I get a lot of questions from people that are thinking of starting their own online business. They may have heard how easy it is to make money, or they want to get away from a regular 9-5 job, or they may want to work from home,i.e. they are a Mom or retired.
There are a thousand reasons that are all valid to start your own online business. Luckily, it is quite easy to get one up and running, but to have a SUCCESSFUL online business it takes a bit of work and planning. It is one thing to say I want to start a business, but to take action, you need to know what action to take!
This is why I am going to cover some of the main considerations for starting your online business, then cover three suggested and proven options to help get you started quickly and properly. If you already are aware of the points, you may want to skip to the bottom portion to see my suggested options…
Let’s get started…
Things You Should Know Before Starting An Internet Business
If you decide to start an internet business you can have a lot of fun with it. There are so many options that are ethical and offer you a huge opportunity. Unfortunately, if you try to get in without doing at least a little research, you could very well find that you will waste time, money, and effort.
Not only that, there are so many offers out there to get started, you will find yourself becoming overwhelmed very quickly. There are some people that will try to make it look very easy. Push button profits, 30-minute work weeks, instant thousands, are all sales pages will promise you.
The truth is that these people often just want to get to your credit card and cash. These are people that know what emotional buttons to push to cause you to take action and spend your money. They may or may not have your interests in mind.
There are other people who have really made it online, and they make it look easy. I will tell you that they more than likely did a lot of research beforehand. Using that research, they understood exactly to a detailed degree that they were able to avoid some of the common pitfalls of starting an Internet business.
Note that by reading through this post, you likely can avoid those pitfalls, as well…
Steps To Take Before You Start An Internet Business
Remember, one of the best things about the concept of creating and building an internet business is the wide variety of online market segments you can enter. Your business can also be as big or minimal as you may want or need it to be. It is all up to you, your circumstance, your desire and drive, and planning.
Here are a few things that any internet business entrepreneur should keep in mind before they do something like run out and buy a domain:
- Have a plan: This plan can be just for you, so it does not need to be a formal presentation that you are providing a bank or finance company. Still, while you don’t need to have that detailed of a formal business plan, you will still need to put together some sort of plan, preferably written. This way you know your plan of attack for the business. Preparing this may include researching your potential competitors, determining their needs or wants, evaluate what you can provide to solve their issues, and then develop a sense of what you will market to your selected group of people.
- Establish a budget. Any business costs money. You have startup costs, ongoing operational costs, and perhaps HR and accounting costs. Therefore planning will also require some sort of a budget forecast. When budgeting for an internet business, it is no different than any other business (although the overall costs are typically much less than for a regular brick and mortar business). You do want your budget to be realistic. Also, realize up front that most likely you’re going to lose money before you make money.
- Branding. Customers will want to meet you…Online is no different from offline businesses. Standing out from the crowd of internet businesses can be really challenging these days. Sometimes, it may seem to be impossible. One good way to do this naturally is to inject your personality into the business. Filter your own personality into everything that defines your internet business. Everything. From logo to copy, sales pages to products, from the social accounts to the blog pages include your unique take on the business.
- Pursue Your Passion. This is not an absolute must, but I can tell you it sure makes the business easier to invest in. If you are doing something you’re actually going to enjoy, you will be more likely to stick with it. Operating an internet business is a lot of work. If you are doing something you will be able to enjoy, you will make it through the challenging times.
5 Benefits Of Starting an Online Business
There are offline businesses that conduct online business. Look at Wal-Mart, Walgreens, and many others out there that have stores that people can shop from, while another major (and increasing) piece of the business they have comes from online sales.
Technically, an online business is not a digital or virtual extension of an existing traditional business as I described above. A pure online business is a totally digital enterprise (at least on the backend) where the primary strength of the company is in the virtual world. Think e-commerce stores such as Ali-Express or eBay, or training websites such as Udemy, or membership sites such as DealFuel (they sell digital products from their website pages).
However, for the purpose of inclusivity, we shall include the digital or online extensions of existing traditional businesses as well. You can do either and use the guidance found herein. In fact, I would say that if you have a bric k and mortar operation and are not tapping into the online market, you need to right now! You are missing out on huge chunks of the market.
Here are five benefits of starting an online business.
