October 14, 2019
The 4 biggest challenges that small businesses face
Like training for the New York marathon or mastering the art of making croissants from scratch, running a small business is hard work. And in the first few years of operation, small businesses are likely to come across many different challenges, usually one after the other. While some obstacles are easy to overcome, others may be harder to solve.
According to the US Bureau of Labor Statistics, 20% of small businesses will fail within their first year of trading. And within 5 years, half of them will cease operations. Those statistics may be scary — but it doesn’t mean that you should be put off by running a small business. In reality, most common small business challenges such as acquiring new customers and finding good people to work for you are actually fixable.
In this article, we discuss 4 of the most common challenges that our small business customers face and provide practical tips on how to overcome them.
1. Finding new customers
From large well-known brands to the little cupcake shop around the corner from your office, all businesses work hard every day to find new customers. But while global brands such as Apple, Facebook, and Coca-Cola have an army of staff and seemingly endless budgets, smaller businesses often operate without those luxuries — and so, finding customers comes with many challenges, including how to get them interested in the first place and which channels to focus your efforts on.
Our tip: So, where do you start? Find out who your ideal customer is. While it’s true that defining your ideal customer can feel like you’re excluding other audiences who might buy from you, narrowing your focus on the right people will bring clarity to your small business marketing efforts, which will eventually lead to more customers and more money.
Knowing who your ideal customer is will change everything for your small business, from your overall marketing strategy right down to your value proposition, tone of voice, and pricing structure. Ultimately, knowing your ideal customer will help you create winning products, powerful messages, and compelling customer journeys, thus steering your small business to success.
2. Driving brand awareness
When you’re ordering a drink at a fast-food restaurant, do you ask for a cola or a Coke? When you accidentally cut your finger while furiously chopping some carrots on the chopping board, do you frantically look for a plastic bandage or a Band-Aid? And when you’ve cooked way too much dinner and need to store the leftovers to take to work the following day, do you look for a plastic container or Tupperware?
The terms we’ve used above are known as proprietary eponyms; they’re also great examples of brand awareness. Essentially, these brands have become so famous that they’ve pretty much replaced the generic terms for similar products (sorry, Pepsi).
Our tip: Getting the word out about your brand is one of the best things you can do to promote your small business. We’re not saying that you’ll become as famous as Coca-Cola but it certainly won’t hurt to try. And while there’s no quick fix for becoming a household name, here are some brand-building strategies that can help launch your brand awareness efforts:
- Blogging: Blogs are great because they help drive traffic to your website but did you know that they’re also good for helping your brand create authority in your industry? By running a high-quality blog filled with interesting, engaging, and useful articles, you’re developing trust among your leads — and driving brand awareness along the way.
- Influencer marketing: Have you ever purchased something because a famous person you trust and admire used the product? Influencer marketing works because it combines tactics such as WOM marketing and social proof, both of which are critical aspects of a successful marketing strategy. Partnering with the right influencers can help your brand inherit some of their credibility and trust while raising brand awareness.
- Referral programs: The likes of Dropbox, Uber, and Airbnb have used referral programs to grow their brand — and we’ve recently done the same with our new Autopilot Partner Affiliate Program. Referral programs reward existing customers for spreading the word about your brand and incentivizing new customers to give your product a go. Referral programs are effective because customers are more likely to spread the word about your brand when they know they’ll receive an added perk as a reward. We know how hard it is to acquire new customers, so why not let a happy team of satisfied customers do some of the legwork for you?
3. Hiring top-performing employees
It’s not easy finding talented people to work for your business — just ask any HR professional employed by a large company. For small businesses, however, the hiring process is made harder because of the lack of resources available. There may not be a dedicated HR personnel, let alone an entire HR department. Therefore, all the hiring decisions are usually made by the small business owner who may or may not have the experience (or time) to find the right person for the job. And if you don’t hire correctly, your small business may face high employee turnovers which may cost you dearly.
Our tip: Most small business owners adopt a short-term mindset when it comes to hiring. But due to the high costs involved in hiring staff (including onboarding and retention), it pays to invest a significant amount of time in the process. Avoid settling for below-average candidates out of desperation; instead, take the time to find superstar employees that you know will always do a great job — and help your small business grow.
4. Generating quality leads
For many small business owners, lead generation can be a time-consuming (and frustrating) exercise, particularly for those without a sales background. Some small businesses struggle with lead generation because their level of effort and their desired outcomes aren’t quite aligned, while others think that customers will simply come knocking at the door after just a few email blasts and phone calls. In reality, lead generation requires a lot of thought, energy, and resources into your sales and marketing strategies. An effective lead generation strategy is the reason why your website visitors will convert into solid leads (and paying customers) — and keep your sales funnel filled with quality sales prospects while you sleep at night.
Our tip: Your business website will be the most important tool you will have for converting leads into paying customers. Therefore, a good place to start is to optimize your website for lead generation. Conduct a quick audit of your website, asking yourself the following questions:
- Do your pages compel your readers to take further action? If not, your potential leads may be wondering what they should do next — or they might simply leave your website.
- For every campaign that you run, do you have custom landing pages and a way to track visitors (for example, via UTMs)?
- Do your blog posts have clear calls-to-action to encourage your visitors to do more than just read? (for example, “subscribe to our newsletter” or “try our product for free today”)
Be sure to also take advantage of lead generation tools to make your job a lot easier. Good marketing automation software such as Autopilot will help you design multi-channel lead generation strategies with your website landing pages and forms along with emails, SMS, Facebook and Google ads. The journey below shows you how you can use your website’s pricing page to generate (and qualify) leads and automatically reach out to those who have visited the page more than once within 30 days via email and Headsup messaging.
By amplifying content through multiple marketing channels, your small business will have a stronger chance of finding new leads and prospects.
The road to small business success
The worst thing you can do as a small business owner is to go into business without considering the above factors. We’ve explored some of the most common difficulties faced by our small business customers and provided tips to help make these issues easier to overcome. To recap:
Challenge 1: Finding new customers. To overcome this problem, we suggest working to identify your ideal customer — focusing your efforts on the right people will bring clarity to your small business marketing efforts, resulting in more customers and more money.
Challenge 2: Driving brand awareness. Getting the word out about your brand by executing brand-building strategies such as blogging, influencer marketing, and referral programs will help you get the word out about your brand.
Challenge 3: Hiring top-performing employees. Due to the high costs involved in hiring staff (including onboarding and retention), we recommend taking the time to find superstar employees that you know will always do a great job — and help your small business grow.
Challenge 4: Generating quality leads. Your website will be the most important tool you will have for converting leads into paying customers, so consider conducting a quick audit to ensure it’s optimized for lead generation.
However, there are many other challenges out there that we haven’t discussed. Do you run a small business? What other challenges is your business facing and how are you working to overcome them? We’d love to hear from you! Share your insights in the comments below.