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Year One Is the Biggest Challenge for a New Business
According to the Australian Bureau of Statistics, over 60 percent of small businesses will fail in the first three years of trading.
Why is this? There are a few reasons. For starters not all business ideas are good ones; sometimes, no matter how much effort you put in, it’s just not going to work. Another major factor is cash flow; a business might simply run out of capital before they get going. But for many businesses, the most significant challenge to success in the early years is customer acquisition. How do you find and retain the people who want to buy your product or use your service?
Here are four super strategies for finding your audience:
1. Objective market demand analysis.
The first step is finding out who wants to buy your product or use your service. You may think you have a great idea but how do you know if there’s a market for it? Conducting some market research should help you find out if you have an audience who wants what you’re selling. If you have a large potential audience, it follows that your business is more likely to flourish.
Take the following steps to find out:
Desk research – You should get a good picture of your market from asking Google. Scope out the competition, find some recent financial reports about the status of your chosen sector and conduct a keyword search. Another excellent tool to get you started is Alexa, an Amazon program that helps you identify your digital audience.
Deep dive research– Start asking potential customers about their needs to get an overview of how useful they find your product or service. Research can take the form of:
- Surveys– A great way to get some probable audience intel and can be a marketing tool in itself. Encourage people to complete by offering an incentive.
- One-to-one in-depth interviews– Discover audience motivations by interviewing potential customers face-to-face.
- Focus groups – Ask a pre-qualified group of people to sit down and discuss your product or service; it’s possible you’ll discover some incredibly valuable information.
2. Narrow down your audience.
One problem for new businesses is starting out with a potential audience that’s too broad. In today’s competitive market, finding and keeping a niche audience is the key to success. Go deep and narrow down your audience to find the people who will most likely be your loyal customers and brand champions. Here’s why:
- There will be less competition; niche usually means they’re all yours
- It’s a more efficient way of delivering your marketing message; you’ll be talking directly to your potential customers
- It will position you as the expert; if you identify your audience correctly, you’ll have the solution to their problem.
3. Choose the right marketing platform.
Find out where your potential audience is and what social media platforms they’re using. Before you spend hard-earned dollars on advertising, make sure you’re speaking to the right people. There’s no point in splurging 25 per cent of your advertising budget on LinkedIn pay per click (PPC) ads when your future audience is spending most of its time on Instagram.
And it’s not just about advertising; it’s about communicating with your likely audience using the right content. Do they watch videos or listen to podcasts? Would you benefit from showcasing your products or services on Instagram? It all comes from identifying the correct comms channel.
4. Experiment with split testing.
Maximise your marketing messages through website experimentation. Split testing means splitting your potential audience in half and sending them two different messages from your website. Keep tweaking until you find the most successful one. You can do this with:
- Calls to action.
- Ad copy.
- Landing page copy.
- Conversion offers.
Follow the above strategies, and you should be ahead of the game when it comes to the first year of your business. Leave the 60 percent failure rate behind by doing some smart research and experimentation.
“The opinions expressed by Smallville Contributors are their own, not those of www.smallville.com.au"
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