Why Your Online Business Ideas Keep Failing
The easier it is to get into something like affiliate marketing or dropshipping, the harder it is to actually make a sustainable income.
If you or someone you care about has been struggling to make it as an entrepreneur, this post is for you.
I’m going to answer a question from a subscriber, but I also want to explain the difference between business opportunities, which is not a good thing even though the word sounds like a really positive opportunity, and real business education and training.
If perhaps way too many of the advertisements you see on Instagram or somewhere are for passive income ideas or great business opportunities, I’ll explain what you can look out for if you are trying to take some kind of online course on how to grow an online business or just generally want to start a business that allows you to have a better lifestyle.
The email came from Steve and he says:
I’ve had five traditional businesses. Then years ago I fell into the multi-level marketing scheme, finally got out of that after losing my marriage home, etc.
Then I started trading – man, I love to trade, but very hard to make consistent income in trading.
Now I’m looking at affiliate marketing, but it seems to me and looks like everyone and their dogs are doing it. I’ve also looked at writing like you, but I’m not a writer.
I also tried a Wealthy Affiliate, but they are also just a cleverly disguised mlm business and recruiting deal.
I really want a real business, but I want to start an online business so it can be done anywhere and give me a worldwide audience. The closest two businesses I found are trading and affiliate marketing because they require no traditional business headaches like employees overhead, inventory, etc.
Do you ever go over great business opportunities and ideas? I really dream of a business that will help me be free.
That is an awesome question. I do not think you are alone, Steve.
Why Your Small Business Fails: The Red Flags
There are some red flags in your email, which is what inspired me to create a response because I see that a lot.
First, I won’t say your email, but your email includes the word passive, as if you have a separate email account set up for trying to create passive income or something like this.
There’s also the clear trend getting into this multilevel marketing and pyramid schemes and going really deep in it.
And I told you in my email that I would respond and that it might not be pleasant, but it would be the truth.
In my experience, people who go really deep in multi-level marketing, or so-called MLM, their way of thinking has some serious flaws, which can be fixed, but it takes a serious readjustment and some business education.
I know this guy back in Vancouver, and he went deep into the multi level marketing and then I cut off the friendship because it was ridiculous.
Then every six months or a year he’d come to me and tell me how he realized he made such a mistake and he wasn’t into MLMs anymore and then he pitched me on another multi-level marketing scam and said this time it wasn’t one – and I really think he believed it wasn’t.
And when I see what you’ve then tried to do with businesses online trading and affiliate marketing, my hunch is you weren’t sitting around your house thinking:
How can I add value to the world?
How to start a business I’d be passionate about?
You were googling, I’m guessing: how to make money online, ways to earn passive income or how to create passive income, how to have a freedom business, and this kind of BS.
The truth is, when you go down that route, you don’t find how you can create your own unique business, you get sold on business opportunities, and that’s really the theme of this post:
The difference between business opportunities, as in like a marketing niche, and actually creating a business of value.
Business Opportunities for Sale
So within the marketing and copyright world, there are different niches that people specialize in marketing.
You have things like personal development, health, and wellness, and one which is specifically called the business opportunity niche.
People who sell in this niche often sell a variety of business opportunities.
It’s not like they’re an expert in one thing they become really good at and that’s the only thing they ever sell. It’s a niche.
And truthfully, if you heard the way copywriters and marketers talked about the audience in this niche, you would probably be a little disgusted and offended.
This is a niche where you sell an opportunity.
It’s not a real business training for entrepreneurs. This is very different.
I’m a big proponent of business training. I have courses that teach you how to deal with clients, how to become a better writer, how to do sales meetings – that’s business education and training.
Business opportunities are specifically telling you, in many cases: It doesn’t matter what experience you have, it doesn’t matter what your education is – this is an opportunity and, generally, they’re selling based on terms like passive income, work online, online business from home, etc.
They often throw around a lot of income claims, you know:
We can’t promise this will happen to everyone, but Chris over here just made $80,000 in his third month and if you sign up today, that could be you.
