Lured by the prospect of being your own boss and achieving financial independence, you’ve disavowed the 9-to-5 and pledged to start your own business.

You’ve spent the last few months mulling over business ideas — your family and friends have heard your idea for a new productivity app at least 20 times — but you’ve reached a point of “analysis paralysis” and don’t know which idea to test-drive first.

In addition to reading startup success stories, which are plentiful, consider educating yourself on the factors that lead to startup failure.

Failory’s Startup Cemetery is a collection of case studies eulogizing 120+ startups that have shut down for various reasons, including the pandemic, being too slow to adapt to changing market demands (we’re looking at you, Vine!) and monetization problems.

Morbidity aside, there is an abundance of untapped markets out there that you can target for profit.

According to Statista, in 2022 ecommerce revenue will reach $875.2 billion in the U.S. alone, possibly surpassing $1,300 billion by 2025.

We’ve developed a list of business ideas with the most promising potential to get you started.

Why Start an Ecommerce Business?

Starting an ecommerce business allows you to reach a virtually limitless audience while forgoing the costs of acquiring physical premises. Certain business models don’t require purchasing equipment, holding inventory or even producing items yourself.

Advantages to starting an ecommerce business.

The proliferation of ecommerce platforms and tools — from website builders to marketing automation and SEO tools — has made it easier than ever for bootstrappers to start a business in record time.

You can create your own ecommerce website or sell items on existing marketplaces including eBay, Amazon or Etsy using your own ecommerce storefront which you license from a provider.

Location independence

Unlike a brick-and-mortar store, an ecommerce business can serve a virtually limitless global audience if you provide overseas shipping. This also means that you can run your business from anywhere and be a digital nomad as long as you have a laptop and reliable internet access.

You can travel indefinitely, move abroad or move to a more affordable location. Ecommerce businesses are also much easier to scale because you don’t need to expand physical premises.

Flexible work schedule

Once you get your business up and running, you can choose your own hours. Time is a precious commodity when you’re a small business owner.

Aside from spending time running your business, optimizing your website, fulfilling orders and marketing your business, make time for other high-value items like networking, building skills, interacting with employees and leisure.

Finally, use delegation and automation to the fullest extent — especially for repeatable processes or tasks you can outsource to skilled professionals. You can run your business with a cofounder, a lean team or even alone without clocking in 12-hour shifts.

Disadvantages of starting an ecommerce business.

That said, there are drawbacks associated with running a business online.

Fragility

Ecommerce businesses are less resilient than other types of businesses because many moving pieces are prone to disruption. Shipping delays, product recalls and supply chain disruptions can preclude order fulfillment.

If you sell via an online marketplace rather than your own ecommerce website, you are at the mercy of the marketplace’s algorithm. To optimize product discoverability, you must adhere to the platform’s rules, requirements and SEO tools.

Competition

Ecommerce businesses face intense competition from other SMBs and ecommerce giants such as Amazon. Differentiating from the competition and meeting customer expectations can be challenging.

Also, the convenience of online shopping makes it extremely easy for customers to switch between different brands and comparison-shop online, so you can easily lose a sale to a competitor just because you don’t offer free shipping or because their identical product costs $1 less.

20 Best Ecommerce Business Ideas

Now that you’re clear on the stakes of starting an ecommerce business, here are some business ideas to get you inspired.

Do your research to find out what products are in high demand. Google Trends shows search engine queries customers use when shopping online. Another way to find profitable ecommerce business ideas is to follow influencers and bloggers who work with your competitors.

Our team did some research and cross-checked different online business ideas based on:

• Demand.

• Market saturation.

• Execution difficulty.

• Growth prospects.

And then we grouped all of them into the following categories:

• Apparel.

• Health and beauty.

• Dropshipping.

• Reselling products.

• Digital downloads.

• CBD and more.

1. Create a niche apparel product.

A clothing business can be a great way to turn your skills and creativity into a career. You can sell niche, custom-made apparel products that play to your strengths.

