It is important to note that there is no one-size-fits-all model for starting a new business, but these steps will help you organize your thoughts, and iron out key details so when you launch your business you have all the answers you need.
Step 1. Ask Yourself if You’re Ready
There will never be a right time to start a business. If the stars couldn’t align for Romeo and Juliet, they probably won’t align for you either. But you can either look at that as a barrier to starting or use it as motivation.
When it comes down to deciding whether you are ready to start your own business, mindset is more important than timing. Are you in the frame of mind right now to win? If you didn’t shout heck yeah at your computer screen, you might need to re-examine if entrepreneurship is the right path for you.
The reality is saying you’re going to start a business is easy. But doing it, turning nothing into something that makes money, can be a whole lot tougher.
And you need to be mentally prepared to take something on. Why? Well, there are going to be challenged like creating ads that generate sales. And if your mindset isn’t in the right place, any failure could devastate you. But if you’re in the right mindset, you’ll KAPOW! failures until you finally start hitting your big wins.
Step 2. Determine What Type of Business to Start
The next step of starting a business is to figure out what type of business to start.
Is there a niche that you’re particularly passionate about? Are you looking for a sample business plan that you actively work on or just own? Are you looking to turn your hobby into a business? These are just a few of the questions you need to ask yourself before starting a business.
You can start everything from a Shopify store like MVMT Watches did to a freelance business. You can choose to build a business by yourself by owning a consulting business or you can build a company with a team such as a manufacturing company or a restaurant.
Next, use a tool like Keywords Everywhere to look up the search volume of your list in Google. This will help you understand how popular your list of ideas is. You can also use Google Trends to analyze whether the trend is trending upward or downward or if it’s stable to determine the niche’s long-term viability.
Then, look at the top three most popular keywords on your list and answer this question, “In five years from now, which niche would not only get me out of bed in the morning but would also excite me enough to continue creating content/products/tools for it?”
So, what’s your big business idea? Feel free to share in the comments.
Step 3. Choose a Business Model
After coming up with a business idea, think about how you’re going to execute it in your niche. This is where a business model comes into play.
The business model is a strategy for how you’re going to provide value with your idea and make money off of your customer base.
When learning how to start a business, helps to know about some tried-and-tested business models.
Here are six types of business models to consider:
Affiliate Marketing: Promote other businesses products and services online, and receive a commission for each sale you make with this passive income idea.
Freelancing: Provide a service to other individuals and businesses using a skill that you have, such as advertising, writing, designing, or programming.
Coaching and Consulting: Become a coach or a consultant and sell your expertise, advice, and guidance.
Information Products: Package and sell your expertise in ebooks, worksheets, templates, and online courses.
Software as a Service (SaaS): Create a piece of software or application, and charge users a recurring subscription fee.
Ecommerce: Use a service like Shopify to set up a website and sell physical products online.
Step 4. Do Market Research
Next, you need to get clear on your target market. In other words, who are you going to serve?
This step is absolutely vital.
As the marketer Philip Kotler once said, “There is only one winning strategy. It is to carefully define the target market and direct a superior offering to that target market.”
Here’s the trick: Make sure you are part of your target audience.
Think about it. If you’ve been camping your entire life, you’ll understand the problems, desires, and language of other campers. As a result, it’d be much easier to sell camping products online.
Plus, your marketing will be more successful because you’ll have a better understanding of how to communicate with other campers.
On the other hand, if you’ve never been camping in your life, you’d probably struggle – a lot – to sell camping products online.
So, when choosing a target audience, ask yourself:
What are my hobbies and interests?
Is there anything that I know a lot about?
What do I spend most of my time thinking, talking, and reading about?
As the business consultant Peter F. Drucker said, “The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.”
Step 5. Find a Problem to Solve
When learning how to start an online business, it’s important to note one key thing: all businesses solve a problem.
Plumbers fix leaking pipes. Hollywood movies fulfil people’s boredom, curiosity, interest, and the need to escape and relax. Clothing brands help people express themselves and feel attractive.
Here’s the golden rule: The bigger the problem you can solve – and the better you solve it – the more money people are willing to pay.
For example, take healthcare services. They solve a big problem, which is why almost everyone is willing to spend a lot of money on it.
On the other hand, not many people will pay you to stop their table from wobbling. It’s not a big problem, and they don’t need help solving it.
Bottom line: If you want to identify how to start an online business, you need to find a good problem to solve.