of Challenges for a Startup or Small Business:
Finding Customers, Brand Awareness, Email List, Lead generation, Customer Delight, Hiring Talent, Managing Workflow, Financial Planning, Growing, Customer Service.
Failure & Fixes. In the first few years of business, small companies come up against a lot of different challenges. Some are harder than others to overcome — and according to the U.S. Bureau of Labor Statistics, about 20% of small businesses fail by the end of their first year. By the end of their fifth year, 50% go under; and by the tenth year, that number rises to 80%. With survival rates like that, it’s easy to understand why Founders face the first few years of business with anxiety. But in fact, many common business problems & challenges are actually fixable. Many times, you’ll find you need to take a step back, take the time to understand the problem you’re facing, and re-think your strategy.
Challenges. Here are several challenges every small business faces, along with some tactical advice about how to fix them.
1. Finding Customers
This first one isn’t just a small business problem. The marketers at well-known companies like Apple, Tesla & Subway don’t just sit around waiting for the leads to come in: Even the biggest, most successful companies have people working hard every single day to find new Customers. But for small businesses that aren’t a household name, finding Customers can be particularly challenging. For example, there seem to be so many channels you can choose to focus on… How do you know what to prioritize & where to allocate resources?
How to Fix It:
Finding Customers starts with figuring how who your Ideal [Target] Customer actually is. You need to make sure you’re spreading the word to the right people. Draft an idea of what your Target Customers look like, what they do, where they spend time online by building your Buyer profile. Creating very specific profiles can dramatically improve your business results. Once you’ve built that profile, you can start creating content & figuring out how to get to your Target Customers in the places they spend time online and with the messages that they care about.
2. Increasing Brand Awareness
If your Customers don’t know who you are, they can’t buy from you. It can sometimes seem like today’s biggest brands seemed to have popped up out of nowhere. How did they become a household name? How did they grow that quickly? Can your business grow like that, too? Of course, most of these companies’ hard work, failures, & rejections happened behind the scenes. But there are strategies for spreading the word about your brand and building a great reputation that you can start right away.
How to Fix It:
There are many ways to spread Brand awareness, but these are the easiest.
- PR: Public relations is less about paying for a spot in a news Blog, and more about focusing your voice and finding your place in the market. I recommend reading this great post from FirstRound Capital on what Startups & Small Businesses often get wrong about PR – which also includes some great, tactical tips on how to figure out who’s covering your industry, building relationships, & working with reporters. You can also download our free PR kit to learn how to maximize your public relations efforts with inbound marketing and social media.
- Co-marketing: Partnering with another brand will help you inherit some of their image & reputation + create brand evangelists outside your circle. It’s a fantastic way to gain a large volume of new contacts alongside your organic marketing efforts.
- Blogging: Running a consistently high-quality Blog will also help you build brand awareness. Not only does a Blog help drive traffic to your Website & convert that traffic into leads, but it also helps you establish your credibility in your industry and trust among your prospects. It’ll also help you build an Email list, which brings us to our next point…
3. Building an Email List
In order to move prospects along their buyer’s journey to eventually become your Customer, you need to build trust by staying in their mind, then providing value consistently. That starts with getting prospects into your Email list. As if it isn’t hard enough to build an Email list, the average marketing Database degrades by about 22.5% every year. That means you have to increase your Email list by almost a quarter each year – to just maintain it, never mind grow it. It’s your Marketing’s job to find ways to constantly add fresh, new Email contacts to your lists. But what many people call “building an Email list” is actually buying an Email list — and buying an Email list is never a good idea !!! I repeat: Never a good idea. Not only will your Email deliverability & reputation be harmed, but it’s also a waste of money. If your current strategy is to buy or rent Email lists, then it’s time to re-group and find better places to put those resources.
How to Fix It:
Instead of buying or renting lists, build opt-in Email lists. An opt-in Email list is made up of subscribers who voluntarily give you their Email address – so you can send them Emails. The act of opting in necessitates Website functionality that captures their Email address. This can be achieved with a form builder or other conversion tool. The other piece of the puzzle is creating demand. You can do this by creating great Blog content and making it easy for people to subscribe — which, at the same time, will help you increase your online presence, build up search authority, & create evangelists from your content.
How to Re-Vive it. You can also revive older lists that you think are mostly decayed by creating an engaging opt-in message and sending it to your old list encouraging contacts who wish to re-opt-in and promising to remove all contacts who don’t respond.
Growing your Email list doesn’t necessarily translate into growing your list of sales-qualified leads, which brings me to my next point…
4. Lead Generation
Another challenge most small businesses share is Lead generation — specifically, generating enough Leads to keep Sales busy getting new Customer to keep a good (+) Cash Flow. But generating Leads that are both high quantity & high quality (Q&Q) is marketing’s most important objective. A successful Lead generation engine is what turns Website visitors into prospective Customers and automatically provides a steady stream of sales prospects.
How to Fix It:
To make the Lead generation process work for your business, you need to first optimize your existing Website for conversions. Your Website is the most important tool you have for turning prospects into Customers. Look through your Website and ask yourself:
- Do each of your Webpages clearly guide visitors to take action, or do they leave them wondering what to do next?
- Do you use a tool that automatically pulls the submissions from your forms and puts them into your contact database, like HubSpot’s free lead generation tool?