If you’re a visual artist, you might create art that can be printed on t-shirts or other clothing items. Or if you are passionate about costume design, you might create and sell costumes for Halloween and theater productions.

When it comes to selling apparel, you have several options:

• Buy products from wholesalers.

• Design your own apparel and have them manufactured, then sell your clothing line wholesale to other retailers or via your website.

• Design and sew your own items in-house.

• Design repeating patterns or graphics to print on blank t-shirts and other clothing items using a print-on-demand model.

Perhaps your strength is curating clothing items, not so much pattern grading, sewing and draping. In that case, you can build collections by purchasing from wholesalers or drop shippers.

However, this means your products aren’t as unique.

Apparel remains a growing industry. In 2020, the global apparel market generated approximately $1.46 trillion in revenue. And it’s predicted to grow to roughly $2.25 trillion by 2025.

2. Sell industrial B2B products with little competition.

B2B products are goods, services and solutions other companies buy for direct usage or to create other goods. For example, industrial products like heavy machinery do not become part of the finished product but assist in the business operation.

Since a major part of B2B selling is educating consumers and tailoring solutions to business requirements, technical knowledge is essential.

Say you’re familiar with heavy machinery from working at a manufacturing plant. You might sell capital items — industrial assets that support production and other general activities — office equipment, or accessory equipment (ex: machine tools, conveyor systems, pumps, overhead cranes).

You can also sell raw materials (industrial goods that will be processed to produce other goods — such as agricultural or farm products), manufactured materials or component parts (tires, ball bearings, switches).

3. Do what Amazon can’t.

Offer your customers a personalized, high-quality selection of niche products. Customers will shop on Amazon if your products are available there because it’s a trusted brand, so differentiation is key.

Target a specific buyer with a specialty product

For example, wine connoisseurs are willing to pay a premium for aged wines because they value a specialty product. Consumers who care about sustainable fashion want to buy long-lasting apparel from businesses that use ethically sourced materials.

When you offer a specific product line, you save money, become more productive and can better articulate your value proposition to prospective customers.

According to Harvard Business Review, large markets can evolve from niche ones.

Provide a personal touch

For example, if you sell custom clothing, let customers submit or create their own designs. Most Amazon products are off-the-shelf with no customization options.

4. Provide AR/VR equipment.

If you’re computer-savvy or an avid gamer, you can rent out AR/VR equipment for specific functions such as birthday parties and corporate events. You can also rent a space to create a VR experience for people, such as a VR escape room, and charge admission.

If you can acquire physical premises in a high-traffic location, you can also rent it out for VR events for public fundraisers or private parties. If you’re a skilled programmer versed in 3D animation, you can even start a VR content creation business to help brands design and implement immersive AR/VR experiences.

The booming gaming industry and the advent of the Metaverse are fueling the growth of the VR/AR market, which was valued at $14.84 billion in 2020 and is projected to reach $454.73 billion by 2030.

5. Dropshipping.

Dropshipping is one of the least expensive ways to start an ecommerce business. Sellers partner with suppliers — a manufacturer, another retailer or wholesaler — and set up an ecommerce website to sell the supplier’s products.

When an order is received, the supplier automatically fulfills the order. The best part? You never need to handle products or stock inventory. In other words, you set up a shopfront and market products on behalf of another business, acting as the middleman.

You can find dropshipping suppliers through a supplier database like Alibaba or AliExpress, or through an integrated supplier directory in your ecommerce software.

While startup costs are low (your only expenses are incorporation fees and the cost of registering a domain for your website), you will face intense competition from businesses selling a similar product at the same price.

According to the latest data, the global dropshipping market is forecast to reach $196.78 billion in 2022, a whopping 23.7 percent year-over-year increase from 2021.

6. Sell toys online.

Toys aren’t just for kids, especially when it comes to collector’s items. You can sell a broad range of children’s and hobby-related toys, including new and used toys.

