Research reveals that the internet has produced a lot of billionaires and millionaires, proving that online businesses are one of the most profitable ventures. So, your decision to build a successful online business could set you up for a future of financial freedom if you go about it the right way.
Building a successful online business involves several important steps.
Fortunately, we’ll be discussing the exact steps required to do so, especially if you’re a beginner with no idea where to start or what to do.
First, let’s look into what the online business is all about.
Online Business; What It Is & Examples Of Online Business Ideas
An online business is any business venture that seeks to serve its customers over the internet.
In other words, the majority of the business transaction (buying and selling) happens on an online platform.
When thinking of building a successful online business, there are different options available to you.
Let’s examine what these options are briefly.
Examples of online business ideas include;
eCommerce (Online Store)
This type of online business involves setting up an online store to sell goods online.
The goods could be your products or other people’s products.
It works more like a brick-and-mortar store where potential customers find and visit the store, select the desired product they want to buy, and pay for the product.
However, they’ll need to wait for some hours or days to receive the product physically.
More so, you’ll need a physical location to store inventory.
Overall, you’ll need a platform to host your online store and a device to operate the store.
This could be a computer, tablet, smartphone, and other smart devices.
This is also one of the successful online business ideas you can start.
In this business, you act as the middleman between a company and its customers.
With dropshipping, you can sell the goods at your own price (the retail price) and make lots of profits.
More importantly, you don’t have to stock up any inventory or take care of any logistics.
You advertise the goods on your chosen platform, an online store, or social media page with your desired retail price tag.
Then, the customer sees the products, orders, and buys at the retail price.
As the middleman, you forward the customers’ order details to the wholesaler/manufacturing company and process the order ( here, you pay the wholesale price).
Then, the manufacturer/wholesaler processes the order and sends it to the customer with the details you’ve provided.
Your profit is the difference between the retail (selling price) and the wholesale price (the buying price).
This is a commission-based online business model whereby you earn more from promoting other people’s products.
The commission percentage would usually range from 10% to 40%, depending on the company and the affiliate agreement.
Unlike dropshipping, you don’t have to stock any inventory.
However, here you can’t set your own retail price.
You sell at the company price.
This is a publication-based online business model that involves sharing content online with a defined audience with specific interests in the topic you’re sharing.
Owning a blog lets you share your experiences, knowledge, and relevant insight with your target audience.
This, over time, helps you build credibility and win their trust/ loyalty.
Overall, you can make money from your blog through paid ads, selling digital products, and monetizing website visitors.
This is a service-based online business that requires you to provide services to companies or business owners based on your skills.
It could be marketing, web design, programming, photography, etc.
You work on your own terms and offer your services as a specialist to companies.
Overall, these are some of the profitable online business ideas to inspire you while thinking of building a successful online business.
Another important thing to consider is the benefits attached to establishing a successful online business.
Let’s find out what these are.
Benefits Of Building An Online Business
Low Barrier To Entry
This is one of the significant benefits of doing business online.
Many aspiring business owners have had to give up their entrepreneurial dream due to high start-up costs, requirements to set up a physical store, or operational costs.
However, you can simply start an online business with your smart device, internet connection, and in some cases, a start-up cost of as low as $100.
You may not necessarily need to set up a physical location for your business or hire employees from the onset.
This low start-up cost and barrier to entry have given birth to so many online entrepreneurs.
Huge Customer Base
Another advantage that building a successful online business gives you is access to a huge customer base.
Unlike traditional brick-and-mortar businesses where you’re restricted to customers within your locality, you have access to a global audience with an online store.
You can find and connect with your target audience from anywhere around the world, allowing you to sell to more customers than a physical business.
Flexibility To Work From Anywhere/Anytime
Furthermore, you can work from anywhere and anytime with an online store.
Yes, you could have fixed working hours, but you can access your business from any device and anytime.
This gives you the leverage to work while you travel or from the comfort of your home/home office.
Most physical store owners have to close their shops anytime they go on a short trip.
However, this is not the case with online businesses.
Massive Income Potential And Scalability
With a huge customer base comes the opportunity to sell and earn more.
This is the possibility that building an online business offers if you channel your efforts adequately to the right activities.
More so, expanding your online business could be as easy as focusing your efforts on meeting a new need in your market.
