It’s not easy to start an online business. There are many decisions that you need to make. Which product should you sell? What should you sell? How can you attract customers?

As if that wasn’t enough, every week seems to bring a new online business trend. Chatbots, cryptocurrencies and Instagram influencers are just a few of the many options. What should you be paying attention to? What is the most important?

We’ve got the answer for you if you are looking to learn how to start an internet business in 2021. This article will show you step-by-step how to start your own small business online. This article can be considered a guide for starting an online business. We explain everything in plain English, and provide simple, practical instructions to get you started.

How to start a business online (from scratch)

#1: Don’t start building yet

It can be tempting to jump in to action when you are looking to start your own business.

If you feel the urge to create a website, choose an appropriate business name or design a logo, don’t rush.

A strategy is essential if you are to create a profitable online business. This article will guide you through the steps to creating your online business strategy.

#2: Select a business model

It is helpful to have a list of tried-and-trued online business models to help you build your online business.

These are six types online businesses you should consider:

Affiliate Marketing: This passive income opportunity allows you to promote other businesses’ products and services online and earn a commission.

Freelancing: Offer your services to others and businesses by offering your skills, such as writing, programming, design, advertising, or writing.

Coaching and consulting: You can become a coach, or a consultant, and then sell your knowledge, advice, and guidance.

Information Products: Sell your expertise through ebooks, worksheets and templates.

Software as a Service (SaaS), where you create a piece or application and then charge users a recurring subscription.

Ecommerce: Shopify is a platform that allows you to create a website and then sell physical products online.

#3: Identify your target market

Next, identify your target market. Also, consider who you are going to serve.

This is a crucial step.

Philip Kotler, a marketer, once stated that there is only one winning strategy. It’s to define your target market carefully and to direct a superior offer to that market.

Here’s how to do it: Be part of your target audience.

It’s amazing, just think about it. You’ll be able to understand the needs, wants, and language of other campers if you have been camping all your life. It would be easier to sell camping products online.

Your marketing efforts will be more effective if you have a better understanding how to communicate with campers.

However, if camping is something you have never done, it would be difficult to sell camping products online.

When choosing a target audience for your marketing campaign, think about these questions:

What are my hobbies?

Do you know anything about it?

What are my most favorite things to think, talk and read?

#4: Find a problem to solve

It is important to remember that all businesses solve a problem when you learn how to start an internet business.

Leaking pipes can be fixed by plumbers. Hollywood movies satisfy boredom, curiosity and interest. Clothing brands allow people to express themselves and feel beautiful.

Here’s the golden rule. The more difficult the problem is, the more people will pay.

Take healthcare services, for example. These services solve a major problem and are why most people will spend a lot of money.

However, very few people will pay for you to stop your table wobbling. They don’t have to solve it, so it’s not a major problem.

The bottom line is that you must identify a problem you can solve in order to establish an online business.

These are just three examples.

  • Target market: Fashion-conscious teenage boys
  • Problem: Fashion-conscious people want to be different from the rest of the pack without spending too much.
  • Solution: Make a clothing line that is both flamboyant but also budget-friendly.
  • Target market: Marketing managers in multinational software companies.
  • Problem: Businesses must drive traffic to their sites.
  • Solution: To drive traffic, write articles that rank high on Google.
  • Target market: Working moms with young children.
  • Problem: Many mothers want to exercise regularly but don’t have the time.
  • Solution: Make a time-saving schedule and fitness program.

How do you solve a problem?

Ask for help in Facebook groups or online forums.

Google Keyword Planner can help you find what people are looking for.

Find online businesses that are successful and then identify the problem. Then, look for ways to improve it.

#5: Analyze the Competition

Competitors analysis is a crucial part of any online business.

Analyzing competitors will help you keep up-to-date with what is working in your niche and identify new trends and successful strategies, as well as anticipate market shifts. This helps you to define your messaging, positioning, as well as overall business strategy.

