Recently I received an email from a college student asking for advice on starting an online business. She said, “one of my greatest dreams is to open up a business similar to yours, where I can provide people with the same information that has changed my life. The reason I am emailing you is because I was wondering if you could provide me with a few tips.”
Here are my top 5 keys to starting an online business:
- Pick a narrow, targeted focus that you are passionate about. You don’t have the money to start out as a Wal-Mart or an Amazon, that carries everything from avocados to zoom lenses. Even in the area of self improvement, you would be wise to pick one specific topic, whether it is time management or communication skills or meditation or sales. To use another example, if you are interested in art, you need to narrow it down further. Perhaps impressionistic painting, or ceramics, or nature photography. The more narrow your focus, the more successful your website will be. Pick a subject that you are interested in, one where you have the most expertise and knowledge, one that you are passionate about. Stay focused on this one area—and make it successful. Then, once you have built a thriving business in your target area, you can begin to expand and grow into other areas if you like. Most successful businesses stay with their core focus and expand within that area, rather than watering down their effectiveness by going in too many directions at once.
- Never borrow money to start an online business. Start small. Use word of mouth at first. Promote your business with friends, relatives and acquaintances. Avoid expensive advertising or website designers. I recommend that you learn to design your own website. This way you are not at the mercy of web designers that charge $50-$200/hour. When Benjamin Franklin said, “a penny saved is a penny earned,” he was only half right. A penny saved is actually better than a penny earned, because you don’t have to pay taxes on it. Be smart, go slow, never borrow, expand only as you grow.
- Serve your customers. Most people know that to survive today, a business must listen to their customers and give exceptional customer service. Strangely, many of those same people think that an online business is somehow different; that you can just put your feet up and money will come rolling in with little effort or action on your part. This idea is the foundation of most failed online businesses. The truth is that an online business is no different than any other business. You have to come to work every day, hire employees, warehouse inventory, answer the phone, be on time, and bend over backwards to satisfy your customers and build their trust. I believe that, in many ways, an online company is even more demanding than a brick-and-mortar business because you have to be personally disciplined and provide outstanding service if you are to establish a place in the global economy that is the internet.
- Establish business hours and be there. All successful businesses have fixed business hours when you can reach them for assistance or make a purchase. We are all familiar with those annoying automated phone trees. “Press one to hear another menu, which leads to another menu, which ends in a voice mail of someone who is not available to take your call.” This may work for large established companies (and not very well, I might add) but you cannot afford to miss these calls. You have to be there to answer the phone, respond to emails immediately, and make the customer feel that they are the most important thing in your day.
- Take advantage of affiliate programs. An affiliate program is an opportunity for you to start big with a large, established selection of products, without having to invest huge amounts of money to inventory and warehousing products or having to negotiate reselling contract with individual author or manufacturers. Many established companies have a affiliate programs where you link to their catalog or online store using an affiliate link. Whether you want to sell toys or books or clothing or gardening supplies, there is usually a great affiliate program available. You can use an affiliate program to supplement your own products, or as your entire web store. With an affiliate account, you use unique tracking codes to link from your website to the page on another website where a particular product or author is located. The system tracks all visitors that originate from your website and pays you a commission on sales from those people. Good affiliate programs continue to track sales from customers that you have referred, even when they come back and purchase months or even years later. Our MindPerk affiliate program, for example, tracks your customers for up to 50 years, so you can continue to earn residual commissions for many years. Affiliate programs eliminate much of the work of having a website. They take care of stocking and shipping products, collecting payment, and customer service issues. However, you must still have great content on your website to attract visitors in the first place. Start by writing articles and tutorials about the topics that you have expertise in. Then, place affiliate links to appropriate products next to your content. Spread the word through family and friends. The more great content you have, the more people will visit your site and then purchase products through your affiliate links.
Starting an online business is hard work, but it can be very satisfying and worthwhile. You are not limited by geography—you can share your message with like-minded people all over the world. The most important thing is to make your plan, then get started. Best wishes on your exciting new online adventure.