Final: Business Plan

Executive Summary

Web Expressions is an e-business startup company focusing on today’s web trends in order to build, design, and enhance websites. We believe that with the capabilities of web and mobile technology, the creativity of web and graphic designs, as well as the progression in ecommerce business, our company has the potential to grow for many years. With our growth, we expect to establish our brand and associate ourselves to be a leader in the web service industry.  

This expectation will have profitable results with the right business plan, which follows. It highlights marketing strategies such as consumer targets, advertising, and payment systems.  Research and development plans are also detailed along with the possible risks that may occur. An outline of financial costs and a five year timeline of our predicted growth are also included.     
 

1. Business Description

Web Expressions offer web development, web design, and ecommerce services. We are a small web-based company made up of eleven highly qualified web developers, designers, and programmers. With each having at least 5 years’ experience, we work together to implement the latest technologies and express our love for innovative and creative business.

With web development, we build websites using the latest languages such as PHP, Drupal, Joomla, Ruby on Rails, and JavaScript. With smartphones increasing in sales, our company also focuses on the development of mobile web and applications. These development services offer cross-platform capabilities needed in today’s web advancements.

With web design, we create web layouts following today’s design trends. We also design logos to establish a brand image. Creating web and emails ad designs is also our expertise. All of our designs are created with the latest design software such as the Adobe Suite.  

With ecommerce, we help to analyze and suggest marketing techniques. We implement Google analytics to research web traffic and collect usage information. By analyzing these results we guide our clients to a more profitable approach in conducting their ecommerce business.

All of our services have been successful in not only meeting our customers’ needs, but also reaching prospective customers. With nearly 2 billion people viewing the web (Internet Usage Statistics, 2011), 54% in smartphone sales in the U.S. this past year (US Smartphone Staistics - Q1 2011 Overview, 2011), and 14.1% ecommerce revenue increase within our industry, finding customers is not an issue (U.S. Census Bureau E-Stats, 2010). Imagine, in 5 years, the thought of 2 billion internet users needing our services might not impossible.

2. Marketing Plan 

1. Customers: 

With our company just starting out and based in the U.S., our target consumers would be U.S. internet users, mobile users, and ecommerce businesses. Whether these users have a business or not, having them view our business online will allow for our brand image to expand. Based off the latest Internet World Stats, 77% of the U.S. population is internet users, which makes our consumer target close to 240 million users seeing as there are little demographic limitations because everyone uses the internet (Internet Usage Statistics, 2011). When it comes to smartphones, according to Nielsen wire, targeting the 18-34 age range would be the most beneficial seeing as they have the highest statistics in smartphone usage (Smartphone and iPhone Deomgraphics from Nielsen, 2009).  Last, ecommerce consumers can be easily targeted through small established stores looking to enhance businesses or current ecommerce stores needing a new marketing strategy.

2. Competitors: 

Gravity World and ACS Creative are two companies today that are leading in the web service industry.  They both offer similar services as ours as well as extra strategy and design services. Although these companies seem to have established their name and show a high quality of work, their consumer target has a small range. With Web Expressions, we are dedicated in serving nationwide via phone, email, chat, or video conference. However, with ACS, they are strictly for the DC metropolitan area (ACS Creative). The same goes with Gravity, whereas they are situated in New York, thus much of their potential business is limited to New York (Gravity World, 2010).

3. Advertising: 

Other than having already published our very own ecommerce website, we have already implemented email branding in order to catch clients through email correspondence. Our email brands are beautifully designed which link to our website. We have also established a Facebook group and with 500 million potential customers, it is a great choice in advertising (Facebook Ads, 2011). More known ad techniques would be to set up a Google Ad or a traditional published ad, especially in web magazines such as Web Designer Mag. All of these advertising techniques have great potential in gaining more consumers.