- Are you creating custom Landing pages for every single campaign that you run?
- Do you have Lead generation calls-to–action on each of your Blog posts? (Do you have a Blog at all?)
Prioritize the most popular pages on your Website first. Most businesses have a few, specific pages that get the majority of the traffic — usually the Home/Landing, then About, & Contact pages or maybe one or two of your most popular Blog posts. Review this Blog post to learn how to figure out which pages to prioritize, and how to optimize them. Then, implement conversion tools such as: Pop-ups, Hello bars & Slide-ins. Finally, be sure to take advantage of free Lead Management software & apps for startups. Affording marketing in general is a big challenge in & of itself, so finding & implementing the most robust “free” marketing tools can be a game changer.
5. Delighting Customers
Customer satisfaction is a great goal, but Customer delight is even better. After all, delighted Customers are the ones who buy from you again, write testimonials & agree to case studies, + refer you to people they know. In order to achieve true Customer delight so that your Customers become promoters of your business, you must surpass expectations and deliver an unmatched experience.
How to Fix It:
It takes work to continue providing value to your Customer in a way that turns them into raving fans. Here are some steps get you in the right mindset:
- Understand why your Customers chose you and what they need
- Set specific expectations at the start of the engagement
- Deliver on those expectations (and satisfy your Customers’ needs)
- Innovate how you can provide unexpected extras that go above & beyond their expectations
- Continue to measure satisfaction to improve the Customer experience
6. Hiring Talented People
None of the above can happen at scale without a fantastic team that understands your vision & supports your efforts. Hiring is often one of the biggest challenges for small businesses, especially since small business executives tend to feel under-resourced to begin with. Hiring new employees is a big deal & complex process, + the cost of on-boarding is an average of over $4,000 per new employee for most companies. And if you don’t hire well, employee turnover can be very, very expensive. It’s impossible to know everything yourself. That’s why finding and hiring the right people — including the people who are really excited about what you’re doing — matters.
How to Fix It:
It’s easy to hire with a short-term mindset: send out a Job description, interview applicants, then make a decision. But because of the high costs of hiring right, it’s important to invest a significant amount of time in the hiring process. Don’t settle for good employees when you can find Gr8 ones, even if it takes longer. It’s the great employees that will help your company get to the next level. Just like you create a buyer profile for your Customers, create a profile for your job candidates. Your profiles should be different for each new role that you’re hiring for, but will share some underlying traits around company culture. Next, take ownership of attracting candidates to your company’s core and make them interested in learning more. This will help you build a recruiting pipeline that will give hiring the same predictability as sales. Then, turn those leads into applicants.
7. Managing Workflow
Once you have the people in place to make the magic happen, the next challenge is managing Workflow as you grow. You want to ensure that your team has the processes & tools to do good work and do it efficiently. At the same time, you can’t be everywhere at once as their leader. So how do you focus “on”: the business while ensuring that everyone working “in” the business has what they need?
How to Fix It:
The best ways to diagnose the challenges your team faces, then increase efficiency – is by creating ways for them to provide feedback. This can be done through:
- Employee Satisfaction surveys
- Frequent one-on-one meetings with direct reports
- Asking about threats to the business and the issues that give them the most “pain” in their roles
- Finding out what’s common in the feedback you receive and fixing it
8. Financial Planning
In theory, more resources (whether it’s people, tools, or time) increase efficiency & quality. Creating smooth operations starts by providing all the resources you can to your team. It sounds simple in theory, but did you notice the caveat, all … you can? Unfortunately, leaders have Budget restrictions based on revenue & margin. It, then, becomes a challenge to improve efficiency while working within certain limitations, by investing in your business without over-spending outside your means. This is solved by making good decisions based on solid financial planning.
How to Fix It:
Every business will be different, but you’ll want to use business Credit wisely, cut Costs where possible, & manage Cash Flow by staying on top of Invoices & book-keeping. Business accountants & Financial advisors can help you analyze your financial situation and help you make good decisions.
9. Growing your Business
There’s this mix of growing early, vs doing what you have to do to get it all done. This is a tricky one, especially since every situation is different. You’ll see this problem arise in all areas of business: in product development, marketing, hiring, etc. For example, many Execs will push growth at all costs. But if you grow your company too quickly, you’ll find yourself having to hire too quickly. This can overwhelm your experienced team members, because it takes a while to train people & bring them up to speed. And if you don’t train people well, it can end up backfiring.
How to Fix It:
Unfortunately, there’s no perfect answer here. Depending where you are in your lifecycle, the scale of growth will tip one way or the other, but I do think you need both at different times. What it comes down to is not obsessing over every detail, but obsessing over the right details. Obsessing over product perfection, for example, might not be as important as obsessing over Customer service. It’s better to put your fears aside and launch a product that isn’t perfect, because you can always improve it. After all, once your products are in the hands of your Customers, you can learn much more quickly what’s working & what isn’t.
10. Obsessing over Customer Service . . .
is worth the extra effort. There are many ways to focus a business. You can be competitor focused, you can be product focused, you can be technology focused, you can be business model focused, and there are more. But, obsessive Customer focus is by far the most important from Day 1.
How to Fix It:
- · Encourage collaboration
- · Make your customers feel heard
- · Meet your customers where they are
- · Use feedback to get better
- · Combine data with empathy