Jassen: And the single best place for someone to start is Ebay, right?
James: Yeah, I think you asked me that at the end of another call, right?
Jassen: Right.
James: You said, ‘If you had only one place to start where would you go’…
Jassen: Right.
James: …and I said ‘I’d go to Ebay’.
Jassen: Now, could you, you know, for this call could you reiterate why Ebay?
James: I don’t think I remember the reason why. Here’s basically the reason, you already have a huge pool of ready buyers they going to Ebay to look to buy something.
Jassen: Exactly.
James: And that’s where they’re going, right?
Jassen: Ebay has over 60 million registered users.
James: Okay, and that’s huge.
Jassen: Huge!
James: So, now you go to Ebay and for literally pennies, forty of them…
Jassen: Right.
James: …you can go there and try to do one item for sale for less than ten dollars and if it gets bid up higher than that then you can get a lot more than that…
Jassen: Right.
James: …but, you can go and test stuff easily, quickly and see people that are interested in that and then you can sub-categorize into specific categories on Ebay where people who are interested in those types of items are looking already.
Jassen: That’s right, so the beauty of places likes Ebay and Amazon and other online storefronts and stuff like that is extremely low cost to put something up…
James: Yeah.
Jassen: I like the fact that there are literally millions of people that are already going there on a daily basis.
James: Yeah.
Jassen: They can see items.
James: You don’t have to go and generate traffic to a website store.
Jassen: You don’t have to do extra marketing.
James: Right.
Jassen: That’s really what it comes down to.
James: You’re basically paying them a marketing fee.
Jassen: Right and the third aspect of that that I like is they take care of all the payment stuff for you.
James: Well, if you use PayPal on Ebay, yeah, and Amazon has their own payment system and Google Base has its own so, yeah you’re right they do have their own payment systems that they kind of recommend to people. I mean, you can get your own merchant account and do all that stuff, which we talk about, but you don’t need to. On a lot of these systems, like Ebay, PayPal is integrated with Ebay because they own it, they bought them…
Jassen: Right. Yep.
James: …and so, almost the overwhelming percentage of people on there use PayPal.
Jassen: Yeah, you know, it’s just like on Amazon they have, you know, the Amazon Market Place?
James: Right.
Jassen: Well, there’s also Amazon Payments, which is their payment system. It’s integrated on Google, you’ve got Froogle, which is Google’s online shopping place and then there’s Google Check Out.
James: Yep.
Jassen: As a seller you can integrate the two.
James: Yeah.
Jassen: And so you don’t have to have your own merchant account, you don’t need to worry about credit card processing and, you know, and gateway access and all this techy stuff.
James: Yeah, and we cover that on another CD, so if you are interested in that you can get that information, but you don’t need it is what we’re trying to tell you.
Jassen: That’s exactly right.
James: You can get setup very quickly without having to worry about, you know, paying $500.00 plus $60.00 a month for your merchant account. You can go to PayPal and accept payments where people can pay PayPal via Mastercard, Visa, American Express, Discover, all those different ones…
Jassen: Right.
James: …and then you just get paid in your account and then you can transfer it to your bank account.
Jassen: Exactly.
James: The same thing with Amazon, and Google check outs and all these other guys.
Jassen: Yeah, and you know, as far as where to post we’ve already kind of been putting out there the list…
James: What is the list, formally, tell us?
Jassen: Yes, lets formalize the list and this is kind of ranked in my opinion, in order, okay?
James: Okay. In order of what, where people should get started, or…
Jassen: Yes.
James: Okay.
Jassen: Just in terms of I don’t think I really have any scientific basis for this…
James: Okay.
Jassen: …it’s just based on experience I’ve had from working with you and what I’ve heard from other people.
James: Okay. I’ll tell you if it’s true to my experience you just say the list.
Jassen: Okay, so here’s my list, number one place to start is Ebay.
James: Okay, I would agree with that.
