Learn how startups can dodge Business Blunders
In commerce, even the best-laid plans can fail. Social media can make things worse because, once a marketing faux pas slips out, it can go viral within minutes! Small businesses, which are already dealing with growing pains, can avoid costly mistakes by learning from others.
Here is a list of the worst blunders that any business can ever do:
1. Forgoing Market Research
Finding your market’s pulse lets you know what is trending while keeping you in tune with other buying triggers. It can give you ideas for how and when to launch your new products. Failing to do your due diligence can have disastrous effects on your business.
In 2010, some manufacturers raced to launch their own 3DTV models after witnessing Avatar’s phenomenal popularity. But there was limited programming that can be viewed in 3D, and not many customers liked wearing 3D glasses while watching TV at home. The 3D craze perished within a few years, forcing 3DTV production to grind to a halt.
2. Marketing Without a Unique Selling Proposition
A USP—short for “unique selling proposition”—is a clear statement of what distinguishes your brand from others. It should guide your marketing decisions. These days, most businesses focus solely on improvement, but customers don’t notice this unless it is brought to their attention. So it’s always better to get the message across.
Previously, we discussed how your packaging design could make your brand stand out. Why not let your USP inspire your packaging ideas?
In the 1960s, Avis popularized the slogan “We’re number two. We try harder.” At the time, they were behind Hertz in the car rental business. Avis’ market share tripled four years after introducing that slogan.
3. Failing to Define the Target Market
Even if your product appeals to a wide audience, attempting to sell it to everyone can lead you down a slippery slope. Narrowing your market down makes promotional efforts more efficient, and the messaging sound more sincere. Also, brands that make customers feel special—like they’re in some kind of exclusive club—have a greater chance of capturing their targets.
Credit: Ford Edsel
The Ford Edsel is a cautionary tale that inspired a Billy Joel song. In the 1950s, 18 different models were launched to cater to various demographics. Rather than convincing more people to buy, it turned into a marketing gaffe that earned the pun “Ford Hermaphrodite.”
4. Lacking a Customer Retention Strategy
Businesses do this inadvertently by delivering poor customer service, failing to show client appreciation or neglecting aftersales marketing. Remember that the probability of selling to an existing customer is 3-5 times greater than converting new ones.
Extracted from Yahoo Finance
Who could ever forget the backlash that United Airlines suffered after mistreating a passenger in 2017? The aviation company lost nearly a billion dollars in the stock market days after that video went viral.
5. Having a Bizarre or Lackluster Logo Design
Among all your marketing tools, your logo is at the forefront. So it is best to have one that will let people remember your brand in a good way. Apple learned this lesson early on. Its first logo was one of Sir Isaac Newton sitting under an apple tree, which people found too complicated and unappealing.
However, sales began picking up a year later shortly after the creators changed it into the much simpler apple emblem that the company is now known for.
6. Overpromising then Failing to Deliver
It’s good to be aggressive about marketing, but never promise more than what you can deliver or it will cost you. You could get your staff hurt, pay extras to appease dissatisfied clients and hurt your brand.
Domino’s Pizza learned that lesson the hard way when it started guaranteeing that their crew could deliver fresh, hot pizza within 30 minutes, or the customers would get it for free. Consequently, many delivery drivers got into car accidents trying to stay on time.
7. Incorrect Use of Market Information
What’s more harmful than not studying the market is using data incorrectly. If you’re inexperienced in research but have some money to spare, perhaps it’s cheaper to hire an expert than to do things yourself and misinterpret customer retention metrics.
Pepsi, a global brand, once suffered huge losses from the big Chinese market by using the English-language slogan “Come alive!” which got lost in translation.
They could have prevented it by seeking expert linguistic help.
8. Inauthenticity of the Marketing Campaign
People are good at picking up insincerity. An insensitive social media comment, tone-deaf ad or poor choice of packaging graphics can take its toll on your brand.
This was the case in 2018 when MasterCard offered to donate 10,000 free meals to impoverished Latin American children whenever booters Messi and Neymar Jr. scored a goal. Turning a serious social issue into entertainment stirred public outrage.
9. Overlooking the Competition
Failing to scout your rivals is also dangerous for business. How will you know if you’re better or different if you don’t watch them? Observe the competition, do a SWOT (strengths, weaknesses, opportunities and threats) analysis and choose which of their strategies will go well with your brand.
Nokia dominated cellular technology in the 1990s, and it seemed nearly impossible to topple it. However, advancements made by its rivals, particularly Apple and Samsung, left it languishing at the bottom decades later.
10. Giving Up the Learning Process
Finally, never stop learning. Trends change and markets are even more fickle. A timely and proper product innovation, promotional theme change or customer service policy modification can always elevate your game.
The American company Dymo is well-known for patenting the embossing label maker. If it had not adopted thermal printing and started producing Dymo labels, it might have lost its status as “labeling king” to its opponents.
Marketing mistakes are costly, but sadly, they are part of growth. The good thing is that history is there for everyone to learn from. Startups can avoid or minimize errors by studying the market, their predecessors and the competition well.