5 Year Business Credit & Funding for House Flipping Guide

What is Our 5 Year Business Credit & Funding for House Flipping Guide All About?

It’s about finding business credit—and funding for house flipping. Your business has stages, and they all correspond to types of financing and business credit. We’ll get to those later.

Where Do You See Your House Flipping Business in Five Years or More?

Do you double your revenue? Replace your equipment? Hire people, or more people? Retire and pass your house flipping business along to a family member or sell the company? Something else?

Your House Flipping Business’s Plans and Future

All these scenarios for house flippers will require funding! Even going concerns with stable, steady revenue can experience emergencies, or need to seize a business opportunity quickly and before they have the funds. All businesses can use business credit to achieve their aims – whatever they are. But instead of year by year, let’s go phase by phase since there is some overlap in time. So even if you’ve already been through some phases, checking out the earlier phases could help you see if you missed anything. And if you’re just starting out, checking out the later phases could show you how to start flipping houses with financing in the future so you can be ready.

Phase 1: Setup and Launch

We have liftoff! Setting up a business is a task with a lot of moving parts. It’s a lot more than just saying you’re in business. The way the business is set up can directly affect the ability of your house flipping business to succeed. This first phase covers your first six to twelve months of existence.

Fundability

Fundability is a business’s ability to get funding. A lot of the power to get business money is in the hands of house flippers. A business starts with no credit profile. As a result, what’s on an application is all that’s reviewed for approvals. So your application must be very strong. Nearly half of all companies fail in their first 5 years, and about 2/3 in the first 10. As a result, new businesses don’t seem fundable to lenders. You can change that by building for fundability from the very start and get more funding for house flipping.

Business Name

Check with your Secretary of State –a business name may have to be unique. Make sure your SOS has all the necessary, up to date, and correct information for your company. Make sure that you are in good standing with them and that your entity is active. You will have to file annual reports and pay an annual fee to stay active.

Keep the name of a high-risk or restricted industry out of your business name. Your flipping business can be Amy’s rather than Amy’s Fix and Flip. There is nothing underhanded about this; it is completely legitimate and honest.

A common reason for loan and credit card application denials is the lender can’t easily locate a business offline or online. So make it painfully easy for lenders and credit providers to find your flipping business. Make sure the business name is exactly the same on corporation papers, licenses, utility statements, and bank statements. Also make sure the business name and all other information is the same on every online listing you can find.

Business Address

This must be a real brick and mortar building, a deliverable physical address. This can never be a UPS box or a PO Box. Some lenders will not approve and fund unless this criterion is met. A virtual address can also be a good idea if you need to hold a meeting or an interview, and it’s a lot more professional than doing this at your kitchen table. We like Regus, Davinci, and Alliance Virtual Offices. But keep in mind that we know of at least one credit issuer that will not accept virtual addresses.

Business Entity and EIN

Get a free EIN for your flipping business and choose your business entity at IRS.gov. Use your EIN to open a bank account and to build a business credit profile. To truly separate business credit from personal credit your business must be a separate legal entity, not a sole proprietor or partnership. Only incorporating creates a new and separate entity which by default will reduce your personal liability. Other entities (like partnerships) don’t. File this with the Secretary of State for your state. Make sure to set your entity up in the same state as your business address.

NAICS Codes

The IRS website is also where you choose NAICS codes, which are for the purpose of collecting, analyzing, and publishing statistical data on the US business economy. Per the NAICS, the 236118 code covers Residential Remodelers. This code also covers general contractors for home improvement.

The good news is, 236118 is not on the NAICS list of high risk and cash-intensive businesses. But that list is from 2014 and does not appear to have to been updated. It makes sense to err on the side of caution. Hence, to be on the safe side, it makes sense to keep the words like ‘flipping’ and ‘fix and flip’ out of the business name, as any industry with a low barrier to entry is bound to have higher risks than the norm.

Business Licenses

Contact State, County, and City Government offices to see if there are any necessary licenses and permits to operate your flipping business. Licensing requirements differ depending on state, town, and industry. Always make sure you have the proper licensing for your corporation. Being fully licensed builds credibility in your house flipping business, and that can help you get more customers.

Business Phone and 411 Listing

It’s quite easy and inexpensive to set up a virtual local phone number or a toll free 800 number. A cell or home phone number as your main business line could get you flagged as un-established – but VOIP is okay. If you don’t want customers calling you all day, do not use a personal cell phone as the business phone number.

It also helps with fundability to have a dedicated business phone number. Your number must have a listing with 411 for most credit issuers and lenders to approve you. Check for your record to see if you’re listed and your information is accurate. No record? Then use ListYourself.net to get a listing.

Web Domain and Professional Website

Lenders and credit providers will research your corporation on the internet. It is best if they learned everything directly from your corporate website. Not having a professional website can hurt your chances of getting corporate credit. Buy web hosting from a hosting company like GoDaddy or HostGator.

Your domain should be your business name, if possible. Add a company email address for your flipping business on the same domain as your website. This often comes with a website domain provider. This is not just professional; it also greatly helps your chances of getting approval from a credit provider. Do not use Yahoo, AOL, Gmail, Hotmail, or similar kinds of email.

Business Bank Account in the House Flipping Business’s Name

You must have a bank account devoted strictly to your flipping business. The IRS does not want you commingling funds. Make accounting easier and reduce the risk of audit at tax time. Keep personal and business funds separate. Having a business-only bank account makes that easy.

Get Set Up With the Business Credit Reporting Agencies

Go to D&B’s website and look for your business. Can’t find it? Then get a free D-U-N-S number on the D&B site. A D-U-N-S number plus 3 payment experiences leads to a PAYDEX score. You need a D-U-N-S number to start building business credit. Once you are in D&B’s system, search Experian and Equifax’s sites for your business.

Business Credit History

Get the most favorable funding by paying all bills on time. This way, you get:

  • A PAYDEX score of 80
  • Equifax Credit Risk Score of 90 or better
  • A good FICO SBSS score, which is driven (in part) by on-time payments and business credit history

For Experian, historical behavior (payment history) is 5-10% of the total score

Business Credit Building from the Ground Up

Start with vendor accounts, a proven way to start building business credit. Vendor credit is generally not attached to a bank. So under federal law a Social Security number is not necessary. When not attached to a bank, there is no Social Security requirement for starter vendor credit. This is unlike bank loans and bank cards. You can legitimately leave the SSN field blank, to force them to pull your business credit under your EIN.

Using Business Credit Vendors

Check out four of our favorite starter vendors for the house flipping industry:

  • Grainger
  • Marathon
  • Uline
  • Home Depot Pro Institutional

Grainger

They report to D&B. They work with more than 1,300 suppliers. Grainger sells electrical products, fleet maintenance, HVACR, hardware, janitorial, power tools, pumps, and more. If a business doesn’t have an established credit, they will require additional documents. like accounts payable, income statement, balance sheets, etc. There is no minimum order amount necessary to report but Grainger does prefer for a business to have at least a $50 payment history. Apply online or over the phone. Terms:  Net 30.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address (matching everywhere)
  • D-U-N-S number
  • Flipping business license(s), if applicable
  • Business Bank account
  • Business registered with the Secretary of State for at least 60 days

Marathon

Marathon Petroleum Company provides transportation fuels, asphalt, and specialty products throughout the United States. Their product line supports commercial, industrial, and retail operations. Marathon is under the Wex umbrella. This card reports to Dun & Bradstreet and Experian. Before applying for multiple accounts with WEX Fleet cards, make sure to have enough time in between applying so they don’t red-flag your account for fraud.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address- matching everywhere.
  • D-U-N-S number
  • Flipping business license(s), if necessary
  • And a business bank account
  • Business phone number with a listing in 411
  • Good D&B PAYDEX score of 80 or higher

Must also have a good Experian business credit score. Your SSN is necessary for informational purposes. If concerned they will pull your personal credit talk to their credit department before applying. You can provide a $500 deposit instead of using a personal guarantee if you’ve been in business less than a year. Apply online or over the phone. Also, their terms are Net 15.

