There are a lot of people talking about niche and targeting your ideal customer lately, but here’s the thing…
…if you're stuck on what type of online business to start, then all of that stuff doesn’t actually matter yet!
You can’t target the right customer until you actually know WHO your customer is.
And you won’t know exactly who your customer is with any kind of clarity until you know exactly what type of online business you want to start.
In this article, I’m talking about the different types of online business and what you can do to actually get started, today!
After more than 14 years of accumulating and analyzing data about growing and scaling different types of online businesses, I can tell you first hand that TRANSFORMATION is what moves you from zero to six-figure salary, not someone else's “framework.”
Listen up, because this is important.
Transformation comes from within. It comes from knowing exactly how to uncover your unique voice and then knowing how to use your voice to amplify your message….online.
I’ve worked with hundreds of entrepreneurs over the years, from small business owners to executives of large corporations; the most successful online businesses are not created from tactics that people teach, they are created from your very own experience.
You see, YOU have experience in your life that you can actually turn into an online business, you just need to know how to uncover it.
So lets get started!
What exactly is an Online Business?
Selling a product or service on the internet is an online business.
There are different online business models based on the type of product or service that you’re selling, but all of them have one thing in common, and that is the online sales and marketing strategy.
The first step in understanding how to start an online business is to recognize that the digital business model is still a business, in other words, in order to actually make money, you have to sell something.
What differentiates how you go about setting up your online business is actually based on whether you are selling a physical product, a digital product, or a service and also whether it’s your own product or someone else's.
Lets dig deeper.
A lot of clients that I’ve worked with in the past have said: “I’m not a salesperson, and I don’t like sales.”
It’s almost as if they are surprised that starting an online business means that you actually have to sell something.
But here’s the difference, an online business is more like “passive” sales rather than active sales.
Passive income is the buzz word that everyone likes to use these days.
In other words, passive income means that you do the work up-front so that your product or service eventually sells itself.
That of course doesn't mean that you don't have to do any work. On the contrary…
There is a shit-ton of work involved.
And how exactly do you go about setting up this coveted passive income stream?
Whether you choose to sell your own services, a product, or someone else’s product, the most important part of an online business is to get your strategy and your systems set up properly.
So lets unpack this concept of strategy and systems a little further because you may have heard that you can start an online business without actually having a product or service to sell.
The 3 Types of Online Business:
Someone Else’s Product or Service (ie: Affiliate/Influencer/Commission Based)
In a ‘traditional’ business setting, you might recognize that selling a service means something like what an accountant, an attorney, or even a life coach would do…where people pay a fee for your services.
Service Based Online Business
In the past, the clients of these kinds of professionals came from the same local town or region. However now, with the digital business model sweeping the globe, clients of professionals like this can be virtually anywhere.
But that’s not all…the reality is that you don’t need to have an advanced professional education in order to sell your own services online.
Here are a few examples of online, service based businesses that have been proven to be successful even if you don’t have a formal education:
Social Media Services
If you’re great at social media, you can manage social media accounts for businesses as your service.
You can choose to specialize in one network or a few, although I recommend becoming intimately familiar with just one or two so that you can position yourself as an expert. When using Social media for business purposes, the networks are very different. A person who is good at understanding how to optimize Facebook ads for conversion doesn’t necessarily know how to leverage Pinterest for business marketing because they are two very different marketing strategies.
So if this is your desired course of online business…choose the network you like best and become intimately familiar with it so that you can offer your expertise on that particular platform.
Virtual Assistant Services
If you’re organized, you can sell your services as a virtual assistant for many different types of businesses. Virtual assistants do everything from project management to digital marketing, so depending upon what you’re good at, you can offer your services on a contact basis.
Graphic Design/Web Design/Digital Marketing
This is the fastest growing segment of the online service based industry, and if you’re a creative person, then it’s likely you’ll be attracted to this type of service based online business. The best way to get started with this kind of business is to set up your own website and start blogging.
Life Coach/Business Coach/Fitness Coach
If you’re great at motivating people and encouraging people, you can sell your services as a coach.
