If you have an idea, as well as the stomach and the right mindset for it, you'll want to be aware of a few common mistakes on your journey as a startup. Here are a few that you should avoid at all costs if you want to efficiently scale your business to substantial growth.
Mistake #1: Overbuilding the Initial Product
You're probably excited about your new idea, and as you develop your product or service, it can be straightforward to get carried away. Of course, there's always going to be a list of things you think you need to do, but most are unnecessary items and tasks you don’t need.
If you listen to all of these unnecessary items, you'll end up with a product that has so many options that can leave you in a position where you're not sure if what the customer or dislikes, what works and what doesn't.
To avoid this mistake, create one concept at a time. Keep it simple, and you will get the feedback you need to adjust accordingly, rather than having to change multiple things at once and potentially encounter many challenges that you could easily avoid otherwise. You have plenty of room for growth after a great initial concept.
Mistake #2: Assuming You Have an Idea People Will Buy
You might be so excited about your product that you make the biggest mistake of all: seeking validation from friends and family about your idea and understanding whether people would swipe their credit card to buy it.
You need to be careful because friends and family often have altered perceptions of reality, especially when it comes to ideas that you might have because, well, they like you. Sure, you can ask them to pay in advance for the product but that’s not going to be super helpful given their bias. Instead, focus on finding outside consumers to test on – crowdfunding is a great way to accomplish this, which is possible whether you’re selling a physical product or service.
Mistake #3: Not Understanding the Margins
This is one of the biggest issues we see consistently inside early-stage businesses: there is not a clear understanding of how the company makes or spends money, how contribution margins work within the company, how marketing dollars are being deployed, and at what level of efficiency is required to get the company to profitably scale.
There are several tips and tricks that we have developed to help you understand how your paid media spend is working, as well as how it could be improved with additional clarity and tactical guidance. Click here for more...