There are a lot of ideas if you want to start an online business and become a business owner. You will find a list of ideas that are proven as good as well-established businesses.
Unlike Making Money Online, starting a business could be much more profitable, but a lot harder. The main difference between the two, starting a business and making money on the internet doing general freelance jobs, is the latter makes you more money and brings you income, while the former generates wealth.
Let’s stay on the easy and simple side away from complicated terms and bold phrases. The point here is not the difference between business and online jobs but giving you some good business ideas to start an actual business online and make money.
If you are only looking for the list, then use the menu below to navigate to the list, but if you want to know everything before starting an online business, make sure you read the entire article. In this Ultimate Guide, you will read about how to start any business and what are the requirements plus a list of the best business ideas that can make you rich in 2021.
Let’s dive right into the business and talk about the best ideas to develop an online business because there is a lot to tell.
Why Starting a Business?
I was talking about the difference between online jobs that make you money and starting an online business. While most people prefer to do online jobs on already established platforms or freelance gigs, some prefer to start a business and become a business owner.
While both have their advantages and disadvantages, starting a business lies within a market that has more capacity to accept new ideas, of course, if you do it right. The main difference between the two is that you have to do online jobs to make money, meaning if you stop doing them, the money stops.
This is also true if you put less effort, less money will be made as a result. On the other hand, there is a limit on the amount of money you can make doing online gigs too, meaning that more efforts can bring you more money, but too much of it won’t make a difference. You just get exhausted.
Starting an online business is different. If you establish a good business and monetize it, then you can still make money even without putting too much effort into it. That is why you generate wealth or revenue instead of simply bringing income.
But there is a downside too; Starting a business is much harder and takes a lot longer to get results. unlike making money on the internet, which is easier to start and maintain, there are a lot of tasks included, and many trials and errors are required to reach the tipping where when the money comes regardless of how much effort you put into the business.
About the limits in making money online, businesses don’t have those limits, meaning they can literally bring you unlimited amounts of money, while in online jobs, there is a limit because either you can do a limited amount of work per day, and the market is also flooded with competitors.
I had to discuss this boring matter because that depends on you to choose between freelancing or becoming an online business owner. But you don’t have to decide just yet. Read the rest of the article to see if you can initiate any of the business ideas.
Business Startup Requirements
While making money online doing freelance work or online gigs require the mastery of a few Freelancer Skills, starting an online business (or any business) with the aim to grow and expand in general markets, will require many Business Development Skills at the same time. Even the most genius and multitasking humans on earth can’t start a business alone. Every big company there is today, like Google, Facebook, Tesla, Apple, Microsoft, etc. were a dream individual (and sometimes more) but started by a team.
They were not alone when started. No one can do all the things by his/herself especially when it comes to initiating business ideas. There is simply not enough space in our heads to handle all the works ourselves, provided to learned and mastered all required skills.
There are four items every business startup require:
- A Team
- A Startup Budget
- A Comprehensive Business Plan
- A Sound Marketing Strategy
The First Requirement to start a business, a team consisted of different experts is required. One of the most important requirements, even before the budget, is a team of at least 3 people to start and manage a business. Even if your team doesn’t have specific skills and expertise for certain tasks, outsourcing is a good option, but mostly in the early stages of a startup.
However, you can’t outsource everything if you want to start and manage a business. As I said, you will need at least a team of three (including you). Every business needs someone to know what to do, someone to know how to do it, and someone to look after the business. They are respectively a Business Developer, a marketing expert, and a business manager. These three members of a team should be the most trustworthy towards each other because the business runs smoothly when they collaborate perfectly.
The Second Requirement for a business startup is budget. While making money on the internet may require little to no money, business startups usually require a budget to get things going in the beginning. There are a lot of startup costs that differ for every type of business, its business plans & marketing strategies, and the offered product or service.
I can’t give you a fit-for-all amount of money that is required to run a business, but I’ve given you an estimated minimum amount for each of the business ideas I’ve talked about in this article. Startup cost can be roughly estimated by providing a strong and comprehensive business plan and marketing strategy proposal, which are the third and fourth requirements to run a business.
The Third Requirement for business startups is a business plan plus a sound marketing strategy. A business plan is like a big pamphlet that explained everything about the business. A good and complete business plan for startups includes:
- Business Ideas
- Business Model & Overall Goals
- Products to Manufacture or Services to Offer
- Any Required Third-Party Collaboration or Outsourcing
- Current Competitors (if any)
- Target Clients, Customers, and Markets
- Market Opportunities & Capacity
- Market Demands
- Near & Far Future of the Business
- Startup Cost Estimation
- Bidget Source
- Required Skills and Resource
The above list could be much longer but that depends on the type of business and how it wants to work and generate revenue.
A business plan is technically a complex set of instructions to run the business and expand in the future, so you can expect to put a lot of effort into creating that, because the more you include in the plan, the more you can expect to have a successful business. And one more thing; Business plans are the result of weeks and months of brainstorming with the team and discussing every little detail, so don’t expect to make it overnight or something!
The Fourth Requirement is a practical & executable marketing strategy. Marketing strategy is something like a business plan but the content is different. While the business plan deals with the business in its entirety, marketing strategy only concerns the strategies to publicize the business, find more clients, and increase sales, all to end up in more revenue and more money.
The marketing strategy plan includes how to publicize the business using available tools and media. Advertisement campaigns, online and digital marketing efforts, social network marketing, product promotion, client outreach, customer support & followups, etc. are all that a sound marketing strategy should define precisely.
The marketing strategy should be planned after the overall schematics of the business had been determined by the business plan. When the business starts and is ready to reach for its potential customers for the first time, the marketing strategy will be applied to facilitate this process.
Any business that starts with these four requirements can easily reach its goals and succeed. These four items are required in almost all businesses, regardless of them being online or a brick and mortar (physical) one. More complex businesses can require more than these four items. You have to do your research as complete as possible to spot all requirements and fulfill them before starting.
And one more thing. Don’t start your business before you created a business plan and a marketing strategy. These are some of the most important stages for every business, especially for the early stages. Don’t make such mistakes because they will kill your business at some point when you don’t expect them at all.
Why This List is Different?
I think you got it by now. If you read other articles about business ideas on other websites, you know that they only listed a lot of items with a paragraph of text under them. They just tell you what to do, and not how to do it. If it satisfied you, and I really doubt it, then I can list you 500 more ideas for business.
I want to write articles that are actually helpful and visitors like you can be satisfied with the information. That is why I don’t stop after making a list of items, but I do a lot of research, either online or from my or my clients’ experience, which businesses tend to succeed more; A winning business!
That is why my lists might be shorter but more comprehensive. After all, this is the ultimate guide. What I did here is I only listed suitable and practical business ideas and talked about them plus how to do them and how to start such businesses.
Therefore, if you are looking to find how to start an actual online business from 0 to 100, then this is the article you should read, but if you only looking to find some ideas and do the rest of the research yourself, then this list only helps you with a few items. You have to find the rest elsewhere.
Best Ideas to Start an Online Business
If you jumped here then continue reading and see what are the best ideas if you want to become a business owner, but if you read the article all the way from the top, then congratulations! You are now familiar with how to start a business and what are the requirements to do so. Now you just need some ideas for some good business in 2021.
The following list consisted of the best businesses you can start and become a business owner. I handpicked every single item on this list after quite a lot of research and all the experience I’ve had with my past clients.
Not only you will get to know the overall idea behind each item in the list, but also I’ve talked about what you will need before and how to start it step by step. Go ahead and choose the one that suits you best.
1. Start an Amazon FBA Business
One of the best ideas I can tell you about is starting an Amazon business. It is called FBA and during the past few years had been one of the best opportunities Amazon provided for everyone. “But if everyone can use this opportunity, then the market would be flooded by now?” you might ask.
Amazon is the biggest online store and you can literally find everything to buy online. While Amazon itself sells a lot of products, there are more than 2.5 million active sellers from around the world who are also selling products there. About 200,000 of them are making over $100,000 per year and about 25,000 of there are making $1 million per year by selling on Amazon, and most of them never get to see their product at all.
Starting an Amazon FBA business is not as easy as you think, and many will quit along the way because the early stages of this business require a lot of hard work. That is why only 10% of Amazon sellers are making over $100k per year. But in the end, it’s one of the most profitable that I’ve seen compared to the amount of money you invest in.
What is The Fulfillment by Amazon (FBA) Program?
As the number one online marketplace in the world, Amazon is providing the opportunity for everyone to be able to sell any product online. This program is called FBA which is short for Fulfillment by Amazon Program. This program is designed in a way that everyone can sell online without the hassles of shipping, customer supports, and returns.
When you become an Amazon seller, then all you need to do is to find products that people buy, manufacture them and ship them to Amazon FBA warehouses, listing on Amazon, promote them, and start selling. When someone orders your products, Amazon will take care of packing and shipping as well as dealing with customers and returns.
In simple words, find products that have high sales, sell them, and make money while Amazon does all the hard works like packing, shipping, returns, and customer supports. That’s all. You do the online research and forget about the hassles of hard works.
Starting an Amazon FBA business is both easy and hard. It’s easy to set up your company, do research, and start selling, but keep up with all the tasks can be hard because you are actually dealing with a legitimate business. If you keep up and build good automation in your business, then you will reach the tipping point where you make much more money compared to your efforts; You will generate wealth.
I can tell you from my experience with my past clients, who I helped start their FBA business, that it will take between 6 months to 1 year to reach a stable income and +3 years to earn +100k per year and become one of the 200,000 sellers who make more than $100k per year (the six-figure society).
This is why patience is the key factor in a successful FBA business, and one of the Crucial Mistakes many sellers make. If you quit along the way, then there is only loss on your side, but if you are patient enough, then FBA is one of the best ideas you can start a business based on.
If you are willing to work hard, even behind the screen of a computer or laptop, then keep up because, in this Ultimate Guide, I’m going to tell you how to start an Amazon FBA business step by step.
The Business Plan
As I said before over and over, the first step in starting a business is the business plan. Amazon FBA requires a comprehensive business plan that includes information about the overall scope of the business. The business model is quite clear since you have to follow simple rules set there by Amazon, so your business plan should concern the following questions:
- What product should we sell on Amazon? And why?
- Who is going to manufacture the product?
- How the product will be shipped to the FBA warehouse?
- What strategies should we use for marketing?
In addition to the questions above, you have to determine the budget for starting an FBA business, which is usually discussed when the product manufacturing and shipping to Amazon warehouses are determined. Startup costs for FBA business vary depending on the product to sell and manufacturer location, but as an average, you will need about $3,000 to $3,500 to start. Although I’ve seen successful sellers starting with only $2k.
What is more important in a successful startup, In my opinion, isn’t the budget. If you choose the startup product wisely (the first product you are going to sell) and put enough time into market & product research, then your investments will return with a lot of profit in a period of 6 to 8 months, enabling you to go for the second product, when you first one is still selling well.
Therefore don’t rush into finishing the business plan phase too soon, and put a lot of effort into it. I’ve talked about every step of this business, including those you have to fit into your business plan such as product research, finding a manufacturer, shipping, etc.
Set up an Amazon FBA Account
This step is pretty straightforward. All you have to do is signup for an Amazon seller account. Amazon offers two plans for sellers: Individual and Professional.
- Individual Plan
- Professional Plan
The Individual Plan ($0.99 item sold + additional fees) is suitable for sellers who are not going to sell more than 40 items per month. Also, the individual plan doesn’t come with additional selling tools and analytics that can give you some insight to grow your business.
