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ONLINE BUSINESS

David vs. Goliath: Four Lessons

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David Schwartz, proprietor of the Mabel'sMusic and Card Shop Web site, has carved out a successful business selling CDs and playingcards online, despite the fact that he has a much lower profile than the Goliath in thismarket - CDnow. David's success holds lessons forjust about every would-be online entrepreneur.

Lesson #1: Pick a niche you know
Based in Old Greenwich, Conn., Schwartz started Mabel's Music Shop three years ago because he was staying at home with his infant son and needed a way to make money. He also had a deep passion for music - and for his Aunt Mabel, who had instilled a lifelong love of music in him. "In the early '70s," Schwartz recalls, "we went to see George Winston play guitar in this little coffee shop. We were the only ones there. I'd never heard Hawaiian music before."

How do you know there's a niche online? Check around for content sites that speak to particular interests. One excellent indication of a niche opportunity is finding lots of noncommercial sites about a specific topic - ice fishing or tarot cards, as examples - but few or no commercial sites catering to that interest yet.

How can you be sure your passion for the niche is strong enough? Schwartz would like to keep running his site even if he had all the money in the world. That's one sure sign.

Lesson #2: Save money and keep it simple
Schwartz's site itself "is cut and paste. It's pretty basic," he says. "The site is easy to look at and quick to load." Indeed, it promises "No Ads, No Java, No Banners! No Junk mail!" The minimal loading time greatly pleases customers. Remember: for a site that sells, looking lovely is a luxury. Keeping your selling message clear and uncluttered is vital.

Lesson #3: Add value wherever you can
"We sell stuff CDnow will never have," Schwartz says, "as well as stuff you can get from them. But when I buy, I go straight to the artist, because distributorsonly know the dollars and cents. They can't give information about the artist or the music." Schwartz's site offers hard-to-find information about artists, as well as their hard-to-find CDs - that keeps customers loyal.

Running a business online also "saves me the cost of mailing the catalogue to thousands of people," Schwartz says. "It's a wonderful way to build a catalogue. And since all my stuff's in stock, I can ship pretty quickly." He says most of his business, "about half," comes from the Web site, with a quartermail order and another quarter telephone.

Lesson #4: Don't force people to order online
Schwartz offers this vital bit of advice: put an 800 number on your site, in large, bold type.

"Having the telephone is essential," Schwartz says. "It's all about marketing. People are reluctant to give credit card numbers over the Web.There's the perception that it's not safe." This in itself spawns an entire industry in expensive secure Web sites and encryption technology, says Schwartz, laughingthat "I sound like one of those Kennedy conspiracy theorists, but that's all it is. They need a way to sell you more equipment. Because let's face it, the rent on the Internet is pretty low."

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Last updated: Dec 15, 1999




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