According to the most recent online business statistics, 2023 may be the best year to start an online business (or start thinking about one side of business). Since the COVID-19 pandemic, the volume of online sales of both products and services has increased dramatically.
So, if you\'ve been thinking about becoming an entrepreneur for a while, now is the time to take action!
How to Launch an Online Business in 7 Easy Steps
Our mind dislikes lofty objectives. It\'s a natural \'defect.\' However, it prefers paced step-by-step instructions.
In this guide, we\'ll break down the entire process of starting an online business into simple recommendations.
So that when you\'re finished, you\'ll know how to generate a viable online business idea and turn it into a full-fledged, growth-oriented enterprise.
1. Choose a Lucrative Online Business Idea
First and foremost, you must identify your business niche and then narrow it down to one online business idea.
How do you do that when your mind is racing with too few (or too many) ideas?
Consider each option from three angles:
- Do you have any skills that you can monetize? Or are you open to new experiences? Consider website development.
- What are you interested in but have never had the opportunity to do for work? While passion isn\'t the main\' criterion for starting an online business, it will help you stay motivated in the early stages of your venture.
- Market depth: Is there sufficient demand for what you intend to offer? Scissors for lefties may appear to be a good product at first glance. Aren\'t there a lot of left-handed people who need to cut things? However, if that is your only product, you may struggle to build a large enough customer base.
This quick evaluation should assist you in prioritizing several business models. You can then develop your ultimate business concept from there.
Or follow one of our recommendations.
10 Lucrative Online Business Ideas:
We will go over ten ideas for a profitable online business idea to start with.
Let us begin with eCommerce.
1. Set up an online store
Set up an online shop using an out-of-the-box eCommerce website builder if you know how to make or where to find some nice products. Purchase or create inventory, list your products, begin marketing your store, and watch your sales skyrocket.
- Scalable business concept — start small and scale up
- High earning potential — you just have a sales cap.
- Low startup costs when compared to brick-and-mortar stores
- Inventory management and shipping can be challenging.
- In some niches, competition, and saturation are increasing.
- To remain profitable, you must have a solid business plan.
Learn how to start an online store.
2. Create a Dropshipping Business
If you don\'t want to deal with inventory management and logistics (both of which are expensive and time-consuming), you should consider dropshipping.
A dropshipping model involves locating a reputable supplier/manufacturer who is willing to ship products on your behalf, under your brand. As a result, you will only be responsible for maintaining your eCommerce website and marketing it to a larger audience.
- There are no inventory management costs.
- Low to no logistics costs
- This can be a good source of passive income.
- Shipping may take a long time if your partner is located abroad.
- Finding a high-quality supplier is difficult.
- Increased likelihood of selling the same products as your competition
- Profit margins are shrinking.
3. Online Marketplaces are a great way to sell your products.
Online marketplaces can be a good place to start for those who are not yet prepared to invest in the development of an eCommerce website.
eBay, Amazon, Noon, and a bunch of niche marketplaces attract consumers in a ‘shoppable’ state of mind. So you have a higher chance of making a sale without heavily investing in marketing.
- Low entry barrier — you only need to create an account to begin selling.
- A great place to start for a part-time side hustle.
- A good starting point for testing the demand for various products.
- Constant rivalry with other sellers/products
- Fewer opportunities to retain and remarket to customers
- Lower profit margins because you must keep your prices competitive and pay the platform a percentage of each sale.
4. Make and Sell Digital Goods
Physical product sales entail numerous operational risks in terms of quality control, shipping, and deadstock. There are none of these in digital products. You create a product line once, list it all on your website, and send a download link to each satisfied customer.
What kinds of digital products are in demand? Lots and lots:
- Workbooks and eBooks
- Checklists and templates
- Stock images and videos
- Music, jingles, and sound effects from stock audio
- Online workshops and webinars
- Printable posters and other materials
- Fonts, graphics, and digital art
- Access to knowledge repositories/communities
- Quick time-to-market (and to-profit)
- There are no inventory management costs.
