An Alternative Approach to Fashion Entrepreneurship

A simple 5-step process is all you need.

Starting a company is something that anyone can do with a laptop and an internet connection.
Nonetheless, many newborn entrepreneurs fail to understand what entrepreneurship entails.

In this article, we are going to discuss a simple 5-step process to understand the business logic that should be pursued when starting a digital business.

Beware! These steps account for very little financial cost, but take a long time to be executed correctly: nothing in life comes for free.

Here are the five steps to building a digital business according to 440industries:
1. Learn to follow, if you want to lead 
2. Foster a community
3. Engage your audience and develop a product 
4. Test your product via crowdfunding
5. Market like there is no tomorrow

Step 1. Learn to follow, if you want to lead

Building a digital business is about building your own brand. Building a brand requires market knowledge and field expertise. This is why your first goal should be collecting information about your industry, and understanding who are the voices that people listen to. 

is, in fact, one of the most effective forms of influencer marketing, capable of pushing customers down the sales funnel, thanks to an individual’s authority. Studying influencers is essential to understanding your business and achieve the following goals:

  1. Defining your ‘Unique Selling Proposition’. They can allow you to identify a variety of value propositions which are already offered in the market and identify your own niche of expertise.

  2. Understand who are the most influential voices in your industry.  Listing and mapping the influencers in your industry can provide with a ballpark figure of the size of your market. By understanding the  ‘tones of voice’ used by authorities in your field you will be able to gather data regarding your audience and tailor your content so that it can be useful for them. Focusing on microbloggers can provide a unique insight into the market and assist you in designing your own positioning strategy.

Influencers may look like strangers at first, but may later become part of your own community. Not far from now, it’s likely that they will follow you, but first, you need to follow them.

Our advice is to start by creating a meaningful, honest conversation. Share their content, comment, like, subscribe, interact and make yourself noticed. If you start delivering value to their platforms, you are likely to create a personal relationship. 

Let’s see a few extra tips:

  • How can you bring this one step further?  It’s simple, try enrolling in Patreon and support the influencers you love financially. You’ll be able to figure out how monetisation streams work if you spend your own money! We also recommend backing Kickstarter projects for the very same reason: figuring out the best practices. We strongly believe that you cannot lead effectively if you have never been a follower.

  • Consider all of this effort as market research. Market research is necessary to make informed decisions and developing strategies that work in real life. The more you try things for yourself, the more you realise the professional standard you need to achieve to provide a persuasive business proposition to your customers.

  • Your business relationships are long term company assets. Relationships can take years to form, but it’s essential to keep expanding your network as your business grows over time. Despite its intangibility, one’s network is one of the most valuable assets you can create for your organisation. Take your time before moving ahead, this is a fundamental step towards your long-term success.

Step 2. Foster a community

The bigger the community, the more options you will have available to develop your business. After following, interacting and engaging with online users you will have developed your own ideas and opinions. This is an essential step towards creating your own voice and identifying what problem you want to solve for your customers. Here’s our advice:

  • Find out what type of platform better fits with your own message. Depending on your own personality and the type of information you are delivering choose among the platforms available. As you design your ‘message format’ you need to realise if you are going to deliver more value through spoken word, written word or images. Look for a balance between content and form as they are both equally important for your audience. 
  • Don’t disregard new and upcoming platforms. Being an early entrant into a new social platform can provide you with many advantages: your viewership will grow with the platform itself, suffering from much less competition that other, more established platforms.

This is where you can start building your own web presence via Youtube, Facebook, Instagram and so forth. Start lean, don’t invest, you have no need for it. 

At this stage, all you need is already provided to you for free. You need to focus only on providing value by fostering interactions and meaningful conversations.

Beware! Creating a blog, or a vlog, requires consistency and attention to detail, so by all means, by the time you reach this stage you can consider your business, at least a part-time job.

  • The keyword in this stage is authenticity. The more honest, passionate and open you are the better you will do. One of the founding values of the internet is the ability to match content creators (like yourself) with a niche, wherever they may be. If you succeed in building a community, it will be all downhill from here.

How long does it take? Years. No kidding. 
How long before moving to the next step? As long as you can afford it.

Moving ahead, let’s consider this. The reason you want to build a product or provide a service is that you need to monetise your work. But here lie two challenges, the first is to develop a product people will be interested in,  the second is actually getting them to pay for it. These are two separate challenges which will be addressed in step 3 and step 4.

Step 3. Engage your audience and develop your product

If you’ve done all the hard work so far, you will have a clear idea of your field of operation. You are slowly but steadily growing your audience by providing insightful, interesting, entertaining, content.  All of this, in marketer’s jargon, is called top-of-funnel interactions. You are putting your name out there, you are creating awareness but you are not selling anything yet. This is how it needs to be for now,  because it’s too soon to close a deal. 

