Are you concerned with fueling business success for your startup or small business? As many will tell you, it is a dire struggle but one you must win if you want your business to grow and thrive (as you can see in the image below). That is no lie in the business world. Still, it is an achievable thing. So how do you go about it? Well, today, I share tips for fueling business success that work for my clients.
As you can see in this graphic, 90% of new businesses fail. Some fail the first year, but most fail within 5 years.
The biggest reason for failure is that there wasn’t a need for the product. Either it faced stiff competition from more established brands, or there wasn’t sufficient demand for the product to allow them to succeed, or it didn’t offer a competitive advantage sufficient to persuade consumers to buy their product, or a similar reason. The critical issue here is to remember that consumers don’t buy products, they purchase solutions to their problems. Offer a tangible solution to their problem that surpasses other options and you’re well on your way to fueling business success.
Of course, even with the right product, you still face other challenges marketing your product; namely convincing a sufficient number of consumers that your offer the right price, in the right place, at the right time. This takes promotion.
Now, let’s take a deeper dive to offer tips for fueling business success.
Tips fueling business success
Just as you’ll never reach your personal goals without sufficient planning, you must plan for the success of your business. At a minimum, your marketing plan must contain:
- An objective evaluation of the external environment, specifically elements that might impact your business success including the political/ legal environment, the technological environment, the cultural environment, the economic environment, and the competitive environment.
- An unbiased review of your existing marketing strategies related to your product, promotion, pricing, and distribution including metrics from past marketing efforts.
- Your goals and objectives, preferably SMART goals that are specific, measurable, achievable, relevant, and time-bound.
- Concrete plans for upcoming actions related to your internal elements based on changes in the environment and the outcomes of past actions.
- A budget
- Monitoring strategy to ensure you learn what actions produced desired results and which didn’t.
- Contingency plans you can quickly implement when something goes wrong.
Employ effective management
Management is about getting things done primarily through administration, control, supervision, and directing business affairs. When everything is done orderly, and everyone knows the part they play, plans get implemented as you anticipated giving you the best chance for success. Effective management means things get done, people work together with little friction, and you have systems in place to handle routine tasks such as payments processing, manufacturing, etc.
Effective management ensures that nothing is forgotten and that all tasks are completed as required for business survival. With it, you get efficient communication that helps with decision-making and problem-solving for the benefit of your business. Effective management also means keeping detailed records that ultimately translate to a successful business because you know what’s going on, what’s working, and what isn’t. For example, with up-to-date accounting records, you know where your business stands financially and possibly address any financial-related challenges. This takes care of the second leading cause of business failure, cash flow (more about this below).
Liquidity and debt management
Liquidity is how easily you can convert your business assets to cash without changing their market value. For instance, accounts receivable are fairly liquid since you expect customers to pay you within 30 days. Your equipment isn’t liquid since you would likely lose money on that investment if you needed cash. For your business to grow, you need easily accessible funds to help in daily operations, like paying suppliers and employees, purchasing inventory, and keeping the lights on. However, accessible options like loans can help you boost business liquidity. For instance, construction financing can help avoid a short-term cash shortfall since you must often purchase a lot of material and pay wages before you get paid for your work.
A profitable business may borrow funds in order to facilitate or meet its needs. You may borrow money to fund growth/expansion, obtain working capital, maintain good cash flow, acquire a new business, and more; thus fueling business success. If you want to take on debt, ask yourself if it is really needed and if it is payable by the company. Taking loans that may be impossible to pay back may hurt your business in terms of attracting investors or even cause business insolvency.
Even as you think about liquidity, consider investing in stock or other options as a way to make extra money work for you since these financial instruments are easily liquidated, providing cash for business operations.
Customer satisfaction and promotion
Customers are the backbone and steerers of business success. They’re the only source of free money to fund business operations as they don’t require anything except value in exchange for their cash rather than interest like a lender or dividends like an investor.
Fueling business success means generating a steady stream of new customers for your business and retaining existing customers through a combination of promotional efforts and providing customer satisfaction to everyone who encounters your business.
You can attract new customers and remind existing customers to return for future purposes through promotions such as:
- advertising on TV, radio, online, or in newspapers
- using a salesforce to promote your product to customers or to retailers (either online or offline)
- generating leads through various marketing channels and then nurturing those leads with a steady stream of valuable information
- offering incentives like discounts, rebates, and free samples
Once you motivate consumers to interact with you (online, by phone, in your store) or sell them a product, you must ensure high levels of customer satisfaction by providing highly valuable products, quickly answering queries and complaints, being pleasant and helpful in all interactions, and making consumers feel valued.
Build a competitive advantage
For your business to succeed, you must gain a competitive advantage against your rivals. The business environment is competitive, no doubt. So, look for ways to set your business apart; for example, identify a niche market and provide quality products or services that meet their unique needs. Offering cheaper products and services is a means to gain a competitive advantage, but that strategy favors companies that can afford to lose money in the short run unless you have a way to spend less to provide the product to customers. In the ad below, you can clearly see the competitive advantage Apple seeks in its competition with other PCs.
Monitoring and adjusting
Metrics fuel business success and any business that doesn’t constantly monitor KPIs (key performance indicators) is doomed to fail or at least never achieve its potential. Among the KPIs you must monitor are:
- Customer Acquisition Cost (CAC)
- Lifetime Value of a Customer (LTV)
- Return on Investment (ROI)
- Return on Ad Spend (ROAS)
- Marketing Qualified Leads (MQL)
- Sales Qualified Leads (SQL)
- Follower Growth
- Conversion Rate
- Website Visitors
- Social Media Engagement
- Referral Traffic
- Net Promoter Score (NPS)
- Organic Traffic
- Event Attendance
- Customer Retention
You must not only monitor your performance across these KPIs but set goals for each so you can determine whether you’re achieving sufficiently high performance on each KPI. Your analysis must include an evaluation of why you failed to meet your goals for one or more KPIs so you can adjust your strategy in future periods to optimize performance.
Business success is about ensuring that you attain business sustainability and longevity. It is a no-brainer for every entrepreneur.
Are you challenged by working towards business success and seeing no way out? You don’t have to keep struggling. Use the pointers and tips highlighted above, and you will see yourself grow a fruitful venture. Remember, business success is not achieved in a day, so be patient as you employ these strategies.
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Hausman and Associates, the publisher of MKT Maven, is a full-service marketing agency operating at the intersection of marketing and digital media. Check out our full range of services.