other companies with bigger wallets, bigger holes, and are just as crazy as you are.

2. They hire little Jimmy, their golf buddies high school kid that “builds web sites” for $10 an hour and then wonder why the world isn’t beating a path to their door.

Just like the Feed The Pig PSA’s, there never really seems to be a good plan in place for getting where they want to be, a stable economy with financially responsible people helping it recover. They have an idea, think it’s a great idea, and charge full speed ahead without taking the time to really think over their options and possible solutions and problems that the plan can introduce. The problem with the Feed the Pig commercials is that they say “Don’t spend money” without explaining why, or how to be more financially responsible. There is no plan, no solution, just a dressed up pig.

There is another commercial out there where the family decides to buy a new TV and you see the husband looking at the mega screen plasma super TVs, yet when they get home they have a reasonably sized TV that we assume they can afford comfortably. Reasoned and responsible spending.

What about your web site? Has it be reasoned out? Is there a plan, a goal, a solution? Or is it just a dressed up pig and you are hoping that your viewers “get it”??

Some of them are a tribute to an age of business and marketing that has long since passed, while others are simply a tribute to the egos of the people behind them. In either case there is something about them makes me smile. The same smile when watching a teenager at the mall walk in to a glass door while trying to look cool for some girl.

When it comes to anthems most people know about the IBM song from the 50s Ever Onward but not as many know that people are still making these things. I’m not why, but someone at Salesforce.Com decided that making a music video about the Dev Life was a good idea. Take a look at some of my collection and laugh. I hope to be adding to it soon.

Corporate Anthems

Some of my favorite shows are Danny Sullivan’s Daily Searchcast, Strike Point with Dave Naylor (DaveN) and Mikkel deMib (Mikkel), and SEO 101 with Carolyn Shelby (cshel), Brian Mark and David Brown (Ne0).

You can listen to the live stream for free, and even some of the not so old episodes for free, but to get to all of the back issue stuff, and it is worth reading, you need to sign up.. Hence the affiliate link here. Of course you can go there for free, but hey, momma needs new shoes so a little affiliate love for a good resource shouldn’t be too painful, should it? Go give Webmaster Radio a listen, you are bound to learn something.

This really starts hitting home as the economy starts to become tight and there is less discretionary spending going on, especially in luxury markets like jewelry. I pick on jewelry a lot for several reasons.

• It’s a market near and dear to my heart
• It’s an industry full of artists rather than business people
• Jewelers are notorious for undervaluing their skills and services
• The vast majority of jewelers think that competing on price is the only way to succeed

So why am I making a big deal of this right now? Simple, a good online jewelry retailer has gone bankrupt in the past week. Bella Jewelry was a great low price jewelry retailer with a large customer base and an extremely vocal core of repeat customers. By all estimates they were a multi million dollar a year operation. And in just a few months have gone from living the good life, or at least being profitable, to completely bankrupt.

How is it possible to go from millions of dollars in sales to flat busted in a few months? Simple, they forgot the #1 rule of business on the internet, it’s still business.
How to lose it all in a few months

There are hundreds of ways to kill a business fast. But like everything else online, killing a business online happens at internet speed and if you aren’t on top of everything, it can be gone before you recognize the problems. So what killed Bella Jewelry? I don’t know for sure, but I can make a lot of very educated guesses based on what I know of the industry and looking at their business model over the last several years as a competitor.
Outside influences

The biggest outside influence in the jewelry business right now is metal prices. Gold, platinum, even palladium and silver are setting new highs for price. In one year gold went from $641.80 an ounce to a high of $1002.80 an ounce. Platinum went from $1225.00 to $2252.00 and palladium from $317.00 to $579.00. When your number one material for your product is seeing a nearly double price increase in a short amount of time you have got to be on top of your retail pricing.

Many eCommerce people get so busy “working” that they forget to keep an eye on their prices. Especially when you are a drop shipper reselling someone else’s product. Your supplier raises his prices and you fail to keep up by raising your prices. The supplier isn’t likely to give you that old price just because you forgot to update your website. If you are running thousands of SKUs it can be even worse. I know of one jeweler that has eliminated an entire category of product simply because it takes too much time to keep the prices current.

By the way, if you make osCommerce and ZenCart modules you might want to consider developing an easy price change module. I know a lot of people that could really use one.
Earning a profit

The biggest mistake I see online is people thinking that the only way to compete is to be the cheapest guy out there. Being the cheapest may get you sales, but one small mistake can cost you everything you have worked to build.

