Your Type of Online Business: A Guide to Setting it Up

Your guide to setting up the right type of online business for you from selecting the right online business model to audience identification and platform selection.

set up a type of online business

Photo by Daria Nepriakhina


Table of Contents:

“Your Guide to Choosing the Right Type of Online Business for Success”

Intro: Most Popular Online Business Models

Step 1: Decide on The Right Platform

Step 2: Start Business Planning

Step 3: Validate Your Idea

Step 4: Set Up Your Website

Step 5: Make It Legal

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If you are ready to take responsibility for your destiny, but you don’t have the capital to buy a franchise or open a shop, think about starting an online business.

Managing an online business certainly has its appeal. However, it has its own set of challenges. The truth is, starting a business of any kind is hard work.


“Online” is just a channel that connects businesses with people. It’s a powerful tool that lets you connect with anyone from anywhere in the world. However, like any business, you still need to secure the right customers with the right offers.


There’s not one simple trick when it comes to selecting the right type of online business you should begin. Online business can certainly be an effective revenue model and to help you find a product idea or business model that fits your lifestyle, we have put together a collection of simple ways to start a business without quitting your day job.

This handy guide should put you on the right path to uncovering the type of online business that is most suitable for you as well as how to set it up for success.

Let’s get started!

Most Popular Online Business Models

We’ve come a long way since Amazon sold its first book online in 1995. If you have thought about starting an online business, many opportunities use different business models, such as:


  • Software as a Service (SaaS), as QuickBooks Online
  • Online clothing store as
  • Blue Apron Signature Boxes
  • Online consulting and freelance services such as Fiverr and Upwork
  • E-commerce platforms such as eBay or Amazon
  • Cargo transportation companies, such as multilevel distributors.
  • Handicraft markets such as Etsy
  • Rental services like Airbnb

Step 1: Decide on The Right Platform

An e-commerce site is the most direct type of online business that you can start, compared to a business that uses a third-party platform or a marketplace such as Etsy, eBay, Amazon, or Airbnb.


When you create your e-commerce site, you will sell your products and services directly to your customers without “crossroads.”

Hosting your site

The best thing about the right e-commerce site is the level of control over your store. You can customize almost every aspect of your e-commerce site, including the look and feel of your store. However, this flexibility can also make it more challenging to get started.


Focus on the user experience. Your biggest consideration when working with an e-commerce site is to customize your site to offer a better user experience. Choosing the right web design is critical, as well as ensuring that your shopping cart software is right for your business. Be sure to familiarize yourself with the different shopping cart options available – from Shopify to X-Cart, and many others.


Do you need to create your shopping cart from scratch? Keep in mind that depending on your specific business, it may be necessary, or not, to build (or pay someone to build) the site from scratch.


However, if you have always been passionate about programming, make use of your programming skills; or start learning some Java or JavaScript :)

Using a Marketplace

Depending on your product or service, more and more third-party stores such as eBay, Etsy, Amazon, and even Airbnb or Fiverr appear in the e-commerce market.


Building a business with one of these e-commerce sites can be easier because you’ll have to make fewer decisions, and you won’t have to create your own website – you’ll use an existing template.


However, one way or another, you will end up paying for a third-party platform. Some sites charge a fee based on the number of product announcements you make each month, while others, such as Airbnb, charge a service fee when a reservation is accepted.

Consider all the pros and cons

The fact that your customers will have to visit a third party to buy from you has its advantages and disadvantages. If you are interested in renting out your vacation property, using the Airbnb platform means that it is likely to be easier for someone to find you when they are looking for accommodation in your area, due to the growing popularity of Airbnb.


However, consumers also find it easier to compare similar products, making your ability to differentiate yourself more important. For example, if you decide to use Etsy to sell handmade cutting boards, when a potential buyer is looking for cutting boards on a site, they will be scouting through potentially hundreds or thousands of relatively similar ads.

Focus on What Sets You Apart

If you use an e-commerce market, pay special attention to the quality of the images you use on your page. Good product photos can make your ad stand out. However, remember that using an e-commerce site is also not a free pass to use mediocre images. In any case, customers will rely on images to form an opinion about the value of your product or service.

Choose the Right Platform

Have you ever tried selling the most refined oil painting for $10,000 at the farmer’s market? It’s not entirely impossible, but it’s quite rare. Make sure the market you are looking for attracts people from your target demographic.


Also, keep in mind that there is really no platform that works for every type of business. Take the time to research the best one for you. If you are selling art or crafts, look for a platform that is used by other artists.


If you are selling used comics, look for a platform that attracts many buyers who want to buy used comics.


Make sure you also read the fine print. Almost every platform has its list of banned items.

Step 2: Start Business Planning

Your Type of Online Business- A Guide to Setting it Up

Photo by Daria Nepriakhina


Business planning should be something that you do regularly from the start, not something you do once off in the early stages of your startup.

Lean Planning

Start with the Lean Business Plan, something you can do in 30 minutes instead of six weeks. The Lean Business Plan is faster and easier to write and takes your plan to the level you need.


You might be interested in: Tips to Market Your Business on a Budget from Industry Experts

Figure Out If There’s a Market For Your Ideas

Pay special attention to your market analysis and SWOT analysis to confirm that there is a market for your product and that you have identified a competitor.

Think about Funding and Metrics

Take some time to determine the cost of the startup and think about how you plan to finance your business. Even if your online business is just an extra, for now, do yourself a favor and think about the business and sales figures that you should track to make sure you’re moving in the right direction.


Review these metrics regularly by comparing what you predicted with your actual sales. You can do this with a spreadsheet set. However, the business dashboard can help you stay on top of your finances. If you’re using a system like QuickBooks, you can automatically retract financial information, so you don’t have to add it manually.

