7 Essential Steps to Start an Online Business
Starting an online business has the benefit of lower startup costs but it still requires many of the same steps as starting a land-based business. You will need a business plan, funding, a target audience, and a good team.
1. Develop an idea
Finding a good idea for an online business may require some research and brainstorming. Start by looking at the specific industry you would like to get involved in. Can you identify a gap in the market? Is there a skill, hobby or passion you can turn into a way to make money? Is there a product or service that you think you can improve on?
You may decide you want to sell photographs on Etsy. Profitably selling photography on Etsy will require some research to find out what types of photography people are looking for and what keywords have a high search volume. You will need to find out whether it’s worth working with a print-on-demand provider to print photos on physical products for you.
2. Define your value proposition
Defining your value proposition means that your product or service has to appeal more to customers than your competitors’ offerings. No matter how good your products or services are, you won’t attract customers unless you can offer them a clear advantage.
You will also need to identify your specific target audience so you can tailor your marketing to appeal to this group of people. With a clearly identifiable audience, you can keep your marketing costs low.
3. Create a business plan
Defining your specific goals in writing is necessary. This is why every entrepreneur needs a business plan. It will detail your business idea, what market you will serve, and the strategies you will use to get it off the ground.
Your business plan will include a cash-flow forecast so you can decide how much capital you will need to start. It will also define the structure of your business.
4. Establish your online identity
If you want your online business to succeed, it must have a recognizable online presence, including a website and profiles on social media platforms. You will have to think about the brand image you want to convey, your brand voice, and your logo design, all of which should contribute to creating a consistent brand image across all platforms.
Look at successful competitors and see what they’re doing to establish their online presence. Don’t copy them but learn from what they do well. Reach out to bloggers who may have influence with your target audience and grab their attention with your product launch, new client wins etc.
5. Look for funding
Capital is like oxygen to a new business and without it, the business will struggle to survive no matter how much potential it has. Potential investors and lenders will be more likely to support your business if you can show them your business plan.
There are more sources of funding for online businesses today than ever before. If you already have a public following, crowdfunding can be a great source of money. You may have some money saved up or have family or friends who can help you to get going.
6. Assemble a team
This step will obviously depend on the type of online business you have but most will need a team. You will often start by wearing many different hats. This is fine when you are just starting out but as a business starts to grow, it is important for you to assemble an effective team that offers the kind of expertise you may not have. Trying to be cost-efficient by not hiring employees will be counter-productive in the long run.
7. Make sales and repeat
Even once your online business is on the go and you start making sales, you can’t afford to let your guard down. There are constant changes in the online established environment and you have to stay up to date with new trends and keep thinking about ways to innovate or expand. You have to keep developing your product or service, keep making sales, and keep getting known. Staying on top of your finances is essential, too, if you want to make sure your expenses don’t outweigh what you’re bringing in.