The continued rise in the number of online businesses is here to stay. Online businesses are the future, after all. The potential of online businesses is mostly unquestionable. The prospects are there, and there is more than enough for everyone. Despite all that, many online businesses fail – roughly 9 in every 10. Profitability for online businesses is there, but the majority never make it. Why is this so? This is the subject of our discussion today. Once you know why you will be better equipped to avoid pitfalls many succumb to. Here are the top reasons why most online businesses fail:
Cutthroat Competition
You must understand that virtually anyone can start an online business. It is so easy that more and more online businesses are popping up. This makes the landscape highly competitive. This means it will get you out of the game if you are lacking in something, even slightly. For example, someone using influencer marketing will thwart one who is not. Someone using paid ads will have more traction than one who solely relies on organic growth. One who generally understands digital marketing better has the advantage. It is easy to start an online business, but it takes a lot to stay competitive. Many online businesses fail because they drop the ball on many pertinent things in their operations. Kindly go through the article, 5 online growth strategies for small businesses. 4 digital marketing trends for 2023 will also help you.
Poor Market Targeting
When running a business online, the market target is crucially important. What exactly is your target market? People online naturally gravitate towards what appeals to them. Remember that we just highlighted stiff competition online. To stand out, you must have a unique and superior value proposition. To figure that out, you need to know your buyer persona. A buyer persona is a detailed description of what you consider your target or ideal customer. This is one of the secrets behind what makes an effective digital marketing campaign.
Having a buyer persona guides you in targeting your digital marketing efforts accurately. Your market research informs a buyer persona along with any relevant data. The research usually seeks to understand people’s pain points. Calculated assumptions also inform it on what exactly your ideal customers would need. You need to know and periodically update your buyer persona when necessary. Buyer personas enable you to capture your ideal customers easily. Many fail because they are clueless about who their target market is.
Poor Customer Relationship Management (CRM)
This is an area many online businesses, especially in Zimbabwe, struggle with. If you are running a business online, the need for customer support is sky-high. I have noticed some do not have at least someone taking care of that – dedicated staff. That is why you will ignore queries or questions, e.g., emails, messages, comments, calls, or SMSes. They may also respond late or not follow through when they make promises or commitments. This area separates the winners from the losers. If you perfect this, I can guarantee you will outdo many other online businesses. “How to effectively engage and enlarge your social media community”. That article will teach some principles necessary when dealing with people online. You must also check out another one on the four benefits of talking to customers. To learn more about CRM, read an article titled Using a CRM System to give your clients premium service.
Poorly Designed Digital Platforms Or Tools
Here I am referring to websites, web apps, or mobile apps. For an online business to thrive, it must have at least one. Personally, I have come across a few online business digital platforms in Zimbabwe that are top-notch. Most have operational issues that make customer experiences horrid. One of the most common things I have noticed is using unsecured websites. The other one is websites or web apps that are not responsive. This means they are not optimized for mobile.
It is also commonplace to find websites, web apps, or mobile apps taking ages to load. At times they freeze or time out. If you have these issues, you will lose prospects and even customers. Do not forget the cutthroat competition; you will sink if you do not put things in order. We published a walkthrough of Get It Here, a Zimbabwean ecommerce platform. You will get an idea of some important things to consider when developing digital platforms or tools.
These are 4 reasons why most online businesses fail. All 4 are not even rocket science. These are areas you can sort out from the onset or correct at any point. You cannot afford not to. If you ignore them you will definitely struggle to excel in your online business. That would be ironic given that online businesses are laden with limitless profitability if well-executed.
