42 replies to this topic

[rolf]

Do you have any ideas short of, "Read this or you will die"?

I like it, direct and to the point!!

But seriously, maybe something like 'Paypal, easy and secure...' or maybe 'About Paypal's secure payments' - just a couple of suggestions, although I know there's some talented wordsmiths around here who could probably come up with something killer.

[arlen]

IMO If you can not afford to invest $30 to $50 a month in your business, you should simply close up shop.

LOL, now that's a little harsh don't you think? I've heard others say stuff like this, and no offense, but I really think this is an elitist attitude and pretty dismissive and insensitive ... you don't necessarily know the financial situation of your audience. Someone else could just as easily say "If you can not afford to invest $3000 to $5000 a month in your business, you should simply close up shop." All about perspective.

I started my biz after I got laid off and was having a rough time finding paying work locally. Everyone wants your money, and websites can be a large expense until you learn how to drive traffic ... most any startup is paying far beyond $30 to $50/mo on other things related to business, that's money that could be used on advertising, inventory, etc. Heck, that's money that could be used for food or paying your rent or mortgage. Saving even $10 a month IF it doesn't hurt conversions is a worthwhile consideration to many a startup ... especially if you don't have much income coming in the door from other sources.

Having said that, I agree $30 to $50 a month is worth doing in this case as I think it will likely help conversions substantially, IF you have enough traffic to make sales.

Edited by arlen, 19 October 2006 - 12:24 PM.

[Hex]

I havent read all this thread because Im lazy but from my experience heres the scoop

I have been knocking up ecommerce sites for about 8 years now, paypal is not seen as being as professional as "proper" sites that take credit cards. I know that world pay offer a combined internet merchant account and payment gateway and there will be others out there that do too and maybe better value too.

Paypal doesnt require that you have an account to buy but it does restrict people from buying in some instances. I had a paypal account anyhow, I logged into it with a Brazilian proxy (I just forgot to turn it off) and it was suspended, I was unable to then pay people using paypal even if I used the option for people with no account as they would not deal with me, I now have 6 paypal accounts just to spite them, 2 of them verified using their "secure" system......

[waveshoppe]

IMO If you can not afford to invest $30 to $50 a month in your business, you should simply close up shop.

LOL,

now that's a little harsh don't you think

? I've heard others say stuff like this, and no offense, but I really think this is an elitist attitude and pretty dismissive and insensitive ... you don't necessarily know the financial situation of your audience. Someone else could just as easily say "If you can not afford to invest $3000 to $5000 a month in your business, you should simply close up shop." All about perspective.

I started my biz after I got laid off and was having a rough time finding paying work locally. Everyone wants your money, and websites can be a large expense until you learn how to drive traffic ... most any startup is paying far beyond $30 to $50/mo on other things related to business, that's money that could be used on advertising, inventory, etc. Heck, that's money that could be used for food or paying your rent or mortgage. Saving even $10 a month IF it doesn't hurt conversions is a worthwhile consideration to many a startup ... especially if you don't have much income coming in the door from other sources.

Having said that, I agree $30 to $50 a month is worth doing in this case as I think it will likely help conversions substantially, IF you have enough traffic to make sales.

Harsh, not really as long as you can distinguish between a hobby and a business. Traffic is pretty overrated; you can have a boatload of traffic, but if you cant convert them to a sale what the point?

Seems to me that many want the financial rewards that come from owning a business without the financial commitments.

