There seems to be a definite pattern with people who want to get into an online business of some sort in that they start with the same questions: where do I start and what should I sell? Well I think these two questions actually fall under the one action, because before you do anything, you should probably decide on what niche you wish to get into. So I’m going to outline a few points that will nail the initial questions so you can get started on the meaty stuff.

Before you do anything, think of a field that you know a lot about or think of yourself as an expert in. Try to find something you are really passionate about as this helps, but it not necessarily an essential. Now once who have a few ideas, put them to the following tests:

1. Is there competition?

People often associate an industry that has plenty of competition as being an industry you should stay away from. I think that’s quite a silly approach because why else would there be plenty of competition other than the fact that it’s a profitable market? If there are plenty of people advertising to this market then that’s a good sign. If the market wasn’t profitable then why would people keep advertising? Use you competitors as your market research.

How do you do this? Let’s use “weight loss” as an example. The first step is to do a Google search for, you guessed it, weight loss! Now once you do a search have a look at the right hand side of the page at the sponsored listings. Its full. Check out the more sponsored links tab the the bottom. 54 pages of weight loss ads! 54 pages! I feel sorry for the guys on like page 32.. Who’s ever visiting these guys? Now go back to the original search and visit the top sites in the organic search. Do they contain a lot of advertising? Banners? Adsense? You get the picture.

2. Clickbank it – Is it popular lately?

No not Google it. Clickbank it. Clickbank is the largest affiliate network for digital products online. I’ll go into a little more detail of Clickbank later in this report but for now quickly visit Clickbank (www.clickbank.com), go to their marketplace (small link top-right of screen) and do a search for your niche to see what comes up.
Now you need to take note of how many products are for available for promotion and the more the better. Its for the same reason we did the Google search earlier. More advertisers = more people buying.
But most importantly you need to have a look at the “gravity” of the product. You can find this under the product description in a faded grey text with other info such as $/sale, %/sale and so on.
I’m not going to explain gravity because that would take me forever and I’ll end up getting confusing myself. Just take my word for it. You want a higher gravity. The higher the gravity the more that item has been promoted and sold recently. Gravity places emphasis on recent interest and sales of that product but in short, the higher the better.

3. Google Keyword Tool

This is different to simply doing a search in Google. Google’s Keyword Tool (do a search for Google Keyword Tool) allows you to see the volume of searches for particular keywords. So back to the weight loss example, the search term “weight loss” has a global search volume of 5 million searches. To put that into perspective “learning guitar” is at about 350,000 searches and “cheap flights” is almost 24 million.

4. Ebay Pulse

A great final test especially relevant for physical products is using Ebay Pulse. Visit pulse.ebay.com. Ebay pulse tells you what’s hot on Ebay right now, a great indicator of what is selling well on the internet. Great to use especially if you want to sell physical products.
The conclusions? You want to sell something that is high in demand, being sold recently and is a proven profitable market. If your product gets a tick for all these tests then your product is sellable and most likely profitable. Don’t be afraid of big markets just because there is plenty of competition. Where there is plenty of competition there is even a bigger market and getting a small piece of the cake is much easier than trying to take the whole thing!

(This is straight out of my ebook, Bootstrapedia. If you want to get a copy, first grab your version of Think and Grow Rich and I’ll also send you my book!)

Celltube.mobi screenshot

Ok I need to be completely honest here. It’s been a while since I updated my last step by step business post and that’s not because it hasn’t been done. The fact is that the programming was done on time and on budget which is fantastic however I have been so busy working on my Ebook that I haven’t had a chance to update you guys.

However behind the scenes I have still made an effort to get something up and running. I decided on a name as well! Even though I am located in Australia I decided to use a name that would appeal to the US market predominantly as well as something relevant for the large, and mobile savvy European and Asian markets. The name needed to be catchy and very easy to remember yet be quickly recognized as a mobile site.

The name I decided on was Celltube.mobi. Looking at the name immediately you know the type of service you could expect so there is no fiddling about by the user, trying to figure out what this site does. I also wanted something easy to remember which I believe I have achieved in selecting this domain.

With all the other fiddlies done (domain, hosting) along with a simple logo I conjured up myself the site went live almost immediately. I was able to drive traffic using only a few dollars in Google mobile advertising as well as my mobile gaming network, Thumb Doctor Games.

