Building your own business webchat

As part of the Barclays Online Business Fortnight we hosted a webchat with a panel of experts who answered your questions on how to build your business.

The experts were Dan Posner, head of innovation optimisation and performance at Barclays Business, Justine Roberts, co-founder and CEO of Mumsnet, and Chris Spurr, web design and user experience expert at Redwood, the leading content and marketing agency.
 

Starting out

Q. LovesBeingOnHoliday: I want to start a business but just don't know what in. It needs to be something I can fit around work and probably internet-based, but how do I find something that's not already overdone?

A. Justine: I think it's really important to fill a need. The best businesses are ones that identify a problem and solve it for people. It helps if you're interested and passionate about the product/solution too.

It's not always easy sailing. In tough times what keeps you going is believing in what you are doing, irrespective of whether it's going to make you a fortune or not. Hope that helps and best of luck!

Q. Katelouc: I have a business idea but I'm not sure how I can actually turn it into a profitable business. Are there any advisory services out there? I don't know where to start. I need to feel confident about the idea and have a clear pathway to follow in order to succeed.

A. DanPosner: Try the British Library IP Centre. If you're in London they are a great place to visit. If you're not in London, they should be able to advise you about business centres that are closer to home. 

Q. Farrowandbawl: When you first started up, what was the thing that helped you the most? What is it that you know now that you wish you knew then to make things easier for yourself?

A friend of mine has a great idea for a business and it's starting to take off but she's scared. I am too for her. We both know this can be big and long-lasting if we do it right.

A. Justine: Well, it's a wee bit cheesy but truly the Mumsnetters were really helpful from the launch onwards. There weren't so many back then compared to now, but they were very forthcoming with feedback, suggestions and genuine support. In the early days they sent us money to keep going!

I also think what helped was having a clear vision of what I wanted to build. I really believed that by allowing folks to pool knowledge it could help make parents' lives easier. Over the years everything we've done has been seen through that prism. I always think:

  • Is it useful?
  • Will it make parents' lives easier?

If not, we don't do it. It's very helpful to know what your purpose is when you're deciding what to do and just as importantly what not to do.
 

Market research

Q. Babytigerno1: I am a mum who is trying to start an online childrenswear range. I studied fashion design at university but I really don't know how to set the business up. I am currently conducting market research but not many people respond to my survey. What should I be looking at?

A. ChrisSpurr: There a few options out there:

  • You could pay an agency to do some research on your behalf, but this can end up being very expensive.
  • A more affordable option is to make an event of your market research. Hold a coffee morning for other mums in your area and bring along your questions. Be upfront about why you're bringing everyone together and make sure you provide good snacks.
  • Collar parents at pick-up time for two minutes just to get some quick answers without anything as formal as a survey.

Don't give up though, market research is crucial before you start. If you need more general information about your chosen sector, you can buy online market research papers, from organisations, such as Mintel

A. DanPosner: At the risk of sounding like I have an interest in promoting them (and I assure you I don't) the Business and IP Centre at the British Library is exactly what you are looking for. They give you access to all of the marketing survey reports and databases that can help you answer your questions.

It's also a great place for inspiration. Several of the entrepreneurs that started there who have been successful are showcased. The centre should be able to put you in touch with units around the country that offer something similar. 

Q. Giveamonkeys: Do you think CSR/charitable engagement could/should play a part in founding a business?

A. ChrisSpurr: It's always good to try to include some way of giving back. In some industries, this carries more weight than others and can actually be a great way of spreading the word about your business and getting some positive PR - sorry if that sounds a bit commercially minded and not too benevolent.

Of course, the most important thing is that you could be doing some good and this is certainly something that lots more businesses are incorporating into their business plans nowadays.

A. Justine: Interesting question. When I think back to pretty much the first half of MN's existence, we just didn't have the cash or bandwidth to do anything other than soldier on. Admittedly, we didn't really earn enough to pay ourselves for about six years and that felt like our charitable contribution.

When I started looking at how MN could formerly incorporate fundraising into what we do, eg with a foundation type thing, I found it pretty darn complicated involving forming a trust and having trustees etc. We've decided to have an annual match-funded giving week instead. (It is starting next spring.)

If someone could come up with a simple solution to corporate giving, that would be ace. I'm thinking of something where you integrate with companies and you can elect to give element of profits to charity as part of a government scheme, witout complicated legals or tax stuff involved.


Distractions

Q. InMySpareTime: How do I best tackle the general assumption that because I'm working from home I'm not really working?

People, including friends and teachers, assume that because I'm at home I can go out for a cuppa, nip to the shops for them or look after their kids so they can do their work.