[arlen]

OFFTOPIC:

Don't mean to drag this thread further off topic, nor do I intend to pick a fight, but ... Seems to me that many want the financial rewards that come from owning a business without the financial commitments. OK, sure, I'll grant you that. But I'm certainly conscious of expenses, and I'd imagine you are too. If judged strictly on my end of year profit, many 'business people' would consider my site nothing but a hobby, even with several thousand dollars invested in inventory, regular monthly business expenses, etc. Who is it that stands as judge and jury as to what qualifies as a legit business, who sets the criteria? I currently use a similar cart as you do, so I mean no offense by these comments. I pay twice monthly what you do, does that give me justification to judge you as less of a business person that I am? I don't think so. I accept credit cards directly, as far as I can tell you use exclusively PayPal, can I use this to judge you as nothing but a hobby site? I wouldn't. Can the fact the neither of us host our own carts be used by others to dismiss us as not legit? Not in my opinion. I'm switching to a self-hosted solution because I can offer more to my customers, I know more, and feel it's affecting my conversions negatively. So by your logic, once that's done, I can put myself above you as you aren't willing to make the financial commitment I am ... doesn't seem sound logic to me. Many businesses start out as hobbies. Most new business people have limited resources. The next big thing may be someone's hobby right now.

[waveshoppe]

My posts are aimed at post #5 “So please, everyone, let me know if you have an opinion based on experience.” I think “what qualifies as a legit business” can be easily determined, if you research state and local county records for business licenses and they are listed, they are a business.

That does not mean they are competent or financially secure nor have a big inventory. Nonetheless they still qualify as a business.

[harpsound]

Our website is mostly service oriented as a gigging harpist.
People that hire us expect to see CDs for sale.
So we sell them onsite to match the perception.
The ROI per transaction for time/resources used is low.
We have developed an incredibly efficient administration with low overheads.

Having sold over 5000 CDs off stage we know our CD buyer really well.
Older women over 40 who are severely technologically challenged with an inner-self-seeking perspective.
It goes with the harp shtick to hate the technical issues around eCommerce.

To make sales on the web 7 years ago we had to accept cheques as any credit card transaction was taboo to this group due to security fears.
We developed a system of mailing unpaid-for CDs worldwide based only on an email request from the buyer and the cheque would dribble in a couple of weeks later.
At that time we averaged about 2-5 sales a week.
We have had 100% payment over the years.

We added a simple Paypal option secondarily to the cheque option about 4 years ago where we emailed a URL (with a button on the page) in our invoice AFTER we had shipped the CD(s).
Again the you can trust us because we trust you factor.
Uptake of Paypal was about 5-10% of the transactions at that time.

With the Walmartisation/commodification of music our sales dropped to almost nil 3 years ago.

Starting this year our sales have been steadily rising with about 75-85% taking the Paypal option voluntarily even though the cheque option was being promoted more.

So last month I removed the cheque option from our websites' blurbs and have secondarily shown the cheque option only on the email invoice sent after shipping.

So far no one has used the cheque option at all and sales of continued to grow.

From our contacts with the buyers, the profile is the same but they are feeling more secure with online transactions in general.
Some use the credit card only Paypal transactions but I think most are registering with Paypal.

I believe we are witnessing a demographic change where the most conservative are becoming literate and less fearful about credit card/Paypal use on the web.

Granted we work the you can trust us factor to a very high degree but there is still a seed change.

We now operate an honesty system where harpists download sheet music as .PDF print-outs and we ask them to pay into a Paypal linked "Honesty Box". We got our first check for USD$6 after a 4 month trickle of USD$3-$20 Paypal payments.

The most super-conservative are starting to accept online payment.
For are part we are enjoying the honesty systems as the administration time costs are low and the cost of securing every dollar with technology simply defeats the profit motive.

We are Canadian based and have fewer merchant options too.

Stephen V

[waveshoppe]

Addendum to a previous post: I will still stand behind what I stated but I really hope people don’t take solicited opinions as a personal attack. You have to evaluate and test you’re markets and customers to see what works for YOU, but after you crossed that threshold from toying around to making a commitment you need to be able to say that your business is at least worth investing 50 bucks a month.

I think paypal basic is great for the early stages, some webs need more, some don’t, and some feel compelled to over engineer everything.

For the record, we have a web that simply blows away our shirt company (financially) and it don’t even have a shopping cart. Fact is that we do not even advertise, not one penny is spent on marketing.

[alan]

Hi Everyone!

Lots of opinions here, which is great! The more opinions, the more one can draw a consensus. So thank you very much to everyone for your opinions.

