The 3 Main Components of a Virtual Business
Updated on February 29, 2020
Maybe you checked out The 4-Hour Work Week and idolize Tim Ferriss.
Perhaps you devoured $100 Startup and think Chris Guillebeau is the bomb.com.
It’s possible you’re already a Location Rebel with Sean Ogle or member of Tropical MBA’s Dynamite Circle.
Or, you could have no idea what I’m talking about, and want me to get to the point already.
The people listed above –– and countless others I didn’t mention –– are all part of the growing trend in online entrepreneurship. With the allure of a passive income, mixed with location independence and autonomy (all with a low barrier to entry) it’s no wonder that virtual businesses are having their day in the sun.
With rising demand of interested would-be entrepreneurs, the supply of digital gurus seeking to walk newbies through this process has gone up as well.
Each one seems to have their own special recipe to online business success, and most offer scads of free and paid resources to their audiences that teach them how to become a successful entrepreneur.
However, while much of this space focuses on teaching first-time business owners, many of the lessons can serve veteran business owners as well. Those moving from a traditional brick-and-mortar business to an online one will need to learn different strategies and methods for success.
As with any business, there are indeed plenty of ways to attack the online beast, depending on your niche interest, profit model, and level of time and energy investment.
However, there are 3 key components of online business that pretty much stay the same –– no matter what type of online business you end up running.
Before you sink your teeth into the meatier game plans, take a look at the core building blocks to creating a virtual business, to ensure that yours will be a success from Day 1.
1. Who Cares? Build Traffic
One of the biggest requirements for the success of any online business is that people give a shit.
Just as the key to weight loss is seemingly simple (fewer calories in than calories out), so is the formula for online business success (increased clicks and views lead to increased purchases).
Shockingly, more clicks require more humans on your site (or in your store).
To accomplish that goal, let’s quickly break down how you find a topic that interests both you and the wider world around you, so you can develop a viable concept for your business.
How to Find Your Idea
If you’re reading this, you may already have an idea for an online business, in which case, use this section confirm your idea’s potential for success.
If not, start by thinking about your interests. To build an online business, it really helps to be at least a little interested in the topic you’re building your site around. Picking a lackluster topic will almost guarantee that you derail early on and waste a lot of time.
Make a list of your hobbies, scan your bookshelf for common themes, ask your friends what they think you’re good at, or look for patterns in your website bookmarks.
Once you have a good list, narrow it down to the two or three that you feel most excited about.
Then, test your idea with the following questions (this might require a little research):
- Do I know a lot about this idea or feel passionate/interested enough to learn more about it?
- Are other people out there already working in this area / are people paying for information on it? (Competition is actually a good thing — it means there’s money out there!)
- Can I do something different or better than the existing competition?
- Is my topic too broad (reviews of TV shows) or too narrow (analyses of the characters in Lost)?
Try to find the happy medium between general and specific, and make sure that the topic is not time sensitive or temporary (or be prepared to ride the wave and crash hard).
For example, if you’re obsessed with Lost fan fiction, you might create some pretty interesting theories about John Locke’s wheelchair symbolism; but considering the show ended nearly a decade ago, your audience will likely be much smaller than if you focused on something people are still interested in and want to consume content on.
Starting here can help you do your due diligence that your idea is sustainable, based on your own preferences, and confirm market interest in your topic.
Build Your Traffic Funnels
Once you have a viable idea, take the hour to hop on WordPress, or a similar platform, and create your site. It’s much easier to build the rest of the following components in if you have a functioning main site you’re directing people to.
Even if you are ultimately planning to build your business from another medium, such as a podcast or YouTube channel, you should still have a site.
Think of your project like a wheel, with your website as the hub, and all other aspects of your business as spokes that lead customers and audience back to the main part.
Now you can start planning how you will bring interested eyeballs to the business.
If you haven’t heard this already, take note: the number one way to land and keep people on your website is simple: make good content. You could have all the bells and whistles of a fancy pants site, but if your content and copy are crap, people will not come back — guaranteed.