In the individual plan, Amazon will charge you roughly $1 per each item you sell online (plus additional FBA fees), so if you are going to become a big brand and a successful seller, go with the professional plan. Your goals as a business should not be limited to 40 items a month. You have to think big and sell big too.
The Professional Plan ($39.99 per month) is the right plan for every successful Amazon seller. In this plan, you will have a lot of features and data at your disposal to easily monitor your sales, products, marketing campaigns, and inventory. You can compare the individual and professional plans using the table below.
|Individual Plan||Professional Plan|
|Price (excluding additional FBA fees)||$0.99 per item sold||$39.99 per month sold|
|Add new products to the Amazon catalog||✔||✔|
|Grow your business with Fulfillment by Amazon||✔||✔|
|Apply to sell in additional categories||–||✔|
|Save time creating listings in bulk||–||✔|
|Manage inventory with feeds, spreadsheets, and reports||–||✔|
|Qualify for top placement on product detail pages||–||✔|
|Increase selling efficiency with API integration||–||✔|
|Set your own shipping fees for non-media products||–||✔|
|Attract shoppers with on-site advertising tools||–||✔|
|Run promotions including free shipping||–||✔|
|Add multiple users to your account||–||✔|
One of the important tips I can give you in this step, and many of my clients learned the hard way, is that prepare the required documents for verifying your FBA account. They include a valid ID, proof of residence, valid credit card, bank account information, and sometimes business license (rarely).
One of the most important and exhausting steps in opening a new seller account is identity verification that sometimes can take up to 3 months, and sometimes more. You have to read every single email Amazon sends you carefully and send the documents they want exactly how they tell you, and if you couldn’t verify your account at first, don’t worry. Go to the Amazon Sellers Community and ask for help. There are a lot of sellers there always willing to help you, especially during the verification step.
And one last tip; NEVER CREATE A SECOND ACCOUNT! If you failed to verify your account, don’t go for another one, because it will be closed almost immediately. Keep working with your first account until you are verified, and you will. It may take up to three months, maybe more, but it will be done.
Product research is where everything began. It is a crucial step toward starting an Amazon FBA business. What you are going to sell on Amazon, especially the first product, is what defines your success. You have to do your best to find a suitable product to sell, and you have to do that every time you are going to add a new product to your online store.
There are a lot of ways to conduct good market and product research. You can do this without using any tools or services, and completely do the research manually; The old-school approach. But you can also use some of the services available for Amazon sellers. They help you with your product research with a lot of data that you don’t normally find on Amazon. Their data comes directly from Amazon so you can find the products that people buy.
The best services that I know for product research are:
The benefits of using such services for your product research are unlimited because they easily bring you a lot of sales data directly from the Amazon marketplace that otherwise would be so hard to find. You can use these data to determine what are the best products that people want to buy. I recommend using these services to all my clients so they can manage to find the best product to sell on Amazon
When you decided which service to use, or decide to go old-school and search manually, then you should look for products that are suitable for selling on Amazon. You literally sell anything as long as they are ok with Amazon rules, but you have to choose products that people want to buy and also have the least returns.
Before going into details about the characteristics of perfect products to sell on Amazon, I have to give you this important tip that I saw not considering it may result in massive losses in funds and time. Don’t choose a product that you feel is good to sell.
It’s your opinion and might not be others at all. What you like to sell might not be what people want to buy. If your products remain in FBA warehouses for a long time, storage fees will go through the roof. Follow the data and search properly what people want to buy and not what you like to sell. Don’t go with products because you feel right about them.
Considering that tip, and having access to all sales data on Amazon, it’s time to do extensive product research taking the following characteristics in mind. The products that sell well on Amazon have a number of common criteria. They are products that are:
- Not fragile – Like glass or stone that might be damaged during shipping which results in more returns and low reviews and ratings
- Small & Light – Heavy, big, and oddly shaped products will include custom packaging which results in a higher shipping fee
- Priced between $15 to $60 – People tend to buy items with this price range more
- Simple & cheap to manufacture – To minimize manufacturing costs and increase profit margin
- Not prohibited or copyrighted – Prohibited like alcoholic beverages, firearms, or copyrighted like books, DVDs, and other media
- Not brand and fashion preferred – Like clothing and accessories that people like to buy a specific brand
- Not complex or battery-operated items – Like electronics, watch, phones, or hard-to-manufacture items
- Foods and Cosmetics – Basically anything that goes in or on the body
Taking these criteria into consideration, you have to search for products that have:
- High Sales and High Demands – People are highly interested in purchasing the item
- Low Competition – There are a few sellers on Amazon selling the item
- Not Seasonal – Only have high sales in a certain period of the year
- Not Patented – You really don’t want to go that way
Also, you can improve an existing product and sell a better version. To find such products, you have to look for bad comments and low ratings among customers’ reviews of products that have high sales. Selling improved products is a good idea, but you have to have the best communication with the manufacturer to ensure producing what you actually want.
When you decided what product to sell on Amazon, then it’s time to find someone capable to manufacture it. Depending on the size and the complexity of the product, you will need at least 1,000 to 2,000 units for your first batch. You have to look for local or international manufacturers with the following criteria:
- Highest quality standards
- Reasonable manufacturing cost
- Lowest shipment cost (if they can do the shipping)
- Can print customized packaging (this is optional)
- Able to conduct good, fast, and constant communication
You can order a local manufacturer to produce your items and then send them to the Amazon FBA warehouse. This is good and it surely helps the local economy. But what many Amazon sellers do, to increase their profit margins, is to order Chinese manufacturers to produce the items. This is way cheaper than locals because materials, manufacturing, and labor costs in China are quite cheap.
If you are asking where can you find good Chinese manufacturers, you can take a look at the Alibaba website. You can find thousands of manufacturers located in China and you can communicate with them directly. Alibaba is the marketplace for manufacturers, suppliers, exporters, and many other B2B businesses who are taking your order and manufacture them in large quantities.
You can search Alibaba using its advanced search features that enable you to find who manufactures the products you are looking for, how much they can produce, what are their quality standards, their capability in customizing the item or its packaging, and if they can ship the product worldwide.
Find at least 10 to 15 manufacturers and contact them, asking them if they can produce the item, with your desired quantity, and with improvements (if any). Ask them if they can create customized packaging and ship products to Amazon warehouses. Ask what you think is important for the manufacturer to know. They will contact you back and provide you with a price (quotation).
If you didn’t find a manufacturer among the 10 to 15 you’ve selected, then search for more, or use the Alibaba RFQ feature (Request for Quotation) to send almost all manufacturers, who can produce your item, a request for price and quotation. Surely someone will reply. I’ve never had a case where no manufacturer replied with a quotation.
Also, Alibaba provides Trade Assurance Program where you are protected against any problem along the way from ordering to receiving the shipment. Therefore you can be sure that you will receive your order in the exact quantity and exact quality.
In fact, Alibaba provides many services such as onsite quality control and verification of the manufacturers, so if you see manufacturers with a Verified and Trade Assurance badge, you’ll be ok ordering from them. Take this tip in mind when you are looking for one on Alibaba.
You can also hire onsite product inspection agents from third parties inspecting companies like AQF, Tetra Inspection, and QIMA. They will visit the manufacturer on your behalf and conduct quality control on your products. Then they will send you a pretty long report about your product, manufacturing process, and its quality to ensure you that the manufacturer is doing its best. They often include photos too so you can have a look at your manufacturer’s factory.
When you find a good manufacturer, make sure they giving you the best possible price. In your RFQ letter, add a paragraph about if you choose them as the manufacturer, then there is a possible long-term business relationship that includes ordering larger quantities. Tell them to quote you with their best price. Also, make sure they are willing to negotiate about the payments. If they accept two-part payments, that is ideal for your business. It is usually 30% first and 70% upon shipping, or 50% first and the rest upon shipping.
To conclude the supplier and manufacturer outreach section, search for manufacturers on Alibaba that have the following criteria:
- Verified by Alibaba
- Joined the Alibaba’s Trade Assurance Program
- They communicate perfectly and fast
- Willing to negotiate about pricing and payments
- Capable of shipping to FBA warehouse
- Capable of printing customized packaging
- Capable of changing and improving the original designs
- Provide Shipment Insurance
- Have good reviews and ratings on Alibaba
- Delivered a lot of orders before
Also, you have to stay away from manufacturers who are:
- Communicating incomplete, late, or don’t answer all your questions
- Asking you to take the business on Skype or Whatsapp (Anywhere but Alibaba chat)
- Asking for payments with Western Union or in Crypto (You know why!)
- Keep insisting to change your ideas and asking you to order this instead of that
That’s it for supplier outreach. Now, let’s go for the rest of the process of this Amazon FBA business.
Get a Barcode
Each product you want to sell either online or in a brick-and-mortar store, requires a barcode to be identified in a global database to verify who produced and sells this item. In order to sell on Amazon too, you need to purchase a barcode for the products you want to sell. This will be printed on the back of your packaging or will be placed somewhere on your product.
Keep in mind that for a line of the product only one barcode is required. For instance, if you have product A with 2,000 units in the warehouse and product B with 1,000 units, how many barcodes will be required? Yes! only two, because you are selling 2 lines of product that happen to have many units. Also if your products are sold in variety, like different colors or materials (or both) then one barcode is required for each variety. In fact, each variety of an identical product you sell will be considered as a separate line of product.
Now if you are asking “I only want to sell online. Why should I purchase and use barcodes?” then you have to know many sellers are selling identical products, each with their own packaging and brands, but they are all same. so if your product is exactly the same as another seller, then you don’t want your orders mixed up with another seller. Therefore Amazon uses a set of barcodes that help them, and you track inventory and prevent order mixups.
In order to sell your products on Amazon, you are required to have 3 barcodes/identifier codes:
- Universal Barcode (UPC, GTIN, or EAN)
- ASIN (Amazon Standard Identification Number)
- FNSKU (Fulfillment Network Stock Keeping Unit)
Universal Barcodes are those barcodes you see on the back of every product you buy, no matter online or from physical stores. You will need UPC, GTIN, or EAN barcode depending on which countries you are going to sell your products to. Usually, UPC and GTIN work for all, and EANs are mostly used for European markets. You can purchase these barcodes from GS1 and GTIN, and remember only one barcode per each product or variations of the product.
You can purchase them at a lower price from websites like NationWideBacode, but in order to prevent any problems in the future, it’s better to buy them from GS1 and GTIN. Remember if you buy some rip-off barcodes and Amazon finds out, then you’re going to have a lot of problems including account suspension, selling privilege limitations, and even blocking your seller account!
ASIN or Amazon Standard Identification Number is a ten-digit alphanumeric code that Amazon assigns to products. All products on Amazon have ASIN codes (with the exception of books that have ISBN). You can get ASIN for your product when you create a new product category and listing on Amazon. This code is not required to be printed on product packaging because ASIN is the code Amazon uses within its organization and is used for search engines to look up though more than 350 million products listed on the site.
FNSKU or Fulfillment Network Stock Keeping Unit is the barcode that is unique to Amazon and helps them to credit a product to the corresponding seller, so they won’t get mixed with other identical products during the fulfillment process. It is also the barcode that helps you track your inventory and your product throughout the entire FBA process from entering the warehouse, ordering, and selling.
FNSKU barcode can be obtained from your dashboard on Amazon Seller Central. You can either send the barcode to your supplier so they will print it on the packaging before shipping them to the Amazon warehouse, or print them yourself and attach them to packages yourself (if you receive the products yourself before shipping them to the FBA warehouse).
