Try out these activities and you may just find that you’ll lead better and your business will thrive.
There are 23 million small businesses in America, and 543,000 more are started every month. So if you’ve got a business idea and you want to stand out from the crowd and succeed, you better have a unique value proposition, diverse revenue streams and loads of creativity. To inspire you, we’ve rounded up 17 unique businesses that have proven their model works. From retail apps to fashion upstarts, these companies are rethinking revenue and creating compelling value for parties on both sides of the transaction.
Tell us what you think is the most unique business model in the comments.
Skillshare launched as an a la carte education marketplace — experts could teach a class on any subject, and anyone could attend, for $20 or $25. But this past March, Skillshare pivoted to a $10 per month, all-you-can-eat model. And unlike most education startups, Skillshare doesn’t use professors from top-notch universities; you need not be a Ph.D. to be able to teach something useful. And on the student side of things, it’s easy — and relatively inexpensive — to become a lifelong learner.
Lesson: Leverage the intelligence and expertise of normals to create a massive intellectual marketplace.
IMAGE: STITCH FIX
Founder: Katrina Lake
Innovative angle: Personal styling made smarter by data and trendy part-time fashionistas
Founder and CEO Katrina Lake says Stitch Fix’s “combination of the art and science hasn’t been seen before in retail industry.” Her startup’s proprietary algorithm is constantly processing the responses to new user style surveys — and feedback on the items they receive — to help Stitch Fix’s 300+ part-time stylists in California and Texas assemble “fixes” (boxes of five items) that users are almost guaranteed to love. “There are no other services that provide a truly personalized retail experience at the affordable price point that we offer at Stitch Fix,” says Lake.
Stitch Fix originally targeted the mid-20s urban professional who has a demanding job and doesn’t have much time to shop, but appreciates being on-trend and looking nice. As the company grew, it became clear to Lake that “the profile of a time-starved woman is universal,” and it applied to stay-at-homes and C-suite executives alike. “We’re able to take one thing off their plate by delivering a fun and delightful retail experience that’s truly personalized for them,” says Lake.
Lesson: A product that uses smart data to surprise and delight — and save consumers time — is a win.
Founders: David Gilboa, Neil Blumenthal, Andrew Hunt, Jeffrey Raider
Innovative angle: Cutting out the middleman — especially a behemoth one — and transforming a medical device into a fashion accessory
The influence of Warby Parker is undeniable, and tech reporters everywhere are reminded of that daily when they’re pitched “The Warby Parker for [insert stale industry here].” Warby Parker’s undercutting of the Luxottica empire’s price points and special collections have turned glasses-shopping into something more like shoe shopping: They’re only $95, so sure, I’ll take a pair in blue, too. What started as an ecommerce venture now has brick-and-mortars that outpace Tiffany and Co. (and have bouncers and lines on weekends) and has spawned pop-ups at America’s coolest locations, from The Standard to Alchemy Works. Warby Parker eliminated the middleman and added not only an immense cool factor, but also a social good element, and nothing piques the modern consumer’s interest more than lower prices, trendiness and the feeling that you did something good.
Lesson: Change the way people see an industry.
An Oscar de la Renta-inspired Paperless Post invite.
IMAGE: PAPERLESS POST
Paperless Post started in 2008 as the U.S. Postal Service’s biggest enemy — it encouraged people to email invitations and announcements, made pretty with hundreds of design templates. The site was free to use, though premium templates and envelope liners required prepaid “Coins.” In late 2012, to open another revenue stream, Paperless Post embraced paper after all, letting customers design a card at PaperlessPost.com and then send it electronically, via snail mail, or both. Alexa Hirschfeld told Mashable that 60% of Paperless Post users wanted paper stationery. “They’ve told us that they love Paperless Post, but there are certain times that they really need to use paper for its archival quality, for its ability to be saved and scrapbooked.” Meanwhile, digital innovation didn’t stall. Paperless Post has upped its aesthetic ante via revenue-share partnerships with J. Crew, Oscar de la Renta and Kate Spade, who lend designs to the site’s templates.
Lesson: Aesthetics matter.
Zady champions conscious consumerism and aims to change the way we think about the fashion industry, particularly fast fashion. Founders Soraya Darabi and Maxine Bedat focus on high-quality, hand-crafted goods that are ethically produced (think: vegan leggings), locally sourced, environmentally conscious and made in America. In their eyes, less is more.