Jassen: For reasons that we’ve already discussed, it’s cheap, there’s already millions of people that go there every day looking to buy.
James: Yeah.
Jassen: Number two, in my opinion is Amazon because for really the same reasons and, you know, if you’re going to become a volume seller on Amazon, you can save yourself money by joining what’s called their Pro Merchant Program.
James: Yeah, you know, Ebay is great, I mean, with one niche I make several thousand dollars a month on Ebay.
Jassen: Yes you do.
James: Now, on Amazon, the nice thing about those guys is you pay a flat fee and you can list as many items as you want.
Jassen: Right, now Amazon does have several different programs and if you already have an Amazon account from buying stuff, then you also can sell stuff, but they take a huge chunk, I think it’s fifty, fifty-five percent, something like that of what you make.
James: Okay.
Jassen: But, if you have a Pro Merchant account they’re commissions are a lot lower.
James: Okay.
Jassen: For example, on books, CD’s, DVD’s , stuff like that…
James: Now that’s what we use, right?
Jassen: Right, that’s the category we use.
James: Okay.
Jassen: It’s, you know, for example if somebody bought this particular CD off of one of our Amazon listings, we pay the fifteen percent commission to Amazon.
James: So, it’s fifteen percent of whatever it’s sold for plus we get a portion amount of that shipping, right?
Jassen: Correct, they credit us a portion of the shipping, I think it’s a little over half.
James: Okay.
Jassen: So, that keeps your fees down, however; the program is $40.00 currently and we’re recording this is March of 2007, currently it’s $40.00 a month to have a Amazon Pro Merchant account.
James: Now, they have some intro rate for the first month or two, right?
Jassen: They do. Right now they’re running a special where its twenty bucks for the first two months.
James: Okay, now you have to look at your numbers, if you’re selling one item, well, forty dollars a month might not be good for you.
Jassen: Exactly.
James: If you’re selling five hundred items, it might well be very good for you.
Jassen: Exactly, well, the breakpoint, if you do not have a Pro Merchant account, they also charge you a .99 transaction fee…
James: So, if you’re selling more than forty items, you know that’s the way to go.
Jassen: Bingo!
James: Okay. So, that’s the rule of thumb…
Jassen: Right.
James: …if you’re selling more than forty items a month on Amazon, then you should get a Pro Merchant Account.
Jassen: Correct.
James: And I would even suggest that if you’re selling, you know, less than forty because the commission difference is there too.
Jassen: The commission difference is huge.
James: So, I mean, if you’re doing anywhere near forty automatically upgrade.
Jassen: Exactly. Next, Yahoo stores.
James: Okay.
Jassen: You know, based on some of the data that we’ve looked at, it seems that Yahoo stores do get a little bit less traffic then say Ebay and Amazon.
James: Yeah, those are definitely the two big ones.
Jassen: They are, they’re kind of like the 800 pound gorillas, so to speak…
James: Okay.
Jassen: …in their particular market places, but you know, people do make a lot of money on Yahoo stores.
James: Yeah, you know, I had a Yahoo store one time, I actually have my own system now through another company, but I used to have a Yahoo store and there was a time when I was basically waiting to close it down, okay?
Jassen: Okay.
James: So, I wasn’t promoting it, I wasn’t sending any traffic there and every time I was just about to close it down, I’d get another sale. So, I’d be like ‘ok, I’ll let it go another month and we’ll see if it goes…’ and it just kept going like that and finally I was like ‘this is ridiculous’ I’m doing like one, two, three sales at a time I’m going to close it down and focus on something else.
Jassen: Right, but it was paying for itself, right?
James: Yes it was.
Jassen: Okay. Other places, Froogle, Google’s shopping service and you put items into Froogle via their Google Base service.
James: Yeah, I’ve been playing around with this recently, it’s kind of nice.
Jassen: Yeah, it is. There’s a lot of things, for example, that Google Base supports that places like Amazon and Ebay don’t and to me the biggest benefit to it is you immediately get indexed in the Google search engine.
