There’s never been a time when the desire to learn how to create an online business has been stronger. While many of us have made the switch to working from home on a regular basis, others simply want to put our skills to the test and create something from the ground up.
Whatever your motivation is, an online business doesn’t have to be something you only dream about. It’s something you can do right now.
An online business is within reach, but it requires planning and preparation. Getting your online business started will take a mix of both strategy and execution. There are specific actions you need to take and critical decisions you’ll need to make.
Take a closer look with us as we deep dive into how to create an online business and turn your ideas into a reality.
How to Create an Online Business
The steps below outline the process for starting an online business. One thing to note is that you may not necessarily have to complete these in this exact order. Some steps may even happen simultaneously.
You’ll also notice the work falls into two different buckets, including strategy and administrative tasks. Some steps require thought, while others require actually doing the work.
1. Research Your Online Business Idea
If you’ve thought about an online business in any way, shape, or form, then you’ve likely seen how many different types of online businesses are available.
During this phase, take a look at the most popular online options and see if there’s one better-suited for your income goals, lifestyle, personality, and obligations.
Popular online business options include:
- E-commerce: An e-commerce store is simply the selling of physical goods online. To do this, you will need to set up an online shop.
- Social media-based: We’ve all seen ads on Facebook and Instagram or have been sold a particular product from an influencer. These are examples of social media-based businesses.
- Affiliate marketing: An affiliate marketer is someone who sells products on behalf of someone else or another company. You receive a commission for promoting the product on your website, social media accounts, or via email.
- Freelancing or consulting: Freelancing or consulting are great ways to get paid for a skill. You can promote this business entirely online through social media channels, purchasing ads, building a website, and asking for referrals.
- Digital products: Digital products include a wide range of items that can be downloaded when purchased. Examples of digital downloads include music, videos, photographs, ebooks, printables, templates, and educational courses.
2. Understand the Marketplace
Once you begin the research process, you’ll start finding a few ideas that stand out to you. This is when you need to analyze the marketplace to determine which opportunity makes the most sense.
For example, if the idea of setting up an e-commerce store is appealing to you, this next step forces you to go deeper by looking at the potential for your online business idea.
One of the best ways to determine if your product or service is needed is to find out where customers are being underserved.
For instance, consider if you have personally seen a lack of customer service in industries you typically work with. Or, think about if you’ve looked for a particular product only to be disappointed to find there are few places online in the U.S. selling it.
Beyond your personal experience, you can also set up surveys to find out where customers are being served or neglected. Plus, you can research the competition to find out where there are strengths or weaknesses and how you can capitalize on these.
3. Create a Business Plan
Your business idea may be online-only, but the need for a business plan is as critical for you as it is for a brick-and-mortar company.
There are plenty of online templates and guides to walk you through creating a business plan. Think of it as a place to dive into the market further, work through potential roadblocks, and analyze the competition.
Even if your online business doesn’t have investors or other partners involved, it’s a smart way to strategize how your business will grow and set itself apart from others.
4. Set Up the Business the Legal Way
Now for the fun part.
Admittedly, no one wants to think about paying taxes and filing paperwork. However, this isn’t optional. In fact, it’s something you should do as soon as your plans are solidified and you want to move forward.
There are a few main steps you should take care of when launching your online business. These include:
- Business formation: Decide if you need to set up your business as an LLC or a corporation. Some states require you to register your business as well.
- Apply for a Tax Identification Number (TIN): Think of this as the Social Security number for your business. This will be needed to pay taxes on the money you earn from your online business and can be completed online.
- Open a business checking account: Establishing a business account is the best way to manage the money you earn from your business. Keeping your business account separate from your personal one will make it easier on your finances in the long run.
- Hire a professional: If you’re confused about any legal and tax requirements, you should talk to an accountant or CPA about what your state requires. They can provide advice on proper business filing and how to pay taxes each quarter.
5. Develop the Brand and Website
At some point while you’re learning how to create an online business, you need to develop a company brand strategy. You may think this is only meant for big companies, but all businesses can benefit from consistent branding.
Branding could be as simple as choosing consistent colors with your communications. It could include the “look” of your social media posts and emails. It could even ensure your company goal is represented through all levels of communication.
Once you have an idea of your company brand, you will likely need a website. This will help you further develop your brand.
Not only is the website how you’ll likely execute your online business, but it can benefit your brand by adding tools such as a blog, photography, products, or resources.
While a website is an essential part of most online businesses, it’s also a place where business owners get stuck. Whether you hire someone to do this for you or create a site yourself, make sure you don’t let this step keep you from moving forward with your business dream.
6. Create a Marketing Strategy
Part of establishing your brand will involve creating a marketing strategy. How do you plan on getting the word out about your goods or services? Word of mouth? Social media?
There are so many options available to online business owners, and finding which ones are best for your business can be overwhelming.
Fortunately, in this digital age, there are tons of methods for marketing your online business. For example, here at Laptop Empires, we rely heavily on Facebook ads for marketing. These ads were instrumental in getting this blog up and running.
There are numerous ways to market an online business. Some ideas might include:
- Purchasing social media ads
- Establishing brand partnerships
- Content marketing, such as creating blog posts, ebooks, Q&A materials
- Email marketing campaigns
This is only the tip of the iceberg, but creating a strategy can help you successfully launch your business.
Remember that you can always adjust your strategy as your business grows and changes.
7. Solidify the Logistics
There are many logistical aspects to running an online business. Getting as much in place before you launch will lessen the number of headaches down the road.
An online business can have the same type of logistics that a brick-and-mortar business may have, such as manufacturing, suppliers, shipping, and packaging. If you have physical products, you need to explore all the aspects of each of these before launch.
There are other logistics to think of as well, including how you will accept payment and what platform you’ll use for your website or e-commerce store.
The Final Word on How to Create an Online Business
If you’ve ever wondered how to create an online business, now is definitely the time to build on this curiosity. There are a tremendous number of resources available to get started and established. Plus, the demand seems to be as strong as ever.
With these seven steps, you can grow your online business idea into a full-fledged company and not just something you only dream about doing one day.