(1) Reasonable Investment
Remember that a pure digital online business will cost you a fraction of what a traditional or conventional business requires. To see what I mean, do just a little research and see what the cost is for launching an online store or e-commerce site versus opening an actual retail store.
I can assure you the difference will be a small fortune, perhaps a large fortune, depending on the niche and the competition. There are ways to go half-way with a digital presence and business. You can sell on larger platforms like eBay and Amazon or Etsy and still have an online business. You can create your own mini-site that costs much less, or you can enter into affiliate marketing (generally the cheapest method of all).
(2) Easy Startup
Note that an online business can be launched very quickly, in a matter of weeks, if not days even. Once the business plan is in place, all the products or services are ready to be launched, it literally takes days at most to start selling as an online business. If you use a WordPress frame and a ready-made theme, sales can start in less than a week.
(3) High Returns on Investments
Your investment is low starting out. Because of this, your ROI will be high when you compare them with a typical offline business, and you will have less work as you have no physical space to organize nor employees to pay. You can also scale the online business up quickly, and as your costs go up, gain even more return for your investment.
The returns on your investments are exponentially higher than conventional or traditional businesses. I have done both, and prefer the online business hands down. Remember that with traditional business, you need actual people visiting your store to make sales.
You can reach out to an immediate audience in the area, but no further. Your potential audience is global with an online business. You can transcend geographical boundaries, cultural and social barriers to emerge as a global phenomenon. It has happened to many thousands of companies
The beauty of online businesses too is that they can be automated to a large degree, in fact almost completely. Once you have the automation set up and working for you, much less hands-on is required and instead, you conduct reviews, assess performance, adjust as may be required and when needed.
Due to the power of the internet, you don’t need to personally or physically intervene at every stage. Everything from compliance to sales, customer service to upgrades, content creation, customer service, marketing, can be automated. It is a fact that digital entrepreneurs will have more time on their hands. They can diversify, expand their business, venture into new endeavors, and indulge in their hobbies or families.
(5) A Myriad of Freedoms
Remember too that owners of online businesses can work from anywhere, can work at any time, and can work for as long as they want. They only need an internet connection and tools to conduct their business. Another freedom possible is building financial freedom. Having an online business can be truly empowering for the owner. They will be able to carve their own lifestyle as they envision, and live a more fulfilling life compared to those that stick with a normal 9-5 job and the drudgery associated with that sort of job and lifestyle.
So now that you know some of the advantages that starting your own online business offers, there are some other details to think about before quitting your day job (don’t do that, at least not until you are ready!)…
How to Validate your Niche by Researching your Competition
Remember that digital online enterprises or online businesses are not bound by geography nor by as many stringent local regulations as offline businesses are. Even though this is true, there are still guidelines and regulations that you have to comply with depending on where you operate from. So although it is easier, it is not easy. you want to comply with these so you do not get into any legal or tax trouble.
On top of that, the area of business you will focus on is of concern. You will approach a niche market, meaning a group of people that are interested in a subject, hobby, or profession and create solutions to their needs and wants. Before spending a lot of time, money, or effort, it will pay to see that there is a market for what you want to sell.
This is also where having a passion for something, while important, is not the deciding factor. Using research, you need to find out if there is a chance to sell enough of what you have. If not, it does no good to get a ton of traffic that brings you no income. Your business will lose money but be popular.
Competitive niches are not a bad thing. This means there is business out there to be had, and if you offer a better mouse-trap, a portion of the business can be yours. Remember too, that we are not talking about a finite audience in a geographic region, your marketplace is global (or it can be).
Two main areas that you will want to look at:
(1) Demand First, Then Supply!
As with most businesses, you are looking first for demand, then for ways to supply that demand. If there is enough demand then you can likely cater to the supply and make a living. However, if there isn’t enough of a demand for products or what you have, then entering the niche makes no sense.
There is no hard and fast rule, you will need to calculate and see if based on the data you gather when analyzed indicates you can make a go of it in the niche. Try to remember the offline example or analogy that if there is only one diner in a locality, it is likely to be able to do well. But if there are too many diners plus a limited potential set of people to fill up all those diners, over time most of them will go out of business.
