The Good, Bad & Ugly of Business Planning for Online Start-ups

The Good, Bad & Ugly of Business Planning for Online Start-ups

As the old saying goes “If you don’t plan then you plan to fail” and this is never truer than with internet based businesses. The good news is that you don’t need to be a genius to get it right but by following a few simple rules, who knows, you could be the next dot com success story.
Start from the top – Think about where you want your online to be in 1, 3 or 5 years time and work backwards. So if you have an ecommerce website consider you’ll probably need to hit revenue miles stones over a certain period.

Do the numbers – For example if you need to make £10k per month in sales and you have a 5% conversion rate with an average sale of £50 then it means you need to get 4,000 to your website each month.

Get to market! – So now you know how many people you need to hit your website each month, how do you do it? Make a list of all low cost the ways you can attract people. The first thing to do is consider about where your target audience hang out. Are they on Facebook, do they frequent particular places in the real world, what do they read or listen to?

 

Sell sell sell – One of the biggest mistakes you can make is using all your effort driving the right people to your website only for them not to end up buying, signing up, downloading or performing whatever task you need them to do. 

This is called “customer experience”, and can be quite expensive if you need expert advice. The secret here is to find someone who’s your ideal customer and ask them to give you feedback on your website. If that’s the kind of person that will buy from you, then take they’re feedback onboard and make the necessary changes. Common problems include not knowing where the buy now button is or generally what to do next, complicated returns policy, long forms to fill in, absence of company details and contact details, too many clicks to get something done or unclear use of terms or language. The mantra here is to not make your visitors think about what to do – it should be obvious.

Check out the competition – When someone ends up on a Google results page they’re faced with about 20 websites they can click on. That’s who your competition is, so check them out – thoroughly. Don’t worry about how fancy their websites are in comparison to yours, but moreover what their pricing is, how they’ve positioned their company, what offers they’re doing, how they’ve communicated the features and benefits of their products and service. A secret is to look at one of your competitors who are doing really well online. Chances are they’ve done lots of research and tried and tested a few approaches. So take a leaf out of their book and try not to reinvent the wheel if you can follow a successful model. Of course you need to make it your own, but learning from the best is a good thing to do when you’re starting off.

Get personal – No matter which way you look at it we do business with and buy from people we like. The same goes for companies online or offline. We also love good service and little touches that make us feel like we’ve been looked after. So again, think about your target audience and the kinds of things which they might like before, during and after the sales process. This way you can get people talking about you and evangelising your products and service – for freeJ

Case Studies

The Good – Example – A leadership learning and educational company spent 12 months nurturing a large group of over 500 members on LinkedIn. They cultivated interesting discussions, promoted value add webinars and attracted a number of influential members to the group.

Outcome – This strategy of commitment over short term revenue generation has facilitated a number of key partnerships around the world. These partners now evangelise the company, their website and drive large volumes of traffic through their online webinars, both live and recorded.

The Bad – Example – On a regular basis I am pitched with ideas for online businesses that will make a million pounds over night. The best example was someone who has an e-book for sale. They had read another e-book about how to make money online which told them to buy a good e-book which had a popular market. So, they went ahead and bought the rights to resell an e-book about making money online. The problem here is that there are literally 100’s or 1000’s of other people doing exactly the same thing. It’s next to impossible to get any kind of visibility amongst a sea of competitors who are promoting similar type e-books.

Outcome – I advised that getting niche with this kind of idea was probably a good idea. Yes it’s true that there’s a huge market of people trying to make money online. But why keep it general, how about getting really specific like, “How to make money with YouTube”, or “How to make money from your video blog”, or “How to make money on Facebook”.

The Ugly – Example – I was on the panel for a business pitching for investment on a dot com business for what seemed to be a niche in events management. The problem was that the entrepreneur had done little competitive research not realising that there were already 3 other companies that we’re doing exactly the same thing!

Outcome – We looked very carefully at the target audience and their behaviour patterns and realise that a mobile application would work much better than a website would. We managed to convince the mobile application developer to take a small 5% interest in company and the entrepreneur was able to get his application developed for free!

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