Design an Interesting Packaging
One of the crucial factors that can make a difference when people are deciding to buy your product or your competitor’s, is the design of your packaging. A better and beautifully designed packaging is what makes people choose your product when they are shopping online.
While it’s easier for people to shop online, there are certain difficulties like not being able to see the product physically. Therefore people have to make their decisions based on the product images and descriptions. This makes the work for sellers harder. You have to provide the best content for customers so they decide to go with your product than an identical one just right next to yours.
The packaging is one of the factors that give your product and your brand a sort of legitimacy. It will improve your brand trust. People see how professional your packaging is and they will order yours, even if the price is a little higher than others. This is because they tend to buy from well-established businesses, and they get this feel from how professional is your packaging, logo design, listing quality, etc.
A professionally designed package should include the brand, name of the product, a picture or a drawing of the product, and the model name (if any) on the front side. On the back, however, information like instruction to use, how to keep/wash, how this product was made using what materials, any important note the customer should be aware of, a contact method with your as the seller, and everything you think is important should be printed.
Also, there are some regulations around the packaging of the products. Depending on the material and the overall form of the packaging, there might be some labels and warning stickers requirements to be printed on the back of the box/plastic. These regulations are internationally, and not provided by Amazon. For example for plastic packaging, or any kind of packaging that includes plastic wraps, a suffocation hazard label should be printed on the packaging as a warning as well as a disclaimer.
Therefore, as I said before, choose a manufacturer and supplier who is capable of printing your custom packaging and know all the regulations regarding the packaging and all the labels and warnings it should include. If you are looking for a good graphic designer to make a professional-looking package for your product, then take a look at freelancers’ marketplaces like Fiverr or Upwork. There are a lot of gigs, especially for Amazon product packaging.
Get Samples for Product Photography
When your production began and the first items rolled out of the manufacturing line, ask the manufacturer to send a few samples to your address for product photography. Manufacturers usually send sample products for free and you only have to pay the shipping fee. Sending product samples from China will be around $40 to $50 for 3 to 7 samples. It’s not much and you have to get some samples because your product listing on Amazon needs some photos.
When there is a fancy word like product photography, it’s not really a big deal. You don’t need to have the best DSLR camera to take amazing photos. Many sellers, even after years of successful business, still uses their phone cameras to photograph their products for Amazon listing. What you need is just a well-lit environment, or have some table lamps lying around, you can take the best shots from your products even with an iPhone.
If you browsed through Amazon’s listings, you probably notice that all product photos have some identical properties. For example, all of them have a white background, and at least 80% of the image is filled with photos of the product. This is because Amazon has some rules and regulations for product photos, and you have to obey them if you want to have a top-quality product listing and avoid Amazon warnings.
For this section, I’m going to talk about two main subjects concerning your product images:
- Product Photography Essentials
- Photo Criteria and Formats
First, let’s talk about Product Photography Essentials. Your products should be placed on a clean white sheet. This makes the editing phase easier, as you have to make the background completely white. Also, take your photos where the lighting is good and your product casts little to no shadow on the sheet. If you don’t have good lighting, then don’t worry and don’t rush out to buy studio lamps.
Two or three desk laps can be placed around your product, preferably with neutral lighting color (cold and warm light together). This will create a well-lit condition for photography, while eliminates any hard shadows that will make editing difficult.
You have to provide a lot of photos of your product and edit them to fit for a perfect product listing. Take and edit photos…
- As a perfect shot from the product at a good angel (product main image)
- Showing all angles of the product (front, back, top, side, etc…)
- Showing the product packaging (or what includes in the packaging)
- Highlighting the details or important features of the product (if any)
- Showing the product being used in real life
- Showing how to use the product (a quick get-to-go instruction)
- Indicating the size and measurement of the product
You can upload up to 20 photos for your product listing, but Amazon will only show the first 7 photos, so make them as perfect as possible. The first image is always your main product image, and it should show your product at a perfect angle. It should also occupy at least 80% to 85% of the frame, and the background should be solid white. If you want to add text and graphics to an image during editing, make sure they are short, to the point, and informative, otherwise, Amazon will reject them and you have to upload something else.
Now, let’s talk about Photo Criteria and Formats. These are more concerned with the technical requirements your photos should have like dimensions, aspect ratio, file size, and general criteria product images should have. There are four topics we have to cover here: technical requirements, editing & design criteria, image content policy, and main image guidelines.
- Technical Requirments
- The image dimensions should be at least 500 px up to 10,000 px
- Amazon recommends a 2,000 px by 2,000 px image (1:1 square image)
- The maximum aspect ratio for Amazon product image is 5:1
- The maximum filesize for uploading product images is 10 MB per image
- Accepted formats are JPEG, TIFF, and GIF, but the recommended format is JPEG
- Editing and Design Criteria
- The product should be in focus and well-lit
- Short, to the point, and informative texts only (only useful texts are allowed)
- Solid white background (#FFFFFF or RGB 255, 255, 255) without any shadows
- It is recommended to occupy 85% of the frame with the product and content of the product image
- Image Content Policy
- The photo should not be offensive in any way (adult, racist, etc.)
- The photo should not be copyrighted or include copyrighted contents
- The photo should resemble the item being sold on the listing
- Main Image Guidelines
- The product should be in focus and professionally lit
- The background should be in solid-white color with no shadows
- No text, logo, watermark, etc. should be present on the main image (logo on products is an exception)
- At least 85% of the frame should be filled by the image of the product with enough margins for background
- It is better for the main image to be 1:1 square and at least 2,000 px by 2,000 px
To wrap product photography, you can do this yourself. Photography using your mobile phone or a camera is not hard. It’s a good and useful Freelance Skill and you can learn it fast and take photos yourself. If you want your photos as perfect as possible, freelancers will help you take good photos. You can find them on Fiverr or Upwork and send them some samples. They’ll do the rest!
You can also make one of the image slots (usually the last one) a short introduction and how to use a video featuring your product. It is recommended to make a video no longer than 1 minute featuring everything about your product and maybe a short instruction on how to use it. Just make sure to read about the product video content policy on Amazon before attempting to make one.
Ship Products to FBA Warehouse
When the manufacturing is done and your items are ready, you have two options depending on where you live. Sellers located inside the United States prefer to receive the products themselves, check them, and ship them to FBA using domestic postal services like FedEx or UPS. Amazon and UPS have a business relationship that provides sellers with good discounts if they want their products delivered to any FBA warehouse inside the US.
While many US sellers do this, there are also others who choose to ship products directly from the manufacturer to the FBA. This usually comes at a cost that depends on the freight forwarder. This is also what international sellers who sell on Amazon US do with regard to their products. They either ship them from the manufacturing site or the nearest port to the FBA warehouse or the nearest port to the determined FBA warehouse in the US.
If you ship directly from the manufacturer to the FBA, then it’s simple, but costs more. Manufacturers usually deliver the products to the nearest port in China for free, and you can hire a freight forwarder to ship the goods to the nearest port to the destination FBA warehouse in the US, and scheduled a domestic delivery like UPS to pick them up and deliver them, with discount, to FBA warehouse.
This is a little more complicated requires more calls and emails, but it costs less. There are online freight forwarders and exporting companies willing to do this for you. Companies like Flexport and Freightos are there to help you with your shipment from China to any FBA warehouse around the world with real-time online tracking service.
They will also help you with all the export, import, and customs fees & partworks, so you don’t need to confuse yourself with all the paperwork. There are other options too. You have to look them up on Alibaba.com or online. Maybe a Google search can help you out.
When it comes to shipping, you have two options. You can send your products either via air freight or by ocean shipment. Sending by air will cost more but your cargo will arrive quickly, usually between 1 and 2 weeks. On the other hand, sending your products by ocean shipments will cost a lot less but it takes between 30 to 60 days to arrive.
Choosing between these two depends on your time and the size of the cargo. You can also use both at the same time, sending a part of your cargo by plane, so they will arrive faster and you won’t run out of stock in your inventory, and sending the rest by ship to save costs. This is what I usually recommend to my clients, especially when they are selling a lot of items every day.
Shipments fees are per item, but that’s not the only factor. If you have a lot of items to ship, that literally fill a 40 ft. container, then your cargo size is called FCL (Full Container Load) and it is cheaper per item. On the other hand, if your items only occupy a part of a container, the forwarding company has to fill the rest of the container with other shipments. In this way, your cargo size is LCL (Less than a Container Load) and the price per item is higher.
This is because forwarder prefers shipping full containers. After all, they don’t have to separate the cargoes from FCL containers when they have arrived at the destinations. Generally, LCL shipments require more manual work and more workforce before reaching the final destinations, and that is why the price is a bit higher.
Whether to go by shipping via sea or by plane is totally up to you and requires your experience along the way. Many sellers usually research beforehand while some trial and error different methods. What I usually recommend is to find sellers selling similar products and ask them how they are sipping their items. Many of them will be more than happy to help you out solving shipping issues.
In general, the smaller and lighter your cargo is, shipping by plane could be a good option on the table, especially when you need them at the FBA warehouse as soon as possible. If, on the other hand, your cargo is larger and heavier, you can either send it in two parts one by air and the other via sea or send the entire shipment by the ocean if you are not in a hurry.
Just remember to never run out of stock on Amazon because it could be a very bad point for your product listings and seller rank. Always make sure your inventory is full enough for the next 40 to 60 days’ demands, and reorder items if you are about to run out. Neither Amazon nor customers would like to see “Out of Stock” on product listings, so make sure you always have shipments on the way before running out of items to sell.
Amazon FBA Fees
While selling on Amazon is a profitable business, provided you choose the correct product to sell, it also incurs costs. Amazon will do most of the work like picking, packing, and shipping upon customer orders, but obviously, it’s not free. Selling on Amazon costs money, but if you choose the correct product, and put a good price tag on it, the minimum profit per each sale is around 50% to 120% when all fees and costs are deducted.
In order to sell on Amazon, you have to consider four main fees that Amazon require you to pay:
- Selling Plan Fees
- Referral Fees
- Fulfillment Fees
- Storage Fees
Selling Plan Fees is what we talked about before. Depending on the type of account, you have to pay monthly (or per order) fees. To get the full features of the FBA program, you have to signup for a professional account. It will cost $39.99 per month + additional FBA fees.
Referral Fees are the percentage (or commission) Amazon takes from every sale you make. It is different for every category of items on Amazon and it normally ranges from 8% to 20% and sometimes more. For example, referral fees for selling an item in the Home & Garder category is 15%. To see the full list of referral fees for each category on Amazon, click Here.
Fulfillment Fees are the costs of storage, picking, packaging, and shipping the items to the customers, as well as returns and customer support. It is basically the fee for all the hard work. Don’t worry, it’s not much. If you choose a product with standard size and weight, according to the criteria I told you earlier in this article, then you can expect to pay around $2 to 5$ for picking, packing, and shipping.
Fulfillment fees are different for every item. It depends on the size and the weight of the item, all after packing. So if your item packaging size is “Small Standard” (15″ x 12″ x 0.75″) and weighs between 10 to 16 oz. + a 4 oz. packaging, fulfillment fee will be about $2.63. This is assuming that your item is not categorized as apparel (clothing). There are different fees for apparel items. If you want to see the full list of fulfillment fees, click Here.
Storage Fees is the money you pay to keep your items in Amazon FBA warehouses. Storage fees are calculated based on the amount of space your goods occupy in Amazon’s warehouse measured in cubic feet. The table shows the storage fees for standard or oversized items per month.
|January – September||$0.75 per cubic foot||$0.48 per cubic foot|
|October – December||$2.40 per cubic foot||$1.20 per cubic foot|
As you can see, it costs much more to store your goods from October through December than from January to September. That is because of all the holidays and Black Friday when people tend to shop online more and Amazon has to handle a lot of orders and goods in its warehouses. Also, there are extra fees for items classified as dangerous goods.
