August 4, 2017
We know the rate at which brick and mortar businesses fail because they need to set up shop, literally. The number is around half. It is more difficult to determine what percentage of online businesses fail; we know at least that many fail because of bad website design, a failure to plan on how to make enough money from what they want to sell, issues with taxes and not being found by the customers who matter most. Here are five steps to establishing a successful online business.
Pick Your Niche
What are you going to sell? What will you offer that isn’t already done by a thousand other sites? Pick your niche before you do anything else, because this determines your marketing strategy, your website design and monetization scheme. It will determine your ideal customer and thus how you will promote your product or service to them.
Develop Your Monetization Plan
You need to develop your monetization plan. Know what you sell and the price at which to sell it to cover operating expenses, material costs, labor costs, insurance, taxes and other budget items. Your first step is offering an initial product or service that will earn enough money at a modest sales rate to pay the bills. It should be simple, since successful complex processes only arise for successful simple ones. So, don’t make a business plan that looks like a spaghetti chart but instead a simple, direct sales and delivery system of one or a few items or services. You can always expand later, if the initial plan is a success.
Influencer marketing has several points in its favor. Unlike celebrity endorsements, influencer marketing is considered more authentic and believable. Second, for your business, it is attractive because it is relatively cheaper than a brand name star. Third, influencers have social media expertise your fledgling business doesn’t, and when you connect with them, they’ll be able to promote your brand online far beyond what your own marketing team could. Fourth, each influencer has a very well defined audience, so once you know who your ideal customer segment is, you can select several influencers whose following matches your ideal customer profile and work with them.
Build an Audience
An online business cannot rely on traffic to result in customers the way a restaurant on a busy street will receive a few walk-ins just based on curiosity. Your online business must build its audience. This is one reason why you need to publish content marketing that attracts a wide audience even if it doesn’t convert a whole lot of them. The free content acts as the first step in the sales funnel. Another way to build an audience is to guest blog for major websites, demonstrating your expertise or tactfully promoting your business or service, but the main purpose is getting your name out there.
Yet another approach is being featured in the news, since this results in high authority backlinks to your site and positive press from reputable sources. Entrepreneur Tai Lopez is the perfect example of using press to build your brand. For example, in this article about Tai Lopez, a featured piece on Forbes, the story about him personally and his businesses was read by millions of people and resulted in more brand building than a massive SEO campaign.
Test and Refine
You’ve set up the online website, and it is generating sales. You can add other products once you have started generating the necessary, baseline cash flow. After you have solid sales, then you can afford to test complementary services, product bundles and third-party products sold through your site. Once you have a search engine optimization strategy that is generating steady traffic flow, you can begin A/B testing of landing pages and content marketing to increase traffic or improve the customer conversion rate.
Pick your niche, what you will offer that is different from what is already out there. Develop your plan to monetize the product or service; in short, figure out how you’ll make money and how you’ll deliver the product or service at a price point that pays the bills. Find influencers whose following matches your best customer demographic. Build an audience through these influencers and through strategies like content marketing. Once you’re up and running, then and only then can you afford to test and refine the business strategy.
Peter Davidson works as a senior business associate helping brands and start ups to make efficient business decisions and plan proper business strategies. He is a big gadget freak who loves to share his views on latest technologies and applications.