Info on typical ecommerce life cycle wanted

[carju1]

Anyone know where I can get any info on the typical life cycle of a typical on-line shop. You know the type of thing 80% growth in 1st year 20% in 2nd 40% if PPC used etc etc.

Web shops have been out there long enough now that somebody must have done a study and produced the sort of general info I'm after. I know from my experience what can/does/should happen but I'd like more 'unbiased' info if possible.

Thanks in Advance

Julian

[bj]

I think we're all interested to hear this, if such data exists.

[blitzen]

This sounds like the type of data that you have to pay for. Did you check DMA (Direct Marketing Asso)? http://www.the-dma.org/
Check that site and let us know what interesting things you find. It links to
http://www.thedirectmarketingsearch.com/

Or hoof it to the local business college library to look in journals (most professional journals require a fee for online access).

[edhan]

Originally Posted by bj

I think we're all interested to hear this, if such data exists.

Yes. This sounds great! We all would like to know more about it if exists ...

[mikeewart]

I don't know about a study but from personal experience, over the last 4 years, we have had growth of about 90%, 60%, 40% and right now we are tracking at 45%. The big jump in the first year had to do with some changes we made such as leaving PayPal and going with a regular merchant account.

We have spent virtually nothing on marketing, $25 - 30 a couple of years ago on google adwords and that was it. We have had terrific luck and are ranked #1 or 2 in most of our key words, even over the manuafacturers in most cases.

Hope this helps.

Mike
www.CubanFoodGuy.com

[bathgems]

In the first year the owner works like three people and takes home little or no money because, even if successful, he likely increases his inventory and markketing to grow.

In the second year the owner works like two people and takes the salary of one. He thinks about hiring someone but then there goes his salary. Tensions grow.

In the third year he takes on the employee and if smart, works on marketing to feed his new overhead monster. If not smart, he does everything himself muttering about why others dont do the work like he does.

In the fourth year there is terrific revenue but if he is still doing the work himself then the employee expense is bleeding his profitability. He fires the employee and vows to keep it small and keep it all.

At some point, hopefully, he reads the e-myth on how to be a real entrepreneur and not just self-employed.

Best regards,

Steven B. Pollack

[blitzen]

Originally Posted by bathgems

In the first year the owner works like three people and takes home little or no money because, even if successful, he likely increases his inventory and marketing to grow.

In the second year the owner works like two people and takes the salary of one. He thinks about hiring someone but then there goes his salary. Tensions grow.

In the third year he takes on the employee and if smart, works on marketing to feed his new overhead monster. If not smart, he does everything himself muttering about why others don't do the work like he does.

In the fourth year there is terrific revenue but if he is still doing the work himself then the employee expense is bleeding his profitability. He fires the employee and vows to keep it small and keep it all.

At some point, hopefully, he reads the e-myth on how to be a real entrepreneur and not just self-employed.

Hear! Hear! Well said. I've met too many people wanting it [success] dropped in their laps and fast rewards. They fail within the first year or go bankrupt later thinking they aren't failing.

Yes, the great majority of "profits" should, indeed, be put into marketing during the first years.

The step beyond is the big one that will tell it all.

[carju1]

Well after much searching I found bits of info here and there but nothing as a whole. So I ended up taking bits and stats out of a few reports and then having to write one large section specific for the clients industry section.

I'm surprised that there is nothing out there but as someone else said its probably partially a case that the reports only exist if your prepared to pay for them.

[brian.mark]

It makes a difference if you know SEO, understand SEM, and can do other marketing. It makes enough of a difference that there is no "Normal".

We're going on year 8 and had 80% growth last year. Most online businesses never make it past year 3, so we're atypical.

I think the reason you've never seen this study is that there is nothing typical about an online business. Some go to $1B in 4 years, while most are shut down.

Brian.

[brander]

I have to agree with Brian.mark on this one. There really are too many variables involved to really make much of a case study on it. That is not to say that maybe somewhere someone hasn't done so.

It seems as if taking into account all the variables would make such a case study very challenging.

Consider that all these things and some others would need to be factored in:
Target Market and Demographics
Marketing Strategies Employed
Product Demand
Product Quality
Website and Store Usability Factors

Not to say that it would not be beneficial to understand online store life cycles, I am sure it could be.

I like the idea that online stores are successful when they fill a niche well and reach their target markets. If an ecommerce operation is not doing both these things well, then "typically" it will be toast before too long.