You have to choose a product that sells fast, so you won’t hit cost overrun due to storing them in the FBA warehouse for too long. If your products are stored in FBA warehouses for longer than a year, then additional inventory storage fees (long-term storage fees) will be applied. Also, you don’t want to request a return for your items because it costs even more than shipping them from China.
One of the important decisions you make is product pricing. It is really important what price you choose to sell your products to customers. Do you remember when I was talking about specific criteria for the product you choose to sell? One of them was the price range, which was between $15 to $60. This is an important range where most of the sales on Amazon (and basically any other online marketplace) take place.
If you look at the data and analyze them during the product research phase, you will find a pattern where items between 15 to 60 dollars sell a lot more than products that are cheaper or more expensive. The thing here is that people tend to buy products within this price range. They don’t pay more than $60 to buy something online and usually prefer to buy it from a traditional brick-and-mortar shop, and also don’t buy anything under that because they feel it will be some low-quality product. This is a fact and data supports that.
While there are instances where products under $15 have high sales, but sellers won’t make enough profit, and it doesn’t worth it considering all the efforts for product research, manufacturer outreach, and marketing. Therefore, cheap products less than $15, are not only less appealing for buyers, but also don’t have a good profit margin for sellers too.
The philosophy for pricing your products on Amazon is simple. First, you have to add up all the expenses including product fees, shipping fees, and Amazon FBA fees (all per unit). Then consider the referral fee for the category you are selling in and determine a price that gives you something between 60% to 120% profit margin.
For example, imagine you are selling an item in the Kitchen category on Amazon. Manufacturing and shipping it to the FBA warehouse costs $5 per unit. Amazon referral fee for this category is 15% per sale, and depending on the size and weight of the product, let’s say the fulfillment fee is $2.50. If you sell your product for $20, then the referral fee will be $3. Product costs for you as a seller will be 5 + 2.50 + 3 = 10.50. This means for $20 per sale, your profit margin will be about $9.50 which is about 90% of the product cost.
Actually, Amazon provided a Cost Calculator for sellers where you can determine how much profit margin you’ll have if you choose a price for your product. It’s very simple. Just type in the required information and you’ll get how much profit you will earn per sale. Something that this calculator considers, and you have to do it yourself, is marketing expenses (advertisements, giveaways, and discount coupons).
Also, make sure you check the price of your competitors. If you are selling the exact same product, maybe with simple packaging, it’s a good idea to go with the same price or a little lower. If you improved an existing product, then you can assure customers that your product is better than others and it worth it to pay some extra dollars to buy it. Sometimes, going lower than other competitive prices works, especially during earlier stages of FBA business, but you have to sacrifice some profit margin.
Create a Product Listing
Product listing is the equivalent storefront that showcases your products on Amazon. Every single product available for sale on Amazon has a product listing that includes all the information buyers will require:
- Product Title & Name
- Product Images
- Key Features
- Customer Reviews
- Product Specification (size, weight, etc.)
When someone searches for a product, the Amazon A9 search engine, and its algorithm start looking for the best matches. I will talk about A9 after this section, but what you should know about the importance of this algorithm is the importance of your product listing content. You should SEO optimize your product listing as much as you can.
SEO stands for Search Engine Optimization and it is a series of techniques you employ to grab the search engine attention when a search query is made by a user. So you have to optimize your product listing by including keywords, search phrases, unique informative content, images, etc. that A9 shows your product listing to buyers who searched for a product that you sell or even a similar one.
Before starting to work on your listing, you have to conduct good keyword research. Keyword research is to look for whatever people type in the search box to find a product similar to yours. It could be a word or a phrase. For example, if the customer is looking for a Garlic Press gadget, (s)he will search “garlic press” or “garlic smasher” or “stainless steel garlic press”. Basically, good keyword research will show you all the keywords and phrases people use to get to the product and buy it.
You can use KeywordTool.io for keyword research or use Amazon search suggestions to see what keywords are used the most. When you had a list of keywords, you have to include them in your listing. Amazon product listing includes sections where you can use your keywords and optimize your listing SEO.
- Product Title
- Product Bullet-points
- Product Description
These three are beside the product photos that play an important role in your listing optimization. We talked about how you should take photos from your product in this post so take a look at them some paragraphs above if you don’t remember.
Product Title is clearly the name of your product, but you don’t need to just type in the brand and the name only. You should provide a meaningful title that includes all the aspects of your product. Also, you don’t need to include your brand name unless your goal is to increase brand trust, which is not the point here.
What you should include in the title are:
- Brand name (if necessary)
- Product general name(s) (main keywords)
- Product size, color, material, features, etc.
- Anything that comes with packaging (if there is any)
So if you are selling a garlic press on Amazon, don’t just type “Mybrand Garlic Press” in the title. Instead, go for this title.
Mybrand 6.1 in Stainless Steel Garlic Press – Slip-free Handles Garlic Crusher – Dishwasher Safe Garlic Mincer – Easy Garlic Peeler Included
As you can see, I’ve included three main keywords in my title (italicized words) plus its features like dishwasher safe and slip-free handles. I’ve also included color/material (stainless steel) and the extra that comes in the packaging (garlic peeler).
Product title can be as long as 200 characters (for some categories) but in order to see the full title in search result pages, don’t go over 150 characters. In my example, I’ve used 141 characters and included three main keywords. That is easy if you practice a little and look at other products similar to yours on the Amazon search result page.
Product Bullet Points or Product Features are the small sections under the product title on the listing page. You can include 5 bullet points for each product, and each bullet point is limited to 500 characters. I like to look at bullet points as a longer version of the product title. So you have to explain whatever you included in the title in bullet points. I usually use this strategy for product bullet points:
- Product name, size, color, material, etc.
- Product usage
- Product features
- Package content
- Extra detail
Make sure you use all 5 bullet points and include some keywords and phrases in them. Also, start each bullet point with capital letters or with a symbol (like ✔ ◼ ▶ ➡ ✴).
Product Description or Product Details are everything about your product. You can include anything about it including all the features and manufacturing process. You have to write a product story! This is the last place you have to include any keywords you got. Use them in a meaningful sentence and include a few images as well. The product description should be at least 150 words to be effective for the A9 algorithm.
That’s it! Just add product photos and you’re done with product listing. Just make sure all information you provide is following Amazon Product Detail Rules. They are just some simple rules and guidelines for sellers to follow.
Amazon A9 Search Engine Algorithm
Like Google search engine, Amazon has its own search engine too that ranks products by specific criteria depending on what customer (users) type in the search box. Amazon search engine is called A9 and it employes a sophisticated algorithm that scans the entire Amazon marketplace and its product listings.
Amazon A9 is an AI (artificially intelligent) algorithm and aims to show the most relevant products based on customers’ queries. In order to do this, A9 loos for all kind of metadata on product listings and prepare the best results for users. A9 algorithm uses both SEO and relevancy as factors to rank listings higher on the search result pages. Factors that play important roles in Amazon search result ranking are:
- Product listing content
Product listing content refers to the text content. Everything that contains text on your product listing will be scanned by A9 so you have to SEO optimize your product listing as much as you can. You have to include informative texts that are easy to read, have meaning, and describe exactly what the product is. You also have to include your keywords a few times so A9 can easily understand what your product actually is.
- Product images
You have to include at least 7 high-quality images (2000px by 2000px) of your product from different angles, in use, packaging, product features, contents inside the package, etc. This is very important and A9 puts a lot of value in listings with good images. I’ve talked about how to take good product images above so keep in mind to read it before taking any photos.
- Sales & orders
Another important factor is sales and orders. A9 shows products higher on the results page that has more sales. Sales velocity indicates that people like to buy your product. So A9 will show products with more sales and orders for relative search terms.
Nobody likes to see “Out of Stock” where the price should be on the product listing. So make sure you always have enough items in your inventory in order to prevent going out of stock. Product availability is a huge factor for A9 and if a high-rank product with a lot of sales goes out of stock, A9 will technically bury the listing in the depth of Amazon results pages, maybe page 5 or even 10. You should NEVER go out of stock. Make sure to always order more from the manufacturer and ship to the FBA warehouse to prevent this.
A9 considers the product price when scanning the Amazon marketplace. If, for example, the average price of an item is $15, A9 will rank products with an identical price range. If a product listing is $35 for no specific reason, then A9 will not show that listing. This is because people will not even click on a listing with a higher price when there are a lot of alternatives at a lower price.
- FBA products
Amazon A9 algorithm prefers to show products that can be delivered to the customer on time. That means they have to be picked, packed and shipped the minute an order is placed. Who can do this faster than Amazon itself? Nobody. That is why A9 prefers to show products that are fulfilled by Amazon itself so customers will receive their orders as soon as possible. So if you are one of the FBA sellers, it’s great, but if you are fulfilling the orders by yourself, then A9 might not be so generous for you.
- Advertisement campaigns
Amazon A9 looks for sellers who promoted their products via PPC ad campaigns and will show their ads on the top of the search result page. The order of their appearance on the top depends on the bid for the keyword, meaning sellers who bid more on a specific keyword appear first. Products promoted via PPC will rank above all organic listings. I talked about Amazon PPC a few paragraphs below.
- Promotion & discounts
Amazon likes to see their customers satisfied with their orders and want them to become returning customers for more orders and more purchases. This factor affects the A9 algorithm in a way that products with promotions & discounts have more chance to appear higher on the product search result page than products without any of them. This factor especially shows itself around holidays and special dates where everyone expects discounts and sales like Black Friday, Christmas, etc.
- Ratings & Reviews
Higher ratings and good reviews indicate that the product is a well-made high-quality item that satisfied customers who purchased it. A9 likes to rank such products higher on the result page. This, as mentioned, will result in more satisfaction and fewer returns. With certain marketing campaigns, you can encourage your customers to honestly rate your product and write reviews, but don’t even try to tell them to give you high ratings or write good reviews in exchange for discount coupons or as such, because Amazon will easily find out and will suspend your selling privileges. If you are asking for rates and reviews, ask for honest ones even if it’s low and bad.
- Use of Amazon A+ Premium Contents
Amazon A+ Contents and Premium Contents are features that sellers with certain eligibilities can use for their storefront and product listing descriptions on Amazon. They include fancy tools and gadgets for designing and adding more images, data tables, and graphs in their product descriptions. In order to use such tools, you have to be eligible for Seller Brand Registry. A9 algorithm tends to rank products with A+ content higher than regular listings, but this factor is actually the last thing A9 considers since the process of the brand registry could be a tough one.
Promote Your Products & Marketing
After all the efforts of buying, manufacturing, shipping, and creating a product listing, the sale starts. But you shouldn’t expect to have sky-high sales the minute you submit your listing on Amazon. Even with extensive SEO optimization, your listing is pretty much is placed deep in the search result pages at the first. The more sales you make at this stage, the higher your rank will be on the results page. How to do that? Promote your product and do marketing.
In order to promote your products, there are a number of options available for you. The first one, of course, is the Amazon PPC ads campaign, which is the best way to promote your products on Amazon, especially in the earlier stages of product launch. Amazon PPC is like Google ads but only within the Amazon marketplace. I will talk about this in the next section.
