If You Build It, They Will Come ...

Tuesday, February 17, 2009

Many online entrepeneurs believe that simply "launching" a website for their online business is the key to instant success. Many online businesses neglect to focus on the "business" component of their idea or offering, which requires the same amount of market research and planning as traditional offline companies.

If having an online business was easy, we would all set up websites and be millionaires! One of the most important factors to a successful business is clients - or people that want to use the service or product you are offering.

But before you get clients you need operating capital to get your website up and running. There are a few ways to generate operating capital for an online business:

Investors - People that are willing to act as financial backers, with the opportunity to realize future returns on their investment.
Members/Clients - People that pay a fee to use your service or buy your product.
Advertisers - People that will pay a fee to have access to the members/clients that are currently using your site.

There are also two types of businesses that make the leap to online:

A business that has a successful offline (bricks and mortar) presence that is looking to expand its market share by acquiring an online customer base.
A business that is purely an online entity and has no ties to the offline world.

Regardless of which business model you use, a targeted marketing effort must be implemented to drive potential clients to your website. Some of the best campaigns utilize both traditional media (newspaper, radio, magazine and television) and online marketing outlets to create awareness and direct traffic to the website. Marketing and building a client base can be quite expensive and time consuming and many businesses do not show profit for the first 2 to 3 years.

Even companies that have created a great buzz over the last few years, such as Twitter, are now finally making the transition to being a profitable entity.

For more information about Twitter’s transition, please read this London Free Press article from February 17, 2009.

To have a viable online business you must offer a idea or solution that people are willing to use and pay for. Then you must market your idea and build an online client base. So complete the research, create a realistic business plan and remember that a successful business is not created overnight.