A Tea Business Website Launch Guide
Whether you consider E-Commerce to be your core business or simply a side offering to a tea shop, every tea business should have a website. If your core business is not the internet, at least make a small investment so that as you land customers who are visiting from across the country, you can continue serving them after they’ve gone home. Also, consider all the people who receive your teas as gifts but don’t live near your shop. A simple website won’t let you take over the tea world, but it will help you keep the customers you earn.
If your focus is E-Commerce, we recommend at least $125,000 in capital and the ability to work without paying yourself for six months or more. In round numbers, budget $50,000 for the initial website, $50,000 for operations (overhead, product, and administrative costs), and $25,000 for keyword advertising. More money is always better, but you’d be reasonably confident going to market with this kind of war chest.
Some may insist that an E-Commerce website can be created for a fraction of $50,000. This is very true. A bicycle will get you from point A to point B. A scooter is motorized and therefore faster. An economy car offers all of the core functionality that anyone needs. Why is the average car in the US a four-door mid-sized sedan sold for $30,000? Why do many Americans choose to pay more than $50,000 for transportation? Customers don’t choose products or services that offer only the minimum functionality. We like luxury hotel rooms, stores that are beautifully decorated and merchandised, and E-Commerce sites that are beautiful, functional, and easy to use.
The big-boys wouldn’t invest hundreds of thousands in ongoing web design and functionality improvements if a five-thousand-dollar or ten-thousand-dollar site would deliver just as many sales. If the leading tea websites would cost six figures to replicate (and most of them would), do you think you can beat them at their own game for 10% of that?
OK, so the reason for having a big budget is pretty apparent, but what if you don’t? That doesn’t mean you should give up. The more money you have, the better your odds of success. It’s not impossible; you just have to nail the design and user interface on the first try.
The time when a new website would attract customers just by existing is long gone. If all you do is launch a new E-Commerce site into cyberspace, you’ll be lucky to make one sale a week, even after six months in business. The most effective way to drive traffic is keyword advertising. Google’s AdWords is the king of this industry. Your advertisement will appear to customers who search for related terms like "Sencha", "Green Tea," or "Glass Teapot". You bid how much you are willing to pay for each person who clicks the link to your website. The beauty is that each customer is searching for a product that you sell, and you only pay if they click on your website.
Here’s how it would work: Let’s say you spend $25,000 to launch your website (including everything from shopping cart to graphic design, inventory, pictures, and hosting). You then invest $1,000 in keyword advertising and buy 2,000 targeted visitors to your website. If you’ve nailed the experience on the first try, and 10% of those visitors spend $30, then you’re good to go and can grow organically.
The math works out like this: Suppose you choose the keyword "Sencha" and pay $0.50 per click to your website. Two thousand prospective customers click the link, costing you $1,000. If 10% of your customers make a purchase, then you’re paying $10 per paying customer. Suppose the average customer spends $30. If the product costs you $10, and your cost of fulfilling the order (labor, packaging, overhead, etc) is $10, then you broke even on that order. Now you have a new customer, and when they reorder, you make a $10 profit.
If, on the other hand, only 5% of the visitors to your website choose to purchase, then the cost of new customer acquisition doubles to $20, and you lose $10 on each purchase. You then need to invest a couple of thousand dollars to improve the design and functionality of your website and another $1,000 in keyword advertising to bring more customers. The process repeats until your conversion rate (the percentage of unique website visitors that make a purchase) is high enough to cover your cost of product, fulfillment, and customer acquisition.
How do you know what to improve to increase your conversion rate? We suggest studying successful websites. Examine the simplicity and ease of use of the interface, as well as customer service offerings like customer reviews, live chat, and same-day shipping.
In addition to studying the competition, you need to have comprehensive traffic reporting. Google’s free offering, Google Analytics, probably has enough to get you started. You need to know where your customers are coming from and what they do when they get to your site. A good reporting package will tell you which links are clicked most often on each page of your site, where the customers are spending most of their time, and which pages the customers are most likely to leave. If most customers are deterred by the shipping cost, you need to increase your product price and offer free shipping. If most customers leave on the credit card page, it might be because your site doesn’t appear secure enough, and you should consider contracting with a verification service. The traffic reporting is only interesting if you have a decent amount of traffic, but it will tell you exactly where your strengths and weaknesses are.