The site has been live for about 4 days and already receives recurring traffic and about 110-140 unique users a day. Unfortunately due to my other committments I have been unable to implement many of the earlier features mentioned. At the moment I am monetizing the site through Admob mobile ads as well as Google Adsense mobile which although is not ideal but will work well while I work on building traffic.

My aim will be to develop a loyal following over the next few months. After a steady community has developed, I will look at charging a small monthly service fee to download the videos. Currently this simply wouldnt work as the pain for a user to switch is simply not high enough. Only until they have developed a bond with the site and it’s service will it be effective to charge for the value offering.

But I think for $72 plus hosting and a domain this has turned out quite well. It’s unfortunate that the timing on my end hasn’t been ideal due to the development of my ebook and associated products. On the same note the service is completely automated and does not require me to edit or add any content so its simply a matter of optimising the site for traffic and working on the revenue model. Plus it’s already making me a bit of cash on the side, nothing to brag about yet, but its just a nice little passive income stream that cost me a tiny $72 to set up.

To check out the previous steps click here

I know its been a while since my last step of my Step by Step Business series, but it’s been an extremely busy “while”. I’m in the process of writing an ebook which I’m very excited about however has taken up so much of my time. However I have taken a break to update you on my new business.

The last step I did was Step 4, which to me is probably the most important step and this is to take action. I got some great feedback from a great bunch of programmers and the costs to get this done ranged dramatically. I had offers anywhere from $50 through to $2000. I’m not kidding. The strange thing was that the established and highly rated guys were in the lower price range compared to the newbies asking for the higher end programming fees. This tells me that just because the guy asks for $2000 doesn’t mean that it will be a better job that the guy who’s asking $150.

So what did I do? Well luckily for me one of the programmers was able to direct me to an already existing script. What this script did was search the net for videos, live stream them to phones and give the user the option to download these directly to their mobiles. Perfect. So essentially what has now happened, is that I have gone from requiring something custom made to simply needing a decent programmer to bolt on an already existing script and tailor it to what I want.

Naturally, I picked this helpful programmer to do the programming for me. Cost? Wait for it… $72. That is not a joke and this includes the script. Yes that’s $72 for the programmer and the script! So with all things being equal the entire programming to get the basics up and running will cost me a whopping $72. That’s the equivalent of a nice dinner, 1 shoe (not the pair), ink cartridges or a low key night out.

Whoever said you need money to create a product needs to read this post and my Starting up a Business Series. Anyone who uses the excuse “I don’t have the money”, yet just bought a new shirt, needs to read this. Don’t worry, I can safely admit I have been there and made the mistake of spending so much on a prototype. Learn from my previous mistakes as well as my current example to not fall into the trap. Do your research, take action and act in a frugal manner to ensure you get the best deal without paying for nonsense.

The next step will involve the final touches before it goes live and this will be done on the completion of the programming. I’ll need to give it some functionality tests as well as the real world experience required. I have been told that it should only take about a day but this is always a variable when it comes to programmers! Until then I’ll be thinking of a name and getting a simple logo created.

Its quite a broad area but one way you can make money without money online is through selling products online, more specifically in this case, through drop shipping.

I have written a previous post about the pros and cons of drop shipping but in this post I will talk more on how to get started.

A drop shipping business is basically where you sell a product, either online or offline, and after the sale is made you order with the manufacturer (or drop-shipper) and they ship the item directly to your customer. This could be your own private label product or a manufacturers however the principle is the same. You don’t see the product and you don’t hold inventory, all you do is make the sale, process the payment and then place the order with the manufacturer or drop shipper. That’s it. When done correctly its a fantastic way to make money and doesn’t involve a lot of the nuances existent in a ‘normal’ business.

One of the key features of drop shipping is that you need next to nothing to start out, especially in today’s online environment. Sites like eBay and other online marketplaces allow you to sell to thousands on potential buyers and the cost to set up is $0. Here is an example of how to do it using eBay as an example:

