OUR ULTIMATE GUIDE TO STARTING AN ONLINE BUSINESS IN 2017
Millions of people will be starting a business 2017, 90% will fail. To help increase your chances of success we spoke to over 50 online entrepreneurs on everything including, ideation, how to put together a team, acquiring your first few customers and top mistakes and put together a guide to help you succeed.
The full eBook can be found here – eBook guide, here are the first few chapters to get you started
So you want to start a business online, this guide will be your step by step manual. You can expect information on everything you need to think about, consider, and do to ensure the highest possibility of success. Online businesses start up and fail at an astonishingly high rate. We interviewed over 100 entrepreneurs over the course of this book, I found most first time entrepreneurs face the same issues, more importantly make the same mistakes. This guide aims to help you from making basic mistakes to put you in the best possible position for success.
This book includes tips from entrepreneurs, as well as myself. I have launched 3 companies, failed twice, lost my savings and made it back times over. My personal passions have always been helping people to grow, hence why this eBook was written. If you have found it useful please share and check out my company startteck.com for more tips and ways to help give your business the best possible start.
SO YOU WANT TO START A BUSINESS
Great, you want to be an entrepreneur; before you change your Linkedin profile and rush to change your Twitter bio to Entrepreneur, what does it mean. Google translates entrepreneur as “a person who sets up a business or businesses, taking on financial risks in the hope of profit.” Breaking down this definition; one thing that a lot of entrepreneurs face is challenges and the main reasons for failures is quitting. So, to stop yourself from quitting, let’s firstly make sure you know what you are getting yourself into.
You are taking on financial risks which potentially can lead to lost time, money and opportunity. Financial risks are not promised rewards; that is why the definition says “in hope of profit”. Meaning, in business nothing is guaranteed, 90 percent of businesses fail with the first 2 years.
To succeed you will need courage, optimism, realism, hard work, persistence, diligence and planning to come together to increase your odds. Ask yourself are you ready for that now? Or are you willing to learn the skills required and stay diligent amongst your journey.
If you are still reading and the first few paragraphs haven’t scared you off, well done, that means the reality of being an entrepreneur doesn’t frighten you, you possess the traits of an optimistic realist. This is a key trait you will need to have.An optimistic realist is someone who is able to look at the positive side of life while maintaining a realistic viewpoint. Personally, I had to realistically look at the possibility that, although I want to be successful in business, it could take me 10 years to achieve the success that I wish for; 10 years of losing friends, reducing faith, close to depression, no money etc until suddenly the stars align and the business explodes. If you can understand the reality of start up businesses and remain optimistic, you are ready to take the leap.
Now we have confirmed that you ready to be in business, it’s time to move on to the next step, idea formulation.
David J Schwartz, in his book, the Magic of Thinking Big, says that “the biggest problem is that most people can’t even think big. Why think small, shoot for the moon, if you miss you’ll be amongst the stars.” First you need to find out what you’re motivated by, what big ideas do you have?
Picture yourself 80 years in the future, standing in a hazy room, filled with mourners, criers, family members and friends. The room you’re in is a church, you’re walking closer to the altar but no one seems to notice you, even you don’t really notice you, it’s like you’re not really there but very present.
As you get to the altar you realise that it’s you at the altar in a coffin, an old version of you lying in the coffin and the pastor at the front is about to give your eulogy. Now, he is going to be every honest and it’s a sobering thought for you, you suddenly realise that you want him to say? Do you want him to say you were a good person whose contributions to the world will live on for generations? You were a good person who drove a Mercedes? Do you want him to say what field you contributed to?
Figure firstly what you want this person to say and get motivated by working backwards.
After you figure that out, imagine yourself being in a society where you want nothing and have time on your hands, in this society you can do whatever you love, whatever your heart is truly passionate about, in this society you had an option of 3 things to do, what would these 3 things be?
If you have answered this, two things, now you can start asking yourself ‘how can I make a business of my passion?’ Passion in my opinion is the most fulfilling way to make a business, as you do not realise where the time goes whilst working on it, you become so immersed in your idea, your business that you can work on it all day long.
Passion is not always key a lot of people have made million pound businesses just by chasing opportunity; it is good to be happy when you are working, so I’d advise you to find out what you are passionate about.
Fishing for ideas
Ideation is skill that comes from different places. Napoleon Hill believed that we all have access to infinite intelligence where all innovation comes from. These ideas can be referred to as ‘light bulb’ moments or sudden inspiration for action. The first thing you should do with each idea that comes to mind, is to write it down, Hill believed these ideas are gifts that require more thought.
Chinasa George from Organise LTD agrees with Hill. He said “the inspiration for his idea came to him in a kids care home he used to work in and that it’s always good to aim to solve a problem you are familiar with.”
Research conducted at the University of Haifa suggests that “Developing an original and creative idea requires the simultaneous activation of two completely different networks in the brain: the associative — “spontaneous” — network alongside the more normative — “conservative” — network”.