Uline

Uline is a distributor of shipping, industrial, and packing materials, and industrial and janitorial products. 99.5% of Uline’s orders ship the same day, with no backorders. This card reports to: D&B and Experian.

To qualify, you need the following:

  • Corporate entity must be in good standing with the applicable Secretary of State
  • An EIN
  • Company address matching everywhere
  • D-U-N-S number from Dun & Bradstreet
  • Your Flipping business license(s), if necessary
  • A business bank account
  • Business phone number with a listing in 411

Uline prefers that a business has a good credit profile with D&B, but this is not necessary. Your application may get approval for net 30 at the time of order. But upon final review, their credit department may change to a few prepaid orders before granting a net 30. Apply by creating an account first, then place an order and select Net 30 terms. Their credit department will then review the account. Also, their terms are Net 30.

Home Depot Pro Institutional

Home Depot Pro is a single-source supplier for facilities maintenance supplies, including everything from cleaning and janitorial supplies and PPE to plumbing parts and lighting products. If in business for less than 1 year, they require at least 2 prepaid orders using their credit cards over the course of 90 days. Must be an active web customer for 90 days to apply for Net 30. No minimum order necessary.

They will not accept virtual addresses. You should be in business at least 1 year to qualify. Reports to Experian. Also, their terms are Net 30.

To qualify, you need the following:

  • Your corporate entity must be in good standing with the applicable Secretary of State
  • An EIN
  • Company address matching everywhere
  • D-U-N-S number from Dun & Bradstreet
  • Your Flipping business license(s), if necessary
  • A business bank account
  • Trade and bank references

Business Credit Building with Credit Cards with a PG

Every step and every credit provider is designed to help your house flipping business. It’s meant to help you qualify for business credit cards that you will actually use. As you continue building, your time in business will help. But to get started, you may need to give a PG. That’s okay; that’s a part of the strategy.

PG (Personal Guarantee) Financing

According to Investopedia, a personal guarantee is:

“an individual’s legal promise to repay credit issued to a business for which they serve as an executive or partner. Providing a personal guarantee means that if the business becomes unable to repay the debt, the individual assumes personal responsibility for the balance. Personal guarantees provide an extra level of protection to credit issuers who want to make sure they will be repaid.”

When you provide a PG, you are adding your Social Security number to the application. You should expect a hard inquiry. You’re also adding the details of your personal income to the application.

Good Personal Credit and Funding for House Flipping

If you already have good personal credit, then you’re all set. But if not, you can work with a credit partner or guarantor. And never stop working to improve your personal credit, no matter what shape it’s in.

Phase 1 Funding for House Flipping Option: Our Credit Line Hybrid

A credit line hybrid is a form of unsecured funding. Our credit line hybrid has an even better interest rate than a secured loan. Get some of the highest loan amounts and credit lines for businesses. Get 0% business credit cards with stated income. These report to business CRAs so you can build business credit at the same time. This will get you access to even more cash with no PG. You need a FICO credit score of at least 680 or a guarantor with good credit to get an approval. No financials necessary.

Phase 1 Funding for House Flipping Option: 401(k) Financing

This is not a loan, and you will not have to pay an early withdrawal fee or a tax penalty. You put the money back by contributing, just like with any 401(k) program so you won’t lose your retirement funds. The IRS calls this a Rollover for Business Startups (ROBS), which is a separate entity with its own set of requirements. The plan, through its company stock investments, rather than the individual owns the trade or business.

This financing isn’t a loan against, your 401(k), so there’s no interest to pay and does not use the 401(k) or stocks as collateral. Instead, this is simply a movement or change of custodian. our 401(k) must have more than $35,000 in it and cannot be from a business where you are currently employed. You can get 401(k) financing even with severely challenged personal credit.

Phase 1 Funding for House Flipping Option: Stocks Financing

Some lenders will make loans using securities as collateral. Securities-based lending provides ready access to capital. The only restrictions to this kind of lending are other securities-based transactions, like buying shares or repaying a margin loan. You continue to earn interest on stocks pledged as collateral. But you will have challenged personal credit.

Phase 1 Funding for House Flipping Option: Sell Part of Your Flipping Business’s Equity

Your fix and flip business and its potential are assets. Talk to people you know about angel investing. Angels buy a smallish stake in your company. They usually don’t expect as big a return as venture capitalists do. VCs might also buy a stake, but they generally just want paradigm-changing businesses. Most house flipping companies won’t fill the bill unless your take on the industry is utterly unique. Another way to sell a part of your equity is to take on another founder or partner.

Phase 1 Funding for House Flipping Option: Crowdfunding

Crowdfunding success has no guarantees. Crowdfunding platforms like Kickstarter will take a percentage of any money you raise. But it can still be a way to get a cash infusion without having to give up equity. If you’re particularly good online and have a compelling service and story, then you’re more likely to succeed than most people. And it can be a way to start flipping houses with no money.

Phase 1 Funding for House Flipping Option: Grants

Grants can come from the government or private businesses. Expect a lot of competition, difficult entry requirements, and not a lot of money. But it’s another way to get some cash without having to sell a chunk of your flipping business. You may find there are few grants for the flipping industry, but you may be able to score grants based on the kind of entrepreneur you are, e. g. female, disabled, LGBTQ+, etc. Also check under terms like gentrification and rehabilitation.

Phase 1 Goals for Credit and Funding for House Flipping

Right now, you have minimal Growth Monthly Revenue (GMR). This is a fast paced growth house flipping business plan, throw it against the wall and take what you can get right now. Look at some short sighted daily and weekly goals for quick cash and growth. During this phase, your focus is on the bare essentials to create a viable business. Your goal is to build your consistent revenue to $10,000 per month and continue to work to improve your personal credit.

Phase 2 Development: $1,000 to $10,000 GMR

In Phase 2, start developing marketing Now you’re at an aggressive sales pace adding nurture and longer sales cycles. Use medium term monthly growth planning (campaign to campaign). It’s time for software implementation and system development. You’re building the blocks of how your flipping business is going to be, now and in the future. This phase should run somewhere between the first six to 24 months from launch.

Phase 2 Credit Options

Your credit options will increase once you get to Phase 2, including:

  • Business credit cards (No PG)
  • Advanced vendors
  • Vehicle financing
  • Tier 2 business credit
  • Cash flow management with providers like Brex and Divvy

Business Credit Cards With No Personal Guarantee

As you continue to build exceptional business credit and pay your bills on time, credit providers trust you even more. You can get higher limits and better terms. And you can start to get business credit cards with no PG.

No PG Financing

With no PG financing, you can get higher limits and better terms. Continue building exceptional business credit and pay your bills on time. In general, the following will reduce the need to provide a PG for this type of house flipping financing:

  • Good business credit
  • A decent amount of time in business or
  • Good personal credit

Much like with any other kind of business borrowing, the more assurances you can give the lender, the better.

