When you first launch your business, you want to make a good impression. When you have just enough money to pay for basic expenses, however, making that great first impression can be more costly than you can afford. Learning about the areas in which new entrepreneurs spend too much money can help you better plan your budget for a successful future.
Untargeted Online Advertising
Advertising is a must, but many new business owners buy online ads without knowing their target market, which is the group of people most likely to buy the product or service being offered. Companies that sell premium ad space, including Google, Facebook, Pinterest, and Twitter, charge a lot, and their charges can eat up an advertising budget at a rapid pace. When you don’t know who needs to see your ads, those ads can end up displayed to random people who don’t care about your products or services.
Use your advertising budget wisely by understanding everything about your ideal customer including gender, age, interests, location, and income bracket. Targeting your ads specifically toward this audience makes it more likely that they’ll be receptive. To get the most out of your online advertising budget, learn how to use online advertising interfaces or be prepared to hire someone who does.
Pricey Business Cards and Brochures
Printing four-color marketing materials can be expensive. When you launch your business, you may not yet know if fancy business cards and brochures will have an impact on your sales. Instead, print basic business cards and brochures. Invest your money instead creating a robust website to increase your visibility in the marketplace.
Expensive Office Space
Top-floor waterfront office space might be enticing, especially if you have a lot of cash when you first launch your business. Unfortunately, paying the rent or mortgage could burn through most of your budget and even put you out of business prematurely should your business take a while to generate revenue. Expensive signage also uses up a lot of money that might be better spent elsewhere when you’re new in business.
To keep your expenses low, look for inexpensive office space on a quiet street, and make minimalist choices when it comes to signage. Consider moving in to a co-working space shared with other companies. These flexible workspaces, currently trending in the UAE, are ideal for entrepreneurs who want all the amenities of a full office while keeping a close eye on the bottom line.
Someone Else’s Email List
Consumers sign up for email lists for two reasons: They like the product being offered, or they like the brand making the offer. Because email lists are so personal, it’s almost impossible to achieve success buying someone else’s email list. New business owners make this mistake time and again, paying sellers big money for their lists. The only way to develop a list that drives conversions and sales is to craft well-thought-out, highly targeted offers and sign up prospective customers one at a time.
The excitement of launching a business might make you want to spend a lot of money on things that look good but don’t increase revenue. During your first year in business, think carefully before making expenditures that won’t bring customers in the door.