Hind-Site on the Web : Expect Work, Not Miracles, if Taking a Business Online

Monica and Perry Lopez’s tiny salsa shop in Old Pasadena is a huge hit on the World Wide Web.

Their 300-square-foot Hot Hot Hot store can squeeze in only 20 customers at a time. But more than 1,500 people a day visit the store’s Internet address. Hot sauce connoisseurs in Canada, England and Japan order from them.

But instead of gushing about the opportunities for small businesses on the Internet, as one might expect, the Lopezes have plenty of warnings for entrepreneurs hoping there’s easy money in a Web site.

“If anybody tells you you’re going to make a million dollars doing it, walk away,” said Perry Lopez. “It’s not there yet.”

With all the buzz about the Internet’s ability to reach 30 million online consumers cheaply and swiftly, many small-business owners are feeling pressured to jump on the digital bandwagon. But marketing on the Internet takes time, dedication, money and work, online consultants say.

There’s the cost of starting a Web site and updating it regularly. And there’s the time it takes each day to answer electronic mail and process the U.S. and foreign orders that can come flooding in if the site’s a hit, said Jeannine Parker, past president of the International Interactive Communications Society.

In addition, a small-business owner with a Web site is competing against tens of thousands of other Web sites, some of them sophisticated multimillion-dollar productions.

“In the mad rush to get on the Web, businesses will call up Web developers not having thought through anything and not knowing what they want,” said Parker, owner of Magnitude Associates, a Santa Monica Internet consulting business.

The Internet brings in about 25% of Hot Hot Hot’s more than $50,000 in annual sales, Monica Lopez said. It’s a good showing for electronic sales but a far cry from the millions touted by some Internet gurus, said the Lopezes, who have been invited to tell their story at business conferences in New York and London.

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The Lopezes gave a lot of thought to going online, even before they opened their store in November 1993. Because both lacked computer and design know-how, they hired a graphics designer and enlisted a neighboring Pasadena business, Presence Information Design. The site (https://www.hothothot.com) opened in September 1994 at a cost of $5,000, typical for a small business.

Because the site must be kept running on a computer constantly, the Lopezes use Presence’s computers, paying the company about 10% of the sales generated, also a typical arrangement.

The Hot Hot Hot Web site, with its mix of bright colors, logos and graphics, mimics the decor of the shop on Delacey Street south of Colorado Boulevard, where rows of bottled sauces sit on painted shelves and Mexican paper cutouts lend a festive air.

“Online graphics at the time [1994] were slick, high-tech and marble textures,” Monica said. “We wanted ours to be very cartoon-like and fun, with personality and warmth.”

The Lopezes devised comical graphics of flaming heads to designate the piquancy levels of their bottles of liquid fire.

The couple wrote the descriptions for each of the more than 400 sauces they get from around the world. They change the Web site content at least once a month, and Monica spends two hours a day answering the e-mail the site generates.

“When we started the business, we had planned to open a second shop in the second year,” Monica said. “The Web was our second shop.”

When they started online, there were only 5,000 Web sites, Monica said. Since then, more than 300,000 have been created, 45,000 of them commercial. Word-of-mouth about Hot Hot Hot’s colorful site has helped it stand out from the crowd.

Perhaps even more important, salsa aficionados tend to match the profile of the typical Internet user--that is, they are men.

Small businesses going online need to consider whether their products will appeal to Internet users, Parker said.

Small businesses also need to consider how they will deliver their products once they are reaching people worldwide, Parker said. An order from England took the Lopezes by surprise. Their Web site automatically applied the domestic U.S. postal shipping rate of $4.50, which is half the international cost of $9. When the delighted British customer sent a huge second order, the Lopezes realized they were now running an international business and would have to refigure shipping prices on their Web site and find out how to ship to foreign countries.

Raven Rutherford, owner of Blk Bird Pies on Washington Boulevard in Los Angeles, faces a similar problem. Rutherford uses a van to deliver her homemade pies to individual customers and stores. Last year, she decided she could expand by creating a Web site.

But when a customer from Maine ordered pies, Rutherford belatedly learned she needed $2,000 worth of special shrink-wrapping equipment and heavy-duty cardboard boxes to ship her baked goods.

In addition, Rutherford discovered that maintaining her site requires her to spend time she can’t really spare writing copy and answering mail. As a struggling sole owner, she must find the wholesale customers, negotiate the contracts and bake the pies and deliver them.

For insurance broker Dana Justin Coates, the Internet has added $30,000 of new business a month to what had been an average of $50,000 in sales. Coates, 39, who specializes in insurance for small companies, went online in November for Arroyo Insurance Services Inc. in South Pasadena.

Coates said he knows of large insurance companies that spent tens of thousands of dollars on their Web sites only to have disappointing results; his $1,000 “plain Jane” site, he said, with no color or graphics, has succeeded thanks to constant daily attention.

“You have to come in, sign on and download your mail,” he said. “If you don’t make a commitment to do that, then you’ll fall down.”

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Tip Box

Small businesses that go online can increase their visibility through a variety of methods:

Using simple keywords in the home page text so computerized search devices such as Yahoo and Web Crawler will take users to the page.

Communicating with online chat groups and newsgroups to announce a Web site or changes to a site.

Aligning with other well-visited sites.

Placing an ad in an electronic mall with related products.

Placing listings in an online yellow pages or directory.

Designing a site of their own. Some business owners who did not create their own Web sites but chose a more passive online presence are beginning to regret having done nothing more than rent space on a list.