Advanced Vendors

There are many vendors who do not report to the business credit reporting agencies unless you default. But they’re still a good idea, because credit can help you beyond business credit building. Not having to put up 100% of the costs of equipment or a building or anything else can help with budgeting. Credit can sometimes be the only way to take advantage of a limited time opportunity if you don’t have the money right now. And if your business credit cards offer rewards, cash back, or points, then using them is to your advantage.

Vehicle Financing for Funding for House Flipping

Vehicle financing is a great way to get a pickup truck or other business vehicle without having to wait until you can just pay cash and drive it off the lot. Note: it may be necessary for business owners to personally guarantee vehicle loans. If you are a co-borrower, the loan will most likely report to your personal credit report. Some loans have a prepayment penalty and charge you for paying ahead. It is a good idea to have a loan proposal. A loan proposal should detail your flipping business, loan needs, and financial statements. Here are a couple of vehicle financing choices from us.

Ford Commercial Vehicle Financing Through Credit Suite

Ford offers several commercial vehicle financing options. These include loans, lines, and leases to actual business entities. This is not for sole proprietorships. Get a loan or a lease.

Ford may ask for a PG if you don’t get approval on the merit of your application. Apply at the dealership. Ford will report to D&B, Experian, and Equifax.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address- matching everywhere
  • D-U-N-S number
  • Flipping business license(s), if necessary
  • And a business bank account
  • Strong business credit history
  • At least 1 year in business
  • Must have a good Experian business credit score, good Equifax business credit score, and PAYDEX of 80+

Ally Car Financing Through Credit Suite

Ally provides personal financing. But they will also report to business credit bureaus. If your flipping business qualifies for financing without the owner’s guarantee, you can get financing in the business name only. Ally will report to D&B, Experian, and Equifax.

Ally Commercial Line of Credit

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address- matching everywhere
  • D-U-N-S number
  • Flipping business license(s), if necessary
  • And a business bank account
  • Bank reference
  • Fleet financing references
  • Good PAYDEX of 80+

If you provide a PG, Ally will not report to the personal credit bureaus unless the account defaults.

Ally Commercial Vehicle Financing

Get a lease or a loan. To qualify, you need most of the same things as you need for an Ally Commercial Line of Credit, except for a bank reference and fleet financing references. There is no minimum time in business requirement. Apply in person only, dealer will advise if you’ll get approval or if a PG is necessary.

Tier 2 Business Credit

With at least 3 Tier 1 vendors reporting, Tier 2 starts to open up. Here are five of our favorite Tier 2 vendors to help you with your house flipping business:

  • Quill
  • United Rentals
  • Home Depot
  • Northern Tool
  • Amazon

Quill

Quill sells office supplies, cleaning supplies, handheld computers, and more. If not given a Net 30 they will ask for prepaid orders of $100. Normally any prepaid order will not report but you need them to get a Net 30 account. Net 30 accounts require a $50 purchase to report. Sometimes an order is shipped, and the customer thinks they have approval, but this may not be the case.

New businesses or businesses with no credit history with D&B may need to prepay purchases for 3 consecutive months until Net 30 approval. It can take Quill’s credit department approximately 3 hours to process an application. Reports to D&B. Also, their terms are Net 30. Apply over the phone.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address- matching everywhere
  • D-U-N-S number
  • Flipping business license(s), if necessary
  • And a business bank account
  • At least 3 trade or credit references
  • PAYDEX of 80+
  • At least 3-5 trade accounts reporting on D&B credit report
  • At least 6 months in business

United Rentals

United is the largest equipment rental company in the world. Reports to Equifax. Apply online or at a local store. Also, their terms are Net 30 or Net 45.

No minimum time in business is necessary. No minimum purchase to report. Need an established business credit history (good Equifax business credit score) to have the option to apply without a PG. If Equifax business score is low, a PG is necessary.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address- matching everywhere
  • D-U-N-S number
  • Flipping business license(s), if necessary
  • And a business bank account

Home Depot

Home Depot offers a wide range of home improvement products. They offer both a pay in full and a revolving option. Reports to D&B, Experian, and Equifax. Apply online or at the store. Terms: Commercial Account (Pay In Full Terms) -Net 30 or Net 60; Commercial Revolving Charge Account -Revolving.

To qualify for either option, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address- matching everywhere
  • D-U-N-S number
  • Flipping business license(s), if necessary
  • And a business bank account
  • Business phone number with a listing in 411
  • Must have a good Experian business credit score and PAYDEX score of 80 or higher
Additional Terms Specific to Each Option

For pay in full terms, you also need:

  • They like to see at least 2 accounts reporting, but will look at the merit of your overall application
  • At least 3 years in the business
  • You can request Net 60 after account is established. If not enough business credit history or you have been in business for less than 3 years, a PG is necessary

For revolving terms, you also need:

  • No minimum time in business is necessary
  • But a PG is necessary

Northern Tool

Offers a wide selection of products—from consumer goods to industrial and construction equipment—to do-it-yourselfers, contractors, and professional shops. Reports to D&B and Experian. Apply online or at a branch. Also, their terms are Net 30.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address- matching everywhere
  • D-U-N-S number
  • Flipping business license(s), if necessary
  • And a business bank account
  • Business phone number with a listing in 411
  • Bank references
  • Trade/credit references
  • PAYDEX score of 80 or higher and good business Experian credit score
  • At least 3 years in business
  • If you don’t get approval based on business credit history or in business for less than 3 years, they may ask for a PG.

Amazon

You can get nearly anything at Amazon—including materials to stage finished homes for sale. Reports to D&B and Equifax. Apply online. Also, their terms are Net 55.

No minimum time in business if strong business credit history. You should have at least 2 years in business. Amazon will pull business credit reports to make sure there is some established business credit history. Must have a good PAYDEX score of 80 or higher and a good Equifax business credit score. If a company has been in business for more than 2 years but does not have an established business credit history, a PG is recommended but not necessary. It may increase the likelihood of approval and is recommended if you have a young or small business, and not enough business credit history.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address- matching everywhere
  • D-U-N-S number
  • Flipping business license(s), if necessary
  • And a business bank account
  • Business phone number with a listing in 411

Cash Flow Management

Managing small business finances can be overwhelming. There are several tools that can help streamline the process. Options like Brex, Divvy, Expensify, Lola, and more are growing in popularity. Which one is right for your fix and flip business?

Brex and Divvy

Brex and Divvy are business money management systems that integrate with your accounting software. You can track expenses and, depending on the level of service you choose, can also help with paying bills and controlling spending. Also, Brex has a partnership with the FDIC and your funds are secure.

Virtually everyone that opens a Brex cash account gets a corporate card. Brex reports any payments to Dun & Bradstreet. Divvy reports to the Small Business Finance Exchange, which in turn provides data to all SBFE partners, including business credit bureaus.

Phase 2 Options for Funding for House Flipping

In Phase 2, your funding options also multiply, to add:

  • Merchant cash advances
  • Revenue lending
  • Lines of credit (Fundbox)
  • Equipment financing/leasing
  • Invoice factoring

Merchant Cash Advances

MCAs technically aren’t fix and flip loans; it’s a cash advance based on the credit card sales of a business. A small business can apply for an MCA, and have an advance deposited into its account quickly. So you can offer Net 30 terms but not have to wait a month to get paid. With an MCA you get funding based strictly on cash flow as verifiable per business bank statements. A lender mainly just wants to see consistent deposits.

Business Revenue Lending for Funding for House Flipping

You can technically qualify with only one year in business, but the annual revenue requirement is high enough that phase 2 may make more sense. You can raise capital from investors who get a percentage of the enterprise’s ongoing gross revenues in exchange for money invested until a predetermined amount is paid. Often this predetermined amount is between 3 – 5 times the original amount invested. Monthly payments will fluctuate with revenue highs and lows and will continue until you’ve paid back the loan to flip a house in full.

