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Thread: Starting your own online business Stage 1

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    Platinum Member Chatmaster's Avatar
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    Starting your own online business Stage 1

    Planned content for this tutorial will include:



    Stage 1

    What makes the Internet such a good platform for online business

    This is a topic that a complete set of books can be written about, but I am going to do this as simple as possible. It is however very important as it explains to any person starting out simple rules that do not apply to the Internet game.

    Low risk = High return

    The Internet is a complete contradiction to what you will hear many economists and business leaders tell you. The generalization that High Risk equals high return does NOT apply to the Internet. Although never said, this is one of the reasons the dotcom bubble burst. Anyway lets look at the reasons the Internet is an ideal platform for any entrepreneur.

    Less financial risks

    If you start out a business in a landbased environment you often need money and in many cases you need lots of it. You need to purchase stock, in some cases you might even need to rent office or shop space. In most cases people would then go to a bank or financial institution to borrow the money.

    One thing that financial institutions do is they ask you to hand in a business plan. You can go to most of their websites and even download a template of a business plan. This business plan is a simple thumb suck of how your dreams would become a reality, but to the bank it is a document that proofs to them that you have done some planning before you start your business. Now I need to highlight something very important here.

    A business plan as they see it, is in 95% of the cases a meaningless document that simply put your dreams down on paper. They essentially don’t care that much about it because their risks are mainly covered by the security you provide them with for the loan. This means that no matter what the outcome is of your business they still have your assets to sell if they do not get their money back.

    Do not make yourself believe for one second that they carry large risks, essentially in this case you as the borrower is the one that carries the risk of losing your home, property and assets not the bank or financial institution.

    How does this compare to the Internet. The Internet requires very little start-up costs. You do not need to have any stock, nor do you need any office or furniture or anything that are expensive. In many cases your risks involves things that you already pay for, internet and a computer. The only additional money that you need to part with is at most about $10 a month for hosting and a domain.

    Do you need to resign to start your own Internet business? No, you need to dedicate at least an hour or 2 each day and you are able to manage your own time as you go on. Is it wise to resign? It is never wise to increase risk, so the secret of internet entrepreneurship is to lower your risks as far as possible, keep your job!

    Marketing

    In terms of marketing, the land based environment has always required lots of money in order to get your business exposure. Advertising avenues like printed media, radio, television and other like advertising boards and flyers can cost a lot of money and results are never guaranteed. This is increased risk that doesn’t form part of the Internet business.

    If you look at the biggest advertising platform of all, television you are looking at the biggest TV station in South Africa which is SABC 1. Then you look at reaching about 18 million people on a weekly basis. The actual of this figure is highly debatable though as it is an estimate and cannot be counted. A further challenge that you will have is the demographics of the viewers of this channel. Although they will make certain claims about the demographics it is highly debatable on how accurate this is. Costs to advertise will run in their millions as you would look at about R100k per advert and then it excludes the cost of producing the advert.

    The Internet however has accurate statistics. It is very cheap and affordable marketing avenues. It has the power to explode your business, and a quarter of the world’s population has access to you. All you need to do is create the roads to your business and the traffic will start coming.

    Essentially the entire idea of Stage 1 is to make you understand that the Internet offers massive value as a platform, but very little risk. The little risk is however very important to remember throughout every decision you make in future.
    Last edited by Chatmaster; 22-Feb-10 at 08:03 PM. Reason: building link consistency

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    wynn (13-Nov-09)

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    Platinum Member SilverNodashi's Avatar
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    Hi Roelof,

    Thanx for sharing this with us. I do want to add a few points though, if I may.


    $10 pm equated to about R70 - R80pm, which is a lot for a web hosting account. R80pm over 12 months = R960. Add to that R100 - R400 (yes, I've seen this many times) for domain registration, and you quickly have a small fortune to pay every year.

    There are cheaper options available, and start-up companies should definately look into this.

    And then you still need to market & "sell" your website. Having a website doesn't mean it will flourish over-night. Do your homework, and look for creative ways to advertise your website for free. Tell everyone you know about it, and ask them to tell their friends. Word of mouth advertising is free and very very effective.
    Get superfast South African Hosting at WebHostingZone

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    Platinum Member Chatmaster's Avatar
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    Quote Originally Posted by SoftDux View Post
    Add to that R100 - R400 (yes, I've seen this many times)
    It sounds like you are familiar with Speednames.com

    What do you think of Yola.com?

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    Diamond Member wynn's Avatar
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    Roelof, won't you number the threads please? I get confused if I come back to the forum after a few busy days and can't remember if I have read them or not.
    "Nobody who has succeeded has not failed along the way"
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    Chatmaster (13-Nov-09)

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    Platinum Member Chatmaster's Avatar
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    Thanks wynn, good point!

    I have done it with my next one I just posted, I don't think I am able to change the Titles of the existing ones though.

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    Email problem MichaelB's Avatar
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    Thanks Roelof

    This is going to be valuable information for those new (& perhaps not so new) to internet marketing. I'm sure this series will clarify a lot of points that have been bugging SA internet marketers for years, eg Do we use an international service provider like GoDaddy to buy & host a domain, or are there viable alternatives in SA?

    I'm sure there are a ton of other questions that you will be answering in the future. Thanks for the good work.

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    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by Chatmaster View Post
    Thanks wynn, good point!

    I have done it with my next one I just posted, I don't think I am able to change the Titles of the existing ones though.
    Thread tools > edit thread

    Good thing you've got moderator powers
    The trouble with opportunity is it normally comes dressed up as work.

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    Platinum Member Chatmaster's Avatar
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    Quote Originally Posted by MichaelB View Post
    This is going to be valuable information for those new (& perhaps not so new) to internet marketing.
    I am sure there we will gain some insights from others as well (I am hoping for it anyway) so that we can all learn more.

    Quote Originally Posted by MichaelB View Post
    Thanks for the good work.
    Thanks MichaelB

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    Platinum Member Chatmaster's Avatar
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    Quote Originally Posted by Dave A View Post
    Thread tools > edit thread

    Good thing you've got moderator powers

    Thanks Dave!

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