Tips & FAQs for running an Internet startup

There is an internet startup, which has a vertical portal, which plans to first concentrate on select few clients in the industry and expand to cover smaller players in due course of time. Let's say, the startup offers services like increased integration of producers, buyers and brokers in the industry ( e.g.: oil) so that the transaction costs in the trading process are reduced. there are also other services like market research and industry relevant information offered to the clients.

Questions & Answers:
1. How is such a product/ service priced?
Ans: Most imp. thing is defining your business & target audience as tightly as possible & then developing content keeping them in mind. I believe in the long run only a few horizontal portals will survive on the Internet & most of the survivors will be vertical portals or vortals (like or

The pricing is normally done on the basis of the savings accrued by the customer because of your service. It can be a percentage of that service. The pricing is the most difficult part as I think U will be
the first mover in the India web scene for such a service. Do some primary research on pricing through a questionnaire if possible.

2. What pricing strategy should we have which is robust enough to withstand competition?
Ans: In Internet business, you have to be the first, the best & the best known. If you take care of this everything else falls in place. For e.g.: Consider Amazon Vs Barnes & Nobles. Though B & N is a brick & mortar company in USA, they cannot just match Amazon on the Internet as Amazon has reached the critical mass. Competition on the Internet always happens in terms of better service & not based on lower price. Your customers would not leave you even if they are getting better price on other sites if:
a. You have the content which interests your target audience.
b. U have a service that keeps them coming again & again. A service which is automated & improved at the drop of a hat.

3. What other revenue streams can the portal have?
Ans: They will keep evolving over a period of time. Use technology to deliver a more focussed & targeted service. e.g.- helps its clients in short listing the candidates online.
a. Advertising- once you have a critical mass of eyeballs within a niche, U can sell media space to interested advertisers.
b. Any other related service- Possibly for a edible oil portal, one of the services U can think of is medical advice for heart problems as edible oil is one of the causes.
c. E-commerce activities - can be either b2b or b2c, selling of other related stuff online which might interest your target audience.
d. Auction - auction of commodities i.e.., b2b activities. U can become India's largest commodities portal.
Many more can be thought of once the content & service is in place like, you could create content for some other sites or off-line publications.

4. How do we decide upon a marketing strategy keeping in mind that the positioning that the start up has today might change?
Ans: I think most imp. thing for a startup is SPEED. If U think your effort is 60 % to your satisfaction level... go ahead. Never wait for it to reach 95 % satisfaction levels ... U might have lost the race even before entering one. Your strategy has to be flexible according to the changing environment & always focussed on the target audience. Your team should understand one thing very clearly, the very existence of this startup is for its target audience.

That's why U need to give as wide a positioning as possible within the niche. If your niche is the commodity about india's largest commodity portal, even though your first business may be that of oil. This gives U an opportunity to expand further. But do not spread yourself too thin or claims so high which cannot be supported by content, service or technology.

5. How do we generate traffic on the portal?
Ans: Most effective method even today is search engines .....
* Search Engines: But not many people have figured out HOW? U gotta do that. Each search engine has different ways of looking at sites. This needs research.
* Secondly, considering U may not funds to go for spending money on off-line media, use online media to the fullest.
* Go for banner exchanges/ link exchanges with the sites where U think your target audience visits.
* Advertise on the sites where you target audience may come.
* Use direct emailing technique, where U get email IDs of people registered with other sites & offer them something for visiting your site... some gifts or freebies.
There are more ways....

6. What are the advantages/ disadvantages of giving the portal free of cost to select clients (especially big players like an oil future exchange) ?
Ans: Advantage is you can use their names to get more clients.
Disadvantages are that people might perceive that U R a absolutely free site, but that's fine as far as U get good clients. Even started as a FREE site & now we are one of the few Internet Indian
startups who are making money. U need to prove yourself useful initially. For that U have to get as many relevant eyeballs as soon as possible.

7. What are the basic ingredients of any co-marketing agreements made with other portals/ agencies ?
Ans: The agreement should be non competitive. Only where there is a win win situation last longer. Agreements will be situation specific. The agreement should be for a shorter period, may be for
6months to 1 year time which can be extended further. (As Internet time is defined in terms of Internet months where, 1 Internet year = 3 calendar months). Similarly, U should also try to include exclusivity clause in the agreement. The service provided by the other party can become a major draw for your
visitors & should be exclusive to you.

Please use the Back button of your browser or click here to get back to CareerMosaicIndia