‘You don’t learn to walk by
following rules. You learn by
doing, and by falling over.’
RICHARD BRANSON
I’ve made a few business mistakes. Okay, more than a few. One big one was making physical products; a close second was creating a mobile app. Now, on the surface, neither looked like a screw-up, but internally, both decisions were wrong for me and were driven by various forms of procrastination, self-sabotage, and the fear of missing out. (By the way, if you make physical products or apps, I’m not dissing your business model. One person’s keyless life is another’s prison.)
Here are my two most recent mistakes (I’m sure they won’t be the last), and some lessons that are applicable to any business.
My path to physical products started out innocently enough: instead of business cards, I got fake money made with my face on it. It was fun and cute, and my community loved it. Then, when I started doing live events, I thought it was a must to give everyone a branded notebook, pen, and calculator. I almost made giant $50-note beach towels, but stopped myself just in time.
Then, during a spectacular procrastination session, I started making Lucky Bitch swag – for no reason (I didn’t even sell it). Of course, I didn’t get out my sewing machine or buy my own kiln – there are tons of companies who’ll support your procrasti-branding by making things on demand; all you have to do is upload your logo and they’ll ship it to you. For example, I made Lucky Bitch cushions, a towel, wrapping paper, Christmas ornaments, stickers, etc.
And then I found a site that does print-on-demand clothing. So, naturally, I made my own branded kimonos. Now, to be fair, they’ve come in handy because my staff can wear them to my events, but still… kimonos. The clothing company had a wealth of options, so I also made a hideous jumpsuit, a mesh tank top, a one-piece swimsuit, and a zippered clutch bag. I almost went for the yoga pants, but my accountant started questioning the validity of all my branded merch, and I had to cut myself off.
Just because the technology exists to make branded merchandise inexpensively, does not mean you should do it – unless it’s your business model. My business is helping women release their money blocks, not making branded bikinis and Christmas ornaments. I’m a big advocate of fun marketing, and people regularly ask me where they can buy the branded Lucky Bitch merch. But the answer is: you can’t. It’s not my business, and I don’t care if I could make a few bucks from it.
Shiny objects are the sexy new ideas that prevent you from focusing. Before you go out of your primary offering, ask yourself: is this a valid business extension or a distracting sabotage? I admit that, now my business has been successful for a few years, I do sometimes get itchy or bored. Hence the branded mesh yoga tank top! I recently discovered a company that makes branded clocks. Could I make one with my popular mantra, ‘It’s your time, and you’re ready for the next step’? Yessss – no!
For most entrepreneurs, the ‘rush’ of being in business comes at the beginning, during the startup and innovation phase. This is why you’ll feel compelled to create a new website even when your current one is fine. Resist the urge. Seriously, get a hobby instead. Get a new haircut. Don’t blow up your business just before things start working.
When you find yourself tempted by a shiny object, ask yourself whether you’re procrastinating or whether it’s a legitimate pivot in a better direction. Is it for credibility? Does it lead into more profitable work? There could be easier ways to achieve that. Beware of how your procrastination manifests itself. Whether it’s collecting another certification (procrasti-learning) or starting a new business offering because your mentor (or business nemesis) does, get real about how it’s impacting your income.
There are easier ways to make money.
I should put that on a T-shirt and sell it! Wait… No!
Now let’s talk about my money-tracking app. On the surface, it was a huge business win: my community loved it, and it’s both gorgeous and useful. But I went into it for the wrong reasons. This is kind of embarrassing, but I literally made it because the author Danielle LaPorte had one. I didn’t think about why I wanted one – it just seemed like the thing to do. It felt sexy, cutting edge and, on the surface, seemed to fit into my business.
I invested around $12,000 in design and development, and when it came to picking the sales price, I realized my big mistake. Apps are generally priced very cheaply, maybe a few dollars, and low-cost products don’t fit into my business model. Oops! My philosophy is ‘free or expensive.’ I’ve deliberately built a business on giving away information for free and also leading people into my paid courses. Free means I can walk away at any time; free means that my freedom is my most important value.
I’ve also noticed that, when something is cheap, disgruntled customers feel even more entitled and angry when something goes wrong. So, rather than scrapping the app after investing all that money, we made it free. It feels generous, we don’t have to deal with refunds, and if anyone has tech problems, we can apologize but don’t have to spend endless hours trying to solve the problem.
I felt peace at that decision, but I drew the line at creating an Android version of the app. Almost every day, someone says ‘Pleeeaaase! I’ll even pay for it,’ or they straight-up demand I create it for them. My response is always, ‘I’m really sorry, but I’m never making one.’ Yes, it hurts to disappoint people, but I’m not going to throw good money after bad now I’ve realized my mistake. To be honest, I’ll probably discontinue the app at some point to simplify my business even further. Even though it was a good idea and people liked it, I’m just not in the app business. Not everything has to be my business. What I offer is free or expensive. Lesson learned!
Wait, isn’t it better to be paid something than nothing? Not really. Not all money is equal or fun to earn. Once you put a price on something, it comes with a certain set of customer service expectations. If I’m asking for money, I’d rather it be worth my while.
In my experience, at least 3 percent of customers need a lot of extra help, or in worst-case scenarios, become ‘nightmare’ clients. Unless you want to deal with that yourself, you’ll have to hire someone to manage the inevitable emails and social media messages. People will lose their login or password details (sometimes more than once), have software glitches, need help figuring out how to access things, and want refunds that need to be processed.
This is true whether you’re charging $2 or $2,000. If 1,000 people bought my app at $2, my revenue would be $2,000; and if 1,000 people bought my Money Bootcamp, my revenue would be more than $2,000,000. If 30 people needed significant customer service help in both scenarios (and were potentially annoying to deal with), which would you rather spend time on? Is it worth two bucks for me to deal with a disgruntled customer? Not really. That’s not my model, and I’d rather have the two million bucks thanks very much!
It takes as much time (often less) to create a more expensive product as a cheap one. Read that again.
Think of books – it can take nine months or more to write and publish a book, and the average cover price is between $5 and $30; your cut will be just a few dollars. Creating my app took several months and it cost more to produce than most of my courses that sell for a thousand times more. What’s the obvious choice? More or less work?
Everything you do in your business and life is an energetic tradeoff. Think about the implications of expanding your business model. Does the change require more customer service, technical help, or physical work such as shipping? Again, if that’s what you do, it’s fine. But if not, it will distract you from your true work.
If my courses and the app each convert to sales at 1 percent (which is normal, as we’ll discuss later), which would you rather create? My preference is always to go for the most profitable business that causes the least amount of hassle. That’s when you become a Chillpreneur.
It’s okay to say no. You don’t have to be everything to everyone, even if it’s a good idea. Your community wants live events, but you don’t want to travel? Say no. Clients want you to get up at 5 a.m. for a coaching session in their time zone? Say no. People ask me to create a men’s version of my book Get Rich, Lucky Bitch. What would I call it – Get Rich, Lucky Dick? Lucky Dude, Lucky Bastard? Sorry, no.
If you ask them, your audience will give you tons of random ideas, but you don’t have to act on them if they don’t fit with your values or your preferred business model. You don’t have to do all the things for all the people!
Not all ideas are good (for you). It’s okay to
follow the easiest and most profitable ones.