I would like to preface this article by addressing the potential "threat" of the emerging AI market and how it may impact the way we provide solutions to our clients. Throughout my 25+ years in the branding and marketing industry, I have collaborated with thousands of clients who had transformative ideas or solutions but ultimately failed due to a critical error that could have been avoided.
While there may be other factors that contribute to a service-based company's failure, I have chosen to focus on the following based on my experience. They are in no particular order, as each carries its own weight as a potential point of failure.
Lack of understanding of their audience and their pain points, which could motivate them to make a purchase.
Attracting the wrong clients or none at all in some cases due to messaging.
Using someone else's success playbook instead of creating their own unique approach.
Inconsistently staying in their own lane.
Taking shortcuts or implementing hacks instead of embracing important growth opportunities.
Always building or strategizing, but rarely executing or focusing on cash flow
Inability to create healthy boundaries with clients, especially for coaches and consultants
Allowing themselves to become distracted by other projects.
Not able to pivot in their marketplace their offering.
Lack of understanding of the value of their time or the time management skills required.
Overconfident about the unique value of their product or service.
They have a big vision, but lack the ability to focus to bring all the critical pieces into reality.
The recent polls on small businesses may seem bleak, but they fail to factor in many other variables that may compound the reality of the situation. Nevertheless, it is important to acknowledge these statistics as they ground us in reality.
Here are the statistics on small business failure rates:
In the first year of the start-up phase, 18-21.5% of businesses fail.
In three years, about 40-50% of businesses will fail.
In five years, about 50-62% of businesses will fail.
Finally, in ten years, about 62-80% of businesses will fail.
These numbers show the sobering reality of being in business. It is not always because the services were not needed, but often because of how they were positioned to the audience.
Now, I will address these statistics in no particular order, but I will summarize each one to provide greater clarity into the problem.
Houston, we have a failure to launch. This is a major factor, especially in branding and marketing. According to research, at least 29% of all businesses fail because they don't know how to manage cash flow. They become so focused on investing in building or strategizing their great ideas or solutions that they fail to execute with the audiences they originally created their solution for.
Instead of striving for perfection, I would advise launching and testing the service or product once you've developed it 60%. Your offering doesn't need to be perfect to have a big impact. Focus on smoothing out any rough edges and perhaps offer a reduced fee for acquiring the data necessary to make future improvements. Work on balancing your strategy with 90-day goals focused on cash flow. Incremental growth will have a compound effect.
How many times have you heard someone say, "This is going to change everything," only to find out that their product or service is just like someone else's, with a minor twist? I understand that you are excited and fired up about your solution to the world, but have you lost touch with the audience that you think needs your solution?
I have seen and worked with countless big visionaries who overestimated the value they offered by slightly differentiating themselves from their competitors. Unfortunately, this is not always enough to make you stand out, especially if you offer a service. However, what can significantly increase your value if done correctly is the support and guidance you provide through your products and services. In a world that is becoming increasingly automated and depersonalized, it's important to take a more "human" approach, especially when it comes to onboarding.
This is a common issue I see among many consultants, coaches, and service providers today. They fail to understand the value of their time. While you can make an unlimited amount of money in your lifetime, you cannot get an unlimited amount of time. Time is a finite resource, and it is our most valuable one. Therefore, it is essential to use it wisely. People often underestimate the time required for each task and overestimate their abilities.
To manage my time effectively, I follow the Pareto Principle. My entire work calendar is scheduled around five blocks of 90 minutes each, divided into no more than three tasks for each block. This approach keeps me focused and on target for achieving my goals or objectives.
Another way to manage time effectively is to approach each engagement with intention and purpose. When someone requests my time, I weigh it against other priorities that have value in my life. If something or someone takes me away from those priorities, it must have a greater weight to do so.
I could probably write a book on this topic alone, as there are so many good practices for time management.
This is a big mistake that I've seen many times. Clients want me to take an existing competitor's program and copy it, but with their own style. Or they want to follow someone else's success path, even if that person is still trying to sell them a product or service they don't fully understand themselves.
Here's the truth: your path to success is unique to you. It's based on many factors that produce your own reality. That's why we've created strategic frameworks that have been thoroughly tested across many industries. They help you extract your own brand blueprint to achieve your vision. Even if you're in a highly competitive industry, your unique approach to the solution is valuable enough. You just need to be willing to challenge yourself through the process to achieve success.
I'm sure you see this almost every day: ways to make more money with little effort, or ways to "hack" or "exploit" the system to get more traffic. They don't tell you about the risks you take or the holes you create in your business's foundation because you're not willing to go through the necessary process for success and growth. I'm not talking about improving efficiency to streamline your success.