For example, you can tout traditional toys, action figures, video games, board games, hobby kits, LEGOs and craft supplies.

Toy sales mostly entail marketing to parents, so keep this in mind when you’re designing your own website and writing product descriptions. Use lots of HD images on your website and be sure to answer parent’s questions in your product descriptions, such as:

• What ages is the toy safe for? Are there any smaller parts that could be a choking haard?

• What parts are included?

• What materials is the toy made from?

• Are batteries included?

Finally, keep an eye on regulations and product recalls for defective or dangerous toys. Toy brands must pay attention to government regulations that designate safety standards for the industry.

The global toys market size is projected to reach $230.64 billion by 2028, exhibiting a 7.30% CAGR during the forecast period. Rising demand for toys that boost mental training such as Rubik cubes, educational boards, wordplay games, and others is expected to boost demand.

7. Start a CBD business.

CBD products including oils, ingestibles and ointments carry a variety of wellness and therapeutic benefits. Note that there are different product types based on the consumption method.

For example, drops and sprays, pills and capsules, vapes and cartridges, tinctures, edibles and topicals. Start by finding your ecommerce niche, such as CBD-infused food or CBD pet products. Be prepared to educate consumers about the general benefits of CBD and the specific compositions of each product.

Write detailed product descriptions, tell a story that addresses the consumer’s pain point, and offer instant messaging or web chat so customers can ask product questions directly. However, beware of regulations in certain regions that may throw up additional hurdles.

CBD stores can be highly profitable, with data showing that retailers see net profit margins of above 40%. The industry is expected to reach $20 billion market value by 2024.

8. Consider print-on-demand.

Aside from apparel, you can sell other on-demand products such as home decor, stationery, accessories and more.

Print-on-demand is a type of dropshipping. It’s a low-risk way to sell custom products because you don’t have to stock inventory or invest in equipment.

Instead, you partner with a supplier of white-label products to customize those products and sell them on a per-order basis under your own brand with your own designs. Everything from digital printing to order fulfillment and shipping is handled by your supplier.

The global print-on-demand market size was estimated at $4.90 billion in 2021 and is expected to reach $6.17 billion in 2022.

9. Sell a beauty subscription box.

Package beauty products together into a bundled box and sell them for a subscription fee. Skincare and cosmetics are perfect for this business model since they must be replenished periodically.

However, some entrepreneurs have done this with clothing or wellness items that require the touch of a knowledgeable curator or stylist.

Subscription boxes provide predictable, recurring revenue. You can offer tiered pricing for versions of each box with varying levels of value. This business model is all about product kitting, so you must have a penchant for curation.

Though it varies greatly by industry, most subscription boxes have a profit margin of 40-60%.

10. Rent or resell fashion.

Recommerce is the art of reselling secondhand items. Again, it’s all about curation here. Customers will rely on you because you can source amazing finds, saving them the trouble of scouring Craigslist and dealing with potentially disreputable sellers.

The key is to choose a niche, such as vintage clothing or mid-century modern home goods. You can sell on digital marketplaces like eBay or Facebook Marketplaces or set up your own online store.

Some entrepreneurs also specialize in upcycling — taking thrift, vintage or luxury items and converting them into new products.

Recommerce currently represents a $73 billion market in fashion alone (3.5% of the global fashion market) and is projected to grow to $700 billion by 2030 (23% of the market) – 10 times faster than standard retail.

11. Sell online courses.

Online courses provide a revenue stream for passive income. Choose the topic carefully. Your course should help people realize a specific goal, such as learning a new programming language, switching careers or public speaking.

Selling online courses hinges on your credibility as an instructor, so choose a topic within your area of expertise.

Once you create the course, most of your work will be marketing and selling it. Having a strong presence online, an engaged social network or email list are big advantages. You can also sell courses on established learning platforms..

