Web 2.0 started as a revolution that uses the web to link people together. Web 2.0 means communicating, sharing, discussing and trading online in very useful ways never possible before. Web 2.0 simplifies collaboration and information exchange. We get used to Web 2.0 services as a part of our daily lives and these services are being more popular day by day.

Web 2.0 makes headlines, but how is it possible to make money by starting a Web 2.0 business? We are sure that there are very successful Web 2.0 companies. Google makes money based on  “free” search,  Facebook and other social networks  grow so quickly and their content is created by their users.

This concise list is prepared to explain what’s different about Web 2.0 and  to help you about how to create a successful Web 2.0 business.

1. A Simple Business Idea: Every succesful business requires a business idea.  The main problem abot business ideas is that people think a complex idea means more success. Most succesful Web businesses focus on simple problems and solve them perfectly. There were search giants before Google but Google improved search results, localized its services with a very-simple interface and for free. Don’t forget, complexity is the enemy of Web 2.0 . Think simple!

2. Create and Release as Early as Possible: The development velocity is important when you start a Web 2.0 business. Investors want to see working prototypes before they invest in your projects and don’t forget the competitors; some of them are experts about getting others valuable ideas and transform into businesses.

3. Use The Network Effect: Web 2.0 World is people-centric and there are countless free ways of collaboration with people who may become your users, investors or team-mates. Social networks and social bookmarking sites likes Digg are the best places to find volunteers for testing your products or advertising your business for free. Listen to your customers and let their feedback shape your product.Try to develop a community around your web business and hire a community manager as soon as possible. Motivated fans will be the best and the cheapest marketing staff of your company. The network effect is the main reason why leading Internet companies got so big, so  fast.

4. Use Web 2.0 Tools To Cut Costs & Save Time:The simple rule to calculate how much money you need for a startup is; ”If you plan to develop in a year, it’s going to take two; if you think it’s going to take $100K, it’s going to take $200K”. So you must find a way to cut your costs and finish your project in due time. Web 2.0 tools help you to complete your tasks in a fast and mostly for free (or at a small charge) way. For example FreshBooks offers a simple invoicing and time tracking services that help you manage your business and lets you . Google Voice gives you anumber for all your phones, voicemail and sms. Especially in the startup phase, online services save you time and money, be available 24/7 and make you look professional.

When developing your products; don’t re-create what you can source from elsewhere. Another website’s API or Google App Engine may reduce your development time. Try to source it from elsewhere before you build something up. If you’re lucky it can be for free but sometimes it’s worth buying a ready solution; your time is priceless.

5. Monetize Every Chance: Advertising can often seem overly commercial especially in the startup stage but a sponsorship or small advertising sections are good for your business to make some money. Every pageview of your web business has potential as an earning point. You can also find innovative ways.

6. Track Your Users & Rankings: Success of your web 2.0 business depends on your business’ statistics. More users mean more money. You must track how man users visit your site, how much time they spend on your site, the most popular and the least popular parts of your site, how much registered users you have and etc… There are plenty of web 2.0 services to track your user analytics and  I think Google Analytics or a similar service is adequate for this purpose. You must also track and evaluate the demographics of your users to understand their needs and level of interests. User registration and polls are good options.
Tracking you site’s ratings is another important thing. Google’s PageRank, Alexa’s Traffic Rank and other rankings show how popular your site is and enables benchmarking of your site’s performance to your competitors’. You must know who’s talking about your company and in what way,too.

7. Don’t Forget Marketing: If developing a good web service is 50% of your business; the other 50% is marketing. Most of the creative & innovative solutions become trash because they can’t become brands. New users mean new markets; having a well-planned market strategy can save your business’ life. Instead of diving into a crowded market like a red ocean full of sharks, look for emerging areas on the web and try to find niche markets.  You should read something about Blue Ocean Strategy to learn niche marketing better. Marketing and brand positioning are two important points that you can need a professional’s help.

8. Read About Successful & Unsuccessful Internet Companies: Experience means money and time. A web entrepreneur must read the success stories of Amazon, Google, Youtube, Yahoo, Digg, Facebook, Myspace, LinkedIn,  PlentyofFish and the others, once. But an internet entrepreneur must read the stories of unsuccessful Internet companies that entered the deadpool, twice.

