Back in 1997, Netflix entered the movie entertainment industry, competing with the leading provider of home movie and video game rental services, Blockbuster.
Welcomed with skepticism, the powerhouse brought new solutions to movie watchers: DVD-by-mail subscriptions, video streaming, and branded content. However, success did not come quickly. In 2011, Netflix lost over 800,000 members due to increased pricing and over confidently moving too quickly. Fast-forward to today and Netflix now serves over 125 million users worldwide. What lessons can we learn from Netflix’s success story? No matter how innovative or market ready your business may seem to be, snags will come; so be prepared.
Before you dream of the big bucks and a healthy bottom line, metaphorically view yourself as a runner in a marathon; the tortoise versus the hare. You, in some way, have prepared for this race. As you approach the line and begin to secure your footing, different scenarios and ideas fill your head with ways to finish the race on top. You’ve prepared for the victory lap, the prize.
The gun shoots and you’re off. While admiring the roar of the crowd, you unintentionally misstep, tripping over yourself, and stumbling, as you view your competition continuing on ahead of you. As a business owner, it is easy to be hare-like: passionate, enthusiastic, full of ideas, and overly confident, lacking a plan and discipline, because of underestimating the unforeseen challenges ahead.
Instead, be like the tortoise. Prepare for a marathon. Consider these common mistakes small business owners make and, if you’re currently guilty, remedy them as early as now:
1. Doing it “Solo-Dolo”
You might believe it to be more efficient if you do everything yourself. As a startup, most business owners do, in fact, juggle many hats: sales, marketing, accounting, human resources. However, eventually business grows, becoming more demanding of your time and you won’t be able to expertly handle all aspects of your business. As a potential result, your business could become inefficient and unsustainable.
Delegation is key.
Hire the right kind of talent needed for your business. Start by hiring an assistant (virtual assistants are a great option) part time for specific tasks, eventually increasing the hours as you see fit. This will free up your time abit, allowing you to focus on growing your business and reaching your targeted audiences. Plus, collaboration always sprouts the best ideas.
2. What Business Plan?
Yes, some successful business plans like J.K. Rowling’s might have been created on a table napkin. But this may not hold true for everyone. A business plan is very much like a blueprint for a house or a building. It helps integrate all of your ideas in one place, and expound on those ideas for implementation.
A good business plan should cover all aspects of the business, including summary, products and services, customers/targeted audience, marketing, strategy, pricing, and financials. Like blueprints, business plans should have contingency plans and exit strategies in place as well. Some may think business plans are an unnecessary nuisance – however, having a solid strategy allows you to go back to the books when things go awry.
There are a lot of resources online on how to create a business plan, and you do not have to be an expert to put one together. Whether you plan out the next year, or the next three years, you will not go wrong with having an operation efficiency strategy in place.
3. “I am my only competition.”
New businesses are established daily, and as the saying goes: there is nothing new under the sun. Thousands of companies have competing products and services, creating variations in marketing and branding; (Note: have you walked down a bread aisle lately?) By negating the vital step in conducting an analysis of your market, you’re tremendously undermining your potential to connect and capture your targeted audience. Knowing where you stand among your competition is essential for several reasons. With this knowledge, you can:
- Determine a competitive price point based on what competitors offer
- Identify marketing and advertising dos and don’ts
- Provide better quality products or services
Knowing where you stand and how to remain competitive gives you a lot of foresight when creating a successful business.
4. Marketing, Smarketing!
Sure, you have an awesome product or service; but how are you reaching your targeted customers? Marketing is vital for any business and content is the king of today’s marketing environment. The most successful brands in the world have developed detailed marketing strategies that help them inspire, entertain, and connect with their target audiences.
Whether it be print, social media, or blogs, marketing is essential in increasing your brand visibility and sales. If you currently do not have a marketing strategy in place, start by setting a feasible marketing budget, and utilize the various free marketing platforms. Keep in mind that marketing is only as effective as the analytics that back it up. Blasting content that does not actively engage your audience or increase sales is just as bad as not having a strategy at all. Analyze and understand what your analytics reveal about your marketing and steadily work towards improving your methods.
5. “I know what people want!”
In order to market something people want, you must understand who they are and what they need. Carefully define your targeted audience(s); the narrower the focus, the faster the growth. Once you have identified your customers, craft messaging that translates the value your brand brings them. Again, you can only tailor your content once you’ve researched and understood the needs of your customers. After giving your audience a reason to connect and consume, you will establish and retain loyal and passionate customers.