Starting a web business is an exciting prospect but it can be daunting as you contemplate a journey into the unknown. Many people pull back at this point and avoid pursuing their dream of starting a online home business simply because they don’t know where to start.
Don’t do that! Don’t let caution drive you to inaction! Instead, get excited about the possibility of starting a business! The fundamentals of doing this are easily learned.
And if you follow the web business ideas outlined here and elsewhere on this website, you’ll have all the skills you need to start a web business. In fact, if you follow some of the step-by-step processes, you will own a web business!
Don’t make this mistake
One of the very first questions people ask when they want to start a web business is: “what should I sell?” Few people realize that this is the wrong question to be asking and it’s quite possibly one of the main reasons why a majority of web businesses fail at the outset.
Rather than asking “what should I sell?” entrepreneurs (like you!) should be asking “who should I sell to?” The answer you get will help to increase the likelihood of your success.
Why? Because your success is dependent on other people (your customers), rarely the products you sell. So by putting the focus on them right from the very beginning, you’ll increase the likelihood of your success.
Knowing what you are going to sell is not necessarily going to help you sell more products or service and it’s not going to help you market those products and services more effectively.
But, by the end of this article, you’ll know that who you are selling to will help you be more effective in marketing your products… and in the end, help you to sell more!
Define your target market
The very first thing you’ll want to do before starting your web home business is to define your “niche.” A niche is a segment of the population made up of your potential customers. A niche includes similar people and excludes dissimilar people and is vital to your web business.
A niche can be made up of people who share a similar age, gender, economic bracket, hobbies, ethnicity, occupation, or some combination of several of these attributes. Some examples of a niche include:
- Wealthy retired people over the age of 65
- Auto mechanics
- Children, ages 10 through 12
- Spouses of military personnel
People ask all the time, “Why do I need a niche? Won’t I get more customers by simply selling to everybody?” The answer to that question is best illustrated in an example. Imagine that you’re selling something that each person uses… like shoes, for example. If you tried to advertise your shoes to each of the above niches in the same advertisement, what would the result be?
Retired people are likely to want shoes that are comfortable and versatile. Auto mechanics are going to want shoes that are durable and won’t slip in spilled oil. Children are going to want shoes that are fun, popular, and easy to play in.
So instead of saying “I’m going to sell shoes and everyone is my potential customer” you will enjoy much greater success by identifying your target market and limiting your products and services to them. This will save you money in marketing your products and will help to increase your customers.
How? By defining your niche to be very specific, you will save money in marketing because you won’t be spending it everywhere. (If everyone is your potential customer, you’ll end up advertising in plenty of general media and will find that you won’t be nearly as effective). Defining your niche lets you advertise in targeted media… and targeted media has a better chance of reaching your audience.
By defining your niche, you will increase your customers. The saying “birds of a feather flock together” is true: your customers hang out with people just like themselves. If you position your product or service as servicing a very specific market – your niche – you will enjoy the cheapest and most effective form of advertising: word of mouth advertising.
Consider this example: if you sold shoes and “everybody” was your client, do you think a young child would run up to a retired person and ask them where they got their shoes? Of course not! But a child in the playground will notice another person’s shoes and that night will claim that the only way they’ll be accepted among their peers is by wearing the same shoes. And the next day, mom or dad will go and buy the shoes.
That’s the strength of having a great niche.
How to pick a niche
So how do you pick a niche? We’ll go through a very specific to-do list shortly, but here are some tips:
- Choose a niche with a lot of influence: children influence each other and their parents. Babies are very influential even though they can’t talk.
- Choose a niche with money to spend: Although children do not earn money, they have money to spend – their parents’ money! Retired people are another group that has money to spend. People who have just made a major purchase (like their first home, for example) do not have nearly as much money to spend.
- Choose a niche that spends time with each other: marketing to hermits probably won’t help your web business. But marketing to soccer moms will… soccer moms hang out with other soccer moms while their children are playing on the field.
- Choose a niche that you understand well: you’ll be more likely to identify with that niche if you do. Knowing your clientele very well will help in your marketing efforts.
- Choose a niche that you’re excited about: there’s no use in selling products to babies if you don’t like babies… even if they are a lucrative niche. People will detect your disdain and do business elsewhere.
Identifying your niche
Now it’s time to start identifying your niche. You’ll probably want a pen and paper for this task.
Write down several niches that you belong to. Some day you might want to start a business for someone in a different niche than you belong to, but this is a good place to start. Here are some questions to help you get started:
- What is my gender, age, and ethnic background?
- Am I a homeowner or do I rent?
- Do I like to travel?
- What is my average income?
- Do I have children? What are their ages?
- What hobbies do I have?
(businesses choose these small niches, also called “target markets” to sell to. The smaller the niche, the greater likelihood of success).
It isn’t unusual to have a specific niche of (for example) white, married businessmen, ages 29-45, with an average income of $45000 who own their own homes and have 1 child. That’s a very specific niche!
Now the task gets harder: narrow your niche. Trust us on this one… narrow it further. It is very unlikely that you will lose out because of a narrow niche and most people find that the narrower their niche, the better! How can you narrow it?
If you have not specified a gender, be bold and market just to one gender. (Female auto mechanics, for example, is a fantastic niche with a lot of potential… don’t make the mistake of thinking that just because there aren’t very many female auto mechanics you’re going to limit your business.
You will likely sell more products because you advertise only to female auto mechanics!). As you gain experience, you’ll learn why narrowing your niche is so important and how you can market effectively to that niche.