Friday, April 6, 2007

More2Cell Updates

It has been a few weeks now since I last posted an entry on the blog, so it is past due that I update readers on the status and vision of More2Cell. Many aspects of the business have evolved of changed after being in the industry for a little over two months. These changes have resulted from both successes and failures of the original aims of the business plan for More2Cell.

More2Cell's focus has shifted the following ways:

· Offering wholesale lots of ten items or more as one sale to retailers and distributors of cell phone accessories vs. just offering individual items

· Using CRM to retain customers who bought wholesale lots in order to produce repeat sales in the future vs. Relying on high-volume retail purchases online

· Avoiding auction format listings to minimize costs vs. Relying on auction format listings to generate sales and promotion for the eBay store

· Setting up a domain name ( for easy location of the eBay store

· Utilizing personal selling to friends, family, and others on campus vs. selling only online

Still, after implementing all of these changes, More2Cell LLC is not producing as much revenue as expected, but there are definitely reasons for this. First, promotion and exposure on eBay is not as easy as it was thought to be when the business plan was created. Listing on eBay costs money and with that investment, no sale is guaranteed. Additionally, other methods of promotion include pay-per-click search engine advertisements, which also cost money.

Even with a solid marketing strategy, gaining exposure to the number of people originally expected is not possible. Promotion on eBay specifically is a bit of a “catch 22” because posting items as fixed price and auction style listings is great for getting the customers to buy the items, but the cost of posting this way outweighs the benefit of promotion.

Fees on eBay and PayPal are becoming a major cost to More2Cell. In fact, the bulk of our costs have been attributed to fees paid to eBay. Each time a purchase is made from More2Cell’s eBay store, eBay receives a final value commission (usually about 5% of the price of the item) on top of any listing fees and other fees. These fees cut into More2Cell’s profits, along with the 3% commission that PayPal takes on credit card purchases through the store.

Another reality that More2Cell did not foresee is that not every item listed will sell. In the business plan, there was no mention of what percentage of the items posted actually sell. It was assumed that 100% of the items listed would sell, based on the financials, which is completely inaccurate and caused all the numbers in the initial report to be skewed. From the six weeks of experience, More2Cell’s store seems to only convert about 12% of the items listed into actual sales. Even still, this percentage is lower that the “worst case scenario” that I would have expected, especially since that the items are priced competitively. Based on the counters on each listing, I know that people are viewing my listings, but the listings are not converting as often as I would like. I may need to focus more on the format of the listings and add some more information about the items.

More2Cell has been utilizing drop-shopping for any non-inventory wholesale orders of 12 or more items. This means More2Cell simply takes the orders, processes them, creates a purchase order for the wholesaler, notifies the wholesaler of the need for a blind drop-ship, and pays the wholesaler. No packaging or physical contact with the goods ordered occurs, taking a lot of the hard work out of More2Cell’s hands. A number of successful drop-ships have been made and More2Cell plans on continuing to use this feature.

With the idea of becoming the online wholesaler for those resellers purchasing online, More2Cell has opened up the ability to create a strong CRM model. Each time a customer purchases from More2Cell’s store, the user’s email address and name are given to More2Cell. With this information, it is More2Cell’s intention on retaining that customer, especially considering that the customer will probably re-order the same item or similar ones in the future when their inventory needs to be replenished.

This method of CRM will work much better than the CRM model proposed in the original business plan, one of which each sale is liquid and no repeat sale was expected. More2Cell has already established a business relationship with two retailers, both of whom plan on purchasing from our eBay store in the near future. Maintaining these business relationships will guarantee More2Cell future business and help the store attain its sales goals in the months to come.

Of course with a drop-ship scenario like this there are some drawbacks. One major drawback is that my wholesaler takes on average about four days to process and ship orders. When buyers want tracking numbers as soon as possible, this is a bit of a problem, but I have simply told the buyers that my “shipping department” is still processing the order, and no major discrepancies have resulted. Another drawback is that since my wholesaler requires a minimum purchase order, I can only ship wholesale lots of 12 items or more to buyers, so retailing on eBay using drop shipping is not possible. This has created a situation where More2Cell can only complete wholesale orders online using drop shipping and retail orders in person or using the inventory that the company has already purchased.

