04 Jun How To Build A Successful Online Business
You’ve probably heard that 90% of people who start an online business fail within the first 120 days.
For the May edition of #SFANLiveChat, we invited two entrepreneurs who have each built a remarkable online business to share their insights on how actually to get it right.
Kojo Dougan is the Director of Interpay Africa, an electronic payment platform that makes transactions and e-commerce simpler, secure, and seamless. Simultaneously, Melissa McCoy is the Founder and CEO/CTO of ConnectMed, a South Africa and Kenya-based online business in Medicare, dedicated to helping patients access quality and faster/efficient healthcare. Google has acquired this company.
The combination of their expertise served our agenda very much. Below are some of the thoughts from the chat that stood out to us on building a successful online business.
A step-by-step guide to building an online business that serves the next billion
1. Find a need and provide an epic solution
“You have to solve a problem that people actually have. But it’s not always a problem that they know they have, so that’s tricky.” — Joshua Schachter
Many people who are beginning their entrepreneurial journey often focus on building a product or service before finding a market. Unfortunately, this is one major reason for the failure of many startups. But to improve your chances of success for your online business, Kojo says, identify a need and aim to provide a relevant solution to that need.
In most instances, you’ll need to do some research to understand where there are gaps in the market. Listen to your frustration or those of people around you. Find out what people are complaining about.
When you have identified the market gap, then you’re set to dig deeper:
- Why is the issue persistent?
- How do people currently solve this problem?
- What can you do better than the players on the ground?
The result of this research will help you create a solution that pays off. “‘Paying off’ to me means that we’re positively affecting our patients’ lives — every time we do that, it’s worth it,” Melissa says.
2. Build your tribe
“If a tree falls in the forest and no one is there, does it still make a sound?” — Jehookah Jarmon.
You may have equally heard the clichéd phrase, “build it, and they won’t come.” Guess what, it’s true! Just because you’ve built a cool online business does not mean that customers will come to you by auto-pilot. To find people interested in your online business, Melissa says, you need to do the legwork of identifying an already established market or a new one.
Depending on your online business, the first thing to do in finding your users is to create a clear picture of who this hypothetical customer is. “We create user personas — young professionals, new parents, university students, and shift workers — that we developed through surveying.”
Position yourself as a customer, Kojo says, would you revisit several times? Would you be interested in making several purchases? Use the product again? “Observe, listen, monitor, personalize the solution; the user experience is key.”
Mastering the art of copywriting
Whether you’re creating a new product for an existing market or creating a new market, you need to master the art of copywriting. “We use HubSpot to do A/B testing on emails to decide on the best copy,” Melissa says: We also create our own A/B tests with Facebook Ads to see what’s best.”
If you choose to create your own copy, this article by Henneke Duistermaat has valuable insights on how to nail it like Apple. A great copy helps you highlight your value proposition and find your tribe.
3. Create a monetization strategy
“The single necessary and sufficient condition for a business is a paying customer.” — Disciplined Entrepreneurship: 24 Steps to A Successful Startup by Bill Aulet (2013)
Now that you’ve acquired an audience for your online business, you need a strategy to turn them into loyal customers and brand ambassadors.
To convert your website visits into sales, it “must be informative, interactive, simplified, and allows visitors to sign up or understand how to use your product/service,” Kojo explained.
At ConnectMed, Melissa and her team leverage analytics to understand their users and deliver better services. “We have a funnel (site visits > signup > consult) and use event track to quantify where users fall off and session record to qualify why.” She says: Basically, pick one metric (for us, it’s consults booked) and then understand the funnel to get there and keep optimizing.
A word on pricing
In a previous chat, we looked at how you can price your product or service. Although the focus is on a different audience, it has valuable insights you can apply in pricing your online business.
At Melissa’s ConnectMed, they started with a higher price point to ensure their product is perceived as quality and then offer a discount on the first one to try.
But at Interpay, Kojo says market forces influence their strategy. “As we have progressed, we have passed on economies of scale to our merchants.”
4. Review and Refine your process
“Ideas don’t come out fully formed.” — Mark Zuckerberg
When you have implemented your preferred model, always review what works and what doesn’t, Melissa says. “Try to listen to the committed users that love you for determining best-added features. Our product development has been iterative — we started with a base telehealth platform and added features based on user feedback.”
Kojo reiterates that you must also pay attention to your existing clients as much as you want to acquire new clients for your online business. “Learn, learn, learn; know what’s trending and stay ahead of the curve.”
How to launch your product or service
You have some structure and process; then you’re ready to play in the big league.
It’s time to launch and scale your impact. Here’s how to get it right:
- First, decide on the type of launch you want for your online business — either a stakeholder launch or media launch.
- Then you need to figure out your timelines. It’s always great to have enough time for pre-launch PR. Do not neglect the impact of influencer marketing; try to make your product available to key influencers in your industry for some great reviews/publicity.
- If you don’t have an elaborate budget to do a massive stunt, get on with what you can do and start marketing. The launch date is for you to tell your audience that a new kid is in town!
- Understand that it’s your job to create your press release; many bloggers won’t have the time to edit or review it unless you’re paying for that service. Also, know when is a good time to submit your article to enhance the chance of getting published. Aim for the local bloggers first as they’re the easiest to reach.
- You’re the PR girl/boy of your brand; keep releasing fresh insights, products, and announcements to remain visible to your audience.
When you have something great going on, the city needs to hear about it. Make as much noise as you can about your online business.
A word on achieving scale
Once you’ve launched your product or service, it’s time to scale your work. Depending on what you’re offering, look for strategic partnerships that create better leverage. Partner with banks, MNOs, MTOs, FSPs, to provide a solution to end-user; Kojo advised, “our online business will not be where it is today without our partners. We have two categories: partners and merchants.”
Unleash the power of email marketing. Experts have confirmed that email is the crown jewel of an online marketing strategy.
According to McKinsey, Email marketing generates 40 times more revenue than Facebook and Twitter — combined! Actually, you are 6x more likely to get a click-through from an Email than from a tweet. Furthermore, Email marketing can generate an ROI of 3800% and $38 for every $1 spent.
To grow your mailing list, work with partners who you can incentivize to share their lists (e.g., every booked consult from a user on their list gets X KES), Melissa says. Also, you can table at events to get participants to subscribe to your list. “Finally, a pop-up CTA on the site that asks for an email in return for the discount has worked well for us.”
The bottom line
Building a successful online business takes time and skill. But like every skill, it can be learned. As we’ve established above, if you build it, they won’t come. Take the advice of the experts: a) Find a need and provide a viable solution to it; b) Build your market — find the people that need your offer; c) Ensure you have a monetization plan; d) Ensure your product development is iterative; e) Launch and Scale.
“Stay focused, don’t go alone; work with your team, get your team motivated, believe in your dream, believe in your team, be mentored, don’t wait for a perfect moment- just create it,” Kojo concludes. Do you need help building your online business? Get support here
Tom-Chris Emewulu is the Founder & President of SFAN (Stars From All Nations). When he’s not building SFAN and helping entrepreneurs and rising professionals create fulfilling careers, he’s telling African innovation stories or advocating for people-centered policy. Tom-Chris is a former consultant at Mastercard Foundation, Seedstars Ambassador for Ghana, and the author of the forthcoming book: Breaking the Limits. He is a thought leader on youth development, social entrepreneurship, technological innovation, and the future of work.