How I built a business. How it failed. The Lessons I learned. Pt3
“Failure is just another steeping stone to success.” Oprah Winfrey
“I can accept failure, everyone fails at something. But I can’t accept not trying.” Michael Jordan
In this spirit lets examine where things went wrong for me and my business adventure.
I think my biggest mistake was my initial budgeting. I grossly underestimated the amount I would need for the website itself, and also the marketing campaigns, which combined to leave me struggling for funds. The marketing budget in particular was pretty much an afterthought, I naively though I could grow my business organically through social media and word of mouth, whilst also gaining some space in a store or two to help. Bristol has a bunch of independent fashion traders that will take on small labels if they appeal, but I tried and failed to get into these early on which starved me of valuable exposure.
The poor budgeting left me with virtually no money with which to launch a sustained marketing plan. I think I used the money I had in the right areas and used targeted advertising strategies to reach my chosen demographic, but I just didn’t anticipate the sheer amount of money it takes just to drive people to your unknown site. The flyers, the competition, the social media ads and the promotional key rings, were all good ideas that generated traffic and interest, but they require large budgets to keep them running over months, not weeks.
My website oversights were the primary reason my budget suffered so badly. It took over a third of my budget to get up and running. My mistake here was to grossly underestimating the work needed to get such a site together. For some reason I though I could do a lot of the work or find someone to do it on the cheap – this was foolish and costly. Obviously you need a high quality site from which to trade otherwise people simple wont trust your site or buy from it, so this wasn’t money wasted – if was just unplanned.
I should have foreseen the expense and perhaps borrowed slightly more to accommodate for this.
Also I was dead set on having a bespoke e-commerce store built specifically to my design. This, again was foolhardy as there are numerous, ready made trading platforms and firms. These will produce a professional e-store for a fraction of the cost I spent. Such template sites would have been efficient and professional but I wanted a kooky mascot in the corner of the page, I wanted a fancy homepage, I wanted to decide on the precise layout for every single bit of text. I wanted bespoke and didn’t even consider anything else. Perhaps using a ready made platform to get me up and running and then switching to this more bespoke site someway down the road, would have been a much better idea? Thus saving me valuable money to invest in marketing.
Testing the market
Now the smart thing to do, and I knew this at the time as well as now, is to test the marketplace first before launching a product. I didn’t even try to sell a single t-shirt before I secured the loan – I didn’t set up a free e-bay store and test my designs out beforehand, I didn’t trade from a small market stall, I didn’t research a gap in the market to exploit. I liked my designs so other people will I figured.
This gun-ho approach was incredibly naive. I wanted to do this and I would make it work, I was too excited by the possibility to stop and test for road blocks. There was a small part of me that knew, if I put a few designs up on e-bay first and they struggled to sell – there was no point in going ahead and borrowing the money. I could have found out for less than £100 if there was an appetite for the products I was creating, instead of borrowing £2000 to realise this. Perhaps very silly in retrospect but hindsight is a wonderful thing.
So what is the take away from all this? What will I do differently next time I decide to embark on such a scheme?
Preparation is the key.
A big lesson in all this was preparation and planning. I did the very minimum in terms of prep and research and as mentioned didn’t even test the market beforehand. Make sure there is a gap in the market or a desire for your product first, before you jump in with both feet. If your testing is successful, plan and plan and plan again before you launch.
My youthful zest and enthusiasm got the better of me and I steamed full ahead without the necessary level of planning and foresight. I should have foreseen the website issue and the lack of marketing budget and budgeted to accommodate them. Fail to prepare – prepare to fail, goes the old saying and I found that out the hard way.
Get some help!
I naively planned to do everything myself. This was insane given my novice level of coding and my complete lack of marketing experience. I should have been prepared to bring in website developers, perhaps sought some freelance marketing advice from an expert. It is the sensible and successful thing to do, to outsource things that you are not really proficient in – I’ve learnt that the hard way also.
It takes time
Nothing happens instantly, nothing springs into a success overnight. My poor budgeting and planning lead to me being restricted to a single years worth or trading – not even remotely close to being a adequate time frame to allow this unknown company to establish itself. Such success takes years of sustained effort to attain and the year of trading I undertook was merely foundations. I should have anticipated a slow start and a long build, I should have allowed for this and budgeted accordingly, I should have kept the site afloat and drip feed marketing money in as and when I could. Success is built over years – not months.
It turns out it is incredibly hard to get noticed on the internet! The limited money I spent on advertising was simply just to get people onto the website in the first place, convincing them to buy something after that was another matter. Just getting eyes on your new site is extremely difficult and costly. I’ve learnt that marketing a brand new company, generating traffic and getting hits on a brand new site is an expensive game. Getting noticed in the vast din of the internet is a constant and endless battle that I wasn’t prepared for at the time.
Full time distractions
Perhaps the biggest lesson I’ve learnt from all this is that you have to commit all your time and energy to a fledgling company like this in able to build it. I had grand ambitions to build a successful online company that I could grow in my spare time, eventually developing it into something that would sustain me full time whilst I pursued my writing career. This was fanciful and un-realistic (I told you I’m a dreamer). Something like this requires full time work, constant effort and attention – I should have been trading on a market stall everyday whilst also selling on-line, I should have been dedicating hours of analysis and research into online marketing channels and their effectiveness – it should have been my full time job but I already had one of those!
So that folks, is the sum and total of my adventures into entrepreneurship. A hardworking, rewarding, but ultimately doomed adventure. One that taught me a great deal and re-calibrated my expectations, one that I take great pride and satisfaction from despite the modest results. Time and money was invested, but not in vain, I am a more rounded, realistic and ambitious fellow because of it. I’ve made mistakes and learned some valuable lessons.
In the mean time – anyone wanna buy a t-shirt?