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 those survival rates, it’s easy to see why folks face the first few years of business with trepidation. But, many common business problems and challenges are actually fixable. Many times, you’ll find you need to take a step back, assess your pain points, and rethink your strategy.
In this post, we’ll discuss common challenges that small businesses may face, along with tactical advice about how to fix them.
Common Small Business Problems
- Finding Customers
- Increasing Brand Awareness
- Building an Email List
- Lead Generation
- Delighting Customers
- Hiring Talented People
- Managing Workflow
- Financial Planning
1. Finding Customers
This first one isn’t just a small business problem. The marketers at well-known companies like Apple, Toyota, and McDonald’s 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, the challenge is even more significant. How can you find customers when you’re not a household name? And, there are so many channels to focus on for acquisition, but how do you know what to prioritize?
In addition, acquisition costs are incredibly high, and small businesses may not have the same spending power as larger, more established businesses. In fact, the cost of acquiring new customers has increased almost 60% over the past six years. If this is something you’re struggling with, you’re not alone: 49% of companies report that customer acquisition is their primary marketing objective.
How to Fix It:
Finding customers starts with figuring out who your ideal customer is. Spraying and praying doesn’t work for anybody — you need to make sure you’re spreading the word to the right people.
Craft an idea of what your target customers look like, what they do, and where they spend time online by building your buyer personas. This free guide will walk you through the process and provide customizable templates to fill out and create representations of your ideal customers.
Creating very specific templates can dramatically improve your business results. Once you’ve built your personas, you can begin creating content that caters specifically to your target demographic and share it in the channels you know they’re in, with the messages you know they care about.
2. Increasing Brand Awareness
If your customers don’t know who you are, how will they buy from you? Statistics show that, in terms of success, 70% of brand managers say that building an audience is more valuable than direct sales, and, because of this, marketers in 2021 say that their primary goal for running marketing campaigns is building brand awareness.
This focus is largely because building brand awareness helps generate trust with your audience, helps them associate your brand with your products and services, and those factors combined help drive sales and build a base of loyal customers.
As a small brand, it can sometimes seem like today’s biggest names 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, and rejections happened behind the scenes. But, there are strategies for spreading the word about your brand and building an excellent reputation that you can start using right away.
How to Fix It:
- 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 and small businesses often get wrong about PR. The piece also includes some tactical tips on how to figure out who’s covering your industry, building relationships, and working with reporters. You can also download our free public relations 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 and reputation and create brand evangelists outside your circle. It’s a fantastic way to gain a large volume of new contacts alongside your organic marketing efforts. You can read our ebook on how to get started with co-marketing for more helpful information.
- Blogging: Running a consistent, high-quality blog will also help you build brand awareness. Not only does a blog help drive traffic to your website and convert that traffic into leads, but it also enables you to establish authority 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
To move prospects along their buyer’s journey to eventually become your customer, you need to build trust through consistent nurturing, staying top of mind, and continuously providing value. Marketers say that one of the best ways to do this is by getting prospects on your email list.
Email marketing is still ranked as the most effective marketing channel, and for every $1 you spend on email marketing, you can expect an average return of $42. In addition, 59% of consumers say that marketing emails can either directly influence their purchasing decisions.
Despite these statistics, the average email marketing database degrades by about 22.5% each year. As a marketing team, it is your job to find ways to maintain and constantly add fresh, new email contacts to your list.
But, what many people call “building an email list” is 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 and IP reputation be harmed, but it’s also a waste of money. If your current strategy is to buy or rent email lists, it’s time to regroup 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. These customers are already interested, and interested customers are more likely to make purchases, especially with nurturing.
The act of opting in necessitates website functionality that captures their email address. You can achieve this with a form builder or other conversion tool (more on that later).
You can also leverage social media platforms that you know your audience is already on, like Facebook or LinkedIn, and create enticing content that inspires them to sign up for your email list.
The other piece of the puzzle is creating demand. As mentioned above, you can do this by creating great blog content and making it easy for people to subscribe. In turn, blogging will help you increase your online presence, build up search authority, and create evangelists from your content.
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 increasing your list of sales-qualified leads, which brings me to my next point…