The business news headlines are full of scary trends and volatility – high inflation, rising interest rates, tech company layoffs, declining stock prices, and the recent shocking failure of Silicon Valley Bank. But if you look closer at the everyday “Main Street” of the digital economy, the reality is less scary and much more hopeful.
Many small online businesses, such as ecommerce stores, content-based websites, mobile apps, and software solutions, are still innovating and making real money – some are recording annualized returns of 25-50%. And many of these online businesses, unlike some other asset categories in recent years, never got overpriced and overhyped. Instead, this is an entire sector of the tech industry that has just quietly kept generating revenues and serving their customers.
A recent survey of online business owners, Recession Impact on the Digital Small Business Economy, found that 40% of these entrepreneurs are “bullish” on the economy. Only 25% said they are “bearish.” 58% of online business owners expect to see growth of 11%-50% during 2023, and they’re getting ready to place bigger bets on future opportunities: when asked what is their Golden Rule of entrepreneurship for 2023, 36% of online business owners said “Invest for growth. Now is the time to place a bet.”
Even after the tech stock downturn of 2022, even with the uncertainty and layoffs throughout the Big Tech economy, it’s noteworthy that so many online businesses are still expecting to see business as usual – or better – in their own operations.
Let’s look at a few recent online business trends that suggest a bright future for small online businesses and digital entrepreneurs in 2023:
The Draw Towards Authenticity
Ecommerce is one of the most popular business models for online businesses, and it’s OK for your online business to be a small, niche ecommerce website. You don’t have to be Amazon to be successful in the online retail space. There is plenty of opportunity for smaller online businesses that sell online.
In fact, one of the top retail trends for 2023 is “authenticity” – building relationships with customers by creating trust and offering a unique experience. Not every customer wants to buy from a big brand or buy from Amazon; many people are looking for a more personal, authentic connection with the companies where they shop. This is a big opportunity for small online businesses to boost their share of the online retail market.
Strong Digital Customer Relationships`
One of the biggest challenges for online businesses, especially for ecommerce companies, is getting repeat customers. Ideally, businesses want customers who will buy from them year-round, not just during the busy holiday shopping season. Small online businesses are well positioned to build digital relationships with their customers, in a way that is responsive, adaptable, and personalized.
There are many apps and technology solutions available now to help online businesses analyze data, send targeted marketing messages, buy effective online advertising, and otherwise improve their customer relationship management. But along with technology, small online businesses are often able to create deeper customer relationships because they are small. They are closer to their customers, and they know their customers better than the big companies.
Owning Niche Markets in Wellness
One of the fastest growing markets right now in retail is the beauty and cosmetics industry, with customers showing strong demand for beauty and personal care products. This is part of a larger shift after the pandemic, with people trying to take better care of themselves and improve their personal wellness.
Small online businesses are ideally positioned to be part of this booming market – because they can create a unique, personalized customer experience, source innovative and bespoke products, and build a brand with a reputation for authenticity.
Try New Things + Pivot Quicker
Another advantage for small online businesses is, because of their small size, they’re able to experiment, innovate, and create new business models. Small online business owners have the power to try new things and pivot quickly, without the bureaucracy and overhead of a traditional brick-and-mortar company.
For example, here are a few top small business trends for 2023 that are a perfect fit for online businesses to explore:
- Hyper-local marketing: get to know your local community and drive support for your business as a local business.
- Personalized customer experiences: the more you can deliver a customized, individualized experience for your customers, the more loyal and profitable those relationships can be.
- Customer reviews and social proof: getting good reviews from your customers can be a game-changer for your online business; small businesses can be proactive and creative at asking customers for reviews, inviting their customers to talk about them on social media with user-generated content, and rewarding their most loyal customers. Your best customers can also be your best salespeople!
No matter what happens next in Silicon Valley or on Wall Street, it’s clear that online businesses are here to stay – and there are big opportunities in 2023 for small online businesses. Whether it’s an ecommerce website, a mobile app, or a revenue-generating blog, there are many ways for digital entrepreneurs to drive growth in the year ahead.
Blake Hutchison is the CEO of Flippa, the #1 marketplace to buy and sell digital small businesses such as websites, ecommerce stores, mobile apps and SaaS businesses. Blake has worked on leadership teams assisting in fast growth businesses including Xero and Luxury Escapes. Among his start up experience, he also founded a company…he then used Flippa to sell the business.