Blog Post

  • Marketplace

Why do businesses fail?

In many ways it’s never been easier to start a business and run it profitably than it is right now - so why do we still see businesses failing in the marketplace?

Changes in technology have cut overheads down in terms of marketing your business, managing your business’ finances and even considering how many staff you employ, thanks to automation.

But failure is still rife in the business community.

There are a variety of reasons, and some are unique to the industry that business is in, so the following is a look at why businesses in the same industry fail.

They’re dealing with the same customers. They’re facing the same competitive forces. So what makes one fail and the other succeed?

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We hope this will share some insight on how your business can avoid the former …


No point of difference, or single unique aspect of their marketing.

The fact that Masters wasn’t the first player in the hardware market wasn’t the problem at hand.

Apple wasn’t the first company to make computers or smart phones, just like Aldi wasn’t close to being Australia’s first supermarket.

But they both entered their respective markets with a clear point of difference, something Masters failed to do.

Consumers already had an established hardware offering from Bunnings and Masters failed to deliver a reason to switch.

Furthermore, Bunnings has had an effective marketing message in place for years via their price guarantee, and Masters wasn’t able to create an offer that bested that for the market.


Failure to embrace technology and adapt alongside their target market.

Dominos and Eagle Boys. Both big names in the fast food pizza scene a decade ago. Both franchise businesses with a national footprint. So why does one fail but not the other?

Here’s a hint, it’s got nothing to do with their pizza.

The short answer is Eagle Boys failed to deliver a new experience to their target market, which was growing out of old habits.

Fast food pizza has always been a food experience enjoyed by the younger generations, no matter what era, and the inability of Eagle Boys to create a slick, reliable online ordering service was a major downfall for their business, as people opted to order on their phone instead of calling the business directly.

Not being able to keep up with your target market is a risk for every business out there, with the pace of technological advancements now measured in years, not decades.

Streamlined, online business is everywhere now, from having your groceries delivered to your door instead of going to the shops, to booking an appointment with your GP online. The slow reaction of Eagle Boys to jump on these trends cost them in the long run.


Putting brand awareness above brand integrity, and advertising when you’ve got nothing to offer.

Australians love to gamble, and that’s highlighted by our booming sports betting marketplace. So how does one company face backlash from the market, when all the others go from strength to strength?

In the case of Tom Waterhouse, the business’ inability to get a foothold in the market came back to failing to understand that being seen at every waking moment on primetime television isn’t always an effective marketing strategy.

After initially entering the market targeting everyday gamblers, the business quickly had to re-assess and pivot towards gamblers with a minimum $1,000 wager after losing the broader market’s support.

Waterhouse’s company was infamous for ‘over-advertising’ to the point of annoyance, where if you sat down to watch a 1 hour program, you’d likely see his ads a handful of times in that period.

Now I know what you’re thinking, “every betting company does that too”; but the difference is that these companies are almost always advertising a new deal, for a sporting event that very week.

That’s certainly the case for Sportsbet, and for so many others.

That kind of advertising provides value to the target market, by keeping them in the know, but if we look at Tom Waterhouse, they advertised the one ad for months on end, which simply explained who he was, his family’s rich history in the market and why he knew gambling better than others.

Rightfully so, it was judged as self-indulgent, and people grew very tired of hearing about why ‘he was born to do this’.

It’s a cautious tale of advertising when you’ve got something to say, and not just for the sake of it.

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All the businesses above, either succeeded or languished thanks to the quality of their marketing strategy.

Published on June 18, 2018 by Jordan Fitzgerald