Fundbox

Fundbox will connect directly to your online accounting software when deciding whether to fund your flipping business. They will auto debit your weekly payment from your bank account. But Fundbox does not report to the business credit reporting agencies.

You need to have:

  • Accounting software you have used for at least 2 months with at least 6 invoices
  • A business checking account
  • Active business checking account for 3+ months with 30+ transactions
  • Annual Revenue of $100,000 or more
  • A FICO score of 600 and up with Experian

Equipment Financing

Use a loan or lease to purchase or borrow hard assets for your flipping business. Physical assets can include items such as a pickup truck or a laptop. Pay predictable amounts every month. You can build business credit on a program like this.

Equipment Leasing

Or lease equipment, rather than buy it outright. You will often put down less money than you would if you were buying the equipment. You may be able to negotiate flexible terms with an equipment lease, and it’s easy to upgrade equipment after your lease ends. This is helpful if your equipment is something like a computer which quickly becomes obsolete.

Equipment Sale-Leaseback

If you already own your equipment free and clear you can use that as collateral for financing. Sell equipment to a lender for cash. Then lease it back from them. You can unlock Section 179 tax savings, and depreciate your entire equipment purchase in the first year. You’ll need at least one larger piece of higher value equipment to qualify. A pickup truck should do nicely.

Invoice Factoring

If you have open invoices and are extending credit to customers in some form, then you can get paid faster with factoring. Usually this involves invoices with net terms, like net 30, 60, or 90. To be paid faster, you turn those invoices over to a factoring company. They immediately give you an agreed upon percentage of the total of the invoices, like 80%. When your customer pays, the factoring company keeps their fee, and they send you the rest. But keep in mind – factoring only works if your customers pay.

Phase 2 Goals for Credit and Funding

Strong business credit (10 to 12 Accounts). Good personal credit will always help. Build consistent revenue to $10,000 or more a month. Always develop business connections in your community and with potential lenders.

Phase 3: Growth: $10,000 to $2 Million GMR

Successful growth…it’s working! It’s time to start optimizing systems and operations. So, you’ll be undergoing massive team and infrastructure development, and long term growth and planning for semi-annual to annual focus lifetime customer value. You’ll need to make some high level strategic hires (Managers, VP’s, Essential C levels). This phase will happen at about 24 months or more from launch.

Phase 3 Credit Options

Your Phase 3 credit options put your Phase 1 and Phase 2 options on steroids, with:

  • Team access to vendors and cards
  • Continue to buy pickup trucks and other vehicles with vehicle financing
  • Vendor Portfolio Growth

Phase 3 Options for Funding for House Flipping

Phase 3 opens your funding options up to:

  • All Alternative options available
  • SBA Loans
  • Bank Loans
  • Tier 3 and Tier 4 Business Credit

Alternative Options

Alternative lending can mean online lending. For certain industries, online lending is one of the only ways to get money. Before you dip into your savings, investigate house flipping business lending. Because lenders that specialize in the fix and flip industry lending are out there.

SBA Loans

More time in business will make SBA loans a real possibility for your flipping business. It’ll be easier to get an SBA loan in Phase 3 versus earlier. This is because you can more readily show your fix and flip business is established and making money. Demonstrated profitability and responsible credit and bank account management will improve your chances of getting an approval for an SBA loan. SBA loans have great terms. There’s a reason why you should be striving to be eligible for one.

Bank Loans for Funding for House Flipping

Banks are often the first place we think of when we think of financing. But big banks only sign off on about 25% of the small business loan applications that come their way. Term loans often have lower interest rates than many other funding options. Also, they also tend to be for higher loan amounts. But you will most likely have to undergo a personal credit check and/or provide collateral.

Phase 3 Goals for Credit and Funding for House Flipping

In Phase 3, your mission is to take your flipping business to the next financial level, so your goals are:

  • Profitability (to calculate loans for flipping houses)
  • Maintaining good personal and business credit
  • Build up to $2,000,000 in annual gross revenue
  • Maximizing leverage of cash flow with vendors and business credit

Grow Your Vendor Portfolio with Tier 3 Business Credit

Buy everything from office supplies to power tools. Vendors will check whether your business information is uniform everywhere. They will also check if your flipping business is properly and thoroughly licensed (if necessary). Also, terms can be revolving. You will need at least 6 (more is always better) accounts reporting to the business CRAs.

Here are two Tier 3 vendors we love:

  • TSC Tractor Supply
  • Kleer Card

You will generally need some time in business before you can get approval.

TSC Tractor Supply

Buy tools and hardware, home goods, and more. Reports to D&B and Equifax. Apply online or at the store. Also, their terms are revolving.

You must have trade accounts reporting to all 3 major business credit bureaus for at least 3 years. Must have a good Experian business score and a good PAYDEX score of 80 or higher. Also, you must have a good Equifax business credit score. If any above criteria is not met, a PG may be necessary. Providing a guarantee may increase the likelihood of approval and is recommended if you have a young or small business.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address (matching everywhere)
  • D-U-N-S number
  • Flipping business license(s), if applicable
  • Business Bank account
  • At least 3 years in business

Kleer Card

Kleer Card helps with expense tracking, controls and issuing of credit cards all on one platform. Get accounting solutions for your flipping business. No PG necessary. Reports to D&B, Experian, and Equifax. Apply online or over the phone. Also, their terms are Net 7.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • Business credit history
  • EIN number with IRS
  • Business address (matching everywhere)
  • D-U-N-S number
  • Flipping business license(s), if applicable
  • Business Bank account
  • Bank references
  • Average bank balance of at least $15,000

Grow Your Vendor Portfolio with Tier 4 Business Credit

To get to Tier 4 means you have at least 9 accounts reporting. Terms can be revolving. To ensure that your vendor’s report your payments, make a purchase of $50 or more. Also, there may be a minimal time in business requirement.

Here are 3 Tier 4 vendors we love:

  • Sam’s Club
  • Sutherlands
  • Menards

Sam’s Club

Sam’s Club offers office supplies, business furniture, janitorial/cleaning supplies, paper products, computers, and more. Reports to D&B, Experian, and Equifax. Apply at the store. Also, terms are revolving.

To get approval without a PG, it helps to have $5 million in annual sales or revenues and/or at least 2 years in business, and/or more than 10 employees. A PG is necessary if your company is a sole proprietorship or partnership. Cash advance available with business credit card approval, amount of cash advance depends upon approval amount.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address (matching everywhere)
  • D-U-N-S number
  • Flipping business license(s), if applicable
  • Business Bank account
  • Business phone number with a listing in 411
  • Must have club membership
  • Must have a good PAYDEX score of 80 or higher

Sutherlands

The Sutherland Lumber Company specializes in complete building packages, including storage sheds, garages, post frame buildings and pole barns, and entire houses. You have the option to apply with business liability only, Sutherlands will advise if you get approval, or a PG is necessary. Also, if you don’t get approval based on business credit history, a PG is necessary. Reports to D&B. Apply online or at the store. Also, their terms are revolving.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address (matching everywhere)
  • D-U-N-S number
  • Flipping business license(s), if applicable
  • Business bank account
  • Business phone number with a listing in 411
  • Good PAYDEX of 80+

Menards

Menards offers a complete selection of name brand merchandise, tools, materials and supplies for all home improvement needs. Their Commercial Credit card has no annual fee and its own line of credit. You will need strong business credit history with good PAYDEX score of 80 or higher and a good Experian business credit score. You must have at least 3 years in business. If your business is a nonprofit corporation, corporation or LLC, a PG is necessary if the business is less than 3 years old. Reports to D&B and Experian. Apply online or at the store. Also, their terms are Net 30 or Net 50.