In many cases, the people behind business opportunities have had success in that area. Perhaps they did create a business on Amazon, or were affiliate marketers and had success and then they’re teaching their system for that.
In many cases, they haven’t.
I was in an online mastermind group for entrepreneurs where sometimes small business ideas were discussed and one of the guys in it definitely fell into the sleazy affiliate marketer mindset, which is one of the reasons that I moved away from that group.
He was talking about making a Forex foreign exchange trading business opportunity course teaching people how to do Forex and selling that.
He’d never done it himself. And he’s like: I’ll google some things and I’ll make a course and charge people $2,000.
This is very common and so the people behind business opportunities, in many cases, don’t see humans as humans.
I’m not going to speculate what their personality types might be, but they’re usually not the most social, caring, and loving people.
They’re very numbers-driven with very little sense of morals.
It did not appear weird to this guy to sell training on something he’d never had success in to make money.
Once we all pointed out to him how messed up that was, he kind of backed down, but my hunch is he’s doing something like that right now.
He backed down because he realized that wasn’t socially acceptable to do and he’s probably doing it in secret somewhere.
Opportunity Marketing Red Flags: Spot Them & Avoid Business Failure
Here are a few of the red flags to keep in mind and check if something is specifically a business opportunity, so you can avoid business failure right from the start:
Big Income Claims: I’ve already mentioned big income claims, specifically passive income, so a red flag is if a lot of what they sell it on is on the income or lifestyle
Anyone Can Do It: A claim that you don’t need any skill or specific background or something like anyone can do it
Now, the really smart marketers will actually put things in like not everyone can do this, you have to be able to turn on a laptop and they’ll actually put in some serious things, though, to try to make it appear like it’s not this because marketers get more and more advanced and they find ways to not seem like the scam that they had a few years ago, and that this is something different, or whatever.
It’s Urgent, Don’t Miss Out: The last thing is that there’s always a sense of urgency like you’re going to miss out on this great business opportunity. Or they talk about how big the market is. So maybe someone promoting a course on how can you make money on Amazon, they’ll talk about how big Amazon is. Amazon’s a trillion-dollar company, and every day a billion dollars and if you just get a tiny slice of that, you’ll be successful!
So they often talk about this business opportunity, how big it is, and how there isn’t a lot of time for it.
I can tell you since I used to be a copywriter and I saw behind the scenes on a lot of this stuff and some of the training and documents for the copywriting is that the people marketing in this usually know that people buying business opportunity programs have bought many in the past and have failed as entrepreneurs.
It’s not a surprise to me that you bought an affiliate marketing course trading courses and probably some other courses as well.
In many, many cases, the marketers are aware that they’re reselling to people who buy maybe one or two of these programs. Often they’re people with jobs, who in theory want to quit and have some extra income, so they’re buying a course on how to make money this way or that way, so this is a way to feel like they’re taking action, but they’re really not doing anything.
In some of these cases, the business training can be really good.
I know there were business training programs out there, where the training is actually really good and the people behind it have had success in that niche so it’s not to say that across the board this is all BS.
But if you’re looking at any kind of business opportunity thing, you have to ask yourself a few important questions to see if it’s more of a mlm business scam or pipe dream for you or if it’s something really legitimate.
How To Start a Business The Right Way
First off, ask yourself:
What is the real value proposition here?
What am I doing to generate value to give to someone else?
How am I making money here?
If you can’t figure out why you’re getting paid, then there’s probably something weird going on.
The next thing is:
What’s strength or skill do I bring to this that would make me special?
Think think about it. If there’s a business course that everyone can buy for $500 and it teaches you how to make a six-figure passive income, well, then everyone would do it.
And that’s probably not the case, right?
Let’s say, for instance, having an Amazon business selling products on Amazon, I’m using that as an example.
And truthfully, as business opportunities go, that’s probably the most legitimate one and the business opportunity where lots of people do make a good money and build a successful Amazon business, but the thing you have to ask yourself is:
Okay, if tens of thousands of people are getting into this business opportunity, what can I do that makes me better than that?
