by: BL Ochman

This morning I passed a store in my neighborhood that has been struggling along, trying to develop as a business for about two years. It was dark and empty with two signs in the window. One was the usual “For Rent,” and the other was a banner that said, “Shop Us On the Web at http://www.ourstore.com.”

But here’s the saddest part of the story: If they couldn’t make it in bricks and mortar, they’re most likely to fail in clicks.

Their problem was that the owners could never decide exactly what they were selling. The shop, which had no advertising or promotions budget at all, contained a mix of candles, herbs, cosmetics, candy, lingerie and pocketbooks. Huh? So how in the world are the same goods on a web site suddenly going to attract huge crowds and sales?

Scarily Similar to the Gold Rush

Thanks to Amazon, Bigstep, and hordes more sellers of instant-store dreams, hundreds of thousands of people are seeing their chance to get in on the Internet boom. Amazon’s site virtually yells, “Selling is easy. Find out how to open your own store today!” And millions of would-be desktop retailers are going to learn what bricks-and-mortar store owners keep learning the hard way: It’s not enough to open your doors and wait to be overrun with customers.

For starters, being one of several thousand stores in an online mall is not unlike opening a store on the third floor of a building along the least-traveled road on the outskirts of town. Online or off, the best and most successful retailers know that a combination of quality goods, top-notch service, innovative displays, ambience and a sense of theatre are what appeal to customers. It takes some skill to get the people walking by to come into a store, and even more to get them to buy.

The world’s best traditional retailers make an effort to make shopping fun and to fill the experience with a surprise in every corner, hoping to make customers say “Wow!” Succeeding in online retail is going to require equally customer-focused principles. However, desktop merchants aren’t going to have the benefit of walk-in traffic unless they can afford to try attracting shoppers with a lot of expensive advertising.

The online malls are the modern-day equivalent of the Wizard of Oz. Some even promise to supply your products if you have none of your own. And they claim they can deliver traffic -- probably better defined as warm bodies holding credit cards. Despite today’s new technology, online merchants without a great business plan, a unique selling proposition, and substantial cash for advertising and promotion ought not to give up their day jobs too soon.

Promises, Promises…

Iconomy.com bragged to The Wall Street Journal, “We have relationships with 150 wholesale distributors. We have access to 3.5 million products. We can get a store together in a matter of two to four weeks.” Iconomy provides such services for its merchants as store design, merchandise procurement, order processing and customer service, and takes a split of sales. Of course, they have nothing to lose, since would-be retailer millionaires pay an up-front and a monthly fee for their webfront stores.

So don’t just follow the yellow brick road to Oz, because here’s the bottom line: Amazon, Iconomy, et al. have found the goose that will lay the golden online egg. Great plan -- for them.