4. Pricing: 

Our services are individually priced such as iPhone application build, web design layout, and 6 month analytics, which range from a one-time fee of $199-$499. However, we promote our Expression Plans on our site to give the customers a bundled package of services based on their needs as well as increase revenue.

Our Expression Plans are bundled by our services.  For example, in our web development package, we offer a website build, an iPhone app, and a mobile web platform. In our web design package, we offer a 5 page web layout design, a logo, and an email brand design. Last, our ecommerce plan comes with 1 year analytics, 1 year advising, and marketing tools such as Google Ads setup. All these plans range from an annual fee of $199-$699.

5. Delivery & Payment: 

Since we are a web-based company, all of our services are delivered via web, either by email, chat or video conference. All of our services are paid by credit card payment electronic cash systems. We have implemented a well-known and secure merchant service for credit card transactions called Authorize.net. As far as electronic cash systems, we use the most popular and secure system, PayPal. These systems have encryption security, which prevent fraud, lessen profit losses, and increase customer service (Schneider, 2011).   

3. Research & Development

Today, we currently service an average of 25 clients per month. About ¾ of those clients purchase individual one-time services. The rest are long-term customers. Our average yearly revenue is at $90,000. However, within 5 years, we expect to at least triple our consumer rate, which in turn would require us to expand our staff. With a larger staff, we would need to establish a physical, home-base location.  

4. Risks 

The only risks we have identified are due to the growth of technology. As technology advances, our knowledge and skills must as well. This could prove to be costly in terms of consistent training and/or staffing. Also, along with knowledge advancements, there are likely to be more competitors that arise. If we cannot build our brand image within a 5 year time frame, establishing our business as a well-known web service could get difficult due to competition. Last, we have one legal worry to be aware of. Although we are skilled in building applications, we must be aware of patents and Apple restrictions so we do not face copyright or trademark issues.

5. Financial 

With web services, equipment and software are the most important aspects, along with knowledge. It is important that we finance in computer hardware such as MacBooks or PCs for our employees, which come with all the web features such as a webcam, mic, drawing pad, fast processor, high-capacity storage drives, and VPN service for secure internet connections (Schneider, 2011). We must also invest in web software and servers keep up with our workload. I would estimate all of this equipment and software at a little over $30,000. However, a $30,000 investment is manageable compared to potentially tripling a $90,000 yearly revenue.  

The next financial investment would be to establish a home-base, primarily in the Baltimore, MD area due to the majority of our developers/designers based in the area. We believe that renting an office space first would be the best approach in establishing our location. Renting would give us time to manage and sustain a physical location. It would also give us the flexibility of reevaluating a location if it proves to be unsuccessful. Most importantly, it lessens our financial strain with a lower cost compared to owning a commercial real estate. In researching some rental spaces in Baltimore, we found office space as low as $450/month, which had the needed space and quality (Executive Suites Baltimore, 2011). Overall, these financial costs will prove to be worthwhile once our company expands and continues to increase profit.

6. Time line

• 1 year--acquire needed equipment and software for staff, build brand image through advertising strategies
• 2 year-- double staff, progress in brand image
• 3 year--increase client average, double revenue
• 4 years-- expand staff by 25%, establish location and brand within web community
• 5 years--successfully established physical location and triple revenue

7. Bibliography and Appendices

(n.d.). Retrieved May 6, 2011, from ACS Creative: www.acscreative.com/web/web.html

Smartphone and iPhone Deomgraphics from Nielsen. (2009, Septemeber 20). Retrieved May 6, 2011, from BitBriefs: bitbriefs.amplify.com/2009/09/20/smartphone-and-iphone-deomgraphics-from-nielson/

(2010). Retrieved May 6, 2011, from Gravity World: www.gravityworld.com/digital/index.html

(2010). U.S. Census Bureau E-Stats. U.S. Census Bureau.