Apart from this main strategy, there are dozens if not hundreds of different tactics to garner people’s attention, and most online businesses use some combination of a few to maximize their reach and potential client base.
Research your options and select a primary and secondary method (for now) to focus your attention. Here are a few popular ones:
Social Media
What it is:
It’s becoming tougher to define these days, as many companies are integrating social components into their sites in some form or another.
But as of this writing, the social media heavyweights are Facebook, Instagram, Pinterest, Snapchat, and Twitter.
How to do it:
This is going to depend a lot on your audience and their social media habits, or lack thereof.
Do some research into the demographics of your target audience to see which social media platform will be the most productive. Invest your time (and potentially resources, in the form of a contractor or consultant/course) in a couple that are the most likely to drive people to your content. And learn how to do them well.
Paid Advertising
What it is:
Paying out some of your hard-earned dollar dollar bills in the name of raising brand recognition and driving those almighty clicks to your site.
How to do it:
There are lots of ways to advertise. These days, many online businesses use Google AdWords to get ads out on other sites and in Google searches. There’s also Facebook Ads, private banner ads, sponsored Tweets & Instagram posts…the list goes on. Similar to social media, make sure you know where your customers are and invest money there.
Guest Posting
What it is:
Just what it sounds like. Write a post that will be featured on a friendly fellow online business owner’s site. Link to your site and bring home the click.
How to do it:
Follow, comment, and generally get involved with other bloggers and sites whose audience would also be interested in your content. Write them a nice email talking about how useful their content is to you, and how you could help them fill a gap in their work with some ideas about what kind of posts you could write. Do your homework here, and don’t get upset if you get rejected your first few (or several) tries.
SEO
What it is:
This is the magic sauce that gets people high rates of organic search traffic. If done well, SEO optimizes your content so that when people go searching for keywords that relate to your site, they find you!
How to do it:
Depending on what platform you use for your website, you probably have a plugin or add-on available that can help you make sure that your SEO rating is high. If you use WordPress, search for Yoast. Many, many, SEO resources exist out there.
2. Who Will Pay Me and How? Monetize Your Site
Now you’ve got people reading, clicking, and generally enjoying your site and content.
All is well, except… wasn’t this supposed to be making you money?
Building out a monetization strategy is the next to key to planning your virtual business. With the confirmation that yes, indeed, people care about what you’re doing, you can pivot your work towards your end goal: the bacon ($).
There’s a bit of debate here about which comes first — the traffic or the monetization and plan. In our experience, it is way more helpful to find out if people are interested in what you’re doing than to slap a Buy Now button on a website and then wonder why it isn’t working. Sure, there are the outliers that are able to get conversions on an idea that happens to be a hit, but those are not the norm.
Before you sink money into products or course creation or other revenue sources, make sure people want to be there in the first place. Try creating a most basic prototype of your idea and send it out into the world before it’s polished. Then you can get real, user-based feedback on your idea that can help you better plan and create the real deal.
As your Google Analytics start to spike in the upward direction, you should be considering different ways that you can monetize your work. Again, there are tons of options to choose from or create, and your decisions will depend a lot on who your audience is, but we’ve compiled a few of the most popular options here:
Sell Your Own Products and Services
What it is:
As you develop your site’s content, you may discover that all of the things you are producing could be repackaged into an ebook, course, or other product or service you could sell to potential clients.
How to do it:
Look through the content you have created, or aim to create some new content that could be compiled into an product or service that you could sell on your site. Connect with your PayPal, Stripe, or other payment processing account, then turn your attention towards pushing out the content through marketing.
Email Marketing
What it is:
Building a list of followers’ email addresses so you can form a relationship with them and ultimately pitch them the products and services you created.
How to do it:
Capture emails from Day 1 of your site’s publication. Use a simple email capture tool so that people can easily subscribe. You can enlist a service such as MailChimp, Drip, or ConvertKit to manage your emails more effectively.
Affiliate Marketing and Niche Ads
What it is:
Writing about products and services on your site, using special links that connect to your affiliate marketing account or service. When someone clicks on and buys a product you wrote about, you will get a percentage-based commission.
