How To Start a Successful Ecommerce Business From Home: 11 Important Steps [2022]

If you’ve ever thought of starting your own online business, there’s no better time than the present to get started.

More people than ever are shopping online and the global online shopping market hit nearly 4 trillion in 2020. According to Insider Intelligence forecasts, it is predicted to grow to $6 trillion by 2024. This means that with each passing year, your pool of potential customers expands because more people are adapting the habit of online shopping.

It’s a lot easier to start an online business than a brick and mortar shop. All you need is a computer, which you probably already have. The rest is figuring out the logistics, including your target market, your sourcing, your sales model and more.

In this article, we’ll outline 11 steps you’ll need to take while building a profitable online business from home.

Note: This article focuses on building a business that sells physical products, rather than a service-based business.

What are some of the perks of running your own online business from home?

The first step to starting your online business is to figure out what type of business you’ll be the best at running. If your business is related to your passions, strengths and interests, you’ll have more sustained motivation over time because you’ll care more about what you’re doing.

A great way to get started is to ask yourself the following questions:

Of course, it’s possible to run a successful business selling any type of product. As long as you get the strategy right, your product doesn’t have to be something you really care about.

However, since you’ll spend so much time and energy building your business, it really helps if it’s something that will continue to stir your interest over the long term. Many of the most successful businesses started with a mission and a purpose behind them.

Another important step when starting a business is to define your target audience. A major mistake many business owners make is assuming they can sell a product that “everyone” will want to buy.

However, trying to appeal to everyone is a surefire way to spread yourself too thin and fail. Instead, focus on a specific target audience so that you can really get to know and understand your customers.

During this stage, it’s helpful to create a customer avatar. This is an imaginary person who represents your ideal customer. Here’s a really simple five minute video you can follow along with to create your customer avatar.

Many people starting a business make the mistake of looking for a product first, then looking for a market for that product. Instead, it makes much more sense to think about how your product is solving a problem or fulfilling a need for your target market.

When you offer a product that will solve a problem for your customers and make their lives better or easier in some way, they will be willing to part with their precious cash to get their hands on it.

How can you find out which problems are in need of solving? Here are some ideas for how to research this:

The most important thing to remember is that the customer should always be the hero of the story, and the product should be designed around their needs.

Thanks to the internet, it’s never been easier to conduct market research before starting an online business. There are so many useful resources at your fingertips, including online questionnaires, web searches, forums, blogs and more.

One of the important steps is to make sure your product has market viability. If a market is “viable” that means it will continue to be profitable for a long time.

For example, if you are selling merchandise related to a specific event, you might find that demand dies down after that event is over. But if you’re selling something timeless that your customers will always want, you’ll have a viable business for many years.

How do you find out what people are looking for? You can start by checking SERPS and keywords, as well as conducting online surveys. Here are some useful tips on research tools and techniques.

When you’re developing your business idea, you’ll also need to think about your competition. After all, you’ll likely not be the only business providing products like yours. So, you’ll need to think about what makes you unique.

Who are your competitors? Are there a lot of them? If there are many other businesses out there like yours, you might struggle to compete unless you find a way to stand out among them.

What are they offering? How much money are they making? What are their strength and weaknesses? What can you offer that is different than them and sets you apart?

This differentiation can be something you highlight in your marketing. Point out the cons of choosing your competitors, and how your product offers an advantage compared to theirs.

The next step in the process is to decide how you are going to source your product. A product that you sell online can be produced locally, or it can be imported from another country. Some of the options for sourcing include:

The decisions you make at this stage might mean you need to address the legal compliance of your product in the location where you are selling it. (We’ll get into that in more detail later!)

It is possible to build and host your own eCommerce site, but you don’t need to do that to start an online business from home. You may choose to use a third-party eCommerce marketplace such as Amazon, eBay, Alibaba or Etsy.

Building a business through one of these platforms can be a lot simpler, as the system is already set up for you and you don’t have to start from scratch. You’ll need to pay some fees to use the platform, but it will also be easier for your customers to find you.

Of course, these business platforms are not created equal and they all have their own pros and cons. Some of the factors to consider when choosing an online marketplace platform include:

These are just a few of the many questions you should ask when choosing a platform. But the bottom line is that you’ll have the most success with the platform that serves the needs of your customers.

No one wants to end up in legal trouble. One of the most important steps of starting a business is to understand the laws and regulations involved in selling your product. If you are selling products in another country, you’ll need to be aware of how the law applies there.

For example, if you sell certain products into the EU, you will need to appoint an Authorised Representative. The Authorised Representative acts as a liaison between the manufacturer outside of the EU, and other competent national authorities within the EU.

This person is responsible for making sure that the products being sold are safe and of good quality, which reduces the risk of accidents, injuries and product recalls. Without appointing an Authorised Representative for your business, you could be putting yourself at risk for your products not being allowed to enter the EU.

Of course, whether or not you need an authorised representative and whether they are legally responsible for defective products depends on the particular industry you are in.

In fact, there will be a lot to figure out that will be specific to your location and your industry. You might want to consult with an expert to make sure you are setting up your business correctly from the beginning, so you don’t face legal obstacles on the way.

Branding is much more than simply choosing a name and a logo for your business. It’s about building a story around your company that your customers will connect with emotionally.

Why is it so important to develop an identifiable brand for your business?

This may be something you want to hire an expert to help you with. A talented designer can help you develop a strong “visual signature” for your brand that can be easily recognised and remembered by your customers.

You’ve put lots of thought and time into choosing your product and building your business – but you won’t make any sales if no one knows your product exists! So, the next step is to think about how you will promote your business.

The key here is to go back to the customer avatar you created and think about how you could best reach that person. When you picture your typical customer, where do they usually find out about this type of product? Research the online behaviour of the demographic you’re marketing to, so you can decide which channel is the best way to reach them.

For example, do they often purchase products recommended by Instagram influencers? Or do they look to friends and family? Which social media channels do they use? Do they read blogs related to your niche?

Every time you design a marketing campaign, be sure to pay close attention to the results to assess whether or not it’s doing it’s job. Which leads us to the next point step: monitoring your business metrics.

And last but not least, it’s essential to track the performance of your business so you can measure your growth and identify what needs tweaking. As the great management thinking Peter Drucker said, “You can’t manage what you can’t measure.”

But what metrics should you be measuring to track the success of your small business? Of course you should be keeping a close eye on your profits, but that doesn’t tell the full story. You should also be looking at:

Keep in mind that looking at these business metrics isn’t something you’ll only do once. You’ll need to assess them again and again on an ongoing basis, so that you understand how your business is performing and what your next move should be.

Starting an online business might seem overwhelming at first. But as long as you take it one step at a time and plan things out, things will start to take shape.

It might take a bit of time for your business to gather momentum and begin making significant profits, so be patient and don’t give up! Once you start to establish your brand and build a loyal customer base, you’ll be able to enjoy all the benefits of running a profitable online business from home.

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