Online businesses also have entry barriers: we will tell you which ones

The online world is a great place to start. There are few doubts about it. If it weren’t, there wouldn’t have been so many millionaire businesses and there wouldn’t be so many people making a lot of money working from home.

However… Is it for everyone? Today, we talk about entry barriers to entrepreneurship in the online world.

You need knowledge outside of your business …

The first problem with online entrepreneurship is that a series of knowledge is needed that is totally unrelated to the business that, perhaps, you are thinking of developing on the internet.

For example, suppose that you have dedicated your whole life to leather goods, and that you want to sell your products through the internet. It certainly seems like a good option. And surely you have read many guides that have told you about the low costs of starting an online business and the possibility of accessing the global market.

And it is true. But… do you know SEO? Email marketing? Do you know how to set up an online store? Do you know how to optimize the code so that it loads fast? Do you know how to do the latter, but also that search engine positioning is not affected? And i could go on a long list of questions.

The problem is this: either you start to learn a lot of things about online marketing and development that you don’t know, or you have to hire people to take care of it. Because otherwise no one will know that you are selling leather bags online. And if nobody knows, nobody buys you.

… Or the business itself

But, in addition, there is also the possibility that you have to learn about the business itself. After all, many people’s eyes light up when they hear the benefits of online entrepreneurship and they want to replicate the models they have been told about.

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A YouTube channel? A website monetized with Amazon? A podcast? This is all very well, but do you know about video editing? Affiliate Marketing? Copywriting? Sound editing?

If you want to start an online business based entirely on digital assets, you have to know how they work. Otherwise just you will not be able.

From these first two points one thing can be deduced that, although it is evident from a little thought, is not always present in the praise of online entrepreneurship: Creating a digital business has a high barrier to entry when it comes to knowledge.

If you are not willing to learn how to do it yourself, you are going to have to spend more (yes, more) money than you would need to start the same business offline.

Low economic barriers? Yes, but for everyone

Another important point to understand is that, although economic barriers are low (not others, as we have already seen), this is not always positive. It means they are low for everyone. Also for your competitors.

From an economic point of view this can be good, because it allows there to be a lot of competition and the service for the end customer is better. But this has two problems to consider, one general and one particular.

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The general is that it is not true, at least on the Internet, that greater competition generates better results for customers and end users. On the internet you can find ways to earn money yourself at the expense of the quality of service that the client receives. We are not going to stop at it, but it is so.

But the particular problem is more important (to you) than the general one. While entry costs are low for everyone, This does not mean that the one with the least money competes on equal terms with the one with the most.. Which brings us to the next point.

Investing is still important

Forget about “start your online business without money and become a millionaire in a few years.” Sorry, but that has a lot of myth. It is true that, without money and with a head (and a lot of work) you can achieve amazing things. But it is not normal.

The normal thing is that if, for example, you find a good niche to monetize with Amazon Affiliates, someone with more experience and money will find it, copy it, invest twice as much as you, and make your website stop receiving traffic and, therefore , money.

This is a reality that cannot be ignored. Those who have money can make greater investments in marketing. The only way to combat that is with a lot (a lot) of ingenuity. And even then it is not always possible.

And, in addition, all this has a corollary: if you start an internet business and it starts giving you money, you’re going to have to reinvest it all. That is, for a long time you will not be able to enjoy the fruits of your work and your investments, because almost everything you generate will have to be reinvested to continue growing and not be eaten by your competitors.

Very changing environment

Finally, we must mention a key aspect in the online world: everything changes. And it changes very fast. In the offline world there are certain truths that are maintained over time and certain businesses that it is very difficult for them to disappear in the coming years.

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But in the online world, both the business models and the communication channels with potential consumers are constantly changing. Think of search engine optimization, for example: every year there are thousands of changes to the Google algorithm. That instability is not for everyone.

If you want to start online, you must have a very particular mentality, capable of adapting to all kinds of changes and, also, of doing it quickly and decisively. Because in the time in which you are adapting the competition can take your place … And never get it back.

As you can see, Entry barriers to entrepreneurship in the online world seem minimal, but they are not. Although it seems that anyone can enter to undertake in any area, the truth is that it is not like that. You have to be very careful!


Source: El Blog Salmón by www.elblogsalmon.com.

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