1. Sign up with Ebay – FREE
2. Get a Paypal account if you havn’t already got one for processing payments – (also FREE)
3. Check out eBay pulse – this will tell you what the current top searches on eBay are. This information will help you understand what is in high demand on eBay.
4. Once you are aware of what is selling, write a list down of these items and find out what people are willing to pay for them. A good way to do this is to check out other sellers in the category selling similar products and have a look at their feedback. Most of the time you can see what they sold previously and how much the item sold for. Use these sales as a guide to what the items will sell for. Write down a rough price range for each item to refer to in the next step.
5. For each item find the appropriate manufacturers and possible drop shipping companies where you can purchase the product and have it drop shipped. You can find manufacturers and drop shippers at the following places: Alibaba, Craigslist and DHgate.
6. Determine those products that you can make a profit from based on the amount they usually sell for (see step 4).
7. For the profitable products, put an advertisement up on eBay setting the minimum bid at what you need to break even or make a small profit.
8. Sell your products, take the money and then organise the shipment of the item
9. eBay will invoice you once a month (around mid-month) and will include submission fees (fee for placing an auction) and also their commission on the sales you make. Ensure you factor in these fees into your bidding reserve as they will eat into your revenue.

If you take the approach above you actually will never need to spend a cent of your money before you make money. Signing up to eBay is completely free and you will only pay the fees in bulk which most of the time is after you have sold your products so you have the money already. Once you have found the right product it is super easy to develop and automated sales process that can immediately send orders to your drop shipper as soon as your Paypal account has been credited.

You can also set up an online store selling drop shipped items. There are both positives and negatives in starting your own online store. The positives are mainly the fact you don’t need to pay insertion fees to a company like eBay and the commission fees are much much lower. Added to this with less competition (compared to eBay) you can charge a premium for your products. However the other side to this is that you need to find a way to drive traffic to your online store and your main options are paid advertising. These can be offline and online. You can use offline methods like print, flyers etc to drive traffic to your online store and also online traffic methods such as pay-per-click (PPC) advertising, banners ads or similar. Most of these cost money but probably not enough to turn you away from this path.

If you want to take the online store route then there are plenty of options where you can easily develop a great looking and functional e-commerce ready store. My favorite is Shopify and there is a Free Trial so you can test it out. It’s not expensive at about $24 per month for a normal sized business selling 100 units. This can be much cheaper than eBay if you get it working well. Essentially that means you can set up a free store (using the trial) and all you need to do is drive traffic to it, no inventory, no staff and no bulk orders. It shouldn’t take longer than 30 days to start making money from it so you already have money to pay their monthly fee starting from the second month. So in this example you have again effetively started with virtually no capital.

I have tried both of these and both of them worked well. I was able to charge more with my online store with Shopify however eBay sales came easier but much less profit.

Do dropshipping right and you to will realise just how little money you need to establish a great revenue stream.

This is the most important step you can take when starting out a business. You can do everything else brilliantly, come up with a multi million dollar idea and if you fail to do this step then it will amount to nothing. Once again to read about the first 3 steps (important!) you can do so by clicking here. This will take you to the category and you can browse through the other posts.

In today’s environment taking action has never been easier. There are a multitude of plug-ins, scripts, programs and programmers that make this step super cheap and super easy to do. All you need is the idea of what you want to do (which you already know from Steps 1 and 2 ) and Google. Get in there and go onto forums asking questions about your chosen business and ways you can make it happen. Don’t be afraid to talk about what your thinking of doing but obviously don’t give away the finer details. For example in my situation, I am looking at creating a mobile video site where you can search a massive database of videos and download them directly to your mobile. So I would go to a forum and ask them if anyone knows how to download movies to their mobile. Using this information you can gather further info then ask following questions until you have a better understanding of whats involved.

Once you have a great load of information, simply post your request to a programmer on either rentacoder or elance and see what they come back with. One thing to remember is that if your not a programmer, don’t think everything is difficult because it sounds difficult to you. If in your description you make out like its a big project which requires the uber brain to code, then programmers will treat it like that and you will pay a premium. On the other hand, if you have all the information you need, know what you want and write it with clear straight forward instructions then you will notice programmers will be much more honest. They immediately can tell what you will be like to work with and will tailor their pricing considering this. These guys are professionals (most are anyway!) and what you think is a big deal could probably be bread and butter easy for them and most often is. So just stay aware of that.

Ok, so what I have done is put up a bid request to see what I could get. It goes something like this:

I am looking at having a simple WAP (mobile) site created. Its for a hub where people can download videos onto their mobile/cell phone.

The design is quite simple, see attached file – (i’ve shown this below).

The site needs to be designed for mobile phone and support .php ads from google and admob.

I would like to be able to:

1. Ad Videos
2. Update the “featured videos”
3. Amend the position of ads
4. Ad and remove categories.

A content CMS would be required for this.

Coding has to be search engine friendly and clean.

