Fab.com Loses Almost a Billion

Fab.com is an all too common story about a startup that raised hundreds of millions, apparently $310 million as of November of 2014. It was rumored that it may sell and it did.

Fab.com Sold for $15 Million

According to re/code Fab officially sold for $15 million, partially cash and partially stock. You may be thinking, wow $15 million is not bad. But consider they raised over $300 million at a valuation around $1 Billion.

This is a story that happens more than you may realize as most venture funds do not publicize these types of losses. At the height of the company there were 750 employees. Just like stocks, it always appears going up takes time, coming down is swift.

What Are My Options For Marketing Online?

The internet has revolutionized the way you have to think about marketing. Whether you like it or not, marketing online is now one of the major areas you have to think about as an entrepreneur. And in order to do online marketing effectively, you have to go back to the basics and understand how it works, and understand what your options are.

Marketing as a concept means to make a product or service known to potential customers. This concept has been around for decades in its most traditional forms. And guess what, the basic concept remains the same when we move to modern forms such as online marketing.

With online marketing, it won’t really make a big difference whether you’re dealing with a small business or a large company. And yes, online marketing is just as necessary for offline businesses as it is for online businesses.

There are many advantages to online marketing, with the most important one being that you won’t need a huge budget to achieve good results. With traditional marketing methods and strategies, it’s virtually impossible to outdo a company with a marketing budget bigger than yours. Online marketing however makes this quite possible.

However, when you decide on doing your your marketing online, you must understand that it’s all about using the appropriate channels in smart ways. Spending big bucks on online marketing does not always guarantee success.

Online marketing options

To start building an effective online presence for your company, the first thing you’ll need is a website. Of course, there are ways to do it without a website as well. However, having a little corner of the Internet dedicated to your company and its products and services can go a long way.

By having a website for your business, you can get closer to potential customers and present a better image of your company. Customers should get to know the character of your company, as well as the products and services offered. When it comes to online marketing, the website is in a way the face of the business or company. Your website is how people get the first impression about your business.

However, having a website won’t bring you new clients by itself. You need to work on ways for people to find out about you and get to your website. Otherwise, simply building the website will be as profitable as building an amusement park in the middle of a deserted island.

Assuming your already have a website for your business, the next step is to direct people to your corner of the World Wide Web. There are several ways to market your website in order to spread the word about your business.

Social media marketing
Making your brand known by using social media platforms is one of the fastest emerging ways for companies to attract attention on the Internet. By embracing the world of social media, companies encourage people to engage with them, bringing brands closer to existing and potential customers.

The social media websites most commonly used for online marketing include Facebook, Instagram, Twitter, Pinterest and the like. Social media marketing focuses on quality content creation and interactivity between the customer and the company.

Google AdWords
This is an advertising system provided by the Internet’s largest and most widely used search engine, Google. AdWords works by placing your ad at the top, bottom or the sides of search results whenever a relevant search query is performed. AdWords is flexible, so can choose to pay per click, or for every 1000 times the ad is displayed.

You can also try the newer and simpler version of AdWords called AdWords Express. AdWords Express is aimed at small and medium sized businesses, or those who simply don’t have as much time to run a full Adwords campaign.

Google Places a.k.a. Google Business
This is a free feature offered by Google to help businesses connect with locals. The unique thing about Google Places is that it will not only list your company in the search results, but also on Google Maps. This tool can also provide people with general information about your business, such as the exact location, phone number and working hours. On Google Places, users can also upload pictures and write reviews about your company.

Google Places is incredibly easy to set up. Its also very easy to understand how it works. Let’s say you own a pizza restaurant in New York. A person making a Google search for “pizza restaurant New York” could easily come across your restaurant if you’re registered on Google Places.

Search engine optimization – SEO
This is a way to optimize your website to display more often in the search engine results. Unlike Google Adwords which is a paid service, SEO falls into the “organic search” advertising category. This means that the pages which appear in the search results, do so entirely because of the relevance to the search terms. In other words, if you are listed in the search results, you do not need to pay Google for it.