This is exactly what we look for in a niche. A digital enterprise or online niche must have the demand for there to be a space for it to exist (as a business owner, this is true. If a hobby niche, perhaps this may not hold water). The pool of potential customers is huge across the internet, but still, you must see if there is enough for you and the competition to make a living.
There will be times when the competition is too stiff, and the pool of customers too small to make it worth your while. You want to know this up front. You can move to another niche that also you can have passion with and succeed in. It all comes down to conducting effective detailed research then seeing what the opportunities may be.
So as you research, study the competition, find out how large the market is, and what solutions your competitors are already providing to meet the needs of the audience. Unless you can provide a better solution, you likely will have a hard time beating that competition. It becomes hard to gain a foothold, let aside being a roaring success.
Do you see how this process will save you time, money, and effort? You will have a good idea of what you are facing before you ever spend a dime!
(2) A Niche Within A Niche!
These days, it is highly unlikely that you will find a niche you have a passion for that is completely void of competition. You may be lucky to find one that has very little competition, That is not the norm nor even necessarily desired. They are just too hard to find.
If the players are covering a huge broad niche, there is another way to leverage that niche that will work if the numbers work. If there is a niche that is popular such as weight loss, there is likely humongous market shares and dedicated customers or audiences for that niche. Because it is so big, you can find a niche within that niche that will work.
There is a subset that will likely have a large enough audience that makes entering it worthwhile. For instance, losing belly fat might be a good sub-niche that would work in the weight loss niche. There are plenty of people interested (me included). It is all about the value you can offer to your audience and how you help, change or enrich their lives.
Okay, now you have a niche or perhaps a couple that will work. What is next? Read on to find out…
How To Create A Business Plan Outline
Once you have a niche or niches that you know will work, where you have a large interested audience and plenty of products you can sell to them, the next thing is to plan just how you will approach the niche. There are a number of angles that might work.
For brevity, we will call this a business plan, although as stated, it will not require a full-blown fancy report of presentation. This is a crucial step, as is determining the niche. It will be the foundation of your company. Regardless of how big or small your company is going to be, you still need some sort of plan for starting and for your future.
The plan is essentially the road map that you will follow to establish, grow, and make money from your online business. Having one will accomplish two things for you:
- It’s going to be broad in scope but will be specific enough that it helps you define exactly what needs to be done over the next year, two years, or even 3-5 years.
- It’s going to be open-ended so that you can make adjustments as real-life events may require, and from there you can again forecast out one, two, or even 5 years ahead.
This is not a difficult process, but it will force you to think through all the requirements, the impact each will have, and what you expect to be able to get in place, and how you will do that. It really helps to create a picture in your mind of how the business should progress.
Creating A Viable Business Plan Outline
Remember, this is not a professional outcome you are looking for. Usability is more important. This is your personal road map. Add in the basic elements and anything else that you consider important, and organize it so you can follow along easily.
A good but simple business plan outline is going to offer the following:
- Executive Summary: This element (a paragraph) is going to summarize the plan as a whole.
- Company Description: With this part of the plan, you’ll focus on what your company is going to do and also point out how your company is different from similar businesses.
- Market Analysis: You have researched your niche. Here is where you will add your marketing plans (broad statement) and your competitors.
- Organization/Management: Once you know what kind of business you will build, then you can plan for how you will set up the organization of it. Then from there, you can add in how it will be managed.
- Service/Product Line: Here is where you describe your product or services. Name benefits and lifecycles.
- Marketing/Sales: In broad brush strokes mention your planned sales strategies and marketing plans.
- Funding: This is a key area. How much cash are you going to need? How will that money be spent? Transparency and thought are key issues in this segment. You want to be honest with yourself and others.
- Financial Projections: Again on this segment, if you do need funding, thought through projections are going to be important. People will want to know how you came up with your figures.
- Appendix: In this last section, you can add in resumes, permits, leases, and anything else that might be pertinent to your business.
Note that you may need only some of the areas above. It really depends on what your execution will look like and if you will self-finance or have investors. This is something you will discover for yourself as you plan your business.
You are close to getting started. You have a niche, you have worked hard to create a plan that will work that you can follow as you start off on your entrepreneurial journey. As you prepare to get started, your mindset will have a great effect on how things go for you. Let me explain below…Please read on…
Treat your Business like a Business, Not a Hobby