16 Mistakes To Avoid If You Want Your Startup To Succeed
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16 Mistakes To Avoid If You Want Your Startup To Succeed
The majority of the businesses that are newly established tend to fail within one or two years of operation. About half of all businesses hardly survive past the fifth year. Therefore, how do you launch your startup?
Initiating a business idea requires time, hard work, commitment, funding, and effort. You must be ready to make plans, conduct market research, make financial decisions and obtain adequate knowledge in the necessary areas.
We have compiled the 16 most common startup mistakes that have been emphasized by small business experts over time. With this guide, you can avoid early-stage pitfalls and potential consequences as an entrepreneur.
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Most Common Startup Mistakes
1. Lack of the business’ weakness awareness
Hate to break it to you, but passion and dreams are not enough to run a business successfully.
It is important you recognize the loose ends surrounding and existing in your business, to steer your business in the right direction.
Whatever you do, do not make a decision that affects your business without performing a SWOT analysis. SWOT stands for your business’ Strengths, Weaknesses, Opportunities and Threats.
Your weakness is particularly important because it can crumble your business from within. Your business’ weaknesses are characteristics that place the business at a disadvantage relative to others.
Weaknesses could include insufficient capital, skilled workers, the complexity of supply-chain, cash flow issues, and so on.
When you identify these weaknesses, you can then create systems around them that ensure your business is not limited by it in the long haul.
2. Lack of proper target audience understanding
A constant startup mistake is a misunderstanding or not being aware of the target audience. You can’t sell to people you don’t truly know.
The target audience is misunderstood in the sense that many businesses focus on a market that’s usually too small to build a business in. On the other hand, a lack of awareness about the existing market is worse.
There is no way to know that your business is starting or running on the right track if you don’t get consistent feedback from current and prospective customers. Designing a great product or service does not frequently lead to a successful business.
So, make sure to gather sufficient data points on the market and the target audience. How? Understand the market trends, the demands of customers, their pain points, and expectations.
Then, use the data to build out a buyer persona.
3. Using only convenient or popular marketing channels
Marketing is as important to any business as oxygen is to humans. However, you need to be strategic with marketing. Otherwise, you will waste a lot of money and time.
Choosing a marketing channel should be dependent on what works for your audience and not just what is convenient or in trend. It’s okay to try out popular channels but make sure to look into the data to ensure you’re getting a deserving ROI.
For instance, Tiktok marketing might not work great for a B2B software product like it would for a beauty business. On the other hand, LinkedIn and SEO Content marketing will work great for a B2B business and not so good for a beauty business.
It all boils down to your target audience and where they hang out the most, as well as the complexity of your product.
You can also adopt a multi-channel marketing approach. This will allow you to market to your audience at every stage of the buyer’s journey.
For instance, Social Media Marketing is great for the awareness stage while an SEO content comparing you with other competitors would be great to catch your target audience at the consideration stage of the buyer’s journey.
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4. Overspending and underspending
As a business owner, you must be intentional about the cash flow of your business. Meanwhile, spend your money wisely, but do not lose out on investing in good people and quality products.
You should have enough money to live on, during the early stage of your business. Factor in the unknowns, challenges and delays that could occur along the way. Do not fuel your positivity to the point where it harms your business. Secure actual funding and not only promises.
Starting a business without having money saved up somewhere is a grave startup mistake. Some of the ways to avert this mistake are to;
- know your buyer’s journey.
- align your budget with your marketing goals.
- evade hidden costs
- remember where your priorities lie.
- spend your budget smartly.
- prepare to measure ROI
- implement a thorough record-keeping process
5. The mistake of not building a community of target audience
You will not get far with a product that doesn’t have a group of people behind it.
If you actually sell a product or service that solves a specific problem for people, then your target audience will share a lot in common. It could be in the problem they are trying to solve, their values or beliefs. Building a community around these shared attributes is a way to guarantee your startup success.
Here are some reasons you should consider building a community around your products or services:
- It ensures you are providing value based on your audience actual needs
- It provides social proof
- It help you bond with your audience, hence making selling to them a lot easier
- You will build out an army of loyal customers who become advocates for your small business
One of the best ways to build a community of people is to allow emotions to play a role. For example, if your product or service is a solution to a health problem, you can rally a community behind your startup using the emotions connected with the issue your solution betters, or solves.
This makes personalizing your message vital. Users trust recommendations from people they know, rather than brands. Why? Because there is a personal connection, keep this in mind when building your community. Your business will have a far more eager audience after launch if you employ emotion and personalization.