SEO (search engine optimization) is a process by which you can improve your rankings, which means more free traffic for you. Unlike the other options, SEO is not in itself a tool, but an Internet marketing strategy. Optimizing a website for positive search engine rankings largely depends on search engines’ algorithms, which are liable to frequent changes. In order to optimize a website for SEO, its content and HTML need to be modified to increase relevance (this is known as “on-page SEO”).

Increase your profits by increasing online audience exposure

Any company can benefit from implementing a good marketing strategy. Online marketing is beneficial for both companies doing business online, as well as for more traditional “offline” businesses.

Traditional marketing methods may be considered a “safer tactic” simply because they’ve been around for a lot longer than the Internet. However, many of the variations on traditional marketing still require big budgets to cover an ever decreasing audience and shrinking exposure. On the other hand, the number of people who trust the internet to pick a brand keeps rising.

Online marketing is undoubtedly the best way to go about making your brand well known to potential clients. These days, we have more than enough options for online marketing. However, the perfect strategy is always a mix of the different options that you have deemed appropriate for your business.

It’s on you to choose the right set of online marketing tools and techniques for your company. Don’t miss out on these opportunities to build an effective online presence. Online marketing is definitely worth your time.




The best online store builders with online marketing tools

It’s safe to say we’re a part of the first generation that gets to make the most out of the Internet. One of the many advantages of the Internet is the ability to shop online. But it’s not just that you can do your own shopping online. These days it’s easy for anyone to set up their own shop and sell goods online! This means it is very easy to also have an online business by selling products online. And then if you learn proper online marketing, you can get a lot more customers with your online store than you would ever be able to by running a physical store.

Setting up an online store used to be, and is still considered by some to be a complicated task. Most of us are probably not well acquainted with the crucial elements and the way they function as a part of an online store.

The good news is that the whole concept of running an online business and running an online store is not that complicated. There are special online store builders that can help you can not only understand the process better, but also build your online store in no time.

Most popular online store builders and their online marketing capabilities

The advantages of having an online store over having a physical retail store are too many to count. However, that doesn’t mean that running an online business is easy. You should put just as much thought and effort into setting up your online store as you would with a regular retail store.

Online store builders are meant to be all-in-one systems that are supposed to provide you with everything you need to set up an online store. However, not all online store builders are created equal. The differences between various online store builders vary based on the services and features offered, their versatility, quality and ease of use.

Take a look at some of the most widely used online store builders and the features offered.



Weebly

Weebly was founded in 2006 and in 2007 it was selected for the winter startup program of the Y Combinator in Silicon Valley. As reported in 2012, Weebly hosts over 20 million websites. Starting off as a simple website creator, Weebly now stands behind not just e-stores and personal pages, but many other types of websites, too.

Main features: Weebly’s website creator is most of all known for its simplicity and ease of use. It provides a good range of elements you can use in creating a website. And these elements are presented to you as part of the Weebly drag-and-drop website builder. This means that you do not need any specialized knowledge to set up an online store with Weebly. Just drag and drop until you like what you get.

Online marketing: Weebly enables you to set up all of the basic SEO functions for each of your website’s pages. There’s also a website statistics dashboard offered by Weebly, useful for keeping track of page views and unique visitors over a period of time.

Price range: Other than the option to build a website for free, Weebly offers three premium plans. The following prices are valid for a six month plan, but there are bigger discounts for the one year and two year plans.

  • Starter Plan – $4.83 per month;
  • Pro Plan – $9.83 per month;
  • Business Plan – $29.00 per month.



GoDaddy

Primarily a company that specializes in web hosting and domain registrations, GoDaddy was founded in 1997 and currently manages over 58 million domains. GoDaddy offers a multitude of products and services, from domains and hosting, to email and marketing tools, and even website creators.

Main features: This company has been in the game long enough to know how to keep customers. The GoDaddy website builder has a sleek and intuitive design, offering a wide choice of free website templates. You can easily customize the look and feel of your website, and GoDaddy will automatically optimize it for mobile devices like smartphones and tablets.