To qualify, you need:

  • Entity in good standing with Secretary of State
  • EIN number with IRS
  • Business address (matching everywhere)
  • D-U-N-S number
  • Flipping business license(s), if applicable
  • Business Bank account
  • Business phone number with a listing in 411
  • Trade/credit references

Phase 4: Maturity: $2M to 5M+ Annual Income

Consistent growth is key. You’re aiming for long term consistent and stable growth and moving toward market domination (Competitor Buyouts and Acquisitions). Product development and expansion becomes critical for longevity. Now it’s time for the big hire. You’re going to fill out C Level, Directors, and middle management. Yes, your flipping business can become this big! This phase will happen at around four to five years from launch.

Phase 4 Credit Options

By Phase 4, the sky is pretty much the limit! You should be able to get:

  • Most major credit cards with no PG
  • All vendors should be accessible

And you should be able to leverage reports for specific vendors. This also includes asking for a credit line.

Phase 4 Options for Funding for House Flipping

In addition to everything we’ve already talked about, your house flipping business can potentially take full advantage of private equity and/or investors. You might even sell shares in your corporation or go public!

Phase 4 Goals for Credit and Funding for House Flipping

Now you’re playing the long game. Your mission is to look to the future and help your flipping business for decades to come. Therefore, you need to balance your costs vs your cash flow vs your business’s profit. And you need to leverage funding for expansions and buyouts. Also, you should be maximizing leverage of cash flow with vendors and business credit.

Phase 5: Exit

By this time, your business should be very well established. At this phase, you want to cash in on all the work you have invested. This is where the funding and credit has the long game return. A Business Credit Portfolio is transferable and increases the value of your fix and flip business.

Your proven track record with merchant cash advances or revenue lending pays off big time, since it can keep business cash flow moving through the ups and downs. Having a proven track record with the SBA, and a profitable banking relationship, will improve the value of your flipping business as well. People want to buy something they can lend against if they need to.

Phase 5 Options for Funding for House Flipping

Selling can mean you’re retiring, or maybe you’re exchanging one form of entrepreneurship for another and want to change industries yet remain an entrepreneur. In Phase 5, you can:

  • Self-fund the sale in structured buy outs
  • Go to the SBA for acquisition money

In essence, you should be prepared to sign for your own buyout. A profitable, seasoned flipping business can be an exceptionally valuable legacy.

Your 5 Year Business Credit and Funding for House Flipping Guide: Takeaways

Your financing and credit options will change, from your startup to your exit. It may be tricky to navigate the nuances. Let us work with you–we’ve got the design!

The post 5 Year Business Credit & Funding for House Flipping Guide appeared first on Credit Suite.

Meticulous (YC S21) is hiring #2 founding engineer in London

Hey HN, I’m Gabriel, founder of Meticulous. Our mission is to make the world’s code safe, performant and reliable. We’re starting with a tool to catch JavaScript regressions in web applications with zero-effort from developers. How it works: Insert a single line of JavaScript onto your site, and we record thousands of real user sessions. … Continue reading Meticulous (YC S21) is hiring #2 founding engineer in London

How to Make Small Business Saturday an Unqualified Success for Your Business

Small Business Saturday Can Be One Key to Business Success

We talk about business funding and fundability, and business credit building a lot. But they’re not just as a means to an end. We also see all three of these areas as pathways to business success. One strong pathway is higher sales. That’s where Small Business Saturday comes in.

What is Small Business Saturday?

American Express created Small Business Saturday (SBS) in 2010. It takes place right after Black Friday, the day after Thanksgiving. Black Friday is the day major retailers get ‘in the black’ when it comes to their budgets. It is also the unofficial kickoff to holiday shopping.

But Small Business Saturday is meant to be part of the ‘Shop Small’ movement. The intention is to convince consumers to do more of their holiday and other shopping at small businesses. Organizations across the country sign up to serve as Neighborhood Champions. These supporters bring their community together with events and activities on SBS and throughout the year.

Let’s look at some resources to help your business do Small Business Saturday right.

Amex Small Business Saturday Resources for Small Businesses

Amex offers customizable posters and other tools for businesses in the following industries:

  • Beauty
  • Retail
  • Dining

Plus they offer resources for businesses 100% online or catering to B2B.

There’s an Amex ‘general’ toolkit as well. It includes three printable images. There are three social media posts for Facebook, Twitter, and the like. And there’s one larger good quality poster.

Getting Ready

In 2020, Big Commerce made several predictions on how SBS would go that year. With the Delta variant surging, the 2021 holiday shopping season is looking a lot like 2020. Hence the predictions may still be valid.

SBS Prediction #1: More Online Traffic

Even without stay at home orders, consumers may voluntarily want to stay inside more. This can be out of an abundance of caution or concern for the health of loved ones. And what do they do when they’re stuck indoors? A lot of them go shopping online.

SBS Solution #1: Attract That Increased Online Traffic

Baby boomers and Gen X, in particular, love online sales. In 2020, Facebook Business found that 80% planned to Christmas shop online at least to some extent. Adobe predicted that search engines like Google would drive 46.5% of 2020’s online shopping revenue. And Adobe also said social media would drive awareness but not sales.

This means you want to amp up your holiday SEO. Invest in seasonal content. Perform keyword research on holiday phrases. And create landing pages for any holiday and seasonal offers.

SBS Prediction #2: More Sales

Last year, stimulus checks drove at least some spending. But consumers may still be keen to pamper themselves, even if they don’t have an extra few thousand or so to spend. And even if extra unemployment payments have stopped.

SBS Solution #2: Attract Those Dollars and Sales

Creating landing pages is one great way to bring customers in. You can create a landing page focusing on just, say, your newest product line. Give every bit of information you think customers would want to know. Like prices, colors, shipping costs, size choices, and more.

Use high resolution photography showing off your wares to their best advantage. Even purely service businesses can photograph their location or staff.

Customers with long lists will love what is essentially one-stop shopping. And of course you want it to be easy to add an item to their carts, and check out. Also, make it easy for customers to get in touch if they have questions.

You can also reposition your products and services around the holidays. Or create bundles of related products at various price points. Like adding grooming products to an attractive basket or tin and calling it a spa sampler. Or bundling products and services like a coupon for a percentage off a haircut with one for a free manicure and one for a free bottle of nail polish or a high-end hairbrush and calling it a day of beauty.

SBS Prediction #3: New Customers

In 2020, the supply chain was disrupted. Again, 2021 is looking a lot like 2021. As a result, consumers are checking online more than ever. They may also be more amenable to accepting second choices. Or they may be open to trying something new.

Consumers may also want to support businesses which support their values. For example, these can be Black-owned businesses, or women-owned businesses. Per Facebook Business, nearly two-thirds of consumers surveyed were open to new products during the holidays.

SBS Solution #3: Welcome Those New Customers With Open Arms

Got a new customer’s email address? Then why not send them a coupon for a certain percentage off their next purchase? And consider a single question upon checkout. Here’s one: Where did you learn about us?

But Small Business Saturday also comes with some challenges.

SBS Challenge #1: Consumer Awareness

We tend to see a lot more ads for Black Friday, or Cyber Monday, than for SBS. Will your customers forget the date?

