Online Business Models: Part 2

admin — Fri, 27 Aug 2010 09:01:26 +0000

It should be no surprise that the next model we will discuss is selling the products and services of other companies/brands; this is often referred to as affiliate marketing. So what are the main benefits of affiliate marketing? Well for starters you don’t have to spend time and money developing a service or product. You aren’t responsible for creating a website for the product or handling the process of orders and returns/refunds. You won’t have to waste time testing all the little details of ad copy and traffic conversions. Additionally you won’t have to convince people to sell your product/service. Sounds great right, why would you do anything else? Well not so fast now, let’s discuss some of the disadvantages of affiliate marketing.

As an affiliate you won’t make any money until you actually make sales. In order to make sales your main objective will be to drive traffic (preferably targeted traffic) to the product/service sales page. Depending on how you approach the task of gathering traffic online you will spend either time or money. Remember what I said about not needing to have a website…well that was kind of a half truth. While you could send people directly to the product/service sales page typically affiliates will create websites of their own. The reason for this would be that affiliates want to prequalify their traffic and capture the email of their visitors (this is by far a more profitable approach). One way that affiliates typically qualify their visitors is by answering many of the questions a potential buyer might have. This is achieved by writing a product review that highlights many of the products benefits and deficiencies. Affiliates will also try to entice their visitors into buying by providing additional value to the product they are selling, this is done by giving something to the visitor when they buy through your website.

Keep in mind that we only discussed two possible business models for your future online business. It should go without saying that these models may not be appropriate for everyone. What works for me might not work for you and so on. I will however say that these two models at their basic level are representative of a large amount of the businesses you will find online. So the real question on everyone’s mind should be “what model am I going to base my business on?” Start thinking about how you are going to build your business online and create a rough outline of goals, this will be your first step towards success.

Online Business Models: Part 1

admin — Fri, 27 Aug 2010 08:49:58 +0000

Starting out with an online business is no simple task. You have a basic idea of the skills and personal characteristics you will need to continue with your business but what should you focus on next? Naturally you will want to decide on a business model, what you will do to make money online. There are two basic business models that we will discuss. The first type of model would be to sell/promote your own product or service. The second model would be to sell/promote someone else’s product or service. Both of these models can require a variety of skills depending on how you approach them. Let’s discuss each of these models in detail and see which one is right for you.

Do you have an area of expertise? Would you like to help other people with their problems by providing a solution? Is your solution based on the type of information you can provide? Perhaps your solution is actually a service. Do you manufacture a physical product (tangible goods)? These are the types of questions you will want to ask yourself if you plan on selling your own product or service. First off you will want to decide on whether you are selling a product or a service. If you decide on selling a product you will also want to figure out whether it will be a physical product or informational in nature. The two types of products will have their own list of pros and cons. If your product is physical in nature there are a number of factors to take into consideration. What is the cost of making your product? The base cost of the product will fix the minimum price point and be the main factor controlling your profit margin at the lower end. How long does it take to create your product? How much of your product will you be able to store? How fast can you process a customer’s order? The answers to these questions will dictate the rate at which you will be able to make money.

Information products are among the most popular products on the internet. The reason for this being is of course the long term benefits, creating an information product only once and being able to profit from that point onward without reinvesting more time. You should also be aware of the challenges you will face when creating a product. You will have to take the time and resources to create the product which may represent a large investment upfront. You will have to create a website or platform from which you can distribute and sell your product. You also probably forgot that you will have to sell your product. This is one of the basic ways that the two models will differ. As a product creator you will have to convince others to sell your product. The people that are going to sell your product for you are often referred to as “affiliates.” Now in order to get affiliates to sell your product you will need to make a number of preparations. For one, you will need to have a sales page in place. Let’s be honest though merely having a sales page in place will not be enough to convince any affiliates to market your product. You will need to know how well your sales page converts traffic, more specifically what is the ratio of visitors to buyers. Do one percent of visitors buy your product or fifteen percent this can make a big difference when trying to convince affiliates to market your product. These are just a few out of the many considerations you will have to make in order to promote your own product.