Online marketing: GoDaddy has a very handy SEO wizard that enables you to take control of all areas of search optimization. A minor flaw is that GoDaddy doesn’t let search engines index pictures. Other than that, GoDaddy also has a separate SEO service that you can incorporate into your plan, starting at $2.69 per month.

Price range: Godaddy does not offer a free trial period, but they do have a refund period of up to 45 days for their annual plans and 48 hours for their monthly plans. They have three plans to choose from.

  • Personal Plan – $5.99 per month;
  • Business Plan – $9.99 per month;
  • Business Plus Plan – $14.99 per month.



Shopify

Founded in 2004, Shopify was based on software originally intended for the creators’ own online store. Shopify has reported that there are over 120,000 users of their platform, making it one of the fastest growing online store builders.

Main features: A bit more diverse than its competition, Shopify offers both an e-commerce platform and a point-of-sale software. Businesses using Shopify can accept Paypal or Bitcoin payments.

Online Marketing: Shopify offers built-in SEO features as well as advanced e-commerce analytics. You can have full reports about details and statistics on how many people find your website and how they find it.

Price range: Shopify offers a 14-day free trial period. After your trial period is over, Shopify has four plans if you want to continue building your store with them.

  • Starter Plan – $14 per month;
  • Basic Plan – $29 per month;
  • Professional Plan – $79 per month;
  • Unlimited Plan – $179 per month.



Wix

Wix is a freemium web development platform, so users can create basic websites for free. However, users must have a premium packages to remove ads, add e-commerce capabilities, connect their websites to their personal domain and so on.

Main features: Primarily a website creator, Wix gives users complete freedom in creating their online store the way they want it. Their drag and drop tools make it incredibly easy to create your own store. There is also a special mobile editor for adjusting Wix sites for mobile viewing.

Online marketing: With the ShoutOut application by Wix, you can easily send newsletters, but that on its own, is not enough for doing marketing. You can set up the basic SEO tags, but there is also the option of looking up additional SEO tools on the Wix App Market.

Price range: Despite being one of the leaders in the website building field, Wix has just one website plan that includes a shopping cart and is suitable to running an online business.

  • Yearly eCommerce Plan – $16.17 per month;
  • Monthly eCommerce Plan – $19.90 per month.




Should I raise venture capital for my online business?

Venture capital is money provided by an investor to small businesses and startups that have good growth potential. This is an essential funding source for many new businesses, including any online business, since most of them do not have access to capital markets. Even though it is an immense risk for the investor, it also represents good potential for highly profitable returns.

One of the biggest challenges that new entrepreneurs face when starting an online business is securing financial support. Some of them have already started working and need to expand their businesses, so this kind of financing is a great opportunity for them.

Advantages and disadvantages of raising venture capital

Lack of financial means is often the main obstacle between a great idea and a profitable business. Working with financial support such as venture capitalist funds or angel investors  has some advantages and challenges, too.

online-business-venture-capital

Venture capitalist corporations are companies that make calculated investments in small businesses or startups that have a potential of becoming profitable. These companies typically specialize in investing a specific industry. Their funding may come with certain conditions that you may or may not be willing to agree to.

Angel investors also offer start-up financial funds, but these are often much lower than those from venture capitalist companies. They are either individuals or small capital groups and invest lower amounts of financial means. Angel investors do not impose as many conditions as venture capitalist companies do, but they also don’t provide you the expertise that venture capitalists do.

Both investment options involve some risks as well as rewards. When starting an online business there are some pros and cons that every entrepreneur should consider. Before you decide whether to raise such capital though investors for your online business or not, double-check your options and obligations to your potential investors.

Advantages of raising venture capital

Venture capital companies have large amounts of financial means and they are looking for good investment opportunities. Most of these companies, aside from the financial investment itself, offer their well prepared and experienced consultants to direct you through running your new business. They have access to a lot of information and relevant knowledge in your area of interest.

Due to their interest in seeing your business succeed, they will provide you with the best management support there is. They also maintain good relationships with other potential investors that may be beneficial to your business growth down the line.