The summary of the study tells us that ideas come ‘collaboratively’, that means from networks in the brain, meaning that people who tend to associate with different groups, read different information tend to see connections between them and formulate ideas. For the idea “to be original an additional region in the brain works in collaboration with the associative region — the administrative control region.
A more “conservative” region related to social norms and rules. The researchers also found that the stronger the connection, i.e. the better these regions work together in parallel — the greater the level of originality of the answer.” Your social norms, connectivity and collaboration on different views come together to formulate ideas.
So one way to get ideas is to start doing things you love, spend time with people from all works of life and ages, look for gaps in the world that need filling, ask yourself the right questions. Although it is imperative to gain information from others, spending time alone and meditation is important as most ideas are thought of at random or even in dreams.
Write down all the ideas you can then ask yourself what are the ones you are most passionate about? What are the most feasible? What are the ones that motivate you?
By process of elimination, get your ideas down to a small list and conduct your research. As Chinasa says “you never know if your idea is the right one and that’s the nature of entrepreneurship. Nonetheless you must have that conviction or some may say faith that your hard work must be rewarded.” The idea you have most faith in and possesses high potential reward is your next step.
RESEARCHING YOUR IDEAS
Research is an important session that can save you time and pain in the future. You want to be able to understand the potential of your new online venture. There are a few places to start, let’s say for example you want to sell easy to wear shoes for disabled people in wheel chairs.
You can start by finding out how many disabled people there are in your local market or international market by looking through statista.com. This will give you a wealth of statistics regarding disabled people.
You can use this for all relevant statistics. Other information you will want to find is the potential expenditure on clothing, footwear or potential income of your target market. With these figures you can start building an ideal customer profile/ persona of your potential buyer. This will allow you to explore your idea of footwear from style, colour, price etc and whether it would be of benefit.
Whatever business you want to go in, whether it is a product or a service, you have a person whom you are targeting and you call this person your prospective buyer or prospective customer. As soon as this person adopts your proposition, he/she drops the ‘prospective’ description and graduates to the title of buyer or customer.
This is important to understand, as once you understand your potential buyer, you can see whether it is a feasible market for them. You can begin to ask yourself questions such as, how to market to them? What language? Images? Tones? locations? Etc.
The Buyer’s Silhouette
Buyer persona is the characterisation of your prospective buyer into a high-resolution, high-definition silhouette. This ensures your marketing and sales efforts are not wasted on prospective customers who have no need for your product or service.
The process of creating or defining your buyer persona is similar to focusing your camera until you get a clear image to capture the focus/image. Focusing is particularly important in helping you craft your marketing messages, since the design of your product or service is based on the perceived needs of a particular target market.
Consequently, you want to make sure that only the ones who are qualified according to your established buyer persona shall enter your prospective customers’ screen, this is to ensure the correct market is addressed by your message. A buyer persona therefore helps not only to reduce operating and capital expenditures; it tremendously enhances the effectiveness of your marketing and distribution efforts, which can later be measured using a conversion rate.
Buyer Persona Configuration
What exactly goes into researching the buyer persona?
You will need the following data:
Demographics are statistical descriptions of populations especially used in identifying markets. Demographic data is an ideal starting point for creating buyer persona, to be able to identify and separate the target markets. Just as you would sieve the chaff from the grain and retain the grain. In your marketing funnel, you do not wish the whole population to enter the mouth of the funnel; your demographics provide the sieve.
Once you have all this information you should be able to draw a crystal clear image of your customer and why they need your product. You can even go as far as to name this persona.
Once you have defined your buyer persona now it’s time to understand the industry.
When defining a market you can use the top down or the bottom up method. The one you find more appropriate is up to you, however it is a must to understand your potential market size and potential revenue. From your analysis you can find out if your market is too small. If this is the case, you can’t make money, no matter how innovative the product or how competitive your pricing.
A top down analysis is calculated by determining the total market size, then estimating your share of that market. A typical top down analysis might go something like this: “Hmm… I will sell a widget everyone can use, and since there are 300,000 people in my area, even if I only manage to land 5 percent of that market I’ll make 15,000 sales.”
To work out the total market size you can use free tools that Google offer. Doing a search or by using more in depth analysis such as the Key Note Market Report.
For this you will need to pay, however the knowledge in these documents can save you a lot of money in the future.
An example page can be seen below:
Here you can see growth and decline of the industry and companies who own a majority of the market share.
A bottom up analysis is calculated by estimating potential sales in order to determine a total sales figure. A bottom up analysis evaluates where products can be sold, the sales of comparable products, and the slice of current sales you can carve out. While it takes a lot more effort, the result is usually much more accurate. This is the approach we recommend.
Here you may say that, we are initially selling our app directly to businesses in the UK with less than 1000 employees who tend to work long hours. 6000 firms match, if we sell to 100 of them, we can be really successful in our niche with potential revenues of up to £18m. After we become successful in our niche, the possibility to expand into larger companies and new markets become easier. This is an example of bottom up approach but you must back it up by data.
Get the full ebook here – business.startteck.com/ebook