Sunday, January 14, 2007

E-commerce goes up in '06, grows up in '07

posted by Andy Leff
Great news for small businesses everywhere: 2006 featured double digit growth in the e-commerce field -- over $102 billion for the year.

Can't get better than that, right? Oh wait. It can. Analysts are projecting an additional 20 percent increase in '07.

Key reasons for this growth:

* increasing adoption of broadband
* lower prices in online channels
* increased convenience of online shopping

This makes it the perfect time for businesses to get online and get connected to one another -- and to advertisers -- before they miss the bus on an incredibly lucrative market opportunity. Yet not enough businesses are there, deterred by the perception that e-commerce infrastructure is expensive, or that identity thieves will ravage their customer base.

Both excuses are ungrounded. Yes, it can be expensive to get online, especially for a smaller business. Web-site setup alone can cost thousands of dollars. But look at the ultimate purpose: to source new business. This makes a $2,000 investment upfront well worth it down the road, especially if the business focuses on search engine optimization, networking, and community contacts.

And don't get me started on credit cards. I blame media hype for the cloud of fear over identity theft and fraud. When people go into a clothing store at the mall and steal a jacket, do you hear about that? No. Why? Because someone stealing a jacket does not sell newspapers, magazines, or prime-time news coverage on network TV. Online crime does.

As a result, business owners' perception of identity theft is relative -- not absolute -- and should not deter online business. Besides, new stringent security protocols in place at many e-commerce and advertising sites make shopping there safer than handing your credit card to the cashier at 7-11.

If you want your business to grow, take the 'new school' approach: technology. Doing it 'old school' -- brick and mortar stores, cash-only transactions, etc. -- will help your competition.

It's easy to implement, too. Call your local Chamber of Commerce, and ask if they offer any Internet service provider deals. Check with the Better Business Bureau to find a reputable Web developer who fits your budget. And keep an eye on local initiatives: Many cities, Philadelphia among them, are announcing municipal Wi-Fi initiatives that extend free and reduced prices for community-wide Internet.

Sooner or later, everyone will join the 21st-century party. Don't let your business arrive fashionably late -- especially when it doesn't have to.

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