Executive Suites Baltimore. (2011). Retrieved May 6, 2011, from Search Office Space: http://www.searchofficespace.com/usa/office-space/baltimore-executive-suites.html

Facebook Ads. (2011). Retrieved May 6, 2011, from Facebook: www.facebook.com/advertising

Internet Usage Statistics. (2011, April 30). Retrieved May 6, 2011, from Internet World Stats: http://www.internetworldstats.com/stats.htm

US Smartphone Staistics - Q1 2011 Overview. (2011, March 6). Retrieved May 6, 2011, from SmartOnline: http://www.smartonline.com/mobile-2/us-smartphone-statistics-q1-2011-overview/

Schneider. (2011). Electronic Commerce, 9th Edition. South-Western.

8. Conclusion

According to the last E-Stats in the U.S. Census Bureau, Selected Service Industries like ours was last recorded to have made a total revenue of $146 billion dollars. The year before that was at $128 billion (U.S. Census Bureau E-Stats, 2010). Imagine, in one year, our industry increased its revenue by $18 billion. In five years, we could be a part of nearly doubling today’s revenue statistics. With the advancement of technology, our drive for creativity and better business, and the high demand of services in the web community, we are capable. However, as a start-up company, we need the support to build and the be known. We already have the foundation with our skills, but now we need the finances and management to create a long-standing structure. It is our belief that Web Expressions has the knowledge, strength, and quality to be built.    

Chapter 12: Planning for Ecommerce

E3. As manager of networks and computing operations for Fashion Land, a retailer of women’s clothing and accessories, you have seen the business grow from seven stores in Kansas City to over 100 stores located throughout the Midwest. Fashion Land’s marketing research team realizes that the majority of its target customer group— females between the ages of 15 and 35— are regular users of the Web. The researchers have asked you for help in developing an electronic commerce initiative for Fashion Land. Alone, or in a team assigned by your instructor, do the following:

1. Outline a business strategy for Fashion Land’s electronic commerce initiative. The outline should include a list of specific objectives and the costs and benefits of accomplishing each objective. The outline should also include recommendations regarding what to outsource and what staff should be hired.

Objectives:

1)      Build brand

a.      Fashion Land’s brand has the potential to enhance their brand image at a faster rate due to the capabilities of targeting its major customer group via web

·         Create a logo and slogan that to market and advertise

2)      Advertise

a.      Easier and more profitable advertising by publishing ads online instead of paper catalogs

·         Email branding

·         Google Ads

·         Distribution or Download of Web Catalogs

3)      Sell products

a.      Implementation of payment systems will increase revenue at a more productive rate

·         Credit card payments

·         Electronic Cash payments

4)      Enhance customer service

a.      Real-time help increases quality of business and provides customers with assurance in service

·         Customer Service Line

·         Email Representatives

·         Chat Representatives

5)      Improve inventory

a.      Online products are easier to track and manage based on profit sales

·         Easily edit product options

·         Provide tracking systems for product inventory

2. Prepare a memo that lists and briefly describes the major hardware, software, security, payment processing, advertising, international, legal, and ethics issues that might arise in the development of this electronic commerce site.

                First, Fashion Land must ensure trademarks to its name, logo, and slogan. Afterward, it will need a web service or web developer and designer that can publish their website. After the website has been published, it’s imperative that they maintain it so purchasing a company PC is a must. In creating the website, Fashion Land should invest in an SSL Certificate to secure transactions and provide business legitimacy. Transactions can be processed by using a Merchant and Electronic Cash system. Authorize.net is a well-known merchant system and PayPal is the most popular Electronic Cash system. Both systems have safe encryption software to prevent fraud. After the website has been established, Fashion Land can begin advertising by purchasing Google Ads or even establishing a Facebook Group and a advertising through Facebook Ads. 

