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Increase sales by making deployment easier

Everyone wants to sell more, yet few ask what impacts it the most: deployment. I had a long overdue conversation to catch up with Richard Tripp this week. His “POV method” is the best process I’ve seen for refining & re-prioritizing product focus. It’s based partly on finding out the number one outcome that the majority of your actual paying customers care about. Tripp calls this group of customers a company’s “center of success”. To my knowledge, use of his process has been limited to software companies – mostly SAAS companies. It struck me during a long drive yesterday that it could be used to improve the sales of any team. Teams with a deployed service or shipped product might gain the most.

Involve the whole team

The not-easily-impressed folks might think “Wooo, talking to customers – that’s a super new idea” and they’d be missing the point. Having been involved in many such efforts over the years – my experience is that the POV method is different & better.

It’s different in part because it isn’t about a group of VPs sitting around pontificating about things they’re disconnected from. Why disconnected? Because most VPs no longer spend time customers in the trenches. Even if you’re a owner/VP now, you weren’t always one, so you know what I mean. It’s better for the entire team to discuss progress together rather than in a series of silo’d departmental conversations. When everyone hears from everyone who has data / experiences to contribute, a much richer, more complete picture is the result.

One of the outcomes is the reduction of the pain and suffering required to adopt a product / service and substantially shrink / simplify the timeline from payment to “we’re getting the benefit we paid for”. I remember years ago watching the discovery process unfold during the early stages of a POV conversation about a group’s (non-SAAS) product.

During the discussion, a normally quiet member of the service / deployment team who spent all of their time with customers during the deployment process blurted out something like “Do you have any idea how frustrating our installs are and how long it takes our customers to go live with our software? At least three months!!

The product team’s reaction was shock and surprise, as you’d expect. Because management was part of the discussion, the project got immediate momentum. A substantial and cooperative joint effort between the product and the service departments to substantially pare down install / deployment challenges was the outcome – a small but high impact improvement.

Assembling a grill

Software deployment challenges are common, but deployment problems aren’t limited to software. The longer that the time-to-benefit period grows for any product or service, the easier it is for buyer’s remorse to take hold. If it takes 90 days to get your product or service producing, customers can lose sight of why they wanted the benefit.

It reminds me of buying a new grill, getting it home and putting it together.

If you’ve assembled a grill in the last 20 years, you know that the grill business needs some work. People buy a new grill because the old one finally rusted out, they need more capacity, or they’re having an event & need a bigger one. Most people don’t do this weeks in advance. They might buy the grill a day or two before the big event.

The likely result is one of those “It’s 10 pm on Christmas eve and I have toys to assemble” experiences. Instead of fitting together plastic parts, there’s sharp-edged sheet metal & screws that look alike but aren’t. Meanwhile, two people must hold the pieces in position so the third person can turn a few screws. Eventually, this pile of parts becomes something that will eventually cook a meal. Does it have to be this much trouble?

Imagine if the team(s) responsible for packaging, instructions, & parts watched consumers muddle through this process on a third floor apartment patio. Enlightenment is guaranteed. When a developer watches an end user use their software, it’s often painful because what seemed obvious almost never is.

Whether you make software, grills, or campers – your development, packaging, and deployment staff will learn important lessons simply by watching a few customers unpack, assemble, & deploy your product or service.

Photo by Matthieu Joannon on Unsplash

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Desperate for business?

Recently, I drove past a local shop advertising everything they sell at 50% off. While I don’t like to assume, it’s hard not to wonder if such a radical price cut is anything else but a desperate move to make sales that aren’t happening for the “normal” reasons.

When an owner is desperate for business, (at least) two things often take place in an effort to turn things around:

First, an assumption is frequently made that price is the reason they aren’t selling as much as they need or want to sell. While that is possible, it’s a situation that is easy to research online, much less by listening and asking your clientele. You have to word these questions carefully, since the answer to “Would you like to pay less for what we sell?” will almost always be met with a “Yes!” If you haven’t done this work, then thinking that your sales problems are caused by prices that are too high is an unproven and dangerous assumption. Regarding the store in question… I’ve been in there and price is definitely not their problem.