I remember when SEO was newly emerging and there were many black hat practices being implemented. I warned people that these practices would work in the short term, but they would have long-term consequences. Most didn't listen, and some even got their domains permanently banned as a result. Running a business is not a sprint, it's a marathon. Don't take shortcuts that will cost you in the long run. Examine all facets before implementing "new" strategies. Our frameworks guide you to success, but it's a challenging process intentionally.
One of the biggest reasons for the failure of a service-based business, especially one with a coaching or consulting business model, is the inability to create healthy boundaries with clients. Most consultants or coaches become their own worst enemies and a bottleneck to their growth potential. They overpromise and underdeliver in the long run because they can’t handle the demand of needs, don’t structure their time accordingly to include the chaos, and/or are so focused on serving clients that they neglect critical relationships in their lives.
Boundaries are key in any relationship, and you need to learn the power of saying NO. Clearly define your expectations for the working relationship and the environment in which you will serve your client. Be clear on what it is and what it is NOT. I cannot stress this enough!
It's understandable to want to implement a new process or strategy that achieves greater clarity. Especially when someone else developed it. However, for many business, marketing, branding, and personal development coaches or consultants, this results in inconsistently staying in their own lane.
I too have fallen victim to this, especially with Simon Sinek's "golden circle", which we adapted to our strategy in the beginning. Later, we realized that it wasn't the right fit for us as it lacked a critical component not expressed in the original concept. To this day, I still see many have implemented this in their core processes.
We realized in our case that it was the WHO that drives the why, the how, and the what. Not the why as many focus on. This approach works best and proved true when tested. Therefore, make sure you are implementing products and services that are within your scope and sphere of influence. Then stay consistently in that lane. I have been in the branding and marketing industry for 25+ years, and more focused on just brand strategy in the last 6 years. Know what you are and what you are NOT.
In a world of emerging technology, the business landscape is constantly changing, and sometimes we must adapt to the marketplace environment. The main catalyst for adaptation is AI. Whether it is actual AI or Artificial Enhancement (AE) is another conversation, but AI is affecting many business functions. As a result, many are being forced to come to terms with the fact that AI is here to stay.
I have seen many early adopters of this technology scrambling to be the first to provide some type of value to gain a foothold in the market. Some have produced prompt cheatsheets to gain ground, but the amount of conversation around AI is overwhelming.
I am reminded of a company called Apple that is rarely first to market, yet is an industry leader in emerging technology. While others have been quick to provide AI solutions that may or may not be within their lane, we have been testing how AI responds to our frameworks and where we are going as a company. I am happy to say that it supercharges our ability and puts the power in the client's hands. We are excited about AI as it does not replace us but becomes a tool to extend our abilities, but it still requires proper guidance.
This is especially true for entrepreneurs pursuing multiple revenue streams. They may lose interest in their original project or be influenced by others around them to change directions. They may end up creating a Frankenstein solution, move on to other projects, or even fail to launch.
The key is to stay consistent, and I suggest the piggyback method. Have the projects related in some way that will build another facet of the solution you offer. It is important to understand that consistency compounds, but in the beginning, it can feel like pushing a boulder uphill. Stay at it if you feel it in your gut to do so.
Our frameworks test the validity of these distractions and can create common threads that you may have never seen before while keeping you on task to accomplish the vision you set to manifest.
While having a big vision is great, it can be difficult to bring all of the critical pieces together to make it a reality. This is especially true for big dreamers and visionaries who struggle to bring their ideas into tangible reality. It's important to have a structured framework in place that allows you to test all the pieces of your vision, bringing focus and clarity to the chaos. We provide guidance to help our clients do just that, adding accountability to ensure that their vision becomes a reality.
Even if you have a groundbreaking product or service, your audience won't trust you unless they feel that you understand their pain points. It's crucial to acknowledge your audience, making them feel heard and understood. We work with our clients to help them understand their audience on a deeper, subconscious level, using Carl Jung's Archetype Theory to reveal and position their solution in a way that resonates with their audience.
The messages you put out must resonate with your target audience. If they don't, you won't gain traction or attract the right clients. It's important to understand the power of trigger words that evoke the desired action from your audience. Our brand strategy framework helps our clients find their unique voice and trigger words that resonate with their audience, setting them apart from their competitors.
While writing this, I thought of many more reasons why brands fail based on my experience. There can be a myriad of reasons, but I chose to focus on 12 that are often overlooked but crucial.
Feel free to share other reasons and your thoughts in the comments below.
We are ready to help you choose a success path that will transform your business into an unforgettable brand. During this session, we will answer any questions you have regarding our 12-month consulting program.
We want to ensure that you choose the option that best meets your growth needs. Sometimes, you may think you need more, but less may be what gets you there. We don't want to sell products or services you don't need just to make a profit.
We look forward to a conversation centered around transforming your brand and achieving success.