I know, I need to grow a pair and tell them all to shove their little errands and that my work is important but I'm intrinsically nice - and inherently British - so I allow myself to get walked over then seethe about it.

Any good phrases I can use to make the point that WAHM is different from SAHM? I'm not denigrating SAHMs by the way but I need to concentrate to get my writing done. I don't work well when constantly distracted.

A. Justine: Just be firm and say, I'm sorry I can't, I'm working. Keep banging on and the message will get through eventually.

Q. MakeMineAKorma: I'm in the early stages of setting up an online business, and it has heaps of promise but I am really struggling with finding time to do as much as I want. I have two young DC and am pregnant. Social media is great for getting my name out there but it is SUCH a distraction and I often find myself on Mumsnet. Any tips on how remain focused so that you actually get things done?

A. Justine: Prioritise: each day make a list and put the two or three important things you really want to address today at the top. Don't let yourself do other things - even Mumsnet - until you've done them.

I find it quite useful to sometimes turn the WiFi off . Twitter, Facebook and Gmail have all spent a lot of time, energy and money designing things that will grab your attention and distract you. Sometimes the only way to get on with stuff is to disconnect.

 

Finances and investment

Q. HRHLadyG: Where is the best place to go for advice on initial investment/loan for a new business in terms of buying/renting a property and refurbishing it to make fit for purpose?

A. DanPosner: There are literally lots of places. The first place I would start is very close to home. Put a simple business plan together. There are loads of templates and examples available online.

Test it on family, friends and literally anyone else you can find. Find out what they think is a good idea and what will and won't work.

I would then contact, your local enterprise agency or business library. In London, for example, the British Library has a whole unit where you can carry out research, get ideas and swap skills with other entrepreneurs. The librarians are brilliant. They can provide lots of free advice on the direction for your business. There is something similar in most big cities; it's just a matter of hunting it out. They will probably be able to put you in touch with other people that can provide specific advice on the area you're interested in.

"Put a lot of effort into a three to five year plan and making very realistic assumptions based on solid research. Find similar businesses and look at how they've grown revenues and profits. Basically make sure you can justify every number in your plan."

Q. Yiska: I'm in the process of putting together a business plan to try to secure investment but it feels like a bit of a catch-22 situation: no one wants to invest before I've got a product that has a track record, but I can't launch the product without any investment.

Do you have any advice on getting over that first hurdle and convincing someone to invest in what I think will be a fantastically brilliant product?

A. Justine: As someone who singularly failed to raise any investment, I'm probably the wrong person to advise. I do think I had a very poor business plan based on pretty much thin air. Then the market collapsed.

I would advise putting a lot of effort into a three to five year plan and making very realistic assumptions based on solid research. Find similar businesses and look at how they've grown revenues and profits. Basically make sure you can justify every number in your plan. You might end up being wrong but you'll sound convincing. Good luck!

Q. WinterBabyof89: My questions are related to the finance of starting up a business, specifically in the bridal sector.

My husband is already a business owner so I have plenty of experience to tap into -albeit in a different area and my mum has a diploma in marketing.

What my sister and I do not have is a great deal of start up funds. How much would a bank be able to lend to start us off? What interest rate would this be at?

Between 70% and 80% of the money will be spent on stock that will remain unsold so could this be used as a guarantee of some form?

I appreciate that you won't be able to give specifics, but just an idea of some sort would be helpful. I appreciate any advice. 

A. DanPosner: This is a great question. Most banks offering start-up accounts will do everything they can to support new businesses in terms of marketing education, business planning, networking events and available support. It's in their interest to make sure that new businesses succeed.

They often wait 12 months or so before starting to offer loans, to make sure that the business is making money and managing their accounts OK. Therefore new businesses often start off using funds from savings or have borrowed from family and friends.

There are often schemes that are available locally. It is worth going in to speak to a business manager in a branch to discuss what options might be available in your area.

Q. Paulapg: I have an idea to provide information to the public. As this would be online and I would not be selling any products, how do I make money from my website?

I could possibly sell items that related to the area in which I will provide information but I don't really want to have an online shop and hold stock. Plus, it would not be a large number of products.

The information on my website is about products, so some form of advertising could be an option. I don't want to make the website too complicated but would obviously like a good financial return.

A. Justine: Think about why people come to the site and what they might be prepared to pay for. Is there some part of the information that is very valuable? Maybe you could offer to package it up or deliver it in a way that adds value like a subscription newsletter. Perhaps you could add a forum so folks who come can share a conversation around the info you're providing. Forums are usually quite good for traffic, so you can monetise by selling ads.