Address SBS Challenge #1: Spread the Word

Add website banners, even months in advance. Ask your local Neighborhood Champions for support and ideas. Set up ad retargeting on social media. Consider a delivery strategy of buy online, pick up in store, to get customers in the door.

SBS Challenge #2: Customer Reluctance

How do you convince customers to shop from you and not bigger stores? How do you stand out from the competition? Smaller businesses tend to not have a lot of wiggle room to slash prices. So how do you get customers to choose you?

Address SBS Challenge #2: Personalize!

Small Business Saturday Credit SuiteYou have what the big players don’t. You can personalize, even online purchases! Stand out by treating customers like the individuals they are.

Try hosting online events, or add a personalized note to a delivery. or put customer service front and center. And consider working with other small businesses in the area. Your discounted pedicure could work perfectly with a coupon from a nearby shoe store.

Small Business Saturday: Takeaways

So, SBS is a creative way to bring in customers and help kick off the holiday season. You can make yours more successful with some digital sprucing up, and smart product and service repositioning. Partnering with another local business is another winning strategy.

The post How to Make Small Business Saturday an Unqualified Success for Your Business appeared first on Credit Suite.

New comment by raoulbhatia in "Ask HN: Who is hiring? (April 2021)"

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The post New comment by raoulbhatia in “Ask HN: Who is hiring? (April 2021)” first appeared on Online Web Store Site.

How to Use AI SEO to Improve Your Website

The internet has become the go-to source for everything from trivia about celebrities to fixing our kitchen sinks. But AI SEO may be changing the way marketers help their sites rank high on search engine results pages (SERPs).

Failure to rank may result in your business missing out on valuable search traffic. Which means far less revenue for your business.

For a long time, you could get by with basic SEO strategies.

But not anymore.

With artificial intelligence (AI) taking over the world, you need to up your game.

What does that mean for your SEO strategy?

What is AI?

Artificial intelligence (AI) is an umbrella term that covers several different technologies, including machine learning (ML), computer vision, natural language processing (NLP), deep learning, and other, still emerging technologies.

What’s the point of AI?

AI has one principal goal – to perform (often laborious and mundane) cognitive tasks better and faster than humans. It is a technology designed to make our work and life easier.

In business, AI has already proven to be effective in increasing revenue.

In sales and marketing, 30% of AI adopters cited a 6-10% increase in revenue after implementing the technology.

impact of ai

These are pretty impressive results.

And yes, AI can also be beneficial to your SEO.

But, will AI replace SEO?

Emphatically – no!

Let’s talk about how AI is impacting SEO and why it won’t be taking over.

What is AI SEO?

AI has become a core component of major search engine algorithms, including Google’s Rankbrain and BERT.

This factor means if you understand AI and how it impacts search engines, you can boost your SEO using AI.

But that’s not all.

AI is also an excellent tool for data analysis, which is a significant part of designing an effective SEO strategy.

From helping you spot trending topics to discovering content gaps, you can do tasks faster and more efficiently with AI-powered SEO software.

AI and SEO are a match made in digital heaven.

Why is AI SEO Important?

Although both AI and SEO are complex disciplines, used together, they make it easier for you to boost your website’s rankings.

One thing to keep in mind about search engines is they always put the user first. They aim to deliver content that’s as relevant as possible.

Because of this, SEO is not just about keywords anymore. It’s about:

  • Concepts: What is the idea behind the searchers’ query?
  • Context: What is the intent behind the searchers’ query?
  • Customer satisfaction: What are the most relevant answers to the user’s query?

So, keyword stuffing doesn’t work anymore (and hasn’t since Hummingbird). For your content to rank, you need a great link building strategy and to optimize for AI-powered search engines.

Today (and in the future), one of the main factors that impact ranking is user experience. And AI is one of the best ways to provide website visitors with a positive experience.

Let’s quickly look at six ways it can help boost your SEO.

AI SEO: 6 Ways to Use AI to Improve Your Website

Now that you understand what AI is and how AI SEO can impact your site, let’s look at a few ways you can use AI SEO to keep up with modern SEO tactics.

Opportunity Discovery With AI SEO

One of the most important aspects of SEO is discovering hidden ranking opportunities that haven’t been exploited.

That’s one of the areas artificial intelligence SEO is proving to be effective in helping boost your website’s rankings. Powerful AI-powered SEO tools have emerged in the last couple of years, giving you more in-depth insight into:

  • Keywords you should be targeting
  • Link building opportunities

These and other insights that you can get from AI-powered SEO software are crucial to crafting a content strategy that will exponentially boost your website’s SEO.

With the competition to rank becoming fiercer by the day, you need to find keywords, topic ideas, and other SEO opportunities that aren’t too common.

Find opportunities that your competition is not exploiting, and you’ll have a much better chance at ranking.

Granted, finding these opportunities manually takes a lot of creativity, time, and hard work.

However, with the help of AI-powered SEO software, like BrightEdge, you can uncover golden SEO opportunities faster.

This is one of the main reasons AI must be a part of your SEO strategy.

Content Creation With AI SEO

Discovering content opportunities is only a small part of the battle to dominate the SERPs.

You also have to create content that hits the mark.

This is where AI can help improve your SEO.

How?

Once you’ve used a tool like BrightEdge to find keywords, you can use AI to help you know what kind of content you should create.

Once fed with your target keyword, AI-powered tools scour the web for content created around that keyword. In a few seconds, you’ll find:

  • Content gaps to exploit
  • Trending topics
  • The average number of sections to include

With insights like these, it becomes easier to create content tailored to solve specific problems for your audience, in short, personalized content that satisfies user intent.

Not only that, but AI can help you ensure that the content you create is relevant for each stage of your funnel.

Content creation is no longer just about creating poor quality content that ranks. It’s about creating content that users will find helpful.

And that’s exactly what AI will help you do.

Content Optimization With AI SEO

For a long time, content optimization has been about keywords, internal links, backlinks, and other on-page SEO tactics.

Those things still matter.

But search engines now look at more than just those indicators. Search engines are getting better at figuring out precisely what searcher’s intent is while searching.

How can you optimize your content for user intent?

You guessed it – with the help of AI.

AI SEO tools help you:  

  • Create topic clusters that answer user questions and rank
  • Know the optimum length of content on your given topic
  • Use keywords and LSI keywords correctly

With AI, you can optimize your content to meet Google’s E.A.T standards found in their search quality raters, guidelines. You can create content that expertly answers user queries authoritatively. And that’s the kind of content Google loves to serve its users.

But AI doesn’t end at helping optimize content for search engines. AI-powered writing tools like Atomic Reach and Grammarly (among a slew of others) also help ensure your writing makes for a pleasant read.

AI seo example grammarly

This also helps increase dwell time, another factor that indicates to search engines that your content is useful.

The bottom line is AI can help you create better optimized content that your readers will love and engage with.

Optimizing for Voice Search

One of the fastest evolving areas of search is voice search.

With more people relying on their voice-activated devices to search the internet, voice SEO (VSEO) has become an aspect of SEO you can’t ignore anymore.

Just take a look at how fast the number of voice-activated assistants is rising:

ai seo voice assistants

Statista forecasts that the number of voice assistants globally will reach 8.4 billion in the next few years — which is more than the world’s population.

Most voice searches are in the form of questions, so one of the main ways to optimize for VSEO is by answering the questions people are asking.

This is where AI tools come into play.

For example, tools like Frase help you create VSEO optimized content by showing you the questions searchers are asking. You can then create content around these questions.

frase ai seo

Another aspect of voice search is that it’s conversational. This is where AI principles like NLP come into play.

