If you have an idea for a business, establishing one online could be a way to enter the digital market and earn extra cash from the comfort of your home. Here’s how to start an online business, plus five business ideas to get your wheels turning.
Before putting your business shingle out online, doing some preliminary planning can set you up for success. Here are eight steps to help you get started:
Whether you plan to sell physical or digital goods, or you can offer a service, like consulting, the best online business strikes a balance between what you’ll enjoy selling and what people are interested in buying. Start by researching different niches and industries to find gaps in the market you could fill with your business.
When you have a few product or service ideas in mind, start analyzing what competitors have to offer. Check competitor pricing and read customer reviews to identify areas where your product or service could stand out. But don’t feel pressured to come up with a completely new concept.
“While innovation is always good, having a very unique product can actually hurt more than help,” said Andrei Vasilescu, co-founder and CEO of Don’tPayFull, a coupon website that helps consumers find deals. If there’s no demand for a product, you could end up spending most of your time explaining what it is and convincing people to buy it. On the other hand, launching a new take on an existing product could be easier to sell and more profitable.
A business plan is a document that outlines what you’re selling, who you serve, how you operate, and your unique selling proposition. Think of your business plan as a living document that you can update as your business grows and goals change.
Defining your audience can help you create branding that cuts through the noisy internet and attracts the right customer.
“When you try to appeal to everyone, you end up appealing to no one,” said Meyr Aviv, founder and CEO of iMoving, a tech platform that helps people plan their move. If you focus on a specific group of people instead, you can better meet their needs and wants, and you're more likely to convert them into customers, said Aviv.
The administrative and legal steps you should take to get your business started will depend on the type of business you want to set up. If you’re freelancing or consulting, you could operate your business as a sole proprietorship.
However, setting up a separate business entity, such as a Limited Liability Company (LLC) or S Corporation (S Corp), could limit your personal liability if your business is sued. If you’re not sure of the best route to take, an accountant can guide you on how to set up your operation legally.
Many different website builder options exist that you could use to create an online home base. Drag-and-drop website builders like Squarespace, Shopify, and Wix make it easy to set up business pages or shops without coding. However, if you want to get up and running quickly, you could also sell digital and physical products on marketplaces like Creative Market or Etsy.
Your brand is reflected in your marketing material, including your logo, business tagline, color schemes, and the tone of voice you use on social media and your website.
If you don’t have a large budget to hire a designer for branding, you could create your own logo and brand assets using affordable design tools like Canva, Looka, or LOGO.com.
You’ll also need to come up with a plan for how you’ll get the word out about your business. You may need to fight the urge to start promoting on every social media platform.“When it comes to marketing, if you have limited budget or resources, start with just one to two [marketing] channels,” said Meg Prejzner, owner of Hackett Brand Consulting. This way, you can perfect your marketing strategy on a few platforms first and then expand as your business scales.
Outside of social media, think about how you’ll grow your email list and how you’ll build a relationship with people on that email list through regular broadcasts, promotions, and product launches.
When you’ve done the groundwork to set up your business, it’s time to promote. Creating a monthly content calendar for social media posts and emails can help you stay organized.
You can also consider experimenting with paid advertising through social media ads, search engine ads, or influencer marketing. If you’re not sure how to write social media ad copy or build an ad campaign, Coursera and Udemy have affordable courses that can help you learn more.
Not sure where to start? Here are six ideas to consider:
Freelancing as a writer, designer, consultant, graphic designer, or artist and working on projects for clients is a way to earn an income that could eventually replace your full-time job.
However, how much you might earn depends on the type of service you offer and the rates you set for your work.
If you’re a subject matter expert in an area, you could create and sell online courses that teach the topic. Udemy is a platform you can use to market and distribute your classes, or another option is selling courses directly from your own website.
Web design is a service that many professionals and small businesses need. If you have some basic skills, a business that offers design, consulting, and website maintenance services could be lucrative.
Dropshipping is a unique business model where you create a storefront but don’t store your own products. Instead, products are kept in a warehouse, and you pay a third party to handle the logistics of sending out goods. A dropshipping business requires less upfront capital. However, the trade-off is that profit margins may be lower because of third-party costs.
Affiliate marketing is a business model where you refer people to products and services and earn a commission when they make a purchase. If you build a popular blog or grow a large social media following, affiliate marketing is a way to monetize your audience.
The beauty of starting a business today is that you can get started without a lot of money, but it’s not a get-rich-quick scheme. Building a brand and finding customers often takes time, so don’t be deterred if your business isn’t an overnight viral sensation. Experiment to see what works, learn as you go, and enjoy the process along the way.
This material has been presented for informational and educational purposes only. The views expressed in the articles above are generalized and may not be appropriate for all investors. The information contained in this article should not be construed as, and may not be used in connection with, an offer to sell, or a solicitation of an offer to buy or hold, an interest in any security or investment product. There is no guarantee that past performance will recur or result in a positive outcome. Carefully consider your financial situation, including investment objective, time horizon, risk tolerance, and fees prior to making any investment decisions. No level of diversification or asset allocation can ensure profits or guarantee against losses. Article contributors are not affiliated with Acorns Advisers, LLC. and do not provide investment advice to Acorns’ clients. Acorns is not engaged in rendering tax, legal or accounting advice. Please consult a qualified professional for this type of service.