What You Need to Know About Starting an Online Business
By Martha Michael
If the economic changes caused by COVID-19 resulted in the loss of your job or a drop in income, you may find a path forward by looking where so many answers can be found -- on the Internet. You probably know people who have carved out a decent career through internet commerce, but before you design your own commercial endeavor through technical means or open an online store, you need to do significant research.
Types of Online Businesses
Finding a profitable idea to launch an online company is, of course, the first challenge. Tapping into a field in which you have both expertise and passion is a winning combination, but once you’ve found it, you have to determine how you want it structured. An article by financial website TheBalance.com describes five types of online business models to choose from.
Video production - Video is a valuable component of online commerce, and the images you create not only tell your story, they can be monetized with advertising. Anyone acquainted with YouTube can recognize the appeal of a professional video for sales and promotion and it’s an essential tool for some businesses. Your company can create commercials or provide information products, including e-books and webinars for educational purposes. The internet is all about video -- and content is king.
Drop shipping - This is a service you can factor into the structure of an online retail sales company. A third-party shipping and delivery company enables you to profit from the growing world of e-commerce with a much lower overhead cost. You don’t have to maintain the inventory and there is no warehouse involved -- you simply handle marketing, advertising and sales. After you sell a product, you purchase the product and have the drop shipper send it out.
Affiliate marketing - This is a way you can earn sales commissions from e-commerce website hosts. When you post a product review or manage a blog, include links to affiliated companies which contract with you. When you drive traffic to their sites you earn a commission. Again, you don’t have to pay for products and supplies -- the affiliate partner carries the overhead costs. You may send buyers to a digital information product such as an e-book or video file, which generally pays up to 50 percent or more in commissions. You can also promote physical products on your site, which typically offer 5 to 25 percent in commissions.
Blogging - This is a proven method for engaging with your target market. The goal is to create search engine optimized content that attracts attention from potential clientele. There are free sites for blogging where you can generate ideas about your favorite subject and, with a winning marketing strategy, it will translate into profits. If writing is a steep challenge you can hire it out, but there’s also room for photos, videos and links that relate to your topic.
Pick a Product
If you decide to sell a product online, there are key steps involved in the process, according to BigCommerce.com.
The product you choose to sell will affect every aspect of your business, including:
- Determining your brand
- Designing your website
- Marketing strategies
- Developing loyalty programs
- Shipping products
Choose a product that solves a problem - Sometimes the challenges you have faced personally can be transformed into the best business ideas. Kyle Kirkpatrick was an Olympic gymnastics coach who invented molded earphones called Decibullz. The invention stemmed from his own desire to listen to music while coaching, but without detracting from successful sessions by wearing huge headphones.
And your product doesn’t have to be a brand new, original design. You can offer solutions by simply making improvements to a product’s features or by altering the scope of your marketing plan.
Find products the public is passionate about - The number of hours it takes to launch and run a successful company requires a passion for your products and services. That level of excitement is what fuels the sacrifice it takes to operate your own business. Both you and your customers need to have an emotional investment in your products.
Create products that are easily branded - You need a strong message when you get your product into the marketplace because the most popular merchandise resonates with customers and is remembered by them. Research your target shoppers so you can connect them to your brand.
Make sure you’re ‘on trend’ - Part of the research process involves staying on top of movement in the market. As a business owner, you can tailor your marketing strategy according to what’s trending and give your bottom line a boost by riding the wave of popularity.
Find your niche - As an online business you need to expose your brand to the right audience. Your conversion rate depends on how well your product resonates with specific members of the public -- those who are most likely to become end users.
Features that are currently in demand include:
- Healthy foods
- Takeout options
- CBD products
- Pet food products
- Shape-conscious clothing
- Animal cruelty-free beauty items
- Men’s engagement and wedding bands
Selling on eBay is not the only way to make money online, and more avenues are opening every day. The lanes of opportunity are expanding and if you’re forced to alter the course of your career, it’s nice to know there are options so close to home.
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