By Gergo Vari
For anyone planning to start an online business, just like any new business,
surviving the first year in business is critical. And if you have a keen understanding of the trends and commonalities among successful new online businesses, you are far more likely to get off on the right foot.
In this article, we’ll look at some of those trends and the common characteristics of successful online businesses. While the key fundamentals described in this article do not represent an exhaustive list, they should provide you with an understanding of the landscape of online entrepreneurship and where it will be going in 2023.
Key online business trends for 2023
1. A shift toward a subscription-based economy
Today’s economic landscape is as volatile as ever for entrepreneurs and consumers. Globalization and an increase in mobility have not given us more stability, but rather more interlinking and ever-shifting factors that can cause widespread repercussions and an increase in volatility.
Therefore, stability remains a strong selling point for both business owners and consumers alike. Just as businesses like to know how much income they can expect to generate in the coming months or years, consumers also want to know what expenses they need to prepare for.
This fact, along with the rise of digital platforms and products, contributes to the shift we are seeing toward subscription-based services. For example: whereas prior generations would pay for individual phone calls, today’s consumer subscribes to a monthly plan; whereas moviegoers 20 years ago would buy tickets to individual shows, today’s consumer has an online streaming subscription (or a monthly or yearly pass to their local theater).
Whether we’re talking about physical products, such as cars, homes, security systems, etc., or digital products, outright ownership is becoming more and more difficult (due to inflation and the frequency in which products become updated and thus prior models become outdated). In consequence, outright ownership is becoming less and less important to today’s average consumer.
From the consumer’s point of view, subscription-based products and services offer security in the face of threats of inflation. They also guard against owning products that are likely to quickly become outdated. From the entrepreneur’s point of view, subscription-based products or services offer a more steady cash flow as well as greater accuracy in growth projections.
There is no reason to predict that the prevalence of subscription-based products and services should experience a decrease in 2023. In fact, the opposite is the more likely scenario.
2. Niche marketing instead of mass marketing
More and more online entrepreneurs entering the market means there is more and more competition and in some instances, a saturation of certain markets. Where new businesses are showing the most success is in exploiting niche markets.
Beyond being far less saturated than mass markets, niche markets present other advantages to entrepreneurs. Niche markets come with a loyal customer base eager to be serviced. The customers that make up a niche market are easier to identify, and consequently, to market to. In most instances, the cost of marketing to these customer bases are far lower than when marketing to a mass-market customer base. A lower initial marketing cost is very attractive to business owners just starting out.
Focusing on niche markets means online entrepreneurs need to pay special attention to how they build brand identity. When done successfully, they will appeal to and win over a customer base that has shown to be loyal and supportive.
Starting off by focusing on a niche market doesn’t mean that your business needs to stay there. But as we look ahead to 2023 and beyond, niche markets represent significant advantages for online entrepreneurs.
3. Remote work
In the last 10 years, we have seen an increase in remote work opportunities for digital nomads, contract workers, and salaried employees. This trend received a huge boost during the Covid-19 pandemic. There are too many advantages to remote work for both the employer and the employee for it to fade away any time soon. In fact, experts predict
remote work will increase in 2023.
For online entrepreneurs, this is very good news. Remote work means a significant reduction in overhead costs: less or no office space and the costly supplies and infrastructure that come with it. Additionally, by favoring remote work (or at least offering that possibility to your employees), you will increase your chances of attracting and retaining top talent.
Developers continue to make advancements in online platforms and software to help remote workers increase their
productivity and strengthen their communication and collaboration. Remote work software allows teams to collaborate seamlessly on projects, meet reporting requirements, and work cohesively as a team, even when members are not in the same location.
4. Artificial intelligence on the rise
Though we have seen significant breakthroughs in the development and application of artificial intelligence (AI), we have only scratched the surface of what this technology can do. In 2023, we will surely see an increase both in terms of what AI can do and also in how we choose to implement it.
AI helps to greatly reduce (if not outright eliminate) repetitive and/or menial tasks. This frees up workers to apply their skills in more creative and productive ways. As an online entrepreneur, the implementation of AI in 2023 will allow you to offer more consistent and engaging
customer service and even make your customer service more proactive.
Successful entrepreneurs will leverage trends
One significant advantage new online business owners have over more established and larger companies is in their maneuverability: the entrepreneur’s ability to quickly adjust, shift focus, and adapt to new factors shaping the market (in particular, the factors that define consumer needs and expectations).
Successful entrepreneurs make full use of this advantage. The current trajectory points toward a market that favors online entrepreneurs who quickly identify new trends and then adjust their products and services accordingly.
In recent years, we have seen consumer expectations lean in favor of such trends as green energy and environmentally friendly products and services; embracing diversity and inclusion; the brand as identity assertion; etc. The challenge for online entrepreneurs in 2023 will be to identify current trends that affect consumer habits and expectations, predict future trends (or at least the viability, increase, or decrease of current ones), and be flexible enough to successfully leverage these trends.
To understand (if not predict) the trends that matter to your customer base, creating and fostering channels by which your customers can engage with your brand is crucial. Social media platforms provide opportunities for online businesses to engage with their customers. Additionally, AI-powered customer-service management software, digital marketing software, blogs, and interactive websites are common tools used by online entrepreneurs to stay engaged with their customers.
Another great way to keep your finger on the pulse of your customer base and gain a greater understanding of what trends matter to them most is by embracing diversity in the workplace. A more diverse workforce greatly increases your chances of identifying with your customers, understanding their needs and expectations, and thus being able to leverage the trends that matter in 2023.
Starting an online business in 2023
Advancements in digital technologies have made it easier to
start a business than ever before. In consequence, a large segment of today’s consumers favors small, independently-owned businesses over the more traditional corporate model. This means that in 2023 and beyond, being an online entrepreneur will be more attractive than ever.
In order to stack the odds in your favor, attract top talent and keep overhead costs low by leaning into remote work and the implementation of AI, embrace the shift toward a subscription-based economy and the increased prevalence of niche markets, and prioritize customer engagement so as to be able to identify and leverage trends as they become more relevant.
About the Author
Post by: Gergo Vari
Gergo Vari is CEO of Lensa. He has one mission: to revolutionize job search for companies and professionals. His journey through founding, funding, and exiting successful startups has taught him a valuable lesson: the hiring process is broken. Thus, he shares the desire for recruiting and human resources technology that puts people first.