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Top 6 Mistakes that Newbie Designers and Online Entrepreneurs Make

It’s not uncommon to hear stories of large-scale online business failures. From major companies – anyone remember Webvan? – to small design firms and marketing agencies, failure is a part of doing business. With the low costs of starting and operating a business online, many businesses that would fail under other circumstances end up getting started. Sometimes they grow into leading enterprises, but more often than not, they don’t.

We’ve identified the six most common mistakes that newbie designers, entrepreneurs, and online businesspeople make when they start their own online businesses. If you’re just starting out online yourself, use this article as a template of what not to do in your business. The best business lessons are often learned from other people’s failures, and these six should give you a good foundation for creating a long-term online business.

1. Expanding Too Fast.

You started a business, saw a relatively large amount of success, and thought that the bigger you grew, the bigger the money would get. Unfortunately, the infinite growth model rarely works for online businesses, particularly service businesses which require a lot of manual upkeep and client-based attention.

Whenever your business has the potential to expand, think through the situation as a whole. Boosting your client count or product’s reach could bring in new income, but it could also create new expenses and a lot of new headaches. Business success is about weighing the ups and downs – sometimes expansion brings in more of one than the other. Plan accordingly.

2. Overestimating Their Influence.

Control is an important factor in business. Meetings tend to move according to the most influential person – the guiding presence in the meeting and the most important factor in negotiation. As a new entrepreneur it’s easy to overestimate your influence amongst clients, business partners, and potential collaborators.

It’s not so much ego as it is a misunderstanding. Business requires a certain degree of pushiness, but too much ends up poisoning negotiations and potentially alienating clients and customers. Whenever you’re reaching out to another businessperson, client, or prospective customer, treat them like a guest and remember that you’re asking them for something, not the other way around.

3. Taking on Too Much Work at Once.

This error is most common amongst designers, but results-based business of all forms are susceptible to it. In an effort to boost revenue and increase per-client profits, many service businesses simply bite off more than they can chew. Employees are pushed to the limit, deadlines are stretched, and many clients end up unhappy.

It’s hard to suggest anything other than this behaviour, as risk like this is important for a successful company. However, whenever possible it’s best to be in control of your risk. Rather than giving hundreds of clients or customers second-class treatment, aim for top-level treatment with a smaller sample of people. Position yourself as a premium provider and you’ll end up with a more fluid, controllable, and well-rounded business.

4. Pricing Themselves Too Low, or Too High.

Charge people too much and you’ll fail to gain clients. Charge too little and you’ll end up overwhelmed with low-paying work and unable to cope with the quantity. Setting prices as a service business is a balancing act, and it’s one that can take quite a lot of time to adjust to. Whenever possible, look at your business as a premium product. Price yourself above competitors to ensure that your work is profitable and worthwhile, but don’t price yourself in a range where you’re unable to gain valuable client referrals and long-term projects.

5. Ignoring Professionalism.

Online businesses are great in that they allow entrepreneurs to work from their living rooms, and limiting in that they insulate people from the corporate world. As a designer, service provider, or B2B business, you’re bound to work with some major companies and multinational corporations. Pitching, contacting, and keeping in touch with clients requires a fine touch, and a level of professionalism that’s often lacking amongst online businesses.

Invest in what’s required to get your foot in the door. If that’s nice clothes for a business meeting, it could be worth it. If it’s a customer and client support employee for providing the impression of a big company, take it. If there’s a way for you to appear more professional and experienced, do almost anything possible to achieve it.

6. Worrying Too Much.

Let’s face it, as a newbie designer or businessperson, the natural reaction is to respond to things with caution and temperance. Sometimes business opportunities come in, and rather than reacting to them with potential planning and long-term thinking, newbie designers think that all which could go wrong because of them.

This type of thinking is good for running a low-risk business, but ineffective for running an ultra-successful business. Risk is a very important part of business, and letting it control your thinking leaves you stuck at a standstill. Sometimes it’s best to apologize for mistakes – whether to clients, customers, or business partners – than to beg for the opportunity to do something.