The free and freemium revenue models – now widespread on the internet –  make it hard for people to sell profitably online, especially in the context of digital products. Consumers are now flooded with sales communications and promotions, making it very challenging even to collect emails through lead magnets. Marketing and promotional efforts are mostly perceived as distracting interruptions.

Whether we like it or not this is a challenge we all must face. We need to find out what kind of products or services would be helpful to our niche and what problem we can solve for them. The more painful the problem, the more likely we are to succeed if we solve it well. 

If you have created a community, you have a unique and valuable asset: a well-profiled audience. The community around you is going to be more likely to respond to questionnaires, interviews, or even opt-in to surveys. 

At 440 Industries we address product development on the grounds of consumer behaviour, and in this article, we go a little more in-depth on how that happens: Why Jobs to Be Done Theory Matters for your Business.

This is the stage in your relationship with your audience where you move down the funnel and collect qualified leads. This is a mid-funnel operation where we find out more about our target audience.

A useful way to develop an email list is by creating a risk-reward proposition, whereby you offer something valuable (technically called a lead magnet) in exchange for something free (your email, answers to a survey, a phone number etc.)

The information you collect is now primary research – or collected with a specific purpose in mind – allowing you to understand a problem and figure out how to solve it for your followers.

Is your service a consulting session? Good!
Is your offer a physical product? Better, it’s more easily scalable.
Is it a digital product? Jackpot, digital products have great profit margins.

With high-quality data, you’ll be better able to understand what kind of help your audience needs and how to make money while you help them.

This is when having attended a marketing course in college comes useful. You need to develop your own marketing mix with the 7Ps of Marketing (Product, Price, Place, Promotion, Physical Evidence, People) and create a prototype, or a minimum viable product to show how you deliver value. Don’t shoot for the Moon, just develop the cheapest, quickest proof of concept you can create. 

4. Test Your Product via Crowdfunding

Step 4 is where most people would stop and call it a day. But that’s wrong. At this stage, you may come up with a product that people may be interested in, but we still need to answer a very important question:

Are your potential customers willing to pay for your product?

This is what we need to find out, otherwise, all we’ve done is a very expensive brand-awareness operation. Looking at the bright side, this is when you get to start collecting money through crowdfunding.

Starting a crowdfunding campaign at this stage is the perfect strategy to assess how much your audience is willing to support you in the creation of a product, or how much they would be willing to spend to purchase it.

Managing a crowdfunding campaign is a full-time job. Make sure you reflect on this statement before you go into it. Moreover, take into consideration that on average crowdfunding project collect between 5.000 to 10.000 euros in funding and this is not likely to make you rich.

In our model, however, we will use crowdfunding instrumentally for market research and test whether people are willing to spend money to buy your product or service. Aside from the money itself, these are some of the additional benefits you will get through crowdfunding.

  1. Crowdfunding is the first institutional operation you will manage. It’s very much like operating a fully-fledged business. Running a campaign will give you the ‘real life experience’ of managing a digital company.
  2. It provides you with a very steep learning curve. Your project will need to account for many processes and timelines running at the same time. It will be an authentic managerial experience.
  3. It will help to do what you have already been doing. So far your job has been growing an audience, fostering a community, understanding their needs. A crowdfunding campaign will help you extend your reach and get funding while you are at it. 

If you do crowdfunding only for the money, you are better off going to a bank, as you are much more likely to find the resources you need, with much less effort.

The resources you will collect will finance the production or growth of your project and will put you in the perfect spot to attract further more consistent funding. After having completed this stage, you will also be able to speak to potential professional investors and provide a persuasive argument.

Your business now features:
An interested and purchase-ready audience.
A real, and market-tested product.
A wide community for indirect monetisation (for instance through advertising).

5. Market like there is no tomorrow.

Maybe, this is where you would have started if you did not come across this article. After reading this, before spending your fist euro, in advertising, you have a much better understanding of your market, you have developed a degree of authority, and the proof of your expertise can be easily found and tested.

Digital marketing strategies would account for yet another long-form post, nonetheless, so many resources are available online, that it will take you very little time to get started with digital marketing.

Just one word of advice: in digital marketing, no right answer stays right for very long. Always test your assumptions, test your strategy, test your message, test your claim. A/B testing is your best friend and a  cautious financial ‘advisor’.

Also, make sure you play by the rules. Don’t rely on black-hat strategies, as by now you should have realised that you’re in for the long haul, and any get-rich-quick scheme will only corrupt the foundations of your organisation. If you lose your credibility you lose your business.

6. Conclusions

That’s all folks!

These were the 5 steps we recommend to grow a successful digital business. Don’t get fooled, it’s hard, risky and frustrating. Entrepreneurship provides access to a wide spectrum of human emotions and pushes each of us to test our limits and beliefs. It’s a journey that changes all of us and must be approached with clarity and awareness. 

If you’d like to learn more about digital marketing strategy, find below some useful sources to become an expert!