How to do it:
Sign up for the affiliate marketing programs in companies with related products and services to your blog. Many people do Amazon Associates because, well, Amazon sells everything. If you’re not sure, make a list of some brands or companies you see yourself writing about, and Google: “their name+“affiliate marketing program”” to find options.
Advertising and Sponsorships
What it is:
Remember how earlier we were talking about advertising your site on other online spaces? Well, you can also do it in reverse. By selling space on your website, media channels, or other channels, you can make extra bucks from your creation. You might also consider charging for sponsorships on videos or podcasts, so that other companies can pay for a certain post or episode to be “brought to you by” them.
How to do it:
You can use a service like Google Ads, or sell ads and/or sponsorships directly to potential clients. For sponsorships, reach out personally to connected and potentially interested businesses and corporations; these sources of income are usually more relationship driven.
3. Who Will Work For Me? Form a Location Independent Team
By this point, you should have a functional site with great content that’s pulling in cash through multiple revenue streams, based on your thriving traffic and clicks. (Don’t worry if it takes a while to build up to this point. Good stuff takes time.)
Depending on the type of company you have, you may find that you are handling every aspect of your business alone, and need help STAT.
Typically, online companies committed to sustainable growth must eventually hire employees and contractors that can help expand the business’ reach.
While it is certainly possible to hire or contract someone local, building a location independent team can be a great option if you’re not interested in having a brick-and-mortar location for your business.
Here are a few examples of the types of employees or contractors that you might bring on board to help with your day-to-day operations:
Content Creator
If your particular voice and commentary is not integral to the business, you can enlist the help of another person who can regularly write posts, make videos, record podcast episodes, or otherwise create content for your site.
Social Media Manager
This person will be in charge of pushing out all your content and conversations on the various platforms you wish to be a part of. If a big chunk of your audience comes from social media, this will be an important role that will need to be filled by a skilled person.
Virtual Assistant
If minutiae is getting in the way of you getting things done, maybe it is time to find someone who can take care of things like scheduling appointments, sifting through customer service emails, and other tasks that you do not necessarily need to do personally.
Financial Consultant/Accountant/Bookkeeper
Maybe you’re a Quickbooks whiz, or maybe you would like someone else to handle to dollars and sense. As your business grows, it might get a little overwhelming to handle all the financial details of the company, and another set of highly trained eyes doesn’t hurt.
Web Programmer
At some point, you may want to upgrade from a drag-and-drop site or template to something a little more advanced. This may require outsourcing the work to a programmer or developer who can come to the rescue when you want updates or glitches occur.
Designer
Whether it’s for promotional materials, your website, your logo, or other branding elements of your company, professionally created artwork becomes a must to separate yourself from the pack. People can tell if you actually know what you’re doing, or just threw something together in PhotoShop.
There are many places to get these mystical virtual employees. If you’re striking out with word of mouth references, you can often find great people on websites such as Upwork or Fiverr. Or take a look at some of our successes with apprenticeships and asking our audiences and networks for qualified candidates.
It’s Time to Assemble
Now that you are familiar with the three main components of a virtual business, it’s time to put everything together.
Start at the top, and determine a great niche idea that you and many others are interested in. From there, figure out how you will get these people to come take a look at what you’ve got going on, starting by creating great content and moving to traffic sources.
You may end up relying on a combination of strategies, from social media and advertising to guest posting and SEO to make this happen.
Once your audience is engaged, it’s time to up the ante by monetizing your site. Figure out the best way to turn your content into a profit machine, whether that’s through selling your own products and services, email and affiliate marketing, or selling advertising and sponsorship space.
As the business picks up steam, you may discover that you simply don’t have enough time to handle all of the pieces to your business’ puzzle. To combat feeling overwhelmed, you can hire out new team members, which may include a social media manager, content creator, virtual assistant, financial consultant, web programmer, or designer to help lighten the load.
Did you think it would be this much work?
If starting your own online business still sounds pretty kickass even with all that work, you’re probably the right kind of person to tackle the challenge.
So roll up your sleeves, set a picture of your entrepreneurial hero as your desktop background, and get to it.
Photo credit: Gajus-Images