Second, desperate circumstances manifest themselves in the behavior of sales and marketing. The most common symptom of this is focusing on “everyone with a heartbeat” rather than everyone whose heart beats faster when they see, talk about or think about what you sell.

The latter group is already bought in to the idea of what you sell, so they don’t have to be sold on the idea, but they will need a compelling reason to purchase this product/service from you, as opposed to someone else.

When you focus on everyone, many of them have yet to develop an interest in what you sell (if they ever will). Some portion of them still must be sold on the idea, much less the specific product/service you’re selling and then they must be sold on your ability to deliver it. Selling the idea is often the steepest part of the climb and requires the most energy. Unfortunately, the energy you expend trying to sell disinterested people in what you sell is wasted, leaving less energy for the prospects who actually care about your products and services.

So what’s a business owner to do when sales take a tumble? Ask a few questions.

How’s your value proposition?

Price often comes up first when value proposition is discussed. We’ve talked quite a bit about pricing in the past and the importance of not assuming that your prices have to drop simply because they’re higher than Amazon’s or Wal-Mart’s.

Thing is, pricing is just a part of the value proposition. The ability to provide immediate gratification, convenience, service, delivery, installation, faster delivery than anyone else, financing, access to product / service / industry experts, consulting and better-than-typical guarantees / warranty coverage all have value.

The difference in value prop between the vendor with the best price and the vendor who can roll out delivery, financing, on-site expertise, installation and follow that up with a fair price and solid warranty is massive.

These things take an investment in time, labor, materials and/or people. It’ll be tough to roll them out all at once. Talk to your ideal clients and find out which of these things are most important. Move on those things first. Keep the conversations going.

Why did they leave?

Everyone has clients who have left them, including me. One of the best things you can do for yourself, your business, your next client, and your existing clients is to ask the ones who left what made them unhappy enough to leave.

A few questions to get you started… How did we disappoint you? What promises did we break? What was the turning point for you that told you it was time to leave us and find another vendor? What product didn’t live up to our promises? How did we fail to meet your expectations? What told that you could no longer depend on us? Was price the reason you left? What would have kept you as a client even if our price was higher? What did we fail to offer you that you wanted or needed from us?

The key to all of this is that it isn’t about you. It’s about what they want and need from you. If stuff isn’t selling, there’s a reason. Cutting the price in half isn’t going to find it.

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What are your customers doing online?

I mentioned the Meeker internet / technology trends report last week on Facebook, but I thought I should summarize a few important nuggets from it for small businesses, particularly small software businesses.

  • 30 percent growth in mobile users in the last year.
  • 50% growth in bandwidth use by mobile devices. Specifically, 15% of all internet bandwidth use is mobile, up from 10% last year.
  • Tablet use continues to expand quickly. Apple sold more iPads (140k) than iPhones (60k) last year.
  • More tablets shipped in the last quarter of 2012 than desktops, despite being on the market only 3 years.
  • Photo sharing is on pace to double since last year. Last year, about 375MM photos were shared per day. This year, users have already shared more than 500MM photos per day on average.
  • Wearable device usage is doubling every month so far this year.
  • More people access the internet via mobile device in China than via desktop – in a population of over 560 million internet users.
  • 45% of Groupon transactions are now online. 2 years ago that number was 15%.

I recommend you check out the whole slideshow, even if you aren’t in the technology business. This stuff affects almost everyone in almost every business.

KPCB Internet Trends 2013 from Kleiner Perkins Caufield & Byers
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Meeker 2012 – What should small software businesses do?

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Credit: KPCB

Mary Meeker’s annual Internet Trends presentation is always an attention getter.

For some, a wake-up-call, for others… a reminder.

No matter what it is for you, there’s some valuable trend info there worth looking at in the context of your software business.

“Rapid mobile adoption still in early stages.”

