Zimbabwe has come a long way in terms of getting online. Sure we are not completely there yet and there is a good argument that a lot of our advances have been by no doing of our own but the progress we have made cannot be taken away from us. Conducting business online, even though WhatsApp is somewhat the norm in Zimbabwe. I guess you can say we have adapted with what we have. As we forge on in the world of being online and eCommerce it is foreseeable that a shopping or comparison website could become quite a hot property going forward. Let’s discuss how you can go about setting up this business.
One thing the internet has brought about is the ease of access to information. WE have if we seek access to more information about anything that has ever been available to the ordinary person in the past. This is great but has a downside as was discovered in the Trevsky Jam studies. Tversky offered people free samples of jam in a supermarket to encourage them to buy. What Tversky varied in the experiments was the number of options available. What Tversky found was that the more options people had the less likely they were to choose. This is the problem of the internet also known as paralysis of analysis. This is why you will find that businesses that have been most successful on the internet are aggregators rather than specialists. Aggregators combine information from various sources. You can view something like YouTube or Google as an aggregator.
What you will create is a website that aggregates information about options available to people for certain products they desire. Let’s look at the example of someone looking for insurance. Let’s use the example of medical aid to keep it simple and relatable. There are obviously many options, perhaps too many for the mind to easily hold for comparison. The website would display options available for people to choose from with a rundown of costs, features and benefits of the various plans. This allows the user to view all the options available and even filter the search by chosen characteristics including pricing or benefits.
Where it works
Insurance is a very good example because it is standard insurance practice to pay commissions for the referral of customers. There are of course many cases where this is standard practice but also cases where the idea could still be lucrative without commissions. You could easily apply the idea to groceries, fast food, cosmetics, medical supplies, clothes and more. Zimbabwe is a country where shopping around is very important to consumers and customers. The same could be applied to services for both individuals and businesses. Something like bank account options or accommodation work very well for this.
Collaboration with suppliers
To make this business work one thing you will have to get a grip on is your collaboration with suppliers. Where the suppliers are willing to offer commissions for customer referral this isn’t much of a problem. However, this isn’t guaranteed in all businesses and all industries. The value of your business to users is in how well you provide information about the options. So you will need to stay on top of this and the best way is through having close relationships with suppliers. Fortunately for the person who tries this, all businesses want more customers.
Where is the money?
I’ve already mentioned referral commissions and this is the best source of money if you are fortunate enough to get into an industry where the practice is prevalent. There are other ways to make money from this sort of business. You can make money directly from users by asking them to pay an access fee. This can be a once fee per search but may not be feasible in all cases. Another good source of revenue is advertising. With the right focus, you have a website that will receive a lot of site visits from those who are looking for something specific. That’s a good spot for advertisers. You can choose to go for an advertising program or handle advertisers yourself.
To give you a complete understanding of the business idea I will give three examples that you can have a look at to get your mind going. These will help you to get your head around the practical aspects of the business.
As the name suggests this website helps people search for flight options. Have a look at it as it is really well put together.
Hippo is an insurance aggregator that helps people search for various types of insurance including health, life, car, home and more.
Trivago is an international aggregator for hotels and accommodation options for travellers.