The diamond trade has been all but turned into Taco Bell with what we refer to as pajama retailers, guys selling diamonds that have never actually held a diamond in their hands, selling diamonds for 4% to 6% markup and happy to get the “easy money”. The small local music store wiped out by no margin websites like Amazon.Com and so many more. It has created a wave of online marketers that feel that to compete online they must sell things at as near to their cost as possible. While this may initially be a great thing for the consumer, over time it leaves you without that expertise in any given industry to sell and support a product and leaves you with a call center in India reading from a script or a guy in his pajamas with no clue about what he is selling, but can tell you how he ranked #1 for it on Google and developed a fabulous affiliate program.

Bella Jewelry’s problem is that they went after the eBay crowd with a new retail product. To sell in that market their margins were in the 10% and lower range. That’s “gross” margin. Out of $1 million in sales that leaves just $100,000 to pay for overhead like labor and returns.
Customer service that puts you out of business

I am one of the biggest advocates of treating your customers like the most important resource on the planet. Without them you have nothing. But like children, you can still love them and support them while enforcing strict rules.

Stores like Wal-Mart have created this sense of entitlement with shoppers that I don’t think is deserved, or even healthy. Walk in to any Wal-Mart and they will gladly exchange anything you have for cash or another product, no questions asked. That’s great for a store with thousands of locations and a very healthy 24.2% gross profit margin, it’s not so great for a single store operation with a 10% gross margin. Even with a 24% profit margin Wal-Mart’s net profit, the important number, is just 3.2%.

What happens when you run an online jewelry store with a 10% gross profit margin, an open return policy of 45 days, no questions asked, and no restocking fee? You go bankrupt in 60 days or less.
The numbers

Let’s make a few assumptions.

• $1 million in retail sales for December
• 10% gross profit margin
• a no return policy from your vendors on any modified product
• all of your products are modified
• 35% return rate in January and February (based on what I have learned from talking to people close to the subject)

This gives you $100,000 in gross dollars to refund $350,000 in returned merchandise that you can not return to your vendors for cash or credit. You just paid $250,000 to let your customers “borrow” your product for the holidays. I don’t know about you, but I don’t think I could stay in business very long if I had to pay my customers a quarter of a million dollars every 45 days.
Fallout

Unfortunately it doesn’t stop there. To have the product to sell you had to borrow the $900,000 in merchandise to sell it for $1,000,000. You had $100,000 to pay your staff, rent, buy food and maybe see a movie on Tuesday at the dollar cinema.

That $100,000 vanishes first leaving you no money to pay any of that overhead. And, it also leaves you owing your supplier $250,000 for product he has already sent to you leaving him possibly unable to pay his staff and suppliers. So it’s not just you who suffers. Every bankruptcy affects people several degrees away from you, not just you and your customers.
The solution

#1. Charge a “fair” price. There will always be someone willing to sell it cheaper than you so don’t let yourself be drawn in to that fight. Find the price that you need to charge to stay profitable and also able to survive the unforeseen.

You may think that your customers will never pay you a 25% to 100% markup on your product, but these are the same people paying 1000% markup on a bottle of water. Charge it, ask a fair price, and provide outstanding service.

#2. Keep a close eye on the cost of your supplies. When your business model involves buying off the shelf items for resale you have got to have a sharp eye for trends in pricing so that you can stay ahead of the curve and not catch yourself selling at a loss just because you forgot to update your prices.

#3. Add a restocking fee to your terms of service. You don’t have to actually charge it, but put it in there. This will do two things for you.

1. It keeps the “borrowers” from using your store as a way to borrow things for a month and then send it back. You may think this isn’t happening, but there is a thriving sub-group of consumers that look for long return policies to be able to borrow things for that company party or holiday season only to return it to you when they no longer need it. Why not, it doesn’t cost them anything.I heard one story of a woman that bought a large air conditioner in August during the peak summer heat, only to return it in early October because the merchant had a 90 day return policy and it wasn’t hot out any more.
2. You can be a hero for those rare “real” returns when you tell your customer how sorry you are about the problem they are having and you are waving the 20% restocking fee. You’ve instantly taken what could be a negative experience for your customer and turned it in to a positive one by making them special.

Internet business is still business, your rent just happens to be $50/mo for hosting rather than $12/sq foot for a retail space in the mall.

Or maybe not.

Without a doubt the web has become a very crowded place. With almost every commercial business having at least some presence online, some businesses having multiple websites, and then the top of the heap, the megalithic websites like Amazon, Blue Nile, and eBay. We won’t even get in to the topic of affiliate programs that create hundreds, even thousands, of websites all selling the same product. With that level of competition why would anyone want to get involved with adding a second business to their already full plate?