Think about that for a moment. Apple has more than 100 million mobile devices sold (65 million iPads in 8 quarters) and dominates US smartphone sales. Android does the same for the rest of the world…and we’re still in the “early stages”.

This isn’t a surprise, but it’s a common mistake for entrepreneurs to feel like if they aren’t first, they’re worst – and for some, that they shouldn’t even try. Someone has to be first – and sometimes their most important achievement is to show everyone else that the market is viable.

It’s still very early for mobile, despite what you might gather from industry doomers, but there’s plenty of time to be the second mouse who gets the cheese.

Look around your clients’ offices. Are their salespeople 100% mobile? If they have any kind of fleet, are their drivers/pilots? What about their warehouse / lot / logistics people? Are their in-house pickers on mobile devices yet? What about their salespeople? Can they enter a lead, produce and email a quote and close a sale – including accepting a check, depositing a check, getting a contract signature, emailing the signed contract and/or taking a credit card – from their mobile phone?

All of those things can be done today with a phone. You can even deposit a check with your stodgy old bank’s mobile phone app.

What about your product line?

Can they use their mobile phone to perform core functionality like this in your software? My guess is… Probably not.

Some of your software might never be on a mobile device in its current form. Yet parts of it might make sense, particularly for outside sales and other mobile workers. One thing is almost certain: This kind of mobile flexibility will be difficult to avoid in the future because customers will demand it or move to someone else who delivers it.

One of the more challenging aspects of the move to mobile is the cross-architecture requirements. A few years back, you could dictate mobile hardware because phones couldn’t do the work. You’d have customers buy expensive ruggedized Symbol devices and that allowed you to control the scope of development.

Not anymore. Today, you need to be ready to consider adding iOS, Android, WinRT, Java, HTML5 and who knows what else to your development efforts. Now maybe you don’t start development on all of those at once but you’d better be considering how each of them apply in your market.

If you aren’t, are you ready to give up the testimonial-writing, market-leading customers in your client base? They’ll often be the ones who move first to new solutions that leverage advanced technology – even if it’s just to do a pilot and set their next long-term strategy.

Globally, only 18% of people have mobile access, but the growth rate was 37% over the last year. In the U.S., 29% have a tablet compared to 2% three years ago.

Rethink your apps.

“8% growth in internet users, driven by emerging markets”

79% of the U.S. population has internet access today, while only 10% of the population of India has it.

Of that 10%, 44 million use a smartphone. The rest use a mix of desktop/laptop and cell phone. For those who get to the net via mobile device, it doesn’t always happen on a smartphone. Meeker noted that 200 million farmers in India receive ag subsidies via their cell phone.

Intuit recognized this situation early on by having business development people in place in India. One of their success stories there is a service that delivers daily pricing information to farmers via text message. They’re adding 20,000 users a week to this text message based service, which helps farmers get more for their produce at market.

“Suddenly” the translation to Farsi and adaptation to “non-smart” cell phones seems more interesting…

For U.S. software companies, these are areas of concern. At 79%, our climb only has so much headroom left. International is a natural next step given the growth numbers.The U.S. is number eight in growth rate of new internet users, behind China, India, Indonesia, Philippines, Nigeria, Mexico and Russia.

Why worry? Because small U.S. software companies tend to avoid internationalization. Grab 10 small software company product downloads off the net. How many of them support other languages? Other currencies? Other taxation systems?

If internationalization is a problem, how functional is business development outside the U.S. for American companies? How else will you get accurate business development knowledge in those countries? Add to that, many countries have barriers to outside companies building a presence inside their borders – just like the U.S. does.

This is an area of great potential, but it doesn’t come without serious work. It isn’t as simple as running your product’s text strings through Google Translate.

Don’t forget Android. In 13 quarters, Android has lined up 250MM mobile phone users, with the majority outside the U.S.  Combine that with a different platform with many different screen formats and this is where you mull over your answer to “How bad do you want it?” when looking at the potential return.

Smartphone upside

As the smartphone enters the developing world en mass, there’s still a big upside. In the U.S., we think we’ve seen it all. Globally, there are 953 million smartphone subscribers. Seems like a lot, after all that’s about 3 times the size of the U.S. population.