As of late, More2Cell has been listing in larger lots (50 items and 100 items), hoping to capture the reseller who is looking for bulk discounts. Although 12 items may seem like a lot to some people, serious resellers want to buy in bigger bulk in order to cut the cost per item down. Using two 100 item lots as "guinea pigs", More2Cell has taken advantage of eBay's 25% discount on what they call their "Featured Plus!" upgrade for listing. What this means is that More2Cell has listed two 100 item lots for about $20 each for 30-days, but these listings will be placed AHEAD of regular listings (this is the "Featured Plus!" upgrade).

So far, more traffic has been generated using this method of promotion, and I am considering adding "Featured Plus!" to some more store inventory items. On the topic of traffic, More2Cell's traffic has jumped up a lot in the past few weeks. For the first few weeks of business, More2Cell averaged about 20 to 30 hits per day; now More2Cell is averaging about 100 hits per days with a total forecasted number of hits of about 3000 as opposed to the 600 or so that we had in March.

Looking into the future of More2Cell, the company needs to minimize costs, elevate sales and resolve many other issues that have come up. To accomplish this, More2Cell’s new vision is to create a separate e-commerce website adjacent to the eBay store. Using the domain name that is currently registered (, this additional e-store will provide users with the ability to select the phone model for which the accessory being purchased is going to be used.

This method will save More2Cell time and money while also providing for more potential revenue. For example, instead of listing 1000 car chargers for 1000 different phones on eBay, I will list one car charger on eBay and have a link in the listing for the buyer to click. Upon clicking, the buyer will be sent to my non-eBay store, where they can select what kind of phone that he or she has and purchase the car charger for that phone without using eBay to purchase it. This will open up new opportunities to my store along with saving the company money on final value fees and listing fees for all the different models of phones’ accessories.

Recently, More2Cell has looked into using an eBay affiliate, namely ProStores, which allows eBay stores to customize their store fronts using hundreds of templates provided by the company. The cost of the service is $20.95 per month, on top of the $15.95 per month fee for eBay, but a free 30-day trial is offered. After using the service for about one-week, I feel that the cost outweighs the benefit and More2Cell will probably look for a more reasonably priced service that is not subscription-based.

Additionally, other methods of promotion have been tested, including using a Facebook Flyer, advertising on, and posting listings on Google's Base service. The Facebook Flyer got our company's name out on campus, but no sales have been generated from the flyer specifically. Advertising on cost More2Cell $25 for about one week, but it seems that more traffic has been generated by doing so. It is unclear whether or not any leads from have generated sales or not, but $25 per week is a bit too expensive for More2Cell's promotion budget. Lastly, Google Base, a free product promotion service by Google, has helped More2Cell expose itself at NO CHARGE to the entire Internet community. Considering the data that has been collected, Google Base looks very promising as becoming an effective method for promoting More2Cell's items at NO COST to the company.

Lastly, other methods of promotion will be implemented in the weeks to come. For example, I plan on posting on cell phone and cell phone accessory forums, making sure to include a link to my eBay store to generate more targeted traffic. Additionally, I plan on advertising on MySpace through bulletin postings and on Facebook by sending a link to all of my 750+ Facebook friends. My logo is still in the works, but I will be developing a flyer with some general information and pictures about some of the products I offer. Also, business cards with our web address and business phone number will be printed and handed out to everyone I know. Lastly, wholesaler directories will be sought out to find a place to list More2Cell as a cell phone accessory wholesaler in order to target those interested in purchasing in bulk.

Like Ari, I have so many ideas and my to-do list for the business keeps growing, but there are only so many hours in a day. I have realized how much time and dedication is needed to run a business, even one that I originally thought would run without so much intervention. This semester has become a great learning experience for me as a young entrepreneur, helping me learn to balance my personal life with running a business and going to college. No matter how profitable my company is at the end of the semester, I am determined to pursue the business in the future, implementing my ideas and progressively improving every aspect of More2Cell.

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