Research & Refine your Business Idea
An online business gives you wonderful opportunities to test your entrepreneurial acumen without having to invest a large sum of money in the project.
Successful business establishment, regardless of the niche and the format, begins with a good idea and a strategy.
The term online business is quite generic. You need to determine exactly what you’re going to do, what the revenue generation model is going to be and how you’re going to reach clients.
Will you sell handmade jewellery online? That’s an excellent opportunity for turning a hobby into a business. Will you be offering professional services (copywriting, graphic design, website development, business consulting, accounting, etc.)? The method of setting up your online business will be heavily dependent on the primary goal and the main activity.
Starting an online business is relatively simple – you need limited equipment and inventory. If you are going to be offering professional services, you’ll simply need a reliable computer and internet connectivity. Building your own website to attract potential clients and demonstrate your expertise will also come in handy.
If you plan to launch an ecommerce enterprise, you will need to do a bit more work. You’ll have to sort out storage, warehousing, shipping and other logistical issues. Product development or importing will also depend on your plan.
Sit down and pinpoint the scope of the endeavour. Determine the products you’ll be working with, the activities you’ll have to engage in as a part of your everyday professional routine and the equipment required. This information will help you find out the amount of funds needed and the timeframe for putting the idea together.
Creating your Business Website
An online business, regardless of the niche, is heavily dependent on a solid website. If you’re offering services, you need an online portfolio that shows potential customers your capabilities. If you’re selling products online, you should develop an ecommerce website that encourages exploration and engagement.
Your business will benefit from high quality website development in the following ways:
- You will present your work online
- An ecommerce website encourages people to explore products and shop around
- The quality of the website and the visitor’s experience will correlate to your professionalism
- A website will enable online monetisation and receiving payments from your clients
- It will provide an easy option for communication and inquiries
- If you plan to have a physical location like an office or a store, you can use your website to help clients in the area find you
- A website is an important branding element
The better the quality of your website, the faster your positive reputation is going to grow.
Setting up a website isn’t as hard as it may sound, in-fact, many hosting providers have tailored their service around small businesses who may not be tech savvy. We suggest going with BlueHost to host your website, they’re service is simple and easy to use/setup and they’re currently offering 60% off hosting, including free domain registration.
Additionally, creating a blog on your website is also a great way to attract organic traffic and expand your business. Checkout our full guide on the best and easiest way to setup a WordPress blog here.
Marketing Your Business
While it’s logical to advertise your online business in the digital realm, you can also utilise traditional marketing methods to attract prospects.
Your advertising efforts start with the development of your corporate or ecommerce website. The design should be modern and clean and the website should be search engine optimised.
Search engines will bring in targeted traffic when you optimise for the right keywords. The targeted traffic consists of people who already have an interest in the respective niche. Thus, you can easily convert these individuals.
A few other online marketing techniques you should be reliant on include:
- Social media marketing via Facebook, LinkedIn (for professional services), Instagram (for ecommerce websites) and YouTube
- Content marketing through the creation of blog posts, infographics and high quality videos
- Pay per click (PPC) advertising
- Paid-for Google search results (especially useful when you have a specific campaign and you want to drive a lot of traffic to it)
- Participation in relevant forums and communities for the purpose of establishing your reputation
Offline advertising can also pay off when you do it the right way. Regardless of the fact that your business operates in the digital realm, you can still benefit from traditional promotional ideas like:
- Business cards that feature your URL and email
- Participation in relevant events, seminars and tradeshows for networking purposes
- The creation of branded items handed out as gifts
- Discounts and coupons
- PR and building relationships with journalists or media representatives
Setting Goals and KPI’s
KPIs can help you track the performance of your online business. These are the metrics that suggest customer engagement, growth potential and long-term sustainability.
With an online business, you’ll need to focus on several essentials related to your website’s performance.
Website visits and the demographic profile of the audience are both very important. The same applies to the click through rate for marketing materials and the cost of acquiring a single customer. You should also pay attention to your website’s bounce rate – the number of people who leave the site after observing a single page.
For ecommerce companies, you will need to track repeat customers, the average size of a purchase and the percentage of abandoned shopping carts. If people abandon their shopping cart without finalising the purchase often, chances are that your website has some functional/design issue standing in the way of an optimal customer experience.