Lesson: Storytelling — and the goods’ path to consumers — matters, and people will pay a premium for it.
We’re living in an on-demand era. We want things and we want them now. Handybook has emerged as a more user-friendly instant-gratification-enabled Angie’s List. It operates in 26 citiesand recently raised $30 million to grow the team, specifically the mobile engineering department. Hanrahan told Mashable, “The way we set up Handybook is to think about all the services you need inside your home and how we can be a remote control for managing those services.” Looks like people are clicking that remote — Handybook has more than 10,000 bookings a week, of which the company reportedly keeps 20%.
Lesson: Convenience is key.
Popsugar’s content covers everything its target demo is interested in — entertainment, celebrity, fashion, beauty, fitness, food and parenting — in a variety of formats, including online, in-app and on TV. In 2007, the company acquired shopping search engine ShopStyle, and piggybacking off the Birchbox trend launched Popsugar Must Have, a subscription box curated by Popsugar editors. It’s become a global lifestyle brand with 41 million unique visitors and 234 million pageviews monthly.
Lesson: Content drives commerce, and people love a one-stop shop.
Naturebox is taking on the $64 billion snack food category that to date has been chock-full ofmanipulative food science and unhealthy additives. To date, NatureBox has developed 120 snack varieties and shipped 1 million boxes. Half the subscribers are in the Midwest, where access to organic markets and Whole Foods is limited. “We solve that problem by sending better options straight to their doors,” says NatureBox’s Amanda Natividad. “We empower our happy snackers with choice,” and an algorithm that considers dietary preferences and snack popularity determines what arrives in members’ boxes. The company saw 20x growth in 2013, and traffic to the site’s blog has grown steadily, indicating an increasing interest in learning about healthy eating.
Lesson: Making your own product gives the business an edge unparalleled by competitors who curate.
IMAGE: DATA VISUALIZATION POWERED BY VISAGE
Hukkster’s giving consumers the advantage when it comes to shopping. The startup’s Hukk It Chrome extension creates a one-click experience for tracking coupon codes — in real time — for the items you want, whether it’s apparel, accessories or housewares (70% of discounts in the marketplace are coupon code-based). Hukkster tracks coupon codes and sales at the SKU level and then sends real-time alerts to shoppers. The open rate for these emails is 70%, says Bell, adding that it’s a win-win for everyone — Hukkster “works directly with the brands to help drive traffic and sales in-season at healthy margins and shoppers can gain access to the products when they’re interested in them.” For now, Hukkster is paid an affiliate fee when shoppers purchase through the platform (partners pay increased commissions for better and customized sale alert emails), though Hukkster is “excited to work with [brands] directly down the road,” when it has a canon of data surrounding purchase intent. Helping the company gather data is a new app with a Tinder-like interface, wherein shoppers swipe left to “hukk” something and right to pass.
Lesson: Shoppers like saving money; helping them do it means everyone wins.
A cohort of Gilt veterans (founder Kevin Ryan also founded Gilt Groupe, among other New York startups) decided the wedding registry had become stale and unimaginative. As Pinterest was helping spouses-to-be develop creative wedding ideas, the registry process remained boringly point-and-scan. The founders came up with Zola as a new alternative, designed for millennial fiancees that enabled couples to create a registry that offers freedom and personalization. Zola was projected to have 3,000 couples use the service in year one, but the team already has 16,000 engaged couples just seven months in (Ma credits word-of-mouth, since friend groups tend to marry in waves). Ma says the top-selling items are the Lodge Cast Iron Skillet, waffle makers and lasagna dishes, which are “most likely tied to the popular brunch and easy-to-prepare meal trends,” says Ma. But she’s also seen immense interest in registering for experiences, like meal-delivery services, cooking classes and honeymoon activities. This gifting trend “supports our bigger belief that couples today want to register not just for tangible products, but also for experiences that allow them to spend time together and keep date night alive,” says Ma.
Lesson: A beautiful interface and the ability to customize go a long way, as does reinventing the traditional way of doing things.
The app for Oyster, one of two e-book subscription services that has partnered with Simon & Schuster.
Subscription ebooks have become a trend, but in the past year, Oyster has emerged as a runaway success. In 2012, the social reading startup raised $3 million in 2012 from Founders Fund, and since then — in addition to raising another $14 million — the service has amassed 500,000 titles, including new releases, New York Times bestsellers and National Book Award winners from more than 1,600 publishers. The monthly subscription is $9.95, which is far less than the price of a single book, hardcover or paperback.
