Starting an online business is easy. You can sign up for an account on an online marketplace, such as Amazon, eBay, or Etsy, or create a website, and you’re set. But if you want to set one up for success, it takes more effort than that. From market research to growing your business, this guide covers the steps to start an online business.
Best website builder for small businesses
Best website builder for small businesses
Best website builder for beginners
Best website builder for beginners
Key Takeaways
- Starting an online business can be as simple or as complicated as you want.
- An online business is much easier to start than an offline one, you can start by spending little to no money.
- To ensure sustainability, find a product or service you can continue selling for the long term.
7 Steps to Starting an Online Business
The steps for starting an online business that succeeds in the long term include:
- Conduct market research
- Define your target audience
- Write a business plan
- Source products
- Build your brand
- Set up shop
- Market your business
Create your Business Today!
Don’t delay starting your new business. Everything you need start, run and grow your dream business. Start today!
1. Conduct Market Research
Most people who go into business think they’ve hit on a brilliant idea that makes them the next Jeff Bezos. Unfortunately, only about half (55%) of new companies make it to the five-year mark, and the top reason the other 45% fail is that they could not validate demand for the product or service.
If there is no demand, a business is doomed to fail. You must find out if enough people will buy your proposed product or service. Before anything, internalize it. Ask yourself the following questions:
- Does the product or service provide a cost-effective solution to a problem?
- Would you care enough for the product or service to buy it?
- Do you know anyone willing to buy the product or service right now?
If your answer to all the above questions is yes, then you might have something worth pursuing. You should then try to find out if other people think the same way.
Get feedback
You might think putting your great idea out there is risky because someone might jump in ahead of you. But talking to people who form part of your target audience can help you avoid wasting time and effort on something that simply won’t fly.
Online survey platforms, such as Jotform, can help you reach out to people outside your immediate circle. Jotform offers a free version with all features included, and it integrates with Facebook so that you can start getting feedback right away.
Use crowdfunding
If you intend to develop a book, gadget, tools, software, game, or service for which you can show a prototype or minimal viable product (MVP), an excellent way to validate demand is to put it on a crowdfunding platform where people can show their support for a particular idea.
Check out our definitive guide on how to crowdfund a business idea.
Do product research
If you plan to sell a product on Amazon, for example, that you source from a third party, the best way to find out if there is a demand for it is to do product research. Product research tools provide analyses and trends on the sales and performance of a particular product, so you’ll have a pretty good idea if your product is likely to sell on the platform at a nice profit.
The top Amazon product research tools are AMZScout, Jungle Scout, and Helium 10, with AMZScout being the easiest to use if it is your first time. These tools are specific to Amazon but worth investing in, considering the platform has the biggest e-retail market share in the U.S. at 41%. Also, the market insights you get probably apply quite well on other platforms, including an independent e-commerce website.
2. Define Your Target Audience
Ideally, you should conduct market research on your target audience, but it can be a sort of chicken-and-egg situation when starting an online business.
To conduct market research on your target audience, you need to define your target audience. To do that, you need to conduct market research.
Nevertheless, your preliminary research can be for the general market, casting a fishing line to see what bites you get with your bait. You can use that information to create buyer personas and identify your target audience.
The buyer persona typically includes the following:
- Name and title
- Personality, such as psychological traits, professional background, demographics, sources of information, awareness of your product, attitudes, and beliefs
- Challenges
- Goals
- Buying behavior
You can create your buyer personas quite easily with the right tools. Hubspot is among the best marketing tools for creating buying personas for small businesses. You can use the free buyer persona guide and templates to organize the market research information you gather.
Creating buyer personas is crucial to help you understand what makes prospective customers tick and their needs and concerns so that you can tailor your product development and services accordingly.
3. Write a Business Plan
Now that you have a viable business idea and a target audience that represents potential customers, the next step is to write a business plan.
If you’re groaning, thinking it’s like that despised term paper no one’s ever going to read, think again. A business plan is vital for the positive outcome of any online company because it outlines what needs doing to achieve your goals. Think of it as a roadmap from point A to point B in the quickest possible time at the least cost.
Business plans come in many flavors. For instance, if you want to start an e-commerce business, you might want to check out our guide for writing an e-commerce business plan.
