How to Start Online Business

Tips on how to start online business.

I believe the reason you come to this page is that you want to learn how to start online business. How to start an online business is not totally different from how you start any other business. However, when it comes to starting an online business, there are certain things that are peculiar to the business. The reason why some are frustrated in online business is that they didn’t take their time to actually understand what it takes to start online business. If you do it right, starting an online business can be one of the best decision you will ever make. Those people already in online business know what I am talking about.  I will not delve too much into details on what the online business is all about in this article. I assume you know the basics of online business. If you are one of the people that are asking, ‘how can I start my online business?’  I will encourage you to follow the steps below.

Read Also: Home Based Business Guide – Work from Home

Identify a need

The best way to start online business that will succeed is to first identify a need that you want to meet. I mentioned earlier that starting an online business is not too different from starting any other business. If you look around you, you will notice that there are lot of needs waiting to be met. There are various online business opportunities. But in actual sense, you may not see any of these opportunities until you can identify a need. Those people that pursue online opportunities, in most cases, are just looking for ways of making money online. By the time they start their online business and money is not flowing the way they expected, they are frustrated. They easily give up and conclude that online business is not real or that people cannot make money online. So, if you want to start online business, you must ask yourself these questions:

  1. What needs do I see? With this question, you will begin to see many opportunities.  Take your pen and list all of them as they come to your mind.
  2. Out of all the needs, which ones can I meet? This will help you narrow down the above listed business opportunities. It is expected that the ones in this category should definitely match your talent, skills and resources.
  3. Which among these opportunities can I start as an online business? Not all the businesses can be run as online business. The fact that you have an online presence for your business does not turn it to an online business. Some businesses are simply home based businesses. Although some of the online businesses are usually operated as home based business, not all home based businesses are online business. If what you want is to start online business, you should ascertain that your business idea is actually the type you can run online.

Build a website

Depending on the type of online business you like to start, you may need to build a website. Most online businesses require a website. Even when your particular type of online business, such as data entry, may not necessarily require a website, having a website can boost your income. You may need to contact a website or SEO expert in other to ensure that your website meets certain criteria that will make it to enjoy visibility. Also, with the use of Smartphones and Androids, it is expected that your website is mobile friendly.

Draft traffic to the website

Having a website is not enough. People should be able to locate your website. There are several millions of websites on the internet. For people to come to your website, you need to promote it. There are various ways you can adopt to promote your online business through website. These include but not limited to the following:

  • Advertisement on Google Adwords, Facebooks and other related websites.
  • Having good content especially if your online business is blogging. This will make you to enjoy organic traffic.
  • Listing in website directories
  • Word of mouth by telling your friends and relative etc.

Create a niche and become an expert

If you want to make a mark in online business, you cannot afford to be Jack of all trades. You need to create a niche for yourself. After you must have tested the water and discovered which online business best suit you, you should develop yourself in that area, until you become an expert. If you are a blogger, being known for a particular niche as an expert will make people to always come to visit your website. The secret is that, the more people visit your website, the more revenue you will make especially if you have a good conversion rate.

That is just a summary of how to start your own online business.

Read Also: A Guide to Starting an Online Business From Home

Analysis of Online Business

Now that you have a glimpse on how to start an online business, let’s attempt to analyse online business opportunities further by using SWOT analysis.

SWOT Analysis of Online Business


  • Low operation costs
  • Financial resources
  • Global reach
  • Ability to work anywhere
  • Low initial investment
  • Leverage on popular brands
  • Specialization

  • Customer inability to touch the product
  • Shipping costs
  • Lack of visibility
  • Insufficient funds
  • Not having secured payment platform

  • Global market
  • Growing internet users
  • Changing trends towards online purchase
  • Organic search
  • Customer loyalty
  • Social media

  • Competition
  • New entrants
  • Hacking
  • Online scams
  • Negative comments on social media
  • Preference for physical purchase
  • Threat of substitutes


Low operation costs: Unlike bricks and mortar business model where you need to rent office, furnish it and store huge inventories, online business allows you to run your business without having any office or shop. You can work from the comfort of your home. This means you don’t need to spend money on office rent and daily commuting to work. Also, you can save costs in the areas of printing and stationery. You can have just one downloadable brochure on your website instead of printing hundreds of copies.

Strong financial resources: They must have told you that you can start online business with little capital. This is true but it depends on the type of online business you want to start. At the same time, even though you start the online business with little capital, you need money to grow it. Having strong financial resources to build full fledge ecommerce and to advertise in order to drive customers to your website will set you apart for rapid growth. Ecommerce website will allow customers to place order and make payment directly on your website. Business with ecommerce website will sell much more than another online business having ordinary website for information purpose.

Global reach: Online business is able to break through geographical barriers. Your market is not limited to your immediate environment when it comes to online business. A person in African can sell products or render services to someone in Europe without them having to see each other face to face. Also, your business is open round the clock for customers. This means that with online business, you can still be making money while you are asleep. This makes you to enjoy greater earnings potential.

Ability to work anywhere: Online business is very unique in the sense that you can work wherever you are as long as you have access to laptop and internet. These days, you can even work on the go. With your mobile devices like smartphones, you can carry your business with you. You can raise and send invoices to customers, you can buy and make payments and you can send and reply important mails while you are away from the office.

Popular Brands: You don’t need to build a product from the scratch before you can operate online business. You can leverage on popular brands without having to reinvent the wheel by selling their products. You can either buy to resell or you work as an affiliate.