- A high likelihood of becoming a passive income source
- Because the competition is fierce, you must constantly market your products.
- Be prepared to protect your digital assets from unauthorized distribution, copycats, and fraudsters.
5. Start Your Own Online Course
The global e-learning market is expected to reach $457.8 billion by 2026. E-Learning is the delivery of instructional content via electronic technology, such as compact disks (CDs), computer-based training (CBT), or Web-based applications.Source: ReportLinker
That\'s a lot of money up for grabs! Especially since most of us are unlikely to return to in-person education anytime soon.
So, if you are an expert in a particular field — whether it is home remodeling, card tricks, or SEO — think about \'packaging\' your knowledge into an online course or workshop series. Then, to attract student sign-ups, list your e-course on your website or one of the popular eLearning platforms.
- In-demand and popular online business concept
- High earning potential without the need for a consistent time commitment
- A rewarding idea for enthusiastic educators
- Without an existing audience, it can be difficult to sell out an online course.
- Not all skills are in high demand.
- It may take some time to develop and refine a course structure.
6. Create and market website themes, plugins, or software.
We always say that coding is a necessary skill in the modern world. Not only will you learn how to build things for yourself, but you will also be able to monetize this skill in a variety of ways, including selling some of your \”works\” or providing web development services to others.
For example in the case, if you know HTML and CSS, you can easily create custom WordPress themes and plugins. And then sell them to others again and again. Alternatively, if you learn another coding language (for example, Python), you can create more complex apps for sale.
- recurring revenue stream
- Time commitment is minimal.
- An excellent side hustles with room for expansion.
- Unless you hire a development team, scaling this business will be difficult.
- The software must be patched and maintained on a regular basis.
- Prepare to deal with customer troubleshooting.
6. Become a Web Developer or Designer
The need for website developers is not going away anytime soon. So, if you learn to code and/or design websites, you\'ll almost certainly never be out of freelance or full-time work.
- Service niche that pays well and is in high demand
- There are a plethora of interesting and diverse projects to choose from.
- Excellent opportunities for professional advancement
- Learning curve — you\'ll need to work on improving your coding skills all the time.
- Competitors include other freelancers and agencies.
7. Offer Application Development Services
Another profitable online service niche with rising demand is app development. Especially if you can work with cutting-edge technologies like AR/VR or 3D. Aside from developing apps for others, you can also launch personal products as a side hustle.
- Excellent pay, especially for specialized technical skills.
- If you\'re creating B2C products, you\'ll have a lot of fun at work.
- Possibility of creating a passive side income stream
- Again, you must constantly work to improve your abilities.
- If you work alone, you may not always be hired on the most exciting projects.
- Small-scale app development projects are frequently repeated.
8. Provide Services in Digital Marketing
SEO, copywriting, conversion optimization, social media marketing, and pay-per-click ads are just a few of the roles and sub-niches available in the online marketing space.
What\'s more, you can narrow down your specialty by business type. For instance, you could specialize in email marketing for eCommerce businesses. Or, for SaaS companies, blogging, and content marketing.
Marketing specialists (rather than generalists) can command higher rates and are unconcerned about the demand for their services. After they have worked hard to develop a personal brand.
- Because of the pandemic, most businesses shifted their advertising budgets online, so there are plenty of well-paying gigs available.
- Capability to work with various companies and learn the \”inside\” of various marketing departments.
- Work that is flexible and contract-based, with lots of room for advancement.
- Pricing your services can be difficult at first because there are no industry standard rates.
- To ensure a steady stream of clients, you\'ll need to invest in a strong personal brand.
9. Become a Virtual Assistant (VA)
A job as a VA may be right for you if you have strong digital literacy skills and can manage your time well.
Virtual assistants assist entrepreneurs and small business owners in sorting through a slew of administrative, operational, and occasionally marketing tasks.
