How to Make Money Online: The Basics
Get the working capital your business needs from Entrepreneur Lending, powered by CAN Capital. Learn More »
Let’s say you’re a newbie to the world of online sales and are looking to make money online, but you’re starting with a small startup budget. With the blinding wealth of information available for new business owners, knowing how to spend your limited funds can be a bit intimidating.
Here is a five-step checklist to help get you started and guide you toward success.
1. Spend time getting feedback on what you’re selling before launching.
Don’t rely on affirmation from friends and family to validate that you have a unique and salable product or service. Chances are, these people are emotionally attached to you, and they’re more likely to think every idea you share is the greatest thing since Nutella. Getting feedback from people who are emotionally attached to you is a “disaster from the start,” says Adam Callinan, founder of BottleKeeper.
Get market validation from potential customers who aren’t in your social circle. Some entrepreneurs use the “will they pull out their wallet” test before investing money in a business. Callinan, who’d come up with a prototype for an individual beer bottle cooler, ran a crowdfunding campaign on Fundable to gauge pre-orders for his product. His campaign raised nearly $14,000, 280 percent of his $5,000 goal.
Other ways to get people’s feedback, says Sujan Patel, vice-president of Marketing at When I Work, is using customer insight survey tools, such as Qualaroo and Client Heartbeat. If you’re just starting out, surveys are a chance to find out what the customer is hoping the product/service will solve or do for him or her. If you’re already in business, surveys can ask how the customer found out about the product or service, whether the customer is willing to be a return customer and why.
Or if you’re in a job in the industry you plan on starting a business in, get feedback from the people at your job -- your manager and clients -- says Steve Tobak, founder of Invisor Consulting.
2. Have a website.
You must have a website, says Joel Widmer, founder of Fluxe Digital Marketing. Not only for the obvious -- to have something to refer customers back to -- but having a website builds your brand’s digital footprint. Keep your site simple and copy-driven with opportunities for email captures on every page.
Three easy steps to having your own website to sell products without spending a lot of cash are:
- Select a content management system (CMS), such as WordPress, which is popular for its user friendliness and is free.
- Register a domain name and subscribe to a hosting service, such as GoDaddy or Bluehost.
- Customize your CMS with ecommerce-enabling plugins and themes. WooCommerce offers free ecommerce themes for WordPress, such as Storefront. Also, WP eCommerce and MarketPress are additional free ecommerce plugin options.
Related: How to Make Money As An Expert
Related Book: Moonlighting on the Internet
3. Know your competition and customers.
Study up on both competitor and complementary brands (i.e. if you are selling a fire alarm, then look for “house safety” websites). Widmer says your customers will be hanging out on websites for both competitor and complementary brands. He recommends using search tools such as SimilarWeb and Google’s related-search results (located at the bottom of every Google search) to see what sites your prospective customer may be visiting.
Other free research tools to get to know your market, suggests Brandon Schaefer, CEO of MyVirtualSalesForce, are LinkedIn (to see who competitor brands are connecting with and what types of updates they're posting), Google Alerts (for brand mentions and keywords) and Google Trends.
4. Create an action plan for sales and marketing.
To earn your first million in sales, says Patel, work backwards and put a number on what it takes in monthly revenue to get to a million your first year -- meaning how many units, subscriptions or services must be sold. Create benchmarks to reach. Even if you don’t reach them, you have a blueprint.
One way to reach your goal is to figure out which marketing avenues to leverage. Given the wealth of social-media possibilities, start with one or two social-media outlets where you know your audience is. In general, for new products the best channels are Facebook and Pinterest, says Widmer. For expertise and services, try LinkedIn.
Also, two effective and free marketing strategies are blogging on your own site and guest blogging on complementary sites. This strategy helps build content and a digital footprint for your brand, says Widmer. For guidance on what hot topics to blog about, Buzzsumo, a free web service, allows you to input any domain or topic and get a list of the 10 most popular related posts at the moment. It can also inform you of what popular sites to hit up for guest blogging.
Should you guest blog, use the opportunity to lead users back to your site and capture emails, says Widmer. One way to do so is to use a “call to action” -- where you offer the reader something of value, such as a free how-to eBook or a must-have checklist -- that the user can get or download by going back to your website and providing an email address.
Some other marketing tools? The free KingSumo app allows you to capture email subscribers through giveaways; Facebook Ads start at $1; and the e-newsletter tool MailChimp has a free option and is drag-and-drop easy.
5. Do as much yourself as you can.
The DIY mentality will usually save you money if your budget is limited. Also, it allows you to control the process and brand, explains Callinan, who built his ecommerce site from scratch by talking to others who’d already done ecommerce sites successfully. Don't farm out jobs you can do yourself, especially in the beginning.
If you need on-demand expertise from entrepreneurs with a track record, try Clarity, says Widmer. The service allows the user to get specific, consultant-level advice for a fee.
All startups are a gamble -- but as Patel advises, whose company will hit $10 million in revenue this year, “Hone in on where your strengths are and double down.”
This piece originally published on July 7, 2015.