However, with a physical business, expanding could be more expensive as you may have to pay for inventory, logistics, and hire more staff.
More importantly, building an online business could offer you the opportunity to create a sustainable passive income stream.
You can set up a business model that can allow you to earn money even when you sleep, e.g., an e-commerce store with an automated order fulfillment process, a digital product, a blog, etc.
Despite the many admirable benefits of owning an online business, it also has its challenges.
Challenges Of Starting And Running An Online Business
Anyone with a feasible idea can easily start an online business.
This has made it such a crowded marketplace with several businesses competing for the online audience’s attention.
Hence, making it difficult for beginners to easily attract their desired audience.
Marketing & Customer Acquisition
This is another major challenge you’ll encounter when building your online business, especially as a beginner with no idea of how digital marketing works.
You may find it difficult to promote your business and attract your ideal customers effectively.
Complex Metrics To Track, Analyze, And Understand
One of the tricks to building a successful online business is understanding the metrics behind your online platform, analyzing them, and tweaking your online business activities to suit those metrics.
Unfortunately, some of these metrics are complex and may be difficult to understand, especially as a beginner.
Most online businesses are undoubtedly profitable.
However, starting an online business is not a get-rich-quick-scheme.
So, it may take a while of consistent efforts in the right direction to start seeing significant results and massive profits, making it hard to quickly scale your business.
Now that you know the upsides and downsides of starting an online business let’s look into how to set up one for yourself.
Step-by-Step Guide To Building A Successful Online Business
1. Pick A Business Idea
Every business starts with an idea, even an online business.
Perhaps, you already have a physical business, and you’re looking to take your physical business online.
In this case, you don’t need to do this.
However, if you’re just starting your entrepreneurial journey with a desire to build a successful online business, you’ll need to come up with a business idea.
One of the best ways to come up with a business idea is to draw from your personal experiences and skills.
Another way is to look into your passion to see if it can be turned into a feasible business.
Alternatively, you could look around you for problems that need to be solved.
Finally, you could research online for profitable business ideas.
Earlier, we shared some of the different types of online business ideas.
You could refer to the list above to decide what type of online business you want to start.
Overall, when picking a business idea, make sure it’s something that interests you so that you can be fully committed to it.
2. Choose A Niche To Build A Successful Online Business
This is another crucial step to building a successful online business.
This step may sound like the first step, but they’re different.
In the first step, you get to pick a general topic of interest( the idea).
However, here, you need to be more specific about what you want to do (niching down).
Being more specific with your business idea will help you set up a business that appeals to a specific segment of the market, making things more efficient and manageable.
For instance, say you’ve decided to set up an e-commerce/online store.
You’ll need to decide what your e-commerce store will be about; gadgets, women’s fitness wear, home decors or accessories, etc.
3. Make Sure There’s A Market For Your Idea ( Identify Your Target Market)
This third step to building a successful online business is about making sure people are interested in what you have to offer.
Every business exists to fulfill a need in the market/solve a problem for its customers.
Hence, you need to ensure that your business idea also meets this criterion.
So, you’ll need to do thorough market research to identify if there’s a place for your business idea in the market.
During your research, watch out for customer pain points, what they’re saying about your industry, and the questions they’re asking.
4. Research Your Product/Service
Next, you should research the product or service you’re bringing into the marketplace.
At this stage, what you want to find out;
- If there’s a demand for the product/service.
- If there is, what’s the level of the demand; the higher it is, the better for your business.
- How much are people willing to pay for your products/services to satisfy the demand.
- Are there already similar products/services to yours? If yes, what’s the level of market saturation.
- Also, what complaints do people have about existing products/services.
Overall, researching your products/services is necessary to help you develop a unique selling proposition that will give you a competitive edge.
5. Research Your Competitors
Like most traditional businesses, they’re several business competitors in the online space.
You aren’t the only one with an idea to tap into the business opportunities that the internet offers.
So, do your due diligence to learn a thing or two about your competitors.
First, you want to know who they are and what they do.
Also, you’ll want to find out how they do what they do, especially if they’re successful at it.
Likewise, you’ll want to find out what they’re neglecting to do.
Researching your competitors can help you learn what you need to do to make your online business successful.