Yet for all mobile phones, the smartphone subscribers number jumps to 6.1 billion (see image below). Compare those two numbers carefully when considering your near term app strategy.

Many would suggest you build a smartphone app for these developing markets ASAP. I suggest you consider where you are now before taking that step. In particular, think about “the reason to get a sale“.

Show me

Many will read these numbers and think “Yeah, but…”  The “but” is about where the buyers are and where the traffic is.

Currently 10% of global internet traffic is mobile. It was 4% two years ago.

What about buyers? Meeker said 8% of e-commerce is mobile-based and that the click through rate on mobile is still 1/5th of what desktop click through is.

8% globally is a big number and has little choice but to go up. Can your site handle it? Can your clients’ sites?

In India, there is now more mobile-based internet traffic than there is traffic from desktops/laptops. Breathe that in before your next long-term product strategy meeting.


These three graphics tell a lot of stories. There is one thing they don’t say.

One thing these graphics don’t say is “Who’s next?”

Spring Training

That’s how early things are. Meeker called it “Spring Training” because there are so many opportunities related to the net and mobile that the season really hasn’t started. Maybe in the U.S., we’re jaded to the opportunity that remains because we have this habit of assuming that everyone is like we are. 15 minutes on your tech support line will clear that up.

For those willing to think and work differently…different results are possible. Look back over these slides and my comments. How will they, how could they impact your business?

Thanks to KPCB, I’ve included the slide deck here…

View this document on Scribd

The other shoe

Meeker’s talk wasn’t all good news. She referred to KPCB’s now-famous (and sobering) USA Inc. video/report that looks at the financial performance of the U.S. as if it was a business. Regardless of your politics, it’s worth a look. An October 2012 USA Inc slide deck is here and the 2011 video is here.

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How do you decide what success means?

Ask any two people what success means to them and you’ll probably get two different answers – even from people who are in business together.

When you design and plan the rollout of a new product or service, you probably have an idea how you’d like it to perform in either sales units or dollars.

Or maybe you get an idea, decide it’s a good match for your customers/market and that’s enough to decide to build it.

Have you done that and then found that you built something no one wanted – or maybe that the market just wasn’t ready for the product, despite its merit?

I’ve done the latter. It isn’t fun when 30 customers in a sizable market get it and the other 20,000 don’t.

How do you know for sure, rather than by gut feel, that the effort invested in a new project is a success?

Ready, Fire, Aim?

In the software business, a pilot (or “proof of concept”) project is often used to determine if a project is viable.

If the reaction from enough customers provokes us to build it, then it might get built without a second thought. On the other hand, if the customers look at you with their head cocked to the side like a dog that just heard a “silent” dog whistle, you know we have some adjustments to make.

But…there really ought to be a step before that “not a second thought” part. Again, how do you know for sure that the effort invested in a new project is a success?

“More income or more customers” is an answer to “What do you want to gain from this project?”, but it isn’t necessarily a well-thought out, strategic one.

Strategic how?

Would it be useful to be able predict success? What things would you consider as “clues to success” before building a new product?

How about these: Financial return, number of new customers acquired, annual and lifetime value of newly acquired customers and types of customers gained/retained? Some customers are “worth more” than others. Some are a better fit to your business than others. Should a new product attract their attention? Should it push the “wrong kind” of customer away?

To simplify that list: Have you ever considered a product’s lifetime financial and strategic value *before* you built it?

Wouldn’t you want to know business outcomes in advance? Knowing that before before testing, much less before investing time and money into it, would likely help you make better decisions about design, pricing and more – including whether you should even build it.

Remember the old (and accurate) insurance sales saying “Most people don’t plan to fail, they fail to plan”? While planning doesn’t deliver the project, the mere presence of a well-thought out plan tends to result in better execution.

Better execution of what? For what time frame? How do you get from here to there – and at what level of performance?

You can’t just follow your nose. You need a map so you know when you’ve arrived or how much is left on the journey…or when to turn back.


