Launching an eCommerce - too expensive to build a brand?

13 replies
  • ECOMMERCE
  • |
First, a caveat.. Im new to the entire IM thing. Ive spent a lot of time researching all the different possibilities, info sites, software, etc. I think selling physical products through eCommerce is the best place to start for me.

So.. Ive settled on a product, researched the competition and the market, contacted dozens of suppliers through alibaba, and had some samples sent over.

I want to move forward with this, but here's my issue, and here's where Im hoping someone out there can provide some advice :

I want to create my own brand for this product. In my market (Canada), there are plenty of resellers, but only two established brands. And neither are that impressive. However, when I speak to suppliers, the lowest MOQ I can get for OEM (with my own logo) is 200 units. By my calculations, if I want to carry just 4 SKU's, I will have to pay over $25,000 up front.

I don't have that kind of capital. Maybe I could borrow it, but Im not willing to take on that kind of risk until I at least show I can move some product in my market. I want to start with smaller orders, but this doesn't seem possible if I want my own brand on the product.

So, my options as I see them :

1) Borrow a bunch of money and take a huge risk without knowing 100% that I can move these products.

2) Forget the brand thing, and become just another reseller, of which there are already many in my market.

3) Build a the eCommerce site with my branding, but sell "neutral" branded products.

4) Instead of offering multiple SKUs on my site, offer one, which would have my brand on it. This would be more affordable, but I worry this would make my website look like a bit of a joke.

5) Forget it, look for another market and another business model.

Option 3 seems the most attractive to me. But I don't really know if this is feasible. Yes, I can make smaller orders of quality "neutral" products, but won't my customers wonder if they're just getting cheap knock offs? Would this just devalue the brand? Is this really branding at all? Do smaller startups do this successfully?

Im lost, a bit overwhelmed with all this! Does anyone have direct experience in this area that would be willing to chat with me a little bit?

Sorry for the long post, thanks for reading!
#brand #build #ecommerce #expensive #launching
  • Profile picture of the author malia
    Having done it both ways here is my advice:

    1- without knowing what you are selling, see if there are other ways to get your logo on the product. With some creative work arounds it can often be done.
    2- Don't borrow that much money at this stage. It's always best to use money when you need to grow, not start, as you will have the burden of paying off debt while you're trying to kick things up.
    3- Develop the branded website and then as funds allow, and as you have "proof of concept" move into the branded product. This means you CANNOT select a generic domain hame Can your name pass The SMILE & SCRATCH Test? - Eat My Words | Eat My Words which is a sacrifice between having an exact or partial keyword match domain and building the brand.
    4- Know that when you build a brand, it's not as simple as having your logo on it (I actually have a branded line with no logo on the product, as crazy as that sounds), but you have to go hard core with differentiation and positioning, if you really want to establish the brand. It pays off in the long run--- believe that!
    5- Recommended reading: The Blue Ocean Strategy (book) and study solid brands in industries outside of yours
    {{ DiscussionBoard.errors[8032547].message }}
    • Profile picture of the author cortsmith
      Thanks for the thoughtful response.. A few things there to consider, for sure.

      Can you explain what you mean by your statement below? Im not quite sure I follow..

      Originally Posted by malia View Post

      Having done it both ways here is my advice:


      3- Develop the branded website and then as funds allow, and as you have "proof of concept" move into the branded product. This means you CANNOT select a generic domain hame Can your name pass The SMILE & SCRATCH Test? - Eat My Words | Eat My Words which is a sacrifice between having an exact or partial keyword match domain and building the brand.
      {{ DiscussionBoard.errors[8032981].message }}
  • Profile picture of the author Jon Patrick
    There is another risk you haven't mentioned, which is the risk that a foreign supplier will rip you off when you place an order larger than a sample piece. It happens a lot.
    {{ DiscussionBoard.errors[8034845].message }}
    • Profile picture of the author cortsmith
      Originally Posted by Jon Patrick View Post

      There is another risk you haven't mentioned, which is the risk that a foreign supplier will rip you off when you place an order larger than a sample piece. It happens a lot.
      Yes, I realize this is a risk (However, the point of this post was really to get advice from people who have done their own branding). Im trying to mitigate that risk as best I can by talking to Gold Suppliers that have been 3rd party assessed, and really talking to them lots before I order anything. Obviously, is a huge concern.. None of the suppliers in my niche that Ive talked to will take Escrow payments for anything larger than a sample order.

      I guess T/T is my only option then really?
      {{ DiscussionBoard.errors[8035944].message }}
      • Profile picture of the author maso7
        Sorry, no advice but I lean something with everything I read.
        {{ DiscussionBoard.errors[8036328].message }}
  • Profile picture of the author malia
    3- Develop the branded website and then as funds allow, and as you have "proof of concept" move into the branded product. This means you CANNOT select a generic domain hame Can your name pass The SMILE & SCRATCH Test? - Eat My Words | Eat My Words which is a sacrifice between having an exact or partial keyword match domain and building the brand.
    Develop the branded website and then as funds allow, and as you have "proof of concept" move into the branded product.-- If you don't have the funds to "private label" the product, develop a strongly branded website to sell the product from. This way, the product appears to be of the same brand as the website without the logo on the product. Once you have proven the concept (proven that it sells) then you have the money, and sales history to move into the private labeled product.