It makes a lot of sense: If you can't afford $50.00 a month, you shouldn't be in business. And if that was the entire story, I would agree with you completely.

Of course, it's more than $50.00 a month, because you have to add the expense of the shopping cart. And maybe that's another $50.00 a month. And maybe there are programming costs if it's beyond the site owner's capability, etc.

So $50.00 a month can easily turn into $100.00 - $150.00 in recurring fees. And this is on top of the other costs of being in business.

In my case two business licenses; a CD/DVD duplicator $1,500.00; professional editing fees for videos (big money); inventory (several thousand dollars) some additional computer equipment, various new software programs; a bunch of money spent on professional copywriting services that didn't increase sales any more than my home grown copy; stabs at PPC, etc., etc., etc.

As a matter of fact, this shoe string business has cost me over $2000.00 per month every month since this past June when I retired from professional practice to focus on being an Internet entrepeneur. So saving even $50 a month right now if I'm not positive that it will help sales sounds pretty good to me.

I suspect that PayPal is scaring off some customers. But unless I make a commitment to spend a lot of time and a bunch of money to get a real e-commerce solution, I won't know. And right now I can't afford to take any more gambles unless I am totally convinced that the deck is stacked in my favor.

As far as being in it for the long haul, well - I've been in the hypnosis racket since 1978, and I would not have spent all of the money, or the 20 hours a day I've devoted to Internet commerce, if I wasn't committed. Come to think of it, maybe I should be committed!

I hope that additional people will add their opinions - especially those that have been gained either from PayPal, or by converting from PayPal to a regular shopping cart.

[waveshoppe]

Hi Everyone!

Lots of opinions here, which is great! The more opinions, the more one can draw a consensus. So thank you very much to everyone for your opinions.

It makes a lot of sense: If you can't afford $50.00 a month, you shouldn't be in business.  And if that was the entire story, I would agree with you completely.

Of course, it's more than $50.00 a month, because you have to add the expense of the shopping cart. And maybe that's another $50.00 a month. And maybe there are programming costs if it's beyond the site owner's capability, etc.

So $50.00 a month can easily turn into $100.00 - $150.00 in recurring fees. And this is on top of the other costs of being in business.

In my case two business licenses; a CD/DVD duplicator $1,500.00; professional editing fees for videos (big money); inventory (several thousand dollars) some additional computer equipment, various new software programs; a bunch of money spent on professional copywriting services that didn't increase sales any more than my home grown copy; stabs at PPC, etc., etc., etc.

As a matter of fact, this shoe string business has cost me over $2000.00 per month every month since this past June when I retired from professional practice to focus on being an Internet entrepeneur. So saving even $50 a month right now if I'm not positive that it will help sales sounds pretty good to me.

I suspect that PayPal is scaring off some customers. But unless I make a commitment to spend a lot of time and a bunch of money to get a real e-commerce solution, I won't know. And right now I can't afford to take any more gambles unless I am totally convinced that the deck is stacked in my favor.

As far as being in it for the long haul, well -

I've been in the hypnosis racket since 1978

, and I would not have spent all of the money, or the 20 hours a day I've devoted to Internet commerce, if I wasn't committed. Come to think of it, maybe I should be committed!

I hope that additional people will add their opinions - especially those that have been gained either from PayPal, or by converting from PayPal to a regular shopping cart.

Please forgive me for this: Why then don’t you just use the power of hypnosis on them?

[Randy]

We've discussed this in another older thread or two around here somewhere Alan, and it may or may not directly relate to your question. But probably relates to your main one.

<Edit to add>
I found a recent thread on the same general subject. In a post of mine a ways down the page I link to the older post I had in mind from way back when. Both may be worth a read to give you some more ideas.
</Edit>

When I was first starting out with my own sites I used one of the 3rd party merchant account things. Paypal wasn't an option at the time because it required signup for anyone to pay through it. 2Checkout.com was the 3rd party service I used to be exact.