The image I attached was this:

Mobile Video Site outline

What I need to do now is wait to see what comes back and if the programmers have any questions, which they usually do. What to get out of this is that I was very succinct yet quite open in what I wrote down. I used graphical representation so that they could even better understand what I was after. I strongly recommend this and it only takes a few minutes to do. Even something hand drawn would work great.

By understanding exactly what I require, programmers immediately associate me with less effort compared to someone who doesn’t really know what they want. This leads to more accurate and usually lower priced bids. Secondly because its not overly detailed it gives the programmer a bit of flexibility and the option to discuss better ways the site can be done. This is great especially if they are aware of plug-ins or scripts that can be integrated quickly and easily. This can result in the saving of costs associated with the project as well as improving project turn around times. So keep it succinct yet make sure you give the programmer a bit of flexibility, unless your determined and sure about what you want.

I’ll let you know how this goes when some feedback comes through!

For the majority of examples, entrepreneurs start a business to generate revenue and hopefully in turn, make a profit.

Before I go any further I want to clarify something. I have always found it perplexing the way people approach how they should be making a profit from their value offering. I’m not talking about the method in generating a profit, I’m referring to how they think about the term, ‘profit‘. People almost feel guilty if they have an aim of making a profit. Why would you feel guilty about this? There is no reason to feel ashamed of doing something to make a profit. If you provide a product which is of great value and set your price in a range where people can and will purchase it then its a win-win situation. First, you generate revenue and your buyer has purchased something that has a certain perceived value for something they were willing and able to purchase it. I don’t see why anyone should be ashamed of this? If you provide a sub-standard product and charge an exorbitant amount to people who don’t know better just to make a profit, then yes you should be ashamed.

Before you go on this post is continuing from my previous steps for starting up a business. Step 1 and Step 2. If you havn’t read these I strongly recommendyou do as you’ll be completely lost for the remainder of this post!

That aside, once I have thought of an idea with potential and then put down some points regarding the concept, my next step is to think of how I can make money out of offering this service. Well the first and most obvious answer would be to copy the Youtube example and place ads on the website which will earn me money whenever a site user clicks on them. That sounds pretty straight forward but people who are regulars to this blog know my thoughts on using advertising as the revenue model. In short, I’m not a big fan. After all, how many times have you clicked on a display or text ad on Youtube?

On the other hand, will people actually pay to use a video sharing service on their mobile when there are so many free options out there? No I don’t think they would to be honest. If I started charging for a service to stream videos onto mobile then wouldn’t my users start reverting back to using another mobile video streaming site? Most probably. I’ll think a little harder.

Ok so what do I do now. I know that Youtube is the giant and so far offers the best mobile video offering available. I also know Youtube only allows streaming to your mobile and the other download sites are not really anything special. So I’m thinking if I can offer the streaming service for free and support it by advertising I will keep and retain the casual visitors. On top of that if I can also offer a premium service for those wishing to download those videos onto their mobile then I would be able to charge for this as the current alternatives are pretty poor. This allows me to work with two revenue streams, the first being advertising for those casual streaming visitors and as well as a membership based premium service for those wanting to download the content to their mobile.

Ok so this is what I’m thinking:

1. Revenue model 1 – Free video streaming (will not include video downloads) will be supported by advertising. Advertising network options include: Adsense Mobile, Admob and Decktrade.
2. Revenue model 2 – Offer a premium paid service where users can stream videos as well as download any mobile video they like directly to their mobile. Premium members will pay a small monthly fee in order to use the download service.

I’m pretty happy with this as it offers both a streaming option which anyone can use and yet also tailors for users that want even more and wish to download any video directly to their mobile. To do this they will need to become site members and pay a relatively small ongoing membership fee. For me that means the highly trafficked free streaming section still generates a revenue but I can also offer great value and charge for membership which is a great form of recurring income.

I have a university degree in Business. The importance they placed on creating and defining a business plan was paramount. You need a business plan there are not two ways about it. It needs to have all the information including where your business will be located, what you will do, your revenue model, your sales forecasts, a SWOT analysis, a mission statement, first aid steps and a budget… among many other things. What complete rubbish.

I’m about to tell you this. If your interested in trying out a new business idea and decide to start by putting a business plan together then your a goose. When starting out a business plan is an acceptable form of procrastination. I will repeat that again and put it in bold and italics. A business plan is an acceptable form of procrastination. If you have a bright idea and want to get the ball rolling and you set off to write a business plan then all that is doing is stopping you from getting started. You may be thinking writing a business plan is getting started but I’m sorry, it’s not. Getting started is jotting a few points down and then doing it. Not thinking about it or writing about it but actually doing it.