When it comes to selling a service you may find that it requires more time and as well as a work force. Time will be a major factor when you are determining your ability to make money off of the service you are selling. Depending on how long as well as how difficult providing the service is you may find that time constraints can act as a bottle neck for your profits. One way to work around time constraints is to seek the aid of a work force or to outsource certain parts of the job. This may or may not be an option for everyone depending on the type of service they are providing but is still something you should consider. If you are providing a service you might want to ask yourself “what is the value of the service I am offering?” Is your service something that anyone can do but will pay for in order to save time? Or is your service so specific and specialized that very few people will know how to do it? The answer to these questions will help you decide on an appropriate price point. Selling a service will also require that you build a website as well as gather a sales force. Unlike a product however, with a service there is less emphasis placed on creating your sales page and understanding conversion rates. Your website should be geared more towards building your brand. You website should describe: your company, service and its many benefits, philosophy or values, and a preferred method of contact at the very minimum. Your reputation will also be an important factor in promoting a service. You would do well to provide the highest level of service as people online are very vocal when it comes to expressing their disapproval (go to any forum and you will see what I’m talking about).

Online Business Models: Part 2

Technical Skills For Your Online Business (Part 2)

admin — Sat, 31 Jul 2010 09:37:05 +0000

Search Engine Optimization (SEO) is another skill that you might have to learn. If you are planning on building your online business using organic traffic (traffic from the search engines) then you will want to become an expert on SEO. Having a website is great and all but if you can’t get people to visit your website then you might be waiting on that paycheck for a while. Now to oversimplify what SEO is let’s say that there are two aspects of your website that SEO will try to control. First there is what’s referred to as on page factors. On page SEO refers to all the things you do to your website to make it appealing to the search engines. One tactic is to have your exact keyword phrase as your domain. Your keyword density or the number of times your keyword is used divided by the total number of words. Another example would be using your keyword as the title of that webpage. For on page SEO you would also pay attention to your internal link structure (how the pages of your website link to one another). These are all fairly common examples of on page SEO. The other type of SEO you would examine is called off page SEO. Off page SEO basically describes all the other websites that point to your website. Do you have a large number of websites pointing to yours (this is often referred to as links)? Do these websites cover a similar topic and are therefore relevant? What is the Page Rank (referred to as PR) of your inbound links? Are these inbound links embedded with your keywords? The ultimate goal of SEO is to rank number one in the Search Engine Results Page (SERP) for your keywords. If you’re number one in the SERPs then that means when a person types in your keyword, your website/page will be listed as the first website directly under any advertisers. If you rank number one for any keyword on Google that means you get a free traffic source. If you are running your website correctly then more traffic will mean more money. As far as SEO goes there are a number of ways that it can be outsourced. Outsourcing on page SEO would mean hiring an expert to analyze your website and make the necessary changes/suggestions. Prices for outsourcing your websites on page SEO will vary drastically so feel free to take your time and shop around. Also you should know that a number of companies offering SEO services won’t always break up the on page and off page factors. When it comes to outsourcing off page factors you would basically be looking for link building services. If you are trying to get your website ranked, the number (and PR) of links you will need is going to be dependent on your competition. You could pay a couple of bucks for thousands of links (usually PR 0 with no relevancy) all the way up to hundreds of dollars (relevant PR 9 embedded link) for a single link. Believe me when I say it’s to your benefit to understand how SEO works.

Graphic design is among the more underappreciated skills. Everyone wants their website to look all nice and shiny but people tend to think it’s the web designer that makes this happen. Graphic design is the skill you will need to make all those fancy banners and ads that websites use to grab your attention. Do you have a product or service that you are trying to create a brand for? Well, graphic design is how you create those recognizable images that people see and associate with your product/service. Have you ever heard the phrase a picture is worth a thousand words? Graphic design helps you load thousands of words (in the form of a picture) into your website. Just think about how long it takes a person to read a 500 word paragraph (will they even finish before clicking the back button on their browser). Now how long do you think it would take that same person to look at a few pictures and form an idea about what your website is about? That’s the power of imagery; you can communicate in a much shorter period of time. People also have the tendency to click on images as opposed to words or links. Why do you think so many websites use buy now buttons and eye candy to entice their buyers? Being able to create and edit images is a truly useful skill to learn. If you are among the many people that find graphic design to be a daunting task there are a variety of programs you can use to streamline the process. Depending on what type of graphic you are trying to create the prices can vary depending on your level of expertise. Usually consumer level products will satisfy your needs and often times come loaded with content libraries. Outsourcing graphic design can be expensive or cheap depending on your online business needs. For purchasing stock photos or vector graphics online you can pay anywhere from five to twenty dollars depending on the quality. When purchasing custom banners/headers or ads for websites you might pay anywhere from twenty-five dollars to fifty dollars depending on the level of complexity. For branding an info product (e-book) you typically can buy an entire assortment of graphics for one flat rate, usually anywhere from sixty to a hundred dollars or more. Judging from the cost of various graphic design services hopefully you can see that this is a great skill to have.