6.Creating crappy website
Today, your website is your storefront. The website experience is important to customer acquisition.
Your website should be about your business but also about your customers and what they want or need from you. Viewing your website in this light will help you avoid mistakes that could hurt customer experience on your website and ultimately lose sales.
Some of the mistakes many brands make that you should avoid include:
- Choosing the wrong domain name
If your brand name is different from your domain name, then it creates room for skepticism. And you might find it harder to convince your clients that they are the same.
Your brand identity starts with choosing the right brand name. You can generate creative brand names for all types of businesses using this brand name generator.
- Not putting thoughts into quality of user experience
UX starts from the content on your site, to the type of site you use, to the speed of your site and how it loads.
- Using annoying forms and pop-ups
If you want to generate leads with forms, make sure the offer is very valuable. And ensure not to obstruct users in achieving their aim on your website with irrelevant pop-ups.
- Helping users leave their site
Setting up external links to open in new tabs is a simple way to improve user experience and ensure you don’t take visitors away from your site before they convert.
- Not keeping tabs on website performance
You can’t improve what you can’t tell what’s wrong with it. Set up analytics to collect data on how visitors use your website, so as to improve its performance.
- Not generating traffic to website
It’s safe to say a website without targeted traffic is wasting away. Generate traffic to your site with Content Marketing using SEO and social media.
It is also important to not fall into the trap of trying to make your website more stylish or fancy than it should be. Some businesses make the mistake of overloading their site with information that doesn’t help people find what they’re looking for. What’s important is providing value to your target audience.
7. Lack of content planning
Content is king. Content should be planned for various stages of the buyer’s journey.
Not having a clear content roadmap means you’re likely to end up with a mess of inconsistent, unlinked or disorganized content across your site and social pages.
This will not only hurt your brand but also denies you access to quality traffic that should have come from SEO and social media.
Good website content also helps your site rank higher in search engines, which can increase your conversion rates. Also, when you create content on your website and plan for its distribution across social platforms, it brings more traffic than when you just create without distribution.
Whether you’re an online retailer or a service provider, the quality of your content can make or break your site. When users visit your site and they do not find your content valuable, they leave without wasting time. This bad user experience impacts your website ranking subsequently as the Google algorithm takes note.
So when you’re creating your content, you should always be thinking about what’s going to drive traffic back to your site. Without this focus, you’ll end up with too much generic content that doesn’t add any value or even worse — no content at all.
8. Launching or Expanding too quickly
A startup mistake that many business owners make is launching their business before the product is completely ready. Bringing in an unfinished product that you don’t have sufficient knowledge of or that has not been satisfactorily tested and verified can implicate the credibility and authority of the startup.
Before you launch, confirm that everything is in place (i.e.your payment processes, marketing strategy, contracts, communications). If you do not put the back-end of your startup in a great position, the cracks will start to show when you take on clients. It could also backfire on your startup, and push away ideal consumers and the conversion rates.
Take your time and ensure the product goes through a meticulous quality test and development process. Then, launch it into the market with adopted strategic procedures. Find the right market for your startup’s product to maximize sales. Do not rush any of the steps.
Subsequently, the success of your business after launching does not imply that growth will continue steadily. Expanding too hastily could lure dire impacts. You may realize that the growth was only temporary, and it would be too late to reverse your decision. This is why it is vital to apply a slow and steady strategy to expansion and never act erratically in the spur of good results.
9. Competing on price only
Competing on price is a common startup mistake that usually stems from the fear of competition. It is not sustainable.
Having a fair idea about the competition in the specific market or field is good. Regardless, worrying about it too much can lead to unwarranted distraction. It can make you paranoid and shift you from your principal goal as a business owner.
There is a difference between designing a competitive product/service and being obsessed with competition. The primary reason you should be focused on the competition is to make wise decisions about your project. Understand that other competitors encounter the same fears and concerns as you and try to relieve yourself of such stress.
So, instead of competing on price, identify areas or markets where your competitors are not adding value and double down on it. Infact, your competitive advantage could be in your impeccable customer experience.
10. Not taking customer experience seriously
Usually, this mostly happens in two ways. The first one is not prioritizing customers’ requirements. Not including customer service in your business plan can lead to disastrous outcomes.
Funding your business is crucial, but doing that at the expense of the latter is one hell of a bad start. Just because you have a great business idea does not mean that you’ll get funding. Let there be a balance between forming a pitch and forming a business.
What you should do is create a business model that ensures the product pays for itself. Find customers that will pay for your product. When you have them, the investment will become easier. Concentrate on the things that you can control, which include providing an awesome service or product and attracting customers, instead of the things you cannot control.
