Case Studies

Working the Web

Small businesses report that whiz-bang features aren't nearly as important as focused online marketing, optimizing search engine results and providing the content customers are looking for when they get to your Web destination.
This story appears in the June 2006 issue of BizTech Magazine.

Gone are the days when a business could get by with a bare-bones outpost in cyberspace just to alert would-be customers surfing the net to its existence.

Internet behemoths Google and Yahoo have garnered attention recently for sexy Web applications such as interactive maps with scrollable satellite images that users manipulate with a click of their mouse. But such whiz-bang features of consumer-oriented giants aren’t necessary to get your Web site noticed and to boost e-commerce revenue. Instead, successful small- to medium-sized firms say providing highly specialized functionality and content, conducting focused Web updates and optimizing sites to appear in search engine results aid in driving new sales, as well as retaining and growing existing customers.

“I’m not sure we’re so much sexy as [we are] persistent in keeping up with the latest trends and things like search engine optimization and e-commerce marketing,” says Kathleen Webb, co-founder of HomeWork Solutions.

The Sterling, Va.-based firm provides payroll and tax compliance services for families who hire nannies and other household workers. Webb says one key to keeping the company top of mind with new customers is analyzing and optimizing how its sites rank when users of popular search sites type queries such as “nanny” or “childcare.”

Webb launched the company in 1993 with her partner, Alan Heilbron, before the widespread use of the Web. But “better than three-quarters of our revenue is driven directly off the Web now,” she says. Much of that growth is due to optimizing her sites to score search results and other online marketing initiatives.

“We’re a niche, and as a niche it’s very expensive to reach your customers through a broad-based media, because there are so few of them out there,” she says. Nannies account for only 5 percent of childcare nationwide. And people with children under 6 years old are another small sub-segment of the reading, listening and viewing public, she notes.

Search for Results

A more cost-effective way is to modify your Web site so that it ranks high in relevant search results on popular sites such as Google, Yahoo and MSN. Such efforts, known as search engine optimization, or SEO, by practitioners, tend to shift as the popular search engines modify their formulas for ranking relevance. Yet the key remains building Web pages rich in relevant keywords and phrases that are most likely to be used as search terms by people looking for the products and services you offer.

When search engine Web crawlers index sites, they not only use keywords to rank relevance but also the number and quality of other sites linking to yours as well as listings of your site in reputable online directories. Businesses should create directory descriptions of their Web sites and submit them to the major Internet directories, such as Yahoo, and dmoz.com, as well as relevant vertical directories like Findlaw.com and Realtor.com.

These techniques for optimizing organic or natural search engine listings are typically the least expensive component of broader search engine marketing programs that can include paid placements in search results, such as Google’s Adwords program and Yahoo’s Sponsored Search. Under these pay-per-click programs, links to your Web site are displayed at the top or along the side of a page that displays search results, and you pay for the ad only when the user clicks on your sponsored link. The cost of such programs varies widely and is somewhat unpredictable, because the placement of those links is awarded by blind bidding to the advertisers willing to pay the highest price per click.

At Petz Enterprises Inc., a 60-employee firm that provides tax preparation services and software to professional tax practitioners, less is more when it comes to the Web. Petz Enterprises runs TaxBrain.com, an online tax preparation and filing site for consumers, and avoids bulking up its site with heavy client-side gee-whiz features because they slow Web performance.

Two years ago, after surveying its customers’ technology usage, Petz discovered that it still had a large number of dial-up users. As a result, the company performed a major overhaul of its TaxBrain site to eliminate unnecessary data transfer and make the server-based applications as efficient as possible. The result pared the site to about 20 percent of its previous size.

“Our focus is to [simplify] the client side to be as universally usable as possible. We don’t find that the consumer marketplace is particularly current. IE 4 is still being used,” explains Leroy E. Petz Jr., the firm’s senior vice president of technology and chief technology officer.

“What we’ve seen from a marketing standpoint is that our conversion rates on our Web site tend to be a lot higher now that the applications run faster and are more responsive,” notes Craig I. Petz, the firm’s vice president of corporate marketing and sales. “It’s cool to have videos and lots of flash and ActiveX controls, but you immediately start cutting into your audience when you put those things into your Web application.”

Constrained by what it can implement on the client side of its applications, Petz Enterprises relies on generous bandwidth for its Internet connection and plenty of server horsepower in its data center, which currently has about 30 servers, including those devoted to backup, redundancy and application development.

“Absolutely maximize your IT spend in terms of how much back-end technology you put in place and what your capabilities are to service customers to get the maximum RIO,” advises Craig I. Petz. “We’ve found that we’re better off overbuilding the back-end and allowing there to be excess capacity in the system, rather than trying to keep the costs down on the back-end and inhibiting customer interactions.”

Once you drive traffic to your company’s Web site, you’ll need to make sure that those potential customers have a reason to stay put and tell their friends about your products or services.

“There are some really easy things that small businesses can do to improve the effectiveness and efficiency of their Web site,” Webb advises. “They need to offer real content and real functionality to their customer base.”

Hired Help

HomeWork, for example, launched its first Web site, 4nannytaxes.com, 10 years ago and two years later launched 4nannies.com, an online jobs board and referral service for nannies and other household help. It offers a variety of utilitarian tools, such as paycheck and tax calculators, downloadable tax forms and others that keep its clients coming back to its Web sites, as well as informational podcasts and Weblogs, or blogs for short.

“On our tax site, clients can calculate a paycheck for their employee. They can download a W-4, so that when new employees start, they can collect their information. They can order a background check on a person online. They can report the wages that they’ve paid to their employee in a secure members area [of the site] and know that three days later out in the mail is going to come all the paperwork that they need to complete their tax returns,” Webb explains.

HomeWork spends several thousand dollars per month on Web site enhancements, “and it’s worth every penny of it,” Webb says. Its blog, podcasts and other online marketing initiatives such as a Refer-a-Friend discount program promoted on its Web sites have largely replaced the monthly $20,000 to $25,000 HomeWork Solutions used to spend on advertising in newspapers, magazines, cable TV and elsewhere.

CEO takeaway
Strong Web sites boost revenues for any small business, but keep the following in mind:
• Let customer needs drive your efforts. Just because it’s trendy doesn’t mean customers want or can utilize the latest whiz-bang feature.
• Interactive features and simple enhancements, such as specialized calculators and “Refer-a-Friend” capabilities can engage customers and drive new business.
• Creating community and useful content among your customers can attract new business and build loyalty.
• Online marketing, especially for small businesses serving narrow market niches, can save a bundle over expensive traditional advertising and marketing programs.
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