If you’re all following the same tutorials and the same done-for-you systems and step-by-step program, how are you going to make more money than these people?
What tends to happen is you have a race to the bottom, so maybe there was a great business opportunity – someone got in early – wins. The thing was really like easy, cheap, whatever it was, they made a bunch of money.
And then the market gets more and more difficult as it matures.
This is what happens in economies everywhere. If there’s a good opportunity, and it’s easy to make money, more people get involved, it then becomes more difficult to make money and only the strong survive.
If you want to get into something in a mature market – hint: By the time someone is teaching you a course on how to make money in a niche, it’s probably already peaked in terms of the easy stage, that’s probably not like just starting to blow up now when they’re making the course.
So if you’re competing in a mature market, you have to ask yourself:
How can I compete in this market? Am I really good with analytics and math? Am I a great marketer? Am I a great product designer?
What do I bring here?
If you’re not bringing anything unique to the table, guess what?
You’re one of the 99 out of 100 suckers who’s just paying for the bad business course and going to race to the bottom. You’re going to blow money on the course. You’re going to blow money on trying to make the business work out of nothing because you don’t have anything unique to build a real business.
Conclusion: How To Spot a Good Business Opportunity
This brings me full circle to ultimately how you can determine if something is a legitimate business opportunity and if it’s something you should be doing.
- Is there a real opportunity here that you could explain to a five-year-old?
- Why would people give you money?
- Why are you better than 95% of people and can succeed in that business area?
If you can’t answer those questions, you should not be getting involved.
Now, I’m being very general here, but I would say that, generally, if you don’t bring something unique to the table in terms of the offer, then it’s probably a race to the bottom type of business or just something that fully won’t work.
Speaking really generally here, the easier it is to get into something like affiliate marketing or dropshipping, usually, the harder it is to actually make a sustainable income.
And even if you do peak for a little bit and make a few thousand bucks or even $10,000 in one month, you’ll probably crash out sooner than later because you don’t have anything unique.
You’re offering a dropshipping business where you find a supplier who sells their stuff to anyone and, basically, you market their products and they ship it for you.
Well, if you start making money with your business, there’s going to be people who see that, who copy you, who do the same thing and you’re not going to be able to have some kind of unique spot in the market.
Same with affiliate marketing, you’re just promoting someone else’s product.
So the way I always try to think of businesses is:
What can I do where I have a sustainable business that could go years from now?
Where can I work where I have a unique offer?
In my case, with what I’m doing now it’s my personality, my knowledge, if I have some of that, no one can come on YouTube and be like:
Hi, I’m Dan!
And I think I’m really giving value here.
Whereas if you’re drop shipping a product, if you’re doing affiliate marketing, if you’re doing all these things, you’re not really offering any unique value to anyone.
You can be duplicated super easily and you’re ultimately not building a sustainable business.
There’s a reason why in different entrepreneurial circles I’ve been in and meetup groups often that people who are in the dropshipping, affiliate marketing, Forex trading are either really sleazy, kind of high IQ people, who actually do make good money at it, but there are some who are like 26 years old, don’t care about anyone but themselves and are cut out for it – that’s their thing, sadly to say, or – which is the majority of people, they’re not making any money and they’re bouncing around from all these things like:
Oh, I did affiliate marketing for four months and for extra six months and dropshipping, and they’re not really making any money because buying the course from the sociopathic 26-year-old on how to do it, who really doesn’t care if they succeed, and in fact, doesn’t really want them to succeed, because that would be more competition.
This is all one of the big, yet so little talked about, reasons of what causes entrepreneurs to fail, so I hope that you’ve found this at least a little eye-opening in terms of looking at entrepreneurship business opportunities.
Again: If you can’t explain it to a six-year-old, why it makes sense, why you’ll be good at it, and why it could be a business for 5 to 10 years, then probably it is not something you should do.
Have you had experience with multilevel marketing and sleazy marketers before?
Share your experiences in the comments, it may help other people!
Prefer listening? Check Dreams Around The World Podcast for the audio version of this and some more Podcast episodes on business, freelance and entrepreneur advice.
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