What’s the quickest way to achieve financial success? Become an entrepreneur and eventually sell your business for a big profit. You’ll need to start or acquire an online business (at Flippa we believe in acquiring an online business to give yourself a head start), and then understand how growing an online business can result in a successful exit.
Over 65 percent of people in America still believe that the American Dream is within reach. Many also believe that in order to achieve the American Dream, it requires a certain level of financial stability. Unfortunately, 20 percent of startups fail within their first year. In order to get to a point where your company can be sold for a significant chunk of money, it first needs to focus on circumventing the common challenges facing online businesses and finding a way to successfully grow itself. Here are the five biggest challenges of growing an online business and how to overcome them.
Fierce Online Competition
In many ways, competition is the foundation of capitalism. However, when it comes to operating a small online business, competition can often be overwhelming. Having a little bit of friendly competition is good for business because it forces companies to be innovative. Unfortunately, when it comes to the online marketplace, there seems to be simply too much competition in most industries nowadays. In fact, there are as many as 24 million e-commerce sites in the world. This can often make it hard to find ways to stand out amongst the endless sea of other competitors.
Luckily, there are a few things that can be done to improve the chances of potential customers noticing your online business before any of your competitors. One of the most effective things to do is to ensure that your website is developed in a professional style that is in compliance with the current Google algorithms. This will help on two distinct fronts.
Firstly, it will help your online business rank higher in search results, which will lead to higher click-through rates. The second way in which this will assist you is by being eye-catching as soon as the web page loads. Being greeted with a professional-looking website can often be enough to convince a customer to do business with you.
Getting new customers to visit your site is only part of the challenge online entrepreneurs face. Once they are on your site, you need to find a way to convert them into returning customers. Having a loyal customer base that repeatedly does business with your site can help to vastly improve your annual revenue.
Not only will it result in more sales, but it will also lower your costs. This is because acquiring a new customer often costs up to five times as much as retaining a current customer. Therefore, online companies need to find a way to retain customers as much as possible.
Unfortunately, there is no magical shortcut to ensure customer retention. It requires improvement in every part of the customer experience. However, improving the return and refund policy of your online business is a great start.
When a customer is new to a site, they often have some hesitancy about the product or service quality. In order to help ease their anxieties, successful online startups offer an extremely easy return process. This allows customers to simply send the item back within a certain period of time and receive a full refund if they are not satisfied with a product or service.
So if you want to retain more customers, then you need to make your return and refund policies very simple. This involves having as few steps as possible and following through with your promise to return the customer’s money. This will make the customer much more comfortable with an online business and a lot more likely to continue doing business with them in the future.
Getting Sufficient Revenue
It is obvious that to be a successful online business, you need to get a lot of revenue. What is not obvious is how to go about doing this. There are a lot of different methods that can be used to help improve revenue. Some of the most popular include lowering product prices or reducing operations costs. However, one of the most sustainable ways to get higher amounts of revenue is to increase sales numbers.
Once again, there are numerous ways to go about this. An effective place to start is with the website’s design. It needs to have a layout that is incredibly easy to navigate and a purchasing process that is as short and simple as possible. This will help minimize the frustration that customers experience when dealing with the website, which will help to vastly improve sales numbers.
By overcoming these three challenges, your online business can quickly reach a point where it can be sold for a significant amount of money. Once your company is at a point where you are ready to sell it, visit Flippa to get it sold as quickly as possible for the maximum amount of money.