Specialisation: There are several online business opportunities out there. You don’t have to get involved in all of them before you can earn reasonable income. All you need to do is to identify the online business idea that suits your personality and then create a niche for yourself. If you are good at just one thing and you are able to market yourself effectively, you will earn reasonable income with online business. The market is big enough.

Social media: With social media, you can easily get connected to friends, relatives, colleagues and customers to let them know about your online business or new products. You can let your existing customers know about new product arrivals. Good enough, to open a social media page is free.

Read Also: Making Money Buying and Selling Online


Inability to touch the product before making purchase: One of the major weaknesses of online business is that customers cannot touch or assess what they are buying physically before making the purchase. They rely on the product image and the description they see online. For products that have samples, this may come at an additional cost and this may take some time before the sample gets to customers.

Shipping Costs: The costs of shipping make a product more expensive. This may make the price less competitive. If the supplier decides to bear the shipping costs, this will add to their overheads thereby eroding their profits.

Lack of visibility: The income you will make in any online business depends largely on how visible your business is. There are millions of websites competing to secure the attention of customers. If your website is not visible, there is no way customers will locate you. Spending few bulks on advertisement or on optimizing your website for search engine may be the solution.

Insufficient funds: Building a website is not expensive any longer. But if you want to build an ecommerce website, it require some investment capital. Also, it is not enough to build an ecommerce website; you should be able to draw customers to the site. This requires money too. If you have insufficient fund, you may not be able to compete in the market. You may need to get funds from external sources.

Read Also: Vital Sources of Finance For Small Businesses

Not having a secure payment platform: This problem is prevalent in African countries. There are hundreds of businesses we can do online. The limiting factor has been the lack of secured payment platforms. Some of the recognised payment platforms that people recognised internationally do not give opportunity to African countries. Few of them allow us just to make payment while denying us the opportunity to receive money. This has reduced online business to mere community based business.


Global market: We cannot take the opportunity of selling to the global market out of doing business online. With just a simple website, a customer from far away part of the world can get to know about your business and eventually locate you. That is why it is important that your website contains vital information about how prospective customers can locate you. Information such as physical address, email address and your business telephone number should be displayed on your website.

Growing internet users: The information from Internetlivestats revealed that the number of active internet users around the world has passed one billion people. This will tell you the market potential for people doing their business online. This should equally serve as an eye opener that doing business online is the best way to reach large population around the world. The use of smartphones has made internet available to many people unlike when you needed a desktop or laptop before you can access internet.

Changing trend towards online purchase: This is an information age. This is a generation that likes getting things at the press of a button. Online sales have been growing year on year basis. The people that do their business online know this fact. That is why they keep pumping money into advertisement so that thy can dominate the market.

Organic Search: You don’t need to break bank in order to get visitors coming to your website. Thanks to search engines like Google and Bing. These search engines, especially Google can draft thousands of customers to your website through organic search. Whenever people want to do business online, they go to internet to search for information. If your website is fully optimised for search engines, you will enjoy flood of customers coming to your website without having to pay a dime on advertisement.

Customer loyalty: With the use of appropriate technology, you can store information about your customers. You can also understand their buying patterns. Targeting them specifically in your marketing efforts guarantees high conversion rate. With good customer service in place, you will enjoy their loyalty.


Competition: The competition in online business is very fierce. When you do business online, you don’t compete with just other businesses in your locality, you compete with other businesses around the world. The well-established ecommerce sites pose threats to small companies that desire to do business online too. Small businesses doing their business online don’t have resources that can make them compete with the giants in the industry. The best way to compete is to create a niche for your online business. Even with a niche, you will still discover that there are competitors. Except your product or service is totally unique, competition can affect your pricing.

New entrants: Thousands of online businesses are being started every day. The entry barrier is generally low. Therefore, you have the responsibility of ensuring that you stand out. With quality services, you can quickly register your product or service in the mind of your customers and secure their loyalty before the new entrants flood the market.

Hacking: Hmmn! Hackers are terrors to people doing business online. A lot of websites are being hacked on a daily basis. This is an external force which you don’t have control over. But you can protect your online business by ensuring you take proactive steps against them. These steps include backing up your website on a regular basis, not sharing your login details with another person, changing of passwords when necessary, not logging on to your website from unsecured internet protocols.

Online scams: Business of any kind involves having trust in the other party. There are a lot of scammers on the internet these days. People are afraid to do business online. You can’t tell who is who again. To convince potential customers that you are not a scammer will take extra efforts on your part. This threat affects people that are just starting online business the most. But as you start having customers, you can ask for testimonials from them. You can display this on your website. This will enhance your credibility.

Negative comments on social media: There is nothing that can damage your online business as fast as negative comments on social media. People hardly spread good news. If the information is negative, you can be sure that it will soon go round the world. Anyone that is into online business should have a reputation damage control in place. Don’t wait till your reputation is negatively affected before you start planning on how to control the damage. Ensure that you monitor all the comments on your social pages. You can stop or block any comments that can damage your online business before it goes viral.

Preference for physical purchase: As a result of scammers that have bastardised online business, some people especially those who that have fallen victims may not want to do any business online. They prefer to deal with somebody they can see physically. They will also be able to touch and assess whatever they want to buy before they pay. But for online business, you may need to pay before you have the opportunity to touch the products you are paying for.

Threat of substitutes: Apart from the direct competition the online business may face, there is also the threat of substitute. With substitutes to your product, you may not be able to charge a high price. You need to price your product moderately otherwise your customers may start looking for alternatives.

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2 thoughts on “How to Start Online Business

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    • Hi Clark,
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