Web-design, is there anything more terrifying then the thought of trying to create your own website? So what does web design actually entail? For starters web designers are the people in charge of writing the code that makes your website run/display correctly. A web designer would utilize several languages such as HTML, PHP, XML, CSS, as well as JavaScript and others. This language would basically determine the general layout, flexibility of design, and functionality of your website. Okay I have to be honest now, there’s good news and there’s bad news. The bad news is that the majority of people won’t be able to learn even a fraction of the languages that they need in order to be effective web designers. Unless you have an aptitude for learning and understanding computer languages, chances are slim to none that you will be able to learn these languages in a timely manner and still be able to maintain your online business. Now that the bad news is out of the way, what’s the good news? You don’t need to learn any of these languages to create your own website. The answer is simple and elegant …. Word Press. Word Press is a web publishing platform that allows ease of content creation/editing for its users. Publishing content with Word Press is fairly simple. The software is installed on your server and then you can edit by logging into your domains Word Press client. The general layout or appearance of your website is controlled through what is called a theme which is basically the style of your website. The functionality of your website is added through what are called plug-ins. Did I tell you that there was more good news? The best part about Word Press is that the majority of the themes and plug-ins are free. It’s for this very reason that Word Press is so popular, an estimated two hundred million websites use Word Press as of 2009. Even though Word Press makes web design an easier task there are still people out there that will want to outsource this part of their business. For people that plan on outsourcing their Word Press installation there are a number of options available. Basic installation services will merely install the current version of Word Press, which can run you anywhere from twenty to forty dollars. I wouldn’t suggest this option as it is fairly easy to install Word Press especially if you have your hosting through Host Gator. Host Gator has a rather friendly one click option for installing Word Press. If you really want to outsource Word Press Installation I would choose to have Word Press installed with a custom theme and functional plug-ins. Such a complete level of service will typically cost you anywhere from fifty to one hundred dollars or more. With that said, you should now understand enough about web design to know that your business will still be successful even if you can’t write code in PHP or HTML.

Before you begin your online business it might be a good idea to see which technical skills you have and which skills are you interested in learning. Regardless of what you find appealing, you should find comfort in knowing that your business will benefit from any of these skills. Now that you have some basic information about technical skills it looks like you’re ready to take the next step in building your online business.

Technical Skills For Your Online Business

admin — Sat, 31 Jul 2010 09:36:12 +0000

Okay so you’re ready to hit the ground running and start your online business but you don’t know where to start. If you want to achieve any level of success you’re going to want to cultivate some technical skills. Some of these skills will be familiar while others might be in another language literally (I’m looking at you CSS and PHP). Don’t be too concerned as it won’t be necessary to learn all of these skills but you should take the time to at least familiarize yourself with some of their basics. You should also know upfront that all of these skills can be outsourced; however, if you plan on outsourcing you should know that some of these skills will cost an obscene amount of money while others will be dirt cheap. Also if you’re just starting your online business you will definitely want to do as much of the work yourself as possible that way you pick up some of these skills. You should know that this list isn’t entirely exhaustive and by no means provides a complete explanation.

Writing is perhaps one of the most common skills that you will learn. You would be mistaken to think that the type of writing you will be doing is the same as what you did in high school. So what kind of writing are we talking about? The most common is perhaps content writing. People will need content to read when they arrive at your site. Content makes up the meat and bones of your site. Features and great web design are fine but without the content to back it up people will leave your site without a second thought. Article writing is another way in which you will need to utilize your writing skills, for some beginners article marketing has its appeal because it doesn’t cost anything. You will post the articles you write to a directory in an attempt to drive traffic to your website. Another way in which you will use writing is through email. If you are building a list of subscribers (and you should be) you will need to contact them through email. Writing an effective email is an art that will pay for itself many times over. And finally the last and definitely the most worthwhile form of writing is copywriting. Copywriting is a very specific type of writing that has only one purpose: persuasion. Copywriting is how you will get people from point A to point B. If you want to sell someone something, effective copywriting is what will get them to buy from you. Need to grow your list of subscribers; copywriting can convince them to join. Whatever action you want people to take, copywriting will make them do just that. Sounds great right? …. Well not really. What makes copywriting a challenge is that no product/market/person is identical. What works for you might not work for the next guy and vice-versa. This is why copywriting is such a desired skill not just anyone can read a book and all of a sudden become a guru. For copywriting to be effective you have to know which buttons to press and when, if you don’t then you’re dead in the water. Also, among all the writing skills, copywriting by far is the most expensive/profitable. If you plan on having someone produce some quality ad copy for you, expect to pay hundreds if not thousands of dollars.

