Entrepreneurship is all about navigating the rocky road to success. The main question here is: how do you grow an online business when there are countless similar products and services on the market? The answer is straightforward—learn from others, outline your company values, and develop a unique brand and marketing strategy.
This article explains why most businesses don’t make it past their first year and offers practical tips for business promotion. Keep on reading!
Why online businesses fail
The price of faults in business can be high, which is why it’s wise to learn from the missteps of others. According to Entrepreneur, 90% of online companies flop within four months of launching.
FAQ: How can you take your small business online?
To bring your offline business online, start by establishing a presence on the internet. Begin by creating your website and adding your company profile to Google Maps. Besides, consider setting up branded accounts on social media platforms.
The reasons for failure vary depending on the owner’s experience, but some of the most common mistakes include:
- Insufficient cash flow management. When you start earning profits from your business, the urge to spend it on personal expenses can be strong. However, the first few months of development are often the toughest, as you need to recoup your initial investments. This means that for at least a year, you should focus on investing in the company’s growth—allocate a budget for marketing and analyze expenses.
- Lack of fundamental business knowledge. Technology has made launching a business accessible to everyone. For example, to start an online store, you can utilize ready-made templates. However, this doesn’t negate the importance of entrepreneurs understanding business logic.
- Absence of a clear business identity. When starting an online business, novice entrepreneurs frequently lack an understanding of what they’re offering, who their target audience is, why their product is compelling, and what the long-term prospects are. Take the time to answer these questions before moving forward with promotional efforts.
- Poor service quality. Launching a company website is only the beginning. You should consistently analyze visitor metrics to identify areas for improvement. For example, by studying the customer journey and enhancing your website’s user experience (UX).
As the founder of one of the most successful online businesses, Jeff Bezos, once said: “If you don’t understand the details of your business, you are going to fail.”
FAQ: What should you not do when starting an online business?
There are plenty of mistakes to avoid. For example, starting a company without a solid business plan or neglecting investments in brand communications. But one of the biggest mistakes is trying to handle everything alone. Typically, entrepreneurs have expertise in their niche and worry that other team members might not perform tasks correctly. Nonetheless, learning to delegate tasks and tapping into the potential of people right from the start is crucial.
5 steps to grow your business and avoid mistakes
Your small business growth strategies may differ from those pursued by your competitors. For example, you might invest in different marketing channels, or your budget could be smaller or larger. The key is to identify what works specifically for you.
FAQ: How can you be successful in online business?
Novice entrepreneurs often focus on minor tasks, neglecting the comprehensive brand strategy. They fail to understand their product’s value and target audience. As a result, the company lacks a clear understanding of where it’s heading. If you’re also facing such challenges, start by developing a marketing strategy—outline your target markets, buyer personas, and objectives.
Let’s go over the basic steps needed to start growing your business.
#1 Outline your core brand values
Why do some businesses succeed while others fail? It all comes down to the mission you want to accomplish. And it’s not just about making money. For instance, some aim to use technology to change the world for the better, while others seek to create a nurturing space for professionals to thrive. Consider what sets your business apart and integrate that idea into every aspect of your strategy.
Since its inception, Amazon’s core brand values have been customer obsession and long-term thinking, as vividly depicted in the book “The Everything Store.” A prime example of this occurred when the book “Harry Potter and the Goblet of Fire” was released in the summer of 2020, while Amazon’s stocks plummeted. Jeff Bezos made the strategic decision to offer a 40% discount on purchases, along with free shipping. This move was initially viewed as extravagant by investors. However, it ensured that customers received their copies on the day of the book’s release. In the long run, this decision had a positive impact on customer service.
#2 Define your target audience
Before selling, start with understanding your target audiences, their needs, pain points, and desires. While there may be multiple segments for a single product, it’s essential to focus on the most relevant one at the beginning.
To do this, analyze existing data (e.g., through Google Analytics or surveys of your sales managers) and create buyer personas that encompass demographic, behavioral, and other relevant factors.
#3 Diversify your product line
A diversification strategy is when a business offers a range of products to meet various needs. They can also be promoted through multiple marketing channels.
Let’s look at a real-life example. Microsoft offers the Windows operating system as its main product. However, they diversify it to cater to different needs, such as for individual users and businesses. While both Windows Home and Pro provide basic functionality, the latter offers additional features.
#4 Maintain consistent branding
New businesses may fail to see the value in investing in corporate materials such as logos, brand guidelines, unique color palettes, etc. Yet, these elements can set you apart from competitors. Establish your brand identity and convey it across all marketing channels to enhance your online presence.
#5 Focus on customer retention
Statistics show that acquiring a new customer is five times more expensive than keeping an existing one. Besides, by increasing retention rate by just 5%, you can potentially boost profits by 25–95%. At the same time, only 18% of companies prioritize retention efforts. This can be a valuable lesson for your business.
How can you retain existing customers?
- Continuously gather feedback and react promptly;
- Resolve issues quickly;
- Provide more than expected;
- Maintain regular communication through emails, social media, personal calls, etc.;
- Implement loyalty programs;
- Offer helpful online resources, FAQs, and knowledge bases.
Conclusion
There isn’t a one-size-fits-all answer on how to grow a brand, as each business’s journey is unique, even if they share the same owner. However, successful companies are those that offer something beyond mere profit-seeking. They consistently prioritize customer care at every stage of interaction. These are all important aspects to consider when you’re developing your business.