This map concept is useful for contract work as well.

One of the things I do with clients when we get started on a project is produce a specific list of characteristics, outcomes, and deliverable items that the project will produce. It’s common ground that the client and I agree to in advance so we both know the meaning of “successful delivery” before we start.

Some projects, and some clients, require more detail than others – but the result is always a list of things that say “This project has been successfully completed as the client requested.”

Even so, when I think we’re done, I’ll ask “Is this what you envisioned when we got started?”

I do this because something that often derails a long business relationship is getting that “Are we there yet?” thing resolved so that both parties know when it is time to get paid. Getting paid revolves around agreeing on what “successfully completed” means. The “envisioned” question provokes more than a yes/no answer, which is exactly what I want.

While that list of outcomes/deliverables keeps us both accountable for knowing what success means, it doesn’t get us there.

That requires execution.



I am blogging on behalf of Visa Business and received compensation for my time from Visa for sharing my views in this post, but the views expressed here are solely mine, not Visa’s.

Visit to take a look at the reinvented Facebook Page: Well Sourced by Visa Business.

The Page serves as a space where small business owners can access educational resources, read success stories from other business owners, engage with peers, and find tips to help businesses run more efficiently.

Every month, the Page will introduce a new theme that will focus on a topic important to a small business owner’s success. For additional tips and advice, and information about Visa’s small business solutions, follow @VisaSmallBiz and visit

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How to find their path from new customer to great customer

Creative Commons License photo credit: c_ambler

Last time we started a conversation about growth and left it off with a brief discussion about digging deeper into customer behaviors.

In particular, we were starting to look at the behavioral signals that indicate your best clients or simply the signals that show they’re about to become a customer. Either way, it’s valuable information to have.

To continue from where we finished last time, let’s turn one of my final comments from the last piece into a question: “What behaviors identify a person about to buy?” and “What behaviors identify potential ‘ideal’ clients who are already a customer – but haven’t transformed into that ideal customer quite yet?”

Order history helps

When we’re looking for behaviors that indicate what a great (“fanatical”, to use Rackspace’s lingo) customer is, one place to look is order history.

Your order history is rich in information that can help your detective work on buying signals and customer behavior.

I know, you want some examples of what you might look at. From gut feel, identify your five best customers, using whatever means you use to determine “best”.

Your business may not fit all of these questions I’m about to ask, so look at them in a way understand that they might require a slight adjustment. It’ll depend on what you sell, how you sell it and how rich your product line is.

The questions:

  • How often do they buy from you? In other words: What’s the average number of days between purchases?
  • Does transaction size increase over time or does it shrink over time?
  • Of the customers who buy everything you offer, do their purchase intervals or transaction sizes “look different” than everyone else’s (on average)?
  • If your best customers don’t buy everything, what do they buy that no one else buys? Of those people, study the behavior prior to that particular purchase. What did they ask? What did they buy just before that?

Now…looking at the patterns that these “best” customers have established, what *existing* customers fit the early part of those patterns? These are the customers who are likely to join the “best customer group”. The difference is that you know the candidates in advance.

Not all of them will move into your best customer group, but in watching this process/movement, you’ll eventually learn what behaviors indicate that move.

Interaction clues

Look at your interaction data for each class of customer. When I say “class”, I mean your best customers, your newest customers and so on. You need to look at each because you’ll need to be able to detect a behavior that occurs when a customer moves from one to another.

When they do that, they’re sending a signal. Your responsibility is to act on it.

Interactions include sales and support inquiries, price list requests, orders, email (including subscribes) and the like. Remember “guinea pigs” vs. “guinea pig” from last time? Your most important indicator of “I’m going to be a great customer” could be that subtle.

Interactions and order history indicate future behavior. Your best customers’ behavior is there and shows patterns along the road to “BestCustomerVille”.

Misunderstanding metrics

By now you’re probably wondering about the not-too-standard things that I’m suggesting you observe. What about standard metrics? Where do they fit in?