Why do I need a website?

For me, the number one reason for a company, especially a small company, to have a website today is that fewer and fewer people are using the phone book to find what they are looking for. When someone picks up a phone book they are looking for a phone number. They already know what they want, pizza, movie times, how late are you open, and other similar questions. As people become more and more internet savvy they want more than a phone book can give them, they want to shop.

But what if you offer a product or service that has seen its market eaten up by outsourcing overseas like software development, or turned in to a commodity sold from lists in a database rather than as an actual product like diamonds? You can still compete. It’s been said by the people at Wal-Mart that you can’t out Amazon Amazon, but you can find an angle where you can compete on a local level, and as you grow in to your web presence you can begin to expand in to larger markets, or new products that will help differentiate you from the Amazon’s and Blue Nile’s of the world. And if you can pick up a piece of the global market on your way up, that’s just a little more icing on the cake.

Local Search to the rescue!

The easiest and usually best way to start elbowing your way in to internet millions is to stake out your local market. There may be thousands of people online selling Peeps but how many people are selling Peeps in Flathead County, Montana? I don’t know about you, but when I get a craving for pink bunny peeps I need them now, not 3 days from now via FedEx.

It doesn’t have to be Peeps. Maybe you run a small printing company, or you have a baseball card shop, or even a tanning salon. Whatever it is, the internet makes for the best phone book ad ever. It has everything a normal phone book ad has, phone number, address, etc., but it can also have your store hours, a list of products or services, maybe even an interactive way for your local clients to get what they need without even getting in their car.

So what do we do now?

The first step is to build a website that not only focuses on your product or service, but one that focuses on your local community. A site that is just as likely to rank well for your city’s name is it is to rank for your product.

Fortunately for both of us I have just signed up a new old client. I originally built their first website more than 7 years ago, and since it was built it has seen almost no effort put in to it. A common problem for small businesses with a lot of work to do and not enough time to think about that “web thing”. As long as the email works, they are happy. I’ll let you in on who this client is in a few weeks once we get things back on track for them.

I can tell you that they are in a very competitive industry that has seen it’s profit margins eaten away by advancing technology and cheaper labor costs in Asia. But it is still an industry that can, and should, have strong ties with the local community and should leverage that involvement in to a profitable website that serves as more than just a place to get their email from. We’ll find out together if it can be turned around and made in to a profit center rather than an expense.

The client side:

No one wants to see their competitors gain an equal footing with them. So having your Internet Marketing company help your nearest competitor may not be very high on your list of things you would like to hear about. After all, your marketing company’s goal is to help you rank just as high as your website can, and how can they do that if they are helping someone else to the same thing?

The marketing side:

As marketers we spend a lot of time and resources developing contacts, relationships, and knowledge about very specific markets. To the point where it is not uncommon to see companies specialize in very specific niches. This goes for web developers, advertising companies, architects and auto mechanics. Specializing breeds excellence in a very narrow category. Having more than one client in a specific industry can be seen as a very good thing.

The non-compete:

Non-competes are generally thought of when dealing with an employer / employee relationship. But can also apply in a contractor situation. Basically it is a clause in a contract, you do work with contracts don’t you?, that defines who the contractor can work with and in what areas they can work when their actions may compete with the primary client.

What to do?

You can either take additional work in the same field or not. But how do you decide which is the right option for you? When we were doing software development we actually had a tiered pricing structure that I think may be appropriate in this situation.

Our clients had three options:

1. Open development. The clients paid a set fee and the work belonged to us and they simply licensed the end product.
2. Non-compete. The client paid a higher fee and we developed the software for them and did not sell it to other potential clients.
3. Total ownership. The client owned the software, the source code, and were allowed to do anything at all that they wanted to do with the finished product. And, of course, this was the most expensive option and rarely used.

There is no reason that an SEO company can’t build on this same model. Especially one focusing on local search. Offer your potential client the option, up front, to lock you in as their SEO and internet marketing company to the exclusion of all others, for a fair price. This protects them from having to contend with a new company coming in and climbing the rankings right behind them and it allows the marketing company the opportunity to receive a higher billable rate in compensation for reducing it’s potential client base.

Be pro-active on this subject. Approach your clients and let them know that they have the opportunity to lock you in and guarantee that your specialized services will be dedicated solely to them. And for the businesses out there, if you are concerned about your marketing company helping someone else in your market, call them, see what you can do to tie them to your company exclusively.

Non-competes aren’t for everyone, but you need to decide what your response will be before you are placed in the position of having to decide whether or not to turn down offers of new work.