How to Start an Online Business
Technology has revolutionized the world in more ways than we could imagine. When it comes to the online business landscape, it has leveled the playing field for businesses of all sizes. You can now start your online gig without any up-front costs that a brick-and-mortar business demands. That said, this does not mean that you can simply take a dive and hit a home run.
Establishing a successful online business is not always as easy as it seems. From selling a product or service to building a brand image, there’s a lot to consider. Factor in an overwhelming number of business options that you might have in your mind and it quickly becomes a dilemma.
But know that if you dream of starting an online business, you’re not alone in this ordeal. There are an estimated 12-24 million people around the world who are successfully running an online business and probably more who couldn’t make their dream come true. Most people want to start an online business because they want to be their own boss or want to pursue their passion or don’t want an unforeseen event, like the pandemic, to disrupt their income.
If you want to start a successful online business, the most important things you need include a good idea, some startup money and time to get started, and a guideline to follow. In order to help you navigate and kick-start your online business venture, here is our detailed guide on how to start an online business!
Start With a Business Idea
A successful business regardless of its type and size starts with an idea. And this is often the most overwhelming part of starting an online venture. The first question that pops into your mind is, where do you start? A business idea doesn’t necessarily have to be only innovative and promising. In fact, you need to have the required skillset to make it work.
A few important questions that can help you find an incredible business idea are as under:
What Skills Do You Have?
When it comes to finding a solid online business idea, the best place to start is your own skills, knowledge, and expertise. Consider your field of study, your interests, your experience, and your key strengths. Think of certain subjects or fields that you excel in. Ask yourself if you are the go-to person for that specific field in your current workplace. You also need to consider the topics that you have researched a lot, whether it was for work, education, or to quench your curiosity.
If you feel that asking yourself doesn’t help you find your best skills, the next step is to ask your friends and family to help you out. Asking others what they admire you for can help you unravel new paths for your ultimate goal. You can also reach out to your colleagues and ask what they best remember you for.
What Need Should Your Business Fulfill?
More often than not, most people start looking for a product first and forget about the market altogether. But the truth is that in order to boost your chances of success in an online business, you should start with a market.
Only having a certain skill set or a passion is not enough to succeed. There has to be a market for it too. Think of this as solving some sort of real-world problem and for that, you have to make sure that there are a good number of people who are looking for a solution.
However, it doesn’t just end there. You also have to figure out the level of competition that is already solving that problem. Once you have figured that out, plan how you will make your business stand out in that competition. All of these steps will help you ensure that there’s room for your business and that you are not planning for a nonexistent business concept.
Can the Business Operate Only Online?
Not all businesses can function completely online from home. Therefore, an important concern is finding out if your online business idea is feasible for operating online. An online learning business or online support does not need any sort of physical infrastructure. But an e-Commerce business needs storage space such as a warehouse and physical shipping to function successfully. And while you can use a space in your house for storage and other business needs, this is just an important element to consider aligning your resources with your business needs.
Find a Niche
A niche can be defined as a focused business area within a diverse and huge market. For instance, a business that sells shoes for nurses is a specialized niche within a huge fashion market. Before you start your online business, it is important to find a niche and analyze its potential for profitability. Sometimes, finding that niche is possible by simply identifying problems in your daily life that can be solved. Other times, you might have to do some research and brainstorming to come up with some potential markets.
A great benefit of finding a niche is that your online business has to face less competition. This benefit, in turn, gives you a better opportunity to differentiate your business from competitors. It also allows you to put your specialized skill set and expertise to good use. Similarly, apart from great customer loyalty and retention, you can also price products or services higher due to less competition and high demand.
Before you select a niche and start offering a solution, it is also important to find out if it is profitable enough to guarantee the success of your online business. For this purpose, you can research if the sector has a consistent interest or if it is seasonal. A simple Google search about the fastest growing industries by revenue growth or using Google Trends can help you determine if your chosen niche has the potential of being profitable.
