How to make your digital services more profitable and sustainable? This is a question that thousands of entrepreneurs are looking for an answer to daily.
Entrepreneurship starts with a dream, which then needs to be planned, followed by the opening of a company. The business needs to have durability and profitability.
After all, ensuring a company’s profitability is essential for its growth, for its survival in the market.
In this article, you will find out you can make a profitable business with digital services and get alongside your loyal clients.
How to make your digital business more profitable and sustainable?
Calculate the business profit margin
Now that you have a deep understanding of the concept of profit, it’s time to learn about another essential concept to make your digital business more profitable and sustainable: the profit margin or profitability index.
Perhaps, you answer that your profit margin is 50% or even 100% on your services or products sold, however, is it really, that this is your company’s profitability?
The concept of profit margin in the business world is based on the difference between the acquisition/production and resale costs of your products.
To accurately know the profitability of a company, business management uses a simple but very precise mathematical formula known as the profitability index:
Profitability Index = (Profit / Revenue) x 100
Strategies to make your company more profitable and sustainable
After knowing the concepts of profit and figuring out how to find business profitability, it’s time to think of strategies that answer the initial question in this content.
Some strategies can contribute to the profitability and sustainability of your digital business:
1. Prepare a detailed plan for your company
Most companies that end their activities early do not have a business plan.
The business plan is essential for the success of a company, after all, through it, we know important aspects of the business, such as the most adequate and economic tax regime for the company’s profile and activities.
2. Know the costs of your digital business
Throughout this content, you learned how to calculate the profit margin of your digital business.
However, to make a profit, you’ve discovered the importance of knowing your company’s costs up close.
3. Properly price your products
Establishing an appropriate pricing method for your products can significantly contribute to the success of your digital business.
There needs to be a balance. Your company cannot sell products and services far above the market to avoid losing to the competition, but neither can it price products at a bargain price and compromise profitability.
4. Diversify the mix of products and services
Another strategy that can make your digital business more profitable and sustainable. It is the diversification of the mix of products and services.
The greater the mix of products and services offered by your digital business, the greater the chances of conquering customers, making money, and increasing profitability.
8 ways of profitable digital services
Digital businesses are more easily adaptable, scalable, and can deliver ROI quickly. To help you assertively develop your project, see some best practices on how to create a profitable digital business:
1. Think about the product or service
Online channels add versatility in the type of product or service that can be sold. To define your scope, assess your interests and skills, and think about what would be the best deal for you and one that aligns with market demands.
Common services are advisory, consulting, product import, creation/writing, courses, e-commerce, affiliation, and many others. It is worth doing in-depth research, crossing your interests with latent market opportunities, and validating your idea with the public of interest.
2. Elaborate a business plan
Before practice, it is necessary to analyze and plan. Planning is the key to understanding how to create a profitable digital business.
So set your goals and objectives. Study the market, competitors, prices, opportunities, and costs involved. Also, marketing intelligence tactics, difficulties, and, of course, create a schedule with everything you need to get your plans off the paper.
To have this overview organized, it is worth creating a canvas or another document that contains your business plan and all this information gathered.
3. Study your audience
Knowing your persona, your hobbies, pains, and desires are extremely important. Communicate assertively and be able to offer your product and service where, when and in the way, that conversion becomes more viable.
4. Define your pricing
Even though the investment of a digital business may be low, thinking about expenses and profits is extremely important. Add to your business plan or create a spreadsheet containing financial information such as investment value, expected earnings, possible downturns, seasonal periods, tax costs, etc.
Remember to make it very clear how your business will support itself. Will people pay for a product, service, or content? What will be the price charged? Is the stipulated price sufficient to cover the costs?
5. Create a solid brand identity
Brand identity is the name used to define the set of attributes, values, objectives, positioning, and other physical and visual elements of a brand. Don’t fall into the trap of imagining that this can be on stand-by. Creating and managing the brand is central to digital business success.
In this way, even being an intangible asset, the brand allows your enterprise to have very tangible and positive results.
To start, define your logo, slogan, and other elements. Create a visual identity manual (MIV) for your brand to standardize these applications. This will make it easier to fix it in your persona’s mind.
Thinking about other issues such as brand positioning, personality, and tone of voice are also important at this time.
6. Develop your in-person digital platform
To sell your product or service, count on a personalized digital platform. With it, you’ll be able to cross data, information, automate processes, perform integrations and scale your operation.
7. Track your business growth
The steps you’ve seen are just the beginning of your journey on how to create a profitable digital business. After that, it is necessary to continuously evolve and follow trends. So that businesses can grow, consolidate and generate more profits.
Some platforms provide accurate reporting and other information about results that help with tracking and generating insights for improvements and new opportunities.
8. Add value to your services
You must show that the service offered by the agency is an investment for the client, not an expense. Otherwise, the customer will feel like they’re throwing money out the window – and being seen as a driver for this is a huge risk for you.
If your agency manages to escape the cost center view and become a strategic partner of the client, there is a good prospect of establishing a faithful relationship between the parties. Services that deliver results are valued. And this value enters into the business proposition with the customer.
And, after hiring, always do your part of the agreement with excellence. Gain trust through a service that is well-executed, transparent, and, above all, generates results for your client.
GitScrum supports your team to better results and effective deliveries!
Set your workflow and board to guide your Agile team, assign Tasks, Subtasks and keep in charge of the whole process evolvements. Allow your Agile team to collaborate.