Lesson: Embrace the direction of media consumption habits, make the price undeniable.
Despite legal woes and backlash toward surge pricing, Uber has become a fixture in some of the world’s biggest cities. To date, the company has raised $1.5 billion and has hinted at expansion to other logistics markets, like same-day delivery and errands, a space it’s experimented in with activations like Goodwill pickups and ice cream delivery. With so many cars on the road to do these tasks, should Bezos watch his back?
Lesson: Innovation is an uphill battle, but it’s one worth fighting.
Each of the pocket patterns on a Serengetee tee originates from a place the founders have visited and is tied to a social cause in the region. Customers personalize shirts (base color + pocket pattern) and thereby support a cause, thus becoming tied to and invested in global issues.
"Our message is not that we can save the world but we can definitely change it through a sustainable business model," says cofounder Ryan Westberg. Serengetee gets the word out to college kids through a campus rep program, which reached 2,500 this summer.
Lesson: Millennials like customization and social enterprises — and they’ll evangelize for you.
IMAGE: DATA VISUALIZATION POWERED BY VISAGE
The Los Angeles-based retail company began not as a fashion label, but as a self-publishing platform where style-minded users could create their own “tear sheets.” Those tear sheets were then used by founder Allison Beal as inspiration for the inaugural StyleSaint collection, an apparel canon she could be sure would resonate with her community in a model she calls “creator-to-closet.” Today, StyleSaint makes new collections every six to eight weeks based on those tear sheets, and uses $10.1 million of venture capital to fuel growth. The direct-to-consumer approach, founder Beal says, helps to reduce excess inventory and eschews fast fashion in favor of quality goods.
Lesson: The customer is right, especially when it comes to her own taste.
Like Uber, Airbnb is not without its legal troubles, but the “space marketplace” is a $10 billion business that has become the poster child for the sharing economy (see also: Rent the Runway,Lyft, Neighborgoods, etc.) and the behavior known as “collaborative consumption.” The site hosts 300,000 listings and has helped more than 4 million travelers book stays. Not content with just the space booking element, the site is also experimenting with group dining experiences.
Lesson: Sharing is caring — peer-to-peer models save consumers money, help owners make money and create a more authentic, local experience for travel.
IMAGE: RENT THE RUNWAY
Founders: Jennifer Hyman and Jenny Fleiss
Innovative angle: Rent inventory of high-end dresses at a fraction of the price to create a “Cinderella moment” and introduce women to brands they wouldn’t otherwise wear
The rise of Instagram and Facebook photos means the pressure is on to look and feel great at events … and to not repeat an outfit. Rent the Runway was founded after a closet-full-of-clothes-and-nothing-to-wear moment so women could have access to the red carpet looks they see on celebrities, without breaking the bank (rentals are typically 10-15% of the dress’ ticket price). But unlike other discounted apparel sites, Rent the Runway doesn’t offer last season’s goods — it buys in-season merchandise like Bloomingdales or Neiman Marcus do, and rents the items out to different consumers every week, so it recoups the cost of the items and functions as a gateway for women to get into luxury brands. The company started online, but has experimented with pop-ups to overome consumer hesitations and ensure a perfect fit (therein lies the biggest risk of Rent the Runway, though its consumer feedback data attempts to give women the skinny on how items fit). The rent-not-buy model has been mimicked in other categories by brands likeThe Black Tux, Chic by Choice and Eleven James and has plenty of potential for expansion.
Lesson: Aspirational fashion and try-before-you-buy are potent sales drivers.
How could we not include the mother of all subscription services, Birchbox? The beauty startup spawned an entire industry and influenced several of the businesses on this list. Birchbox introduced us to expert curation, the joys of surprise and delight and the idea of discovery ecommerce. And its growth has attested to the fact that it’s working — $71.9 million in funding, the bulk of which came this past April after a successful holiday season. “We still feel like we are in the earliest innings, but this is a moment, this is an inflection point to invest in and really push hard when we are seeing traction, momentum and excitement,” Katia Beauchamp toldMashable.
Lesson: A little curation goes a long way in a crowded industry.
