[nazgul]

Ive been seeing guides and people making 6 figures starting ecommerce sites. Is this legit?

[Suits]

[the-dream]

The people writing guides are probably not legit, in the sense that they don't make 6 figures with ecommerce. They are probably just trying to hustle ebook sales or Shopify sign up commissions. However, there are millions of people who are making 6 figures doing ecommerce, they're just not shouting it from the rooftops.

Even though these people writing guides and claiming to be making 6 figures are almost certainly lying, their material can still be helpful and give you a basic outline of what to do. Just take their claims with a grain of salt and try and put your own twists on it.

[Plus Oultre]

Why all your five posts end with a question mark? Think about it, write a two page answer, and you will find what you are looking for.

[jamaicabound]

Most people who are running huge online businesses don't have time to sell courses and chase affiliate commissions. Most of these Amazon gurus for example make WAY more money selling courses than they do selling on Amazon. One particular high profile Amazon guys was recently outed that he's sold 3 shitty amazon products in his whole career on Amazon yet he's made millions selling courses teaching something he himself doesn't even know how to do.

As far as eCommerce businesses go, yes absolutely peole make millions, however keep in mind that a "real" ecommerce business can make money, a Shopify dropshipping store 99% of the time cannot. I'm sure someone will chime in here and say they have success with it and I'm sure some due but they are the exception rather than the rule.

[gework]

Probably in some cases, but eCommerce is best left alone for most people. According to this maybe as many as 97% of eCommerce sites fail; whereas 50% of businesses fail within 5 years. I'd say 99% of eCommerce sites fail.

I used to make a lot of eCommerce site in the "golden age" of eCom, around 2006. I think there were maybe 20-40 eCom clients during this time and I don't think a single one exists today. One (which had no SEO other than some which was done for free) cost about $10-15K in current prices. It was a pretty high-end site, but after about 7 years it hadn't even turned the revenue that it cost to build. For ones I did "SEO" for quite a few of them did nicely. Some were probably turning up to $5K profit a month from the work. Yet others couldn't pay their bill as the SEO didn't work.

A friend did his own eCom site and SEO. He was quickly able to bladder it up Google and was doing (due to favourable exchange rates) what would have been $100,000/year at the time. Then came 2008-2009 when most of these sites went from making making decent money to having a virtually useless website. Google flipped the script after years of being able to easily spam sites up for terms.

However, during that period, these small companies that were often jostling with big brands had pretty poor conversion rates as they were unknown companies and people don't like taking punts on unknown companies. People I knew who split tested their sites could maybe double their conversion rates, but they were never a pinch on the likes of Amazon.

My main client had a warehouse that was about 100mx100m. He was a former programmer who got into the game while the going was good and was able to spam himself up for lots of terms. He was probably turning £1-2M in rev., big boys were sniffing about thinking they might buy him out. Today that website is an affiliate site that probably makes $500 / year. The guy has gone to consulting.

In short, in the current climate you need to be a genius to setup an eCommerce site that can make good money and survive against the hyper-competitive monsters of eBay and Amazon. Many former major on- and offline retailers are now reduced to selling on eBay and giving them a cut.

I've come across a lot of people who ask about eCommerce and drop shipping. Selling things online is a really low bar as it is; eBay and Amazon have buried that bar. Stay away unless you have a unique angle and know your stuff.

[456]

^-- very interesting.

I've seen some interesting eComm plays -- there usually is a big draw to why one would use THEIR platform.

Many times it could be a Charitable tie-in, with requisite related 501©3, or with a very strong publishing play to support and generate their own traffic.

I knew a successful operation (5-10mm/year revenue, contracted fulfillment operations, acquired with similar sibling companies sharing resources).

They relied a lot on FB ad spend, but when they actually were doing really well, FB jacked up the prices so the CAC ate too much into their margins.

Trend is obviously toward subscription, direct-to-consumer, any way to commit to more revenue even at lower unit costs.

Acquisition plays are about bringing a Customer Base (and attached story/brand) to a larger company that can scale it upwards and outwards to different locales, etc. Implicit is that this customer base was Not getting reached by the larger company, and wouldn't trust a new brand created by the larger co (but would trust the brand that started small and was later acquired).

[Simeon_Strangelight]

(04-25-2018 01:16 PM)gework Wrote:  

Probably in some cases, but eCommerce is best left alone for most people. According to this maybe as many as 97% of eCommerce sites fail; whereas 50% of businesses fail within 5 years. I'd say 99% of eCommerce sites fail.

I used to make a lot of eCommerce site in the "golden age" of eCom, around 2006. I think there were maybe 20-40 eCom clients during this time and I don't think a single one exists today. One (which had no SEO other than some which was done for free) cost about $10-15K in current prices. It was a pretty high-end site, but after about 7 years it hadn't even turned the revenue that it cost to build. For ones I did "SEO" for quite a few of them did nicely. Some were probably turning up to $5K profit a month from the work. Yet others couldn't pay their bill as the SEO didn't work.

