The recent pandemic has hit small businesses and entrepreneurs harder than any other segment of the economy. Small businesses typically have fewer resources to survive a crisis. Small businesses also typically have less experience with being entrepreneurial in the digital world, which is now one of their best options for weathering the storm.
Small business should be considering a number of digital activities in this time of crisis. The standard advice includes applying for government assistance, keeping in touch with customers online, and starting e-commerce sales for existing products.
These are all good moves, but the research on digital entrepreneurship suggests some additional options. Here are three additional areas of digital opportunity for small businesses and entrepreneurs.
1) New models for doing business
Exploring how to sell your existing products online is a great idea, but consider selling your expertise as a new online service. Many households have at least one person with extra time to learn new skills, or with a pressing need to find new, more personalized ways to entertain themselves. Another possibility is to sell digital products based on your skills, such as online courses or digital how-to guides.
Beyond selling related new products and services, however, digital entrepreneurship allows you to explore entirely new lines of business. A big advantage of digital entrepreneurship is the ability to try new business ideas at no or low cost.
For example, your new digital business could provide valued information that helps consumers make other purchasing decisions. Online traffic and spending are up during this crisis. Advertisers and marketers are interested in capturing the attention of these new online traffic streams, and will pay for quality customer leads. New revenue possibilities include display advertising, performance advertising, sponsorships, and commission payments through affiliate marketing sales.
Another new digital business opportunity is to become a matchmaker, connecting people who need an online product or service with those who could best provide it, and charging a transaction fee or percentage. What groups of people do you already know best? What are their unique needs during this crisis? And where can you refer them to for help? Many of the large digital matchmakers—the Airbnbs and Ubers of the world—will need to be temporarily replaced by more local solutions fitting local circumstances, and able to navigate local restrictions as they evolve.
2) Perfecting your digital business process
A simple way of thinking about digital business is to view it as a three-step ABC process: Acquisition, Behavior, and Conversion. Acquisition brings potential customers to your digital business, through search results, social media campaigns, email, search or social advertising, and many other channels. Behavior is what visitors do on your digital presence that satisfies their needs, and helps them achieve their goals. Conversion is the action you would like each of your visitors to perform, whether it’s completing a purchase, clicking on advertisement, asking for an appointment, or downloading a menu.
This crisis is an opportunity for your business to improve its capabilities in any of these three essential areas. For customer acquisition, now is a great time to be building out your digital marketing campaigns. This will get customers and prospects prepared for when they are ready to spend again.
Behavior can be enhanced by improving your digital customer experience. Try new features, new content, and new ways of organizing and navigating your online presence, to see which ones are more popular, and increase engagement. The analytics data provided by your digital business is your friend here.
Converting visitors into potential or actual customers is an essential digital business skill. Use your crisis time to try different calls to action, asking customers to do things that will increase their involvement. Practice getting your visitors to perform simpler activities such as likes, comments, and shares. Then deepen the involvement by signing up for discounts and newsletters, submitting content of their own, or booking a future appointment.
As you practice each of the ABCs of digital business, don’t forget to consider how they all fit together. It’s easy to acquire new visitors with promises that can’t be fulfilled, or goals that you aren’t able to satisfy. Acquire the right visitors that will be satisfied, and will convert.
3) Begin the experiment/test/scale cycle
A key advantage of digital entrepreneurship is the ability to experiment constantly. In each part of the ABC process, there are many new ideas to try. Get familiar with your analytics data, which for most digital entrepreneurs will be from Google Analytics. It will give you precise feedback on what works, and what doesn’t. Big businesses are already doing this, running hundreds or thousands of experiments on their customers each day. Small businesses will need to learn digital experimenting skills if they want to stay competitive.
Fortunately, digital entrepreneurs have the advantage of being able to jump on new trends that are not yet large enough to interest the big players. A crisis situation is a hotbed of new search trends, new hashtags, new memes, and new discussion points to be taken advantage of. Once digital entrepreneurs find new business ideas that work for their first 100 or 1,000 visitors, it is relatively cheap and quick to scale up those ideas as trends take off. Be on the lookout for new ‘nanotrends’, and be ready to grow as those trends play out.
Digital entrepreneurship does require learning a new set of skills. For many small businesses, the transition to digital has been slower than expected. The good news is that it’s easier than ever to be a digital entrepreneur, even if you’re not particularly techie. Build your skills now, because digital entrepreneurship might be your best source of opportunity for the foreseeable future.