f you've ever thought of starting your own online business, there’s no time like the present. In 2020 alone, more than two billion people purchased products or services via ecommerce stores. During the pandemic, when the appeal of brick-and-mortar stores significantly declined, prompting many stores to close their physical locations, people relied on online shopping to meet their needs. To a large degree, this cultural shift is here to stay. Whether you’re looking to earn a passive income through a steady side hustle or you’re currently out of work - or even considering escaping the daily grind of a 9-5 to be your own boss instead - starting an online business is a fantastic solution. Continue reading for online business ideas and essential steps to take so that you can build a successful online business.
Online Business Ideas
There are hundreds of ideas to choose from when launching an online business. Some may require more knowledge starting than others. Consider startup costs as well: you'll need to consider how much money you can invest in your business up-front. Here are some online business ideas to spark your imagination.
- Affiliate marketing
- App development
- Book writing
- Business coaching
- Career coaching
- Clothing design
- Digital advertising
- Freelance writing
- Grant writing
- Graphic design
- Handmade goods
- Life coaching
- Marketing consulting
- Online artist
- Online teacher
- Public relations consulting
- Resume writing
- Social media marketing
- Software development
- Tech support
- Travel planning
- Video production
- Virtual assistant
- Website design
The sky's the limit when it comes to online businesses. If a business idea doesn't exist yet, even better! You can create it.
How to Start an Online Business
How you start a business online depends on the type of business you plan to launch, among other factors. However, there are certain steps you can take that apply to nearly every online business owner. Below are twelve steps to consider as you pursue launching a successful online business.
1. Determine your Business Idea
The first step as a new business owner is to determine your startup idea. If you have an idea already, great! If not, take time to do your research. One of the best places to start is discovering a need and then figuring out how to create a product or service that fulfills that need. What problems keep coming up for you or others that haven't yet been solved?
2. Do Market Research
As you continue to develop your business, take time to do your homework. Poll people on problems and pain points. Do keyword research to see what questions people are asking. Use your network on social media to ask questions, pinpoint customer needs and how you might solve them, and gauge interest.
3. Identify your Target Audience
It's also important to determine who you're trying to reach with your online store’s product or service. Consider factors like:
- Marital status
- Content consumption habits
Trying to target everyone is likely to leave you missing the mark. Narrow your focus to a specific target audience. You'll still sell to people outside of your target market, but your audience will become the focus of your marketing efforts, and they’ll be more likely to buy your product.
4. Name your business
Your business needs a name. Choosing a name might be incredibly easy or difficult, depending on your thought process. As an online business, there are three questions you should ask before settling on a name:
- Is the business name available in your state?
- Is the website domain name available?
- Is the username available on social media platforms?
5. Develop a Business Plan
Create a comprehensive business plan that walks through your entire business idea and business model. Components to address in your business plan include:
- A mission statement or business objective
- A description of your ecommerce business
- A description of your product or service
- A sales plan
- A marketing plan
- Business management strategy
- Financial plan
Having a solid business plan helps you create clear goals and objectives for your business and how you plan to achieve them. A business plan also comes in handy if you ever decide to add investors. Your business plan doesn't have to be perfect. Write it now and refine it later.
6. Make it Legal
This step may not be as fun as others on the list, but tackling all of the legal aspects of running a small business now will make your life much easier later on. First, you need to decide on your business structure. Options include a sole proprietorship, a partnership, a Limited liability Company (LLC), or a Corporation. The structure you choose determines the legal requirements you must meet. Like any business, you may need to online business and file necessary legal and tax documents accordingly. Check to see if you need a permit or license to operate your business. Check local, state, and federal tax guidelines to make sure your business meets requirements. Depending on your business structure, you may need to file for state or federal ID numbers.
7. Sign Up for a Business Bank Account
It’s vital for every business owner to sign up for a bank account dedicated exclusively to their ecommerce business’s funds and expenses. Having a business bank account is vital to business management, from bookkeeping to taxes and everything in between. It’s much easier and more time-efficient to run your online business when you have a dedicated place to store this information. Speaking of taxes, a business bank account will help you find deductions in your finances much more easily. Plus, you’ll limit your chances of getting audited. Finally, having a business bank account will make your small business look more legitimate and professional. Not all business banking platforms are created equal, so it’s important to find one that works for you and your small business. Many banks charge hidden fees, and they may even have minimum balance requirements. You’ll also want to make sure you choose a banking platform that will connect with your payment processor or ecommerce platform such as Shopify, Amazon, Ebay, or Etsy. Novo, for example, charges no transaction fees and has no minimum balance requirement. Plus, it’s incredibly easy to sign up. Create an online business banking account with Novo. Novo is a fintech, not a bank. Banking services provided by Middlesex Federal Savings, F.A.; Member FDIC.
8. Build a Website
Since you're launching an online business, take time to create an online "home base" for your business. Social media and email marketing are great for getting the word out, but someone else owns those platforms and can make changes at any time that could affect your business. Having a solid website gives you a place online to direct customers to and sell your products or services. You can hire a web designer for your ecommerce website, or you can do it yourself. Spend time creating compelling copy that clearly communicates your vision and answers your customer's questions and objections. If your website includes other content, try to optimize it to draw more traffic towards your site. Plus, make sure to keep the domain name simple so that potential customers can find you easily.
9. Create a Marketing Plan
Your business also needs a marketing plan. How do you plan to market your business to sell products and services? As an online business, your focus should stay online, using social media, email, and video to market your business. Think about your target audience and how they consume content online. Focus on the platforms they use regularly. If their free time is spent primarily on Instagram, don't pour resources into Facebook. Instead, create visually stunning content in line with your brand to engage with your audience.
10. Learn about SEO, or Search Engine Optimization
With any online business, it’s essential to optimize your website, social posts, and/or product listings for organic search. There are significant SEO opportunities for an ecommerce business since you’re primarily focused on online marketing. When you optimize your website for google search, your aim should be to get as many potential customers to visit your pages as possible. SEO doesn’t stop there: consider whether you have any other platforms you can optimize. For example, you may sell on ecommerce platforms such as Etsy, Amazon, Shopify, or Fiverr. Or, you may want to consider optimizing your posts on social media such as Instagram, Youtube, or TikTok in order to increase brand awareness. Where you choose to prioritize search engine optimization will depend on whether you’re or using your own website, an ecommerce platform, or social media to sell goods and services. As a new business owner, leveraging SEO is essential to growing your clientele and sourcing new subscribers, clients, or buyers.
11. Launch Your Online Business
At some point, you'll need to channel your inner entrepreneur and finally launch your business. While there's no physical storefront to open, your online business still deserves a proper launch. Create a marketing strategy around your launch to get people excited about your products or services. Think about how you can use your email list, social media, and advertising to draw in the right people to your business.
12. Evaluate and Adjust
Once your online business launches, it's time for the real work. This is when you discover any issues with your business, website, products, customer service, marketing, and other parts of your business. How you respond to those hiccups may determine whether your business thrives or not. Continue to get feedback from customers so you can optimize your ecommerce business for success. Launching an online or ecommerce business can be time-consuming, and even difficult to navigate at times. At Novo, we aim to make it easier than ever to be an entrepreneur and a small business owner, with an abundance of information on our blog and a customer support team who’s always willing to help. Check out some of our other blog posts if you have any other questions. Happy selling!