Avoid the danger zone: 5 online don'ts for small businesses

5 Online Don’ts For Small Businesses

Cliff Danger--5 online don'ts for small businessesOnline Don’ts–The 5 Biggest Mistakes Small Businesses Make Online

What are the biggest online don’ts? One of the biggest mistakes I see with small businesses and their online marketing is putting the cart before the horse–that is, doing things that simply should not be done without a solid foundation. There are five online don’ts I see time and time again, and they are simple mistakes to make. In fact, many small businesses think these five things are the solution to getting new clients, and building their business. Not so at all. These five online don’ts can seriously hurt your long-term plan and make current customers angry.

I know, it’s exciting to launch a business and you immediately want to get the word out and drive new clients as fast as possible. But taking a step back and truly looking at what you hope to achieve online, and creating a solid strategy is going to save you time and money–and it will surely bring better results. Most small business owners would agree that growing their business and getting more revenue is a good goal. Yet, all of us make mistakes that are sometimes a result of over-excitement (just opened and want the world to know!), cash-flow problems (needing revenue right now, and forgetting the big picture), or the most common, is simply not knowing what truly works for online marketing.

If you absolutely know that:

  • 5% of your website visitors buy something or book an appointment
  • 10-25% of your social media followers refer you, share your posts, or participate in conversations with you
  • 5% of your ads actually lead to an end goal
  • 50% of your customers are repeat customers

Great! You can optimize what you are doing, and continue to get the end results you are striving for.

Did you answer “no” to any of the above?

Stop what you are doing right now and read the rest of this blog.

The 5 Biggest Don’ts (if you don’t have all of the above statistics)

  • Paying for ads on Facebook or Google Adwords
  • Paying for an SEO consultant
  • Diving right into social media
  • Using “deal” sites to drive many customers into your business
  • Spending more time on getting new customers, instead of paying attention to current customers

Online Don’ts–Why?

1. Paying for ads

This is an online don’t until you have those key metrics I mentioned above. Why? Because unless you are running A/B tests and optimizing your ads and continuously modifying them to ensure the most targeted results…you are wasting money. And unless you are spending $5k instead of $500, you are most likely not able to actually even get the numbers you need to really make a difference. The way ads work is you need to test dozens of versions of your ads–the copy, the design, where you are linking to–and that typically means a fairly big budget for the first 4-8 weeks. I do not recommend doing this until you are getting results from other sources of online marketing first.

And as a note for ads, be careful when doing ads to understand what kinds of ads do you more harm than good. A latest trend right now is “sponsored posts” on Facebook. I’m going to write a blog about this specific thing next week, but in my experience with running social media for many companies, sponsored ads do not have what is known as a good conversion rate (meaning not many new people like your brand as a result, or buy/do something positive as a result of seeing the sponsored post), AND, they tend to (to be frank), piss people off. Ads can do more harm than good, so just like anything online, you want to think through your end goals, your strategy, and be sure you are doing it correctly. Otherwise you are better off NOT paying for ads.

2. Paying for an SEO consultant

SEO, or Search Engine Optimization is a big thing for small businesses, since we often rely on search engines such as Google to drive free traffic. But using an SEO consultant is a big online don’t, in my opinion, for most small businesses. I’m building out a training module that will show you how to do better SEO than most consultants, but until I create that, I will give you a few tips right now. The reality is that consultants don’t understand your brand, and they have to spend time getting up to speed. A good consultant needs a lot of time to understand your brand and get up to speed with your business–and that’s a lot of hours at a high consulting rate.  You actually know your own keywords better than they do because you know your top services, your clients, and why what you offer is unique.

Here are some quick tips for getting together ideas for keywords for your business: 1) Your special sauce–the thing you do that is unique or different, such as pilates + nutrition, are the best keywords you can use. 2) localization–be sure to include where your business is, including the neighborhood. You want to be as specific as possible. 3) Your top services right now, these are things your current clients like, and there is a high chance future clients will like them too. Using words around those three things in your blog, Website, social media, etc., is going to get you the right kind of traffic. SEO seems more complicated than it is, but the tips I just gave you will get you some results, and if you sign up for my mailing list I’ll let you know when my training module for this is live. You really can do this yourself.