Research is a skill that goes hand in hand with writing. One of your initial tasks starting out will be to conduct research. And what will you research? How about everything under the sun? Okay, not really but definitely an extensive amount of information so much that you will feel like an expert by the time you are done. For starters you will research PROFITABLE keywords. If you don’t research keywords that are profitable your business will be finished even before it starts. Keywords in essence represent the people you are trying to profit from. Every time a person uses a search engine like Google they will type in what they are searching for. This is where you come in; you want your website to be the one that they see when they search for those keywords and if you’re lucky they will buy your product. Speaking of products, you may have already guessed but you will have to research that as well. It isn’t very often that you will only have a choice of only one product to sell; it will be more likely that you will have to choose which product is “better.” Which product is better is seldom a clean cut answer. Usually there are a number of factors to consider when choosing a product to sell: how much will you profit, the quality of the product, the number of other websites selling this product or very similar products, return rate, the age of the product, is it a seasonal product, and much more. Finally, you will also have to research information/solutions that will help expand your business and skills. You should always be on the lookout for new information that can give you a leg up on the competition. Some of the most profitable online businesses are the ones that think outside the box.

Technical Skills For Your Online Business (Part 2)

Two Basic Skills

admin — Sat, 31 Jul 2010 09:34:23 +0000

If you are trying to make money online there is a good chance that you will soon come to the realization that there is a huge learning curve as far as skill sets go. Rather than dive head first into the mountain of technical skills that you will inevitably learn in the near future, it might be preferable to think about the basic skills that you already possess as well as how you will expand and refine these skills to suite your online business. There are two basic skills that your online business will benefit from: critical thinking, and effective communication. Some of you may shy away from these two skills and immediately click the back button on your internet browser (please don’t) but try and hear me out. As far as critical thinking goes let’s just say I’m not referring to the ability to interpret the works of William Shakespeare. And by effective communication I don’t necessarily mean you should be good at sharing your feelings and thoughts with people (your online business may not be the place for that). So what role will these skills play in your online business? Let’s discuss each of these skills one at a time to give them the appropriate amount of attention they deserve.

We will discuss why effective communication is important to your online business first. Generally speaking there are two scenarios where you will benefit from effective communication skills. The first scenario you will need effective communication skills is when you are interacting with your clients. Whether you are sending them an email, making a post on your blog, tweeting, or providing information to them via your website content you will need to reach an understanding. To reach this type of understanding your communications should be clear and concise. If your message is unclear it will make it difficult at best and more than likely impossible to profit from the potential client. Your communication should be to the point (which means that it makes a point) as well or at least makes efficient use of the medium (i.e. writing, video, or audio). People tend to have this sort of “instant gratification” mindset when it comes to behavior that occurs online. If it takes you too long to tell people what they need to hear by the time you are finished they will have moved on along with your chance to make a sale. When it comes to the online business world assessing the feedback of your communication can be a challenge. Your clients may not directly communicate with you to provide you with said feedback. For starters if part of your communication process isn’t working properly the only indication might be a general lack of sales. This is why tools that provide you with metrics/reports are so important to your online business. These tools will help provide you with a way of interpreting what your clients are trying to tell you. Is your website traffic leaving your homepage after two seconds? After your third email are the majority of your clients unsubscribing from your list? Do thirty percent of your buyers return the product you sold them? These are the types of questions you can answer using metric tools and understanding this “feedback” is the online equivalent of “listening.” The second scenario where effective communication is important is when you begin to outsource. Outsourcing will require a more direct form of communication but unlike the first scenario you will benefit from direct feedback. Later in your online business you will not be able to carry out every task and as a result you will outsource some of your work. Being able to manage your tasks will require that your workers understand what you expect from them. If you fail to reach an understanding the result will end badly with a great deal of wasted time and money. One of the best ways to avoid this situation is to ask the person that is charged with this task to repeat the instructions in their own words. This tip alone has saved me hundreds of dollars.

Have you ever heard the phrase one size fits all? Well when it comes to online businesses this phrase couldn’t be further from the truth. First of all the internet is constantly evolving when compared to other areas of business. What worked yesterday might not work today, and what works with one market/product might not work with another. In order for your online business to survive you will need to learn how to adapt. This is why critical thinking is one of the most important skills you can learn to utilize in your online business. For example one of the first steps you will take in your online business is selecting your business model (how you will make money). You will have to put that model into action, and then critique how well it works for your business. In order to make effective decisions you will have to gather information, analyze that information; and then make modifications to the processes involved, or examine competing models and repeat this procedure. If you apply this skill to almost every part of your online business it will be difficult for you to fail.