Accounts

Q. Angelart: I set up a small business as a face painter in April this year. My work is predominantly bookings on a weekend but not every weekend. I would like to have an account to keep this income separate from my personal account. I want clients to be able to pay into it or use a credit card or cheque to pay for their purchases.

Does this have to be a business account? Could you advise what would be the best and least costly way of doing this?

A. DanPosner: It would definitely be worth opening a business account. It makes it much easier with the taxman at the end of day, particularly if your business starts to grow. Most banks also offer free banking for an initial period of 12 months or so.

It also pays to think about how you want your customers to pay you. Cheques can be a pain because you have to wait for them to clear and then get down the bank to cash them.

Have a look at payment methods such as Barclays Pingit, which gets the money into your account instantly by someone tapping in your mobile number.

Some new card readers plug into your smart phone. They are good value for your money and you can use them wherever you have signal. There are a few on the market.

Q. RubyRR: We are looking for business bank accounts. There seems to be more exciting offers open to customers setting up a company through an online agency rather than dealing directly with Barclays. Is it possible to get a similar deal, eg cash back and free accounting software direct from Barclays?

A. DanPosner: Setting up a company through a formation agency is a great way of setting up your business as a limited company. You need to check that setting up as a limited company is right for you. Depending on your circumstances, you might be better off as a sole trader.

Assuming, that a limited company is right for you, then dealing directly with Companies House to register your company is also an option.

For Barclays start-up accounts, banking for the first 12 months is free, and you get access to Connector, which is an online community that can help you find suppliers and new business leads. Barclays also offers accountancy software, online marketing courses and a whole load of other help for new business, some free and some not.

The stand out aspect of the Barclays account though, is that it rewards customers for loyalty, both the length of time and the amount of business customers do with Barclays. Barclays also offer a service guarantee that says if anything should go wrong, we'll give you a named point of contact who'll take personal responsibility for resolving the query and keeping you informed.

It's worth checking out more details here.
 

Marketing and promotion

Q. VelvetStrider: What is the best strategy for marketing to small, creative businesses? In the last decade, email marketing has generally been the preferred method, with rising postage costs and a backlash against high volumes of junk mail.

However, I'm wondering if things are now coming full circle? I get a huge amount of marketing emails, most of which I don't even open, yet the postman puts very little through my letterbox.

Is it now worth the extra cost to send information to potential customers by snail mail?

Also, if I do send marketing by email, what sort of wording should I put in the subject line to tempt people to open and read the message?

A. ChrisSpurr: Great questions! When it comes to marketing, it really depends on who you're trying to reach and how you think they will react.

A great example of a small agency promoting themselves is a small London studio, Mat Dolphin. They 'rose to fame' when Creative Review celebrated their first anniversary on Twitter. Mat Dolphin decided to design and print a lovely poster for them and had it delivered to the Creative Review offices. CR tweeted the poster to their 90,000 followers and the rest is history.

In terms of subject line for email marketing, do as much testing as possible. Use a control group and test one subject line versus another and see what your audience responds to. Obviously, avoid words that might end up flagging your email as spam, eg free, sex, viagra, etc. If it's possible, personalising the subject line, eg Hey Jane, can really help your open and response rates.

Q. Whistleforit: Inspired by the reasons for setting up Mumsnet and our own experiences, we run a business www.villas4kids.com that provides fully-stocked/child proofed holiday homes for families.

I am never sure how to use Mumsnet best for it. I am nervous about mentioning it if it breaks the rules and we only have modest budgets. MN seems more targeted than Facebook but is that right? How do I start?

A. Justine: What a good idea! I'd say think about reviews and free publicity first. Maybe offer a few press trips and make sure you get happy customers to review, if you can.

As you say, Mumsnet sounds bang on your target market, so as and when you've got some budget, come talk to us.

In regards to mentioning your business on the boards, it's fine if it comes naturally in the conversation. Spamming and signatures is another matter.

 

Hits and purchases

Q. Thethighshaveit: I have a website that lots of people visit, but they don't buy things. What am I doing wrong?

A. ChrisSpurr: Look at your analytics and find out where you're losing people. Are they bouncing from your homepage? If so, check where they are coming from. They might not really be target market or they might just be put off by your homepage (sorry!).

Do some user testing and see if people are responding to it and that they can find their way around. Nothing turns off users like difficult to navigate sites.