3. Diving right into social media

Another top online don’t! Unless you have a plan. Social media is a classic “cart before the horse” since it seems simple to do, right? Everyone wants to dive right into social, but like I described in my blog post two weeks ago, social media without a solid foundation is just a lot of talk that won’t drive business. I consistently see small business owners spending a lot of time on social media, but none of their efforts point to the bottom line–did a customer book an appointment or buy something as a direct result of your social media? Social media can drive awareness of course, and it helps with your SEO and driving traffic. It’s also a great place to have conversations with current clients. But if you don’t have that solid foundation to truly understand what your goals are, the content strategy (what you will write about, why you are writing it, and when you will write it), AND a solid social media strategy; I guarantee you are better off focusing your efforts on other things, such as your Website, or building an email mailing list.

4. Using Deal Sites

Deal sites is a big online don’t and a personal pet peeve of mine. I see a lot of small businesses doing deals on Gilt City or Living Social or Groupon. In my experience with small businesses that rely on customer loyalty, these deal sites can be dangerous on two main accounts 1) trapping you into a less-money-per-client situation, which in the long run is going to hurt the business and 2) making current customers angry, since they pay full price despite being loyal. The reality is, most of these customers who come to you on a deal are not going to become long-term clients (the highest ratio I have seen is about 30%, meaning for every 100 people who buy a deal, 30 come back to you when the deal is over). That’s a really low customer return rate.

The other problem I see with this, is that when you put together your business plan, you thought about the true cost of a service or a product, and you (I hope) ensured a good profit for yourself. If you run a deal, the problem is you’ve now set an expectation for all clients to only pay that much–and I’ve seen a lot of businesses fail because they simply aren’t making enough money. There is a huge difference between running specials, or promotions that apply to new and current customers, or running a referral program where if a client refers a few people they get a big discount, and these deal sites. I KNOW that if you are starting a business, and you are concerned about getting new clients, or paying the rent on your space, these deal sites can be tempting.

You are much better off looking at partnerships or referral plans. Don’t worry–I’m going to create a training module that addresses getting new clients in quickly, and getting cash-flow, but my recommendation is to do everything with the long-term goal in mind, and that is a loyal customer rather than someone looking for a deal. But for now just remember the big picture. What kind of customer do you want? Do you want someone who only thinks your business is worth 1/2 off? Or do you want a loyal customer?

5. Spending more time on new customers instead of current customers

This don’t is related to the previous four, because most of the time, small businesses are using deal sites, using SEO, paying for ads and using social media in an effort to get new customers. Your current customer base is the #1 most important thing you should focus on with anything online. Your current customers already love you, so sending them love is the right thing to do. 🙂 One of the most important things you can do right now is establish a loyalty program–and this doesn’t need to be complicated at first. Simply tell your current customers that when they refer their friends and family to you, they get a discount.

An example of this is at my hair salon. For every three new paying customers I refer, I get a free haircut. Awesome.  This is a huge incentive to me to let people know about my hair salon, and, it’s a great way to keep me excited as a client. Friends who are referred to businesses tend to be loyal clients as well. It’s a win-win for everyone. My hair salon doesn’t do this online (yet), but they send email newsletters to their current customers and track it all manually in their database  (if you are dealing with thousands of referrals, you’ll want to set up a system for this, which I will build a training module for in the next few months). This is just one example of sharing the love with a current customer base, and it is easy to do.

VERY few businesses do this, and it always surprises me. The reality is, the more attention to give to a current client, the more they are likely to book an appointment with you or purchase something with you as well. The more you give, the more you get. There’s also a flipside to giving incentives to new customers only–it tends to make current customers unhappy, just like with the deal sites. I just saw a Facebook deal the other day for a business I’ve been a client of for five years. The deal was 50% off a service for new clients. No deal for current clients. Why not? I looked at the post and saw a lot of angry comments from current customers (all these comments were ignored by the business, another “no”), and some of the current customers went so far as to say they would reconsider giving business to the company. To state the obvious: this is not a good thing. Give the love to your current customers first, and give them incentives to bring in new business for you. That’s the better way to build your business.

I hope these five don’ts were helpful for you. Have you done anything with your business that you wish you hadn’t in hindsight? What do you do with your business that has really worked for you? Let me know in the comments!