Final answer:
B2B subscription startups commonly err by misjudging demand elasticity and failing to consider close substitutes and customer preferences, leading to misalignment with market needs.
Step-by-step explanation:
One of the most common mistakes made by B2B subscription startups in their early stages includes a misjudgement of the elasticity of demand, not accounting for the presence of close substitutes. For instance, Netflix's management failed to recognize the competition from services like Vudu, Amazon Prime, and Hulu, as well as the convenience of Redbox kiosks. They also misjudged customer preferences and tastes, assuming a readiness to transition from physical DVDs to streaming services without fully considering consumer behavior.
Moreover, novice companies often enter the market without adequate background on customer needs or adequate explanation of their service's advantages. This could stem from a difficulty in understanding how much background information to provide and what terms to define for their audience. Finally, startups can sometimes provide either too much technical detail or not enough, which can confuse potential clients and hinder their decision-making process.