9. Have a Revenue Model: You can have 10 million pageviews, your users can spend several hours in a day on your site but it’s possible that you earn nothing. Every business needs a revenue model. You can sell physical goods, just run ads or sell your online services. It’s your business and  you will make a decision.  Don’t forget without a revenue model, starting a web business is a business suicide.

10. Continually Improve Your Business and Develop Improvement Metrics: Continuous improvement is the key factor to stay alive in Web 2.0 World; without continuous improvement, Web 2.0 itself can’t stay alive.  Experience is important and failure breeds success. You must learn from your mistakes and not repeat them.
You should define your targets and the KPIs (Key Performance Indicators) to reach your targets. For example, ROI rate is very important if you have investors. Define your metrics and check them often and improve your strategies to improve your business.

This post is a brief of personal experience and inspired by Dion Hinchcliffe’s “50 Essential Strategies For Creating A Successful Web 2.0 Product” article.

]]> http://siteboat.com/creating-a-successful-web-20-business/feed/ 2 http://siteboat.com/5-things-to-start-a-start-up/ http://siteboat.com/5-things-to-start-a-start-up/#comments Thu, 19 Mar 2009 15:50:37 +0000 Erdem OZKAN http://siteboat.com/?p=1814

(This post is co-authored with Web2INC Magazine)

The most stressful phase of a business is its start-up phase. If starting a business was easy, everyone would do it! You need 5 things to create a successful business: Idea, Courage, …

When used in business, the term “Niche” is used to describe fresh, virgin and profitable…

A niche market is a focused targetable segment of a market.  A business which focuses on a niche market  adresses a demand for a product or a service which is not met by any supply. Niche markets don’t exist themselves everytime. In some situations, you must create your niche markets by identifying demands (needs and wishs of your customers) which are not met by your competitors.

Niche Marketing

Niche marketing is the process of finding and serving profitable niche market segments. Niche marketing means less competition but much more effort than traditional marketing. The hardest part of niche marketing is finding customers. The easiest medium for niche marketing is the Internet, because of its capabilitiesfor reaching customers easily.

The basic step of finding a niche market is having an innovative and profitable business idea focusing on market segment with less or no competition. If you prefer to go further on this topic, you can check our “Five Steps of the Successfully Internet Niche Marketing”  article.

A niche market means special customers with specific desires and much more challenge for you to sell your specific products or services. Reaching these customers is so hard, but the most efficient marketing medium to use is the Internet. Niche marketers need to know where to apply the Internet’s power.

A good case: SailBlogs

Sailblogs is a blog hosting service which provides blogging and map tracking solutions for the sailing community. SailBlogs offers a very easy editor interface for blogging. SailBlogs uses Google Earth for their customers to track their sailing adventures.

With the eye of an Internet entrepreneur, blog hosting services market is a crowded market and has become a widely known market. Today, it’s too late to start such a business like Blogger.com. There are so many competitors and this market has become a “red ocean”, one full of sharks, attacking each other for meat. When you sail across oceans; you can’t have much time for programming and maintenance of your weblog.

When we look from the sailors’ window; if you are a sailor, you need a time-efficient way to tell  about your sailing adventures and show your photographs & videos to the whole world. An on-line journal can keep you connected.

The intersection of a blogging enterprise and sailing journalism was a hidden niche market and waiting to be discovered. Niche markets are based upon special problems that need special solutions. The innovative solution for both of the Internet entreprenurs’ and the sailors’ problem is SailBlogs. SailBlogs has created its own blue ocean and a niche market to sail across without any competitor. Basic web interface for blogging is the first solution that SailBlogs offers to the sailors; no programming and no HTML knowledge is needed. The second problem for sailors is connection. SailBlogs offers remote posting, map positioning and uploading via satellite phones and this fetaure makes SailBlogs ideal for sailors to use whenever and whereever they want.

Don’t forget that an innovative business idea is a must for finding a special solution to create a niche market.