Venture capitalist financial support is often much higher than the amount that you can get approved for by banks or other financing venues. You don’t have to ask your local bank for a loan. By raising venture capital for your online business, you exclude repayments of debt. Raising finances through venture capital allows you to worry less about your finances.

venture-capital-pros

Your experienced team of investors will provide you with stability and help you focus on the big picture. When starting a new online business it is challenging to know what to look for when hiring employees for all the working positions you offer. Competent management teams are a high priority for venture capitalists, so they will provide support to you and help you recruit the best ones.

For most small businesses and and online startups it is common to be “unknown” to potential consumers. At first you do not have a well known, built-up brand. Things are different though when you gain credibility through your venture company. Your potential customers feel more confident doing business with you due to your reliable financial backing.

Disadvantages of raising venture capital

Although you are the person that founded your company, and you have the CEO title, you are obliged to answer to the board. Once you raise venture capital it’s not just “your company” anymore. The venture capital company will take a few board seats and the right to decide and control your firm’s capital. You will need their approval for any further business steps.

Your independence and control are now relative and limited based on how much cash you have accepted. Some investors may ask you for a great share of your company in exchange for a big amount of financial support. However, you should ask yourself if the offer is really acceptable and how you feel about losing you control to some level.

venture-capital-cons

Venture capitalists have their own demands when investing in your company. Once you decide to take financial support from an outside source it is inevitable that you share your profit. You may face a drastic lowering of profits that your company may keep if it succeeds. Consider how much money your company will receive once all shares are paid.

Another crucial point is if the company’s stock value decreases, the venture capital company usually gets some stock for free. Also, they always get a rate of return which is guaranteed. A venture capital investor has a liquidation preference and gets principal and dividends before anyone else gets their share.

Venture capital companies reduce their investment risk by co-investing with other companies. Differences in opinions do happen and personal interests often prevail. Balancing your interests with the ones of the venture capital company can be a full-time job for you or anyone in the chief executive position.

When asking a venture investor to invest in your start-up online business, you should be prepared to wait. They do their own market research, so it can take more than three or four months before they decide.

The final decision about your online business…

Venture capital funds are mostly used by companies that don’t have an acceptable enough operating history to qualify for bank loans. You’ve developed your product/service and you’re ready to start your new adventure with an online business. The only thing missing is enough capital to get started and keep growing.

Should you raise venture capital for your online business? There is no right or wrong answer. Venture capital funds are not easy to get. There is always the chance that you’ll be turned down by these investment companies. There are some positives, as well as negatives to both options. If you choose venture capital, at least try to understand what the stakes are.

If you choose to raise venture capital you should do your best to get it. Prepare financial projections, presentations, and try to make your proposal more compelling. Then, you’ll have to contact several venture capitalist companies that do investment in your industry and hope to make your vision a reality.

Disneys Magic Bands Leap Frog Mobile Payments and Obsoletes Apple Pay

It is often said that the entertainment industry paves the way for new technologies. I was blown away by how the Disney Magic Bands worked on my recent trip to DisneyWorld.

I like, not love, the idea of making payments with my mobile phone much like the new Apple Pay. However I am not loving that idea as my phone will run out of battery or often does not work properly when I need it to. So the idea of mobile phone payments has not really seemed like the amazing alternative to my wallet as it is made out to be. You may not like my opinion however mobile payments have not taken off. Maybe Apple Pay will be different, only time will tell.

For me I look at it as the difference between my wallet or my phone, they are both the same size in my pocket so what do I care. A very crude comparison I admit, but that is how I see it.

However I just returned from Disney World and after using the Magic Band I came back wanting to use it every day. I also want my entire family to use it every day. I have no desire to use mobile phone payments. The soon to be released, in 2015, Apple watch still requires an iPhone. My wife has an iPhone so maybe that would work for her. I have a mobile phone, non Apple (Samsung), but I would not want to have to buy 3 more mobile phones for my 3 kids (at either around $1,500 for three phones or another $120 or so a month) just so they can use a mobile payment watch or just a type of mobile payment. Therefore the Disney Magic band is ideal for myself and family if they are the current cost of $12 each with no monthly fees, I want to use them all the time.

