Get Access to 250+ Online Classes
Learn directly from the world’s top investors & entrepreneurs.Get Started Now
- 1. Doing It All By Yourself
- 2. Losing Your Focus
- 3. Doing Social Media The Wrong Way
- 4. Not Setting Measurable Goals
- 5. Doing Marketing The Wrong Way
- 6. Budgeting Too Much (Or Too Little)
- 7. Promising Too Much
- 8. Having A Poor Online Presence
- 9. Loving Your Product Too Much
- 10. Downplaying The Competition
- Plan For Mistakes Today
Are you terrified of making small business mistakes? Worried sick that you might take one wrong turn and kill your startup? Don’t worry, because millions of entrepreneurs have made mistakes that you can learn from. Nobody’s perfect, but if you understand the worst small business pitfalls, you’ll be able to avoid them and save your business.
In 2011, The New York Times created an email campaign to send to a few hundred people who had recently canceled their subscriptions. The email contained a compelling discount: a 50% discount for 16 weeks.
It would have gone well if the Times hadn’t made one mistake. Instead of going to the few hundred people who had recently cancelled, the email was sent to a list of 8.6 million people.
It’s a simple mistake that anyone could have made, but it caused a lot of headaches (and a good amount of profit loss). Most importantly, it was easy to avoid.
Even an expensive mistake can be dodged if you prepare yourself.
With that in mind, let’s take a look at the 10 biggest small business mistakes that entrepreneurs make over and over again. Once you’re done, you’ll know exactly how to avoid business failure.
1. Doing It All By Yourself
As an entrepreneur, you’re self-driven, super motivated, and willing to put in countless hours of hard work. That’s all awesome.
The problem arises when you go too far and think that you can do everything solo. You might think you’re a superhero, but eventually, you realize you can only do so much.
The mistake: Entrepreneurs love the feeling of being able to finish a day’s work all by themselves. But these jack-of-all-trades entrepreneurs quickly lose traction because it’s impossible for just one person to run a scalable, successful business.
The solution: First, know your strengths. What are your specialties?
Maybe you’re dynamite at coming up with a home run marketing plan, or perhaps you’ve honed your product research skills. Zero in on what you’re really good at and stick to that.
Next, find an amazing cofounder who compliments your skill set, and bring on a stellar team using a killer onboarding process. Don’t hire more people than you need, but don’t try to do more than you can.
2. Losing Your Focus
Running a business means keeping a keen eye on your goals. In a perfect world, that would never be a problem, but you probably know firsthand that sometimes you lose your focus.
The mistake: Over time, as you deal with more resources and have to juggle more tasks, you might find yourself drifting away from your objectives. Your product or service will likely suffer, and your day to day won’t be productive.
The solution: Recognize why you’ve lost your focus. Have you lost sight of your company vision? Have you become distracted by exciting new business ideas? If so, recall your goals and do everything you can to stay on track. Concentrate on your vision.
3. Doing Social Media The Wrong Way
You know social media is important. You might even have company accounts already set up and running.
But are you doing it the right way? If you’re like 52% of marketers, you’re having trouble showing social media ROI. So how do you know what works?
The mistake: Obviously, if you’re completely ignoring social media, that’s a problem. However, you might just be wasting time, effort, and resources. Some common small business mistakes that involve social media include:
- Focusing on vanity metrics (such as likes and views)
- Trying to appeal to a huge audience
- Ignoring key platforms
The solution: A good social media strategy requires a lot of knowledge and experimentation. First, find the platforms that work best for you and invest in them.
Then focus on actionable metrics and create goals that you can measure using those metrics. Determining ROI will be easier than ever.
4. Not Setting Measurable Goals
Speaking of goals, let’s talk about how to measure them. Hard-to-measure goals can do a number on your business and cause further problems down the road.
The mistake: Although you’ve set goals, you can’t objectively evaluate whether or not you’ve achieved those goals. This usually happens because it can be difficult to translate big-picture business objectives into measurable goals.
This is why 80% of marketers say that their lead generation is only somewhat effective. (Yikes.)