Standard metrics, like the number of customers you have, the number of leads you have, the number you add each day/week/month, sales this month vs. last month and so on are certainly worth looking at, but remember that they primarily indicate *where you are*, not what you need to do to (re)produce those gains.

What do you learn from knowing that you have 1344 customers today and that you had 912 customers this time last year? Unless you look in the context of what resulted in the net gain of 432 customers, you learn little that allows you to reproduce that gain.

That’s what you want to know and repeat.

A “You are here” marker doesn’t help much if you don’t have a map. The behaviors we discussed are part of the map that shows you the path from new customer to great customer.

THAT is why we’re talking about behaviors. They are the invisible signals you have to detect.


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A conversation about growth

Recently I was involved in a conversation on producing business growth.

The discussion revolved around what to measure about the business in order to keep track of the growth.

A few things to start:

Don’t make things complicated. Be sure that you’re measuring the right things. Historical data has some value but the good stuff – the transformative stuff – tends to revolve around things that indicate future behaviors (or not) of your customers.

When the conversation started, I referred to a few blog posts to help the conversation move into the right frame of mind about how to be thinking about growth, including:

In these conversations, there’s often a struggle with *where to start*. Ask yourself what’s important.

The answer in this case? Getting more customers.

Getting customers

Working on the assumption that “customers” meant getting new ones, I asked what clues prospects give that they are going to become a customer. Remember last week’s discussion about “invisible” signals? Customers/prospects give signals as well.

I didn’t really get what I was looking for regarding buying clues, so I started thinking about a way to reword the question. Why? Because lack of good answers tends to indicate that I’m not asking my question with the right words (think about that positioning vs. the more common “my customer is an idiot” framing that some default to).

Before I could reword the question, I was asked how one finds out what a person does before they become a customer.

A few answers might be: They become a lead. They join your email list. They ask you to send your newsletter. They call and ask for a brochure or prices. They stop in and kick the tires. Each of these sometimes subtle behaviors will signal where they are in the buying process.

Speaking of subtle, there’s a notable case where incoming Google searches in plural (ie: “guinea pigs”) were almost always new leads just starting to investigate the topic and singular searches (ie: “guinea pig”) were almost always searches done by people who were ready to buy.

You can’t get much more subtle than that. Paying attention to what your leads and customers are doing at that level was enough to substantially transform a website user’s experience and vastly improve sales. That’s the kind of signal that can transform everything.

If you think about these behaviors, you can come up with the things people say to you when they contact you or visit your business. They might say “Yeah, we just had a new baby so we’re looking for a new car / looking for a new house / buying carpet / selling our motorcycle or however they do business with you.

You know the clues, but you might not be thinking of them in that way.

Getting a plan

It’d be great if there was a single “golden spreadsheet” that every business could use to figure out these things. Unfortunately, it doesn’t really work that way.

While numbers like cost per lead (CPL), cost per customer (CPC) and lifetime customer value (LCV) are absolutely critical for every business because they tell you which lead sources send you the highest quality customers, how much you can afford to pay for advertising and much more – they don’t tell the whole story.

Many businesses ignore LCV and try to pay as little as possible for advertising. Trouble is, LCV is a very important number in the big picture of your marketing and metrics because it reflects buying behavior.

That behavior is what you have to decipher. Like the analysis of lead sources, such as which leads give you customers with the highest LCV, which leads give you the customers who have the most returns; behavior of your existing leads and customers helps you find more of the “right kind” of customers.

Customers and prospect behavior frequently falls into patterns. While there are always exceptions, it’s wise to identify a sequence of behavior – particularly for the folks you most want to have as customers.

Digging deeper

Getting more customers is sometimes (not always) the easiest way to raise more revenue. The other two most common ways to increase sales are sell more to your existing customers and sell in bigger transaction sizes. To do that, you have to know more.

Study what your most profitable customers buy, how often they buy and how long they wait to buy after you introduce a new product (or make an offer) to them.

Sometimes these folks simply buy everything you make, it’ll depend on your business. Sometimes they buy the best products you make. Your order data will reveal much more than the Magic 8-Ball.

