Unlike traditional businesses, which often have structure imposed on them by the financial entities that finance it, starting a business online often requires nothing more than an idea and a website or blog. You don’t have to write a business plan because you don’t need finance to start blogging, set up affiliate relations, and so on.
The barrier to entry into the online market is much lower than traditional businesses, which is great. But, it’s a double edge sword because the easier it is to do something, the more people try it out. This means that you have to work harder at distinguishing yourself from the melee of other startups out there – because, believe me, there are a lot.
Less than 5% of all purely online businesses (i.e. business that have no traditional, physical counterpart) ever actually make any money. It’s hard to draw a decent living from the Internet, but because it is easy to setup, the allure is great enough to keep people trying. If you are to be successful it is imperative that you avoid the mistake of not being disciplined in your approach.
Here’s a checklist of all the things you need to consider before starting a business online (I’ll explain each step after):
- Understand your value offering
- Identify the market
- Market discovery & research
- Identify the needs of your online business
- Select a suitable web platform
- Design and develop your web presence
- Generate content
- Deliver content & drive traffic
- Convert traffic
- Traffic analysis
Starting a business: Market research
The first three points in this startup checklist basically require you to do adequate research into your market. You have to know what the value of your offering is to the people you are offering it to. For example, there’s no point in pricing your premium content at $3 a posting when the exact same content is being given away at a larger, more established site.
It might sound redundant, but often small businesses take far too long to understand where value lies in what they offer. By understanding:
- what you offer
- who you are offering it to
- why there is a demand for your offering
- where those people are
- how to get your message through to them
you are well placed to start a business.
Starting a business: Online implementation
The following three steps in the Internet business startup checklist deal with setting up a suitable web platform from which to start generating revenue. You know what your business needs to deliver and who it has to go to, so now you need to decide on the best way to meet those business requirements.
If you are an affiliate marketer, then a free WordPress blog might well be suitable. However, free online tools might be easy to setup but they are not as flexible and powerful as other web platforms.
If you want to take control of your own online advertising, create an eCommerce website, operate a forum, support centre, and so on, then you will most likely need to use a good CMS platform like Drupal. You might also need to speak to a professional designer or developer to help you set up your website quickly and efficiently.
Remember that it is really important that you look to the future before deciding on a web platform. You will have to do some marketing, so make sure you can easily add new content to your site. You might want to make revenue from advertising down the line, so make sure you have the facilities in place ahead of time… you get the idea.
Starting a business: Internet marketing
Recall that at the start of this article I mentioned how easy it was to start an online business? The other side of that coin is that every man and his dog is doing exactly that. Online consumers are jaded, and impatient. It is not easy to convince them to spend their dollars with your relatively unknown startup because there are millions of relatively unknown startups, and most of them are complete rubbish.
You distinguish yourself from the sea of competitors by creating great content. I’m not joking either. Creating high quality, highly relevant, engaging and SEO enhanced content is arguably the most important marketing exercise you can undertake. It takes a while for your content to be indexed by Google, but once it is the effects are cumulative (the more content you add, the more traffic you generate) and persistent (unlike online advertising, which offers no long term benefits).
Good content can also have incredible short term effects using social media. Write an informative article relating to your niche and spread it around twitter, Facebook, Digg and so on. You never know who might pick it up. Your article could lead to thousands or millions of hits, news articles, radio interviews and so on – and this can happen overnight. The world is changing rapidly and good content with a sound methodology for disseminating it, is the most powerful marketing tool you have.
Starting a business: Convert & monetise
You must make your site as easy to use as possible. Potential customers won’t waste their time trying to work out how to use your site. If it’s not immediately obvious how they can get what they want, they won’t do it. Not only should the UI (User Interface) be optimised, but the site itself should be designed to make it as easy as possible for visitors to convert to customers – i.e. it should be optimised for conversions.
Apart from converting customers, there are other ways to monetise a website. If you have done a good job of persistently creating engaging, highly relevant, SEO enhanced content then it is likely your site will begin appearing on the first page of the search engine results. When this starts happening, advertisers sit up and take note. You might find offers to advertise on certain high ranking pages start trickling and then flooding in.
The beauty of content based marketing is highlighted by this situation: You create content that helps you to market your business. The content then becomes so desirable that other companies are willing to pay you to advertise on it. In other words, you are being paid by other companies to market your own website.
Creating great SEO content is not simple. It takes time, patience and plenty of practice to get the hang of doing SEO keyword research, structuring your documents to be SE optimised, and so on. It’s not hard, certainly not impossible, but it is a skill you need to learn.
Starting a business: analyse and refine your business
On paper, this whole checklist might seem like your business should run like clockwork. In reality, you will not get everything right the first time (no one ever does). You might be losing customers during checkout, your content might not be competitive enough to show up in search engines, your business value offering might be misdirected , and so on.
It is important to regularly analyse how your online business performs and look for areas of improvement. In particular, you will need to implement some form of traffic analytics for your website. Analytics (I recommend the free Google analytics) allows you to see where traffic has come from and what it does on your site. This helps you position your marketing efforts and improve on under-performing areas, while driving home your advantage in areas you are succeeding.
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