Product launch and early stages of selling on Amazon could be a little hard and will need good budgets for marketing and product promotion. Around 20% to 35% of your overall budget might go for launching your very first product on Amazon in order to build a good seller rank that will help your later product listings to rank easier.
Apart from Amazon PPC, which is a great way to start, you have other options for a successful product launch on Amazon:
- Write Blogs & Make Videos
This is what you can do even before your sales start on Amazon. When your manufacturer starts producing your item, you can start a website and write about your product and promote it. You can also guest post on other websites if managing your own is a burden. This is a good way to tell people about the features, quality, usage, etc. Include some images, videos, reviews, and everything that notify potential customers about your upcoming product.
Try to make an email list by including a subscription form in your posts so when the product is out, you can send an email to everyone who read about it. Also, include keywords in your post and get some backlinks for your website or post URL to increase the chance of being seen in search results.
- Social Media Marketing
Create social media pages on popular platforms like Facebook, Instagram, Twitter, etc. Start rolling out images and content on them with a link to your product listing on Amazon. Start gathering followers & likes and build a community with the goal of promoting your product and increase sales. Start a hashtag and try to make it a trend.
Pretty much everything you do on social media and every post & image your share will help you and your product being seen by people who might need it. If you are new to this social media marketing thing, then try to follow some successful sellers who are promoting their products on social media. Take a look at their strategy and how they post content. You can also search for already trending hashtags that can work for your product too.
- Influencer Marketing
Another idea to promote your product is like a form of paid advertising we call influencer marketing. Basically, you make a list of people who have an active community following their profile on any social network (Facebook, Instagram, Youtube, and Twitter), a. k. a. online celebrities. Then you start contacting them asking if they can promote your product and how much it would costs to do so.
Influencer marketing is a good strategy if you want a large sum of people to see and know about your product. You can combine influencer marketing with some giveaways or discount coupons, so more people are willing to purchase. My experience showed that influencers usually charge less for Amazon product promotion. They will charge for each sale by leading buyers to a special affiliate link of your product. It’s usually 8% to 15% but it very depends on the category, Amazon referral fees, and some other factors that are not so important.
- Conduct Competitor Analysis
Competitor analysis is twofold. First, you conduct a competitor analysis to see how they are promoting their product and increasing their sales. You have to target and monitor successful sellers who are selling products in the same category as you do (or the same product) and analyze their marketing strategy. You can employ the same strategy, of course, with some changes, to have the same effect.
The second is monitoring your competitors’ product pricing and try to sell your product at the same price or a little lower. But, there are many instances that this leads to a price war that will eventually leave the starting side to great losses. Lowering your price is a good strategy to win “Buy Box” when the products you sell are similar to your competitor, but it is also a dangerous strategy that limits your profit margin and sometimes leads to losses, so be careful with that!
- Discount Coupons
A good way to launch your product for the first time, even without promoting it on social media, is to give away discount coupons. You can generate discount codes in seller central and use them to promote your products on product launch services. Some examples of good product launch services are:
You can also ask buyers who use your coupons to rate your product and leave a review in order to increase your seller rank and product listing rank. However, you should ask them to leave their honest review and not telling them to rate five stars and leave good reviews. This is a behavior Amazon won’t like at all. Also, people trust products with more ratings and reviews, so make a denture in your marketing plan to remind your customers by email to leave reviews and rate your product on Amazon.
Amazon PPC Ads (Pay-Per-Click)
Like Google Adwords, Amazon has its own internal advertisement system which is called Amazon PPC (Pay-Per-Click). It is a way to promote your product listing on the top of the search results page for specific keywords. Sellers bid on specific keywords and the product listing of the highest bidder will appear first followed by other sellers who bid lower, even by $0.01.
Amazon PPC campaign is available in three forms:
- Product Display Ads or PDA that leads customers to the product details page and is only available for vendors on Amazon
- Sponsored Products that are keyword-targeted ads for product listings to appear on the search results page
- Sponsored Brands that enables brands and sellers with registered brands to display custom headlines, images, logos, etc.
The form of PPC ad you need on Amazon is the second one (Sponsored Products). The Average Cost-Per-Click (CPC) for PPC ads is from $0.01 to $3.0 but it depends on your competitors’ bids, the category you are selling on, and how competitive your niche is. When you run PPC for marketing, every time a customer clicked on your ads, the keyword bid will be charged on your account and if (s)he buys your product, then the PPC ads fee will be deducted from your profit margin.
The easiest way to run an Amazon PPC sponsored product ad is to set into automatic keyword detection and leave it for a week or two and then switch to manual targeting only keywords that had the best ROI (Return of Investments).
Unlike Google Adwords, sales made via sponsored products on Amazon can actually help your product listing organic rankings. So upon launching your product, run PPC ads for a few weeks to increase your sales as well as organic product ranks. The only tip I can give you here is to keep track of how much you spend on ads. Many sellers make the mistake of bidding too high for a keyword that will cause cost overrun, leaving sellers in huge losses.
Take Care of Customers & Complaints
While Amazon takes care of customer supports, complaints, and returns & refunds (and you’re going to have a lot of them!), you can participate in building good customer relations with your customers as well. There is one simple thing you can do to take care of your customers. As mentioned previously, ratings and reviews are an important factor for the A9 algorithm and product listing ranking. So while Amazon does all the hard works dealing with customer complaints, you can directly reply to their reviews and comments on your product listings and answer their questions over there.
That’s it! Amazon FBA business is done, FINALLY! This is, without doubt, one of the best ideas you can turn into a business and make a fortune. It is certainly the hardest too. From the moment you start looking for a product to sell to the moment you make your first sale, it could take around 3 to 6 months.
After a year, if you try hard and do everything right, you can actually quit your regular 9-5 become a full-time FBA seller. But till then, you have to work as hard as you can, learn everything about such businesses, looking for new marketing strategies, and find new products to sell fast.
2. Start a Dropshipping e-Commerce Store
Another type of selling online is to start a dropshipping business. Like Amazon FBA where Amazon fulfills products from the point of order to delivery and support, dropshipping is the process of selling products manufactured and fulfilled by a third party and earn a commission per each sale.
As a business idea that can make you money this year, dropshipping is something that you can manage to do in line with your regular 9-5 job. While starting most businesses requires high budgets and planning, dropshipping is something you can do with low budgets.
The difference here is that you will require certain skills regarding online store management and development plus a good knowledge of running a website, online advertisement, and marketing. In general, a freelancer with certain skills regarding website development and a budget of $1,000 to $1,500 can start a dropshipping business.
To briefly explain the notion of dropshipping business, it is a form of selling online and earning commission for each sale. It’s somehow like affiliate marketing, but on a larger scale. In dropshipping, you find a supplier willing to dropship certain products. You do the marketing, attract customers, and make sales. After that, the supplier will receive the order and fulfill it and take care of customer support, returns, refunds, and complaints.
On a regular dropshipping business, you will earn 10% to 15% at first, but when your sales increase, the commission will go up as well. Top dropship business owners usually earn up to 51% per each sale, and that’s without doing the hard work.
The Business Plan
A dropshipping business plan is a lot simpler than many because the overall focus is on two things:
- Online Storefront
- Marketing Strategy
Actually, the focus is mostly on the second one. It is always marketing marketing marketing in dropshipping because the rest is on the suppliers’ end.
While you have to consider what to sell, who is going to fulfill the orders, shipping fees, and commission, you have to look into how to make an online store, how to manage it, and how to do the marketing. Besides, you will need to develop a brand for yourself; A brand that retails different products, like Walmart, but online. To sum up, your dropshipping business plan should cover the following subjects:
- The business name & the logo
It’s clear what is meant by business name and logo. If you are going to sell any kind of product in your store, then you can go with a general term for your company name, but if you are going to focus on certain products and categories of products, then choose a suitable name related to that.
- Startup Budget
The startup budget for a dropshipping business varies a lot. You might be able to go with $500 (although unlikely). The best suggestion for such businesses, in my experience with clients, is about $1,000 to $1,500 for a product less than $20. This budget is divided in to running a website, ordering some samples, supplier terms, and marketing.
- Products to sell
Your options in finding a product to sell are limited because you have to find a product that is available for dropshipping. That depends on the supplier of that specific product.
- Suppliers to fulfill orders
There are different kinds of suppliers for dropshipping businesses. While many dropshipping suppliers offer 0 to 100 fulfillment, some may only fulfill up to the point of delivery and not returns & refunds. This is not good, so you have to find suppliers who are going to take care of customer support too.
- Target markets & shipping fees
It is important to which country(s) you are going to sell your products to. This way, you can estimate the shipping fee and see if your potential customers are willing to pay for the shipping fees. Some markets may have higher shipping fees and taxes that you have to consider if you are going to sell in.
- Your commission
As mentioned before, you can start from 10% to 15% up to 25% and even more if you are really hard working with a lot of sales. This s up to your supplier as well as you. The supplier should be willing to pay up to 25% when your sales are higher than usual and you have to do hard to increase your sales.
If you are going to sell more than 5 it 10 products on your dropshipping store, then accounting and keep track of orders and commissions would be harder than it looks. Accounting and doing all the matches and reports for receiving your commission is going to be a time-consuming task, for which you may have to employ a professional accountant if your sales are more than 50 to 100 per day.
- Online store platform
There are a lot of ways to start an online store and an eCommerce website. You have to decide which platforms to use. You have to see if starting an online store from scratch is helping your business or going with already established ones like eBay, Etsy, or even Amazon could be better.
- Marketing strategy
Dropshipping business is all about marketing. The marketing strategies you employ to increase your sales and attract potential customers should be planned beforehand, and most of your business plan content for the dropshipping business is dedicated to marketing.
- Customer followups
While the supplier takes care of customers, you can use some customer relation tricks to assess the product you are selling, delivery time, and packaging quality by customer followups. The simplest strategy is to ask a buyer by email a few days after his/her order to rate your product and leave a comment. This will help you to reflect on the potential problems in the fulfillment process for a better customer experience.
Product & Supplier Research
A successful dropshipping business heavily depends on the supplier(s). The supplier is the one who ships out orders and takes care of customers’ complaints and returns. If you are doing your best to provide the best experience for your customers browsing your online shop and your supplier just ships poorly packaged low-quality items, then customers will hold you responsible, because they ordered on your website and trusted your business name and brand.
You have to choose which dropshipping supplier to work with carefully since they are going to be the physical face (product) of your online business. With the market filled with numerous scams and fraudulent suppliers, finding one who actually cares about your business, as well as theirs, is hard.
In this section, I’m going to talk about the characteristics of a good supplier, and a good product. Depending on your strategy to go with such business, you can either choose the product first and then seek out a supplier (bottom-up strategy) or the other way round (top-down strategy). Choosing the strategy depends on your business scale. Are you going to sell different types of products? Go with the bottom-up strategy. If you are going to sell specific categories, the top-down is more suitable for you.
A good product to sell by dropshipping should have certain:
- Large market
There should be a lot of demands for that product so you can have a lot of sales. There is an alternative too! If the product doesn’t have a large market, make sure it is a niche product that isn’t easily found. Although most dropshipping businesses go with large market products, niche products are good as well.
- Good profit margin
Profit margin is an important factor in selling online. Go with products with at least 10% to 15% commission and not less than $3. Anything less than that and you will lose money in marketing.
- Small and light
If your product is large and heavy, you should expect a shipping fee that is more than the product price. This is undesirable for your customers, so always choose products that are small and light to minimize shipping fees.
- Acceptable price range
The amount of money customers willing to pay online for a product depends on a lot of factors. If you are going to be solid for producing and choose something that people won’t hesitate to buy, go with something between $10 to $60 for regular products and $15 to $80 for niche market products.