James: Yeah, immediately, a couple of days.
Jassen: Well, yes. And with their Google check out service, you also have that integrative payment solution.
James: Yeah, and for right now, I think, for all of 2007, they are still offering it free.
Jassen: Yes, through December 31st of 2007, and of course they can change this at any time, but they are currently offering it with no transaction fees.
James: Yeah, so you’re not even paying a percentage when it sells, it’s free to put up, it’s free to sell and so that’s actually a pretty good model. You know, I read an article, I think you sent it to me last night…
Jassen: Yeah.
James: …about a guy doing over a million dollars a year on Google Base.
Jassen: Yes, and the reason that’s incredible is for two reasons, one he’s selling power tools.
James: Okay.
Jassen: Which, you know, that’s a niche.
James: Yeah.
Jassen: A very incredible niche and it’s a niche where, according to the article anyway, where conversion rates are typically pretty low.
James: Okay.
Jassen: …is what the article is saying. The other incredible thing about that is, that in terms of , you know the current acceptability in the current usage and kind of the brand recognition and what not of Google Base.
James: Yeah.
Jassen: It’s really not there.
James: Yeah. Nobody, I mean, I knew of it, but I never knew that people were using it to sell things and until probably two weeks ago.
Jassen: For me it was probably four days ago.
James: Okay, maybe it was sooner than that.
Jassen: I mean, I knew it existed, but I really didn’t know what it was.
James: Okay.
Jassen: But, Google Base is a way to, you know, Google kind of has this thing, they want to I say, archive the world.
James: Yeah.
Jassen: And, you know, Google Base is place to store, you know, everything from product reviews to recipes and what not, but a lot of people don’t realize that they could use it for marketing.
James: That’s right.
Jassen: And it’s not kind of, you know, if you want to do marketing specifically on Craigs List, for example, you’ve got to be careful about how you do it in order to not violate their terms of service.
James: That’s right, because its community it’s not designed to be commercialized.
Jassen: Exactly. Now, you can do promotional stuff on CraigsList, but you really have to watch yourself.
James: Yeah.
Jassen: Where as Google Base…
James: It’s commercialized.
Jassen: …it’s commercialized and they fully admit it and welcome it.
James: It’s intended to put products up for sale.
Jassen: Exactly.
James: That’s what the whole Google Base product section is all about and that’s why Google check out integrates with it easily.
Jassen: Exactly.
James: Yeah.
Jassen: So, you know, if for somebody that has absolutely not a dime to their name they can still do this.
James: You mean you could do it if it’s free?
Jassen: Yes, and you know…
James: Could you afford free?
Jassen: I can!
James: It’s totally free to sell on Google Base, including the commission on the sales, they’ll process credit cards for you and they’ll just deposit it into your bank, there’s no charge.
Jassen: Yeah, it’s a smaller marketplace by far, but you don’t even have to cough up the forty cents that you do on Ebay.
James: Exactly, so you go on there, start selling some things, start making a little bit of money and then you can move to Ebay if you want to. I mean, if I had a little bit of money, and it doesn’t need to be a lot, like ten bucks, twenty bucks…
Jassen: Yep.
James: …you can go and start on Ebay and Ebay will go and even finance it for you , they are going to bill you in 30 days.
Jassen: Yeah, well, like on Amazon, you’ve got to pay for your Pro Merchant Account ahead of time.
James: Yeah, where if you don’t pay the Pro Merchant fee they’ll still finance you and they’ll only make you pay when you sell something.
Jassen: Right, so, you know, Ebay and Amazon and Google Base are really the places to start.
James: Yeah. Okay good, well that was the formalized list.
Jassen: That was the formalized list and you know we’ve spent half the call covering these first two steps because they really are the two that really get you going.
James: Now, don’t you have enough information at this point to really get started? You pick your niche, you go put your products up, we told you where to put the products up.
