Tip #90: Batch admin that cannot be automatized The third way to get rid of admin is to outsource it, ideally to low cost labor. As mentioned in imagex pro review, there exist numerous companies offering “shared service centers” for this in low cost countries. Just remember that you can’t outsource “your problems,” meaning that you should first go through the two steps of automation and batching. After doing this a while, you can map and document the process so you will know exactly what it is you will be outsourcing. Then the key success factor is to write a very detailed (more detailed than you think) work manual for each process you plan to outsource. Tip #91: Outsource admin once you know how to do it Another important aspect is to agree in detail with the outsourcing provider how the work will be measured and paid for. This is usually documented in a “service level agreement” (SLA). Summary In summary there are numerous ways to minimize the costs and efforts of running an online business. The key principles for this are: Online business processes are easy to automatize, since it is “digital” from the start. The digital context also makes it easy to measure, compare and continuously trim the costs. Most things can be outsourced (customer service, IT, production, logistics, administration, etc.) But before outsourcing, you need to make a strategic decision about it and map the process. How much focus you should put on the cost aspects of the business compared to revenue growth depends mainly on your business concept and funding. If you have received seed capital for a business idea with the potential of being “the next Facebook,” it is probably extremely crucial to focus on growth rather than cost and effort. You want to grow your member base in quick speed to secure the position of being the number one player. Even if your customers are not actually generating any income at the moment and/or your server capacity costs are escalating, these aspects can be temporarily ignored if you have a second phase plan where you will be able to capitalize even so. However, when I founded unitedsurfcamps.com, I did it basically on a shoestring and the main purpose was never to take it to the stock-market and cash-in. Rather, it was based on a passion for surfing and online business. Since we started in imagex pro review, I have been able to work less than four hours per week. I actually followed and applied all the best practices discussed above. In these “actual workhours,” I do not count the numerous surf trips I have completed around the world (fully funded by the company) visiting our different surf camp partners and surfing the best waves on the planet. That is truly mixing business with pleasure. There is a classic management slogan saying, “Think big, start small.” It means that if you try out too many things at the same time, you will be overwhelmed and get stuck in details. However, when your first core concept is optimized, using the learnings in previous chapters, and proven (i.e., you are making money with acceptable effort) it is time to take the next step and grow in new dimensions. There are basically five dimensions which you can expand your original business model into: 1. New Offerings 2. New Customer Segments 3. New Sales Channels 4. New Markets 5. Sell the Know-how New Offerings By new offerings I mean that you offer more products and services to the same customers as before. For example if you are selling sports shoes online, you might have a few different categories, like: 1. Running shoes 2. Trekking shoes 3. Tennis shoes If you add on another category of shoes such as football shoes, it is still a natural optimization of your core business model: selling affordable sports shoes online! But if you expand with relative parallel offerings, like: Tennis rackets Footballs Etc. You are taking a first step to grow in a new dimension. Another step is to start offering relative services: Personal training Sport event tickets Etc. This growth dimension is based on you knowing your customers very well and being able to offer them more and more things based on this relationship. We discussed this already briefly in chapter 5 as a way to maximize the value of your customer base. As mentioned in chapter 5, imagex pro review, you don’t necessarily need to expand by yourself, but instead do it via partners (selling leads.) If you take the first step with a partner (and it is very successful), you can then take a further step and do it on your own. Adding new offerings to your website is a very natural growth path, but it has some pitfalls. There are a lot of bad examples out there of websites that have completely lost their heart and structure by having too many offerings in the same place. Instead of increasing the sale, this can dilute the trustworthiness and the sales funnel effectiveness, meaning that your conversion rates will drop. If you have concluded that a new offering is the right growth path for you to prioritize, you need to make a strategic decision on how it should be integrated in your online hierarchy. If the new category is far off and makes your website appear to look ”messy,” it might be better to promote it under a separate website. This way you can keep a “clean” and trustworthy story around specific niches you are targeting with each website. Tip #92: Make a strategic decision between creating a new category vs. a new website The downside of having separate websites is that you need to optimize both the organic and inorganic search traffic for more than one website. However, it does not necessarily mean more administration work to have separate websites for separate offerings. If you build your system smartly, you can separate the “front-end” from the “backend” of the system. The “front-end” is everything that your customers see and interact with, which can look completely different and must be optimized for the specific offering. The “back-end” is the “engine” of your system, i.e, how products, orders and payments are stored in data-bases and how you can access a control panel to manage these. Tip #93: Separate the "front-end" and the “back-end” to get synergies from different websites with similar business models When you grow by adding more offerings, it is important to keep a “trial and error”-approach. Remember that if you decide to expand the offering in one direction, you will not know the results until you see how the customers respond. Adding on more and more offerings can also put you in a bad spiral of making your website too “messy.” It will require some discipline to analyze your offerings and remove products or even whole categories that don’t add significant value. The best way to do this is to continuously evaluate your offering using the “Pareto Principle.” This means that you rank your products (or categories) in a falling order based on their share of the total accumulated sales value they stand for. For example, in the picture below you see the example that three shoe categories (Running, Indoor and Trekking) together stand for over 80% of the total sales. These are your “A-products” and should be top priority. On the other side of the range, you see that Golf and Cycling shoes only stand for around 1% of the total sales. Hence, the question you need to ask yourself is if it is really worth to keep them? The customers of these kind of shoes maybe have a different purchase pattern than your typical customers? It would probably take a lot of time and effort to turn these categories into higher sales volumes. Probably you will get better “return on investment” if you focus your time and energy on driving up the categories that are already selling well? Details:
