When a business finds the right sales staff, it will see how sales can help it expand to a new level.
“It’s integral if you want to grow your business to a more substantial agency that you understand how to successfully ramp up a salesperson,” — Jenny Dibble, owner of SearchMarketMe.

PayPal is the undisputed leader in online payment service providers. Google has tried to build market share for its Google Checkout over the last two years but feedback from my customers and business partners is that Google Checkout is still not their preferred online payment mechanism.

Most other online payment service providers are limited in their appeal, and are used by specific niches of customers. For example, there are some payment providers for online pharmacy transactions and online betting transactions. These are large industries however as the legalities are not the same or favorable in all countries, therefore such payment providers are able to offer a solution that is needed by the companies in these industries.

Escrow.com deserves a mention. It is a very useful site for business transactions, and their fee is very nominal for the value of the service that enables totally unknown parties to conduct business transactions.

Overall, there is no serious competition to PayPal today. PayPal has built a large market share due to its easy payment sending and receiving options. On October 3, 2002, PayPal became a wholly owned subsidiary of EBay. Over the last 7 years, EBay has acted as the perfect growth platform for PayPal creating about 10 million of PayPal users worldwide.

PayPal’s total payment volume, the total value of transactions, was US$ 60 billion in 2008, an increase of 27 percent over the previous year. This $60 billion of 2008 represented nearly 9 percent of global e-commerce and 15 percent of US e-commerce. In fact, at an analyst day on March 11, 2009, eBay CEO, John Donahoe announced that PayPal could be a larger driver of revenue than EBay marketplaces business. So clearly, there is a huge demand for safe and easy online payment systems like PayPal, which has become the market leader with a big lead over the competition.

The economics of owning a popular online payment system are very attractive.

Online payment sites don’t pay interest on money held in the user accounts. A majority of active user maintain some working capital for day to day transactions. While the numbers are not available in public domain, we can do some rough math. PayPal has about 10 million users, and assuming an average money balance of 100 USD per user, that’s a billion dollars of interest free capital or float that PayPal maybe enjoying at any given time. Good acquisition by Ebay!

It is surprising that over the years, Amazon has not taken any major step in this direction to grow or acquire a payment system like PayPal. So where can competition come from? From social networking sites.

One of the major changes in the Internet landscape since 2002 is the rise of giant social networking sites like MySpace, Facebook, Twitter, and LinkedIn. Each of these sites has millions of regular users. And a site like Facebook can develop its own payment system and virtual currency, which makes it possible for a marketplace to grow. We already see hundreds of third party applications on Facebook, and many of them sell low cost items. A virtual currency can be a powerful solution. I believe Facebook is already working along these lines.

There is also value is trying to solve one specific problem of international trade – the problem of varying currency conversion rates. If a large payment site can create some form of protection against currency rate changes, by using its own virtual currency in the marketplace that could be a powerful innovation that can nurture and grow a wide variety of international trade. On this front, PayPal and EBay are best placed to make something possible. A virtual currency in a global marketplace is the next big milestone for online payments. It will take extensive collaboration with banks and financial institutions, and we will have to wait and see who will take up this big challenge.

About the Author:  Shankar AVSB is the Director of MyOrbit Online, a London based Internet business with over 100 websites in different industries. He closely follows Internet business and online payment systems for conducting international trade and has advised numerous companies in improving their online business. Shankar is also the CEO of 7Avenues Private Equity, which runs ventures in Retail, Supply Chain, Services and E-Business. He can be contacted from here.

Create a massive fall in the market large enough to trigger stop-losses typically set up at 5% drop, and then buy blue chip stocks at 30% less price before they recover, sell Put Options at 1000% gain, blame it all on computers and trading algorithms. Some person or some company somewhere has walked away with billions in profits after this event. It looks very well planned. This event was most probably an example of higest form of market manipulation, a bold master stroke, though illegal and unethical.

To find answers, we need to check the money-trail.
Who all bought millions of DOW 10500 Puts for pennies a few days back? Those Put options would have got sold at 10 dollars each, making billions of dollars. It is very unlikely that the organizer is within the US, otherwise the SEC/FBI can find ways to take back the money. The organizers are most probably hedge funds, outside the US, in offshore locations. The sponsors had enough capital, and NYSE/NASDAQ trading algorithm expertise, to make the initial 250 point dent, and then the market forces took over, pushing everything down in free fall.