Jassen: Right.
Until my next post,
James
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Jassen: Step two is actually setting up shop.
James: Yeah.
Jassen: So, you know what you want to sell, your next thing is to actually sell it.
James: Right.
Jassen: And, you know, a lot of people think that there’s a huge gap between setting up shop and actually selling something, you know, after you decide you want to start selling stuff online or any kind of business.
James: Give me like a time gap.
Jassen: Yea, well a time gap, a knowledge gap, a learning curve, whatever you want to call it.
James: Right.
Jassen: But, really, there’s not.
James: Okay.
Jassen: You know, a lot of the gurus out there that teach a lot of this stuff, you know, very similar stuff to what we’re teaching, but a lot of them at least… I’ve spent a lot of money on courses and what not and I know you have too…
James: Yeah.
Jassen: …but…
James: I’ve got a huge library.
Jassen: Yeah, you do, but a lot of these guys they make it sound complicated, in my opinion.
James: Okay.
Jassen: Some of them do a better job than others, but there are some of them out there that really make it sound complicated and in order to really understand it you have to buy a bigger package or something like that, right?
James: I see where you’re going with this, yeah, I mean in my opinion, you should get set up and learn real time from having real life experience.
Jassen: Exactly.
James: So, you know, go out there and start something that’s relatively inexpensive, you know, go start posting stuff to Ebay, to Amazon, or create a Yahoo store or Google base or CraigsList, and actually start having some different items up for sale and you’ll learn what works and what doesn’t work. It’s like trial by fire.
Jassen: Exactly.
James: Yeah.
Jassen: So, and that’s what step two is all about.
James: Okay.
Jassen: You’ve decided you want to sell something. Well, once you’ve decided that you want to sell a certain niche product or service, the very next step, literally the very next minute, if you’re at a computer with an internet connection, you can be starting to actually do it.
James: I would agree.
Jassen: So…
James: And inexpensively is the main point there.
Jassen: Yes. Yes.
James: It’s not going to cost you $500.00 to test something like this.
Jassen: No.
James: I mean, what does it cost in order to put up an ad on Ebay?
Jassen: Twenty cents.
James: I think it’s a little more than that. I think twenty cents might be the ninety-nine cent price.
Jassen: Well, if you’re selling a ninety-nine cent or less item, you know, if you’re selling something that’s more than ten to twenty something dollars…
James: Less than ten dollars I believe right now, it’s less than forty cents listing.
Jassen: Okay.
James: Okay, so for the cost for one of the dollar menu items you can test two items on Ebay.
Jassen: That’s right. Now, some people might think you’ve got to set up a web site, you’ve got to set up, you know, a transaction system and we do cover that kind of stuff on other audio CDs in the series.
James: Yeah, we’ve got a whole hour on that.
Jassen: Yeah.
James: But, the summary of that CD is, you don’t need it.
Jassen: No, that’s exactly it; you don’t need to spend thousands of dollars building a web site. You don’t even need a web hosting account.
James: Yeah, we talk about this at length on that CD, but the idea is there are places out there that you can go without a website. Ebay’s an example, Amazon’s another example, Google Base is another example, CraigsList is another example. All these different places, you don’t even need a website.
Jassen: And you know what I really like about that model?
James: What’s that?
Jassen: Is that you are literally, you are combining your sales model, your platform, you’re combining that with marketing.
James: Yeah.
Jassen: And what I mean by that is that when you build a website, you have to drive traffic to the website.
James: Yeah, and you’re going to where the traffic is when you go to those venues.
Jassen: Exactly.
James: Yeah.
Until my next post,
James
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James: Yeah, let me make one extra point here.
Jassen: Okay.
James: It just occurred to me about niches when we finalized this and that is don’t be afraid to step on your own toes.
Jassen: Oh yes.
James: And what I mean by that is, if you’ve got overlapping niches…
Jassen: Right.
