Overcoming Obstacles: How We Measure Success
519130. That is my new NASIC code. A NASIC code is how the government classifies your business, mine is now for “internet publishing and broadcasting.” I had to look this up when I applied for the second draw of the PPP. I got lucky and hadn’t applied for the second drawl before Biden made changes that benefitted sole-proprietors. Under the new rules I can now use all of my government bail out to fund my business long enough to stop worrying if the cost is worth the potential payoff, at least in the short run. But I’m at a juncture where I am asking myself what does success even look like?
One of the first things anyone will tell you when you start a business is to have a business model with a through plan. But according to the most recent data from the Bureau of Labor Statistics only 17% of businesses fail because they lacked these things. I can’t speak to all businesses or industries but I know from first hand experience that the model is a great place to start, but success often hinges on the ability to pivot and be flexible. The data also showed that the most common reason for failure is because there’s no market need for their services. I have known too many businesses that failed because they refused to accept that not enough people were interested in what they were offering. If we build it, they will come, only works in Kevin Costner movies.
There is an old economics joke that goes like this: two economists walk down the street and one bends over to pick up what he thinks is $20 bill on the ground and the other economist says “there’s no money on the ground, if it were really there someone would have picked it up by now.” The point of the joke is that new business opportunities rarely arise. When someone thinks they have a totally unique idea, often the reality is, if there was a market for that product or service someone would already be selling it.
On the flip side the second most common reason for failure is running out of cash. When the market is saturated, you have to spend a lot of money to keep up. Copying someone else’s model but doing it better or marketing a successful model to a different audience is expensive. There’s a really successful mid-sized fashion blogger, who blew up almost overnight because previously all the influencers were a size 0 and were leaving money on the table for mid-sized and plus sized women. That said, she must have spent a fortune to get started because you don’t get a lot of free stuff until you’ve already made it.
Figuring out where I fit in the market has been tricky. I have a long list of things I want to accomplish and a business plan that was naive for all sorts of reasons. I haven’t hit any of my original targets but I am exceeding my profit projections. I keep setting goals about things I think will be helpful and then missing them. Case and point, Instagram. I have gained about 300 followers since January, but I had hoped to have gained 1,000.
I listened to a podcast from a company called Thrive who advise people on social media marketing. The moral of the story is that Instagram is now too difficult to hack. If you weren’t big before, because of their algorithm, it’s too late to make it now. The worst thing about Instagram is that the algorithm is a bit of a mystery. We know they prioritize posts that have immediate interaction so the time of day you post is important but you will get muscled out almost instantly by the influencers who have tens of thousands of followers who also know what time of day to post. It’s also a lot of work for very little return. If I spend 20 minutes a day, I get around 5 followers a week. If I spend an hour I’ll get 15 but that’s still not a big enough growth factor to be worth the time.
I thought I could use Instagram to beef up my social media presence but it turned out I didn’t need it. Unlike Instagram, who keeps their algorithm a secret, Google is really open about SEO results. I am more successful getting traffic to my blog with targeted keywords and great descriptions about the content of my posts then I ever get with Instagram. Ultimately the goal is to draw traffic to the blog and monetize that traffic. Wix, the site hosting my site, also gives me really useful data about from where and when traffic comes to my blog. Monthly I hit my traffic goals but I have yet to meet my profit goals from the blog.
Unfortunately or fortunately, depending on how you look at it, my profits are coming from an app called Like to Know It (LTK). In a nutshell I take pictures of my outfits of the day, I post them on LTK, and if someone buys something I am wearing I get a commission. So the good news is getting dressed up and taking pictures of myself is something I was already doing. The bad news is this isn’t how I wanted to make my money. I don’t really want to be in the business of fashion influencing but the money just keeps rolling in.
It’s a costly business to get started, I mentioned earlier the mid-sized fashion blogger who must have spent a fortune getting started. Up front the cheapest way to get started is Target fashion. It’s inexpensive and it’s easy to return what I don’t like or doesn’t look good on me. But the cheaper the clothes the less money you make. Nordstrom clothes cost more, but the profit margin is much higher. If I buy a $20 dress from Target, I make approximately $0.20 per sale. Which means I need to sell 100 to cover my cost. If I buy a $60 dress from Nordstrom, I make approximately $3.00 per sale so I only need to sell 20 to cover my cost.
I won’t get into the different marketing strategies from various clothing retailers. What I will tell you is that LTK tells me exactly what I need to do to be successful. They tell me what trends to showcase, what keywords to use, what the profit margins are and which retailers are having sales. They also track all sorts of useful data on what’s performing for you and what’s not. They set you up to be successful rather than making you take wild guesses. The more money I make, the more money they make.
I’ve learned a lot of lessons the hard way. Especially since this isn’t the way I want to be making money. I’ll spare you the details, but basically I fall on my face when I don’t plan out my LTK strategy. I keep running into this problem because it’s not what I want to do. The time involved has cut back on my time to write, develop my online courses, finish our Disney workbooks, etc. When I check the stats, and read the weekly trend reports, carefully plan out my buying and make time for giant photo sessions, I make money, more than I thought I would. This begs the question, is it time to pivot?
I’m on trajectory to become a micro-influencer, but that’s not really what I want to be. I’m at a bit of a crossroads. Either I pivot and fully embrace fashion or I accept that both my other business ventures and my fashion hobby will both suffer and my success will come much further down the road, if at all. I have already cut down posting to my blog from three times a week to two, I’m working at a snail's pace on my first digital course, and so forth and so forth. But before I shut the door on my dream, I have to figure out how I am measuring success.
Right now I have kind of accepted that fashion influencing is funding my other ventures. What is a job, if not to fund your life? I am fortunate enough to have a husband with a successful job and we don’t need my salary to pay the bills. But if I sit around and do nothing, make nothing, I am not going on big vacations and I can’t buy designer shoes. I also don’t want to sit around and do nothing. I started blogging because I was bored and frustrated with digital learning mom life and needed something that brings me joy. People talk a lot about work/life balance. Where is that for me and what am I classifying as work versus play? Is success only in my profit margin or is it in fulfilling my passions?
President Biden bought me some time to figure it out, for which I am grateful. Eventually though, I am going to have to answer the question. Do I try to pick that $20 bill I think I see on the ground up or do I keep walking towards a reliable income source? How do I balance the work I am passionate about versus the work that is profitable? What does my long term business plan look like? Do I need to pivot? How do I measure success? I have absolutely no idea.