The economic turmoil of the past month has caused many businesses to tighten their purse strings and many investors to park their money in “safe” investments.
Because of the uncertainty in the markets, many companies have chosen to cut back on staff, on capital investments and on their online e-commerce and marketing efforts.
Similarly, investors have become extremely squeamish about putting money into almost any kind of investment at all. Think about where you are going to get the biggest bang for your dollar today. It certainly isn’t in savings accounts, CDs or Treasuries. The real estate market remains dangerously volatile.
As the CEO of Blue Fountain Media, a Web design, development, online business strategy and online marketing firm, I can say with 100 percent confidence that the one area that is growing, and will continue to grow, is e-commerce. There has never been a better time for businesses to conduct business online and for investors to put their money into businesses that understand how to do business online.
Taking money away from online ventures—in this climate—could be the biggest mistake a business ever makes.
According to Forrester, online retail sales are expected to grow at least 10 percent a year over the next few years. By 2014, more than 50 percent of all retail sales will be handled online. More than $450 billion is spent per year on online advertising. This year, approximately 150 million Americans will buy online, with that figure going up to 170 million by 2015.
When I say “online business,” I mean much more than just a website. It is about taking advantage of mobile platforms, including phones, iPads and other similar devices. I also mean taking advantage of the many social media options available out there.
The number of people using smartphones is growing exponentially—well over $100 billion in business is expected to be conducted on mobile platforms by 2014.
Just look at the hottest businesses—they are the ones doing business online. I’m not just talking about the Amazons, Googles and Facebooks out there. Just recently Airbnb.com, a company that helps to book bed and breakfasts and apartment sharing, raised $120 million for a valuation of at least $1 billion. Look at the Foursquare, Groupon, LivingSocial and Gilt.com. Seemingly out of thin air, the Web provided the opportunity for smart businesses to succeed quickly and in a huge way.
Let me make one thing very clear. Just because you take the step to do business online, it doesn’t mean you will succeed online. While most online businesses either fair or fail to deliver a significant return on investment, businesses that understand how business is conducted online and how Web users behave online have a great chance of succeeding.
The problem is that most Web design companies have little or no idea what drives business online. There are plenty of companies out there that can deliver websites that are beautiful and creative. But a beautiful site doesn’t necessarily deliver sales. Many excellent graphic designers ended up going into the Web design business. They tend to be very creative people, but creativity, without understanding the science of online user behavior, is a recipe for disaster.
When looking for a Web design and marketing team to work with, you need to do much more homework than just looking at their designs. Make sure they provide you with case studies, testimonials and hard data. In other words, have these companies designed website and strategized and executed online marketing plans that enhanced their clients’ businesses?
This is actually the perfect time for businesses to make a substantial investment in their online presences. The Web is always evolving and businesses that go to the sidelines are doomed to lose ground. If your competition is sitting it out, it gives you an amazing opportunity to get ahead and stay ahead.
OPEN Cardmember Gabriel Shaoolian is the founder and CEO of Blue Fountain Media, a results-driven Web design and online marketing company based in Manhattan.