To those who say that since the prices came back to pre-fall levels, and no real damage was done — they clearly are not traders or have market positions or investors who have put stop losses.  Many traders and brokerages got blown out of their positions because their stops were taken out after 5% drop in the Index.  Many futures and options traders squared loss making positions, and opened hedging positions, only to be caught in the pull-back few minutes later.  It was violent – a financial hurricane. Such extreme movement of stock prices has cascading effects on margin positions which impact other non-related trades, commodity positions and forex, because all these market are inter connected.

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“Once we accept our limits, we can go beyond them” – Albert Einstein

The above was one of his favorite messages, and we can trust Einstein to have thought through the various aspects behind his thought. There is great value in these words in every possible project and venture.

As we have pointed out in many previous posts, many businesses are not able to make sales and profits they deserve because there are gaps or holes in their business process; someone is letting ready prospects go away, while someone else is trying to sell to cold prospects; someone is not trying enough for repeat business, while someone is relying totally on that; someone is afraid of upcoming changes in their industry; while someone has not even thought about it!

This year, we will share numerous insights and learnings from businesses and professionals worldwide as they take on bigger projects, and make them successful. We plan to have at least 10 posts every month, so you will have a lot of new stuff every time you visit.

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The above ad is from the AIDS prevention campaign being run in Uganda. It was shared by Perry Marshall over the weekend. It stands out from the usual ads, and has an immediate on the reader because of its ability to directly address the target audience — middle aged men with the income and propensity for procuring teenage sex.

What makes this ad stand out? Some reasons I can think of are:

1. It is dealing with morals/values, where its possible to act differently in private from what we  accept in public.

2. It uses just a few words and that too as questions, which you will tend to answer within yourself.

3. The few words are supported by a carefully chosen image, which really delivers the full impact of the ad.

4. It puts you on the defensive; very few ads can achieve that. It makes you respond internally. So you are likely to remember it for some time.

These days we see hundreds of ads every day on the Internet and in print media. Our mind has been slowly getting trained to separate the signal (content) from the noise (ads). In the early days of the web, 1997 to 2000, there were not that many ads, and the technology behind them had no capability to geo-target the audience.

The above ad is a great example of a powerful ad.
See how you can use its structure for your own business.
- Shankar

According to marketing guru, Phillip Kotler, the mantra of marketing is creating, communicating and delivering Value to the Target market at a Profit.

Creating value for the product or service is called product management. Product management is creating or innovating products or services. For example P&G decided to make some funny thing on each Pringle (a potato chip), the scientist could not find a solution internally until they discovered cookie maker in Italy who printed funny things at his cookies. This is called open innovation or open technology used for product management which means ideas are taken from where ever the companies can.

Communicating the value is called branding or brand management. Brand managing or brand building means packaging a product or service. Branding means communicating a promise to the customer, creating excitement and interest about the product and differentiating it from the rest. The brand represents the company for what it stands for and inspires everything that the company does or acts. Brand comprises of an emotional element generally aiming for mind share and heart share of the customer. There is new direction now aiming for the spirit share of the customer. It is a share of something that’s little more than narrow to one’s own interest .It is about being caring and is appreciated for intending to care about the shape of the world. So according to Phillip Kotler creating an emotional relationship is more than limited to the persons own nurturing his or her ego.

Delivering value to the target customer is called customer management. Simply sending direct mails or messages to a database of customers is not customer management. Dealing with customer requires meeting/actually communicating with the customers and knowing them really beyond the data base. Customer database is best utilized to get help from the customer for co- creating product and the advertisement for the company. You are delivering value to customers when they are finding your products and services are seen as a great choice and good value for money/time.

So an effective functioning of Product management, Brand management and Customer management can give desired results.

In the short term, the conflict between inflation and growth always exists. As of now, there is no case for raising interest rates, at least till inflation is below 5%. The food price pressure will remain for the next 2-3 months.

Rangarajan sees price pressures due to inflation from growth, and oil prices will play a key role. 9% GDP growth for India is possible after the world economy has come out of recession in FY 2011-2012 by when the global trade will pick up.