Opportunity Magazine: The New Frontier

Entrepreneurs Enter Cyberspace

Article featuring internet dive-travel entrepreneur and social networking pioneer Oscar Braun.  Reprinted from 1997

Go To Oscar Knows Website

     Not too long ago people cringed at the thought of working on computers.  Baffled by the Internet, they pleaded, “Just go away!”  Now though, Bill Gates is a household name, and words like “gigabit” and “download” glide off the lips of laymen, and professionals ignore multimedia at their own peril. Shrewd small business people too are recognizing the importance of the Internet and embracing it, especially for marketing their products and services.  “The way of the business marketing future is on the Internet”, proclaims Bob Hilton, vice president of Information Services.
Indeed, Microsoft’s Gates isn’t the only entrepreneur profiting from the Internet’s growth. Why, there are computer hacks coast-to-coast, from San Francisco’s Silicon Valley all the way to New York City’s Silicon Alley. And smack down Main Street U.S.A., savvy surfers are using the Internet in their bedrooms to rake in cash.
The Internet, particularly the World Wide Web portion , has been heralded by its proponents as the greatest marketing tool conceivable by man, able to reach a global audience both quickly and cost-effectively. Millions of potential consumers surf the Internet, and there are over 40 million pages on the World Wide Web to discover. Small businesses are finding it to be a uniquely valuable medium, because it enables them to spend a pittance to reach consumers worldwide.
As people flock to the Internet, entrepreneurs are conjuring up all sorts of creative ways to feed the appetite of a society that increasingly communicates electronically. Here’s but a taste of the opportunities and opportunists in cyberspace:

Discs in Overdrive:

     Video Direct Corp. embodies the type of company that’s thriving on the Internet: it’s young, aggressive and chockfull of products that the average cyberspace surfer breathes for. The Lon Branch, New Jersey company distributes educational and instructional videos and CDROMs, offering approximately 8,000 different products on everything from academic studies and music instruction to travel.
“Our products really are perfect for the Internet”, says Peter Heumiller, president of Video Direct. “We’ve been besieged by requests for the discs and videos.” That demand is partly explained, he says, by a study from Forrester Research, which found that 14 percent of all products sold on the Internet are computer programs and educational and instructional videos.
Indeed, the Internet was initially created as an educational, rather than a commercial tool. Back in the 1980’s, the Department of Defense set up the Internet to provide interconnection of its information resources and researchers. Many Net surfers now are attracted by the academic material provided by those with commercial interests.
“It makes perfect sense,” says Heumiller of the success of his company and the like-minded ones. “People who are Internet users are information seekers. That’s why they’re on the Internet in the first place.” Ethan Schneider, the company’s marketing director, concludes, “If you are selling informational products, it only makes sense that they are going to be attracted”.
Heumiller points out that another advantage of marketing on the Internet is that a business is able to instantly update customers on its new products and services. “Products become discontinued, or prices change. New products come out every day,” he indicates. “We can constantly bring the evolving world of information products to consumers.”
The company has bloomed since 1993, when Heumiller notes, it was only a wholesale distributor, offering a business package to people who would purchase the company’s catalog and distribute its products. Now it has a common home page with its distributors, who can use the company’s site to sell products and advertise their own businesses.
“We eventually see our Internet business becoming the main focus of what we do here,” says Heumiller. Although the company’s Internet catalog was just introduced last April, by October of last year, 15 percent of the company’s retail sales were generated off of sales on the Internet, according to Heumiller. And he says, “That’s really just getting going. I would project that it could be as high as 5- percent or more in 12 months.”