    This means you cannot select a generic keyword matched domain, like bestbluewigdets.com, because that's bad for branding (and has downsides for SEO and PPC), you actually need a memorable brand name that people will search for. Use that link to the smile and scratch test to help you pick a strong brand name. Even though keyword domains have an SEO advantage, they do not have a branding advantage, so it is a tradeoff.
    {{ DiscussionBoard.errors[8036375].message }}
    • Profile picture of the author ryshark
      Originally Posted by malia View Post

      Develop the branded website and then as funds allow, and as you have "proof of concept" move into the branded product.-- If you don't have the funds to "private label" the product, develop a strongly branded website to sell the product from. This way, the product appears to be of the same brand as the website without the logo on the product. Once you have proven the concept (proven that it sells) then you have the money, and sales history to move into the private labeled product.

      This means you cannot select a generic keyword matched domain, like bestbluewigdets.com, because that's bad for branding (and has downsides for SEO and PPC), you actually need a memorable brand name that people will search for. Use that link to the smile and scratch test to help you pick a strong brand name. Even though keyword domains have an SEO advantage, they do not have a branding advantage, so it is a tradeoff.
      Agreed. This is exactly what I was thinking.
      {{ DiscussionBoard.errors[8036702].message }}
    • Profile picture of the author cortsmith
      Right.. And I guess that's the question for me. Say a customer buys a product from cortsfavoritewidgets.com.. the product arrives and everything is as it should be, but the product doesn't have the Cort's Favorite Widgets logo on it. Does this damage the brand? Would people think that's a little strange and wonder why it doesn't have any branding? Or do most customers even care/notice that sort of thing?

      I should perhaps mention that my niche is a relatively new product, and it doesn't seem as if consumers of the product are very brand loyal.




      Originally Posted by malia View Post

      Develop the branded website and then as funds allow, and as you have "proof of concept" move into the branded product.-- If you don't have the funds to "private label" the product, develop a strongly branded website to sell the product from. This way, the product appears to be of the same brand as the website without the logo on the product. Once you have proven the concept (proven that it sells) then you have the money, and sales history to move into the private labeled product.
      {{ DiscussionBoard.errors[8036723].message }}
      • Profile picture of the author ryshark
        Why not just brand your website name, then when you figure out what sells best brand that item with your private label...
        {{ DiscussionBoard.errors[8037363].message }}
  • Profile picture of the author malia
    Say a customer buys a product from cortsfavoritewidgets.com
    Again, that's more of a keyword based domain than a brand domain. So, it's unlikely they will remember where they purchased it. A brand is like Zappos, Amazon, Woot, ThinkGeek. Amazon isn't called JeffsFavoriteBooks.com and Zappos isn't Tonysawesomeshoes.com. See the difference?

    The other problem is when you go generic, people can copy and you have little grounds for stopping the infringement. Generic descriptors are not trademarkeable (it's considered "merley descriptive" and not available for trademark protection). Thus if you have cortsfavoritewidgets.com and I start curtsfavoritewidgets.com... I can do that, you know.

    Would people think that's a little strange and wonder why it doesn't have any branding?
    This really depends on what the product is. I can see that for some products it would matter (because a brand name on it is expected) and for others it would not.
    {{ DiscussionBoard.errors[8037725].message }}
    • Profile picture of the author cortsmith
      Bad example by me! I do know what you mean, though.

      Thanks very much, I appreciate the response.
      {{ DiscussionBoard.errors[8037916].message }}
  • Profile picture of the author ChristinaT
    You can actually get pretty creative when it comes to branding. Start by branding your website and domain name. Then create a logo for your business. I had adhesive labels printed with my logo and website address which I used to put on several of my packaging materials including gift boxes and paper bags. Depending on what your product is, you might even consider applying labels with your logo to your product. If that's not an option, consider packaging the product with tissue paper and sealing it with your company logo. It's all in the presentation and branding of the product. I packaged all of my products using brown and orange to match the colors of my logo and website. I have a friend who is a graphic designer so the design work didn't cost me anything. When starting out, you need to save as much money as possible, especially when you haven't tested the product with the marketplace.

    Good luck!
    {{ DiscussionBoard.errors[8038266].message }}
  • Profile picture of the author papeter
    Have you thought about using a DROPSHIPPING service for your product? This gives you the opportunity to test your market before you actually buy your product direct from source.
    {{ DiscussionBoard.errors[8089244].message }}

Trending Topics