More importantly, it can help you discover your competitive edge.
6. Create Your Online Business Goals, Plan & Strategy
Also, you need goals, a good plan, and a strategy to build a successful online business for several reasons.
Firstly, without clear goals, there’ll be no direction, and it will be difficult to track progress.
More so, without an effective plan/strategy, it won’t be easy to actualize your goals.
To help you set goals for your business, you need to be clear on what you want for your business.
Naturally, your online business goals will fall along the lines of; creating brand awareness, increasing customer engagement, loyalty and retention, increasing sales, etc.
Once you’re clear on what you want to achieve with your online business, you need to identify the most efficient ways to achieve them.
This will form your action plan and strategies.
Ideally, your action plan should involve specific activities with fixed execution timelines.
Finally, your strategies should align with your overall business goals, and they should be effective in getting you your desired results.
7. Choose & Set Up Your Online Platform; How To Build A Successful Online Business
Now it’s time to pick a home or a virtual location for your online business.
Depending on the type of business, it could be an e-commerce store, a social media page, or a website.
Whatever platform you choose, there are certain things to keep in mind;
- It should be suitable for your type of online business.
- Also, it should be simple for you to understand and operate. It’s best to keep things less complicated as a beginner.
- More importantly, it should be simple for your target audience to interact with.
8. Get Started
This is the final step in building a successful online business.
Getting started could be as simple as creating/designing your website.
It could also be registering your online store or creating a social media page.
Fill out the necessary details and get started.
Setting up your online business is only part of the work.
What you do afterward also determines the success of your online business.
Given so, here are some helpful tips for online business success.
Tips For Running A Successful Online Business
Deeply Understand Your Customers
Understanding your customers will help you cater to their needs effectively, leading to more sales in your business.
So, always research and gather insight into your customers’ behavior.
You can do this by sending out survey forms to your target market.
More so, you could check for insight on forums like Quora, Reddit, Facebook, etc., where your customers interact with each other and share their pain points.
Focus On Serving & Adding Value
Every business exists to make a profit.
Yours should, but that shouldn’t be your sole aim.
Customers are more likely to trust and buy from businesses they believe are genuinely interested in solving their problems.
This is the position you want to be in as a business.
So, focus on solving your customers’ pains and adding value to them consistently.
This way, you’ll win their trust, and selling to them will be much easier.
Update Yourself With Latest Online Trends & Implement
The online world is constantly evolving, thanks to technology.
These technological trends also affect how online users interact with different online platforms.
Even more, online platform metrics are constantly reviewed to fit the changing online user behavior and needs.
So, you should keep yourself updated with some of these changes and implement them where necessary.
Promote Your Online Business
There are dozens of online businesses seeking online users’ attention.
Hence, you’ll need to put in a little bit of work to draw attention to your business and what you offer.
For this, you’ll need to implement effective marketing techniques and strategies, some of which include;
- Paid ads
- Content marketing
- Social media marketing
- Email marketing
- Affiliate marketing, etc.
Apply Best SEO Practices & Techniques
SEO is a vital part of online success.
This is because it organically puts your business in front of your target audience when done rightly.
Some SEO best practices for online business include;
- Targeting specific and low competitive keywords in your industry with your content marketing activities.
- Optimizing your page/site’s performance for quick load times.
- Including relevant keywords, people use to search for your business in your content, etc.
Overall, you can always learn and implement relevant SEO best practices.
Alternatively, you could consult SEO professionals to help you with this aspect of your online business.
Manage Your Time Effectively
Starting your online business also requires managing your time effectively for optimal efficiency and productivity.
Of course, you’ll have the flexibility to work anytime as an online business owner.
However, for maximum efficiency, you need to work at your most productive hours and minimize distractions so you can complete your tasks.
Stay Focused On Your Goals And Be Patient
Online businesses are profitable.
However, these profits won’t come in immediately.
So, you’ll need to maintain focus on your overall business goals and trust the process.
As long as you’re putting efforts in the right direction, be patient enough to see your efforts yield maximum results.
Conclusion; How To Build A Successful Online Business
Now, you know the exact steps to take to start your online business.
You also have some helpful tips for online business success.
It’s left to you to implement these steps and achieve your desire to build a successful online business.
Here’s to your success.