A friend did his own eCom site and SEO. He was quickly able to bladder it up Google and was doing (due to favourable exchange rates) what would have been $100,000/year at the time. Then came 2008-2009 when most of these sites went from making making decent money to having a virtually useless website. Google flipped the script after years of being able to easily spam sites up for terms.

However, during that period, these small companies that were often jostling with big brands had pretty poor conversion rates as they were unknown companies and people don't like taking punts on unknown companies. People I knew who split tested their sites could maybe double their conversion rates, but they were never a pinch on the likes of Amazon.

My main client had a warehouse that was about 100mx100m. He was a former programmer who got into the game while the going was good and was able to spam himself up for lots of terms. He was probably turning £1-2M in rev., big boys were sniffing about thinking they might buy him out. Today that website is an affiliate site that probably makes $500 / year. The guy has gone to consulting.

In short, in the current climate you need to be a genius to setup an eCommerce site that can make good money and survive against the hyper-competitive monsters of eBay and Amazon. Many former major on- and offline retailers are now reduced to selling on eBay and giving them a cut.

I've come across a lot of people who ask about eCommerce and drop shipping. Selling things online is a really low bar as it is; eBay and Amazon have buried that bar. Stay away unless you have a unique angle and know your stuff.

What's your view of guys like Alex Becker?

My take is that the lives off people trying to make it via ecommerce plus got himself a huge set of personal data that he uses for various projects.

[Ice Man]

Hey guys, isn't 1996 amazing!

[jamaicabound]

(04-26-2018 02:31 AM)Zelcorpion Wrote:  

(04-25-2018 01:16 PM)gework Wrote:  

Probably in some cases, but eCommerce is best left alone for most people. According to this maybe as many as 97% of eCommerce sites fail; whereas 50% of businesses fail within 5 years. I'd say 99% of eCommerce sites fail.

I used to make a lot of eCommerce site in the "golden age" of eCom, around 2006. I think there were maybe 20-40 eCom clients during this time and I don't think a single one exists today. One (which had no SEO other than some which was done for free) cost about $10-15K in current prices. It was a pretty high-end site, but after about 7 years it hadn't even turned the revenue that it cost to build. For ones I did "SEO" for quite a few of them did nicely. Some were probably turning up to $5K profit a month from the work. Yet others couldn't pay their bill as the SEO didn't work.

A friend did his own eCom site and SEO. He was quickly able to bladder it up Google and was doing (due to favourable exchange rates) what would have been $100,000/year at the time. Then came 2008-2009 when most of these sites went from making making decent money to having a virtually useless website. Google flipped the script after years of being able to easily spam sites up for terms.

However, during that period, these small companies that were often jostling with big brands had pretty poor conversion rates as they were unknown companies and people don't like taking punts on unknown companies. People I knew who split tested their sites could maybe double their conversion rates, but they were never a pinch on the likes of Amazon.

My main client had a warehouse that was about 100mx100m. He was a former programmer who got into the game while the going was good and was able to spam himself up for lots of terms. He was probably turning £1-2M in rev., big boys were sniffing about thinking they might buy him out. Today that website is an affiliate site that probably makes $500 / year. The guy has gone to consulting.

In short, in the current climate you need to be a genius to setup an eCommerce site that can make good money and survive against the hyper-competitive monsters of eBay and Amazon. Many former major on- and offline retailers are now reduced to selling on eBay and giving them a cut.

I've come across a lot of people who ask about eCommerce and drop shipping. Selling things online is a really low bar as it is; eBay and Amazon have buried that bar. Stay away unless you have a unique angle and know your stuff.

What's your view of guys like Alex Becker?

My take is that the lives off people trying to make it via ecommerce plus got himself a huge set of personal data that he uses for various projects.

I used to actually like Alex Becker. I thought he was kind of funny and also provided some value in his content. He started doing all those video game videos and getting into really dumb stuff and that kind of started to turn me off.

I also used to see him as a software developer, making lots of money, etc. I never really dug that much into his past but that's what he claimed.

Obviously his audience is made up of younger less experienced guys in business and ecommerce and he used to kind of talk as if he was above them, saying things like I'm not into Shopify or eBay or Dropshipping, I'm a multimillion Dollar software developer and SEO.

What I found was funny is all the sudden every video is about how to make a million Dollars dropshipping as a 15 year old. All the sudden he's a Shopify expert and a FB ads expert.

Don't get me wrong I think the dude is probably pretty business saavy and the marketing methods he used for sourcewave and his softwares can carry over into products and consumer goods sold on say Shopify but it's just so transparent that the guy will run to wherever the money is. He saw SEO kind of fizzling out and rebrands himself as a Shopify expert. I can't knock the guy its a smart thing to do and his income has probably quadrupled since doing so but I don't really respect the guy nor do I enjoy his content or feel he is a good person to learn from.

