If you plan to start an online business, you’ve got quite a road ahead of you. Just like any other business, you need to start by creating a business plan that will guide your operations. However, since you’re selling online, this business plan will be tailored to a largely virtual presence. The following list details some of the major topics you should consider when establishing an online business. These topics are in no way a substitute for a fully fleshed out business plan, but they should take up a large amount of your focus.
What is your brand all about?
What are you planning to you sell? If you’re a reseller and your strength is sourcing a niche selection of goods, your strategy is going to be far different from if you were a manufacturing or crafting something yourself.
The type of product that you’re selling will have a significant impact on the websites you incorporate into your overall online selling strategy. So, you need to hammer out your initial product offering before moving on.
Once your initial product offering is set, determine your offering can be differentiated from what already exists online. The entire online marketplace is more vast than most businesses will ever need. That vastness speaks to the number of alternatives buyers have to your products. If you don’t have a solid product that differentiates itself, a higher quality of service that differentiates your brand, or a digital marketing strategy that makes your brand highly visible, it’ll be tough for you to find success online.
Who is in the market for your goods?
Once you’ve established your product offering, you need to start looking around for your market. If possible, you want to determine what social media platforms, marketplaces, blogs, forums, and other websites your market is on.
One way to go about doing this is to identify where your closest competitors have a presence. Since you will have already determined your competitors in the previous step when you were establishing your brand and points of differentiation, you should already have a list of competitors. Use the list that you created to create a competitor analysis that details their online presence. This should give you a substantial amount of information on where your market is and what digital marketing strategies your competitors are employing. We’ll come back to digital marketing strategies in a bit.
Next, you want to get as personally active in the buyer community as possible. Being that you’re starting your business, you likely don’t have the resources to conduct a thorough market analysis or to hire a firm to do one for you. So you need to get into the mind of your buyer as much as possible. That’s where exploring social media platforms, marketplaces, blogs, forms, and other websites related to your product offering comes in. Explore these sites as if you were a consumer.
As your exploring the online marketplaces and related websites, seek answers to the following questions. What social media platforms is your market active on? Which marketplaces have a large similar offering to what you’re trying to sell? Are there marketplaces that have complimentary offering to what you’re trying to sell? Are there any unique social media or marketplace opportunities that your competitors have not yet exploited? All these questions should be explored, answered, and worked into your online selling strategy.
Do you know a web developer?
Though you may be able to create your own website with any of the eCommerce development websites currently available. A good web developer can guide you through selecting the eCommerce development tool that is best suited for you and your business. If you’re lucky, they may have some insight into what social media platforms. And if you’re super lucky, they might know which online marketplaces would be best suited to your product offerings.
So if you can, find a web developer friend, cofounder, or reasonably priced web developer consultant because you need their assistance badly. If you’re hopping into this alone and/or with minimal experience, you’ll want to do a substantial amount of research before purchasing domain names, inventory, equipment, etc.
What mix of online marketplaces and stores will you use?
There are a growing abundance of marketplaces and tools to create your own online stores. Over time, you want to use an optimized combination of these channels that maximizes your profit. For now, study the product offerings and culture of each of these categories to determine what’s the best fit for your business.
The first three sets of websites are all forms of marketplaces. Explore and analyze each one, keeping in mind their product offering, market reach, and ease of use for seller, and ease of use for buyer.
- General Online Marketplaces – The following marketplaces have the largest variety of offerings and tend to be geared towards non-hand crafted products. Each website has its own look and feel (UI), community, seller benefits and features, and product offering. You’ll want to investigate each to determine which one is the best fit for your company.
Other non-handcrafted-good marketplaces do exist online. But these are the first ones you should consider before moving onto more niche, obscure, smaller reach websites.
- Bidding marketplaces – If your business lends itself to having customers bid on your products, then you’ll want to consider eBay and eBid. Both websites have bidding and “buy it now” functionality. Through the “buy it now” function, they can function like the other marketplaces. However, having a store on either of these sites change your brand’s image. So, you’ll want to strongly consider your brand’s image before making the leap onto either of these two sites.
- Handcrafted, artsy marketplaces – These marketplaces are geared towards crafting and designing your own goods. If this is your sphere, you’ll want to shop around to find which sites fits your business’s personality best.
The last two sets of groups are for building your own website. However, not all online sellers will build their own websites. Some will stick to marketplaces. Some will even stick to one marketplace. If you can diversify your revenue streams i.e. successfully sell our products on more than just website, then you should. Marketplaces can ban you, so you prepare backup strategy in the form of other selling channels.
- Create your own online store – These websites are specifically geared towards creating eCommerce stores.
- Websites with shopping cart capabilities – These websites are geared towards creating a website and have the capability of assisting you in creating your online store.
These lists are in no way exhaustive of the marketplaces and online store creation tools available online. However, these sites are some of the most used and most talked about ones, so check them out before turning to anything more obscure.
Using this article as a guide, you should be able to outline your brand, product offering, product sourcing, target market, and channels. After that outline is complete, you want to start thinking about your social media presence, cross-platform promotional strategies, and software for managing operations. If you want more information on those topics, check out my upcoming blog posts.