How to Start an Online Business, According to ChatGPT

Online business ideas from ChatGPT

Of course, ChatGPT wisely tempered our expectations, pointing out that “becoming a millionaire solely through an online business is not a guaranteed outcome.”

OK, fair enough. Nevertheless, the AI chatbot still provided us with some online business ideas that it noted “have the potential to be lucrative.” Among the business ideas ChatGPT suggested were e-commerce, online courses, social media, affiliate marketing and dropshipping.

The AI chatbot briefly summarized each option:

• E-commerce store: Start an online store using a platform such as Shopify, WooCommerce or BigCommerce. Begin with a small niche using products you create or source from a supplier.
• Online courses: Online learning is growing in popularity, and you can make money by creating a course on a topic you’re knowledgeable about.
• Social media marketing: Many businesses want to improve their social media presence. You could start an agency to create and manage social media accounts, run ad campaigns, and provide data analytics and reporting for clients.
• Affiliate marketing: You can leverage affiliate marketing by creating content to promote products or services. If someone clicks on an embedded link, you could earn a commission or generate more sales for your own products.
• Dropshipping: This idea is similar to an e-commerce store, except you outsource product fulfillment to a third-party supplier. With dropshipping, you don’t hold any inventory, which makes it one of the best businesses to start with no money.

Ideas for a dropshipping business

In this exercise, we decided to proceed with the dropshipping suggestion. The advantage of dropshipping is that it can be started immediately. You don’t need startup capital for inventory, and you don’t need to spend time creating content or finding clients.

But where to begin? What products should our dropshipping business sell? To answer that question, we once again sought advice from ChatGPT.

Can you give me an idea for a dropshipping business?

ChatGPT observed that we would need to stand out from the competition, so we should consider “focusing on a particular niche.” With this in mind, it suggested “home decor” and presented the idea of bohemian-style home decor specifically. We decided to go with that aesthetic.

Choosing a brand name

What’s in a name? A lot, as it turns out.

Creating an effective brand name is a tremendous challenge when you’re just starting out. Many entrepreneurs agonize for countless hours over what to call their business. Even more frustrating is choosing a domain name. Most website names are already being used by other brands or are owned by internet squatters.

Fortunately, ChatGPT came to our rescue with a list of suggestions for a bohemian decor website. Among the numerous possibilities were Bohemian Haven, Free Spirit Decor, Nomad Nest and Earthy Elegance. All we would need to do at this point is check availability through a domain registrar such as GoDaddy or Namecheap. We would also need to choose a web hosting company for our website.

Where to find suppliers for dropshipping?

Being totally new to the dropshipping business, we had no idea where to source products. Once again, we posed our question to the AI oracle.

What are some examples of suppliers for home decor dropshipping?

ChatGPT immediately selected five potential suppliers: AliExpress, Spocket, Modalyst, DSers and Wayfair. We thought Spocket was a particularly good fit because, as ChatGPT explained, it focuses on high-quality suppliers from the U.S. and Europe. According to the chatbot, you can also filter by supplier location, price and more.

Marketing plan for a dropshipping business

By this point, ChatGPT had provided us with our dropshipping business niche, name and a list of suppliers. The only significant item left was a marketing plan to promote our new business. Using business.com’s marketing plan outline, we asked ChatGPT to fill in the blanks and help us develop a strategy.

Mission statement

In response to our directive to write a mission statement for our bohemian decor business, the AI tool generated an impressively realistic set of goals quickly:

“At [Business Name], our mission is to inspire and empower our customers to create a home that reflects their unique and eclectic style. Through our carefully curated selection of bohemian-inspired home decor items, we aim to create a community of individuals who share our passion for creativity, self-expression and living life to the fullest.”

Not too shabby.

Target market

ChatGPT helped us build customer personas. It identified five segments likely to be interested in bohemian home decor: young adults, urban dwellers, creatives, travelers and eco-conscious consumers.

ChatGPT pointed out, among other reasons, that bohemian decor offers young people a “sense of individuality and freedom.” It also noted that the style appeals to travelers because it “incorporates elements from around the world.”

Value proposition

In response to our query about identifying a specific value proposition, ChatGPT provided several suggestions. “Unique and creative” products that aren’t available elsewhere topped the list, along with affordable prices, sustainability, personalized customer service and cultural significance.

Pricing strategy

We asked the AI assistant to help us devise a pricing strategy using bohemian-themed throw pillows as an example. The chatbot advised us to consider the cost of materials, overhead costs, competitor pricing and the perceived value of a pillow on the market. ChatGPT estimated a pricing range of $20 to $100 for a single pillow, depending on the aforementioned factors.

Actionable advertising steps

Having established a solid brand identity and marketing plan, all that was left were actionable steps to drive customers to our online bohemian decor store. ChatGPT advised focusing on social media marketing; content marketing; influencer marketing; local events and markets; email marketing campaigns; and collaborations with other businesses as ways to reach customers.

How to use ChatGPT to create a business plan and start your business

With an idea set, we turned to ChatGPT to help us create a solid business plan. Business plans require specific sections and layouts to help make them readable, transparent and appealing to potential investors. For this reason, our ChatGPT prompts needed to be more nuanced to challenge the AI tool and help us create a more fine-tuned, customized business plan. Here are the steps we took.

1. Craft a nuanced prompt.

First, we structured our ChatGPT prompt to ensure it played an appropriate “role.” By role-playing and following specific steps, we helped ChatGPT focus on its task. Note that by using “#” around certain words, we created sections for ChatGPT. This technique helps the tool better parse requests.

We created the following prompt to help ChatGPT focus on its goal while still asking us for feedback about how to proceed with its task:

Source: OpenAI.