These steps will often help you understand who is, but hasn’t yet transformed into, that ideal high-profit customer.

We’ll hit this topic more next time.



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Starting a New Business: Part 2 – Are you ready?

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Last time we talked briefly about things to consider in the early going of the business you just started.

We talked a little about the product/service, but focused mostly on some basics about licenses/permits and getting supplies with a little taste of business model talk.

The reality is that we shouldn’t have talked about most of that stuff, but we had to start with that conversation because it’s the type of thing new business owners expect to hear.

You might be thinking “I’ve already got a product, I’ve already got a business (even if it’s only a few days old) and I need to know what to do to start. NOW. RIGHT NOW. So help, already…”

Problem is, that’s not the best place to start if you want to build something lasting.

Fake left, go right

Sorry for rushing ahead last time, but I wanted to get you into analysis mode just a little bit before we moved ahead (or back) to this step.

We did talk briefly about the business model and I hope that provoked you a little. Ideally, it made you think that you might not have all the info you need to work out the details of your model. Those of you who thought hard about it probably wondered if you didn’t have a lot more work to do.

You do.

Before you order those business cards, buy those supplies, determine your costs and set your prices…you need to research your market.

This means far more than doing a keyword check to see how many Google searches there are for “gold plated harmonica” (if that’s your business), much less finding out if is available and at what level the competition is already delivering these items. Those things are just part of the process.

Questions, questions

How much do you really know about the market you’re entering? Assuming the market isn’t brand new, have you researched industry product, service, supply and performance trends? What do they indicate as areas of opportunity? Areas to avoid? What are the emerging product/service trends in this market?

Are you familiar enough with your prospective ideal customer to enter their market? Or will you stand out in the wrong way and alienate your business from them?

Who buys gold plated harmonicas? Where do they live? What kind of stores do they purchase music supplies in? What else do they buy at the same time? How many are sold per year? Where are they purchased – online, in stores or both? How many are purchased annually? Are their peaks and valleys in purchasing habits? Are there peaks and valleys in supply? Are there legislative, import or similar issues that you must deal with at startup or on a one-time basis? Are there any liability concerns for the product and its use?

How many do they buy over their lifetime as a purchaser of gold-plated harmonicas? Is there a progression of better and better purchases? Is there the possibility of referrals by your existing customers to others who favor gold-plated harmonicas? Are there opportunities to render service, deliver purchases or offer training classes?

At what age do people start upgrading to gold-plated harmonicas? At what age do they stop purchasing? How do people decide to be in the market for gold-plated harmonicas? What do they buy in the year or two prior to moving up to a gold-plated one? Where can you buy replacement parts? Is there a repair market or do people replace them? Is there a scrap market? (they are gold-plated, after all)

Who dominates the market today? Why do they dominate the market? What will you do to set yourself apart from them? Is it possible to partner with them?

These questions come into play when writing a marketing plan but many of them also have bearing on your business model / business plan.

Are you asking enough of the right questions? Are you doing the research necessary to assure that your business plan / model make sense given the market of available buyers?

These questions are not intended to scare you out of a market. Quite the contrary, they are intended to make your entry strong enough to keep you there.

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Show them the ladder

On many occasions, I have advised you to offer higher-priced, higher-value products and services because they focus you on high-lifetime-value customers whose loyalty extends beyond what’s on sale this week.

Likewise, we’ve talked about using those higher-priced products and services to “subsidize” the value-priced part of your business so that you can find more high-lifetime-value clients from that group.

What I’ve been urging you to do is build a customer ascension ladder.

It’s not like you haven’t seen this before. You’re probably on several of them and might not realize it. Despite that, it’s entirely possible that you haven’t used it strategically in your business.

Ladders you know

Take a look at Kraft cheese.

If you want sliced cheese in a wrapper, you might buy Kraft Singles. In their product ladder, Velveeta Slices are a bit of a luxury item. To step beyond that, you have to go to a higher-priced Kraft brand name like Cracker Barrel and you might have to slice it yourself.

