Want to start an online business? Here’s 5 profitable ideas you can start this year.
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There are so many ways to make money online.
Whether you want a full-time online business, or a part-time side hustle, the abundance of money-making opportunities online is only growing bigger. This is good news for you!
Let’s look at 5 online business ideas you can dive into this 2020, and why they’re so profitable.
Online business idea 1) Make money on Etsy.
A lot of people have heard of selling on eBay or Amazon, but selling on Etsy can be just as profitable.
With more than 35 million buyers, Etsy offers you the opportunity to put your products in front of a global audience.
The way it works is simple. Similar to Amazon, people visit Etsy to search for products they’re interested in buying. These products are sold by third-party sellers who have their own virtual shop inside of Etsy that people can visit and purchase from.
Despite Etsy’s focus being on selling quirky, individual, handcrafted items, you aren’t limited in what product category to sell in. From jewellery and accessories to clothing and shoes, you’re spoilt for choice in what niche you’d like to build your shop around.
And, unlike Amazon or eBay, this destination website has positioned itself as a premium online shopping experience. This means that you can sell items for a higher price and reap larger profits. In fact, on average, t-shirts sell for 50-100% higher compared to those sold on eBay.
Once you’ve opened your Etsy store, the next step is learning how to sell.
There are many strategies people use to sell their own products. Some people handcraft and ship their own products from home. Others leverage suppliers to create their own products.
Either way, there are certain methods that are more beginner-friendly and profitable than others. Let’s have a look at the two.
Method 1) Digital downloads
This involves selling digital mock-ups that online sellers can use to market their own products.
A mock-up is a photo of a blank t-shirt that sellers can place their t-shirt designs onto and use for marketing.
They can be used as templates you can place for sale inside of your Etsy store. And, at the moment, these small digital files are super high in demand.
Best of all, getting your hands on these designs isn’t a hard job. With the help of Fiverr, a freelance where you can hire designers to complete your projects, you can have these digital mock-ups created quickly and efficiently. And convert them into healthy profits.
Method 2) Print on Demand
On the other hand, you may prefer to run a full-fledged Print on Demand store.
This is a method whereby you print a design onto a t-shirt and ship it to your customer.
The big advantage here is, t-shirts you sell aren’t printed and fulfilled, until after a customer has paid for it.
So, what does this mean for you? It means that your start-up costs will be very low, because you don’t need to spend money on inventory or storage space.
Essentially, you are selling custom made merchandise before it exists.
How are orders fulfilled?
Once an order is placed, you can pay a production service (for example, Printify), to print your design onto a t-shirt, and ship it to your customer on your behalf.
Once you’ve paid for your t-shirt, you keep the difference in profit.
Print on demand stores have flourished on Etsy for two reasons.
First, you can increases prices, which means higher profit margins. Second, Etsy has a great feature that allows you to integrate your store with Print on Demand apps, such as Printify and Printful. You can manage all your orders in one place, making it super easy to work your way around fulfilling orders as a beginner.
Overall, Etsy is a lucrative market to profit from—especially as a beginner. Whether it’s digital downloads you’re interested in, or a print on demand store, these are both profitable methods that you can test yourself.
Online business idea 2) Start your own Print on Demand store.
Why should you build a Print on Demand store on your own website, rather than on Etsy? Because you can control the customer’s journey.
You’re in control of your ads. You’re in control of how your website looks. You’re in control of how many upsells you want to feature. And once they’re on your email list, you’re in control over how you market to them.
Etsy, however, has more boundaries. Not only are you limited from all the above, but remember that you are a third-part seller on somebody else’s platform. So are always limited in some way or another in how you operate your business.
Likewise, your own online store offers comes with the opportunity to market to global audiences, with platforms like Facebook and Instagram.
On here, you can showcase your items to a global audience. There’s over one billion users on Facebook, so no shortage of an audience to market your products to. The question is, how?
One thing to keep in mind is that not every t-shirt will perform on Facebook. Users won’t always show an interest in your ads. Some t-shirt designs simply won’t stick with your audience.
But this is okay. In fact, profiting on your first ad is considered quite a high expectation.
More often than not, it’s through a period of product “testing” that you find a winning t-shirt. In other words, a t-shirt that leaves you a healthy profit after you deduct expenses.
Testing can be a lengthy process, but you can minimise time by learning which type of t-shirts sell.
What makes a winning design? Although there several factors to consider, one thing for certain is that it must be attention grabbing.
People are less attentive and receptive to the ads than ever before—especially ones that aren’t appealing. Knowing this, it’s essential to market designs that win your audiences’ attention.