The eLearning market is expected to exceed $325 billion by 2025, with a yearly growth of 5%.

12. Create handmade goods.

Customers value handmade goods because no two are exactly alike. This type of business lets you exercise your creativity. However, beware that it may be difficult to outsource this type of work if/when you want to scale your business unless you can work with skilled artisans you trust.

Ideas for handmade goods include greeting cards, clothing and accessories, beaded jewelry, ceramics, scented candles, organic toiletries, paintings or prints, cross-stitch or knitted items and plush toys.

The global handicrafts market reached $680 billion in 2021. Looking forward, this market is expected to reach $1,252 billion by 2027, exhibiting a CAGR of 10.41% from 2022-2027.

13. Pursue eco-friendly products.

Find out how to source eco-friendly versions of existing products. Remember, “eco-friendly” can mean many different things, from using recyclable or biodegradable packaging to replacing single-use products to using less energy.

For example, you might focus on eco-friendly kitchen appliances such as induction stoves, which consume less electricity than an electric stove. Other examples include clothes made from recycled fabric, cloth shopping bags, cleaning products free from harmful chemicals, solar-powered electronic devices and products designed to curb water use.

A recent study showed that 85% of consumers have become “greener” in their purchase behavior in recent years. In fact, 61% of U.S. consumers say sustainability is an important purchase criterion.

14. Hop on the health and fitness train.

If you’re a personal trainer or nutritionist, you can monetize your knowledge by selling courses, tutorials or e-books, providing on-demand coaching sessions and monetizing your content on social media platforms such as YouTube and Instagram.

You can also sell wellness products such as supplements, exercise equipment and digital products such as workout routines and meal plans. Another option is to offer a mix of online and offline services if you have the capital to purchase a physical space and a larger enough total addressable market (TAM) in your local area.

The pandemic overhauled the fitness industry, increasing reliance on online fitness. In 2021, the market size of the gym, health and fitness club industry in the United States was estimated at over $35 billion U.S. dollars. The sector was forecast to reach almost $36.6 billion in 2022.

15. Offer smart home products.

You can sell products such as smart speakers, doorbells and thermostats while providing installation services to help people connect different smart devices in their homes. Smart home devices automate mundane tasks and empower users to control appliances remotely.

According to MediaPost, 69% of households in the U.S. have at least one smart device, while 12% of those (about 22 million homes) have several.

16. Grocery ecommerce is growing.

According to research from McKinsey, grocery ecommerce is the top COVID-era trend that is likely to be permanent. People increasingly recognize the convenience of skipping long checkout lines and navigating labyrinthine grocery aisles and opt to shop online instead.

Running an online grocery business means setting up a marketplace for food vendors to sell their items. You have several business models to choose from:

• Site-to-store pickup: If you run a physical storefront, you can encourage your customers to order online and pick up in-store or through curbside pickup.

• Direct delivery: Work with a shipping and logistics provider to delivery grocery items directly to customers’ doors.

• Local food delivery services: Partner with local businesses to deliver fresh items to customers.

• Micro-fulfillment centers: Run a small, automated warehouse center to fulfill grocery orders on-demand.

A study from Mercatus predicts that grocery ecommerce sales will surpass 20% of the total U.S. grocery market in 2026.

16. Become an affiliate marketer.

Affiliate marketers are influencers who promote an affiliate's products or services to their existing web or social media audience. If you run a high-traffic blog or you’re an established authority on a certain topic, you start making money by writing blog posts, running ads, sending newsletters, recording podcasts and posting videos on social media.

You can generate income by promoting an affiliate’s product within your content. When someone clicks on an affiliate link and makes a purchase, you earn a commission (a percentage of the order value or a fixed amount). This can be a wonderful source of passive income.

To become an affiliate marketer, you need to have a certain amount of traffic or subscribers/followers. Sign up to an affiliate network to review offers from affiliates and select the ones in your niche. Carefully review the program overview, which includes the types of products and services, payment methods, and commissions.