Oscar Braun founder and CEO of Oscar Knows, December 1996

Go To Oscar Knows Website

Diving Into The Net

     Once you’re equipped with a marketable product of service, the secret to selling it is to advertise your Web site and then tantalize customers who discover it. And just how do you accomplish that? Oscar knows.
Yes Oscar Braun, an entrepreneur who established the company, Oscar Knows, can teach a thing or two about designing Web sites and advertising on the Internet. Braun has set up a search engine on the Net that receives 10,000 hits (visits) per day from scuba diving fans.
But let’s backtrack a bit. Braun didn’t get where he is by spending years studying computer science and striving to work for IBM. “I’m primarily a Smith-Corona typewriter guy,” he said recently from his ranch in Half Moon Bay, California. Over the last 20 years that he was in sales and marketing, Braun was a scuba diving enthusiast on the side, even traveling around the world on dive trips two to three times a year. “It’s been my passion,” he says.
What started as a hobby soon became a cyberspace business. “I had been reading some articles about this Internet explosion,” recalls Braun. “And I had never really gotten involved with the hands-on working with a computer. I had never been on the Internet or the World Wide Web or anything.” But after a little research, he says, “It seemed like this was a way that I could get involved with international travel without being forced to leave my ranch.”
Like Video Direct, Braun plunged onto the Internet with a slew of information to offer. In fact, before he knew even the first thing about the Internet he served as a virtual encyclopedia for friends seeking global information on diving. “I thought I would like to be some type of central clearinghouse or directory for people to come to get information on anything to do with scuba diving,” says Braun. And so in December 1995, the Internet Database for scuba diving aficionados called Oscar Knows was born.
The biggest test for Braun, he quickly realized, was to draw viewers to the Web page. “You’re out there among millions and millions of sites,” he explains. “So your first real challenge is: how do they find me?” Braun deftly chose to entice avid scuba divers with an image that would immediately comfort them. His website displays a logo that’s red with a white stripe going through an “o.k.” symbol. The international dive flag colors, he notes, are red with a white stripe diagonally going through it, and the diving symbol is an index finger touching the thumb that divers use to signal underwater to each other that things are going swimmingly.
But how could Braun get divers to see his Web site with these two internationally recognizable icons in the first place? He couldn’t just pray they’d find it. “If the Web site doesn’t have any valuable content and it can’t be found, it’s a waste of money,” says Braun. Web sites must be advertised.
So in February of 1996, Braun says he made his most important strategic move: he approached Yahoo!, the popular Web search and index company, and bought the contractual rights to the words “scuba diving” on Yahoo!’s Internet database. Now if anybody in the world does a word search on “scuba diving” on Yahoo!, the Oscar Knows banner pops up immediately and surfers are directed to the entrepreneur’s own site.
Braun’s been captured by the Internet’s charms. “This is a wonderful way to play and make money doing it,” he rejoices. His site is generating boatloads of interest, and because he’s turned a hobby into a business, he says, “The vast majority of the discussions that I have with people are about things that I love to do.” Now Braun understands all the fanfare surrounding the Internet. “It’s technology that can be fun, educational, intimate and very profitable,” he says, adding, “It provides, in two words, total freedom.

The Alternatives

     Jim Daniels of Smithfield, Rhode Island, also took a belated interest in the Internet, but now serves as further proof that the medium can offer a little something for everyone. While agreeing that small companies need to have an Internet presence and that they promote their business, Daniels believes there are cheaper ways than the customary one. He doesn’t market on the Web, he markets via E-Mail.
In his manual, Internet E-Mail: Beyond the Basics, Daniels explores the advantages to marketing on the Internet without going onto the World Wide Web. Entrepreneurs can market on the Internet without spending thousands of dollars to have a Web site constructed for them, he explains. If they do choose to market on the Web, he says, they can use the readily –available software to build their own Web site. And they can cut costs by concentrating on the text – rather than the glitz – of the site, he claims, because some consumers don’t have the patience to wait for graphics to build up.
Daniels champions marketing via e-mail, a less orthodox method than Internet marketing, partly because it works for him. The entrepreneur, who didn’t jump onto the Net until February of 1996, advertises his manual in four on-line newsletters. Interested consumers purchase it by e-mailing him. He also sends a complimentary subscription of his own newsletter, BizWeb E-Gazette, via e-mail to people requesting it. On the newsletter, Daniels sells classified ads to other companies – usually 20-25 of them each week.
In just his first four months, Daniels’s solo company, JDD Publishing, has sold over 500 manuals, and the Biz Web E-Gazette has netted over 10,000 subscribers. After several months of working 40 grueling hours per week at each a telecommunications job and his fledgling Internet business, Daniels has gained enough Internet business to shed his day job. “Things have been taking off so fast it’s tough!,” he exclaims.

