Hitting PayDirt on the Internet
by Bonnie Morrow
Amateur geologist Michael Cohan has found his own special vein of ore - not in a hillside, but on the Internet.
Cohan, a KooteNet customer, mined slightly less than $100,000 in gross revenues in 1997 by selling out-of-print books on geology and other related sciences. About 75% of his present sales result from the on-line catalogs that he maintains on his web site, with the other 25% coming from his printed catalogs, which he still sends by traditional mail.
In 1995, when he began using the Internet, his sales increased 30%, followed by another 30% increase the next year. In fact, his business was barely breaking even until he started using the Net.
"It will someday be economically feasible for me to drop the printed catalogs entirely," Cohan said, whose business is called GeoScience Books. He noted that he is getting more customers through the web site than through print advertising, and has found his Internet customers are more intent on purchasing books than his mail order customers.
Using the Internet was initially his customers idea. "My customers were bugging me. They'd ask, When are you going to get e-mail? It would be so convenient for me," Cohan said.
When Cohan surveyed his customers, 25 % said they would use e-mail, which he calculated would save $600 a year in postage. He hired a professional to set up his page and teach him how to maintain it, and noted that he interacted with him extensively to obtain the type of site he wanted. With an increase in Internet customers, Cohan said he now saves a minimum of $2,780 in annual postage fees that formerly went to mailing out catalogs.
Cohan, 49, calls himself a frustrated geologist. He became hooked on geology as a child when the road in front of his house was paved. The crushed gray limestone used for the road base contained iron pyrite crystals known as fools gold. To Cohans 9-year-old eyes, those crystals were real gold. "Every day I ran home from school as fast as I could to pick out the stones with gold. It was just too cool for words," he said.
Soon his pile of rocks in his back yard was bigger than the road crews' pile. To Cohans disappointment, his father made him pick a few favorite rocks and haul the rest back.
Cohan was studying geology in college when he was drafted into the Army during the Vietnam conflict. After his duty, opportunities in geology appeared bleak. He chose to become a physicians assistant, and worked 20 years in the field.
But Cohan has always collected rocks. Now, however, his pile of geology books which includes 35,000 titles, is bigger and richer in pay-dirt. Cohan attributes much of his success on the Internet to capitalizing on a niche market.
"I am the definition of a niche market," he said.
Some sample titles from his latest catalog illustrate his niche and show just how specialized his business is: "The Pleistocene Deposits in Warren County, Iowa," published in 1911, "The Constitution of the Silicates," published in 1895, or "Ore Genesis A Metallurgical Interpretation/An Alternative to the Hydrothermal Theory," published in 1948. Obviously, these are not titles that attract a general audience.
Cohan only maintains about 1000 customers. They consist of professional geologists, academic institutions, government agencies, teachers, and students. In addition to North America, he sells books to customers in 28 other countries.
While Cohan has found the Net to be perfect for a niche market, he explained that it is not an effective media for the sales of common goods that can be purchased anywhere. "You can't sell items that people can buy at the strip mall," Cohan said. The Internet provides access to the broadest market possible, which allows specialized markets to flourish at minimal cost. Cohan's costs included the $600 in 1995 for a professional to set up his web site, and the ongoing monthly Kootenet subscription fees of $35.
Cohan also attributes part of his success to his exposure on the web in the right places. "The geological community discovered me early," he said. He noted that he has thousands of direct links to his site mainly through the web sites of universities and geological organizations. Cohans site also provides a multitude of links to professional geology associations and other geological sites. When he established these links, he requested a reciprocal link from their site back to his.
"A lot of people think you can do business on the Internet by spamming the world. People hate that, and it drives customers away. The trick is to be found," he said.
Cohan does not hold a high opinion of web listing companies that charge $50 to $100 a month, and claim to deliver great exposure. "Virtually all of the come-ons that you run into on the Net are shams," he said, noting that you can often list yourself, for free, with better results.
This is done on the Internet by accessing the search engines and registering your web site. Each search engine has a utility program for this. Cohan also registers each individual page of his site to increase his chances of being found.
Getting found also requires the right key words, which are looked at by search engines. Engines search the web site name, the content of the page, or source code words, Cohan explained. For better coverage, Cohan lists his source code words on an inconspicuous place on his web site.
Cohan strongly recommends using a local Internet provider rather than a national server such as America On-Line (AOL.) Local providers offer better customer service and come without the ads and junk mail.
In fact, Libbys local Internet provider, KooteNet, drew Cohan here. "The major attraction in moving to Libby was that KooteNet impressed me immensely," he said.
Cohan began his business in 1990 with 4,400 titles and ran it from his home in Missoula. When he decided to expand his business, he found costs to rent or buy commercial property there to be prohibitive, so he searched western Montana for a more suitable location. He moved to Libby during a blizzard in December 1996, and set up shop at 319 Mineral Avenue.
Cohans business also brings pay-dirt to Libby. His revenues come from sources outside Libby, and he purchases all supplies except his inventory locally. "If I can get the goods I need, I buy them here," he said. Last year he spent over $10,500 at the Libby Post Office, $6000 for local printing services and $1500 for office supplies.
Cohan recommends that people should not form their opinions from news reports that exaggerate reports of pornography and Nazism on the Internet. He encourages those that can capitalize on a specialized market to use the Net, and explains that it is a great way to start a small business since costs are minimal. "The best tip of all is not to be intimidated by it," he said.
Cohan is eager to help anyone interested in doing business on the Internet, and invites them to stop by and discuss their ideas. "I'm willing to help in any way possible," he said.