AI-powered content tools like Grammarly and Hemmingway can help you create more conversational content by recommending tone changes and highlighting hard to read passages.

One thing to note about VSEO is that it is hyper-competitive. That’s because voice assistants only give one answer – the one right at the top of the SERPs.

This means you have to pull out all the stops to ensure you rank well for VSEO.

Scale Your SEO

A significant part of SEO is tedious manual labor that has made it difficult for marketers to achieve results quickly.

AI has changed that.

AI-powered tools have taken a lot of the grunt work out of SEO by gathering data, analyzing it, and translating it into actionable steps,

More than that, however, you’ll find that artificial intelligence SEO software, like Alli AI, can help with your technical SEO as well. For example, it can help you:

  • Conduct website audits
  • Automatically optimize content
  • Fix duplicate content issues

On the on-page SEO front, AI SEO software can help you scale your content creation by analyzing top-performing content. The software can then help you create content strategies and briefs for optimized content.

As a result, you can quickly scale your SEO efforts — without overworking your team.

AI can take over the laborious, mundane, and time-consuming (and sometimes soul-sucking) aspects of SEO. This will free up your team to do other things that need human attention.

User Experience

Remember – Google’s (and other search engines) primary focus is the user.

This means user experience (UX) is a crucial element of SEO.

That’s probably why, in a rare announcement, Google let people know that page experience will be a significant ranking factor starting from the year 2021.

But what is page experience?

According to Google, page experience is a set of signals that measure a user’s satisfaction (or lack of it) when interacting with a web page. This goes beyond the page’s informational value.

It takes into account the overall UX the page provides.

Of course, pages with negative user experience won’t rank and those that offer users a positive user experience.

Where does AI come into play here?

With search engines thinking more like real human users, they can determine whether your page will provide users a positive UX or not.

This means when a user inputs a search query, search engines want to make sure they serve up:

  • Relevant and authoritative content
  • Pages with proper structure
  • Pages with easy navigation
  • Pages that load fast
  • Mobile-friendly websites

If users can enjoy a personalized experience on your website, this will increase dwell time and encourage sharing your content. Both are signals to search engines that your content is worth ranking higher on SERPs.

Today’s AI-powered SEO tools, like Market Brew, can mimic search engines and give recommendations on what you can do to improve your website’s UX.

As a result, you don’t have to guess whether the SEO gods will smile on your website with favor or not. You can know what pleases them (to a greater degree) and implement that on your website.

Conclusion

Ready or not, the future of SEO is here.

And it’s just two words – artificial intelligence.

By marrying these two disciplines, you can create a robust SEO strategy that’s bound to get you noticed. More than that, it will help you build a loyal audience.

Of course, for every business, that translates to a healthier bottom line.

Have you embraced the power of AI SEO yet?

The post How to Use AI SEO to Improve Your Website appeared first on Neil Patel.

How to Develop a Winning Digital Marketing Strategy in 4 Easy Steps

According to Smart Insights, 45 percent of companies don’t have a clearly defined digital marketing strategy; 17 percent of companies have a digital marketing strategy in place, but it’s separate from their marketing plan. 

This means 62 percent of companies are unprepared. 

They don’t have the strategy, tactics, or tools they need to market their business well. The bad news is that marketers waste 37 to 95 percent of their marketing budget. This is really common, but it doesn’t have to be; if you have the right digital marketing strategy in place, growing your business is easier. 

If you’re feeling unprepared, don’t worry. 

Today we’re going to cover the important ins and outs of creating a winning digital marketing strategy. 

Why You Need a Digital Marketing Strategy

Your digital marketing strategy gives your company direction. With a plan in place, you’ll have the details you need to help your company grow consistently. Your digital strategy document should: 

  1. Define your short and long term goals
  2. Show you who your customers are
  3. Show you where you can find them 
  4. Outline what you need to attract your customer’s attention
  5. Offer a step-by-step plan to attract and hold customer attention
  6. Show you how to analyze and improve marketing performance

Why go to all the trouble? 

Is it worth the time to create a strategy document? CoSchedule’s State of Marketing Strategy Report found winning marketers: 

  • Document their digital marketing strategy. Marketers who document are 538 percent more likely to achieve success than those who don’t.
  • Document their marketing processes. Those that do are 466 percent more likely to achieve success consistently over time than those who don’t.
  • Winning marketers set goals. Goal setters are 429 percent more likely to report success than those who don’t; 81 percent of these marketers achieve their goals; 10 percent of organized marketers always achieve their goals.
  • Winning marketers study their audience. These marketers are 242 percent more likely to conduct audience research four times a year. Almost 60 percent of the elite marketers featured in their study conduct audience research once or more per month.

It seems too good to be true, but it’s actually the reality.

The more time you spend thinking about your goals, getting to know your audience and planning how you’ll approach your digital marketing, the more likely you are to achieve success. 

What Should Be Included In Your Digital Marketing Strategy

I’ve already given you a sneak peek, did you catch it? 

To be successful, your digital marketing strategy should focus on four specific areas. 

  1. Setting goals, objectives, and key performance indicators (KPIs)
  2. Understanding and defining your audience 
  3. Creating and implementing your digital marketing strategy
  4. Auditing and improving your marketing campaigns 

You’ll want to break each of these areas down in enough detail so you (and your team) can work with each of these areas properly. With each of these areas, you should have a pretty clear idea about: 

  • The information, tools, and resources you’ll need to create a plan
  • Who will be responsible for creating your plan
  • Who will be responsible for implementing your plan
  • The KPIs and metrics you’ll use to measure the success (or failure) of your plan
  • The tools and resources you’ll need to implement and improve campaign performance

Each of these points needs to be defined clearly for the four steps areas above. 

Let’s take a closer look at these four areas and break things down a bit more clearly. 

1. Setting Goals, Objectives, and KPIs

This step is all about deciding what you want.. 

Planning your marketing strategy begins with setting quantitative and qualitative goals;  you’ll also want to set KPIs. These goals are sort of like the railroad tracks that keep your digital marketing strategy on the right track. 

What’s the difference between qualitative and quantitative goals?

G2 has a really helpful way of defining these, so I’m going to paraphrase their definition here. 

Quantitative goals can be counted, measured, or displayed using numbers. Goals like increasing monthly recurring revenue by 15 percent or boosting your conversion rate by 3 percent are good examples of quantitative goals.  Qualitative goals are abstract, descriptive, or conceptual — these goals are usually tied to the question “why.” Goals like increasing customer trust or improving brand reputation are examples of qualitative goals. They’re difficult to measure but just as important. 

You’ll want to make sure that your goals are: 

  • Challenging, realistic, and attainable
  • Tied to your company’s mission, vision, and values
  • Concise — 2-3 main goals 3-5 supporting goals
  • Specific, clear, and timely
  • Broken down into smaller, step-by-step milestones 

Your goals are important, but they’re difficult to achieve if you don’t have a step-by-step plan to follow. That’s where milestones come in; milestones are tactical. They’re great because you can use them to move towards your goals quickly. 

What about KPIs? 

Scoro has a list of 136 KPIs you can use to jumpstart your planning. I’ve listed a few of the more common examples you can use below.

  • Unique visitors per day/month
  • Pages per visit
  • New leads per day/month  
  • Marketing qualified leads (MQLs)
  • Conversion rates
  • Churn/attrition rate
  • Cost per conversion
  • Conversion rate per keyword
  • ROI per content
  • Click-through-rate on paid advertising

Focus is really important. 

It’ll be tough to focus on lots of metrics at once. Instead, you’ll want to focus your attention on a small number of really meaningful KPIs and metrics. 