If your focus is E-Commerce, we recommend at least $125,000 in capital and the ability to work without paying yourself for six months or more. In round numbers, budget $50,000 for the initial website, $50,000 for operations (overhead, product, and administrative costs), and $25,000 for keyword advertising. More money is always better, but you’d be reasonably confident going to market with this kind of war chest.
Some may insist that an E-Commerce website can be created for a fraction of $50,000. This is very true. A bicycle will get you from point A to point B. A scooter is motorized and therefore faster. An economy car offers all of the core functionality that anyone needs. Why is the average car in the US a four-door mid-sized sedan sold for $30,000? Why do many Americans choose to pay more than $50,000 for transportation? Customers don’t choose products or services that offer only the minimum functionality. We like luxury hotel rooms, stores that are beautifully decorated and merchandised, and E-Commerce sites that are beautiful, functional, and easy to use.
The big-boys wouldn’t invest hundreds of thousands in ongoing web design and functionality improvements if a five-thousand-dollar or ten-thousand-dollar site would deliver just as many sales. If the leading tea websites would cost six figures to replicate (and most of them would), do you think you can beat them at their own game for 10% of that?
OK, so the reason for having a big budget is pretty apparent, but what if you don’t? That doesn’t mean you should give up. The more money you have, the better your odds of success. It’s not impossible; you just have to nail the design and user interface on the first try.
The time when a new website would attract customers just by existing is long gone. If all you do is launch a new E-Commerce site into cyberspace, you’ll be lucky to make one sale a week, even after six months in business. The most effective way to drive traffic is keyword advertising. Google’s AdWords is the king of this industry. Your advertisement will appear to customers who search for related terms like "Sencha", "Green Tea," or "Glass Teapot". You bid how much you are willing to pay for each person who clicks the link to your website. The beauty is that each customer is searching for a product that you sell, and you only pay if they click on your website.
Here’s how it would work: Let’s say you spend $25,000 to launch your website (including everything from shopping cart to graphic design, inventory, pictures, and hosting). You then invest $1,000 in keyword advertising and buy 2,000 targeted visitors to your website. If you’ve nailed the experience on the first try, and 10% of those visitors spend $30, then you’re good to go and can grow organically.
The math works out like this: Suppose you choose the keyword "Sencha" and pay $0.50 per click to your website. Two thousand prospective customers click the link, costing you $1,000. If 10% of your customers make a purchase, then you’re paying $10 per paying customer. Suppose the average customer spends $30. If the product costs you $10, and your cost of fulfilling the order (labor, packaging, overhead, etc) is $10, then you broke even on that order. Now you have a new customer, and when they reorder, you make a $10 profit.
If, on the other hand, only 5% of the visitors to your website choose to purchase, then the cost of new customer acquisition doubles to $20, and you lose $10 on each purchase. You then need to invest a couple of thousand dollars to improve the design and functionality of your website and another $1,000 in keyword advertising to bring more customers. The process repeats until your conversion rate (the percentage of unique website visitors that make a purchase) is high enough to cover your cost of product, fulfillment, and customer acquisition.
How do you know what to improve to increase your conversion rate? We suggest studying successful websites. Examine the simplicity and ease of use of the interface, as well as customer service offerings like customer reviews, live chat, and same-day shipping.
In addition to studying the competition, you need to have comprehensive traffic reporting. Google’s free offering, Google Analytics, probably has enough to get you started. You need to know where your customers are coming from and what they do when they get to your site. A good reporting package will tell you which links are clicked most often on each page of your site, where the customers are spending most of their time, and which pages the customers are most likely to leave. If most customers are deterred by the shipping cost, you need to increase your product price and offer free shipping. If most customers leave on the credit card page, it might be because your site doesn’t appear secure enough, and you should consider contracting with a verification service. The traffic reporting is only interesting if you have a decent amount of traffic, but it will tell you exactly where your strengths and weaknesses are.