Listed in: Marketing Technology

Building an online channel

Explore ways to shift some or all of your business online to help diversify revenue and adjust to the new way customers are buying.

3 minute read

If you’re wanting to grow, there are a number of business channels to consider when looking at new ways to sell.

A channel is a way for you to find customers or for customers to buy from you. Online channels are continually changing (almost daily it seems) as new technologies and trends hit the market. If you can find an online channel that resonates with your customers, it could be a real opportunity to find new ways of delivering, new products, new services, or simply improve how you deal with customers and lock them in for life.

New ways of selling

It wasn’t very long ago when either physically meeting and talking to someone or mail order were the only ways to make a purchase. Now the internet and online banking have changed the playing field and it’s possible to buy or sell without ever seeing the person at the other end of the transaction.

Aside from typical online shopping methods, other ways of selling now include:

• drop shipping (another business holds the inventory and ships to your customer)
• affiliates (you receive commission by recommending other business’ products)
• brokerage (connecting buyers and sellers like real estate agents)
• renting short-term (e.g. using a scooter for 10 minutes)
• on-demand (delivering only when ordered, such as printing and books)
• resource sharing (e.g. Uber and Airbnb enabling the public to rent their asset to end users).

What is trending in your industry that you could take advantage of? Investigate what other businesses are doing that you could adopt.

Online marketplaces

A business no longer needs its own channel to market. The growth of third-party marketplaces like Amazon and Trade Me (which sell almost everything) or specialist global sites like Etsy (selling mainly art and homewares) allow you as an independent seller to list goods or services which they promote to their database of customers. Yes, they may take a fee, but the benefits may include low set up costs, easy product listings, access to their customers, and payment processes set up for you.

Investigate your industry marketplace and decide if it’s worth trying this as a new channel to complement how you sell.

Subscription models

Paying a monthly fee is increasingly embedded into our way of buying, where we’re willing to commit to recurring payments in exchange for continually updated products or services. Netflix, Disney, Neon, and Apple are good media examples. Xero for accounting software. And of course, online gaming.

But you don’t need to be a tech company to have customers subscribe or even have your own payment system, as digital payment platforms such as PayPal, Stripe, and WePay allow you to set up and process recurring payments yourself.

Other businesses charging a monthly fee include:

• professional services such as accountants and marketers
• consumables
• health and wellness (gyms and supplements)
• meal delivery
• leasing of vehicles
• publications and exclusive content.

What can you sell or provide where customers pay you monthly?

Giving stuff away for free

Some of the largest companies in the world such as social media platforms (Facebook, LinkedIn) and search (Google) have business models which offer the core product for users at no cost, who then post, blog, discuss, share, and participate for free. The traffic generated is monetized, usually from online advertising.

Online media and gaming sites also use this model to provide a certain amount of gaming/information for free, with upgrade options to purchase inside the product.

You too may be able to deliver parts of your business for free while creating alternate revenue streams, though your ‘giveaway’ doesn’t need to be product. It could be valuable content, information, or services as a lead generating opportunity.

Check new ideas are feasible

There are many ways you can introduce new online services, products, or channels to your business. If you do implement a new way to sell, make sure the business model is profitable and can stand alone if needed.

To help you choose the right channel:

• Stay informed about the best new business apps and what is relevant to your industry.
• Evaluate any new software or channels introduced by your industry.
• Safeguard your new online business from theft or fraud.
• Use social media to identify how customers prefer to buy.
• Ask your customers what they use and how they want to deal with you.

To win new customers and provide reasons for your existing customers to stay, consider which existing online channels you could adopt and keep up-to-date on your industry trends to see what you may need to implement in the future.

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This article is solely for information purposes and is not intended to be financial advice.  If you need help, please contact BNZ or your financial adviser. Neither BNZ nor any person involved in this article accepts any liability for any direct or indirect loss or damage arising out of the use of, or reliance on, all or any part of the content.

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