MagicBand at the Park

Okay here is what happened. I went to Disney with my family, five of us total. We happened to be staying at a Disney resort hotel. On check in I was expecting to be given a couple room keys which are of course credit card style keys. And I had also purchased passes for the parks which also resemble credit cards, one for each person. So having three kids I expected to be constantly worried about losing either a room key or more importantly a park pass.

disney magic bandsI had no idea what was about to happen when I checked in. The assistant handed me 5 arm bands that looked like sport watches without the time. My first thought was “great .. more things for me to loose, thanks a bunch”, then he explained how they worked.

He starts, “you put this on your wrist and swipe it against your door and it works as your room key“. So now everyone in my family wears the band and has a room key, they strap very tightly and comfortably to the wrist so my kids will not lose them. Wow I am sold, coolest thing ever, but that was only the beginning.

Then he says, “download the Disney app on your phone and you can quickly associate your park passes with the watches“. My mind was blown. I was able to take each park pass and scan it and assign it to a watch and then hand it to a kid, each one took 10 seconds tops. Now each child, my wife and I, have a plastic band on our wrist. We do not have room keys to lose and we no longer have park passes to lose. Amazing, this could not get any better. But wait there’s more.

“Now we can also associate the bands to your credit card on file and you can enter a 4 digit pin code now for security”. Why in the world would I want that? “Because you can use it to purchase anything, anywhere, at any time and no longer need your wallet here are the Disney parks [dummy]“. (in his defense he did not say ‘dummy‘, he was thinking it I am sure, but he did not say it). Again, mind blown. I entered my four digit pin. I am now officially a super hero. On my wrist is access to my room, access to the parks, and throughout the week I was able to purchase all our food, meals, merchandise, whatever I wanted with my arm band.

use magic bandBetter yet my kids were able to use the bands as well since I shared the code with them. Everywhere we went there was a simple round device, much like a credit card processing machine that you would swipe the arm band against and enter your pin and done, you have paid.

Not only are the Magic Bands convenient but for those of you like me, who are constantly checking my pockets and wallet to make sure I have not forgotten anything, I had an incredible piece of mind as I only had to glance at my wrist to know that I had my room key, park passes, credit cards, cash, wallet, everything I needed. It made my park experience that much more enjoyable.

It was amazing but there was even more to it than that. With the Disney application on my phone I was able to obtain Fast passes for each of us. Instead of having to obtain a Fast pass at a kiosk at a Disney park I could do it in our room before we even entered the park. Not only that but I could obtain fast passes for each of us, different ones for different people and it associated them to the Magic Band. In the past we would obtain passes at a kiosk after standing in line, only to inevitably have someone lose their pass or two. But not anymore, you walk up to the Fast pass line and swipe your Magic Band and you are in. Unbelievable. So convenient.

Magic Band is Magic Indeed

How does it work?

From the Disney site “The MagicBand uses radio frequency (RF) technology to connect guests to their plans and entitlements safely and securely. Guests simply touch their band to touch points in places such as resort room doors, theme park and water park entrances, FastPass+ entrances and cast mobile devices. Purchases require a four-digit PIN. MagicBands do not use GPS technology. Guests’ personal data is not stored in the MagicBand. MagicBands and RF-enabled cards contain only a randomly assigned code that securely links to an encrypted database and associates the guest’s MagicBand or ticket with the experiences they’ve selected.

Mickey Mouse or Big Data and Cutting Edge Technology Company

mickeyAlright, now I have a totally different view of Disney. Disney the company (NYSE:DIS) could be considered as much a Technology company as an entertainment company. Consider how much “big data” Disney now collects. Consider their latest Magic Band and the impact it will have on mobile payments. The Magic Band was introduced into full production in early 2014 and the Apple watch is not due until sometime in 2015 and the Apple watch is tied to the iPhone. So the Mickey Mouse company beat Apple to the punch? WOW.

And get this, Disney has applied for or been granted more than ten patents on the MagicBand. Ba dump bah. Boom. Licensing revenue IBM style. You go Disney.