As with online marketing, you can easily niche down to attract a larger pool of clients and command a higher rate.
- An excellent start-up\' online business concept
- You will have numerous opportunities to learn.
- Part-time or full-time work is possible.
- If your \'boss\' isn\'t great, the job can be stressful.
- The competition for \'generalist\' VAs can be fierce.
- The pay isn\'t always great (unless you specialize!)
10. Launch a Coaching or Consulting Firm
Experienced professionals may want to skip the service part and instead focus on coaching or consulting.
Consultants, in fact, can easily command twice the hourly rate of a regular contractor and secure long-term, high-paying gigs.
To succeed with an online consulting business, you will need some \'bragging\' rights. Consider case studies from previous clients, quantifiable outcomes you achieved for businesses, and other accolades, provided you know how to \'walk the walk\' as well as \'talk the talk.
- Even for part-time work, the pay is very good. Opportunity to (net)work with industry leaders
- High potential for scaling and diversification — you can start an agency or sell some of your knowledge as an online course or another type of digital product.
- This is not a good online business idea for beginners.
- The requirement for a strong and memorable personal brand
- Client acquisition can be difficult without a strong personal network.
2. Determine the viability of your business idea
So you\'ve got a few ideas based on your skills and interests. Now you should look more closely at the third factor — market size and demand — to see if your business can actually make money.
Here\'s how to assess the viability of an online service or product:
Conduct a Quick Online Market Analysis
The goal of market research is to assist you in understanding:
- Who is your ideal client?
- What are their preferred products or services?
- Where do they look for these services?
- In your market, who is currently meeting their needs?
Assume you want to be a web developer who specializes in restaurant websites. Because you enjoy cooking as well.
On the surface, millions of restaurants may require a new website or website maintenance services. So, should you message each of them with a job offer? No, your chances of finding work this way are extremely slim.
Instead, here\'s what you should do:
- Determine your ideal buyer. As a beginner, you might prefer to target smaller, mom & pop establishments rather than national chains.
- Examine the market\'s current demand. A growing number of restaurants now provide delivery or curbside pickup. As a result, they may be looking for someone who can design a new menu or set up an online ordering system for them.
- Investigate your customers\' needs and pain points. You can join an online community of restorations and look around to see what they\'re dealing with and if there\'s anything you can do to help.
- Make a list of your unique value proposition. Based on your research, create a 1-2 sentence sales pitch that speaks directly to the needs of your client. For example, \” I use Wix to create websites for restaurants, design online menus, and create a secure online ordering experience.\”
This market research framework is applicable to any other online service or product company.
Conduct a competitor analysis
Let\'s face it: lucrative online business ideas are also competitive.
If there is a high market demand for a service or product, there will almost certainly be others offering the same or similar set of services.
As a result, you should conduct a quick investigation into your competition to determine how you can distinguish yourself from them.
- Examine the main services/products offered by others.
- Make a list of the prices to get a ballpark figure.
- Take note of any \'add-on\' services.
- Look for missed opportunities,\' which are gaps in the market that you could fill.
- Determine various sub-niches within your primary niche.
- Examine Google Trends data to learn about changes in demand.
Summarize your findings and compare them to your initial proposals. What can you improve on? What complementary services/products can you offer? What skills or qualities set you apart from the competition?
Consider your answers to these questions and include them in your business positioning statement.
Returning to the example, you can say:
\”I provide web design and development services to restaurants in Dubai.\” Using Wix, I can create online menus and a secure online ordering experience. Prices for websites begin at $1,500. As an avid cook and photographer, I can also assist in the photography of delectable photos for your menu and other marketing materials, as well as the design of a logo and custom graphics.\”
3. Select a Business Name
It can be difficult to come up with a website name.
After all, you want a brand name for your online business that:
- Cup Props does not sound as nice as cupprops.com as a URL.