Netiquette

     Although consumers are snatching up his publications, Daniels is cautious about how he drums up business. Indeed, while there are different ways to succeed on the Internet, veteran cyberspace marketers agree you must adhere to some basic rules.
Daniels sends a free copy of his BizWeb E-Gazette only to those who request it because unsolicited advertising on the Web is a no-no. “Hard sales are really taboo,” agrees Schneider of Video Direct. “It’s just against Internet etiquette.” Daniels advises against “bulk e-mail,” or sending large amounts of advertisements to prospective customers via e-mail.
Schneider indicates that there are designated commercial sites on the Net where you can advertise, like on your home page or at shopping malls (Internet locations at which several businesses agree to sell their goods). But in areas where people don’t expect consumerism, like in news groups and forums, he says you shouldn’t advertise blatantly. “If you do,” he says, “you are going to suffer repercussions.” If you are “flamed,” for example, then Internet surfers have become so incensed at your in-your-face advertising that they send you e-mail messages “until your computer blows up basically,” says Schneider.
Just remember that as of now the Internet is primarily a medium through which to exchange information, not to peddle products. Daniels limits advertisements in his newsletter to 25 per week in order to keep the publication content-oriented.
Schneider points out that there are ways of advertising in a subtle manner. For example, he explains; say you find a chat group at which people are talking about golfing vacations. If you write an article for the group on golf that is of value, “somewhere embedded in your article, you say, ‘By the way, I have some other very useful information on golfing equipment for anybody who might be interested. And if you’re interested, e-mail me at…’” In this case, he says, you’re not making a hard sale, you’ve offered people information that interests them, and you’ve given them a way to find out about your own products.
While remembering proper “Netiquette,” it’s vital that you not be too bashful in your marketing techniques. “When you build a Web page, people won’t know about it unless you market it,” says Daniels. “People don’t stumble into Internet sites,’ agrees Heumiller. “A good Internet marketer will list his site in search engines, in list serves and in new groups, and link it all over the place.” Schneider notes that optimally you should create an attractive interactive Web site. But rather than spend “hundreds of thousands of dollars to do that,” spend money on an Internet marketing campaign. “Having a Web site is really no different that having a 900 number,” says Schneider. “If nobody knows about it, nobody is going to call.”

Small Businesses Thrive

     By following the basic guidelines, the Internet can be a great way for small businesses to grow. On television, large businesses can get much better exposure than small businesses because they can spend millions of dollars for prime-time ad space. But on the Intenet, you can set up an attractive Web site at a relatively inexpensive price. And you can save money by working right out of your home on your laptop, and reach people millions of miles away. “You can take a small business and become global by being on the Internet,” says Schneider. “Any guy from his kitchen table could become a global business.”
Furthermore, small businesses may be able to close a sale more easily over the Internet than large businesses. Dana Shultz, a certified management consultant for Dana Shultz and Associates, believes that “people will pay $20 for a pair of pants from L.L. Bean on the Internet,” but they won’t pay for high-ticket items like automobiles. Many consumers are wary of spending top dollar via computer. While higher-priced items can be marketed on the Internet, to actually sell them Shultz believes that businesses must use more traditional mediums. On the other hand, small businesses will find consumers willing to purchase their offerings.      “People will buy on-line,” says Shultz. “There’s been no doubt about that.”
The task for small businesses remains to entice the millions of potential consumers surfing in cyberspace with a product of service they need. On-line shopping will be a $6.6 billion business in 2000, up from the $518 million being sold online in 1996, according to a Forrester Research report.
Entrepreneurs are scurrying to partake in the wealth. “It’s the most incredible information medium there is,” says Braun of Oscar Knows. “If you have an entrepreneurial spirit, it’s a wonderful frontier,” he adds. Forrester also projects that the U.S. Internet services market will explode from $1,4 billion in 1996 to $30 billion by the year 2000. The company model, says David Goodtree, director of Telecom Strategies at Forrester and author of the report, “predicts that by 2000 an astounding one-third of all businesses and 25 percent of households will be on the Net.”
Ignoring the Web is no longer a luxury the small business person can afford. “I think if you are in a small business today and you are not on the Internet,” says Schneider, “you are going to be left behind.”

Noted Sources:
Forrester Research, http://www.forrester.com
The Internet Society, http://www.isoc.org
JDD Publishing, e-mail:JimD@JDD-Publishing.com
Oscar Knows, http://oscarknows.com
Video Direct Corp., Ph:908-229-6996, http://www.totalmarketing.com
Yahoo! http://yahooinfo.com