The second one is assuming you know what’s best for your customers. Not paying attention to feedback from customers constrains the progress of your startup. You cannot improve on your customer experience without collecting feedback from them. Be obsessed with hearing from your customers.
11. Refusing to delegate tasks
Business owners find it easy to believe that they are all alone and try to handle everything themselves without advice or help from anyone around them. Other times, they feel like they are the only ones who understand the product best, and no one would be able to do things the way they would. At the beginning of your business, that may be unavoidable. But, you should not make it permanent. Set the tone of your business’ culture right.
Hire reliable and competent hands to help your business grow. Ensure that they share your vision and want the best for your business too. Harness the power of delegation, so that fewer mistakes will emerge.
12. Undervaluing your products and services
When starting your business, there is a tendency for you to want to undermine your products/services. When you succumb to your lack of confidence or fear of failure and drive their values low, it can lead to frustration, regret or resentment.
The key to avoiding this mistake is studying the market properly before adopting specific pricing criteria. It takes time for a startup to recover from a bad pricing strategy. The right price entry point gives you a healthy margin.
Having a strong profit margin is fundamental to the success of your startup. Fixing it too low will make things more difficult for you in the future. For instance, your customers will not be thrilled by a price raise later on.
Observe your production and operating costs, and determine how flexible it is. Examine if you can reduce these costs in the future when the situation calls for it. If it’s not possible, choose a greater profit margin quickly to adjust to these costs.
13. Launching and running without a marketing plan
Marketing is significant for sharing your products/services with your targeted audience in a strategic manner. It also attracts potential customers to your business.
Validating the problem, market and idea for your startup are not enough. You need a comprehensive marketing strategy that entails acquiring users, converting those users into paying customers and making those customers excited for your product, retaining them and bringing more customers to your business.
It is particularly important to your business success that you have a strategy in place for retaining existing customers and selling to them again and again. This is because it is a lot easier and cheaper to sell to those who have already bought from you and trust your service than entirely new people. It’s an ingredient for long-term startup success.
14. Failure to prioritize
Poor organization can negatively influence your focus and the way you manage your business. It restricts the potential of your business.
Prepare a reasonable schedule that can help you organize business activities. This will gradually set your priorities and guide you against clashes and complexities later.
Business owners are always pressed for time. They get caught up in multiple obstacles, and managing time becomes literally impossible. In the end, it is all about setting your priorities right.
Set your desired goals and match the tasks to these goals, you’d discern what to prioritize. Break your long-term goals into small, distinct ones and try achieving them in a stipulated time. This will help you manage your time better.
15. Having no sense of purpose
Your business idea should have clarity. This is the inception of any business, yet it is often disregarded. Several business owners go on with their grand business plans without reflecting on why they are doing what they do or calculating the extent of change they want to see with such business.
A startup with no purpose will not possess momentum. It only has surface value. When things get tough, you and your team won’t have much to pull through. A clear sense of purpose gives your business originality, an actual meaning and a reason for being.
For a start, educate your early customers about what your business does. Invoke an emotion in them. The dominant factor of a customer’s purchasing power is usually emotion and not logic.
Appealing to everyone and adding features from all angles will lessen the worth of your product and what your business stands for. Pick one thing, specialize in it and do it well.
It will not be easy, especially when there are pressures from customers, investors and your team members. Still, learning to reject things is important if you want to protect the usability of your product.
A trick to achieve this is by stating the things your business does not exist for. It promotes the development process of the business. This way, you and those affected can make proper decisions without losing sight of what is relevant.
16. Being risk-avert
Prioritizing stability because you do not want your business to get out of its comfort zone is not advisable for the future of your startup. Small business experts have pointed out that many businesses prefer to establish their position in a smaller crowd, so the competition is not as fierce.
The truth is you cannot know how good your product is if you choose to think too small. It’s like Paul Graham said, “if you make anything good, you’re going to have competitors, so you might as well face that.”
Rather than spreading yourself too thin, nurture your mindset and be responsive to the changes in market conditions.
A business plan is great but when you launch, do not hesitate to adjust when need be.
Conclusion
Although there are numerous startup mistakes you will want to avoid as a business owner, you must understand that some mistakes are inevitable. Therefore, manage your expectations accordingly.
The good news is that if you prudently follow this guide, you will hugely increase the chances of your business succeeding.
The majority of the businesses that are newly established tend to fail within one or two years of operation. About half of all businesses hardly survive past the fifth year. Therefore, how do you launch your startup?
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