Blogshop woman jailed for cheating 37 buyers

More on Blogshop Scams:

Sun, Aug 16, 2009 The Straits Times Blogshop woman jailed for cheating 37 buyers By Serene Luo & Teh Joo Lin A YOUNG woman hawked branded accessories and handbags at bargain prices on her blogshop. But Diana Koh, 21, never delivered the bags, even though she pocketed over $1,000 in total from close to 40 women who responded to her online offers of bags, jewellery casings and make-up pouches. Yesterday, Koh was jailed for three months for cheating 37 victims in March. A district court heard how one of her victims had ordered bags from her via the website, k-sayuri.blog spot.com The site has since been shut down. In early March, the victim had been drawn to the website while surfing the Internet and ordered five bags. Koh promised to mail them to her home. The woman went on to transfer $87 to Koh's bank account but the bags never came. Her subsequent attempts to contact Koh were unsuccessful. When contacted, another victim, a 24-year-old who bought a handbag from Koh for $19, said other sellers had priced it at almost $50. She said Koh claimed she was selling it at a discount as she had to migrate to Australia soon. Asked if she had smelled a rat, the woman said: 'Yes, I did suspect at first. But human beings are greedy and since it's not a huge sum, I decided to try my luck.' Koh is not the only one who has been jailed for an online scam involving the purchase of branded goods. In March this year, the police arrested a woman who went off the radar after collecting over $30,000 online from buyers to make bulk purchases of branded Coach and Kate Spade handbags. She was later jailed. With Internet shopping becoming commonplace, individuals have started to sell goods through postings on auction websites or advertising on their own blogs. Online shoppers said not all sellers can be trusted. Ms Irish Ng, 25, was cheated a couple of years ago when she saw a blouse for sale at a blogshop. She transferred money to the seller's bank account, but the item never arrived. 'Back then, I was young and took it as a lesson learnt. But I think such cases are very common now,' she said. Irked by the prevalence of the scams, the private tutor started a website, www.safeblogshopper.com, to inform online shoppers about dishonest sellers. She compiles information she gets from Internet forums and identifies the dishonest sellers who have been named by online shoppers. She came up with the idea after seeing more complaints of cheating being posted on forums. 'I realised that different forums would talk about different scams, and they may not cross-reference them. It wouldn't be easy for someone to learn about other potential scam shops,' she said. Popular online payment processor PayPal offers those who use its service some form of insurance. It has drawn up policies to allow users to file claims against those sellers which they feel are dishonest, for example, in instances when the goods do not arrive. This article was first published in The Straits Times.

Online businesses getting a storefront

Going offline is a goal of many blogshoppers.  In this article a couple things jumped out at me.  First is that it is important to solidify the online business before starting up a brick store front.

Secondly, going slow, that is flea markets before full commitment.

From: http://sg.news.yahoo.com/blogs/fit-to-post-finance/checklist-online-businesses-getting-storefront-022802023.html

By Terence Lee, SGEntrepreneurs

Don't count on renting a storefront to revive the flagging sales for your online business and compensate for a weak business model: You might end up digging yourself a bigger hole. Rather, going retail may be prudent only if your online business is doing very well.

So if you're considering whether to head in that direction, here's a checklist compiled from the experiences of retailers who've made that step, and well as blogshop owners who chose not to.

1) Make sure you have a strong online fanbase

If your online business does not have loyal customers, then it may not be wise to transition offline. For KissJane, which aggregates blogshops in two physical locations, it can rely on the branding of its myriad of partners. Tracyeinny, on the other hand, was able to leverage on its strong fan base to offset the lack of human traffic in their first outlet in Pearl's Hill Terrace, Chinatown.

Ng Chong Kee, co-founder of KissJane, suggests that blogshop owners build a strong niche for themselves by focusing on a particular style. Only by doing so can they differentiate themselves from the thousands of blogshops out there.

Jeannie Pang of Tracyeinny believes good customer service is paramount. Customers must feel that you're reliable and always ready to respond to their requests and complaints.

"Accountability is damn important. If you failed or neglected to deliver a product, you'd better admit it," she says.

2) Make sure you won't be burnt financially
The amount of money you need to invest in going retail is no joke. For prime locations, expect to fork up around S$200,000 (US$166,653) in upfront rental, deposit (which will only be returned at the end of the lease), renovation, and other costs. Even in places like Chinatown, monthly rental can cost around S$3,000 (US$2,499) a month, in the case of Tracyeinny.
Depending on the contract, lease commitment can be as short as six months or as long as three years for many shopping malls.

So it really helps to work out the sums, know what you're in for, and plan accordingly. Jeannie made sure she had at least S$18,000 in the bank account, or six months of rental liquidity, before committing to a lease. This precaution made sure that in the event the endeavor didn't do well, the overall business would not be adversely affected.