Decide on What to Sell Online
Once you have a brilliant business idea and you have chosen a niche, the next step is to determine what to sell. There are various solutions to the same problem and your job to make your business succeed is to offer the best of them all. Broadly, your options can be categorized into products, services, or your knowledge.
Products are tangible objects that your customer can touch and interact with. It could be clothing, pet accessories, furniture, tools, etc. If you plan to sell a product, you can manufacture your own product or source it from a wholesaler or drop shipper. In any case, you will have to figure out how to store and ship it.
Services do not involve transferring physical goods from the seller to a buyer. It is a task performed by you or your team professionally and knowledgeably to solve your customer’s problem. A service can be teaching, consultancy, professional guidance, etc.
The last option is knowledge, which is similar to services. If you have knowledge about a particular subject or field, you can impart it to your target audience. This can be done via videos, e-Book, podcast, online training session, white paper, etc.
Regardless of what you decide to offer to your target audience, there are a few things that you should be sure of before you start selling it. Firstly, make sure that there great market viability for your product or service. This means that your solution will continue to be profitable for a long time. You also have to make sure that your solution targets a niche as well as a large enough audience to allow your business to generate sufficient profit. It should also be able to make your business stand out from the competition. Lastly and most importantly, it should be compliant with the legal requirements. Make sure you have the licenses, permits, or certification required to run operate your business and sell your product or service.
Put Together a Business Plan
Now that you are through with the initial legwork of starting an online business, it is time to put together a comprehensive business plan. Before you start wondering if it is even necessary for an online business that does not require external funding, let us tell you some major benefits of making a business plan. While you might not need it for your online business, having a business plan helps you identify any potential shortcomings of your business idea down the road. This allows you to plan future business growth and profitability. A good business also allows you to explore your target market, set objectives, and devise long-term marketing strategies to acquire greater market share. Needless to say, it assists you in making strategic decisions that can be detrimental to your business’ success and failure.
You can start with a lean business plan, which takes not more than 30 minutes, rather than a detailed plan that could take weeks to put together. You should also identify your startup costs in your plan and set success metrics to track your business performance. Even if your online business is a side gig, metrics will help you determine if your business is headed in the right direction.
Set up Your Website and Start Selling
One of the most important things for an online business is its website. It can be considered to be as important as the physical location of a brick-and-mortar business. Therefore, it requires you to put in as much effort as you would to design and construct a physical outlet.
However, setting up a website would not be as simple as designing a landing page. From hosting and platform to design and content, there are going to be multiple avenues to represent your business in the best way. You have to remember that your website should accurately represent your products, services, and brand image.
You have two options to get your online business up and running; using a third-party marketplace or setting up your own e-commerce website. While using a marketplace to sell your products or services can take out the legwork from the process, an e-commerce website is a direct way to sell. And not just that; it also allows you to build long-term customer relationships and have control over your store. You can customize every aspect of your website to make it reflect your business accurately. This includes domain names as well, which can be purchased on familiar domain purchase sites like GoDaddy.com. That said, you must make sure that your website offers the best user experience with a brilliant and appealing design and suitable shopping cart software.
Fewer things in the world might be as rewarding as being your own boss and doing what your passion calls for. Fortunately, all it takes to do this is finding the right business idea, niche, and target audience to fuel your cherished dream.
And while starting a successful online business might not be an easy process, it isn’t impossible either. In fact, it can be the most exciting journey of your lifetime. You need to have a strong footing for your online business. This goal can be achieved by developing your products or services to sell, choosing the right e-commerce platform, and employing marketing strategies to fuel business growth.
You can also take these insights and your financial management a step further by investing in a smart tool like the Doctor Money app. This intuitive tool can not only help you keep track of your start-up costs and income but also helps you manage them accordingly. With better control over your finances, transforming your passion into a productive venture is only a matter of time!