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The Death of the Small Guy




There is a powerful process at work in internet retailing that I call normalization. By this, I am referring to the tendency of markets to gravitate to a state where the profits go to the companies that deserve them while inferior companies fail.

This is not a popular subject and most of the online “gurus” deny this phenomenon. After all, they have to sell their marketing courses to people that believe they can start a website and get wealthy overnight.

I am asked constantly by friends what they can sell on the Internet. I always want to ask them why they think that I would share potential goldmines. My company has a software platform and system that can launch a sophisticated retail website within a few days. If I think of a good product to sell, I can be selling it by next week. The fact is that it is not so easy to come up with new products to retail online these days.

In the late 1990’s, the Internet was not normalized and practically anyone could make money online–fortunately that included me, an unsophisticated, naive software programmer that knew nothing about business.

Back in those days, there were staggering opportunities. We would start websites and sell hundreds of thousands of dollars in a few months without spending a dime on advertising. When CPM advertising came along, we bought huge blocks of advertising, broke it in small pieces and resold it with the PPC model with markups of up to 100%.

That was the past, but today’s Internet is very different. If I tried to start a internet retail business today with the resources and knowledge I had eight years ago, I am not sure that I would succeed–certainly not at the same level.

Buying a half dozen books and courses from so-called gurus is not going to make the average person successful. Even the gurus are struggling today, which might explain one of the most infamous ones, Rich Jerk, is trying to sell his guru busines at the moment.

All that being said, the Internet is still ripe for new business, even in retail. In today’s world, a successful online retail business must actually focus on business–issues such as intelligent purchasing, streamlined operations, human resources, and branding. If you do these things well, you will have a great chance for success.

So what advice can I give someone trying to start an Internet business in today’s environment? The same advice I would give to someone trying to start a business offline. Raise some money, be prepared to work hard, look for ways to differentiate, and think big.

Oh yes, one more thing… My best advice is to start today because as hard as it is today, it will be harder tomorrow.

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  • http://MatchTo.com Steve Morsa

    Good points, Greg.

    I would add one more factor I believe is virtually critical for anyone trying to build a real, sustainable business: Sell something you love and believe in.

    To do otherwise is to destine yourself to drudgery, unhappiness, and quick(er) burnout.

    Oh; and it looks like Rich Jerk has removed his listing.

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  • http://www.yeminlisozluk.com/index.php?ara=ingilizce a.erol

    be creative and team up if you want to achieve in internet. a creative idea and a good taem of friends (8-10 friends) is a very good tip to start off!