Any knowledge that is above and beyond what regular people have in a particular area of focus can be sold as a service online. By making your services available online, you now open yourself up to a wider audience of potential consumers around the globe, and this is what makes an online business so different from a regular business. Imagine being able to perform services for people anywhere in the world, not just your hometown.
Selling your knowledge doesn’t stop with a service based business. In fact, one of the most lucrative types of online business is to create a knowledge based digital product.
What exactly does that mean?
This brings us to #2…
You obviously know what a physical product is. If you’re going to open a fashion boutique or sell a physical product that you create yourself such as a wreath or a bar of soap, those are physical products. A digital product means that whatever you are selling is available to access online, such as an ebook, a digital download, or a digital course.
For example, one of my side streams of income is my Etsy Shop. I create artwork that people can instantly download and print on their home printers. Have you ever seen a great quote in a beautiful font that you wished you could either print and hang on your wall or share on your social media feed? That is exactly what digital art is. Want to see some real, live examples? Click here to visit my Etsy Shop.
Digital products can generate income more quickly than physical products and the best part? A digital product based online business also applies to knowledge.
For example, if you know how to do something like make the best strawberry jam or spaghetti sauce on the planet, you can teach others how to do that on a video and then sell your video as a digital product.
More often these days, this is called a digital course. Creating your own digital course is all the rage right now, and if you know how to do it right, it’s the most lucrative types of digital businesses.
Inside my Online Business Coaching Program, I use a signature method to help you uncover your unique genius zone so that you can create a highly scalable online business. And I don't charge and arm and a leg to do it!
Because I know that your business has to be based on you, and no one else on this planet is you. That is your super-power. YOUR super power!!
Simply following what someone else does isn’t going to be the key to your success; the key to your success is to take what you have to offer, your unique super-power, and know how to structure it to fit the online business model.
Are your juices flowing yet? Are you gaining some insight into some ideas for your online business? Let me know in the comments below!
Startup Costs of an Online Business
Even though an online business doesn’t have a lot of up-front startup costs like a traditional business, it still has startup costs.
And what exactly are those startup costs?
The costs are highly dependent on the type of online business you are starting. For the bulk of online business, the costs are going to be for software tools and for online marketing.
The software tools that you will use for your particular online business will again depend on the type of online business you have. For example, if you’re a creative person and you’re thinking about selling digital downloads (like the art I mentioned above) through an Etsy shop, then your costs are going to be focused more on marketing, because there is only a minimal cost to post your artwork on Etsy.
If you’re planning to teach people how to do something and sell your knowledge, for example: how to edit videos for YouTube, then your startup costs will focus more on software, both your own (video editing software) as well as the software necessary to deliver your course content. You’ll also likely have online marketing and advertising costs, and you’ll likely use software for scheduling and research as well.
If you’re planning to do affiliate marketing (i.e.: sell someone else's product) then your cost is wrapped up in starting and marketing your blog, which includes domain, hosting, marketing, advertising and scheduling and research.
3. Affiliate Marketing (also called Influencer Marketing)
Affiliate marketing means that you blog about someone else's product (such as a piece of clothing, jewelry, or bag) and then if someone clicks over from your blog post or social media post, then you receive a commission on the sale of that product. It's very important to note that this kind of marketing only works well if you have a very large social media and/or blog following. Otherwise, the clicks just will not generate enough income for you to make a living.
Perhaps most importantly, the biggest cost will be investing in yourself. In order to be successful and make a full-time income building an online business of your own is having the knowledge of where to start and how to actually make progress.
If you need some help along the way, I encourage you to learn more about my online business coaching program. It’s a live program, that means you’ll get private access to me and my team to answer your most pressing questions about your online business, as well as walk you through your software and technology integrations to help you get your business up and running in the most efficient way possible.
Think of it as if it’s your own private technology help desk, with the benefit of giving you sound advice about online business too!
Not quite ready to make an investment? Join my FREE Private Facebook Group to ask a question and get help from other bloggers, social media influencers, and online entrepreneurs! (TIP: The Facebook Group is focused on Pinterest Marketing techniques, but it's really so much more!)