This is the fourth installment in this ongoing series on Internet Home Business – the basics of getting started.
This time I want to address the subject of planning a budget to get your business off the ground. There are several categories we will need to address. The following list is not all-inclusive. There are a number of possible needs that may arise as you begin your online journey:
- cost of a designing a website (if you’re going to blog then you can do it for free at Blogger)
- web hosting expense
- opt-in email software with built-in autoresponder
- SEO software or service to improve your website presence with the search engines
- ongoing training to improve your internet marketing skills
- using affiliate marketing to promote and sell your product or service
- paid placement with Google, Yahoo and MSN to market your product or service
- Adware/spyware software to protect your computer
Once again I want to emphasize that I just want to give you a general idea of what you should plan for if you are going to do business online. There are a number of other possibilities that may arise as a result of the path you choose to take. Let’s begin by briefly looking at each item I listed above…
- Cost of designing/building a website – in many cases the process of creating and hosting a website can be handled by the same company. Whether you choose to combine both processes or not will depend on how much control you want to maintain over the details of your site. If you are extremely creative and you want your site to reflect this then you will need to purchase a high caliber software like Frontpage or Dreamweaver to create your site offline. Once that is completed you can simply upload your site to the hosting company’s server. Most software like Frontpage will cost upwards of $200. There are a number of other products that can be purchased anywhere from $19.99 all the way up to $169.99. You can get a fairly good review of these products by searching the key phrase “web site creation software”.
- Web Hosting expense – if you do decide to purchase a website builder and later upload to a web hosting service here again you have a number of choices. Each one will differ slightly from the other. They will average about $4.99 per month. I have used 2 services in particular: iPowerweb and Sitesell. The are at extreme opposites of the spectrum as far as costs are concerned. For about $4.99 a month you get a lot of bang for your buck with iPowerweb. They actually provide both website design and hosting. So if you have already spent a fair amount on a website builder then you’ll actually find them to be very reliable. However, if you are totally new to this whole “internet and websites” thing but you are 110% committed to making your mark on the internet then I highly recommend you take a look at Sitesell. The service will run you about $300 a year. To truly understand the value they offer at this price you really do need to visit their site. It is the most comprehensive and user friendly system on the market. This service has been specifically designed with those in mind who are serious about making money from their website but don’t want to learn all the “techie” stuff in order to start and run an online business.
- Opt-in email software with built in autoresponder – There are only two that I can confidently recommend for this part of your business; one is offered at $19.95 from Aweber and the other runs about $17.95 a month and is offered by GetResponse. They both offer pretty much the same thing and provide excellent customer service along with a great product. Both of these companies offer a complete email marketing tool for your business. This service is a must if you plan on maximizing your sales. At some point you may want to use your own email/autoresponder which runs from your hard drive and in that case there is a product called Mailloop that is very high tech and offers pretty much the same thing. the price tag is about $200. The only difference is that you actually own the software instead of renting it each month. I would only recommend this option once your business actually takes off and you’ve built up a head of steam.
SEO Software/Service – I certainly hope you didn’t think that you could just throw up a few pictures and some text on your new site and have savvy web browsers actually throw their credit cards at you. The process of understanding SEO and how to make it work for you can be daunting. There are some very basic things that just about anyone can do to get their site somewhat “search engine friendly”. However, the market is getting more competitive each year. Your placement on the search engines can’t be left to chance or poor SEO tactics. You will need to research and decide on whether you want to use a service or purchase your own software. Using a service can be a big “roll of the dice” and there aren’t too many individuals who can afford them to begin with. I strongly recommend that you invest in an SEO software that you can download and get free upgrades with each year. Going this route will actually enhance your knowledge about website design and empower you to take on bigger projects as your confidence grows.
In the short term it will translate into better results for your website. Don’t try to operate your internet home business without this investment. The cost for a good software will probably run you at least $200. The better ones will offer you a free download that you can test drive for 30 days. If you decide to go this route please be sure to take it for a test drive every day and take it through the ringer to be sure you are familiar with every aspect of the program. You’ll then be able to fairly evaluate if it’s worth your time and money.
- Ongoing training – Be sure to take advantage of free subscriptions from some of the experts of internet marketing. Most of them are eager to share their knowledge with you and you can tap into it by trading your email address for a regular newsletter. SiteProNews is a great source of information on this subject. When you find a great article simply copy and paste into a folder on your home computer for future reference. Set up various folders for different categories, i.e., web design, writing good content, shopping cart service, html, etc. Your cost = $0.
- Affiliate Marketing – Whether you decide to become an affiliate marketer or have someone else market your product affiliate marketing is an art that you should take the time to learn. As an affiliate marketer, it won’t cost you anything to start. Anyone who has an affiliate program will gladly let you promote their product. It’s a win-win situation for them. Your only cost is the method of advertising you choose to promote this product. As a result your costs will vary depending on how good you are. Some folks will have already built up a sizeable list then can email to and be able to create great sales copy for a targeted audience and your affiliate product. In this case their advertising cost is zero. If you plan on using paid placement then it becomes a lot riskier depending on your skill level. As a rule, I would say that you should plan on making at least $3 for every dollar you spend on paid placement. Some might say $2/$1 would be good enough. How much you’ll spend each month depends on how deep your pockets are and your ability to convert your traffic. The higher the conversion rate the more you can afford to spend. If you have a product you want to submit to an Affiliate Network to let any marketer promote for you then you’ll need to consider the set-up fees ($20-40) and the commission you willing to pay on each sale. As a rule you should pay out 60% of your sale price to attract the top affiliate marketers.
- Paid Placement – Before venturing into this arena (which has been a very effective one for me), you will definitely need to educate yourself. Although Google’s AdWords tutorial is a good tool it doesn’t go far enough. You should definitely invest in a training material like “The Definitive Guide to Google AdWords” by Perry Marshall. I would consider this the AdWords bible of internet marketers. I believe you can still download this ebook for under $100. Take my word – it is worth every dollar.
- Adware/Spyware – Last but not least, take every precaution to add additional protection to your computer. A good program will cost you less that $40.
So there you have it. I’ll let you do the math to get your exact numbers but if you’re serious about making money online then you need to be prepared. Once again, this is not an all inclusive list, but it gives a fair representation of what you should be prepared to spend to run a successful online business.