From eCommerce to coaching, online businesses have proven to be a profitable endeavor. The benefits are countless: lower overhead costs, a much broader audience, elimination of time constraints and the comfort of working from anywhere in the world. More and more people are choosing the internet as their way of business. Ecommerce platforms offer options and support and setting up becomes easier by the day. As with any business, there are important aspects to consider before making the leap.
Choosing a platform
Is it better to have your own storefront? Maybe your products will sell better in the marketplace? It mainly depends on the product. Some items, such as used goods, might be a better fit for established marketplaces that offer some advantages. Starting within a marketplace may be a better way to protect yourself while selling online as you build a reputation because most of them offer seller protection. Other aspects to consider:
- Shipping: does your selected marketplace or platform offer shipping alternatives? Think about costs and easiness of service and use an estate planning for your future. Some might be more expensive but pick up packages at your doorstep. Evaluate according to the product you want to sell.
- Payment gateways and options: What type of payment options does the platform support? Do they have a payout minimum? What about payout dates?
- Exposure: Smaller platforms tend to perform better for niche products. But if you are planning on selling a wide variety of objects, you may find it better to choose a platform with a wider audience.
- Seller support: how does the platform support sellers? Do they offer technical assistance or mediation services in case of an issue with a client?
Advertising
As with any business, one of the first and most important steps is to get the word out. How will your audience know about your product? Ideally, you have a business plan, and it includes a clear definition of your target market. With this in mind, start looking at your options:
- Does your marketplace include paid advertising options? This might be the best way to start as you want to position yourself inside the space that you chose for selling.
- Social Media: From niche platforms to the giants such as Pinterest or Facebook, which one best suits your needs? Where does your target audience spend most of their time? Social media advertising is cheap and straightforward, but there are also some certain pitfalls.
- Search Engine Marketing: placing ads on search query results may have a big impact, but it will depend on your target audience.
Compliance
A common mistake when starting an online business is thinking that there are no rules to follow. Most countries have strict regulations when it comes to online businesses. Find information about what makes more sense to you. Will you incorporate as an entity or is it better to be a sole proprietor? How will you deal with taxes? Another aspect that is sometimes overlooked is related to trademarks and intellectual property. Before selecting a business name, you might want to run a search for trademarks to avoid future problems. More information about the legal aspects of a home-based business can be found here.
The biggest mistake that newcomers make is to believe that an online business should not be treated as an actual business. Starting with a business plan with a financial statement and a clearly defined market is always the first step. Market research is also of the essence: are you certain that your product is something that your market needs? Will you need to overcome important boundaries before you can make a sale? A solid financial plan will give you data on how much do you need to invest in order to succeed, and when you will reach your break-even point. You may want to reach out to mentors or business incubators who can help with the first steps.