How do you conduct a competitive analysis of your competitors? These are some suggestions: Subscribe to the blog of your competitors

  • You can buy a product that they sell
  • You can abandon a product from their shopping cart
  • Subscribe to their newsletter
  • Follow them on social media

These steps should be documented with notes about each step. It is important to have the ability to access relevant information when you need it.

Analyzing their customer experience and looking at the content they use to engage customers, you can find tactics your competitors are using in order to drive sales.

Pro tip: To complement your research findings, consider doing a SWOT analysis. This is a blueprint that analyzes your competitors’ strengths and weaknesses in order to identify areas for improvement. This guide will explain how to use SWOT analysis.

#6: Protect Your Legal Bases

Every business that you start must comply with local laws. When you start an internet business, make sure to learn about the legal requirements.

Here are some legal considerations you should be aware of:

Structure of a business

Register as an LLC, sole proprietor or partnership to start your online business. While you can do your research and make decisions on your own, it is a good idea to seek the advice of a tax professional.

Permits and licenses

You may require a license depending on the type of business that you are starting. It varies based on where you live. Contact your state department for more information.

Tax obligations

Online business owners must pay income tax. If you sell products to customers in certain countries, you may also be subject to sales tax. Before you start your business, consult an attorney to find out about the applicable taxes as well as the online documents that will be required to file them.

Copyright, patents, and trademarks

These legal aspects will be important to protect yourself from potential problems down the line. Registering your trademark will protect your brand name from being used by others, which saves you time and money when rebranding.

#7: Choose Your Sourcing Strategy

You will need reliable and trustworthy inventory sources if you are interested in starting an ecommerce website.

This can be done in a variety of ways:

You can search for product manufacturers using directories such as Sourcify, Kompass, and ThomasNet.

Handshake helps you find wholesalers of product in your area.

Dropshipping suppliers can be found on platforms such as DSers.

This last option is very accessible and allows you to start your own business without having to make a large upfront investment.

Dropshipping allows your supplier to ship and fulfill an order after the customer has placed a purchase. They handle storage and logistics while you handle customer support and marketing.

#8: How to Setup Your Payment Methods

You are almost there! This is the moment to decide how your company will accept payments, and how you will be paid as a business owner.

You have many online payment options. Accepting credit cards, PayPal and Apple Pay are the most popular options.

Shopify Payments is an integrated payment solution that allows you to launch an ecommerce store. This allows you to accept most major payment methods, and it comes with 0% transaction fees.

Transferwise, Payoneer, Stripe, 2Checkout are all good options for a service-based online business such as freelance writing.

You should be able set your payout schedule regardless of which payment method you choose. You have the option to receive your cash daily, weekly, or monthly depending on how you prefer it.

#9: Create Your Sales Platform

After you have identified your business idea, and all legal requirements are met, it is time to start building your platform.


If you are looking to open an ecommerce store, create a Shopify website and then search for products to sell through DSers.

Shopify offers the possibility to plug in popular tools such as Digital Downloads to make digital products, ReCharge for selling subscriptions online and SendOwl for selling videos online.

Keep it simple.

Your business is still theoretical at this stage. Don’t invest too much time or money in building the perfect website.

Instead, test your business idea before you invest.

Eric Ries, author of The Lean Startup said that customers must be able to tell what they really want. Not what they think they should want.

#10: Select a Marketing Method

You must choose a marketing strategy before you can promote your online business.

There are many online marketing strategies. There are many online marketing methods that can be used to help you start your own business.

These are the top four online marketing strategies that can help you land sales quickly.

  • Social Media Marketing: Make and share content on social media, connect with your target audience and drive traffic to your site to make sales.
  • Direct Outreach: Reach out directly to companies to pitch your services.
  • Paid advertising: Place ads on platforms such as Facebook, Instagram and Google to increase brand awareness, drive sales, and make money.
  • Marketing with Influencers: Work together to promote your products to influencers.