By: Bob Arnson
Abstract: Selling online is mandatory. The question is, which way is best? By Bob Arnson.
Selling online is mandatory. The question is which way is best.
It's safe to say now that if you have products to sell, it's just plain dumb
not to sell them online. 10+ million
Amazon.com customers can't be wrong, right? With Web sites serving as marketing
and advertising vehicles, forcing a late-night browser/potential customer to
wait until normal business hours to order is like sticking up a big sign that
says "GO AWAY - WE DON'T WANT YOUR MONEY." That's a bad message to
Right now, there are a variety of ways to offer products for sale online
short of hosting your own e-commerce servers and real-time payment processing.
Many companies have already gone to that trouble, so why re-invent the wheel?
The easiest is to just collect customer and payment information automatically
and process the sale manually. Many Internet service providers offer
e-commerce packages that include Web-site hosting, catalogs, SSL encryption, and
transaction reporting for low cost as part of your monthly ISP charges. Most
even offer store builders
that create the necessary HTML pages for you.
Though this method is simple -- Web orders come in like phone and mail orders
and can be processed as part of a daily routine -- its disadvantages are
Immediacy is a big part of the appeal e-commerce has for so many online
buyers. Processing transactions offline loses that immediacy.
Shareware and other try-before-you-buy software led to a number of companies
offering online registration services. These registration services are
especially useful for very small ISVs that don't or can't handle credit cards
themselves or for small ISVs who want to reach a world-wide audience.
Registration services are generally catalog-like: You direct customers to their
site when it's time to pay -- that's the one service they provide, so you don't
tend to have much control over the appearance of the pages the user sees.
Registration services tend to batch
payments received over a period of time, so you might receive a check every
month for your registrations, minus processing fees
and other charges.
Registration services work best for software that is electronically distributed
and licensed via serial numbers or codes;
most registration services handle everything involved in an all-online
Yesterday, Amazon.com announced
its plans to offer hosting of e-commerce sites, joining other big names like
Yahoo (and Viaweb, which Yahoo acquired
last summer) and Digital
River in offering similar services. Basically, they work like this: You
build your Web site however you want to; when it comes time for the user to
click the "Buy me" button, you point them toward your e-commerce site
on your "store host." The store host provides the typical e-commerce
site functions like catalogs, a shopping cart, and most importantly, credit-card
billing and the management and customer service that come with it. (Yes, I'm
oversimplifying -- some store hosts let you host
your entire Web site from their servers, for example.)
Borland's getting into the act too. Our
very own developer community offers online
shopping and is now taking applications
from third-party vendors to sell their products online as well.
Such online malls offer a more seamless approach to online selling, but it is
usually clear that the company handling the money isn't your company. But that
might be an advantage. If you're a small ISV, would a new customer feel better
about handing credit-card information over to you or a more familiar name like
Borland or Amazon.com?
Talk about digital
cash is usually about micropayments,
being able to easily and quickly authorize small transactions that aren't
cost-effective with the current overhead of credit cards. But digital cash isn't
limited to such transactions. If digital cash catches on in sufficient numbers,
it should provide a convenient way for even the smallest ISVs to offer
personalized e-commerce. I know, too many conditionals in that sentence. Digital
cash clearly isn't an option until more people use it. But in this increasingly
wireless world, something's bound to replace plastic cards with magnetic strips
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