If you’re an online entrepreneur and spent any time exploring courses and coaches to help up your small business game then you’ve likely heard the term “scale your business” before. “Scale your business to 6 figures” or “scale your business to $500K for 2021” for example.
What Does Scaling Your Online Business Mean?
So… what does scaling a business actually mean? How does it differ from growing your online business?
I’ve seen a lot of confusion lately about scaling a business and I wanted to take some time to dive into what it means to scale. Now first of all scaling does not mean starting from scratch. There must be something to scale so in order to scale your online business it must have be in operation and bringing in revenue.
When you’re first starting out you’re concerned with getting things off the ground, building your online presence, and starting to bring in an income. So let’s assume you have an online business and jump forward a bit.
The world scale seems to be thrown around as much these days as the term “next level”. I mean what does that mean anyways? Next level of what exactly? The whole next level thing is a topic for another day. So why is the world scale thrown around so much in the online entrepreneurial world?
Well it’s talked about so often, myself included, because scaling is VITAL to achieving the level of success and freedom most people are desiring when starting their online business.
Growing your business means you are expanding. You are bringing in more clients and customers and therefore spending more and more time meeting the needs of those clients. You may have started off your business with one or two clients here and there and now you are delighted to have a fully booked calendar, or at least as full a calendar as you desire to have. You have grown exponentially. You’ve even likely had to bring on team members to support you.
So growth is an amazing thing. You of course want to grow your business. As you grow your business, and your revenue, the demands on your time and your energy have grown with it. The demands for your need of support from team members and tools have perhaps grown with it as well. Depending on the type of business the cost of growth is growing at the same level as the growth in revenue. You’re trading time for dollars and hitting a wall.
This is why it’s so important to be focused on scaling your business as you’re growing your business.
When you scale your business you are taking on new revenue more and more, at a faster and faster rate than the cost of your time and resources to support it. When it comes to business the definition of “scale” is to increase revenue at a faster rate than costs. And when I think of online entrepreneurs I think an important cost to consider is that of your time.
How to Scale Your Online Business as an Entrepreneur
So how do you scale your online business then?
Raising Your Prices
Well one way of course is to continue raising your prices. But there has to be a method and strategy to this of course. You can’t just randomly continue raising prices and expect the clients to come. If you’re still in the position of always finding yourself on the lookout for the next client you can’t really just up and raise prices. The demand needs to be there. You must get out of seeking mode and establish a business and marketing strategy that is steadily growing that demand. The key to raising prices is that demand outweighs supply.
Part of that business strategy is having a suite of products and services that is bringing people into your business at varying points in their customer journey and escalating them along your value ladder. That ascension up your value ladder facilitates scaling. This leads us to moving away from a strictly one to one service model.
Moving from One-to-One to a One-to-Many Business Model
One of the first moves to make when trying to scale your business is to move from a one to one structure to a one to many structure. For a coach this might look like branching out from 1:1 coaching to also start offering group coaching programs or online courses. For a service provided it might look like expanding from exclusively done for you client services to also offering some group done-with-you programs or completely passive DIY courses.
But this isn’t as easy as many make it out to be. In order to fill a group program or sell online courses you must have the audience to promote such offers to. This would involve your social media following, email list, and even paid advertising.
The struggle often is that the business owner’s focus has always been on finding the next client and not on building an online presence and authority in the industry and marketing themselves on a larger scale.
Being focused on scaling requires having a focus on marketing your business as well. I hate to break it to you, but if you’re an online entrepreneur… you’re also a marketer. You need to be marketing your business.
Can you grow your business successfully with strictly organic marketing? Yes
Can you grow your business successfully with strictly paid marketing? Yes
But I believe to truly scale your business successfully it’s important to have a balance of both organic and paid marketing.
Diversify Your Income
It’s so incredibly important to diversify your income. I believe everyone should have a mix of passive income with DIY type products available as well as done with your products and services and even done for you services depending on your industry. Having passive income allows you to feel supported in being selective with the clients you work with and truly serving the clients you do take on at a higher level and creating an experience that surprises and delights them while creating incredible results. This means you must raise your prices because the demand for your services exceeds the supply instead of just in a desperate effort to create more revenue. This is all part of establishing a business model and offer strategy that supports scaling.
There needs to be a method behind the products and services that you’re launching.
If you’re still in the place of throwing spaghetti at the wall to see what sticks when it comes to putting out launches and offers in your business then you aren’t scaling. The offers and products you put out have to make sense for where you are in your business and where you are wanting to scale your business to.
For instance a popular move people make when first considering scaling is launching a membership of some sort. But this is a jump many businesses are making far too early and often for the wrong reasons. They want recurring revenue so they add a membership offer. But membership offers should only be launched if they make sense for the content being delivered and the needs of the customer. Not just because the entrepreneur is looking for “easy” recurring income.
Most people don’t realize… a recurring payment offer is the most difficult to sell. Yes, even at a lower price point, continuity offers are difficult to convert. Many people assume that they can just throw together a membership with a relatively low price tag, let’s say under $100 a month or even under $50 month, and that because of the low cost of entry their membership will fill up with little effort. But that’s not actually the case. Not to mention the endless need for new content and for bringing in new members because there will always be turnover. I’ll have to dive into this more deeply in a future post.
Scaling Your Business Successfully Requires Strategy and Planning
There are obviously a lot of pieces involved in scaling your online business. There is a lot of strategy and planning involved but trust me… it gets to be fun and you can do it in a way that feels aligned for you.
Are you wondering how prepared you are to scale your business? Download the Set to Scale Checklist and find out where you stand!