After a recent string of phone calls trying to convince me to “join the internet revolution” sell me a business opportunity known as a virtual mall, or online mall, I wanted to share with you five major issues with starting a “virtual mall”.
It's happened more than once, and they usually follow a similar formula. You receive a phone call out of the blue asking if you are interested in learning how to make some income on the side, or expand your current business. You go through a few qualifying steps, which includes making sure you have an internet connection, a credit card with a few hundred dollars worth of credit, and 1-2 hours per day.
You then proceed to move though a series of representatives, including a “short recording” that explains how easy it is to start your own virtual mall, and how there are millions of dollars of transactions being done each day by internet based businesses.
If you get high enough up the chain, you can talk to a supervisor, and if you hesitate long enough, they will give you various discounts or incentives. One time I talked a guy down from the original $800 price to $100, so that gives you an idea of how much these internet malls are actually worth. Doing research on these companies usually brings up very few results because they either simply don't exist, or are so unknown that they have no reputation at all.
In fact, because the target folks that aren't internet savvy, there are probably quite a few complaints that never get voiced simply because the person doesn't know how or where to post their complaint online.
Top 5 Reasons You Should Not Start A Virtual Mall
#5 High Fees, Low Quality Results
The fees associated with creating a virtual mall are often way out of proportion to what the website is actually worth. Creating a “mall” takes very little work these days. With the right knowledge, you could do it in less than an hour. With zero knowledge, you could have something comparable set up in a week or two of study.
Fees range from $100's to $1000's of dollars just for setting it up and getting products listed. I guarantee that there is no coding involved, and they are just cookie cutter websites that can be produced in minutes. The results are often shoddy looking, generalized stores that scream “just go to Amazon”.
#4 Not targeted
When you go shopping online, where do you go, Amazon? Walmart? These places have put years and billions of dollars into building brand names. They can have a generalized inventory because they are well known, and have slowly built their brand starting from something small.
Amazon started by just selling books. Walmart started with a single store in Arkansas, USA.
The fact is that most stores have a “niche” or a “target audience”. They sell one type of product, like baby clothes, motorcycle gear, or electronics. The most successful stores are also going to have a target demographic, like low-end, mid-priced, or premium products, and they may even go further with targeting people from a specific are, with a specific type of job, or a unique problem.
Malls have everything, for everybody. And the saying in the industry goes, “If you try to please everyone, you end up pleasing no one”
The salesmen on the phone will sometimes try to sell you packages based on how many products you can actually feature on your site. But they fail to mention the quality of these items, where they are shipped from, and who your potential buyers will be.
So you are purchasing a mall with no idea of what you are going to sell, or who you are going to sell it to. If people land on your site at all, they are not going to know your brand well enough to trust your site. After all, why by from an unknown online mall when you can just buy direct from the sellers website just as easily?
#3 Limitations on products you can sell
It does not cost money to add products to a website. It does not cost money to sign up for affiliation with other companies. But for some reason, I see a lot of places dividing their packages by how many products and companies you can promote.
Once your initial site is set up, adding a product is simple. The process varies depending on what type of website builder you have, but it's usually a few clicks, adding an image or two, text, and a link to the parent website.
If you build your own website, even a free one, you can promote UNLIMITED products. So why limit yourself and pay more for it?
#2 No training, or insufficient training
We're getting close to the #1 issue here, but not quite. If you are a newbie to internet marketing or selling anything online, you no doubt have questions. You will definitely get confused, frustrated, and run into problems.
However, as far as training goes, it usually consists of a few videos in the back end that were outsourced to a mid-range quality voice actor and some screenshots of what your site should look like. There is no step-by step. There is no training database.
These training videos, PDF guides, or instruction modules were no doubt created a few years ago. And since then, the world of online marketing has changed. I won't bore you with the details, but in a nutshell, what people were doing to their sites 2 years ago, could do some serious damage to your site this year.
It's very important to have up to date, accurate training. These companies make it very clear that their representative and even supervisors have very little knowledge of the internet marketing and online business industry. They are simply employed there to sell you a product, not teach you how to build your business.
#1 No Traffic
The number one issue with these types of businesses is that you simply can't get the content found on Google. Filling a website with random products you think will sell, without any content and without any marketing strategy is just not going to get you found in search engines.
Most likely your friends and family are not going to be able to consistently buy from your site, if they buy at all.
And I doubt that your social media following or email list is big enough to make consistent money (oh, you don't have those either?)
So with no brand, no search engine rankings, no budget for advertising, no social media following, and no email list, you will most likely make $0 regardless of what type of site you have and what products you are selling.
Bonus: Lack of Support
A HUGE issue with many of these online mall business opportunities is their support systems.
Some places guarantee that they have experts who will walk you through the process of setting up your site. They will say things like, you can call us any time (business hours), and we will take as long as you need to learn how to work you
I have seen various pricing structures like a one time fee of $600 for unlimited support for 3 years, or even that they will build your site and create content for you for a few months.
But in the same breath, their reps will hang up the phone when you ask tough questions. Their managers will not return your phone calls
Of course these are individual companies, and cannot represent all of them. But after reviewing quite a few and talking to about 20-30 of them on the phone, it's my opinion that the majority of these companies that cold call you to sell virtual mall opportunities simply do not provide the kind of support needed to actually teach you to make money with your site.
No one calls it a virtual mall, and no one buys from them. This is a waste of your time and money. If you actually are looking to make some money on the internet, I suggest you set some realistic goals and see how I make money with my blog to see if it's something you'd like to try.