It is a sobering thought to most entrepreneurs that over half of all small businesses fail within the first two years of starting out. The importance of marketing for startups really cannot be overstated. And while there are many factors that add up to this statistic, it’s often compounded by a lack of a strong digital marketing strategy. Of course, with the inherent costs associated with starting a business, it’s understandable how an already limited budget may not be sufficient for a lucrative marketing plan, but the fact is that strong marketing strategy for startups is the key to success in today’s day and age. 

For those out there looking to avoid those failure rate statistics, here are the top reasons why most small businesses fail within first two years of operation. 

1. They Fail To Research The Market

Many businesses fail to do the necessary research to guarantee that their business plan is feasible within their given market or location. Following your dreams and passion is certainly important, but you should also take into account whether there’s already an existing demand for the service or product you’re trying to offer. This will make entering the market much more natural than having to convince your audience and force your service on them. Researching your market will also supply you with lots of useful information regarding your potential competitors. 


2. Failing To Stick With The Business Plan

Another reason many small businesses fail is because they fail to stick to their original business plan. Creating a business plan takes time and dedication, and it is there to serve as a success model for your company. This plan is a blueprint for your company goals, possible problems and solutions, as well as the costs and timelines associated with reaching these goals. That is why it’s unadvised to veer away from that set path, except maybe in unforeseen cases when the plan itself is rendered ineffective or inaccurate. Failing to stay on track can mean serious repercussions down the line that can derail the entire enterprise. A single change can snowball into a series of unexpected delays and inaccuracies, and fixing these can easily drain your budget. 


3. Lack Of Financing

The failure of many small businesses can be linked to a lack of their initial financing. It may seem manageable to get by while stretching a minimal budget through the initial growing stages, but the lack of resources at the critical moment can spell the company’s demise. To save yourself from running out of money halfway through liftoff, you’ll need an accurate business plan and sufficient investment capital to see you though until you’re profitable.

4. Lack Of A Digital Marketing Strategy

It used to be that the key to business was “location, location, location,” but in the digitalized world, all businesses have to share a location – the internet. Making your website and company visible online is one of the greatest struggles and downfalls for startups because of the sheer amount of competition out there. To be successful as a startup, you must carve out a niche and invest in creative marketing strategies that allow you to gain a portion of your audience’s search volume, while you’re still unable to contend for the most competitive keywords. A successful digital marketing strategy delivers your targeted content in front of the right audience and drives conversions and sales. A poorly managed one, on the other hand, will only waste your time and valuable budget. 

5. Being Inflexible

We live and operate our businesses in such a fast-changing time that flexibility needs to be at the heart of any successful organization. To stay competitive in any field, you’ll need to evolve along with the changing industry and marketing trends – specifically when it comes to your online presence and advertising. That is why the lack of adaptability is one of the top reasons new businesses fail in their initial stages. 

6. Scaling Too Quickly

Some small businesses gain initial success only to see it fall apart in their efforts to grow their company too quickly. Scaling your operation is a delicate matter, which should involve research into each new market you are hoping to enter. Just because a business model works for one location and service, doesn’t necessarily mean that success can be translated any and everywhere else. Growing too fast without taking new challenges into account can drain a business during this crucial transition. 


Final Thoughts

We hope these common reasons for failure among startup business can help you navigate the first few challenging years of operation. Without a doubt, there are plenty of pitfalls for any company starting out, but perhaps the biggest one of all is the lack of successful marketing. For any business trying to compete for an audience, it is crucial to make your brand visible first. For those with limited experience, partnering with a reputable marketing agency can give you the competitive edge you need to succeed.