James: …okay? For instance, you’re serving, you know, an industry where you’ve got one group of people and then another group of people and some of those people are shared…
Jassen: Right.
James: …they overlap, they go back between, you can still put out both of them and have overlap. You’re cannibalizing business from yourself.
Jassen: Yes.
James: Yea, go ahead.
Jassen: Yea, you know, some people will say, ‘Oh, but you can’t do that because it hurts you’. Well, wouldn’t you rather steal business from yourself, but still get the business rather than have someone else come in and fill that niche and take that business from you entirely?
James: I agree. Now, here’s the one way I like to explain this is, lets say you’re in a relatively small town and you own a McDonalds…
Jassen: Right.
James: …or any type of fast food it doesn’t matter, let’s say you own a McDonalds and you want to now expand. Well, why not open a Burger King?
Jassen: Right.
James: I mean, people might not like McDonalds they might like Burger King or, you know, they’re going to go and they’re going to decide to go to go out for fast food one night and they can either go to Burger King or McDonalds, who cares where they go.
Jassen: Right.
James: So, you go do that and then maybe you want to open a McDonalds on the south side of town then open another McDonalds on the north side of town…
Jassen: Right.
James: So, there’s no reason not to open multiple niches that have overlap.
Jassen: Right. You know, as long as theirs a market that, you know, as long as the market is big enough to support, you know, that Burger King or the second McDonalds…
James: Yes.
Jassen: …in your example, there’s no reason not to do it.
James: Yeah, and you know what the great thing about these online businesses is the cost in order to open something up and test it is so small. It’s not like, you know, a $200,000.00 franchise fee…
Jassen: Right.
James: …or one of these big fast food places. I mean, you could go, it’s almost cheaper to open up the business and see what sells than it is to do market testing to see if it would sell.
Jassen: Exactly. Well, why don’t you ease into step two?
James: Okay.
Jassen: I love how you do these segues. You always time them perfectly.
James: Awesome.
Until my next post,
James
P.S. Check out Online Business Setup Step By Step or our free downloads.
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Jassen: It is, so, I guess, here’s the first question. Could you offer up a good… Your definition is better than mine, and it’s shorter, could you offer a definition of what a niche is?
James: A niche is a category or a sub-category of a particular type of item or group of items that you’re focusing on selling. As an example, and you can break things down into all sorts of niches, but you could focus on, you know, if you were looking at the automobile industry, so you can go and focus on American made cars or you can say your niche is only Ford cars or your niche is only sports cars, or maybe your niche is only red cars, or black cars, maybe your niche is four wheel drive cars. So, you can take all these different areas and sub-group it up into different markets and focus that as a particular niche.
Jassen: Okay.
James: Does that help?
Jassen: Yeah, now, once somebody has selected a niche, just because they’ve selected a niche, say they want to get really specific, like red 1970’s Ford sports cars, you know, that is an incredibly specific niche.
James: Do you want to talk about why you should niche?
Jassen: That’s where I’m heading with this.
James: Okay, good.
Jassen: Once they’ve selected a niche, here’s the beauty of it, you can, it goes with being the whole, people may have heard this phrase, being a big fish in a small pond…
James: That’s right.
Jassen: …so, when you have a very specific niche like that you can really target yourself to a target market that is really interested in that particular niche.
James: Yeah.
Jassen: And, even thought there may not be a huge market for that particular incredibly, detailed and refined niche, chances are that it is quite possibly a very underserved market.
James: Absolutely. Let me give you an example so I kind of understand this, okay? We’ve got a few medical doctors in my family and so if they put out there shingle to work and it said medical doctor, okay, you’re not just going to get people coming in off the street that need brain surgery or someone that’s got a broken arm or someone that’s got, you know, that is pregnant and they’re actually looking for prenatal care. So, you’re not just going to go and put out medical doctor and expect people to come in. You want to specialize and advertise. Now, they may have duel specialties, they may be able to deal with sports injuries and they may be able to deal with family medicine, you know, general health, check-up, that type stuff, but they may want to advertise and say ‘Family Medicine Check-Ups’ or ‘Physicals’ or they may have another one, ‘Sports Injury Specialist’ and then they put out these specialized niche marketing things and then people interested in that will come to them.