3) Ensure you have a healthy revenue stream for your business

Jeannie ensured that the profit margin from her online business was strong enough before embarking on her retail project. She also made sure that she had a sizable sales volume as this meant that she won't need to pass the increased costs from the retail business to the consumers.

To generate a healthy profit margin, online retailers should not be afraid to charge a premium for their products. As a rule of thumb, a shirt that costs S$15 should be priced at around S$30, says Jeannie.

4) Consider starting small, such as at a flea market

Before committing to that hefty three-year lease in a swanky shopping mall, why not take smaller steps first? If you're confident about your brand's drawing power, opting for less-than-ideal locations may not be a bad idea, since rental is cheaper and the lease is shorter.

Working with companies like KissJane may be an attractive proposition, since you're only paying for a rack as opposed to the whole space, although you'd have to figure out a way to get ahead of the waiting list.

Finally, you can opt for flea markets to get a taste of what it feels like to operate in a retail environment. There are plenty in Singapore, and they don't cost a lot to get involved in. Zouk Flea & Easy and Flea Fly Flo Fun, for instance, will only set you back around S$50 per slot.

5) Make sure you are willing to commit more time and effort to your brick and mortar business

Sure, going retail may reap in heaps of profits, but you'll have to work harder for it too. Vincent Goh and Tan Yi Fong of Ministry of Retail, which specializes in Korean fashion, prefer to keep their lives simple and so decided not to set up a physical store of their own. And they've apparently done well so far, with Yi Fong becoming one of the top five earners in her university.

In addition to managing inventory, rental, and other facets of a retail business, there's human management, which require a lot of effort, as Jeannie asserts. She had to hire six salesgirls to manage operations and train them well since they represent the brand.

"Sometimes when they do something wrong, I go mad like a volcano!"

Prosumption

I am trying to determine if blogshopping is a prosumption activity.  Traditional definition of prosumption is that the consumer assumes some of the producer's roles in making products that will be consumed by the consumer.

In blogshopping, buyers become sellers of the kind of items they are interested in buying.  The theme is there, but is it the same as what we understand about prosumption? Or is it a type/version of prosumption?
The difference is that in blogshopping the buyer may not co-create the products (the more advanced ones do  make and sell, so at least at the extreme end, they BECOME prosumers?), but they just sell them.  Thus, at this point, they are more like resellers.  At a more advanced stage where the blogshop owner begins to have creative and productive capabilities (like making their own designs and clothes), they MIGHT BE prosumers since they are now creating and consuming in a same product category.

Also, the buying and the selling is not necessarily on the same item.  They undertake both roles in the general product category, which differs from the usual example of prosumers being the people who pump their own gas or make their own salad at McDonald's.

In blogshopping, the buyers become sellers.  But do they become prosumers in the sense of the word?  Or does the concept of prosumption include the notion of buyers becoming producers?

The article below makes note of an observation that I see with blogshop owners in that they (referred to here as prosumers) are selling themselves.  In blogshopping, this is what happens when a blogshop owner who designs her own fashion pieces infuses her ideas, and personalities and art into her work.  Thus ultimately, blogshops are probably linked to the idea of 'self-displaying' and 'self-selling'.

A post from the blog: http://kulturmonster.wordpress.com/2009/05/14/a-very-quick-word-on-prosumption/ 

PROSUMPTION

I think it is interesting to look at web 2.0 applications under the notion of “prosumption”. Prosumption is an economic model, “where capitalist subjects produce what they consume, turning consumption in to a form of production“ (Boellstorff 2008). This idea is elaborated in Toffler’s book “The Third Wave” (which I have yet to get) (Toffler 1980). In his very, very recommendable book “Coming of Age in Second Life”, Tom Boellstorff puts the “prosumer” (In “Second Life”) in a bigger framework of “creationist capitalism”. Production and consumption conflate – to fully participate in second life’s culture you have to create something.“In creationist capitalism it is persons who create, not God” (or the companies). The theme of the mood in which such ideas subside is nicely captured by Purdy’s article “The God of the Digerati”, available here (Purdy 1998).

The model of prosumption is not only applicable to “Second Life”, we can easily see how it fits networks like YouTube (or this blog post). But what does it mean that consumption becomes a form of production?
First and foremost it sounds like a manager’s dream. Not the company has to create the products the user consumes, users create their own products. The only task that is left, is to provide the infrastructure (Sounds great, but apparently YouTube still doesn’t make any profit).

Secondly, this might denote bigger cultural developments and since it is social interaction which is happening in these networks, it sets the frame for these interactions. Maybe this is the more interesting question. What does it mean that people participate in a culture where consumption means production, and what is it that they are producing? Posing this question presses us inevitably in a marxist tradition. The first and obvious answer is that people are selling themselves, their personality (in the widest sense) to the potential audience. They create a certain personality for display (might as well be their everyday character), and in the act of creation they are consuming this very portary. Now, I won’t try to elaborate further on this topic since it will probably only lead me to wild fantasizing, but I think the question alone is worth entertaining.