- Is simple to remember and enter into the search bar
- Registering a domain name does not cost an arm and a leg.
- It has a nice ring to it and describes what you sell or do.
- It does not infringe on any registered trademarks or other businesses.
- The name is also available on social media under the name @name.
Using a domain name generator is the simplest way to come up with a good online business name.
Type in some keywords e.g. ‘cup’ and ‘tea’ and then get a list of available domain name suggestions.
If the .com choice is taken or too expensive, try mixing things up. Your business name can partially match your domain name.
- Business name: Ritvon Digital LLC
- Website name: ritvon.com
Still, stuck with naming?
Here is the domain name generator we recommend:
4. Make a website or a landing page.
A website is required to run a successful online business.
You can, of course, sell your products or services on online marketplaces. However, you will be passing up a plethora of opportunities (and profit!).
To put that into perspective, if you create a professional website, you can earn nearly $28,000 more per year.
Do you like the sound of that? So, let\'s get you started.
Here is a step-by-step guide to creating a website.
5. Register Your Online Business
If you intend to conduct business under your legal name, such as as a service provider, business registration is not required. However, if you do not register with your state, you may miss out on certain tax, legal, and liability protection benefits. In either case, it is preferable to consider it once your business has gained traction; you don\'t need to be concerned when you\'re just getting started.
Important: We cannot advise you on all regulations because they differ from state to state (and country to country). So double-check all of the information locally!
To become \'official,\' you usually only need to register your business name with state and local governments.
Regulators understand your legal entity name by \'business name.\' According to the Small Business Administration, most regulators will register you without question if you:
- Nobody is using your name.
- It meets the spelling requirements (e.g. does not have suffixes).
In some states, the entity name must also reflect the type of business it represents. That is not always the case, however.
By registering your business name, you prevent others from using it in any capacity at the state level.
You should also become incorporated as a next step.
Business Structures for Online Entrepreneurs
The legal and tax requirements for your business are dictated by the business structure you choose. The four structures listed below are the most popular with small and medium-sized businesses:
- Sole proprietorship: You are the sole owner, with limited liability and simple reporting requirements.
- Partnership: If you intend to run a joint venture with a business partner, go for it. Otherwise, the obligations and liabilities are similar to those of a sole proprietorship.
- LLC (Limited Liability Company):
- You have less personal liability for your business, just like an LLC. However, this structure is more difficult to set up and maintain.
- Corporations, on the other hand, have limited liability and are better suited to growing businesses. Legal and tax requirements, on the other hand, are more complicated.
In any case, consult with a qualified professional to determine which business structure is best for your specific situation.
If you intend to sell products online (particularly physical ones), you should be aware of the following regulations and operational requirements:
- Taxes: Sales taxes vary from state to state, and even more so when selling across state lines. Make sure you understand (and follow through on) all of your responsibilities.
- Shipping restrictions: Some shipping companies have restrictions and will not accept certain products (e.g. perishables or aerosols). Alternatively, they may request additional documentation before accepting them. This is also true for international shipments, where customs and import duties forms must be filled out.
- Licenses and permits: In order to provide certain products (and services), you may be required to obtain a license or permit. Check with a local authority once more.
6. Make a Pre-Launch Marketing Plan
You have completed the website setup and business registration processes. Now comes the exciting part: starting your own online business!
You have two main tasks at this point:
- Check that everything is in order.
- Make plans for increasing traffic to your website.
Let\'s go over each of these steps one by one.
Checklist for Online Business Pre-Launch
When preparing to launch, it is easy to overlook an important step. To stay on top of the essentials, use this checklist:
- Review all landing pages
- Proofread your content and put all interactive elements on your website to the test.
- Join an email marketing service provider.
- Create email subscriptions and lead-generation forms.
- Connect your website to Google Analytics.
- Register for and create social media accounts
- Prioritize strategies for attracting customers or selling products.