Want tips on how to create winning t-shirt designs? Read this article here.
Online business idea 3) Sell branded products on Amazon.
Maybe you’re aren’t very creative, and would rather sell products that are already have a strong demand. In that case, selling branded products on Amazon might be the better option.
The business model can be explained in four steps:
- The first step is to find a profitable, branded product on Amazon that you can legally sell. This will require research on how the product is performing in the marketplace.
- Next, find a supplier. But this isn’t as easy as you think. You can’t simply buy a product from a retail store and resell it on Amazon. It’s likely the retail store doesn’t have the legal rights to sell this, and this could land you in unwanted trouble. That’s why you first need check that your supplier has the legal rights to sell it you. This isn’t hard, but it does require that you do a bit of research.
- Ship the product to Amazon’s FBA warehouse. Once you’ve found a supplier, have them ship your product to Amazon’s FBA warehouses. These warehouses are designed to store your inventory. Then, when a customer purchases your product, Amazon will pick, package and ship the item, directly from their warehouse to your customers address.
- List the item and make sales. Once you’ve handled the logistics, the last step is to list the product for sale on Amazon. Given your product is profitable, expect sales to roll in passively.
From here onwards, you only really need to monitor you inventory level, and re-stock when you’re running low.
The secret to being successful in this business is finding the right products. Notice I said ‘right’ rather than ‘profitable,’ as there are other factors just as important that come into play.
One of the most important being that your branded product isn’t too popular. This sounds counterintuitive, but popular brands usually attract heavier competition, and this can limits you in terms of market share.
That being said, focus on products that are moderately popular. Brands that aren’t too big, but also well-known within the niche they serve. While these products are largely profitable, not many sellers seek out underdog brands, for the simple reason that they assume there’s no money to make. With little to compete against, you have more room to ‘piggyback’ off sales made by a successful brand!
Online business idea 4) Start a dropshipping store.
This type of business is fairly similar to print on demand in the way that it works.
Simply put, dropshipping is when you buy a product at a wholesale price and resell it at a retail price.
This model sounds pretty universal, but what separates dropshipping from other models is the way products are fulfilled.
How it works:
- First, you find and source a product with a low wholesale price from a supplier. Then, you re-list the item in your online store at a higher retail price.
- When a customer purchases the item, you refer their order details to your supplier. The supplier will package and ship the item your customers address, while you get to keep the difference in profit.
The major benefit with dropshipping is that it doesn’t require you to hold inventory or storage space. The logistics of the business is largely handled by your supplier.
Your role as a seller revolves around finding and sourcing profitable product to market and test, while maintaining your online store. Overall, finding profitable products is arguably the biggest factor that determines your success with this business.
With that in mind, where can you source profitable products? This is where Aliexpress comes in. On this website, you’ll find thousands of independent Chinese manufacturers that sell goods worldwide.
The largest differentiator Aliexpress has compared to other suppliers is their super low prices. Because you source products direct from the manufacturer, and skip the middle man (wholesaler), you can reap bigger profits on each sale you make.
But a low-price doesn’t mean these products are of high quality. In fact, it’s the total opposite, and there are many products being dropshipped here that have made over six-figures for online sellers.
But, of course: not every product will sell like hot cakes. And it’s extremely rare that every product you list on your website will end up making sales.
That’s why it’s critical to distinguish the type of products that could potentially makes sales from the ones that aren’t even worth testing. When you have an idea of what sells, you can dramatically reduce the time it takes to find a profitable product (through testing).
Like anything worth achieving, building a profitable dropshipping business will take time and effort before you start to see any results. But the payoff is well worth it.
Online business idea 5) Create and sell your own educational digital products.
Are you an expert on a specific topic? If so, why not turn your passion into profit by sharing your expertise online!
Educational online courses aren’t a new thing. Recently, however, more people are becoming attracted to the idea as a means to earn money. While there’s already a ton of free information on the internet, it doesn’t disregard the fact that people value paid information a lot more.
“Don’t I need to be an expert?”
You don’t need to be an expert to teach something online. You only need to be knowledgeable around a topic that you’re confident enough to teach.
And if you aren’t brainy around a certain topic, you can research about it, and teach this to somebody else.
Websites like Udemy and Skillshare are both online communities that allow you to upload your own digital video lessons, and sell them through their platform.
These are great platforms to try as it removes the hassle of setting up your own website, hosting, members area etc.
The Bottom Line
Building a business is no get rich quick scheme. You’ll need time, determination, patience and willingness to learn if you want to gar far.
Whether you’re new to the world of online business, or had previous experience, these five ideas could help spark you into ‘creative mode,’ and decide on an idea to start today.