I figured that the DJANGO_SETTINGS_MODULE had to be set some way, so I looked at the documentation (link updated) and found:
export DJANGO_SETTINGS_MODULE=mysite.settings
Though that is not enough if you are running a server on heroku, you need to specify it there, too. Like this:
heroku config:set DJANGO_SETTINGS_MODULE=mysite.settings --account <your account name>
In my specific case I ran these two and everything worked out:
export DJANGO_SETTINGS_MODULE=nirla.settings
heroku config:set DJANGO_SETTINGS_MODULE=nirla.settings --account personal
Edit
I would also like to point out that you have to re-do this every time you close or restart your virtual environment. Instead, you should automate the process by going to venv/bin/activate and adding the line: set DJANGO_SETTINGS_MODULE=mysite.settings
to the bottom of the code. From now on every time you activate the virtual environment, you will be using that app’s settings.