Small Business

Finding Your Online Audience


Today's column is the second in a two-part series about starting and running an online firm. The first column included an expert checklist covering some of the major tasks—and costs—involved in setting up an online business (see BusinessWeek.com, 9/1/06, "An Online Business for $3,000"). This time, we solicit expert advice for owners of existing online companies. Specifically, we asked how small firms can find their online audience.

For small businesses, nothing effectively aggregates valuable information and potential customers quite like the Internet. No matter how obscure the product or service your firm sells, there are likely to be places online where your competitors, and your would-be customers, are kicking back and talking shop. If you don't know where those places are, find them or create some yourself, says Peter Horan, CEO of the Bay Area-based AllBusiness.com.

"Let's say you're an online store selling fishing gear. You're an expert fisherman. You've got a great selection of flies and you can tell people about techniques and find products for them that they will never find at a chain sporting-goods store, or a Wal-Mart (WMT) or Costco (COST)," Horan says. "The big-box retailers have to operate in the fat part of the bell curve in order to get the economies of scale that work for them. That's why a small company has the opportunity to get into highly specialized market segments by selling niche products at higher prices."

KNOW YOUR NETWORK. The beauty of the Internet is that, while such specialized retailers often did not survive in offline formats with their inherently narrow, localized customer base and prohibitively expensive physical inventory, they thrive online where they can be visible to thousands of geographically far-flung customers via enthusiast Web sites, blogs, social networking groups, search engine listings, and ads.

While MySpace (NWS) and Friendster are perhaps the best known social networks online, Horan does not necessarily recommend that small businesses venture there, unless they are selling products with instant appeal to teens and young adults, the primary users (see BusinessWeek.com, 8/22/06, "Friendster: Poised for a Comeback").

"Those places are kind of like a teen party in the basement," Horan says. "If you blunder in and get it wrong, it's like the parents have come home. If you can figure a way to join the conversation without throwing a bucket of cold water on the party, that's fine. Otherwise, you'll be like Nike (NKE), which tried to sell shoes to skateboarders and got tossed out of the market four times because they didn't get the tone and manner right."

NICHE SITES. While many entertainment giants are jumping on the MySpace bandwagon to push their latest music and films, experts suggest that small online firms will have better luck creating, advertising with, and participating at, enthusiast sites, social cause networks, blogs, newsgroups, and e-mail lists that cater specifically to their customers.

"There's a site called Backpacking Light, out of Bozeman, Mont., that has done this just right," Horan says. "They've got an e-commerce section where they sell products. They've got a thriving community of enthusiasts. They've aggregated all the best editorial content, product reviews, and now they're even doing a small magazine. This is exactly how it works (see BusinessWeek.com, 8/7/06, "Who Wants $300 Hot Sauce?")."

When you find online niches where your company fits naturally, there's no reason to be hesitant about joining the community and making it aware of your products or services, as long as you do so gracefully and politely, focused on what you can add to the discussion rather than on making a sale, Horan says.

FEEL AT HOME. "Most of the abuses happen with advertising because companies are screaming for attention at an audience that largely doesn't care about them," Horan says. "If you're marketing to a general audience, only a small portion of them will be looking for your products. But when you find those hobbyist sites, or blogs devoted to causes, the audience is already there, listening and looking for your point of view. You'll never need to shout because you've got an active audience that's ready to talk with you."

Finding your audience will take some time, but requires no specialized tools and little money. Start by entering your industry and product keywords on Google and other major and specialized search engines. Follow the links that show up, bookmark the interesting ones, and lurk until you've got a feel for the community.

Do the same thing at Technorati, which searches blogs. Then look through the newsgroups sponsored by sites like Google and Yahoo for communities that might be discussing issues related to your products or services.

KEEP UP TO DATE. Additional possibilities are sites that feature consumer business referrals and advice. Places like Judy's Book and Insider Pages solicit reviews of local businesses and services from consumers, who visit the sites looking for "advice on who's the best plumber in Seattle, where to find a good window washer in Chicago, and where to find the best Chinese food in Boston," says Andy Sack, CEO of Judy's Book, which is based in Seattle.

"There are many ways for small businesses to tap into online communities like ours to find new customers for free," he notes. Start by searching for your business name to find out where it appears on the site (even offline firms may be listed). Next, make sure all of your contact information is correct. "Judy's Book allows small-business owners to update their contact information and add sales descriptions to their listings," Sack says.

Registered local merchants can also publish their latest deals and coupons. To really get the most out of these sites, read the reviews written by people who have had a personal experience with your firm. Find out what people are saying about your business and take the time to respond to both positive and negative comments. "Use this as an opportunity to further engage with new and existing customers," Sack advises.


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