- Set aside money for advertising.
- Make a list of influencers with whom you intend to network. Create an editorial calendar (if you plan to launch with a blog)
Check out our ultimate web checklist for a more in-depth look at what needs to be done before and after your site launches.
Strategies for Increasing Traffic to a New Online Business
There are various techniques for increasing website traffic. However, as a small business owner, you most likely have limited resources (and marketing budgets).
So let\'s concentrate on the low-cost but highly effective methods of driving traffic to a new website.
1. Join LinkedIn and become an active member
For service providers, LinkedIn is the place to be. To begin, you can notify your personal network of your business\'s launch and update your profile with a link to your new website.
Second, you can use LinkedIn Pulse to publish a series of posts that link to content on your website. Or, even better, a lead magnet linked to an email subscription form, so you can convert some of the readers into subscribers. Then follow up with an email.
2. Obtain Podcast Appearances
In 2022, 62% of the population 12+ has listened to a podcast and roughly 79% are familiar with the medium. That\'s a lot of ears that could be open to your pitch.
You can promote your online business on a podcast in two ways:
- Appear as a guest.
- Pay to be a sponsor.
As a service provider, you may prefer the first option. Use a podcast to share your expertise, promote your name (and brand), and network with other business owners.
Instead, product companies may want to sponsor a podcast because few hosts will be pleased to have someone blatantly promoting their product throughout the show. If you choose a podcast that is relevant to your business, the advertising ROI can be very high. According to a recent study, podcast advertising campaigns increase conversions by 34% on average. In comparison, digital display ads only generate 1.1 percent lift.
3. Participate in online communities to network
Every type of business owner has a specific area of the internet where they focus their efforts. If you find that spot and become a \”regular,\” you won\'t be out of work for long.
Look for online niche communities and membership websites where you can contribute to conversations, offer advice, and showcase your skills on a regular basis. You can make a name for yourself and secure referrals by showing up on a regular basis and contributing.
But keep in mind that 80 percent of your conversation should be knowledge sharing, with the remaining 20 percent (or less) reserved for promotions.
Raizool is an online community with regular AMA sessions, discussion threads, and case study posts, contributed by others.
7. Launch and Expansion
Your launch went well, and your digital books are selling well. That\'s fantastic! Continue your good work and look into other marketing strategies.
The best part about running an online business is that there are virtually limitless opportunities for expansion.
Expand and diversify once you\'ve exhausted one marketing channel (or your core business model).
Here\'s how to take your online business to the next level.
Analyze New Website Monetization Options
The advantage of having a professional website is that you can earn money from it in a variety of ways.
Aside from promoting your core services (or products), you can also divert into:
- Affiliate marketing: Promote other people\'s products and earn money when someone buys through your link.
- Influencer sponsorships are available if you are actively blogging, have a large email list, or have a growing presence on YouTube or Instagram.
- Paid memberships: Create a closed online group for people in your niche and charge a monthly subscription fee to gain access.
Make Your Services More Profitable
By packaging some of your \'knowledge\' into a digital product, you can create a more passive income stream to supplement your main services.
Do you consider yourself an Asana superhero? Have you received a lot of praise for creating content briefs? Or perhaps you have a unique system for creating high-converting emails. Make use of some of your accumulated knowledge to create a simple product that requires little regular maintenance but has long-term value.
For example, freelance writer Kaleigh Moore revealed that she earned over $10,000 in relatively passive income last year from her set of digital products — a collection of marketing templates.
Finally, How to Start an Online Business: 7 Steps Guide
It\'s all done! You now have step-by-step instructions for launching and scaling an online business.
Remember that getting started is the most difficult part. So don\'t get too caught up in brainstorming the \”ultimate\” online business idea or obsessing over the smallest details on your online business website.
Instead, concentrate on creating a good-enough launch version and releasing it to the public. You\'ll have plenty of time (and resources) later on to iron out the minor details.