If you’re new to the world of ecommerce or online marketing in general, you’ve likely heard about search engine optimization (SEO). In a world where the majority of online traffic stems from a string of text typed into a search box, search engine optimization can be a deciding factor in the fate of your business.
SEO encompasses many tactics but the underlying principal is that you’re helping Google and other search engines better understand what your ecommerce site is about and what it sells. This in return increases your visibility by increasing the chance search engines will list your site in the search results when potential customers are looking for the products you sell.
One of the foundational tactics of SEO is keyword research. Keyword research is the simple art of better understanding the terminology your potential customers are using to find the products you’re selling, then matching your website and marketing terminology.
In this article we’ll cover the basics of keyword research for ecommerce. The ultimate goal is to build a relevant list of keywords that you can refer back to and use as you build and optimize your site, write your product descriptions and craft your blog posts.
Over time, you’ll help search engines better understand what your site is about so they can better match your store as a result for relevant search terms, leading in increased traffic and sales.
Every time someone does a search, the search engine must decide which handful of results to display from hundreds of thousands of possible pages. It’s up to the search engine algorithms to determine the best and most relevant matches for every single search. This is why it’s so important to choose your keywords carefully, so that the search engines can match and display your site in the search results to the most relevant keywords searches.
Not only is it important to rank on the first page of a search engine results page for relevant search terms, but it’s equally important to rank in the top positions of the first page. To understand how big of difference position can make consider the graph below which shows search result position and average traffic share:
Image Source: Chitika
From the graph we learn that the first page of search results receives over 90% of the traffic share and the first three search results receive over 60% of the traffic. Most significantly, the difference between position ten (first page) and position 11 (second page) means a decrease in traffic from that particular search term by over 100%.
In short, the closer you are to the top of Google for relevant search terms the more traffic (and potential sales) you’ll receive. Depending on the search term and the volume of searches per month being made for that search term, the difference in just a few positions can represent significant revenue loss in the long term.
Before you jump into doing keyword research for your online store, there are a few basic terms you’ll come across that are important to know and understand.
These terms include:
Keywords - A keyword(s), in the context of search engine optimization, is a particular word or phrase describing the content of a web page or site. Keywords act as shortcuts to sum up the content of a page or site. Keywords are part of a web page’s metadata that helps search engines match a page to an appropriate search query.
Longtail Keywords - Longtail keywords are simply keywords that contain three or more words. Longtail keywords are important (hence them having their own name) because they make up over 70% of online searches according to SEOMoz and also tend to convert better as they catch people further along in the buying cycle. Someone searching for “hair extensions” is likely in the early information gathering stage, however, someone searching for “20 inch brown hair extensions price” is likely further along the buying cycle and much closer to purchasing.
Search Volume (Avg. Monthly Searches) - Search volume is usually measured in average monthly searches. This is the total number of searches each month for each particular search phrase (keyword). Ideally you’re looking for the keywords with the highest search volume. Ranking highly for search terms with higher search volumes means more potential traffic and conversion potential for you and your store.
Unfortunately, there is not a magic number that represents the perfect search volume for everyone. What constitutes the “right” search volume is going to be different for every site.
Competition - Search volume isn’t the only thing you need to consider. Competition is equally, if not more important. There’s no point in trying to rank for keywords you have no chance of ranking for. Competition refers to the difficulty of ranking for each particular keyword. In an ideal situation, your chosen keywords would have high search volume and low competition, however, these gold nuggets are difficult to find and will require some hard work, patience and maybe a little luck to find.
Keep in mind that the competition in Google’s Keyword Planner Tool refers to paid advertising competitiveness of keywords rather than organic search competition, however, this is many times representative of the organic search competition as well.
Now that you understand why keyword research is important and some of the basic terminology, it’s time to do your own keyword research. To begin, you’ll need to brainstorm an initial list of search terms you believe your customers would search for to find your shop and the products you sell. Just grab a pen and paper and begin making a list of search terms you would use. At a minimum your brainstormed list of each keyword should be two words but you’ll want to think of longtail keywords as well, up to four to five words or even more.
The more words you brainstorm upfront, the more you’ll have to work with to uncover new search terms so don’t give up too easily. Try to build a list with as many relevant keywords as possible.
You may want to ask friends and family for their input as well but avoid asking them directly what they would search for and try to get them in front of a computer and ask them to search for your brand/products. Monitor what they search for and the links they click. This can provide some great, real-world insight into what an average person would search for.