Niche marketing is an important topic and we will be releasing more articles soon …

A succesful business plan is a document that conveys the exciting prospects and growth potential of your business idea. A good business plan is a powerful tool for you to use as an effective selling document. For instance, a business plan may be used to seekfunding, to form alliances, or for other desired functions.

Just as advertising and promotional material sell a company, so should a business plan. A business plan must be managed just as most other projects managed. A business plan typically has these key sections:

• Executive Summary is firstto determine if your business idea is a potential candidate to read further. As a perfect brief of your business plan, this section should be prepared last.
• Company Description covers your company’s mission, history, current status and the future plans; in other words; past, present and the future of your company / business idea.
• Management and Organization is an important predictor of a succesful business for many potential investors.
• Marketing Plan section must define your company’s market and must include brand development, pricing, demand management and information about competitors.
• Operational Plan outlines how you will service your clients. Issues that must be adressed are Research and Development process of your service/product, how you will manufacture or deploy it and what your service costs.
• Staffing Plan covers your staffing needs like staffing roles, management structure, numbers of employees needed and their salaries.
• Financial Information covers current financing information like key investors or owners, existing loans liabilities; fianancial history; financial forecasts – the balance sheets, the cash flow statement and income statement; valuation of your your company or your brand.
• Risk Analysis is an optional section and especially used for internal purposes. and covers the market risks, operational risks, staffing risks and financing risks of your company / business idea.

In this post, we’ve mentioned about content of an effective business plan topic, briefly. If you want to succeed, firstly you must have a good business plan. We’ll continue on “Business Development Series” on Siteboat. This is the 3th post of “Business development Series”.

What is a business idea? – Business Development Series – 1
What is a business plan? – Business Development Series – 2

You can reach detailed information about content of an effective business plan form the sources below.

Sources:
Content of a business plan – Wikipedia – the free encyclopedia
Writing an Effective Business Plan, Fourth Edition - Deloitte & Touche

The second post of our “Business Development Series” is about the definition of “business plan“. A business plan is a document that has a summary of the operational and financial objectives of a business. It contains the budget and the operations needed.

A business plan is a formal statement of a set of business goals, the reasons why they are believed attainable, and the plan for reaching those goals. It may also contain background information about the organization or team attempting to reach those goals. Wikipedia

Many people think that a business plan is only to secure an external funding.  A business plan helps you about to secure an external funding, but it has many other benefits, too. A well-developed business plan can help you as a powerful management tool. A good business plan will provide you step-by-step instructions on how to transform your business idea into a profitable business.

When? Once you’ve conducted your business idea into the feasibility of a new business, then you’re ready to wirte a business plan.

Why? Preparing a good business plan is painful, but planning process forces entrepreneurs to understand more clearly what they want to achieve and how and when they can do it. It helps you structure the financial side of your new business and it’s also a requirement when you’re seeking finance froım external resources. A business plan works as a measure of  your new business’ success. Briefly, a business plan answers “what for?” and “how to?” questions for your business idea…
Next in series “What is the content of a business plan? – Business Development Series – 3″

As I’m working as a Strategy and Business Development Consultant, i want to share the basics of business development to help you develop your own businesses, with you. I’ll post some ”Business Development Series” topics which are about innovation and entrepreneurship. The first topic is ‘What’a a business idea and what is not’. An idea is a form (such as a thought) formed by consciousness (including mind) through the process of ideation. (Wikipedia)

A business idea is a concept which can be used for commercial purposes.

A business idea is about a commodity or a service that can be sold for money. Initially, each ideas has no commercial value. First, you must check feasibility and innovativity of your business idea to get more information about your idea’s chance in the marketplace.

A promising business idea must satisfy these tests:
1-Does it fullfill a customer need or solve a problem?
2-Is it innovative and unique?
3-Does it have a market or create a new market?
4-Is it profitable in long term?

The Internet business ideas don’t differ from other business ideas. Before developing an Internet business idea, you should ask yourself the same questions above. So before you start your Internet business, check your idea worth a try turning into a business.

One of the best resources for “Business Idea” topic is Søren Hougaard’s “The Business Idea: The Early Stages of Entrepreneurship” book which you can preview by clicking-on the button below.

Next in series “What is a Business Plan? – Business Development Series – 2” …