It is crucial for today’s entrepreneurs to grasp the concept of digital business. In this age of disruption, entrepreneurs must venture into the digital realm promptly to ensure survival. Before delving deeper, let’s elucidate the essence of digital business.
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What is a Digital Business?
Digital business refers to a business that leverages digital-based technology to execute its operations, encompassing both product creation and transactions involving purchasing and selling with customers.
Another simplified explanation of digital business is a venture that employs technology, such as selling products on the internet through social media and existing marketplaces. Digital business extends beyond products and can be applicable to service-oriented enterprises.
Beyond sales, the digital landscape can be harnessed for marketing objectives, namely digital marketing. Products or services can be promoted on the internet to access a broader market and elevate sales figures.
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Types of Digital Business
What is a Digital Business, Types and Benefits
Having understood the essence of digital business, the time is ripe to delve into its categories. Various models of digital business exist today. The most straightforward is a business engaging in buying and selling transactions on the internet.
However, there are several digital business types. In Indonesia, digital business has flourished considerably and continues to evolve. The ensuing are prevalent forms of digital businesses:
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Ad-supported
As the name implies, this type of digital business thrives on revenue generated from advertisements. Typically operating on diverse social media platforms, this business capitalizes on the cost-free nature of creating social media accounts. Ad-supported companies exploit this advantage to profit from ads, promotions, or sponsorships exhibited on social media platforms.
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Subscription
This variant of digital business thrives on subscription fees paid by customers. Examples encompass streaming, reading, gaming, and other entertainment platforms. This model stems from the transformation of traditional methods where individuals subscribed to newspapers, magazines, or services. These services have since been digitized into subscription-based formats.
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Marketplace
Marketplaces employ platforms for buying and selling provided by service-provider companies. In Indonesia, prominent marketplaces employed by entrepreneurs encompass Tokopedia, Bukalapak, Shopee, and others. Marketplaces simplify online transactions for sellers and customers alike. In addition to facilitating smooth transactions, sellers benefit from a broader and more accessible market.
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E-commerce
Although often mistaken for marketplaces, e-commerce differs significantly. While marketplace businesses utilize third-party platforms, e-commerce enterprises directly market their products or services without intermediaries. For instance, a company employs a meticulously designed website enabling customers to peruse a catalog and make purchases directly.
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Advantages of Establishing a Digital Business
What is a Digital Business, Types and Benefits
Digital business holds immense importance for entrepreneurs in today’s era. Businesses embracing digitalization are better poised to weather uncertainties. Failure to adapt to the digital landscape can render even sizable companies vulnerable.
Technological progress simplifies tasks, including transactions. Building a digital business offers companies several advantages. Here are some noteworthy benefits:
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Lower Initial
Investment Digital businesses require minimal capital. Entrepreneurs can initiate their ventures with meager funds. With only a smartphone and an internet connection, one can commence the desired business. There’s no need to lease physical spaces since products are marketed online.
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Expanded
Consumer Outreach Digital business transactions transcend geographical and temporal constraints. Entrepreneurs can interact with customers worldwide. The internet and digital marketing empower entrepreneurs to reach a broader consumer base compared to traditional brick-and-mortar establishments.
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Enhanced
Profits A broader consumer base correlates with increased benefits for companies. Eliminating the need for costly physical spaces further contributes to profitability. Additionally, digital businesses can readily evolve in response to market demands.
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Fostering
Innovation Digital business stimulates innovation to address societal challenges. Entrepreneurs engage in healthy competition to introduce innovations that maintain customer interest in their products.
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Guidelines for Cultivating a Successful Digital Business
Following comprehension of digital business principles and advantages, practical advice for establishing a thriving digital enterprise is paramount. Here are guidelines to effectively build a digital business that garners remarkable profits:
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Embrace Digital Business
Thinking Business stakeholders must adopt a digital business mindset. Those accustomed to physical business operations need to acquaint themselves with the digital realm. Understanding the technology employed in their enterprise is crucial. Recognizing the continuous evolution of technology prompts entrepreneurs to perpetually innovate.
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Assemble a Competent Team
Building a digital business necessitates a cohesive team for seamless operations. Ensure team members share a common vision. Each member should execute tasks in alignment with the overarching mission and vision. A proficient team plays a pivotal role in propelling the business to success.
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Employ Appropriate Business Strategies
Firstly, comprehend the chosen business model for the digital venture. Identify target consumers, the product range, delivery mechanisms, and the rationale behind the model’s profitability. Subsequently, apply a strategy suited to the business model. Address market issues and ensure the offered product caters to the identified market gap. Additionally, formulate a strategy tailored to the digital domain.
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Harness Technological
Tools Leverage available technology to enhance business development. Implement search engine optimization to heighten online visibility. Cultivate the company’s digital brand via social media to capture attention.
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In summary, digital business employs digital technology elements in its operations. Existing digital business examples encompass design services, website creation, digital marketing, social media influencers, affiliate ventures, and more. Are you contemplating embarking on a digital business journey?