- Not fragile
It is recommended to choose a product made with firm and unbreakable materials like wood, metal, or plastic. This is to minimize damage risk during shipping and minimize returns.
- Not seasonal
Seasonal products are only suitable for a specific period of time, like during a seasoned holiday. Unless your dropshipping business aims to offer a lot of products at once, don’t go with seasonal products.
- Not patented or copyrighted
Selling patented and copyrighted products is something you seriously want to avoid. It doesn’t worth the trouble!
All of the above depends on the supplier too. First of all, your supplier should be able to fulfill orders him/herself. The (s)he should be able to supply the desired products and ship them to your target market. You can find both products and suppliers for dropshipping on websites like Alibaba and AliExpress. A good reliable supplier to fulfill your orders and pays your cut should have certain characteristics.
- Good ratings & reviews from past sellers
On online marketplaces for suppliers and manufacturers, there is a section for each supplier that shows its ratings and reviews. Check them and see other sellers’ comments about the supplier before engaging in business with them.
- Offers good quality product
You want to sell high-quality products and your customers will buy from your store again if they had a good experience with the past orders. Suppliers’ product quality is important. Make sure to order a few samples before working with them to assess the quality of their goods.
- Offers good profit margins
The normal percentage for sellers in a dropshipping business, as mentioned before, is 10% to 15% in the beginning and up to 25% or more when sales are increasing. This totally depends on your supplier to offer such commissions. Suppliers who are more flexible with percentages, offering milestones to increase sellers cut are better to work with.
- Pays sellers commission on time
Being paid on time is important for you as a seller because marketing expenses aren’t cheap and you expect to pay them by selling more. Suppliers who pay on time are fallen from heaven. They are rare but they really exist. The only way to see if the seller pays on time is by working with him/her unless you know someone else working with the same supplier too and you can ask them about this.
- Have reasonable terms of business
A supplier with reasonable terms of business is what separates good ones from bad and sometimes fraudulent ones. Suppliers with strict terms like pre-ordering a large number, low percentage, or a supplier who lays down rules for online store and marketing is just a red flag. A good regular supplier may ask you to pre-order 20 to 100 items beforehand but never limits you in terms of the online store or marketing strategies.
- Have good & fast communication/support for sellers
Find a supplier who can communicate, preferably in English, good & fast. This is for two reasons. First, good communication means better customer support, and seconds, it is important to be able to talk to your supplier without any issue and deliver your requests and questions precisely. Since most of the suppliers for dropshipping businesses are from China, make sure they are communicating well in English before doing business with them.
- Deliver orders on time and intact
Delivering orders on time in one piece is something your customers really care about, and you should too as well. To see if your supplier delivers on time and undamaged, you can order some samples and see if it arrives on time, or you can do some mystery shopping from stores they already supply.
- Cares about customers
As a dropshipping supplier, they are responsible for all the customer supports and dealing with returns and refunds. You want your supplier to take care of your customers perfectly because otherwise, customers will lose trust in your brands instead of your suppliers.
You should seriously avoid suppliers that are anything but the above-mentioned. As I said before, there are a lot of scams on dropshipping business markets. A good way to ensure a supplier is trustworthy is to call them on the phone or have a face-to-face video meeting on Skype.
Setup an Online Store
To begin selling online, you will need a website or a platform to list your products for sale. You have three options for starting a dropshipping business and sell online. Depending on your product, category, sales velocity, and fulfillment process, you can choose the one that is right for you.
- Sell on online marketplaces
- Sell using online shop creators
- Starting an online store
Selling on online marketplaces means selling your products on already established online shops like Amazon, eBay, Etsy, etc. There are a lot of them on the internet available worldwide or locally. Depending on your target customers and markets, you can either sell on local online stores or international ones. The best marketplaces to sell your products by dropshipping are:
Each of them has its own rules and regulations for selling in general or dropshipping. You have to read them on their terms of service page. Also depending on the country of your residence, local options might be available for selling too, so check them as well. You can also sell on both at the same time. It might make marketing and accounting a little difficult, but you can increase the chance of being seen and get more orders and sales.
Using online shop creators to sell your products means using services that allow you to run a website and online shop with a few clicks. There are a lot of services available for you if you like everything done easily. The only disadvantages I see with such services are limitations in the case of SEO and marketing tools, otherwise, they are perfect. The services suitable for starting an online shop are:
And at last (and my favorite way) is to Start an Online Shop from the top. This means creating a website and integrate an online shop into it. This way, you have full control of everything; From marketing tools and SEO all the way to the theme of the store, looks, and many other customizations. The best choices for you if you want to start your own online shop are:
When this option is good for you? Whenever the scale of your businesses is larger than a few dropshipping products, you can think about running your own shop. Also starting a website and online shop is a bit more technical so you might have to hire some help. Learning WordPress, WooCommerce, and Magento isn’t difficult. No coding or programming is required since they are ready to install and use, but some technical knowledge of how a website is created and works is crucial if you want to do it all by yourself.
Promote Your Products & Marketing
The foundation of every dropshipping business’s success lies within its marketing strategies and quantity. I said before, and everyone who has experience in dropshipping knows, that marketing is the most important part of this business, and it has to be right in every way.
There are literally hundreds of marketing tools available online for you, but before using them, you have to increase your knowledge of marketing and online advertisement. If used incorrectly, marketing strategies will fail and leave you with the loss of your marketing budget. The strategy for marketing plays an important role in the success of the campaign you run to advertise your products on the internet.
To use marketing tools correctly and choose the correct strategy to run your advertisement campaign, you have to conduct a series of researches that include the followings:
- Market research, that gives you information about how certain markets attract customers and what categories are better accepted by customers in that specific market. It also provides crucial data regarding market capacity, customer retention, and lead generation.
- Target customer research, that provides sufficient information about how certain customers search for products online, and how they interact with advertisements.
- Keyword research, that gives you an insight into what words or phrases are used by customers to search for a required product/item. Keyword research will provide an important asset with which you can target specific users who search for a product similar to yours.
- Competitor research, that tells you how they are generating leads (customers) for their business, what marketing strategy and tools they are using, and what keywords they are targeting for their advertisement campaigns.
Provided you have enough data to run a marketing campaign, you will still need a strategy to follow. There are a lot of strategies for marketing and advertisement. You have to choose one (or more) and follow its instructions to start selling and making money. Some of the best marketing strategies that still work for dropshipping businesses are:
- Inbound Marketing
Inbound marketing is a set of marketing strategies that target the right customers and lead them to the website or online shop using informative content and posts. Content marketing and SEO optimization are the pillars of inbound marketing for dropshipping businesses. You can provide content (posts, video, text, and infographics) about your products, talking about their advantages and disadvantages. You can also ask others to thoroughly review your products and write them on their blog, or create a guest blog on a related website.
- Social Media Marketing
Social media marketing is the use of the power of social media platforms to promote your products and lead potential customers to your online store. The most powerful social media you can use are the common ones we all have accounts on. Instagram, Facebook, Twitter, Youtube, Pinterest, and many others are good ways to promote your products. You can also start challenges, giveaway discount coupons, and start a hashtag trend for your product or brand to generate more leads that end up buying from you.
- Influencer Marketing
Influencer marketing is usually working for private label products and brands that are selling their own products. For the dropshipping business, too, you can use such marketing strategies to generate some revenue via increasing sales. But since you are not selling your own products, and you are just an online shop, it’s better to ask an online influencer or internet celebrity to promote your online shop rather than a specific product. Of course, influencer marketing is not a suitable strategy in the early stages. Make sure you have plenty of products listed on your online shop before employing such strategies for marketing.
- Email Marketing
The oldest marketing strategy out there for promoting your product is email marketing. The concept is clear. You send emails to people and if they are interested, they will order your products. But, email marketing will require a lot of optimization and A/B testing to deliver perfect results. First of all, you should have an email list of people who might be interested in buying products like yours to increase the conversion rate. Second, you need to include a fantastic copy in your email body to attract potential customers; To make them want to click on the link, visit your online shop, and order your products. And third, emails must be sent via an email marketing service like Mailchimp to make sure your emails are delivered to users’ inboxes, and not to their spam folders.
- Paid Advertisement
The most successful form of marketing is paid advertisement and search engine marketing. This form of PPC ads appears on the top of the search results page when a user searches for certain keywords. PPC stands for pay per click and every time someone clicks on your ad, you have to pay for that. The paid advertisement comes in a variety of forms that fit every kind of budget. The best services for paid ads are Google Adwords and Facebook Ads but there are other services too that provide wide-scale advertisement on different related websites and blogs.
- Guerilla Marketing
Last but not least is guerilla marketing. This is a form of massive advertisement and the employment of multiple marketing strategies to promote a product or service in a short period of time. What guerilla marketing does is to promote your products everywhere, in a way that people will see your products, ads, brand, and logo. This includes all popular social media, video sharing platforms, forums, websites, search results ads, banner ads, etc. This marketing strategy is quite costly but is a perfect way to promote something in a very short time.
In common types of dropshipping business, customer supports, and dealing with returns & refunds is on suppliers’ end. This means you don’t need to worry about complaints and issues with deliveries or products. But since customers order from your website/online store, then they will eventually stop purchasing from you if they have a bad experience with customer support.
To overcome this problem, and to identify any issues during the fulfillment process, make sure you provide a rating and comment section for each product on your website. When a customer orders something, then send them an email a few days to a week later asking them to rate and review the product, shipping, packaging, etc. This small gesture will provide a lot of important data that can help you identify all issues and discuss them with your supplier.
There are a lot of services that will send out emails automatically after a period of time when a customer order a product. They are categorized in CRM services and software (Customer Relation Management) and they greatly help you keep in touch with your customers, know what they want, and identify any potential issue. This also provides a much better experience for customers when they see how much you care about them. Don’t forget that a satisfied customer will come back with more orders.
Dropshipping is actually a very promising business model and it’s generally less risky than Amazon FBA or any other type of online retail. Because you don’t own any product to sell and you only work on commission or referral fee, then it would be easy to work on as many products as you can manage in your store. While the profit margin is lower, you can list more products and sell to a wider range of customers online.
Usually, for a dropshipping business, it will take about 3 months from the moment you choose a product to the moment you make your first sale and 6 months to return your initial budget and marketing investments. Depending on the number of products and variety of their categories, it might a year for dropshipping businesses to make a stable income. It is not an easy way to make money, but unlike common Ways to Make Money Online, this can generate income without doing much.
3. Develop an App
Developing an app, as the title is clearly obvious, is about making an app that people can install and use on their smartphones. It’s a simple idea but requires more than it looks. If you have ever used a smartphone and searched Android or Apple app stores, you’ve realized that there is at least one app for anything that you can imagine. The market is large and it always looks for newcomers to publish something people want to use.
If you are not interested in selling online and managing an online store, then this one could be one of those business ideas you might like. Developing an app is one of the best business ideas if you are going to start with a small budget. Although developing an app from scratch can cost thousands of dollars, but for smaller projects and simpler apps, there are cheaper alternatives that I will talk about. Let’s just consider app development one of the low-budget business ideas.
Developing an app is only for smartphones. We have something called SaaS (Software as a Service) which is basically web apps used for specific tasks that more professionals use for different purposes. Like all those online keyword research tools, backlink check services, and data-providing web apps you might have used before. Both developing an app and starting SaaS have the same basics regarding business plans, proposals, budget, marketing, etc. So if you get yourself acquainted with app development, the path is roughly the same for SaaS too.