Some of you might never buy these brands, but if you buy cheese, you’re in another vendor’s cheese ladder (Kraft may own them too).

A simple ladder that everyone is familiar with is car brands.

Ford Motor Company has Ford, Mercury and Lincoln. General Motors has Chevrolet, Pontiac, Buick and Cadillac (among others). These brands illustrate simple ascension ladders.

Back in the olden days, your typical Chevy customer longed to step up the ladder and get a Cadillac someday and in fact, doing so was a sign to their co-workers, friends and family that they had “made it”. Likewise, many Ford customers longed to own a Lincoln Continental.

Today, things are bit more muddled in the car business and these things aren’t the universal success/status symbols like they once were. F250’s, Hummers and Escalades have supplanted them to some extent, illustrating that the idea and the desires are still valid.

Where’s your ladder?

What works for Kraft, Ford and General Motors also works no matter what you sell.

The ladder works for firewood, imported crystal, septic tanks or legal services…and for whatever you do.

Whatever you sell, you can usually sell more by designing an ascension ladder for your customers. It isn’t just about selling more, more, more. It’s about matching what your customers want to what you sell…which tends to make you sell more.

If some of your customers need/want an Escalade and all you sell is Yugos (the “Mona Lisa of bad cars“), you’re going to lose them. If selling Escalades isn’t your thing, that’s fine. Even so, deal with it strategically as you should know how long this progression takes based on customer

You may already have a makeshift ladder in place. It isn’t like “good, better, best” is some sort of secret of brilliant business owners.

What you seldom see is a business strategically designed to move people from through the tiers of “good, better, best”, identifying the most likely “best” buyers based on their behavior, buying habits and other factors (such as demographics and psychographics).

Designing your ladder

Take a hard look at your customers from end to end. Do the same with your prospects, who tend to be substantially different from your long-time customers.

For example, consider the differences between a customer of 20 years who is starting to think about retirement and a customer who just got their first job. Their needs, values and *what* they value day-to-day might be completely different as it relates to your products and services. “First job” is just one example and may not have any impact on their choices for what you sell. Something else definitely will, so pay attention.

If you take this task seriously, you should be able to segment your customers into groups based on any number of things from age-based needs to buy frequency to number of calls for help. You may find that there are correlations between any of these individual segments.

What you’re looking for is segments that would respond positively to the same message, the same product/service offer. Other customers might use a different version of the same service that may not interest this particular group. Thus, the importance of the message/offer.

Next….Show them the ladder you’ve designed.

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Uncertainty and Starships

Today’s uncertainty has a tendency to freeze people’s behavior.

It makes us forget, even momentarily, that doing nothing or continuing to do the same old thing may be more risky than doing that next big thing on their strategic plan.

That doesn’t mean you have to take giant expensive steps like people did in 1999-2000 or in 2005-2006 when almost anyone could act big and get away with it.

When everyone else is hunkering down, even more opportunity is left available to the observant and aggressive – even if they are careful.

Are you looking at mergers, acquisitions, strategic partnerships, cross-marketing, new markets, derivatives of your existing products and services? Are you looking harder than ever for those things that can bridge you into your next big thing?

Those are all worthwhile things to consider, but have you considered your customers’ situation? What has today’s economy done for their needs? What’s the uncertainty done to them and their customers?

Have you visited your customers lately, even if you have to do so by phone, Skype or Facetime? What’s on their minds? What’s their biggest concern that didn’t exist a year (or 3) ago? How can you help?

Sometimes a quiet moment of thought yields ideas that your noisy day, week, month wouldn’t let through any other time.

Likewise, a quiet conversation with your smartest customer.

  • What can you show up with that would provoke an Aha! moment?
  • What can you do to tighten your relationship with your customers?
  • What would seal your reputation in their minds as as business that is all about making sure they are doing well?

People start businesses for a lot of reasons. They aren’t necessarily doing so for the comfort of a job but often for something else. Perhaps for the same reasons man will someday step onto the deck of a starship… because risk is our business.