Are they falling off at basket/checkout stage? Or anywhere else? You have to track down where along the 'customer journey' you're losing them. Then start to do some multivariate testing to see how you can fix the problem.

Consider these options:

  • Bigger product images
  • Better descriptions
  • A simpler checkout process
  • Could you accept other payment options, such as Paypal?
     

Advertising

Q. RubyRR: We are in the process of developing a hobby into a business. How do we price advertising for our website?

A. Justine: I'd say the simplest thing initially is to go for a set price for a set format regardless of whether it's an advertorial or display advertising. Take a look at Mumsnet Local - the 'advertise your business here' button on right hand side by way of example. Try to automate it as much as possible and vary the price according to supply and demand.

When you get bigger, you will probably move to a more stats-driven model. Sites like Mumsnet will price ads according to page views (CPMs or cost per thousand views). The going rate is anywhere from £5-£50 per 1,000 depending on ad format, targeting etc. 

Q. GNicholls: I run a website that is getting approx 3,000 unique hits per day. I have Google Adsense but was wondering how I go about getting private advertisers on my website? 

A. Justine: See my answer to RubyRR, depending on your customised settings. Also you could create a page saying "How to advertise with us and why you should" and run your own ads directing folks to that page.

A. ChrisSpurr: You could look into using smaller, niche advertising networks, that target audiences really well for your business. I'm most familiar with ones I associate with creative industries. Networks like influads.com and carbonads.net can be great for facilitating this sort of thing.

 

SEO

Q. Episode: We run a pretty successful online business from which 80% of our customers were coming in online - from Google to be precise.

With the various Google updates, we have seen hits of 300 a day go down to 40 on a good day. I won't pretend there was no 'bad practice' SEO in the old days but for at least the last year we have been working hard to do things the correct way.

It is really hard to find comprehensive advice and online - there is so much contradictory information. We suspect the largest problem we have is that our links (of which there are hundreds) are all associated with spammy sites that have also dropped in rankings.

We have had no email from Google to suggest we have been individually penalised. Is it true we would have one if we were the case?

Is there a single easy way to remove the links already in place without contacting their webmasters? Most of whom have now moved on as you can imagine.

We have just started to use PPC and we are not yet seeing an improvement in conversion but I have been told that to find the best keywords, phrases etc often takes time. The main reason we are doing this is in hope that it improves our SEO one and so we can diversify our acquisition strategies. With regards to improving our SEO, is it worth doing any of this, or any new SEO, with our previous issues still in place?

Is there any single way to find out that our suspicions with what our issues actually are, are correct?

A. ChrisSpurr: This is a really tricky area, and as such there are lots of expert sites and agencies out there. I will try to help.

Unfortunately, there could be a number of reasons for your drop in Google traffic. It sounds like the old links could well be part of the problem and I'm not sure of any quick way to resolve that. Make sure you do a full sweep of your site and check your structure is up-to-date:

  • Are you using heading tags properly etc?
  • Is there any duplicate content?

I think you would only receive an email from Google if you were fully blacklisted. It sounds more like there is something in the newer algorithms that isn't sitting well with your site.

You're right, PPC will take time but as you say will help diversify your acquisition. It could be worth sticking with it, especially if organic results are dropping. Keep an eye on what's working and what isn't and make adjustments where necessary.

Overall, I would always recommend you write and create sites for users, not search engines. Google will always catch you on any 'tricks', so I wouldn't try to push it too hard.

There are some good online SEO reporting tools that you can plug your site into to check if there are any big issues. There are also SEO agencies that will do a report on your site.


Social media 

Q. ThePennineWay: We own a small hotel and so far have not used Facebook or Twitter to market ourselves. How useful is social media to businesses like ours? Our average guest is probably 40+. Would you recommend we get involved and, if so, can you recommend any useful guides to help us get started?

A. ChrisSpurr: Social media is great for recommendations, which as a hotel is exactly what you need. The 40+ market do tend to trust peer recommendations a lot. Sites like Trip advisor have a huge impact in the hotel industry, so it's definitely worth looking into promoting yourselves on there and other travel sites.

You can set up Twitter alerts for posts about your area, with tools like TweetDeck or HootSuite so you react more quickly.

If you offer "added value" tweets about fun things to do during people's stay etc, you will set yourself up as a local expert and trusted source. A Facebook page could also be a great place to showcase your local knowledge and sell your lovely hotel in the process.

If you're looking to read up on the subject, Econsultancy and Mashable are great online resources for social media. Econsultancy has whitepapers you can purchase or you can access their blog, which is full of great stuff for free. 