After you’ve done some initial brainstorming, you can consider a few tools to help expand your list. One of the simplest tools is Google’s own suggestion feature. To see some of Google’s suggestions, simply do a Google search and scroll to the bottom of the page and look at the related suggestions.
A great tool for help with your brainstorming is Übersuggest. Übersuggest scrapes Google for Google suggestion keywords by taking your keyword and adding every letter of the alphabet from A to Z capturing the most frequently searched permutations.
Don’t forget to consider keyword modifiers like “how to” or “where can I” etc. For example, someone may not be looking necessarily for ”hair extensions” rather they may be looking for “how to get fuller, longer hair”.
Now that you have your initial list of brainstormed keywords, you can use these keywords to find more keywords using tools online. There are many tools you can use to conduct your keyword research, paid and free, however, one of the most popular tools for conducting keyword research is Google’s Keyword Planner Tool. The Google Keyword Planner Tool allows you to search for keywords to determine how many searches per month are being made for that term, how much competition there is competing for it and the related search terms.
The related search terms are important because it’s going to expose you to other keywords that are similar but may have a greater number of searches, less competition or a combination of both.
To use the Google Keyword Planner Tool, you’ll need a Google Adwords account which is free and only take a few minutes to get set up.
Once you have a Google Adwords account you’ll need to login to your account and select Tools from the menu at the top, and then select Keyword Planner.
On the next screen, click Search for new keyword and ad group ideas.
Next, enter the keywords you’ve brainstormed from the previous section, either one at a time or a few at a time by separating each with a comma. We would recommend starting with one at a time to keep things simple.
Double check your settings under Targeting to make sure you’re viewing search information that is relevant to you. For example, if you’re based and ship to USA and Canada, you should be looking at information results for the USA and Canada.
Under Customize your search and Keyword options, you should turn on Only show ideas closely related to my search terms. This will provide much more relevant keywords, however, if you feel the keywords are too closely related or you wish you expand your search, feel free to try a search with this option turned off.
On the next screen, it will default to the Ad Group Ideas tab. Change that to the tab labelled Keyword Ideas.
The first column will list the original keyword(s) you searched for as well as closely related keywords. The second column shows you the number of searches being performed each month in the geographic area you specified. The third column is the level of competition for each keyword.
It is this information you’ll now need to begin sifting through to begin building your keyword list. You can use the Keyword filters on the lefthand side of the screen to only show low and medium competition keywords and filter out the ones that would likely be too difficult to compete for.
This will leave you with a list of keywords related to your original search that have a low and medium level of competition. As an example, we have colour coded one such query below, the yellow highlighted keywords being medium competition and the green highlighted keywords being low.
With this list you’ll want to take the best terms that describe your site, pages and product offering, keeping in mind the search volume and competition, and record them, ideally in a spreadsheet. You’ll want to repeat this process for all the brainstormed keywords you came up with.
Now that you’ve come up with a list of relevant keywords it’s time you double check your work. You may have got a little carried away and added in some keywords that were low competition, or high search volume but don’t accurately describe your store and offering. In this phase you’re going to look at each of your keywords and:
Ask yourself - Is the keyword relevant? If someone searches for that term and lands on an appropriate page on your site, will they find exactly what they are looking for?
Search for the keywords in Google and Bing - You’ve already looked at the competition strength in Google Keyword Planner but as mentioned prior, those levels represent paid search competition, which doesn’t always translate over to organic search. Understanding which websites already rank for your keyword gives you valuable insight into the competition, and also how hard it will be to rank for the given term. If the top results are for major and well established brands, it’s going to be more difficult to rank highly for your keyword.
Will all the keyword information you have gathered, you’ll now want to really boil your list down. To start, you’ll really want to focus on a handful of keywords (5-7) but it’s a good idea to keep a bit of a broader list (15-20) to keep your options open and work on long term.
The good news is that after completing your keyword research and slowly implementing your chosen keywords throughout your site, Google should have a better understanding of what your online store is all about so it can better match you to the correct searches.
Keep in mind though that SEO and keyword research is an ongoing process. It takes time and patience to research and implement your keywords and more time for Google to pick up on these changes. Most importantly, over time, SEO changes, search engine algorithms change and the terms your customers use will change so make sure you routinely go over your keyword research to make sure it up-to-date and accurate.