The Top 5 Money Reasons to Buy An Online Business
Online businesses are great financial assets to own. Because they’re digital, you can run them from anywhere in the world or you can have employees from any country running the business for you.
When built well, they can also be almost-passive sources of income. And, because of their simplicity and the abundance of learning resources available online, anyone without experience running a business can be successful with one.
In your past experiences in the working world, you’ll have built transferable skills and knowledge you can use to successfully run a business. In fact, if you’re an expert in a particular field, then you can come in with an advantage over other businesses run by entrepreneurs without that expert knowledge.
Online businesses are accessible and they’re highly profitable; there are numerous money reasons to acquire one.
In this article, we’re going to explore the top five money reasons to buy an online business so you can understand how they can generate a full-time or side income for you to secure your financial future.
1. Earn 100% Profit From Day One
When you acquire an online business you take over the whole asset, so you earn 100% of its profits from day one. This is different from other assets like stocks where you only earn a percentage of the company’s total earnings on a quarterly basis.
Buying an online business is also a much better financial strategy than building one from scratch where you can spend one year plus not earning a penny, or even losing money if you build an ecommerce business that requires expensive inventory.
A profit-generating business can sustain your lifestyle. This is why an online business can replace your day job, whereas if you purchase stocks or shares in real estate, the dividends only return in small amounts every quarter or you may only make your profit when you sell the asset.
Having profit coming in from day one allows you to continue to pay your bills while you’re running the business almost passively.
If you decide to keep your job while you have your online business, you can use its profits to reinvest into other smaller assets like online businesses or alternative investments.
With the profits your new business is generating, you can instantly invest in its growth.
2. Fast Return On Your Investment
Online businesses come with numerous fast return on investment (ROI) opportunities.
This is partly because all of their developments can be made online. For example, if you had a physical store and you wanted to change its layout with a refurbishment, you’d have to hire contractors to come in and assess the site, get planning permission for the work, and close the store while construction was ongoing.
All of these operations are highly disruptive to physical businesses, whereas online businesses can be upgraded in a matter of days or even hours.
Some of the key fast-ROI opportunities are as follows.
A key performance indicator for an online business is the percentage of site visitors who convert into customers, also known as the conversion rate.
A website’s design has the biggest impact on conversion rate; it influences what visitors think about the business, how well they’re able to find products and information, and how easily they can make purchases, among other factors that make up the whole customer experience.
Some of the design elements that influence conversion rate include:
- Call to action buttons (CTA’s)
- Website copy
- Product lists
- Search bar navigation
- Content layout
- Site navigation
To give you an example of how much these details influence purchasing behavior, just a change in the color of a “Buy Now” button can increase or decrease the number of sales an ecommerce store makes.
When website owners experiment with these design elements it’s called conversion rate optimization (CRO). Many CRO practices allow you to increase sales on a site very quickly because the changes are so easy to implement.
Let’s say for example you have an ecommerce site for which the average order value (AOV) is $250 and you receive 200 orders per month. If you add a “Customers Also Bought” section to the checkout page which increases the AOV by 20%, then your revenue would increase from $50,000 per month to $60,000 per month.
This is one example of the many fast ROI opportunities in website design. The other element of websites that can be optimized for more revenue is content.
Content sites like blogs occasionally need their articles updated with new information. While this thought might not ring cashier bells in your head, there’s more ROI-increasing opportunity here than you might think.
First of all, when you update articles in line with best SEO practices, you can increase their rankings in Google and drive more traffic to your site—more traffic equals more sales.
Second of all, there could be opportunities to improve the content to get more clicks on the affiliate links.
If the site is monetized through display advertising, you can experiment with the ads to increase revenue.
Ad Placement and Networks
Ad positioning has an impact on the number of clicks they get. Experimenting with ad placements in different areas on a site is a quick and easy way to potentially increase ad clicks and therefore ad revenue.
If your site is generating enough traffic, there may be an opportunity for you to upgrade to a new ad network that offers higher commission rates.
To do this, just connect the site to the new ad network and let the new ads run.