Plan your Finances
Starting an online business comes with the added benefit of limited expenditure in comparison to a traditional setup. Still, you should account for the financial parameters of getting your company going.
There are several essentials to anticipate and these include website development, domain registration, hosting and marketing.
Online businesses may also have to invest in getting the right permits and licenses, bookkeeping,, software and hardware, reliable internet connectivity, utilities, insurance, warehousing, logistics, employee salaries and transactional fees.
As your business grows, so will your expenses. Hopefully, by that point in time, you will be making enough to cover the expenditure and generate some income.
Getting started in the very beginning will necessitate a small budget. Many online entrepreneurs rely on their savings or assistance from family members to get started.
If you need more funds, consider the following opportunities:
- Crowdunding but you will need to build a strong case for your online business idea
- Getting an angel investor (once again, you will need to convince someone that your idea is worth investing in)
- A bank loan
- Look for a business partner who can cover the financial aspects of getting started
- Join contests and initiatives aimed at funding great startup ideas
Adopt an Entrepreneurial Mindset
Even if you’re selling your art online or you’re attempting to develop a blog that will bring in a lot of cash, you’ll have to be serious about the project.
Adopting the entrepreneurial mindset is an essential for the sustainable development and the growth of your original idea.
You can’t just launch an online business for fun, lack passion or commitment and wait for it to grow. Active involvement, preliminary planning and strategic thinking on your behalf will be required to ensure the long-term survival of your idea.
The businesses that succeeded were different from the others in several ways. For a start, they offered a product or a service that the market needs. In addition, these business ideas were characterised by attention to detail on behalf of the entrepreneur, niche specialisation, a contingency plan for emergency recovery and fast growth fueled by a solid strategy.
You can nourish the entrepreneurial mindset by educating yourself.
There are various podcasts that discuss relevant topics and provide education. This Week in Startups is dedicated to providing a platform to experienced entrepreneurs and investors. These seasoned pros share growth and sustainability ideas with startup owners. HubSpot’s The Growth Show is another excellent podcast that online entrepreneurs can learn from.
Other things to consider when starting your online business
The legal requirements for starting an online business will be pretty much the same as the prerequisites for launching any other commercial entity.
Check local regulations and the type of business registration you’ll need for bookkeeping and taxation purposes. Talking to an experienced attorney can shed some light on the business registration that will make the most sense in your case.
Online businesses can run into some administrative issues when selling products to customers in other parts of the world. In such instances, the legal aspects of operation could become somewhat more complicated. Once again – legal assistance will be required to sort things out and to make sure you’re not breaking any laws via your online business operations.
Accounting & Bookkeeping:
Online businesses need to maintain impeccable financial records.
You will need to track your business expenses, interactions with clients, financial statements, invoices and bank account excerpts. Keep receipts for all kinds of expenses and transactions. Your accountant will determine which ones are relevant and needed.
Speaking of which, you need to hire an experienced accountant to handle your financial affairs. Many startup owners attempt to do bookkeeping on their own. Even if they manage to handle the task, they will be wasting a lot of time that can be invested in business growth and development.
Accounting companies that have experience with online businesses are a good choice. If you want to save some money, consider hiring a freelance accountant. These professionals could have an excellent reputation but they will charge a lot less than a larger accounting firm.
Finally, you will have to get some basic accounting software. You will need to create invoices and track payments or transactions. Options like Xero will come in handy.
In the beginning, you may be capable of executing the online business idea on your own. As time passes, however, and your business grows, you’ll probably find yourself overwhelmed by the operations.
If you’re offering professional services to B2B customers, you may want to hire customer support, account and project management team members. Another reputable service provider could also be a great choice because you’ll get to work with a bigger number of customers this way.
Look for people who have sufficient experience, who are self-motivated, responsible and accountable. Online companies don’t operate in the exact same way other corporate structures do. There will be a lot more freedom and flexibility. A person that isn’t disciplined will be far from productive in such settings.
When selling products via an ecommerce website, you will need someone to do inventory tracking, the organisation of logistical operations and customer service.
If you don’t do website maintenance and marketing on your own, you will either have to outsource these processes to a specialised company or you’ll need to hire professionals/find freelancers for the respective jobs.