Chapter 11: Payment Systems

E2. Bonnie Carson has owned and managed her gift and card shop in the Central Shopping Mall for three years. Business has been good, but Bonnie wanted to expand her business. A year ago, she hired a Web designer and built a Web site hosted by a national Internet service provider. Part of the monthly ISP fee for her merchant site includes the software needed to process credit card purchases. She has obtained a merchant account with a national credit card processing company. Bonnie’s Web- based business is beginning to pick up. She wants to provide more payment options to her customers and is considering a payment processing service such as PayPal as an additional option. Write a report of about 300 words in which you advise Bonnie on this. Identify at least three reasons that Bonnie should use such a service and at least three reasons why she should not.

PayPal Implementation Report—Bonnie Carson

I understand that you are expanding your business via Web and would like to implement a payment process system such as PayPal. I think that this is an excellent idea. PayPal is one of the most popular payment systems known by online shoppers today due to its popularity with eBay; therefore, the credibility of this system has already been established.

                For a small business like yours, PayPal will help lowering transaction costs as oppose to credit cards. With credit cards charging monthly fees as well as per transaction fees, the costs for transactions can get high. However, PayPal only has per transaction fees and are much lower than credit cards fees. This will help save your business money and could even allow you to reduce consumer prices, promoting more business.

                Another benefit of PayPal is that it clears payments instantly. Other payment options such as checks and credit cards have slow processing time due to more entities involved. With those options, the time for merchants, customers, and banks to approve payment make delays the process time. However, with electronic cash used with PayPal, authorization is not required. This electronic cash can also be withdrawn from your PayPal account at any time by check or direct deposit.  Having these quick and efficient transactions will allow for faster shipping times and increase customer service.  

                Customers will also be pleased by the security that PayPal brings. PayPal has successful payment surveillance software, which continually monitors PayPal’s transactions. This software searches for fraud patterns, which allows PayPal to react quickly to suspicious activities. The success of this software has shown with fraud rates below .5% versus credit card web and store transactions, which has a fraud rate of 1.13%. Having this type of secure processing system will be beneficial to earning your customers trust in using this system and gaining more profit.

However, be aware that are some drawbacks to a processing system like PayPal. Because it uses electronic cash, it is not easily traceable. This gives you no audit trail as well as puts you at risk for money laundering. Also, in the future, if you want to expand your business internationally, it could be difficult. Due to the lack of a standard in place for electronic cash, there is little success for it globally. Last, in order to accept PayPal transactions, your customer must set up a PayPal account. Convincing them to register account might be a hassle for them considering that they probably have at least a couple credit card accounts to keep track of already.

Although these drawbacks can make you hesitant to use PayPal for your business, there is still the potential to resolve these issues in the future. Right now, the creation of serial numbers for electronic cash is place in order to track it better. Also, it is estimated that by 2020, electronic transfers will jump 9%, which shows that the popularity of the system is growing. With the popularity growing, having consumers sign up for accounts will not be an issue.

RQ2. In about 200 words, outline the reasons that a consumer who owns a credit card might want to use an electronic payment system, such as PayPal, for an Internet transaction. In an additional 200 words, outline the reasons that a small merchant might want to use an electronic payment system in addition to, or instead of, accepting credit cards.

                Today, electronic payment systems such as PayPal have become more and more popular with internet web transactions. Some reasons to why consumers who own credit cards as well as merchants might want use an electronic payment such as PayPal would be due to its convenience, security, and low cost.

                Consumers who set up a PayPal account can easily pay merchants even if they do not have a PayPal account themselves. The transactions process immediately, therefore, merchants who wait for payment before shipping will ship products to consumers faster. For merchants, this promotes better customer service and higher chances of returning customers.

Electronic payment systems also process transactions more securely. This decreases the risk for fraud. Having this security gives both consumers and merchants the trust to support business as oppose to credit card transactions, which has a higher fraud rate.

Also, unlike credit cards, electronic payment systems such as PayPal have no fee to individuals. Credit cards have least an annual fee to consumers. With merchants, their credit card fees are much higher. They are charged per-transaction and monthly fees. Using a low cost system such as PayPal would not only increase business profits, but also have the possibility of lowering consumer prices.