Step 3: Validate Your Idea

According to the lean startup methodology, you will want to create a minimum viable product or MVP, and use it to test your idea.


The common mistake that many people make when it comes to testing their business idea is that they think they will have to invest hundreds or thousands of dollars in MVP development. In fact, at this stage, you want to spend very little.


Whatever your idea of an MVP is, it can be more on the minimum side, and can often be covered by the money you have in your pocket.


The two most cost-effective methods of testing, which also prove to be the most effective, are either building a website or making a café test.


For the latter, simply head to your local café, set up a small sign saying that in exchange for coffee, all you need is 10 minutes of someone’s time, and spend the whole day talking to people.


All you need is a few conceptual photos, even a simple slideshow, and then talk to as many people as you would like, in order to gather valuable information.


You can find out what they like about your product, what they don’t like, what they will pay for it, and tons of other interesting information. This is an insanely cheap and straightforward way to test your idea.


Now let’s discuss website creation to confirm your idea.

Step 4: Set Up Your Website

Decide on a Name

The decision on your trade name and the registration of the domain name must be made simultaneously. The last thing you want to know is that your desired domain (the domain that you have bought or the name that you have chosen) is registered with some other business.


When it comes to online business, there are apparent advantages to registering a domain name that matches your company or product name. You want to make it as easy as possible for people to find you when they look for you online. The same is true of what you call your storefront if you use an online platform such as Etsy or eBay.


You might be interested: Brand Design Strategy & Brand Design Marketing Agency

Build Up Your Site

Build Up Your Site

Check out Dribbble for inspiration


In some cases, it certainly makes sense to create your own website. If you are building a real online product as a SaaS product, your team probably already has the skills needed to build your marketing website.


If you’re just using the Internet as a platform to sell something analogous (such as clothing or a food subscription box), a service like consulting, design services, or even vacation rentals, you can take more advantage of your existing platform. You can also make use of the existing e-commerce template options, so you don’t need to start from scratch.


Hiring a web design firm is always an option. Either way, remember that it’s never a bad idea to build a minimum viable product (MVP) site to begin with. Meaning, you do not need to build a 100% ideal site right away. Test your hypothesis that your product or service is marketable by using a cheaper and simpler option first.


By the way, I recommend starting with wireframes; here is a good selection of free wireframe tools.

Make it Mobile-friendly

No matter how you choose to create your presence on the Internet, do not miss the opportunity to make it mobile-friendly.


If your website is not optimized for mobile devices, your users will have a less positive experience when they try to find you from their phones. In addition, Google will also punish you in search results, meaning you will be harder for new customers to find.

Think About Blogging

Content marketing (blog) may or may not be part of your original marketing plan. The critical point here is to keep it optional. If you are building your site from scratch or using an e-commerce template through Squarespace or somewhere else, make sure that you are building your site in such a way that adding a blog will not require a significant change.

Consider Monetization and Attract People

Social Media Marketing

No matter what type of online business you decide to work in, you will have to learn how to use social media as part of marketing. Whether it’s LinkedIn, Facebook, or Instagram, you need to know how to use at least one of these platforms.


In general, the rules for promoting social media on different platforms are similar. You need to be sure that you’re posting quality content and that you’re posting it consistently. How you define quality content depends on your audience and what they find valuable.


The second part of the equation is consistency because, without consistency, you cannot build a strong social network that follows you.


While you can post messages manually to your preferred social networking platform, this can eventually take up a lot of time.


Use some kind of social networking planning tool. There are many great services that you can use once your brand is more resilient, and you can afford access to features such as built-in analytics, multi-channel management, and channel trackers.

Pay-per-click Marketing (PPC)

In the PPC campaign, the search engine you choose ensures that a link to your site appears at the top of the results page when a user searches for a specific keyword.

In return, you will pay a search engine fee every time a user clicks on your link.


One of the most famous PPC systems is Google Ads, through which businesses can appear as “promotional” links at the top of a Google results page.


A PPC campaign can be a quick way to get people to your site, but it’s up to you to decide if you pay for every click of the results you get.


Remember that the more successful your campaign is and the more useful your target page is, the better results you get – and the less Google will charge you for each click.


It is considered good practice to send regular marketing emails (e.g., email newsletters) to your customers to keep them informed about news and special offers of your brand.


Collect email addresses for your mailing list by adding a registration form to your site and sharing it with your followers on social media.


When you request email addresses for your mailing list, make sure they meet GDPR standards.


Be sure to check out: Essentials of Effective Marketing Collateral – Start Yours Today.

Partner Marketing

With affiliate programs, you advertise your business, whether it’s advertising, hyperlinks in articles, or on other relevant websites (known as your partners) for free.


If a client clicks on this advertising and goes to your site and then makes a purchase, you pay a commission to the affiliate site where the client moved from.

Step 5: Make It Legal

Photo by Kelly Sikkema


There are a few steps you need to make to ensure that your business is legal. Although, in general, the same rules apply to online businesses as they do to regular businesses, there are some subtle differences.


The most significant difference when it comes to doing business online, compared to regular business, is the law on the Internet business. These laws deal with the distribution of customer personal information, as well as other provisions on privacy and intellectual property. SBA provides a detailed overview of the specifics of Internet Business Laws. Make sure you are familiar with them before starting your online business.


Decide how you want to establish your company’s legal structure. Many companies prefer to set up an LLC. However, do your research to find out which one is best for you. The requirements will naturally vary from state to state. Visit your local state office secretary’s website for more information on state compliance.

What’s Next?

Now we’ve looked at the steps you need to find and start the right type of online business for you, it’s time to get to the heart of the matter and start building your website.


Create your own online business in your spare time. Start small with a little side hustle and scale from there. The beauty of opening your own online business is that it’s up to you what you want to do and how you want to do it.