Online Business: Beating Your Competitors

Today competition is tough.
We have companies like Microsoft, Yahoo, Google, EBay, Amazon, and a whole slew of companies, many of which came from the 1990’s.

It used to be normal to mark up prices quite high on software and hardware, every company making millions or billions of dollars through quality products and services. But it seems like the times have changed. Today, it is really difficult to provide a quality product and make good money from it. Why? Companies like Google have come along and taken the lead with a new form of money-making.

Advertisement and Marketing.
This seems to be the new trend — who can provide the lowest cost product yet still make a good sum of money from it somehow. How do they do it? Again, advertisement and marketing is the sure fire answer to this problem.

Take a look at Google. They provide almost all their services for free, and only have a few products in which they actually charge money. Yet they are one of the Fortune 500 companies of today.

Exactly what do they do?
It seems Google has provided services in which benefits virtually all parties who participate in it. It’s a win-win situation! Take a look at Google Adsense and Google Adwords. Google Adsense allows people who participate in it to sign up, add an ad banner to their website, and earn money. The ads on those banners provide Google with money as people who participate in Google Adwords pay Google to receive traffic. Google is the mediator and takes some of the revenue from the Adwords participants and gives the rest to the Adsense users.

Now, if Google can provide quality services for a low or even free cost, there will be millions of people running to them for such offers. With this many people Google can get an increase in participants on both AdWords and AdSense generating them even more money. It’s that simple! Well, of course, a lot of planning and marketing is involved behind the scenes, and it has to be done just right for it to work.

So you ask, how can I beat my competitors?

Simple answer, but difficult task.
The answer lies in providing quality services and products in which have out-beatable prices that your competitors can’t match. Of course, this is easy, but you’re asking “How the heck am I going to compensate for my outrageously low prices?”. Marketing and Advertisement! It takes a unique and creative idea, and perfect implementation to make it work, but as you can see, the payoff is quite large.

Take FreeIpods.com for example. They are making a great deal of money, how? You may think it is crazy that they just “GIVE” away free Ipods. Well, it really isn’t free. First of all, you have to sign up, refer five others, and sign up for one of their advertiser’s deals. Of course, referring five people is just a part of a pyramid scheme that multiplies the amount of people they drawn in, but how does the advertising work? Well, since they force you to sign up for one of their advertiser’s deals, the advertisers don’t generally charge you, but they make sure you have to cancel their offer within a certain timeframe or you WILL be charged. They know some people will not think about this and accidentally forget, and be charged. Also, I believe that when you signup for a free ipod, you are giving them the right to sell your address to advertising agencies who will send you spam through your snail mail. Another thing is that the company KNOWS not everyone will fill the requirements of referring five friends and getting them to all do the same — which will cause people to be advertising their website for FREE.

Now, FreeIpods.com is a bit gimmicky in the sense a lot of people aren’t to happy about their address being distributed to other advertising agencies or getting charged on their credit card because of something they forgot about. But that is just yet another example of such techniques being used to generate revenue.

So what am I saying exactly?
The times have changed and the methods for making money are no different. Creativity and a flawless system implemented smoothly is the key for out-doing your competitors.

It seems as if Microsoft is even starting to see the light, much later than they would like of course. If you haven’t already heard, Microsoft is making plans to provide free versions of their software — even the Windows Operating System itself is being considered.

A quote taken from a CNET article states:

“Even as Microsoft readies a host of new ad-supported online services to battle rivals, the software maker has been mulling a plan to offer free, ad-supported versions of some of its desktop products, CNET News.com has learned.

Although no specific plans have been made, executives within Microsoft are examining whether it makes sense to release ad-supported versions of products such as Works, Money, or even the Windows operating system itself, according to internal documents seen by CNET News.com.

As Web advertising grows and consumer revenues shrink, we need to consider creating ad-supported versions of our software,” two Microsoft researchers and an MSN employee wrote in a paper presented to company executives earlier this year. The document was prepared for one of Microsoft’s twice-yearly Thinkweek exercises, in which Chairman Bill Gates and other top executives gather to consider potential new avenues for the company to follow.”

The article can be found here.

Now how exactly is this going to help Microsoft? Creating free versions of their software allows people to get to know the companies products and take a liking to the software. With advertisements Microsoft can generate revenue to make up for the loss of free software, and perhaps gain more users for their software as many will end up paying the price for ad-free software. If they can find a way to implement the advertisements in such a fashion that doesn’t disturb users, perhaps they could use this new system for further products or services in which can overall benefit their company. Providing software at a free or low cost will keep Windows users loyal as they will see no reason to switch over to using other software that is free, lessening the competition all around.

[b]Final Thoughts[/b]
If you’ve read and understood this article, and these ideas haven’t even come into mind before you read this, this should be quite enlightening. How will things be in the future? With so many competitors trying to out-do the others, companies are forced to lower their prices, and that is where a bit of creativity and an ideal system comes in. Think about this when you think about marketing your next product or service.

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About This Author:

Martin Lemieux is the owner of Smartads. We help business owners to increase their marketing efforts online and offline. Today’s Topic “Pay Per Click”.

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