This fall I have been taking a class on how to create and run a successful online business, and I thought I’d write about some of the things that I’m learning. The idea is to reflect about them, and maybe this can also help those in need of advise on how to create their own business.
When thinking about starting an online business, one may think that is all about having a groundbreaking idea and just get started right? Well, let me tell you is not quite like that.Of course having a good idea is important, but there are a few other things that need to be considered:
- Business Idea vs. Business Model
First things first, you need to think about is your particular situation and see if you prefer to start by thinking of a Business Idea and then a coming up with a Business Model that suits your idea, or vice versa.
In my class, we had a discussion about the matter and most of my classmates thought that thinking about the idea first was the best option, because it allows you to do something that you really like, and it is easier to adapt the idea to any business model than the other way around.
In my opinion, it doesn’t hurt to look at different models before you start an online business. In case that you don’t know, a business model is basically the method you use to make money. There are a number of models that can be used, and I know that studying about them was very useful to me. It made think about how much I was willing invest (in terms of money and time) in case I run an online business, and it was also interesting because it helped me understand better how online businesses work.
Anyway, if you prefer to start by defining your business idea first, you can ask yourself the following question: Do you have a passion or something that you are really good at? If that the case, perhaps you could start by thinking if you can convert that talent or passion in a product or service. For example, someone in my class mentioned that they already run a horticulture business part time, and they were thinking about creating a business related to that.
If you have trouble thinking about a good idea, you may take a look at a site called bizthoughts. They have an article in which they explain different ways of brainstorming . I found it very useful and I think that some of those methods can help you come up with great ideas, if you don’t have one already. My personal favorite is what they called “The Problem & Solution Method”.
When I read about it, I couldn’t help but to think about all the “problems” that I could be “solving” with my online business. I’m sure not all of them are good ideas, but maybe this can lead to something interesting. How to find out if you have a good service/product in mind would be the second step when creating your business.
2. Evaluate your Idea Objectively
This week, we learned about the importance of objectively determine if an idea is good or not. One of the first things to be considered when doing this, is the levels of demand and competition.
To determine demand and competition you can use Google Adwords which is “an is an advertising service for businesses wanting to display ads on Google and its advertising network. The AdWords program enables businesses to set a budget for advertising and only pay when people click the ads. The ad service is largely focused on keywords.”
By using their service you can access their Keyword planner which is a tool that allows you to see the traffic you get when you input your business idea. This will help you understand if what you want to sell has a high level of demand and/or competition.For example, for our class we had to research about the keywords chess and snowboard. The results were very interesting, on one hand we had chess with a high level of demand and low competition. And on the other, snowboard with high demand and super high competition.
Almost everyone in the class agreed that, for this particular case that we were analyzing, chess was the best option, because of the high demand and low competition. Some of my classmates also pointed out that it would required less investment, and bring less problems when it comes to shipping. Others, like me, thought that the low level of competition may be caused by people not wanting to spend money on chess and that snowboard were more secure.
Now, what I loved about the method that we use in my class is that by discussing and sharing different opinions, we get really good conclusions that wouldn’t come up with if we were doing this on our own. There was one particular post that I thought was very cleaver. My classmate Jay said the following: “When I was doing AdWords for chess a lot of recommended key words had to do with online chess games or purchasing a chess board. I tweaked my search a bit and put in “how to play chess” for the keyword…The competition for the key words that had to do with information on chess were very low ( between .2-.49). The amount of search’s per month of all 10 key words combined was 8100k. This data showed that those key words get quite a bit of traffic going to them with limited competition. This would be a perfect set up for a informational based website that made money through advertising.”
I think this is a great example on how to use Adwords as a research tool for an online business, and being the newbie that I’m I would have never thought of doing something like that for my own business idea.
**Other articles that I found useful/interesting this week **
3 Pointers for Choosing a Business to Start ; 5 Unique Online Business Ideas, Small But Successful ; Loving this one: Online Marketing Training
How to Create a Successful Online Business 