Even though businesses that exist solely on the internet can be very successful, they also pose some special challenges not faced by traditional brick-and-mortar businesses. Entrepreneurs who choose to start online businesses should be aware of these special challenges, and in this article I’ll present an overview of some of the most common mistakes they make.
Not Having a Plan
A business without a secure plan is a business that’s doomed to failure. You must know everything there is to know about the business you’re creating, and you must know everything there is to know about the market environment before you open a business. That includes knowing what product you’re going to sell or what service you’re going to provide, knowing whom your customers will be, and knowing how much your customers are willing to pay for your product or service.
Not Worrying About Money
No business can succeed without money. Yes, it’s expected that a brand new business will suck up a lot of your money, and it can take time to start turning a profit, but you absolutely must know how your money is being spent during that time. Know how much cash you have available to you, and know how long that cash will last. Create a financial plan, one that sets milestones related to your business revenue goals, and estimate how much money will be required to reach those milestones.
Undervaluing Your Product or Service
It’s very tempting to sell your product or service for the lowest price in the market. While this might generate sales, it’s pointless if you’re losing money on it, rather than making a profit. First, figure out what the market value of your product or service is, and then try to aim for a reasonable price based on that.
Giving Too Much Away Without Getting Anything in Return
This is closely associated with the previous mistake. Giving away free stuff seems like a great idea to draw in new customers, and it can be used as a way to convert those new website visitors into paying customers. However, the cost of those free things adds up quickly, so it’s best to restrict your giveaways to things like free e-books, a recipe, instructions on how to do something, a webinar, or a guide for a product.
Ignoring Customer Service
This may be the single biggest mistake that any business owner can make. While customers usually don’t share the great customer experiences with their friends and the world, customers never forget poor customer service, and they will tell everyone they know. Treat each and every customer with respect and try to make sure that they have a good experience with your business. If a customer does have a complaint, try to resolve it as quickly as possible.
Not Taking the Time to Hire the Right People
This is a huge mistake that many business owners make when their businesses start growing, especially when it comes to web design. In a rush to make sure he/she can meet demand, a business owner hires the first person who seems qualified, only to discover later that the person really isn’t the right fit for the job. Look for the right combination of skillsets, personality, and commitment to the company. Take your time and find the right person for the job, not just the person you can hire soonest.
Trying to Do Too Much with Social Media
Don’t spread yourself too thin on social media. Yes, social media is a must for virtually every business now, but not all social media is created equally. Rather than trying to utilize every single social media platform, choose the platforms that are most suited to your business. Facebook is a must for every business, but Instagram is better suited to businesses such as restaurants. Other platforms like Pinterest are designed for more artistic businesses.
Worrying Too Much about the Small Stuff
Keep your focus on the big picture, not necessarily the little details. If you get sidetracked by small things like business cards or the design of your business logo, then you’re not paying attention to the more important aspects of your business. That lack of attention can result in damage to your business.
Underestimating What It Takes
Many business owners make the mistake of thinking they can relax once the business is launched. You’ll still have to work just as hard once the business is up and going, just on different aspects of your business. A business should always be evolving and changing with changing trends, and a business owner is responsible for that evolution.
The reality is that while some online businesses succeed, many will fail, often within the first year. There is no one-size-fits-all solution for every business. What works for one company doesn’t always work for another. However, there are certain common mistakes you can avoid to give your business the best possible chance of succeeding.