Online businesses are the easiest to begin with. The availability of an open platform with a wide range of audience who are readily available on the internet allows every idea to nurture and grow. The urge for people to become online entrepreneurs have never been so high. Taking the simple problems that people face everyday, this young brigade is turning them into big or small startups with their simple solutions.
Uber, Airbnb, Snapchat… the list goes on and is ever increasing. Each day a number of new and small startups emerge with different business ideas. While some are able to keep up with the fast moving and quick-changing business environment, most of the startups fail to carry on for too long, as opposed to the big startups.
It has been seen that most of the failed small startups lack two vital elements for business; 1) A powerful business strategy and 2) a strong will to keep moving forward.
Ecommerce is a booming market. The increasing penetration of internet throughout the world has made online business more of a trend. The availability of internet on mobile devices has given a further push to the already thriving online market. In this era of digitization, creating an online business is easy. But surviving in the online market is a challenging task. But it is the same market that drew out big names like Alibaba, Amazon and Uber.
Creating a powerful business model for small startups and sticking to it is the main fundamental that can help you making it big in the competitive world. However, though you might be brimming with ideas, you need to ask yourself few questions before you put your business online.
Is your market ready
You have a unique startup idea that nobody else has even thought of. But is the market ready to take in your idea at large? Are they willing to sacrifice some of their valued online space to give place to your idea?
Understanding the market and its pulse is an important factor that you need to look into even before you start working on your idea. Study your competitors well and understand their workings. Monitor the way they promote themselves. Keep a track of your competitor’s social media profiles. When you create a product it is mainly because you like it. But is not always necessary that the market will accept it. Study reveals that almost 75% of the small startups fails even before thay are fully online.
The main reason for the failure of small startups before its launching stage is poorly managed marketing or ill execution of strategies. For example – Geode was one of the first digital payment wallets that had launched in collaboration with Apple. However, the app was created in such a way that it could be used in iPhone 4s only. Once the next version of iPhones were launched, Geode was unable to update itself. This ended in total startup failure.
From this case study it is clear that the creator had not made a detailed study of the market and its collaborators. While the startup was successful in its initial phase of launch, it was not flexible enough to fit in the changing market. It thus failed as it rendered useless for iPhone 5 users, and the evolving market.
Is it the proper time
Time plays an important role when it comes to launching a startup. It is often considered as the point of make or break for a business. A business launched at the right time in the right market to the correct group of audience is bound to earn revenue.
However, it is not simple and timing the business launch accurately is a challenging task. Too early a launch may render a product useless as people will not be able to understand its use. Too late a launch, and your market will already be filled with competitors. Thus you would fail to carve out a niche in the market.
Studying the market and the psychographic behaviour of your target audience is the key element of research that would help to determine whether it is the proper time to launch your product. The technical and technological quotient of your audience should be a necessary determining element for your business launch.
The importance of timing in case of small startups can well be understood with the following case.
Friendster was a social networking site that came into existence much before Facebook or Orkut was launched. However, this social site failed to understand the market too well. The audience that Friendster targeted was not yet ready to share their personal lives online. This was in the year 2002. 4 years later when Facebook was opened to the public, it became an instant hit. In this case time was a major factor that led to the failure of Friendster while the same made Facebook one of the most popular social networking sites.
Is your audience ready
The biggest question that you need to ask when you commence with your startup is about your audience. Ask this question and try answering it in details. If you are able to understand your audience’s temperment, you can easily make out what their reaction would be towards your product or service.
Once you know this, you can then decide whether to launch the business or not. The audience for small startups also includes the economy of the market that you target. For example- the product that you want to sell can be for a particular demography, industry specific or it can be universal. It can also be geo-location specific.
Thus you need to study the audience and its behaviourial pattern to understand whether your product would really be of use to them. Follow the business trends that are currently the hot topic for your audience.
Often the small startups start by launching a great product. However the audience might not be ready to use it thence. If you are planning to introduce a never seen before product, you should also be ready to gulp down the odds involved.
For example- CrunchPad was the first tablet that was introduced in the market. However, the product never got its chance to have an official launch. The startup was dead even before it came into public view. The main reason was that the audience was not ready for such a product. The business suffered huge losses resulting in going down not to be seen again. This can be treated as a perfect example to showcase that audience would not always accept out-of-the-box products easily. Entrepreneurs and small startups should be ready to face the high risk that comes with the launch of a new product as the returns, if the product is successful is exponential.