When considering an online business it’s important that you take into consideration the skills necessary to succeed. Stereotypically people will be frightened at the prospect of failing because of their lack of technical skills, but really it’s the basic skills that will carry your online business. After all, you can learn the technical skills over time. You might not realize this but if you have these two skills you are actually already ahead of the competition. You should also be aware that effective communication and critical thinking skills aren’t completely unrelated, often times you will be coordinating these skills to reach the same end. By now you should be feeling pretty confident about starting your online business and ready to face the challenge of learning some of those technical skills.

Online Success: What does it take?

admin — Sat, 31 Jul 2010 09:31:23 +0000

What does it take to be successful online? Naturally you might want to think about the upfront cost of starting an online business, the skill set you will need to acquire, the amount of time you will spend before you even see any money coming in; however, none of these answers are what you really need to be focused on. The truth is, the one factor that will have a tremendous effect on your business is ….well you. There are a variety of personal characteristics that will contribute to your success as well as your failure. You may start to get the idea that I’m a somewhat pessimistic person by the tone of my writing, but let me explain myself. In the online business world both success and failure can be beneficial depending on the person and situation. Now nobody would argue over the benefits of success but what about failure? Failure can be a good thing when you learn from it. Of course you wouldn’t want to fail all the time, eventually you would want to succeed, and what would you use to get past all that failure? Determination/perseverance, this is one trait you will definitely want to possess if you plan on being successful in the online business world. Nobody gets anything right the first time they try it let alone the second or third time, but so long as you keep plugging away at it, eventually you will succeed as a result of your determination.

Another characteristic that defines successful people is that they have the appropriate mindset. For starters optimism is something that you will need in the early stages of your online business. Optimism is important in the early stages because you will be putting forth a great deal of effort and spending a lot of time without receiving much in the way of rewards. You’re going to need to believe that you will succeed. Have you ever heard the expression assume the sale? What this means is that you should behave as if you have already achieved your goal. By doing this you prevent yourself from becoming passive or inactive in your own work processes. If you establish this kind of behavior early on you will form great habits that will serve to bring you closer to making money online.

The next type of characteristic you will want to acquire is an open mind. You will need to have an open mind if you plan on achieving any degree of success with an online business. The large number of skills that you will learn through your online business will demand that you have an open mind. I know that everyone isn’t comfortable with web design, or keyword research, but if you don’t allow the novelty of these processes/skills to intimidate you, making money online can really be rewarding. Also if you plan on participating in any kind of online community, forum, mentor or coaching relationship, you will need to have an open mind so that way you will listen and learn from what others have to tell you.

Successful people are also highly organized. Being able to not only structure your time but the multitude of tasks that you will be juggling throughout the day is a godsend. The most successful people are the ones that do the following: set goals, set timelines, make adjustments to their processes, and monitor their effectiveness. I’m certain that there are a number of people that are naturally disorganized and I am by no means suggesting that you will fail if you don’t become organized; I’m merely pointing out that your efforts will definitely improve as a result of adopting some form of systemization. When you first begin your online business there will be this period of gross adjustments as you iron out the basic processes of your business; but as you gain experience at making money online you will want to maximize your profits and minimize your efforts, this will require some fine tuning (which is when your organization will pay off).

The final characteristic that you should develop to make money online is skepticism. You will need to be a natural born skeptic if you plan on succeeding in the online business world. First of all when it comes to the online world there is a staggering amount of people that will tell you that you need their services or products in order to succeed (…..and you really don’t). You will need to be able to evaluate how your online business will benefit from these products or services; skepticism will come in handy whenever you contemplate “investing” any of your hard earned money. One of the best ways to increase the money you make is by minimizing the money you spend. New online business marketers tend to have the attention span of a goldfish. They will try something out for a few days or weeks and then they will give up and move onto the next shiny new toy. Having an inherent sense of skepticism will help to safe guard you from spending more then you should. Skepticism is also a great tool when it comes to evaluating your processes. Achieving your goals is great but if you really want to be successful you will need to figure out how to reproduce your methods of success. The only way to truly reproduce your success is to evaluate the merits of your processes and see if they are indeed producing said results. This can only occur if you are a skeptic.

To be successful at building an online business you will need to be determined, optimistic, open-minded, highly organized, and finally skeptic. While this isn’t an all inclusive list of every possible characteristic that you will need to succeed, it’s definitely a good start. Hopefully reading this will not only inspire you to reflect but also put into action the changes that will shape the future you.