By harnessing the power of the worldwide web, small businesses are now able to reach beyond local markets to sell their products to customers around the world.

But just like your local market, the world of e-commerce is highly competitive. To be successful you're going to need to stay one step ahead of the competition. Here are some strategies that will help you gain - and maintain - a competitive advantage over your very real competitors in the virtual world of e-commerce.

Develop a Highly Quality Virtual Catalog

To truly succeed in e-commerce, you'll need to invest in the development of a first-rate virtual catalog. Similar to a mail catalog, a virtual catalog displays photos and information about your products, and provides a method for customers to place orders. But instead of sending the catalog to the customer, the customer comes to the catalog by visiting your company's website.

Virtual catalogs have a number of distinct advantages over traditional mailed ones. The nature of a website makes it easier to display your product in a variety of options and to include additional product information that there may not be room for in a mail catalog. Also, unlike a mail catalog, virtual catalogs can be easily changed to add or remove products and to update product availability information.

Having a poorly constructed virtual catalog can sometimes be worse than having no catalog at all. Since creating quality internet catalogs requires a certain amount of expertise, you should probably outsource this task to a dependable web designer.

Advertise on Search Engines

Your website and virtual catalog will only be as effective as the amount of traffic (potential customers) that visits the site. To increase traffic, you'll need to explore the possibility of advertising on search engines, e.g. Google and Yahoo.

Most search engines sell space for ads that will appear alongside or around the list of websites that appear when an internet surfer types in a set of search words. Under the right conditions, these ads can be a great way to direct people who may already have an interest in your product to your website.

Negotiate Links with Other Websites

Another way to increase traffic is to negotiate links to your site with other high traffic websites. For either a fee or a reciprocal linking agreement, other companies may be willing to include an ad for your business on their website. While it's highly unlikely that you'll convince the competition to participate in this kind of arrangement, it is very possible to negotiate links with companies that sell complementary or non-competing products.

Another benefit of links: One of the variables most search engines use to rank websites is the number of links that exist to your site from other sites. The more links there are to your website, the more likely it is that your site will appear ahead of the competition in keyword search.