There’s never been a better time to be an online entrepreneur. If you’re like many, many millions of people, you’re considering starting your own business because the Internet has made it possible. The problem? Standing out from among those other millions, and succeeding where (statistically) most of them will fail.
That’s not meant to be pessimistic. A recent Huffington Post study claims that up to 90% of online businesses fail within the first four months! That number is no joke, but it shouldn’t discourage you— it should focus you. If you’re going to do this, you’ve just got to give yourself every advantage possible. And that means avoiding some very common, very avoidable mistakes that take down the vast majority of amateur business people.
Fortunately, we here at The $100 MBA have seen quite a few businesses succeed and fail. Heck, I’ve even made some of these mistakes myself in previous business ventures that— obviously— didn’t work out. So let our experience be your guide. Here are the first 5 of the 10 most common online biz-kills:
- Lack of Commitment
This may be the most common of all. Innumerable business die before they’re even born, because the person behind it never moves past the planning phase. It’s not laziness, and it’s not even necessarily inexperience. It’s a refusal to accept the scary reality of unpredictability.
The problem is that too often, would-be entrepreneurs try to create— or wait for— the perfect conditions. They try to get the idea perfect, or the marketing scheme perfect, or the financial situation perfect. But it never is. The reality is that starting a business requires working with what you have, making moves, taking risks, improvising, and yes, accepting the possibility of failure.
You can’t failure-proof any business. There will be risk no matter what. No one can set their venture up to guarantee success. While the idea phase and the “talking” phase are certainly comfortable, they’re not going to turn any profits. At some point, you’ve got to move.
- Lack of Planning
Conversely, while some entrepreneurs never stop planning, some don’t do enough! While over planning is a one-way ticket to nowhere, under planning wastes just as many good ideas. Again, the goal is not to create the ideal conditions for success. Mainly, it comes down to dedicating the right amount of time.
That’s it. Time. Too many overconfident entrepreneurs think that they can tackle their responsibilities whenever, in their spare time. They aren’t specific in dedicating the spaces on their calendar to meeting their business goals. In fact, they aren’t making specific business goals. Launch dates, content production, meetings: these things need to be scheduled.
Think of it like exercise. If you want to get in shape, you can’t just work out “whenever.” You have to consciously put aside a given number of hours in the week, working each time towards specific sub-goals that add up to an overall result. Business is the same. You don’t have to know everything, but you have to know what you’re trying to do— and more importantly, when you’re trying to do it.
- Lack of Action
This problem, like #9, also comes down to the one component no business can survive without: consistency. While entrepreneurs in the early stages have all the manic energy of the honeymoon phase, a flurry of activity quickly dies down to a trickle, then to nothing. Sooner or later, an un-updated website is taking up cyberspace and receding into memory.
Again, scheduling is key. Setting aside time to regularly accomplish specific tasks creates the consistent, steady momentum business really thrives on. Resist the early urge to pour all of your efforts into the business every spare moment, leaving nothing for later. Parcel out your enthusiasm in a thoughtful way, so that you’re still getting things done 4, 6, and 12 months later. As an entrepreneur, you have freedom. You’ve also got to have discipline.
- Over Reliance on Social Media
Too many people think that social media is some kind of magic shortcut to notoriety and success. They think that if they can just get the Twitter followers, the Facebook friends, or get their content to go “viral,” they’re in the money. It just doesn’t work that way. Even the most wildly successful social media campaigns have serious forethought behind them, and the businesses in question don’t just do business on these platforms.
The key to marketing success— even on social media— lies in creating and producing quality content from your own website. You must have your own headquarters, your own “storefront” in cyberspace. Your business has to be centered on a home base that you control, not Facebook. Create awareness on social media, engage in social media. But be aware of its limitations, and always make your own website the fount of value for your audience.
- Not Targeting an Audience
This point is absolutely crucial for small business— the key word being “small.” As entrepreneurs, we’re not Wal-Mart. We’re not Apple. Our job is not to appeal to the masses and try to win the lowest common denominator. Mostly because we can’t; that requires resources independent businesses don’t have. But also because it’s contrary to the goal of any great independent business: solving specific problems for a specific audience.
Don’t try to cast your net too wide. Take the skill and expertise you have, and use it to address the needs of a small group that only you can serve. What you eschew in quantity of customers, you gain in loyalty of customers. Go for the niche, and the niche will reward you. Not to mention the fact that even a small niche can grow into a significant following if you’re later willing to branch out. Develop a strong, personal connection with a targeted audience, and your devotion to it will sustain real success. Otherwise, you’re just shouting into an unimaginably large crowd.
These are the obstacles that plague online business. They’re not the reasons you can’t succeed. They’re the things you’ll succeed despite, as long as you’re aware of them. Keep them in mind. Maybe even keep them written and displayed somewhere as you begin your journey. Check back for Part II of this list, and the final five pitfalls to avoid.