Online Business is Still Business

I’ve worked with a lot of first time online entrepreneurs over the years and one of the things that always strikes me as naïve is the thought that online business is substantially different than offline business. That you can cut corners with an online business. This is simply not true.

I think this comes from the reality that the barriers for entry into the online business world can be much smaller than those offline. Hosting is generally cheaper than paying on a lease for office or retail space. The web is full of inexpensive ecommerce “builders” and solutions. (although we all know that the quality varies greatly) Affiliate marketing opportunities mean you don’t even need to stock inventory. Blogging is open to everyone. And the web makes it easy to connect with people all over the world. The playing field is more level than it has ever been.

But this does not mean that the basic rules of business do not apply. So today I am going to share the common errors and misconceptions that often plague online entrepreneurs.

1. Not laying the proper foundation- If you are going to be in business you need to set your business up properly as a legal entity and comply with all the tax and business laws. So often I’ve seen people try to create a website and find vendors, partners or resources without taking this vital step. You need to take your business seriously before you can expect anyone else to. One of my favorite quotes is “Treat your business like a business and it will pay you like a business. Treat your business like a hobby and it will cost you like a hobby” Unfortunately I’ve been unable to attribute that to anyone, although I heard it while listening to Lisa Suttora.

2. Not dedicating enough resources- While it can cost much less to get started with an online business, that does not mean that there are not expenses. If you cut too many financial corners it will take longer to see results and it may even keep your venture from getting off the ground.

3. Not advertising- so many new online businesses expect to appear in the organic search engine results immediately and become frustrated when this does not happen. And because those organic search results are available many online entrepreneurs believe that they can have a business that does not require an advertising and promotion budget. Nothing can be further from the truth. It is simply ridiculous to think you can have a business that you do not have to advertise. Also, if you only rely on organic search results for traffic you are leaving money on the table; there are many other ways to get people to come to your site or blog. And while some of the techniques for promoting a website or blog do not cost any money those same techniques do take time, sometimes a lot of it. Time is much more valuable than money. Successful business requires marketing- period.

4. Hiding from their customers- The web makes it easy to be anonymous. But that does not mean that you should hide from your customers. If you are selling a product or service online you need to make it easy to contact you. You should be transparent about the identity and location of the business. People need to trust you in order to do business with you. If you are ashamed of what you sell, annoyed by customer contact or are too busy to be bothered with customer service don’t go into business.

5. Trying to understand new technologies without help- We’ve all heard the stories of the computer illiterate grandmother making a killing overnight with a website she put together herself using a simple builder, or the 13 year old making four figures a month off their blog. And these things do happen, occasionally. But that does not mean that this is easy. Ask questions; don’t be ashamed of not knowing how to do everything.

6. Thinking that it will happen overnight- Again, we’ve all heard the stories of the instant internet millionaire. Yes, again, it can happen. But that is rare, that’s why it stands out. Online business is like every other business. You have to work at it consistently over time. You have to build it. Sometimes you have to invest the money and not see an immediate return. That is the truth.

Doing business online can be a rewarding way to make money by itself; or it can help an offline business interest grow substantially. Approach your online venture with a healthy mixture of optimism, excitement and realistic expectations and you’ll find that you are far less frustrated.

Tagged as: entreprenuer, General Business, online business