Jassen: Right.
James: If they just put out medical doctor you just get anyone off the street you don’t know who you’re marketing to. The same is true about different types of businesses.
Jassen: Now, let me ask you, James…
James: Yeah.
Jassen: …Once you’re in a niche…
James: Yep.
Jassen: …are you stuck doing only that one niche?
James: No. No, that’s a good point. Here’s what I was just going to use as another example, lets say you were teaching marketing, kind of like what we have with these CD’s…
Jassen: Right.
James: …well, you could go and have generalized marketing information, I mean, there’s only so many different things you could talk about, like Google Adwords, or direct mail, or all these different things, but that once you learn the basics, then you can go and adapt it to all these different industries. So, we could teach marketing to doctors, we could teach marketing to chiropractors, we could teach marketing to small business owners and you could break those down into lots and lots of sub-categories themselves and you could actually market to dentists and you could market to doctors and do both simultaneously and one marketing that you’re putting out to dentists makes it seem like your only specialty is for dentists and your other advertising you’re putting out to doctors makes you seem like your only specialty is doctors. Neither group knows that you service both, they don’t need to know, but you can then go and sub-niche out.
Jassen: Right.
James: Same is true with this business, once you learn these basic principles you can get involved in anything you want and the also sub-divide out to other groups and run parallel business models.
Jassen: That’s right, and you know, there’s nothing wrong with doing that.
James: No, I encourage people to, because what happens if one market dries up? Lets say you were involved in Beanie Babies five years ago…
Jassen: Right.
James: …or ten years ago, whenever they were really, really hot…
Jassen: Right.
James: …and you were like, “Oh, I’m making a six figure income just on Beanie Babies alone”.
Jassen: Yep.
James: Well, if you didn’t go out and sub-specialize and actually expand out to different markets, and the Beanie Market’s tanking, it’s going down, and there’s no way you could make, you know, six figures a year now doing Beanie Babies because they’re just off their peak, if you didn’t go and group out and do parallel business models, you’d be hurting. And so, if you go out there now and you say “Okay, I’m going to have five, ten, fifteen, twenty, different sub-niches where there’s similar type models, but now I can go and service these different industries using similar resources.” You have duplication of resources so you have some efficiency there…
Jassen: Right.
James: …and then you can go out and you can do this.
Jassen: That’s right.
James: Yeah.
Jassen: So, you know, I would encourage people, you know, if they have an interest in a particular niche, you know, start thinking about how there are side niches that might be a comparable market…
James: Yes.
Jassen: …and, you know, if, you know, just because somebody’s interested in, you know, say, you know, using your Beanie Baby example, those are, in my mind those are stuffed animals…
James: That’s true.
Jassen: …and so, you know, there’s a lot of different types of stuffed animals, you know, that you can branch out into, but there’s also other things that maybe you want to take a step up and go to, you know, the category that encompasses stuffed animals. I don’t know what that would be, maybe children’s toys?
James: Yeah, I mean, you could go and go up a niche you could go down a niche, you can go sideways, you could go, you know, you could go anywhere you want that you feel comfortable. If you’ve got three hobbies, you’ve got three good places to start.
Jassen: That’s right, that’s right, and I would encourage people that once they kind of understand how the first one goes, and this is something you’re big into, is once you understand how something works, there’s no reason why you can’t replicate it for other products, other services, other niches and kind of build it.
James: I agree.
Jassen: Okay. So, you know, that’s what I wanted to cover on this first step of this whole step by step process.
Until my next post,
James
P.S. Check out Online Business Setup Step By Step or our free downloads.
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