Why skip the business plan? The first thing a business plan will do is make you reconsider your initial idea. You will come across hurdles and barriers that you didn’t think about before and slowly but surely you will be weened off the idea before you have even started. You might be thinking that this is a good thing right? This would mean that you have effectively saved yourself time and effort by finding out all the flaws in your idea before wasting your time, right? Wrong. What you have done is convinced your mind that the idea is not possible, nothing else. If you had actually started implementing your idea you would have come across these barriers regardless. In every business there will be barriers. The difference is that because you have started and are immersed in your project you will find away around these barriers. Thinking and pin-pointing these hurdles before hand will make starting less likely and therefore you will never find solutions to these problems.

Another problem is that a business plan actually complicates things. A business plan will flood further ideas into your mind and your fantastic small idea will turn into an overwhelming behemoth before you know it. You add more and more bells and whistles, change tact and thinking about more revenue models and target market opportunities. You no longer have a great simple idea but a complex global conglomerate before you have even started. This will again put you in an overwhelmed and less motivated mindset and cause you not to start. If you keep it extremely simple, then its very easy to get started and create your idea. Once this idea has been created you will then know where the other opportunities lie.

A business plan is effectively your mind trying to find a way to not get started. This could be due to a fear of failure, fear of the effort you need to put in or fear of not knowing how to get it done. It’s all a form of procrastination. What your doing is taking the relatively easy and non-confrontational option of working on your ‘business plan’. I am guilty of this, if I didn’t feel confident about getting started I just focused on my business plan. It’s like not wanting to make cold calls so you prepare emails instead. The problem here as I have mentioned before, is that the business plan is not just a time consuming procrastination but it will also give you more and more excuses why you shouldn’t go ahead with your idea. Very rarely does it motivate you even more to pursue your idea, your motivation is already existent pre-business plan and all your doing is finding a sure fire way to destroy that motivation. This is the worst type of procrastination, let alone a productive, business enhancing task!

Nothing is ever constant especially in the current business world. Your business plan and direction will continually adapt to internal as well as external forces. Businesses today need to be extremely flexible with the ability to adapt quickly to change. After creating a plan for your business, you will certainly find that what ends up working in the real world is entirely different to what you had in your plan. Sure a business plan is adaptive in itself but why start with one? Why not do your idea, learn from it then find out the best way to move forward. Not the other way, that would be a complete and utter waste of time. When you get an allergy test does the doctor give you a plan of what you may be allergic to because others are allergic to it then move you on your merry way? No. The doctor tests you for each individual allergy by giving you a bit of the cause and watches for a reaction. Only then does she form an outline of what you are allergic to. Why doesn’t your business idea need testing then?

Am I saying never to do a business plan at all? No, I think a business plan is great, but not for when your starting out. I am going against everything I have been taught and the reason for this is that I am basing it on experience. A business plan should be implemented after you have gone out and tried your new idea, not before. Today, things are so much cheaper to create compared to what it once was so there is absolutely no excuse to have an idea and not put it into action. To be fair this wasn’t the case 10, maybe even 5 years ago, so what we are taught in schools, colleges and universities are defunct only a few years later. Now it is essential you go out and create your idea, only then will you be in a position to determine what you should include in your business plan.

A business plan can also be effective when you are working with a group of people. A basic plan will help put all the ideas down on paper so you have a chief aim and defined objectives to work towards. Even then, the plan should really only be a couple of pages long, if that at all. It needs to be just enough to point out the main details and get everyone thinking along the same path. This is not really a business plan but a basic business outline, leave the plans for later.

What about for investment? Don’t you need a plan? Yes of course you do, but you also need something to show for your idea. Most investors and venture capitalists want to see something in action before they decide to invest. So do something first, then plan out after.

A proper business plan takes times and effort. This is time where you could be putting things into action. This is the time when your at your most motivated and excited yet you will be putting it to waste. This is the time that will enable other people to leap frog you and get a started on your idea. This is the time when you could lose your first mover advantage. With the endless number of plug-ins and software on offer as well as the ability to easily and safely outsource the creation of your concept, the only person you have to blame for not getting started is yourself. Stop using your business plan as your excuse.