Affiliate programs are the top customer acquisition channel for 40% of U.S. merchants. Affiliate marketing is estimated to be worth $12 billion globally.

17. Provide home security products.

The home security market is constantly growing as new technologies emerge to enable homeowners to remotely control smart devices and keep their homes secure from intrusion.

Home security products include security cameras, theft detectors, home security systems, smartphone controlled doorbells, baby monitors, alarm systems, smart locks and facial recognition light bulbs.

The home security system market size is expected to grow by $1.53 billion from 2021 to 2026 at a CAGR of 7.8% as per the latest market research report by Technavio.

18. Pet products and food.

From organic pet treats to handmade toys, custom clothing and accessories, there is no shortage of pet products you can sell profitably.

If you can acquire physical premises or cater to people in your local area, you can provide services like doggy daycare, dog walking, pet massage therapy, animal boarding, pet sitting and grooming services.

Pet foods and treats takes the largest share of the pet industry, valued at $50 billion, closely followed by vet care and product sales at $34.3 billion.

19. Wedding goods and services.

Help couples prepare for their big day by selling customizable, handwritten wedding invitations or custom WordPress templates for wedding websites and email invitations. You can also provide day-of services such as wedding and engagement photography and officiation (if you are a certified officiant).

Or, you can refurbish and rent out a vacant barn or gazebo on your property as a wedding venue if you are fortunate enough to have spacious grounds.

With inflation eroding spending power, many couples are taking a low-budget approach to wedding planning. This creates opportunities for businesses to offer one-off services or low-budget venue options as an affordable alternative to hiring a big-budget wedding planner.

20. Recommerce/Second-Hand Products.

Choose a niche you’re passionate about. Maybe you love collecting antiques, finding and rehabilitating incredible furniture pieces on Facebook Marketplace or repurposing recyclables into new products. You can also source items from thrift stores or other online marketplaces and resell them for a profit.

Second-hand products appeal to thrift shoppers and eco-conscious shoppers who wish to promote a circular economy, so tailor your marketing accordingly. 

According to ThredUp’s 2020 Fashion Resale Market Analysis, the recommerce market is expected to hit $64 billion by 2024 up from $28 billion in 2020.

You Have an Ecommerce Business Idea… Now What?

Ideating is only step one of starting an ecommerce business. The next step is determining what products you’ll sell and how you’ll attract new customers.

Determine the who and why for your business idea.

Identify a niche, know your consumers, understand their motivations for purchasing your products and choose products that cater to their tastes.

Remember, the best way to differentiate your online business is to offer high-quality products with a clear value proposition and target audience.

Search for similar business idea solutions.

Before latching on to a single idea, brainstorm similar business ideas which you can combine or refine. For example, in addition to selling secondhand clothing, you may provide print-on-demand items or customization options for customers who want more unique apparel.

Finally, observe what your competitors are doing. If your products are indistinguishable from those offered at other ecommerce stores or major retailers, your business won’t survive.

Talk to your potential customers.

Discover untapped markets by talking to potential buyers. What are some pain points they experience when purchasing from other ecommerce stores or major retailers? What types of products do they have trouble sourcing online? Why might they choose to purchase from a small business rather than Amazon?

Lock down the details of your business.

Once you’ve defined a niche market, researched your customer base and decided on a business idea, the next step is to define your brand. Having a strong brand is key to differentiating your online business.

Next, identify suppliers to partner with who meet your standards and offer the product selections you’re looking for. Writing a business plan is an excellent method for consolidating your business idea and setting standards for things like branding, selecting suppliers, and articulating your value proposition.

The Final Word

Running an ecommerce business is an exciting opportunity to turn a passion into profits, be your own boss and enjoy location independence. Choosing the right business opportunities and identifying a target market is key to ensuring the success of your online store.

FAQs About Ecommerce Business Ideas