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The Business Plan
Like every business, app development begins with designing a comprehensive business plan. The fundamentals are the same, like how much budget is required, what is the pipeline, target users, marketing, required knowledge & resources.
The first step toward creating a business plan for your app development, if you are going to look at it as a legitimate business, begins with extensive research into areas where people might need an app for or any trends that can bring you more users and income in a short time.
Basically, an app business plan should include the following items:
- App Proposal (what should the app do for users)
- Budget Estimation (how much money is required to get things done)
- Monetization Plan (a.k.a. business model explaining how app generates revenue)
- Requirements (developers, knowledge, tools, resource, APIs, etc.)
- User Interface (UI or overall looks of the app and its content)
- The Process of Development
- Publishing the App (submit on app stores for users to find and install)
- Marketing (promoting the app to get more users)
- Support & Maintenance
We will cover all of these items one by one, but the fact is that you might need additional sections in your business plan depending on what app you are developing and what it does for users. In other words, the items above are the basics for every kind of app project, but the nature of app development is not something that can be followed by a fixed formula. Most of the work will appear as you move forward!
The first step in creating a business plan is to write an app proposal. In simple words, an app proposal concerns what the app does and how users can make the best out of it. For example, a To-do List app helps users keep track of their daily tasks or an entertainment app (game) helps people have some fun playing some game. It’s simple! You have to determine what kind of app do you want to put out there and how it can make people want to install & use it.
To make an app proposal, first, you have to do some research. If you have a category in mind, then go with that, but if you have no idea, then take a look at current trends on app stores (Google Play Store & App Store) to see what kind of apps are more popular.
If you are going with a regular app, then such researches and data directly from app stores are sufficient to make a decision. Regular apps are easier and cheaper to develop, can be promoted fast with most marketing strategies, and make good revenue. What is good about developing a regular app is that you can get things done with one app and move to another, thus enabling you to earn more money from multiple apps at the same time.
Many people do this since it’s a good strategy to make good money without working too much. A friend of mine currently published 11 apps, making roughly $6,000 per month from ad revenue. All of them are apps that are simple and didn’t require too much work, support, and maintenance.
On the other hand, if you are going to explore niche markets, then you require more extensive research, both inside and outside of app stores. They usually require more work, resources, and budget, but will generate much more revenue in return.
An app in the niche market is harder to find since there are millions of apps already flooded the market. What you should do is to find those areas that are either untouched by other app developers or those that are not competitive while demands are high. Also, you can look for areas that are considered a rising trend, meaning they are a few steps away from becoming the trend of the day, like taxi booking apps that exploded back in 2009 – 2010. Uber launched its app, something new for the market, and many followed and succeed.
To sum up, it depends on you, your creativity, and your budget to go short-term with multiple regular apps, starting with one and develop others using the revenue of the preceding ones, or go long-term and focus on one app in a niche market where you can make an impact by introducing something new to the world of smartphone apps.
But don’t forget ideas should come first, and if you have a really good idea that can be impactful, then go for it, even if you don’t have the budget. There are a lot of local & international startup accelerator companies willing to hear your ideas and invest in them. If you have that super idea in your mind, make a kickass proposal and present it in front of big startup investors in different meetings and conferences. In this case, you really need to try hard in the beginning, because there is a bright future just over the horizon.
Estimating a budget for developing an app depends heavily on what kind of app you are going to develop and what marketing strategies you are going to use to promote your app. Really it’s hard to say how much money you will need exactly because there might be many hidden costs along the way for each developer and each app. The universally accepted answer is the “more the better”, but it’s not the case 98% of the times.
As a rough estimate, developing a regular app from an already existing template, without using any paid APIs or expensive resources can vary from $600 to $2,000 in the beginning and maybe $10 to $100 monthly fee for supports and maintenance. The lowest estimate is $600 which is divided into the following expenses
- Buying an app template: $50
- Customizing and developing the app: $200
- APIs, resource, etc.: $50
- Publishing app: $150
- Marketing: $150
This is really a rough estimate and the lowest budget required to develop a simple app as far as I know. This is actually the budget one of my friends had to develop a simple Notepad app. He monetized his app by showing ads and selling a premium ads-free version that had extra features like styling, fonts, image insertion, etc. It was a good project and for $600 it actually worked out pretty well.
To estimate the budget for bigger app projects, of course, more research and analysis is required. It obviously costs more to develop an app that didn’t exist before, because you have to develop everything from scratch, and this alone costs a fortune. It is really hard to put a number there and call that budget estimation because niche apps tend to encounter barriers during development where there are a lot of hidden and unexpected costs. One of them is requiring external resources like APIs from different services and data providers.
I really don’t know any minimum estimate, but I know developing an app from zero will require something between $2,000 t0 $5,000 per month usually per developer. This is beside external resource and API costs. Also, the overall structure of the service you’re going to provide by the app can influence the budget A LOT. A scooter rental app startup here in Turkey (MARTI) started with $2 million domestic and foreign investment in 2018, followed by a $25 million investment fund from Insider in 2020 (source) for business expansion.
Now, how can you estimate your budget? Excellent question! While predicting the exact number is technically impossible, estimation requires a lot of research among the current data you can find on different sources online, including app stores, companies & developers’ websites, CrunchBase website, public domain financial data, startup companies’ data, etc. Also considering workforce wagers for developers, programmers, marketing agents, etc is important since a lot of the budget should be dedicated to human resources. Other costs like external resources & services of any kind should be considered as well.
The Business Model & Monetization
The goal of every business is to make money. Every app there is, even if it’s free, is making money based on a business model. Every app, online service, social network, website, etc. have some form of monetization because, without it, the owner will go bankrupt in a matter of weeks. You want to develop an app to make money, right? Yes!
There are more than 50 different business models enabling owners & entrepreneurs to monetize their businesses. Fifty business models surely are a handful but only a few are applicable for app development. The top 5 popular business models most apps use to make money are:
- In-app Advertising
Simples and the most popular business model for apps is the advertisement in the app. If you use a free app that shows a small ad banner on the bottom of the screen, that’s it. This could be by integrating advertisement codes directly from Google AdMob or showing sponsored ads, where users have to perform a series of in-app tasks to claim a reward. In-app advertising is by far the simplest and easiest way to monetize your app. Such business models don’t require too much maintenance so you can develop multiple apps and generate revenue by showing ads in all of them.
- In-app Purchase
This business model actually turning your app into a sales channel, but it’s not only for eCommerce businesses and online shops. This model is good for selling physical goods or digital media via an app, but you can also use it to monetize games. There is a feature called Pay-to-Win on multiplayer games where players spend a few bucks to buy game money and purchase in-game items using that. If you are not interested in selling physical or digital goods, then this business model is good for monetizing games if you are planning to roll out one.
Freemium (Free & Premium) is also a popular business model for monetizing apps. Apps that offering several features usually divide features into two groups. Features are those that come with the app for free, and those, which are usually more professional and better, that come at a cost. If users want to have those features too, then they have to pay a fee to unlock them.
The subscription business model is like freemium, premium contents & services are only available to paid users. This could be more professional content like articles, videos, images, or data as well as services like cloud storage or streaming service use a subscription business model for monetization. The app usually comes with mainstream content free of charge but users who are willing to pay a monthly fee can have access to premium content.
- Paid App
Paid apps are those that you have to pay money to download and install. Such apps usually come in two separate free and pro versions which you have to pay to install the pro one. The free version usually has very limited features with ads and the paid version comes as a complete software package. Such apps usually for professional use suck as professional image & video editors, cryptocurrency exchange apps, company-specific apps, etc.
Depending on the nature of your app, you have to decide which one is better for you. In general, advertisement is a proven way of making money from apps. In-app purchase is good for games where players literally pay to win by buying game coins to purchase in-game items. Freemium is good for text/image editors where premium features are only available for paid users. Subscription is generally good for news and educational apps where extra contents are available for those who pay a fee. It is also good for online services like cloud storage apps. And at last, Paid App is good for apps providing special features, content, and services that cannot be found for free.
You can also combine two (or more) business models to monetize your app. A good idea would be combining advertisement with freemium or subscription. The app is free but with ads and if users want more features plus removing ads, then they can pay. There are also apps where you just pay to remove ads altogether, like many news bulletin apps where for every paragraph you read, you have to watch a 10-second ad in order to continue reading.
Developing an app requires different kinds of resources. Most of the apps you have on your smartphone, especially those requiring the internet to work, usually recall different resources from different online service providers to work correctly. For example, an app like Uber that has a map and use of GPS service, use Google Map API to location service. That map actually comes from Google servers, and Uber didn’t bother to make that all from scratch.
The backbone of a good and popular app builds upon many codes and sub-programs that are not integrated but recalled from the provider whenever required. Most of the resources an app use are in form of APIs (Application Programming Interface). They are a set of codes and data provided by a company as an online service (e.g. Google Maps, real-time charts & data, newsfeeds, etc.) and used by developers for integrating into apps.
Such services and data are really technical stuff app developers know much better. If you are not a developer yourself, then leave it to the professionals. Speaking of developers, since developing apps require extensive knowledge of programming and coding plus UI design (I’ll explain later), you might need one.
If you or your teammates aren’t developers, then hire one to do the job according to your needs. Since learning how to code and develop an app is not something you can do in, let’s say, two weeks, consider hiring a developer (or a team) to make you an app. And remember, if you are going for a long-term project and a niche market app, then hire developers you trust the most and they will stay along with the project. Many senior app developers for big companies usually have a percentage of share and are considered key members of the project.
Design User Interface (UI)
The next step is designing the overall looks of your app. Smartphone apps, usually, have two ends. There is a backend, where there is an administration panel with all the tools to tweak the app. This is only accessed by you. The other end is called the frontend, which is what users see and it’s the general looks of your app. You have to design the frontend, which for apps is called UI or user interface.
UI design is not a simple job. There are a lot of tricks and techniques that professionals know. A professional UI designer knows how to set up app pages, where to put the buttons, how to combine colors, and many other things that make an app interesting for users. This is a job that you have to hire a professional for because you don’t want your app to look like a website from the early 2000s.
Designing UI comes before starting the development before developers start coding. What you have to do is to prepare (or draw) how the app should look like, what pages are required, and what contents should go on pages. Provide UI designers with your vague ideas about your desired app, tell them about the app, and let them do their magical work. Even if you are not sure what you want, set up a meeting with your UI designer, and (s)he will do the rest.
When the UI designer starts working on your project, (s)he will constantly updates you with the project, asking about your preferences along the way. In the end, you will be provided with the exact look of your apps including all of the pages and the connections between them. Usually, UI designers provide you with an app icon as well, which will be necessary for the final stage of developing and publishing the app.
When UI is done, the developers start coding and creating the app. The process of designing the user interface, depending on how many screens or pages your app has and how many graphics are included, may take up to a month, during which the designer contacts you frequently to ask a few questions and know about your preferences regarding the overall design criteria of the app. This is, of course, much longer if you are developing a game for smartphones.
Developing The App
When the UI and the overall looks of the app are ready, your developer(s) start coding your app. This is the stage that your app, which has been just shapes and pictures, will receive a purpose and will be practical. This process is usually a lengthy one, but it depends on the app’s functionality and complexity. It also depends on your approach to the development (starting from scratch or using a template) and how many developers are coding for your project.
It is hard to say how long does it take for your developers to finish your app. It usually takes longer if you are developing everything from scratch. The minimum amount of time that I’ve seen for an app to complete was 2 months, but that was just a simple app with a few functionalities. Also, don’t forget that you need two versions, one for Android, and one for iOS. You can add an additional version for Windows phones or other smartphones OS.
