Selling online: 9 things to consider before you start
Looking to start an online store but you don’t know how you should approach your product search? With a plethora of products available to sell, you may feel a little overwhelmed as to which product is the right one for you. To help you in the process, we’ve rounded up a list of criteria against which you could evaluate your product ideas. Let’s go!
1. Target customer
To build a solid foundation for your online store, you must start with identifying your typical customer. Many make the mistake of addressing too broad or too narrow audiences. An example of targeting that is too general is when your product caters to groups such as homeowners or freelancers. On the other hand, if plan to reach out to first-time mums between 25-35 who like heavy metal music, you may be too narrow in your search. An example of targeting done the right way would be aiming at homeowners at the age 35-55 with incomes of €200,000 in Berlin.
2. Market size
Make sure that you pick a product that has a small but sufficient number of recipients. With too small market size, the costs of acquiring a customer are substantially higher. And that will make your sales suffer.
At this point, you may also pay attention to your customers’ purchasing capabilities. If your product is suited for teenagers, you should remember that they are not eligible to buy with a credit card yet.
3. Fad, trend or a growing market?
Knowing the difference between these three is key to selling your online products successfully. The worst thing you can do is to spend your money to serve a fad like seasonal frozen yoghurt store only to watch it die almost as soon as it emerged. Provided that your product falls into a trend or growing market category, e.g. digital games or drones, you are on the safe side.
To help you specify where your product stands, try answering these questions:
Is the interest for my product likely to grow and sustain over time?
Is it based on societal or technological advancement?
Is the product based on novelty?
If you are just starting out as an e-commerce seller, it may be wise to check the competition around your “powerseller”. Does your product have many, a few or almost no competitors? Remember that even as a newcomer you can get the upper hand over giant retailers with strong customer care and thoughtful marketing strategy.
5. Selling price
Now, it’s time for setting the price of your product. An ideal price point ranges from €85 to €170 as you don’t need a large number of customers to make a decent profit. Additionally, you will have some additional money to spend on marketing campaigns. Anything lower than €80 won’t give you that much volume to sell profitably.
6. Profit margin
You can benefit from our bundles in multiple ways. First, you keep more money in your pocket – bundled games always come at a lower price than the same games bought separately. Second, with one click you get a few games – that’s a real time-saver. Last, but not least, you expand your store’s offering with an entirely new product.
7. Product quality
Is the product of such a quality that you would give it as a present to your closest friend? If not, you’d better keep on searching for another one. Nothing is more troublesome for a rising entrepreneur than a harmed reputation right from the start.
8. Digital or physical products?
Most starting entrepreneurs encounter this dilemma: Should I sell digital goods or physical goods? For starters, digital products may be a better option with its infinite stocks, free delivery, immediate access to a product and low setup time. You will find some worthwhile digital product ideas in the next article.
9. Solving a pain or serving a passion?
Products that are easy to sell online usually serve a pain or a passion. Take, for example, a smoke detector that removes the danger of toxic carbon gases or a recently released video game, a guilty pleasure that many gamers happily indulge in. How about your product? Does it solve a problem or entertain?
The product you pick to sell is at the very core of your e-commerce business and will determine your future sales. That’s why it’s essential that you go through all the factors provided to generate a healthy list of potential products to sell. In the next article, we’re going to share some interesting product ideas for your online business.
About the author
- E-commerce owner and blogger. A trained accountant and an avid gamer. Healthy food aficionado.
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