What you need to start a profitable webshop
So you are about to start a webshop? Dreaming to quit your daytime job and tell your boss to find somebody else to fix the problems he caused! Well be careful…..your boss is maybe not the easiest to deal with, but at least he pays you your monthly salary and it will be a difficult task to make the same amount of money with your shop.
I believe there are a couple of must-haves to start a successful online business. If you don’t have them all, don’t worry: one can compensate the other easily. If you have none of them: be nice to your boss, be patient and make sure you only start your webshop when you are ready for it!
Money:
I regularly talk to people who want to start their own business with zero budget. I don’t think this is possible. Besides financing your inventory, you will need to invest in a professional design for your webshop and please reserve at least 30% of your budget for marketing activities. Also consider that your initial marketing spendings may not result in any sales. You may learn from them however, allowing you to increase your ROI for future campaigns.
Time:
Once your webshop is live, you will need to generate traffic: qualified visitors who are interested to buy your products. Suppose you have an initial conversion rate of 1% at start (which is quite likely) you will need 100 visitors on a daily basis to generate one sale.
You will need a lot of time to: promote your website on forum’s, set-up marketing campaigns, submit your site to directories….then measure the impact……define new actions, implement and….start all over again. Make sure to always measure what you are doing. Use Google analytics to closely measure impact of changes and new marketing campaigns.
Product knowledge:
If you are going to sell a product you have no experience with, think again. You will have a lot of catching up to do with the competition. Although the online world is quite different than the ‘real’ world, some basics are the same…..
You will loose time and money, finding the right target group, finding the right price-points and purchase your products at interesting prices.
Existing network:
Looking for free-publicity of your new webshop the business network you have build-up over the last years will be of great value: free advertising, editorials, your first sales: they will all come from your friends and business network. If you do not have a network, start building it today. Not tomorrow.
Focus:
When I started my online activities I have tried it: launch 4 projects at the same time and thinking about the 5th one even before making money on the first project. You will be confused and guess what…..so will your customers. Confused customers will not buy anything from you. When you start: focus. Then see what works well, then focus on that. Focus will allow you to speak a clear message and be the true expert in the area you want to be successful in. Potential customers will recognize that and consider you a trustworthy partner. They will buy your products.
Luck:
If you don’t have any money, no time, no product knowledge, an inexistent business network and no focus, the only think you will need is luck. I don’t really think ‘luck’ is something you can get, it is something you earn.
I don’t think you will need all the above to start a succesfull online business, but anytime you miss one of the attributes you will have to think how to compensate for it, thus maximizing the chance of success!
If you need advise on starting your webshop, feel free to contact me. I’ll try to challenge your project: not with the objective to de-motivate you, but with the goal to allow you to start a profitable online business.
If you need any help on this post, or are looking for an experienced Magento partner, feel free to contact us!
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