Which ones are meaningful? 

They’re the KPIs that have the biggest impact on your company, the ones that generate consistent returns or a large amount of cash for your company. You’re looking for the 20 percent of KPIs and metrics that produce 80 percent of your results. 

That’s a pretty easy place to start. 

If you’re not sure which KPIs you should focus on, start with the common KPIs and metrics that have a direct impact on your business. These are typically metrics that focus on traffic, conversions, and optimization. 

2. Understanding and Defining Your Audience

You know what your goals and objectives are. Now you need to figure the same things out for your customer. This step requires some upfront research, but the success (or failure) of your digital marketing strategy starts here. 

Think about it. 

If you find the right customers, the people are excited to buy your product, then selling is a whole lot easier. It’s especially easier if you can understand what they want and how you can go about selling to them. So to do that, you’ll need information on your customer’s demographics and psychographics. 

What are you trying to figure out? 

  • The size of your market: You’ll want to figure out some important details about your market —is it new or established, niche or mainstream, broad or specialized. You’ll want to figure out who the major and minor players are, market expectations, areas you can disrupt, and the financial upside in your specific market. 
  • Who your customers are:  Are you targeting new moms, weekend warriors who are active on the weekends? You should have a basic idea of the customer you’re targeting. Are you focusing your attention on a specific niche, i.e., affluent travelers, price-conscious fashion aficionados? Use previous sales, competitor research, and market research sources like Ubersuggest and Google Trends to find the answer. 
  • Where they spend their time: Your customers have specific hangouts. Web developers spend their time on sites like ArsTechnica, Reddit, SitePoint, etc. New moms spend their time on sites like Babble, CafeMom, or Bundoo. If you know where your customers like to spend their time, you have a pretty good idea of the channels to target and the content to use. 
  • What they consume: This overlaps a little bit with where they spend their time. When there is an overlap, you’ll want to break the differences down even further. For example, your customers may spend a lot of time on Reddit, but this doesn’t tell you what they’re consuming on Reddit. Reddit is where they spend their time; the subreddit r/RobinHood is what they consume. See the difference? One tells you about their specific interests and desires; the other focuses on location. 
  • Why they buy: Your customers don’t buy for the same reasons. Sources like online reviews are a great way to get really helpful, in-depth feedback on why customers buy from customers themselves. You can also use tools like surveys or polls to attract responses. You’re not looking for an individual answer; you’re looking for trends. 
  • Where and how they buy: Do customers price shop offline, in your store, then order online from Amazon? Maybe your customers prefer a one-time purchase over recurring payment options? If you understand when and how your customers buy, you’ll be able to adjust your marketing around their expectations. Maybe that means persuading customers to do something different or stick with market expectations. 
  • What they need to buy: Online reviews are a helpful tool here as well. If you’re a new business, you can start with competitor reviews. Go through your competitor reviews, then make a list of the concerns brought up in each review. Look for customer objections, technology issues, complaints, reputation issues, any problem that customers felt were deal breakers. If you have reviews of your own, you can do the same thing there. 

Remember the research I shared earlier? 

Elite marketers study their audience, conducting audience research once or more per month. This step is important because it gives you the instructions you need to create a winning digital marketing strategy. Audience research shows you how to persuade your customers. 

This isn’t rocket science. 

But it requires more effort than most companies are willing to give. 

Here’s why. 

Most companies assume they already know their customers. They believe they know what their customers want and the best ways to approach them. 

They may be right. 

But the data they have on their customers changes often. Consistent research is the only way to stay on top of what your customers actually want. At this point, you’re ready for step three. 

3. Creating and implementing your digital marketing strategy

If you’ve done your homework, you should have the building blocks you need to create a well defined digital marketing strategy. You should be able to identify the marketing channels that will work best for your business. There are lots of digital marketing channels you can choose from. 

You can focus on: 

  • Content marketing
  • SEO
  • PPC
  • Display advertising
  • Email 
  • Online video
  • TV commercials
  • Mobile ads
  • Channel partnerships
  • Events 
  • Social media advertising 
  • Podcasts and radio advertising
  • Print advertising

In fact, there are more than 51 different marketing channels you can use to promote your business. Which one are you supposed to use? 

There are a few ways you can approach this. 

  1. Investing in the channels your customers use (e.g., search, social media) 
  2. Investing in the channels that give you independence and control (e.g., email, partnerships)
  3. Investing in the channels that are most common/popular (e.g., SEO, PPC, Social media) 

Start by testing the channels where there’s more overlap. 

If your customers use popular channels like Google search or Facebook, those are great places to start. If you’re looking for a channel that gives you maximum control and works well with other channels (i.e., email), you can start there. 

Don’t forget to test. 

Testing shows you what works. The tools you use for testing tend to be consistent with the channel (e.g., email comes with analytics. Google offers Google Analytics, etc.). Typically, you can branch out once you’ve identified the marketing channels that perform best for your business. 

You’re looking for stability. 

You want to get two to three channels working well before you decide to add more. Once you’ve identified your channels, use the data you’ve collected in step two to create the kind of marketing content that fits well with the customers you’ve identified.

Your content should: 

  • Attract their attention
  • Be fascinating 
  • Discuss a problem or challenge
  • Offer a solution to the problem or challenge you’ve just identified

Here’s another important detail. The research you’ve done should help you create a strong value proposition that answers the “why me?” question. Your value proposition is basically a promise. It’s the most important part of your marketing copy. 

It gives your customers a persuasive reason to do business with you. 

Your value proposition sets you apart from the competition. It gives your business an unfair advantage, and it gives you the opening you need to attract more customers, increase customer loyalty, command higher prices,  and beat your competitors. 

Here’s a detailed breakdown if you need help creating your own value proposition. 

If you’ve followed the steps I’ve mentioned above, you should have the information you need to create amazing content that draws customers in. 

4. Auditing and improving your marketing campaigns 

If you can’t measure your marketing, you can’t improve them. Part of the reason marketers waste 37 to 95 percent of their marketing budget is the lack of measurement.  Forrester’s research stated that between 60 – 73 percent of a company’s analytics data goes unused. 

Companies don’t know how to work with their data. 

  • They don’t know which problems to fix
  • They don’t know what they have 
  • They can’t see the value of their data
  • They don’t know how to evaluate or analyze their data
  • Their data isn’t available to analysts who can use it 
  • There’s too much data to go through and not enough people or time to use it

The other three steps aren’t all that helpful if you can’t see your marketing results. If you’re going to create a successful digital marketing strategy, you’ll need a plan that helps you to capture, report, and analyze the data. 

You’ll need analysts who can use your data to solve problems. 

That’s part of the problem. 

Most companies don’t have the people or processes in place to handle this. This is why it’s so important for businesses to get help. It’s too much for most companies to handle on their own — small, medium, and large companies all struggle with these issues. 

If this is the case for your organization, it may be a good idea to get help from an agency. 

You should be able to plan, implement, and optimize your digital marketing strategy.  If you can’t, it’s a good idea to get help with all or part of the process. 

Conclusion

Almost half of companies don’t have a clearly defined digital marketing strategy in place. A smaller segment of respondents haven’t connected their strategy and their marketing. Most companies are unprepared; they’re not ready to handle the requirements that come with creating their digital marketing strategy. 

If you’re feeling unprepared, don’t worry; use the information we’ve discussed as a guide. If you’re aware of the ins and outs of planning, you can create a winning digital marketing strategy in four easy steps.  

The post How to Develop a Winning Digital Marketing Strategy in 4 Easy Steps appeared first on Neil Patel.