In response, ChatGPT suggested we craft each of these sections to create a business plan:

• Executive summary
• Market analysis
• Business model and operations
• Marketing and sales strategy
• Financial plan
• Implementation timeline

We then proceeded to work step-by-step through each of these sections with ChatGPT.

2. Create the executive summary.

ChatGPT helped provide an overview of the executive summary, which lays out the plan’s contents and sets the tone. It broke this section into several smaller subsections to provide a clear overview of our dropshipping business while maintaining easy content scanability.

ChatGPT broke this section into the following subsections and created a draft for each.

• Business name
• Mission statement
• Vision statement
• Business concept
• Goals and objectives
• Target market
• Unique selling proposition
• Business model

3. Draft a market analysis.

Like the executive summary, ChatGPT provided an overview draft of the market analysis section, complete with smaller, prefilled subsections. This section should showcase a venture’s target audience, examine its competitors and predict industry trends to effectively position the business.

However, unlike the executive summary, some areas of the market analysis section weren’t completed because ChatGPT lacked contemporaneous data. Still, the tool provided a strong starting point for us to fill in our own data as we refined the analysis.

Subsections of the market analysis included the following:

• Industry overview
• Target audience
• Competitor analysis
• Market trends
• Market gaps and opportunities

4. Complete the business model and operations section.

The business model portion of a business plan should define how a business functions and delivers value.

ChatGPT completed an impressive amount of work in this section, proposing draft ideas and subsections. While its initial feedback was strong, it’s important to have a back-and-forth with ChatGPT to narrow results and ensure the tool is on the same page as your goals.

For example, in this draft, ChatGPT recommended using Shopify for our e-commerce platform, which matched our current dropshipping idea. It’s crucial to always watch for these kinds of details to ensure ChatGPT’s ideas align with how you actually want to conduct business and operations.

ChatGPT also broke this section into the following subsections:

• Business model
  • Revenue model
  • Value proposition
  • Key activities
• Product sourcing and supplies
• E-commerce platform
• Order fulfillment process
• Customer support
• Quality assurance
• Sustainability practices

5. Explain your marketing and sales strategy.

This business plan section outlines how the startup plans to build a brand, gain brand loyalty and attract customers. While ChatGPT did a great job with its suggestions here, designers and marketers typically need to refine this section further.

For example, under the branding subsection, ChatGPT made suggestions for logo and design, such as using boho elements like mandalas, feathers or natural motifs. However, ChatGPT can’t actually design a logo or establish a brand voice.

This section contains the following subsections:

• Branding
• Marketing channels
• Sales strategy
• Customer engagement
• Advertising

6. Detail the financial plan.

The financial plan portion of a business plan outlines crucial elements like startup costs, revenue goals, pricing strategy and profitability projections. This area is incredibly helpful for new entrepreneurs because it forces them to address several elements that may not be readily apparent, such as various costs and monthly revenue targets.

However, at this point in your work with ChatGPT, consider this section no more than a first draft. All estimates will be based on ChatGPT’s understanding of the market as it consults its most recent data sets. This information can vary widely depending on your ChatGPT plan and may be anywhere from current to several years old.

As we worked with ChatGPT on this section, we noted that it included broad estimated ranges based on estimated factors. When you use ChatGPT to help with your financial plan, address this section carefully. Use ChatGPT as a guide but research and develop your own data to ensure accuracy and realistic figures.

Subsections of this part of the plan include the following:

• Financial costs
• Pricing strategy
• Revenue goals
• Profit margin
• Break-even analysis
• Scaling strategy

7. Set your implementation timeline.

The final section of the business plan is the implementation timeline; this is where we asked ChatGPT to help provide a step-by-step guide to the dropshipping business’s launch. An implementation timeline provides greater detail about the early weeks and becomes less detailed further out in time. This is intentional, as startups have several significant hurdles to tackle at the beginning to hit the ground running.

ChatGPT’s early timeline addressed the first weeks, while the end zoomed out to multiple months of scope. However, ChatGPT provided ample instructions even into the first year of operations.

Subsections of the timeline include:

• Phase 1: Preparation (weeks 1-4)
• Phase 2: Launch (weeks 5-8)
• Phase 3: Growth and optimization (months 3-12)

Advanced resources to improve your ChatGPT business plan

ChatGPT’s default functionality — with a little bit of prompt engineering in the form of discussion role, context, responsibility and instruction — gave us the beginnings of a great business plan. Note that ChatGPT and the provided prompt are meant to be conversational. For each specific section, you can and should go back and forth with the AI tool on additional details, nuances or questions about the business plan.

Beyond working with ChatGPT’s core functionality, consider using its built-in plugins, which are designed to provide additional specific functionality. These plugins operate inside ChatGPT and can contain additional algorithm training to provide even more functionality for business plan development.

Two plugins worth checking out are:

• ChatGPT Business Plan Builder
• ChatGPT Business Plan Generator

Limitations of using ChatGPT for business

We found ChatGPT to be an excellent tool for helping us brainstorm topics like business ideas, names and supplier lists. However, the chatbot can’t perform actions like registering a domain or browsing a supplier’s website. It can provide suggestions, but you still need to actually, you know, do the work.

Many of ChatGPT’s marketing ideas were great starting points. Plus, it helped us develop a basic marketing strategy using proven, cutting-edge methods. But, we still needed to execute. That fact is why our bohemian decor store remains a figment of ChatGPT’s imagination and not a real-life business venture.

Clearly, AI won’t be replacing entrepreneurs anytime soon, but our exercise shows that it can certainly help them. Already, digital assistants are increasing productivity in the workplace. Tools like ChatGPT can automate tedious tasks and give you more time to think creatively and do the real work to grow your business.

An AI Elon Musk bot might still be a long way off, but AI personal assistants are here already.

Mike Berner contributed to this article.