Online companies are known to have lower overhead, fewer management hassles, and can change direction and respond to the market faster than any brick and mortar company. Meaning it's easier for them to be a high performer than any other business.
Given the low entry fee, and technology making it easier than ever everyone and their grandma seems to be starting an online business. But many are finding it not the magical marketplace they thought it would be.
Now more than ever anyone has the power to start a successful company literally at their fingertips. But that low entry point has also made the number of businesses that fail statistically higher according to some. Where brick and mortar companies are showing to have better-staying power.
So what's going on here? And what can you do as an individual entering this space to avoid failure?
1. You aren't treating it like a real business.
Many times one of the biggest appeals of starting an online business is the concept of working at home in your PJ's. This sometimes combined with making it work for other lifestyle choices like being a stay at home parent or even taking care of a sick loved one.
The reality is; an online business is a business and should be treated like one if it's going to work. An online company needs to be just as aware of ROI, what their business plan is, or who their competition is and how the market is performing. It doesn't matter if it's being run by Mark Zuckerberg or your Grandma. All the same logistics come into play.
2. You're over complicating things.
The best most profitable businesses have one thing in common when they started; they kept it simple.
More products, more activity on social media, and giving yourself access to a wider client base is a recipe for disaster early on.
If we follow the examples of the heavy hitters before us like Google or Facebook. They focused on providing one solution to a specific group. They didn't grow to become what they are now by being all things or offering the wide range of products and services they have now from the start. They grew into each new project slowly over time.
So toss out the complicated social media plan that you think is going to make you a rock star on all platforms, cut things down to a few simple to understand products, and keep it simple. Make your goals clear, and focused around one offering.
3. You quit, instead of pivot
The beauty of running a business in the online space is that you more or less get instant feedback from the marketplace. If you go live, and no one responds you know that something is wrong.
The mistake is when you interpret a negative result as an instant failure overall, rather than looking at what needs to be tweaked or pivoting.
Just as amazing as it is to be able to get instant feedback from the marketplace. You can tweak and change what you are offering, how you are offering it, or how you are marketing it just as quickly. Start treating every client interaction positive or negative or sales result as a data point you can improve on instead of a failure. Pivot your failures instead of dropping them completely.
4. You don't pay attention to the market
The number one thing most overlooked when first starting out is directly tapping into the market and your customers to see what they want.
With social media and how readily available information is it's easier than ever to tap into the marketplace and see what's going on. A quick search on Twitter or Google gives you a direct line to your customers and allows you to see what they think, in their words.
Don't forget, despite the scary numbers, or the mountain of work that needs to get done any businesses goal is to provide a solution. Online or otherwise, if you follow some of the basic principles of business as a whole, combined with connecting to and listening to your customer base you can pivot and keep up even with the big boys.