I did it because it was a really inexpensive initial fee --I think around $50 at the time though this was few years ago. There was also not going to be any additional programming fees because they offered a way to tie a link right into their own shopping cart. Now most of them also offer some type of cart you can install on your own site I think.

I knew after awhile that this choice was costing me money. Not so much in sales because of friction in the sales process, but in that 2CO charged more per transaction and a higher percentage than I was seeing being offered if I had my own merchant account.

I sent off queries to a few merchant account providers, and there weren't nearly as many then, to get the real bottom line costs if I decided to go that route. Both start-up and on-going monthly costs.

For my first site --a service site so no inventory overhead-- with my price point I came up with a figure where the monthly per transaction and percentage someelse kept vs. what I got was break-even. For my sites the figure was $3,000 in gross sales.

Once my first little site got to this level and stayed at or over it for a few months I took the plunge, figuring that the start-up costs that weren't all that much anyway were just a short-term cost of doing business and that a few months down the road I'd be ahead of the game. From there I never looked back.

Just as an FYI, my Merchant Account goes through Authorize.net. They have all sorts of scripts available you can plug right into your purchasing form if you already have something set up that works for you. No need necessarily to introduce a shopping cart into the picture. Most of these services do offer scripts or help to get you up and going.

Does this mean I don't offer Paypal as an option anymore? Of course not. I still offer it, even though a purchase through Paypal sends me a little less money per sale because of their fees.

In fact, since then I've added the ability to pay via check online with a little $80 package I bought. It basically lets them enter their checking account data (security of this data is going to be your biggest concern) which you can then use with the software to print out a draft against their account.

And I also still allow people to pay by mailing a check or money order payment.

Heck, on some of my service sites that cater to certain markets, namely schools, I even accept Purchase Orders where they get immediate access even though I know going in I'm not going be paid for a month or more.

The bottom line is you really need to sort out what works best for your potential customers. Then give them that option, or more than likely those options. In the long run it's really the only way to have a decent chance at maximizing your income while not doing any great amount of extra work.

[OldWelshGuy]

OFFTOPIC:

Diolch, you've got me there though. Did you say "No problem Little"? It's no problem? or something of the like? I'm Dutch, all the Welsh I know is from sign posts. (Dim ..., Araf etc)

Sorry Bach technically does mean 'little' but it is also an accepted abbreviation of Bachgen (boy, male) it is an affectionate term for friend. so Dim Problem bach, means no problem my friend!

[alan]

Please forgive me for this: Why then don’t you just use the power of hypnosis on them?

You are forgiven!!

I would just hypnotize everyone on the web to send me money, but that wouldn't be sporting.

[lyn]

We are Canadian based and have fewer merchant options too.

Since you're in Canada, you at least have the advantage of offering Interac E-mail payment to virtually anyone with a bank account!
My wife has been promoting it big time for her business -- talk about no-muss, no fuss! She gets the order, they send the Interac e-mail, the cash is in her account, in minutes!

Just one of the benefits of being driven by a banking oligopoly.

L.

[harpsound]

I would love to do interac and some day will.
For gigs!
What is the penetration of online banking?
My target client will be a very late adopter on average.
Either stuffy corporate or little old lady.

<beginning of rant>

I do find it difficult with technophiles that say get with it or get lost.
Our little service site feeds a family of 4.
It just does not sell "stuff".
Spending an extra $1200 a year ain't going to make it so, either.
Anything that exists in the digital realm makes it's previous media/carrier obsolete.
I can be a monopolist with the media but the digital file is duplicated ad infinitum without the same aforementioned media.

One must look very carefully at the intrinsic value of a music file as an example.
It will not be found behind a shopping cart.
The whole entertainment industry faces this conundrum.
Audio Recording
Publishing
Newspapers
movies
It is not that they are hobbyists - it is simply the old physical paradigm just does not work.

Bit by bit I am seeing whole industries being ported into a computer and away from a physical universe where you can patent, control, sell and monopolise.

Shopping carts are not going to change that.
<end of rant>

Paypal works as a low risk option in an environment where there is little leverage.

S