Q. PeteCampbellsRecedingHairline: How often should you be tweeting and posting on Facebook in a day? Furthermore, what content should I be sharing to encourage people to interact?

I'm finding I am getting more interaction on Twitter with other businesses but Facebook is quiet. Is that normal?

A. ChrisSpurr: There aren't any hard-and-fast rules about the frequency of your tweets/posts. The more regularly you update social media the better, but not at the expense of quality. You'll lose followers if you're posting rubbish or irrelevant information.

Find a tone of voice that works for your audience, eg chatty, formal or funny. Stick to that tone and it will help you work out if something's worth posting.

Keep an eye on your followers, too. If a particular tweet gets them talking, try more of those. If you drop followers after a tweet, avoid that style in future.

"Facebook can be a great place to start with paid-for marketing because you can tailor your ads really specifically and only have them show up in relevant people's timelines."

Q. Johnworf: Do you think that paying to promote posts on Facebook works? If so, what is the average ROI?

Also, I'm interested in any tips on being a better business blogger. What would you say are the key elements to engaging your customers? (This could also apply to Pinterest content.)

A. ChrisSpurr: Facebook can be a great place to start with paid-for marketing because you can tailor your ads really specifically and only have them show up in certain relevant people's timelines or pages.
eg Only men in Wales who support Arsenal.

This means you can test out what works for your audience right from the beginning. Additionally, you can set a budget cap, so you won't overspend.

In terms of ROI, Facebook marketing reportedly outperforms a lot of other online advertising but I'd need to get back to you with exact data.

When it comes to business blogging, make sure you're up to speed on developments in your industry. Post regularly and confidently. Pitch it at the right level for your audience (no jargon or overly technical language). And remember to take note and respond to comments, good and bad. Mixing up the style of posts can help keep people engaged too.

When you've posted, make sure you post about it on your social media, too.


Partnerships

Q. Nobutreally: I'm self-employed and have been running my own business for over nine years (B2B/consultancy area). I am currently looking to partner up with a couple of long-term mates to create more of a brand/identity. What do you think are the advantages and disadvantages of going into business with people you like?

What business format should we look at? We're thinking informal partnership but people keep trying to push us towards Ltd company.

A. Justine: Working with friends is a great idea. You do spend a lot of time working, especially if it's your own business so it's good that you get along.

Make sure to be very clear about structure and responsibilities and keep communicating. Build regular 'get it off your chest' sessions in to your plans as people's motivations and ambitions can change but you still want to stay friends!

A. DanPosner: It's difficult to give advice on this one because it very much depends on your personal and business circumstances. This link provides a quick introduction but if you have a good accountant I would start with discussing it with them.

Q. ReLIKEAbbe: Our two-year-old start-up business www.relike.co.uk is a website for parents to buy and offload their children's good condition outgrown clothes in bundles, in return for vouchers and a high feel good factor.

We give to charity when a bundle sells, the customer get credits and make another mum's day. It is social enterprise with the mission of encouraging reuse rather than recycling or worse. Our collaborative consumption model is unfamiliar and new in the UK but it is scalable and solid.

Who do we talk to within large retailers (for cross-promotion purposes) or at logistics companies to discuss collaborations and forge new business relationships? So often it seems sales people are reticent or unsuitable, while getting hold of the CEO is unrealistic. Who is in-between and what roles, department names, should we be seeking out?

A. Justine: Fab idea! You might want to try the corporate responsibility or communications bodies. Search for companies that talk about sustainability and/or reduction of waste as part of their mission statement or core values. They might see collaboration as a social responsibility and want to work with you accordingly.


Expanding

Q. Adair: I run drama classes for kids in Walthamstow. I'm not sure about you but I kind of want to do everything. I see opportunities for pop-up shops or classes for little ones and adults and think I could do that. Do you have a strategy for deciding which avenues to say yes to? Do you regret any of the places you said yes/no to?

A. Justine: It's a very good question and one I wrestle with all the time. There's so much we could do.

One of the things I've learned with regard to digital products is that you can't just develop something and move onto the next thing. Developing it and releasing it is just the first stage. You need to hone and refine and keep refreshing it. Here are a few things to consider: 

  • Focus on what's unique about this idea
  • Think 'Why can I do it better than anyone else?'
  • And 'Am I prepared to keep working on it?'

If it passes all those tests it's probably worth doing, but don't spread yourself too thin. It's better to do a few things really well than do a mediocre job of lots of stuff. 

 

Head to Barclays on Mumsnet for lots more:

 

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Last updated: 29-Jan-2014 at 10:28 AM