This would be a lousy time to start a mass-market toy store such as eToys, but this may be a very good time to launch a site that offers children's educational software and books that support specific home-schooling curricula. Consumers understand now that there is wealth of specialized goods and services available on Internet, and growing numbers of these consumers are willing to buy from niche sites.

Trust remains a factor, just as service is still critical to Internet retailing, but some of these hurdles can be traversed by presenting a site that communicates expertise and then backs up that expertise by delivering on all service and security promises. A lot of trust can be gained by communicating expertise. A musician friend of mine buys dozens of harmonicas each year. Buying online from niche sites is only way to go when you want both a wide selection and a good price. So he goes to niche sites specializing in harmonicas. Within a few minutes, he can tell whether site owners really know products in niche. Once he ascertains a high level of knowledge, he is willing to trust retailer.

Not surprisingly, best harmonica sites are run from a family home. The service is high touch, and proprietors are quick to offer product information and any other help related to professional harmonicas. Inevitably, a relationship develops. This is territory best suited to Internet retailing. You can't get this relationship from a catalog, and you can't find expertise in a store. In world of finely-carved niche retailing, Internet remains a land of golden opportunities. It does requires considerable expertise, superb service and high security, but if you can deliver these three requisite qualities, you can avoid that nasty dot com flu.

Sounds easy enough. But often, there are visitors to your Web site that may be different from your traditional customers - and sometimes, you either currently offer or could create new products or services that they'd buy.

Thinking through all possible audiences for your site, and all ways in which you might interact with them is really crucial in creating your Web strategy.

Then, so is knowing who you expect to be looking at each page of your site, and what you want them to do. This might include requesting a catalog, asking for technical support, signing up for a newsletter, etc. Include clear text links and invitations to visitor - and make it really easy for them to contact you.

Too many pages online provide great content, and then just tail off into nothing. Don't let yours be among them!

3. Under-utilising e-mail: e-mail is a powerful tool when used appropriately (and an awful one when not!) It can be used for marketing, customer service, public relations, in-company memos, business research . . . and much more. Look at your real-world communications - could e-mail save you time and expense?

E-mail marketing can be done without costs of design printing, and postage associated with traditional direct mail. It's almost free of charge!

It can be used to send notices of new products, or upgrades to existing ones. It can keep your customers informed of news and events in your company, and around industry. If it's offering brief, valuable content, most of your contacts won't object to receiving it - although of course if they do, you must take them off your mailings. But, with a few subtly embedded links to key pages in your Web site, it can be a great traffic generator.

Your own database of your customers, prospects and other contacts is best place to start - and take every opportunity to nurture that. Ask visitors to your Web site to sign up for your newsletter, product alerts, or other materials. If you buy any lists, be very careful that they're bona fide and you won't be accused of spamming recipients.

And whatever you do, answer your e-mail! Lack of e-mail response is always one of biggest customer service complaints around e-business.

So, consistently mine your customer list. Send them targeted, relevant e-mails, and grow your business relationships electronically!

Let's say it again - Internet isn't going away. Today's challenge lies in understanding how to use it to maximise your market reach, optimise efficiency of your operations, and achieve best overall return on your online business investment.

Copyright, Philippa Gamse, 2000