These are just a few of the many fast-ROI opportunities available in online businesses. But online businesses aren’t just fast-ROI assets; they can provide you with long-term, secure wealth.
3. Long-Term Wealth
Despite their reputation, online businesses can last.
While many grow and then fall due to market changes, penalties, and influxes of competition, some are able to ride through those waves and remain on top of their industries.
Online businesses that have been established for over three years are especially strong; by this time they’ve built wealth-generating assets that keep it earning profits.
The number one asset an online business has is its customer base. Any new business can come into the market and acquire new customers. Still, if they don’t retain those customers because they offer poor service or they only sell a product people buy just once every 10 years, then they’ll have to continually spend effort and money to acquire new customers to keep the business afloat.
A business with a customer base that continually purchases products has fuel to keep it earning. And a bi-product of a customer base is industry recognition.
Brands with big names have lasting power. They take market share from other, smaller brands and are thus able to grow their customer base and audience.
This not only secures the revenue already being generated by the business, but it also gives them avenues to acquire new customers to add to its revenue.
This leads us to the next financial benefit of owning an online business: it’s under your complete control.
4. You Have Control Over ROI
Unlike investment assets like stocks that are subject to the whims of the markets and economy, online businesses are manageable and scalable assets.
By implementing growth strategies like some of the ones listed above, you can scale your business to increase its revenue.
You can also secure your income with assets like trademarks and supplier exclusivity contracts to stop competitors from stealing your products.
Another way to secure your business’ income is by fortifying its operations, content, products, and customer service.
Efficient and effective operations make a business run with few costly errors. For example, a well-built supply chain will not lose many products in transit and with effective inventory management, the business will experience few stockouts, meaning it can continually sell products.
If you optimize a blog’s content for SEO and improve its quality, then you make it less susceptible to Google algorithm updates that can tank a site’s rankings overnight. You also establish the site ahead of its competitors which allows it to retain and grow its audience.
These are just a few examples of the levers of control in online businesses. You can solidify and maintain your business to have it earn almost-passive income for you, or you can implement growth strategies to increase your income.
The best thing about the income from online businesses is it isn’t taken away by costly expenses.
5. Cheap To Run
Compared to physical businesses that are built on costly assets like office buildings, online businesses are built online, so for most business models the overhead costs are low.
Even an ecommerce business has low overhead costs because in most cases they don’t own any of the assets in the supply chain. For example, an Amazon fulfilled by Amazon (FBA) business uses Amazon’s warehouses and delivery networks to store and deliver products.
Also, an ecommerce storefront is online, so there are no physical location costs.
Other online businesses like blogs have even fewer overheads. The profit margins for these businesses average between 85-95% because the only assets needed to build the business are a website and content.
Outside of website hosting and content production, there usually aren’t any other costs associated with blogs. Most blogs drive traffic organically through Google which is free, so they don’t even need to spend much on marketing.
The benefit of having such low operating costs is you can reinvest high amounts of profits into growth, which is why online businesses are so scalable.
If you’re starting to warm to the idea of acquiring an online business, then you might be curious as to how to find the right one for you.
Finding The Right Online Business For You
The two factors to consider when deciding on what type of online business to acquire are your budget and experience.
You should acquire a business a bit lower than your liquid capital so you have some fodder to account for low months or to invest in the business’ growth. To access business information of the businesses listed on our marketplace, if you provide us with proof of your liquidity you can browse businesses within 1.5X of your budget.
Your experience should also be taken into account.
The good thing about online businesses is you don’t need to have experience in the business model you’re purchasing to be successful with it. We’ve had real estate investors acquire their first online business and sell it for a substantial profit within one year.
We also get working professionals who acquire online businesses as a side source of income.
As long as you understand the fundamentals of the online business model you’re acquiring, the platforms it operates on, and have a basic knowledge of digital marketing, there’s nothing stopping you from being successful with an established, profitable business.
The best way to find the right online business for you on our marketplace is to create a free Empire Flippers account. In there you can use our 40+ search filters to narrow in on your ideal asset.
You can also create a wishlist, unlock business details, and get quick support from our customer support team or expert business acquisition advisors.
Create your free account and start finding your ideal business today.