In 2007, Nokia boasted a 48.7% mobile phone industry market share. Today, it is the poster child of meteoric business failure. Nokia stuck to hardware despite knowing about the growing need for software. It failed to innovate and adapt to the changing market. While Nokia was a household name before it slipped into negligence, some startups don’t even see the light of the day due to a lack of business startup strategies.
Building a successful business is no cakewalk. If you don’t want to avoid the same mistakes, read this article for good business startup strategies.
Business Startup Strategies You Need To Implement
According to the Union Budget Economic Survey 2021-2022, India is the third-largest ecosystem for startups, with 107 companies in the unicorn club. However, 90% of Indian startups fail within the first five years.
Here are eight business startup strategies to ensure your business runs smoothly.
1. Define Your Business Vision
Determining where you want your business to be will give your business direction and focus. For example, BoAt, a consumer electronics brand, has the “sole aim of bringing affordable, durable, and more importantly, 'fashionable' audio products and accessories to millennials.” Their vision is to bridge the gap between fashion and electronics.
As a startup, your first step should be to have a clearly defined vision. It will help motivate your team, instil trust among investors, and give customers a way to connect with your brand.
Consider where your business will be in the next 5 to 10 years to create a vision statement. Identify the goal you want to work towards.
2. Understand Your Target Audience
Target audience refers to people who are most likely to buy from you. For example, Sugar Cosmetics co-founder Vineeta Singh targets GenZ and millennials who want paraben-free, cruelty-free, sustainable, and inclusive makeup products.
If you target the wrong group, you’ll waste time and money on people who are not your ideal customers. So, zero in on your target audience to optimise your marketing campaigns.
Ask the following questions to define your target audience:
1. What are the unmet needs of your potential customers, and how can you meet them?
2. What are the specific issues and challenges they are facing?
3. What are some solutions they wish they had?
3. Analyse Competitors
Competitor analysis is the process of assessing the strengths and weaknesses of your competitors. It is crucial for startups as it shows how you can stand out. You'll be able to show investors your competitive advantage over your competitors.
Consider these factors while doing a competitor analysis:
1. Study the characteristics of their product or service. This will enable you to identify methods to improve your product or service.
2. Analyse your competitors' pricing strategies to understand how to set your prices.
3. Study the sector to identify how your company differs from the competition. This will help you understand how to position your company in the market.
4. Set Goals for Your Startup
Goal-setting is crucial for every startup as it gives direction, reduces confusion, and increases team productivity. As a founder, you should set three goals — for yourself, your team members, and the organisation. For example, your goal can be to define your business vision or find a co-founder.
Next, set goals for your employees. For example, a digital marketer should aim to increase website traffic by 25%. Setting employee performance goals will benefit the organisation and make employees accountable.
Additionally, set goals for the entire organisation to ensure everyone works in the right direction. You could have product-related goals, hiring goals, financial goals, etc. These will depend on the stage of your business and your vision for the company.
5. Focus On Sales-Generating Activities
Good sales are essential for the financial health of a new startup. And focusing on sales-generating activities will help drive your sales performance.
One of the activities that you should focus on is marketing. Building an effective marketing strategy will help you reach potential customers and position your product in front of them. You can start with organic marketing through social media and SEO. Or you can use paid media to acquire leads and sales. A business exists when it is making a profit. Hence, as a startup owner, your focus should be on sales-generating activities.
6. Set up Key Performance Indicators
Key performance indicators reflect the performance of a business and areas that need improvement. They help measure a startup's growth and estimate the company's financial future. For example, the customer acquisition cost is a key performance indicator that shows the cost of acquiring a customer.
Additionally, setting up key performance indicators for your startup is crucial because they help gain investors' trust. They showcase your financial future to investors and help them decide whether to invest in your business.
7. Do a SWOT Analysis
SWOT analysis means identifying your strengths, weaknesses, opportunities, and threats. It is a tool that will help you understand the business landscape, your problems, and potential solutions. It is also used for new product launches, starting a new business, solving a business problem, or increasing market share.
Some instances that you can identify with SWOT analysis are:
1. Strengths - good team, high-quality product, effective marketing strategy
2. Weaknesses - operational inefficiencies, poor user interface, low turnover
3. Opportunities - new market, competitor gaps
4. Threats - excessive competition, the low entry barrier
8. Pivot Your Strategy When Necessary
A pivot is a fundamental change in the course of a business when it realises its current products or services aren't satisfying the market's needs. The primary purpose of a pivot is to help a firm increase revenue or survive in the market, but how you pivot your business can make or break it. While pivoting a business might revitalise an otherwise dormant one, it also requires starting from scratch.
If Nokia had pivoted its strategy when the market demanded it, things might have been different. That said, pivoting your business should only be done when absolutely necessary.
It may be the right time to pivot your business if:
1. You don't see any improvement despite spending a lot of money and resources.
2. There's simply too much competition.
3. The company's growth has slowed.
4. Only one of your company's features or services gains traction.
5. Customers aren't responding to your products as you expected.
6. Your perception of the industry has shifted.
Implement These Business Startup Strategies Today
Every startup needs solid strategies to bring it closer to its goals. The strategy outlined above will help you build a strong foundation for the sustainable growth of your business.