Basically, if you don’t set metric-based goals, you’ll never know if you’ve succeeded or not.
The solution: Start creating goals that are driven by metrics. Make sure you can objectively measure each and every goal in your business plan with cold, hard data.
Lots of small business mistakes occur from a lack of measurable goals, so this needs to be a top priority for you and your business partners.
5. Doing Marketing The Wrong Way
Marketing is like social media. You know it’s vital, but you may not be utilizing it correctly.
Think about it: How much attention do you pay to marketing? Many times, entrepreneurs avoid marketing entirely, making this one of the biggest small business mistakes.
The mistake: The biggest marketing mistakes involve sending the wrong message to the wrong people. Inconsistent or ineffective branding is the key culprit here.
If your message isn’t crystal clear, or if you haven’t found out who your target audience is, your marketing will flop.
Even worse is not doing any marketing. Believe it or not, 1 in 5 SMBs don’t even use digital marketing.
The solution: First, make sure your brand message is clear and compelling. Second, think about your audience. Are you 100% sure that you’re marketing to the right people? If not, some customer research is exactly what the doctor ordered.
6. Budgeting Too Much (Or Too Little)
When it comes to small business pitfalls, bad budgeting is one of the most dangerous. If you overspend or underspend, you’ll find it hard to tread water in a cutthroat market.
The mistake: Businesses tend to either throw away their capital on a million different things or pinch their pennies and refuse to spend money on anything. Both are common mistakes that are easy to avoid.
The solution: Create a budget and stick to it. Don’t set just one budget, though. Allot budgets for each department.
Also, understand what you absolutely need and what you don’t. Don’t buy something just because it promises a huge ROI.
7. Promising Too Much
When things are going well and you’re brimming with ideas, it’s easy to promise your customers the moon and then some.
That’s why overpromising is one of the most common mistakes entrepreneurs make.
The mistake: You promise that your product or service will have a ton of exciting new features that will change your customers’ lives, but what you deliver falls flat.
It’s the problem video game development studio Hello Games faced when its game No Man’s Sky was released. The game lacked many of the features the company had promised, and customers were livid.
The solution: Be transparent and realistic with your promises. If you’re not sure you can deliver on something, don’t promise it.
At the same time, don’t underpromise. Hype up your product––just don’t get carried away.
8. Having A Poor Online Presence
Would you believe that 60% of SMBs don’t have a website? In general, lots of small businesses fail to develop a robust online presence.
The mistake: Not having a website or any social media pages is a common mistake. Some businesses have an unprofessional appearance; they use a free Gmail account or do all their business through their Facebook page.
The solution: Make a responsive website and figure out what social platforms you should be on. Regularly interact on each platform and update your site and information regularly.
9. Loving Your Product Too Much
As an entrepreneur, you can often get tunnel vision, especially when it comes to your product or service.
It’s not wrong to love what you’re selling! But being too biased toward your business ideas is a recipe for disaster.
The mistake: In short, you love your product or service so much that you fail to see its shortcomings. (Then you wonder why your sales are so low.)
The solution: Question your product as much as possible. Get a range of opinions from customers, team members, and people outside your company. Think lean––how can you improve your product quickly to make your customers happier?
10. Downplaying The Competition
It’s super easy to fall into the trap of underestimating your competition. After all, if you’ve got a stellar product and awesome branding, what’s there to worry about?
While it would be nice to not have to worry about competition, it’s a reality. One you need to be paying attention to on a daily basis.
The mistake: Not tracking your competitors or thinking that you’re obviously better than them.
The solution: Find ways in which your competitors are better than you.
Figure out how you’ll stand out in your industry, and try to fill in the gaps your competitors leave.
Plan For Mistakes Today
Small business pitfalls are inevitable, but you should equip yourself to make the fewest possible mistakes. Entrepreneurs often wonder how to avoid business failure, and while there’s no perfect answer, it helps if you can avoid these 10 common mistakes that have been known to sink businesses. So take the knowledge in this article and apply it to your business.
Then you can stop panicking over mistakes and focus on what really matters.