What successful online businesses have in common.
A profitable online business can literally change your life. But like every great achievement, making it happen depends on certain factors. Thankfully, a lot of them are within your control.
But before we talk about what these critical success factors are; let’s look at some of the incredible benefits of having an online business, especially today.
For starters, the internet gives you access to a global market; which means, you can work from anywhere and exchange value with anyone in any part of the world.
In addition, the operating cost of an online business is relatively low. Unlike a brick and mortar store, you can run your internet based business without the need to pay rent and associated maintenance expenses. There’s also the potential to automate your business and generate income passively, even while you sleep.
Moreover, the barrier of entry for many online businesses is low, as the gatekeepers have been shut out. So, it’s safe to say that the internet has democratized entrepreneurship.
The internet is now at the center of our everyday life, and our online needs are evolving by the day. This has resulted in more demand for online solutions.
For instance, virtual events have come to stay, more people are working remotely and online shopping is reaching new highs. According to McKinsey & Companyonline sales in US retail jumped 40% year over year in 2021.
This increase in online activities presents a great financial opportunity for entrepreneurs; and with the scalability potential of an online business, the amount of money you can make, is limited only by how far you’re willing to go.
But hangs on; if an online business is this rewarding, why isn’t everyone doing it? How come some are struggling? Why are some of these businesses running at a loss?
If your online business is in this category; there are a set of critical success factors you’ve probably not considered. So, whether you’re selling a physical product, a digital product or a freelance service; there are four things you have to take seriously, if you want to create a profitable and sustainable online business.
Customers are the oxygen of any business. If there are no customers, the business dies.
It doesn’t matter how awesome your product is, if there are not enough people willing to pay for it, achieving your business objectives will be very difficult.
But I want you to pay attention to two words — enough and pay.
First, you want a sector with a large enough market size, and you want to be realistic about whether or not you can get enough market share to meet your revenue goals.
Secondly, it’s one thing for people to show interest in your product, it’s another thing for them to back it up with their money.
So, before you invest your hard earned money or that of other people in any business, you should first of all establish demand. You should make sure that there are enough people willing to pay the price you’ve set for your product.
At the heart of every successful business is a compelling offer. As a result, you should aim to deliver great value to your customers consistently. Your offering includes your product quality, its price, payment terms, customer experience and every other component of your value proposition.
For instance, a product at market rate, but with free useful ad-ons, zero upfront cost and price payable over 12 instalments, is highly likely to sell faster than just the product, offered at the same price — payable in full at the point of purchases.
As you can see, this is not just about the price, but the total package and how it’s perceived by your target audience, especially compared to the competition
Talking about competition, when you sell online, your competition is always a scroll or a click away; which makes an irresistible offer even more crucial.
Your goal is to make it easy for your target audience to buy your product. As it’s often said, “make them an offer they cannot refuse.”
Having a great product is not enough to generate sustainable sales. You need to find a way to put your product in front of your target audience.
There are over one billion websites on the internet and the Amazon marketplace alone, has over 6 million sellers; never mind the over 4.7 billion social media users around the world.
As you can imagine, there’s a lot happening on the internet, and your product listing is just a drop out of the ocean of internet pages.
To increase your online visibility, you need a robust digital marketing plan, including a practical SEO strategy, where appearing on the first page of search results is a top priority.
Once again, if you want your online business to succeed, you need to find a way to get your great product in front of your target customers.
remember, if they can’t find you, they can’t buy from you.
People buy from those they know, like and trusts. It doesn’t matter how compelling your offer is; no one will buy from you, if they feel they can’t trust you.
This is particularly challenging, when you’re just starting out online. Your prospective customers have never bought from you before, they can’t touch your product and they’re not even sure if they can leave their payment details on your website.
Thankfully, there are a few things you can do to boost the online credibility of your brand.
i. Start on other people’s platforms.
People are more likely to be comfortable buying from you on Amazon, Fiverr or Upwork than from your website. This is because they already trust these platforms. But you can build customer loyalty on these platforms overtime, and leverage it later on your website.
ii. Build a website that looks credible
The design and content of your website should be professional, with a security certificate showing that it’s safe. Moreover, ensure that the content on every page is free of grammatical errors.
iii. Give free value first
What better way to convince your target customers of the quality of your product than letting them have a taste of it? In addition, when people get something from you, they’re likely to return the gesture. This is called the law of reciprocity.
Giving free value first helps you build credibility and makes people likely to buy your paid products.
iv. Ask for reviews
Online reviews can make or break your business. A great review displayed with your product listing or shared on a social media page with a large following, will do your online credibility a lot of good.
Of course, it goes without saying that to get a good review, you need to deliver first.