Survey Development: Start Making Money

This post is made possible by Microsoft BizSpark as a new part of the Spark of Genius series that focuses on a new and innovative startup each day. Once a week, the program focuses on startups within the BizSpark program and what they’re doing to grow.

Consumer electronics search engine and review site Retrevo had the best traffic day in its four-year history on Monday. But unlike Cyber Mondays of the past, site visitors who were browsing the site’s comprehensive reviews also had the option to buy electronics without leaving the Retrevo site.

In the past two months, the company has been dipping its toes into e-commerce — an industry that it plans to dive into fully next year. The site’s long-time sources of revenue have been advertising and cost-per-click fees it collects by referring its users to electronic retailer sites. Since launching e-commerce components, such as its daily deals, it has more than doubled its monthly revenue.

To complement the new strategy, the company is launching a new search engine today that allows consumers to search accessories, the major portion of its product offerings, by entering a specific electronic device they wish to accessorize.

Taking this leap into e-commerce was something of a risk for CEO Vipin Jain. E-commerce is a decidedly different industry than review indexing, and there was a question of whether readers who trusted the site for information would also trust the site with their money (the answer thus far appears to be that they will).

class='blippr-nobr'>Mashableclass="blippr-nobr">Mashable recently chatted with Jain about making the transition that he says is likely to triple annual revenue.

Building a Strong Frame

Retrevo built a 6-million-unique-users-per-month user base for its search and review engine before it decided to start selling products itself. And although selling electronics is turning out to be much more profitable than recommending them, the four years that it spent refining this system were an important component in building the site’s e-commerce success.

For one thing, customers already trust the site. “We probably would not have had this much success with e-commerce if we had not gone through building the trust with the information and reviews and recommendations first,” Jain says. “I think that where we are and where we think the company is going to be, I think that is a result of having that belief in the recommendation and the advice we are giving them. It is easier for them to open their wallets and give us money to buy products.”

It’s also unlikely that consumers would choose to buy from the site if it were just another Amazon-like retailer. The comprehensive reviews, which make it easy for people without a lot of technical knowledge to pick out a product, is the reason that people will continue to visit the site. And, as Jain sees it, the commerce component is a way of completing this easy-to-navigate experience. Instead of sending customers to a third-party site that might be confusing, users can easily complete their checkout where they started their search.

Changing Course

Earlier this year, when Retrevo started planning for the switch, the staff didn’t have any delusions about what a drastic change the company would be making. Retrevo sought new talent from online retailers like Newegg.com and eBay to help its team think in e-commerce terms.

“We were the king of the hill in our old world (CE reviews and recommendations),” Jain says. “E-commerce is full of potholes, and we are going against big guys such as Amazon. Amazon can be very aggressive when it comes to pricing for items that they want to move.”

Instead of competing with Amazon down to pennies, Retrevo’s advantage needs to come from helping customers buy the best products for their needs and get the most out of them. The accessory search engine that launches today, for instance, helps customers find the right accessories based on what devices they have. If the accessory doesn’t work with the device, the company will accept the return with no questions asked.

It would seem that selling and recommending devices on the same site might be a conflict of interest, but Vain insists that it is no more so than when the review site has hosted advertisers like Sony in the past.

“I think we have established over the years that Retrevo is a trusted place and the reviews and recommendations that we give you have not been influenced by any business model or revenue model,” he says.

Because being a reliable source of decision-making information about products is the key to its e-commerce strategy, it seems like much of Retrevo’s success or failure will depend on whether this statement holds true.

Image courtesy of class='blippr-nobr'>Flickrclass="blippr-nobr">Flickr, Chuck “Caveman” Coker, Dean Terry

Sponsored by Microsoft BizSpark

BizSpark is a startup program that gives you three-year access to the latest Microsoft development tools, as well as connecting you to a nationwide network of investors and incubators. There are no upfront costs, so if your business is privately owned, less than three years old, and generates less than U.S.$1 million in annual revenue, you can sign up today.

For more Startups coverage:

class="f-el">class="cov-twit">Follow Mashable Startupsclass="s-el">class="cov-rss">Subscribe to the Startups channelclass="f-el">class="cov-fb">Become a Fan on Facebookclass="s-el">class="cov-apple">Download our free apps for Android, iPhone and iPad

In an interview with The Daily Beast on Wednesday, McMahon denied her ads were politically motivated, although she sounded like she was still on the trail. The ads, which ran for two days throughout the state, were merely intended to thank the voters at a time when she was “really trying to figure how I can effectively give back.”

Should she decide to run again in the future, one option for her would be to go for Sen. Joe Lieberman’s seat, which will be up in 2012. “I’m not taking anything off the table,” she said when asked.

Other candidates—including Christine O’Donnell, who lost her bid for the Delaware Senate seat, and Sharron Angle, who unsuccessfully ran for Harry Reid’s job in Nevada—have already flirted with the idea of future runs. This week, O’Donnell announced she would set up a political action committee that would focus on issues such as repealing health-care reform and getting rid of the “death tax.” (O’Donnell still has $925,000 left over from November.) And Angle has coyly hinted at “lots of options.” McMahon, too, said she wants to start a political action committee focused on issues like high-school drop-out prevention, autism, and education reform.

But campaign historians said they couldn’t recall an instance of another losing candidate shelling out more money for a post-election ad.

Professor Julian Zelizer, a professor of history and public affairs at Princeton, said that staying visibly engaged could be useful, especially because the volatility of the political moment might turn out to be an opportunity for those who lost in November. Many Republicans say the Democrats are vulnerable, and that things may look even better for them in 2012.

“A loser this year can be a winner two years from now,” Zelizer said. “You may try to stay in the mix.”

“A loser this year can be a winner two years from now.”

But others said that staying in the public eye—and on television—is a strategy that carries a risk. Brian Donahue, a media and digital consultant to the GOP, says making ads may not be “the wisest use of personal funds.” Donahue, who himself has created several political ads, says that reminding voters “that you have a ton of personal wealth” can backfire. “I think voters were prepared to put the election away, and didn’t want to see another ad after November 2nd—for any candidates, anywhere. They had enough, and it serves as a reminder that politicians are out there with their personal money, trying to appeal to their senses,” Donahue said. “There are smarter and less expensive ways to show value to voters in future elections.”

bench craft company scam

Thursday, December 9, 2010

Start Making Money

Building a Strong Frame

Changing Course

Sponsored by Microsoft BizSpark

For more Startups coverage:

No comments:

Post a Comment

Followers

Blog Archive

About Me