If anyone knows the ins and outs of getting a successful e-commerce business off the ground, it's Dragons' Den's Michele Romanow. The feisty tech-maven recently sat down with us to share some of her best tips for starting, marketing, and optimizing an e-commerce business for long term success.
If you aren't familiar with this phenomenal woman, Michele is a Dragon on CBC's Dragons' Den. At age 32, she is the youngest Dragon in the den to date. She has been the driving force behind huge e-commerce successes like BuyTopia, where she is a co-founder, and Snap by Groupon, where she is a Senior Marketing Executive. She is also co-founder of SnapSaves, and Clearbanc. She's a Director at Block X Capital Corp, and Whistler Blackcomb Holdings Inc. She's an Independent Director of Vail Resorts, Inc. and Freshii Inc. She was included in the WXN's "100 Most Powerful Women in Canada", Forbes "Millennial on a Mission" list, and won the Toronto Board of Trade Award for entrepreneurs under 30.
Basically, she has a ton of knowledge in business, expertise in the e-commerce and tech space, and an incredible track record of success – along with just enough failures to learn some valuable lessons that honed her business skills.
Michele's wealth of knowledge has been distilled into a condensed four-part video series – perfect for hungry entrepreneurs who are ready to take their business from concept to reality. Today, we're diving into part one. In the first video of the series, Michele wants entrepreneurs to learn from her mistakes, and get their business started on the right foot. Here are her four pro tips for taking your business from concept to market:
Tip #1: Test the Market
Before you invest your hard-earned money in a new e-commerce business venture, you need to test the market. "You've got to make sure that there's a demand for your product, and that people are willing to pay for it," says Michele. "Otherwise you're probably wasting your money, and you just don't want that."
You might be wondering how you can test what doesn't exist. We know what you're thinking, but the answer isn't market research – which Michele says is inaccurate in her experience. The real test for success? Crowdfunding.
You can use a crowdfunding campaign to see if consumers really want your product, before you even have to make it. This is a great, low-cost gauge to determine if people really want your product, and what they're willing to pay for it.
Michele is definitely onto something. Nearly 400,000 products have been launched through Kickstarter alone, after enjoying successful crowdfunding campaigns. The platform currently boasts a 36% success rate (percentage of projects that attain full funding), so giving a campaign a go is definitely worth a shot for most entrepreneurs with a vision. In fact, one of Michele's best investment deals in the Den to date was with Tapplock, a company that had no sales but did have an outstanding crowdfunding campaign.
Tip #2: Don't Rush the Launch
So you know what you want to sell, and that people are ready to buy it from you. Before you take your product to market, you need to get your ducks in a row. "Make sure you know your numbers, and that your cash flow makes sense before you go to market," advises Michele. Her pro tip? "Don't price too low. It's easier to lower your price than to raise it later."
Michele also recommends setting up a pre-order system to build momentum, and get your cash flow going. She notes that it's also really important to be capable of delivering on your sales if your product has significant traction when you launch. Long story short – demand is great, but make sure you're prepared to meet it before you start selling.
Tip #3: Choose the Right Platform
Michele emphasizes the importance, and benefits, of finding the right platform for your e-commerce website. Luckily there are a ton of amazing options out there that make setting up a high performance e-commerce site a breeze – think notable platforms like Shopify. She recommends finding one that will help you create an attractive, efficient, and easy-to-manage website.
Just try a couple. Choose a platform that's integrated with other companies to help streamline your business.
She also emphasizes the importance of finding a platform that is compatible with trustworthy payment tools like PayPal. "Customers feel a lot better about purchasing something online when there's a secure, trustworthy payment platform available to them."
Tip #4: Brand your Business for Success
Michele is a huge fan of accessible and straightforward branding. For her, it all comes down to "a memorable name, a clear domain, and a focused logo." Sometimes, the best thing you can do is not overdo it.
Your name should be short and catchy, easy to spell, and also easy to pronounce.
Another pro branding tip from Michele is to ensure that you are the only one using your business name. It's easy to find out if you have competition – just Google your brand name and see what comes up!
With Michele's tips, you will be well on your way to starting a successful e-commerce business. Stay tuned for the rest of this insightful video series for entrepreneurs.
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