As a student currently taking two entrepreneurship class, I am learning a lot about what it means to start a business. As every entrepreneur knows well, finances are everything – especially when you’re just starting your venture. When I think of starting my own business, I am daunted by the risk and insecurities it brings. However, based on my limited knowledge and some research as well as lessons applied from class lectures, I hope to provide a small look as to how we can ease our minds a bit and begin to make money:
Since the process is difficult starting out, you must be comfortable to project a range rather than a specific number for your forecast. Typically, as a startup, your revenue will come from one of two ways:
Impression based (CPM): Advertisers pay per impression. Meaning, an advertiser would pay a certain amount based on how much viewer traffic you receive.
Performance based (CPA): Advertisers pay per action. Meaning, an advertiser would pay a certain amount based on how many of your viewers follow through with the advertisement and act on it.
The entrepreneur would decide which method is best for their purposes and with their business and hone in on that strategy. Once they do that, they can calculate an average revenue stream based on some simple math (multiplying by number of views and ads, etc.) Of course, these revenue sources are from ads, which at times tend to be frowned upon by consumers. It is important to have quality traffic, leading to quality ads that are applicable to your consumers. The natural question that follows then, is how do you increase traffic?
Once you are a bit more established in your business, you may want to invest in SEO – Search Engine Optimization. This allows you to increase your rank on search engines, therefore producing more clicks/viewers. Another method would be using hashtags, a highly-used medium, for social media platforms. Short-and-sweet can go a long way and you never know who may see the tag. Depending on your business, you may also want to explore email marketing. This can be in the form of weekly newsletters, promotions, useful information, feedback opportunities, etc. This can improve your traffic and begin a communication method between you and your customers. One other interesting idea could be to have a micro-influencer of some sort publish a blog post on your website endorsing the product. Not only does it reflect an active status and create diversity, it may even draw the publisher’s audience and give you added exposure.
When I access the website of a new product or service, I find myself more responsive when I see actual reviews from people, ease of communication with the founders, and simple interfaces that aren’t clogged with advertisements everywhere. No matter how difficult it is, it must be a priority to learn what your audience desires/is more responsive to and serve to that goal – this will eventually become profitable and successful.