Honestly most of the best informational content online about business is not comming from the giant Youtubers, its comming from channels with like 500 subscribers. The Tanner J Foxes and Dan Dasilvas and Alex Beckers are infotainment. Shit half these videos are hey look at my new house, look at my lambo, whats it feel like to be a 20 year old millionaire. That doesn't do shit for someone wanting to learn business.

[Simeon_Strangelight]

"How does it feel to be a 20-something self-made millionaire?"

"It feels good man, it feels good."

"Can I replicate what you have done?"

"Unlikely due to a variety of reasons, but you trying will make me richer, so I say - YES!"

[polar]

gework and 456 prove that even a junk first post can elicit valuable information from those with practical experience.

[456]

Hah thanks @polar -- I always enjoy when a shit thread evolves into something useful.

Sometimes those "johnbozzzz" questions really do evoke great discussion.

[Lighter]

The only viable way to make eCommerce successful (in my opinion) is to provide some sort of value with a custom product.

Dropshipping the same crap from AliExpress as everyone else?

Not going to work.

Creating a unique product that solves a huge need in one particular niche, building a high quality brand in that niche, and then releasing more high quality products in that niche under that brand?

You might be onto something. Hell, you can be the guy selling to dropshippers at that point. A good example of that business model is YETI (the cooler company).

The one that will make you 7 figures requires significantly more risk, time, and money (barriers to entry).
The other requires an internet connection and a credit card.

Also to OP, 6 figures is $100,000... that isn't much money. Think bigger.

(04-25-2018 01:16 PM)gework Wrote:  

A friend did his own eCom site and SEO. He was quickly able to bladder it up Google and was doing (due to favourable exchange rates) what would have been $100,000/year at the time. Then came 2008-2009 when most of these sites went from making making decent money to having a virtually useless website. Google flipped the script after years of being able to easily spam sites up for terms.

This is a good example of a "business" (I use the term loosely) that provides little to no actual value. Businesses that provide little to no value will get crushed much faster than a business that provides massive value.

Was he selling his own custom products? Dropshipping? Importing other people's products?

[jamaicabound]

(05-04-2018 01:40 PM)Lighter Wrote:  

The only viable way to make eCommerce successful (in my opinion) is to provide some sort of value with a custom product.

Dropshipping the same crap from AliExpress as everyone else?

Not going to work.

Creating a unique product that solves a huge need in one particular niche, building a high quality brand in that niche, and then releasing more high quality products in that niche under that brand?

You might be onto something. Hell, you can be the guy selling to dropshippers at that point. A good example of that business model is YETI (the cooler company).

The one that will make you 7 figures requires significantly more risk, time, and money (barriers to entry).
The other requires an internet connection and a credit card.

Also to OP, 6 figures is $100,000... that isn't much money. Think bigger.

(04-25-2018 01:16 PM)gework Wrote:  

A friend did his own eCom site and SEO. He was quickly able to bladder it up Google and was doing (due to favourable exchange rates) what would have been $100,000/year at the time. Then came 2008-2009 when most of these sites went from making making decent money to having a virtually useless website. Google flipped the script after years of being able to easily spam sites up for terms.

This is a good example of a "business" (I use the term loosely) that provides little to no actual value. Businesses that provide little to no value will get crushed much faster than a business that provides massive value.

Was he selling his own custom products? Dropshipping? Importing other people's products?

I completely agree with you about the Ali Express dropshipping non-sense.

I woudln't say however you need to invent some new product. Honestly inventing something new, having the cash to make molds for a prototype, etc, etc, etc is probably more money and more complciated than 90% of people rushing into ecommerce are capable of. It can also be a challenge inventing something new as you have to educate the population on what your product is, why it's better, and how to use it.

I buy existing normal everyday products from Alibaba suppliers all the time. Sometimes it's as simple as marketing a product to a new audience. This is a stupid example but just as an example say something like tennis balls, I never go to sportsauthority and buy tennis balls, yet someone markets tennis balls as a dog toy and I buy them from amazon. there's all types of products that are typically marketed to one audience but will work for someone in another niche. could even be something like camping sleeping mats could be sold to a day care center as nap mats, just stuff like that sometimes works.

Then there's sometimes an opportunity to create a brand ie a backpack for example is a pretty run of the mill product but if I get an alibaba suppliers to add a tripod strap on the outside now all the sudden its a camera backpack.

I completely agree about the Ali Express stuff. Not only is it completely saturated but the shipping times are ridiculous, nobody is going to put up with that and even if your able to get through one sale without a chargeback or refund nbody is ever comming back to buy more and ecommerce is all about recurring business. My ecom business has 56% return customers, that means more than half of my customers just come back, I don't have to continue to pay to market to them.