Many businesses today could consider themselves an “internet business”. Any business that has an online presence or uses the web to perform vital business functions is essentially a type of internet business. This can mean a business simply utilizes the internet for email communication and hosting a website or it could mean that the business is entirely online, without a physical presence such as a shop or office. What is an internet based business? The answer isn’t a simple one.
Uses of the Internet in Business
Nowadays, a business with absolutely no internet presence may as well have no presence at all. Many potential customers will use sites and apps like Yelp, Google, Trip Advisor, and Facebook to find businesses. They may learn about business from a friend, from TV or radio advertisements, or from billboards, but most people will look online to research the company. If they hear a radio ad for a new hair salon but can’t find a website to look through services the salon offers or find a Yelp page to look at reviews, the chances of them going to the salon are low.
The internet can be utilized by any business in a variety of ways. Having a website is the bare minimum. People don’t want to have to call you to get your business hours and they don’t want to have to find a business card or look through a phone book to get your number in the first place!
Anything that can be answered quickly, such as your hours of operation, the services you do, your phone number and address, etc. should be on a website so that customers can find the information quickly. You will also want to have an email address people can use to contact you. Not everyone likes to use the telephone.
Internet-based businesses also utilize various sites for marketing purposes. Social media sites like Instagram, Facebook, and Twitter can be used by businesses to connect with potential customers and keep current customers engaged. It’s one thing to have photos of your projects up on your website.
If you also make daily Instagram posts with work in progress photos, videos of your team, completed projects, and other interesting aspects of your business, you are going to have better customer engagement. Internet-based businesses understand how to reach their customers online and how to keep them coming back.
E-Business Models
There are different e-business models companies can use when they go online. These are similar to regular business models but, obviously, they take the online aspect into consideration.
One e-business model to think about is a revenue model. You need to know how your business is going to generate revenue and what potential sources you are going to go after. New businesses need to think about this but so do businesses who don’t have a pre-established online presence.
You pursue customers and revenue sources differently online than you do in person. If your business is entirely online, you may have less overhead in some areas but you also may have to work harder so that people can find you. Carefully research your target audience, the cost of the products or services you sell, and what avenues you can go down when selling them online.
You will also want to think about e-commerce. This is essentially how funds are transferred and how products/services are traded using the internet. It also involves things like internet marketing and inventory management systems. To be a successful online business, you have to have a way of allowing your customers to pay for their goods online.
You need an easy way to automate the ordering process and ways to keep track of your inventory, especially if you outsource the actual creation of the products you sell. Internet-based businesses also have to think about the security of the transactions they process. Nobody wants to be the cause of a massive security breach involving the credit card information of their customers, for example.
Entirely Online Businesses
If your answer to what is an internet-based business is that it’s an online-only business, you would be partially correct. There are pros and cons to conducting business entirely online, both from a customer’s perspective and the business’ itself. Nowadays, it is quick and easy to set up a business online. People do it all the time but not everyone does it successfully.
If you are the owner of an online business, one pro is the freedom you have to work when you want. Your employees also have this freedom. Because online shops are open 24/7, you don’t have to stick to a set 9-5 schedule. You can work around the orders you receive.
If you perform a service such as consulting, you can choose the hours you want to work. There is a lot of flexibility with online businesses. People who write or make art online can work whatever hours they want and choose how many clients they take on at any given time. People who sell physical products can decide to work on them in the middle of the night or over a weekend if they want to.
Another pro is that there is little money needed to start a small online business. You can start a blog or a job as a freelancer for free, any time you want. Even if you make physical products, like clothing or furniture, you don’t have to pay for a lot of overhead costs businesses typically need, like renting an office space or creating large amounts of products up front.
Typically, you just create an online portfolio of work you’ve done in the past and make products to order after you’ve already been paid. This cuts down on a lot of the costs associated with buying supplies before you receive any orders.
One of the biggest pros of an online business is that you aren’t confined to a certain geographic region. You can do business consultations with a business in Australia from the U.S.A. A customer from Japan can find your Canada-based jewelry business and place an order. Small, locally owned businesses with no online presence don’t have the global reach you get with an online shop.
On the other hand, an online business can be isolating in many ways. If you are working alone, you can’t enjoy some of the benefits of interacting with coworkers. You may feel like your social life is declining or like you don’t get enough human interaction. You will obviously communicate with customers frequently and anyone who helps you with your online business but at the end of the day, if you don’t have a physical office space, you’re working all by yourself.
Which Is Better? Online Store vs. Brick-And-Mortar Shop
The answer, honestly, is that many successful businesses have both a physical shop and an online presence, if not an entire online store. A good example of this is a global company like H&M. They have physical clothing shops all around the world but they also have a large online shop. Some products are even exclusive to their website, giving customers an incentive to shop online.
This is a great business model. Potential customers may pass by their stores in a rush but be able to go online later and check them out. If a store doesn’t have a product in the size they are looking for, they can get it online. The online shop will also come up in Google searches performed by people looking for dresses or business slacks or any number of clothing items.
Online-only shops have to do a lot of advertising online in order to be found. Brick-and-mortar shops may just be found by walking down the street and happening upon them. That doesn’t mean that physical shops have the advantage, though. Online stores may be able to offer more competitive pricing due to the lack of overhead. A physical shop in a remote location may not benefit from foot traffic and have to branch out to advertise and actually be found by customers.
The best way to conduct business for many people is to be an internet based business with a physical shop or a physical shop with an online presence. There are many avenues you can go down online in regards to advertising and customer engagement that you just can’t get offline. Shops like clothing shops also benefit from having physical stores because people can try on the clothes and inspect the products before they actually buy them. There are advantages to both.
Conducting Business Online
What is an internet based business? Any company that conducts business online can consider themselves an internet-based business, there are just different degrees to which a company operates online. An internet based business may have a physical office or shop but conduct the majority of their business online. They may have no physical shop at all.
An internet based business may also simply use the web as a way of advertising and interacting with customers while selling all of their goods and services in person and not online. There are many things to take into account when conducting business online, such as payment methods, the security of those payment methods, how customers can reach you, and how to keep track of inventory. At the end of the day, the majority of businesses going forward are most likely going to be at least partially online. It is important to think about what this means for you and your business.