Is Your Business Future Proof? Use Digital Revenue Streams to Prepare for the Unexpected

Share This Article

0 0 0 0

Learn the benefits of digital revenue streams and how they can future proof your business.

digital revenue

No one can predict when the next hit to your business will come, but you can set yourself up to better withstand volatility by creating reliable digital revenue streams.

Implementing digital revenue streams not only helps future proof your business so you can become more resilient overall, but you can also enjoy the positive effects on your bottom line in a thriving economy.

What is digital revenue?
Digital revenue can take many forms. It can range from simply selling a service or product online to adding complementary digital services, such as allowing people to digitally “try on” glasses or lipstick by uploading photos, or even creating a new platform business by connecting buyers and sellers (like Uber or Airbnb).

Below are some of the benefits, adapted from Gartner (full content available to clients).

brick and mortar versus digital revenue comparison chart

Why is digital revenue important for my small business?

In a recent Capterra survey, 73% of small business owners worry they’ll need to close within six months. This stat really highlights the need for business owners to adopt digital revenue streams sooner rather than later. Learn more about our methodology.

how long businesses expect to last under current conditions chart

Digital revenue costs less to generate

Once you have a good digital infrastructure in place, it’s usually much easier to scale. For instance, if you’re a therapist and you begin practicing via telehealth, it doesn’t cost you anything extra to add another patient to your practice. You already have your telehealth provider set up, and the technology is already being used with several other patients.

digital revenue dashboard on laptop stock image

How do you know what digital infrastructure you need?
Every tool or software platform is useless unless it’s solving a problem and meets a business need. We put together information to help you identify what software you may need to meet your goals. Check out our guide on 6 steps for finding the right software. Once you have software in place, it’s also essential to create systems to make that software most effective within your company.

Digital revenue requires less capital investment

With a digital model, you don’t need as much of a physical presence or physical storage space. For instance, if you want to set up an e-learning workshop, you don’t need to worry about paying for the space, refreshments, or supplies.

With a digital business, you also have the freedom to test out new products easily. If you have an idea for a new product or service, you can simply make a prototype and put it up for sale on the site. If you get a huge demand for the product, great—you can ramp up production. On the flip side, if you don’t get any bites, not a problem—you only made a single prototype so there wasn’t a lot of waste or loss involved.

How do I manage inventory for my digital business?
It’s critical you have a good sense of your inventory. Not only does this prevent revenue loss, but it helps improve the customer experience by reducing order cancellation. Check out our guide to the 5 best free and open source inventory management software.

Digital revenue streams allow for recurring flows through a subscription model

When you’re set up with a digital shopfront, you can easily set up recurring flows or subscription models.

For instance, if you’re a yoga studio, you can encourage unlimited monthly subscriptions which guarantee steady and predictable income for your studio. Or, if you’re a coffee roaster, you can encourage businesses or individuals to set up subscriptions via your eCommerce platform, which makes it easier for both you and your customer by automating part of the shopping experience.

ecommerce shoppers using digital wallets

How can tech help me set up a subscription model?
Subscription management software can help you set up pricing tiers, discounts and packages for customers to make it easy for them to receive your product or service. This type of software can also send payment reminders, set up autopay and generate invoices for your customers.

Digital revenue makes it easier to earn across multiple geographies

Once you have a good digital system, you can see additional possibilities open up that don’t limit you to a physical location. The beauty of an online degree program is that students can access a renowned curriculum in their area of interest regardless of their physical location.

Alternatively, if you own a fitness studio, you’re no longer restricted to only those customers who are in close proximity. If you have a unique offering, clientele from all over the world may be interested in tuning in to your online classes for the exclusive benefits you offer.

How can I expand my business across multiple geographies?
You can make use of video conferencing tools to extend your business beyond the four walls of your office or studio.

A strong digital presence sets you up for success

It may take some extra effort up-front to optimize your business for digital revenue, but it’s worth it in the end. Adding digital revenue capabilities ensures your business is more adaptable for unknown future events, and sets a sturdy platform for you to be able to scale your business with new products, services, and clientele.

You can learn more about how COVID-19 affected small digital businesses. The full research report is available here.


Survey Methodology

Results based on Capterra’s survey of 503 small-business leaders, defined as presidents/vice presidents, C-suite, or owners/founders at U.S. companies with 2-250 employees in March 2020. 370 out of the 503 respondents lead small businesses that conduct most or all of their business virtually.

Looking for eCommerce software? Check out Capterra's list of the best eCommerce software solutions.

Share This Article

About the Author

Amanda Kennedy

Amanda Kennedy

Follow on

Amanda Kennedy is a senior content writer covering project management and construction trends for Capterra. Amanda earned her bachelor's degree in English from the University of Texas at Austin and is currently earning her master's degree in information science from the University of North Texas. She has created content for leading brands for 9+ years and has guest lectured on communications and marketing at the University of Texas at Austin.

Comments

No comments yet. Be the first!

Comment on this article:


Comment Guidelines:
All comments are moderated before publication and must meet our guidelines. Comments must be substantive, professional, and avoid self promotion. Moderators use discretion when approving comments.

For example, comments may not:
• Contain personal information like phone numbers or email addresses
• Be self-promotional or link to other websites
• Contain hateful or disparaging language
• Use fake names or spam content

Your privacy is important to us. Check out our Privacy Policy.