When you’re done and the app is ready, don’t rush into publishing it for public use. Developers have to test & debug the app, and this stage usually takes as long as the coding stage, if not longer than that. Testing is an intricate stage and has to take care of properly. While many developers are going to test the app by themselves or members of the team, many go with a limited alpha or beta release, so many people can use it, while data are sent back to developers’ end to identify issues & bugs and debug them.
There are a lot of public user testing platforms you can use. By publishing your app on websites like UserTesting, Userlytics, and TestBirds, you can have a lot of people test your app while your developers are fixing potential issues. This is by far the fastest and cheapest way to test and debug your apps, but not all apps require this level of debugging.
This whole debug thing is usually for really complex apps with many pages and screens offering users a lot of services and opportunities. It is also a good idea if you want to test your smartphone game, but not a good way if your app is as simple as a training app or a photo editor. Don’t bother with simple apps, because an experienced developer knows how to code them without any serious bugs.
Publishing The App
When your app is ready and debugging and testing is finished, then congratulations! You are now ready to publish your app on different app stores for different smartphones. The main two app stores you have to publish your app on are Google Play Store and Apple App Store. If your app has a Windows phone version, then make sure to publish it on Microsoft Store. The most popular ones are Google Play Store and Apple App Store so we stick to them for this section. The basics, however, will be the same for publishing on other platforms and app stores.
First of all, let’s talk about Google. To publish your app on Play Store, then you have to pay a one-time $25. This is the fee for a developer account on Play Console. There will be a process of identity verification and stuff like that but in the end, you will be able to submit an app on Google Play Store. Before submitting your app, make sure you read the Google Play Developer Distribution Agreement as well as Play Console Terms of Service, you know, just in case!
Submitting an app on Apple App Store is not so different from Play Store, but it’s a bit more complicated and there are more rules and regulations regarding App Store Review Guidelines. Also creating a Developer Account for App Store costs $99 per year. To Submit an App for iOS you have to follow a lot of guidelines that Apple provided for you. This is applicable for coding and SDKs (Software Development Kit).
In general, submitting and publishing an app could be a little complicated. It has its own tricks and secrets. But don’t worry because all app developers are familiar with this process, and will do the job for you. After all, they are a part of your team and they are the only ones who have the experience. So don’t bother yourself with publishing the app and focus on app listing SEO optimization.
Everything online comes back at optimization if your goal is to be seen by others. Websites, videos, product listings, channels, and all others require SEO optimization. App listings on any app store won’t be an exception. They need SEO optimization too. Before starting SEO optimization and create a perfect app listing, you have to conduct competitor and keyword research beforehand. Look what your competitors are doing with their listing and get some ideas to start. Prepare a list of keywords to use (both short and long-tail keywords) and find what designs and colors are better for your images and videos on the app listing.
Most app listings have 5 main sections (plus an extra as a bonus) you have to optimize:
- App Name (Title)
The first thing that users see on your app listing is the name a.k.a. the title. This is usually limited to 100 to 150 characters on app stores and it is a perfect place to use some keywords. Even if your app name contains some keywords, it could be a lot better. But you don’t need to name your app after a keyword. Name it after what you like, but when you are creating an app listing, make sure to use some keywords after the name. For example, if your app name is “MyAPP” then you can write the title like this: MyAPP – The Best Image & 4K Video Editor – Supports Popular all Formats JPG, PNG, Mp4, etc. (92 Characters)
- App Icon
The app icon is the other thing that users see next to your app name. The app icon should have an interesting design that attracts users into installing your app. App icons are usually designed by UI designers and they will tell you why it is designed this way. There are certain design criteria that many big company logos follow, and it would be a good idea if your designer employs the same criteria to roll out a great app icon. The appropriate size for your app icon on the app listing should 1024×1024 pixels.
- Images & Videos
App stores have a section where you can add some images (screenshots) and videos of your app. They should be noticeable enough to attract users and make them scroll down to read the description, which is the next section of the app listing we are going to talk about. Most of your efforts should be put on the first three to five images because they are the ones that are shown on your listing by default before users scroll for more pictures and videos. Try to include screenshots of your app’s main screens and add a short attractive copy (up to 5 words) to grab the attention. Images and videos are most effective for smartphone games, showing all the cool graphics and features, but they still play an important role in other apps too.
The description is the section of an app listing where you are going to describe what your app does for users who installed it. This is a great place to include some keywords and answer some questions your app helps to answer. There is a limited number of characters for this section (between 2,000 to 5,000) and you have to use every single of them wisely to SEO optimize your app listing. The general structure for app description begins with a short introduction of the app, followed by its key features. Then you have to add some questions that your app can be the answer for. For example, if people are searching for “how to edit 4K video?” then your app can provide a good 4K video editor, thus answering this question. At the bottom of the description, add some update-related details and changelogs. This part should be edited every time you submit a new updated version. In general, a description is a great place to add as many keywords, either short keywords or long-tail keywords, for your app listing.
- Ratings & Reviews
The next and the last section of your app listing is ratings & reviews. This is the place where your user will rate your app or leave a comment explaining why they liked (or don’t like) your app. First of all, make sure you encourage your user to rate your app on the app store and leave a review. This can be done by showing a pop-up a few days after they installed your app. This way, you can gain more reviews and have higher ratings that affect your search result ranking on the app store. Also, this could be a great place where you can identify issues with your app and see what people liked or don’t like about it, since people usually write their actual opinion about the app. Using such data gives you the insight to provide better service and user-friendlier apps.
- (Bonus) Voice Search Optimization.
Voice search is a new way of searching the web and according to Think with Google, direct search data from Google indicates that 27% of the global online population is using voice search on mobile in 2018. That is a staggering number and since it is on mobile devices and your business is app development, they are a perfect match. The key to achieving a rank on voice search is to use perfect grammar and long-tail keywords since most of the phrases searched by voice are focused on them. One good example is those questions you include on your app listing. They should be common questions people are searching for to find an app capable of answering them.
Also, your app listing optimization should not only be in English but also in different languages, especially for your target population. If you are creating an app for a local region, then you have to SEO optimize your app listing in the local language too. This helps a lot considering Google ranks local results higher than others. For example, if you search for online taxi booking apps when you are in Turkey, the first result will be BiTaksi, since it is a local alternative to Uber.
And one more thing. Keep your app updated every few days or week depending on the size of your users. Roll out new updates, new features, fresh contents, newer looks, etc., and change app listing elements with each update as well. Treat your listings as a live piece of your app, so keep editing it every time you update and add update logs to your description. Search engines will notice how frequently you update your app and listing. This is an indicator for them that you are caring about the quality of your app, so they give you higher rankings on search results.
Like every business, app development requires marketing too. Without employing a good marketing strategy, nobody will know your app exists. Common marketing strategies for promoting your app isn’t something different. There are a number of strategies available:
- Paid Advertisements
The first and the best way of promoting your app is running an advertisement campaign. You can use different advertising networks like Google AdWords to advertise your app listing on Google search result page, on Google AdMob network, or Google Play Store. Apple has Searchads for promoting your app on App Store too. Such paid advertisements are keyword-based that you can either set manually or automatically. Paid advertisements have the best ROI (Return on Investment) compared to other forms of marketing when it comes to promoting an app.
- Inbound Marketing
Inbound marketing is a strategy to lead users directly to your desired destination (in this case app listing). Besides SEO optimizing your app listing, it is recommended to create a website for your app too (if you are developing a niche market app) and work on its SEO optimization as well. This way you can employ this strategy to organically rank your website on Google search results for related keywords and promote your app over there by including a download link or a QR code leading to app store listing.
- Social Network Marketing
The power of social network sites goes beyond just sharing funny quotes, cat pictures, and food images. You can use social media and network for free to publish content and promote your app. This is a marketing strategy that you can handle yourself, but if you want to become a trend fast and see some good results, employ a professional social network or digital marketer. They know some tricks and secrets that can give your posts more impressions and clicks leading to your app installation page.
- Influencer Marketing
Influencer marketing is a good strategy for promoting apps too. You can find a few influencers on Instagram, Twitter, YouTube, or on different related websites and ask them to talk about your app and review it. This is a good form of app promotion and a good strategy to launch your app and have many users install it in a very short time. But influencer marketing is usually a costly solution, but if you got the budget, it’s a good idea to get everything going. If you employ this strategy for marketing, make sure your influencer (either person or website) is related to whatever your app does. If the target followers of your influencer are interested in related subjects, you see a surge in installs and active users, which will result in a good ROI.
- Push Notification Marketing
Push notification marketing is like email marketing, but instead of emails, you send out notifications on many users’ smartphones. This is done by using mobile advertisement networks like PropellerAds and it gives you a good chance of having a lot of users installing your app on their phones. One good thing about such advertisements (including Google Adwords that I explained a few paragraphs above) is that you can specifically target users based on their location, age, gender, preferences, and device model. This will help you reach more audiences/users who are just right for your ad campaigns. It also saves a lot of marketing budget since y just send out push notifications (or ads) for the right group of people.
Maintenance & Support
Maintenance and support are two subjects that require constant work, especially if you are focusing on a single niche market app or a game. Maintenance refers to constantly update the app, fix bugs, add new features, and change looks & style. You can dedicate a section in your app for users to report issues and problems so you can solve them easier & faster. Also, constant updates are a good way to tell app store search engines that you are trying hard to improve your app, fix bugs, and deal with security issues. This helps your users’ satisfaction as well as search result ranking on app stores.
Support refers to dealing with user-submitted questions either via the app or via store comments & reviews. Always interact with your users by answering their questions and solving their problems. This will gain your customers’ trust in your app and brand. Replying to comments on app stores is also a good indicator for search engines and can take you higher on the search results page.
That was for the app development; Another perfect idea to start an online business and make money. There are a lot of extra efforts required to developing an app, but since there is no clear and fixed road map for developing all sorts of apps, this Ultimate Guide gave you a good insight into how such businesses start and go forward.
Depending on how complex your app is and how many developers and designers are working simultaneously, your development could be done in 3 to 5 months. If you are developing your app from a template, it is considerably shorter and might be even done in a month. The overall time it takes to make a profit is about 2 to 4 months after publish, provided your marketing strategy is suitable and consistent.
In general, you can make money by developing apps in two ways. First, you can develop multiple simple and regular apps and make money by showing ads, and second, you can focus on one app in a niche market and try to be the best among your competitors. Both have good potentials in bringing good revenue. The former is cheaper to run and faster to bring revenue, but profit is smaller compared to the latter, which could take much longer to get results but bring huge amounts if everything is done right.
That’s it, and it was a quite serious “That’s it” because you have just read a really long article about the best ideas to start an online business. You are now ready to become an Amazon FBA seller, start a dropshipping online store, and developing an app, and make money from it. Now, it depends on you which one to choose by evaluating your skills, knowledge, passion, and budget.
In this Ultimate Guide, I’ve explained everything you need to know on starting such businesses, and I went into some important details not many bloggers and business owners dear to say because they don’t want ore competitors. So, if you didn’t pay attention while reading, I really suggest you go through them all or a section you want once more to learn everything there is to start an online business.
And as always, I am looking to hear from you in the comment section. Please tell me in the comments which idea did you choose to start a business? Is it Amazon FBA, dropshipping, or app development? Also if you have any business ideas that can be fit in this article, write them down in the comment section so I can add them to the list.
If you have any questions, suggestions, or recommendations, feel free to leave a comment and I will answer as soon as possible.
Thanks and good luck!