Get started using our one-page business plan it.
4. Source Products
Some say you shouldn’t try to reinvent the wheel, especially not with your first product. But if you find a way to improve an existing product, you’ll need to go through a similar process. This includes finding a designer to draw the dimensions and look, and then have a prototype created.
To do the latter, you’ll need a manufacturer that’s willing to create your unique design. Ideally, you want to find a supplier that already sells a similar option so that they don’t have to create a new mold or other expensive iterations.
Next, order a sample and test it out. Once you approve the product, it’s time to order in bulk.
If you’re working with manufacturers on Alibaba, then make sure to find one with a gold star and a remarkable reputation. This way, you can avoid ordering from a subpar supplier. There are horror stories of receiving a superior sample, then the actual products are horrendous. So, be sure to consider reputation above price.
Here are tips for working with manufacturers on Alibaba:
- Look for verified and gold suppliers
- Search for positive feedback (at least 90%)
- Look at the minimum order quantity (MOQ) and rate to ensure it’s within your price range
- Find affordable yet high-quality suppliers
- Ensure your instructions are clear as many manufacturers aren’t native English speakers
- Pay attention to response speed — less than 24 hours is good, but less than 8 hours even better
5. Build Your Brand
A brand is more than a name and logo. It’s the first step to establishing yourself as a business. So, make sure you’re writing down ideas along the way. Once you have your name, see if it’s available as a domain on GoDaddy or another domain registrar.
Note that your business name doesn’t necessarily need to be the same as your brand name. You can also create a logo with free tools like Wix.
6. Set Up Shop
Now, it’s time to decide which e-commerce platform to use for your online store. Will you opt for Shopify? Maybe you want to sell on Amazon? What’s great about the former is that it comes with various templates to choose from — no designer or coding knowledge needed.
If you’re going with a single product, you won’t have to worry about creating a bunch of listings and product descriptions. Review competitor sites in your niche to get ideas on setting up your home and product pages.
Shopify also comes with necessary features that enable you to accept payments from credit cards and payment platforms like PayPal and Google Pay. Plus, you can sell on multiple marketplaces and even on social media.
Best e-commerce platform for beginners
Best e-commerce platform for beginners
The best to choose depends on your comfort with web development. If you’re new, then opt for the platforms we listed since they’re beginner-friendly. If you want to work with a professional, then here’s our list of the best e-commerce website developers.
7. Market Your Products
Now for the fun part — spreading the word about your new brand. Ideally, you want to start marketing your products before you launch. This way, on launch day, you have hundreds or even thousands of sales.
But don’t stress if it doesn’t turn out this way. Some see success build over time vs. in one day. So focus on generating buzz and traffic using:
- SEO: SEO is a strategy businesses use to get their web pages to the first page of Google and other search engines. It helps to increase traffic to your site.
- Search and social media ads: Using PPC ads is a paid method for getting more traffic to your website. This involves paying for keywords your target buyers use to search for your products.
- Influencer marketing: Find people in your niche with a semi-large following — 2,000 to 15,000 followers. Then, offer to collaborate — they promote your product in one or a series of posts for X amount of dollars.
Experiment, Reiterate, and Scale Your Ecommerce Business
Building an ecommerce business never ends — it requires constant experimentation to see what works. Reiterating to make improvements and see better results. By using this process, you can scale your online business to six or even seven figures.
But it all starts with following the above steps. Conduct thorough research, find your unique value proposition, and build your brand. The rest is up to effective digital marketing and advertising.
What To Do Next
Launching your online store from the ground up with powerful website builder tools helps in building a good foundation for a successful business online. It is easy when you follow the simple steps above. After thorough planning and determining your business’ branding and trajectory, bringing your business online needs a low-cost upfront that allows you to start in no time.
Invest in your business’ social media accounts and ensure that your website offers a good buyer experience and is easily accessible. Your social media engagement posts act as the storefront that represents your business in the online world. An organized social media management strategy using online tools is a game-changer for every e-entrepreneur. Be on the lookout for new e-entrepreneur tools that help businesses thrive online. These tools make your online entrepreneurial journey as smooth and enjoyable as possible.
