• Innovative Strategies That Create More Profits

Author: harborcapitalgroupinc

Want A Creative Solution To An “Unsolvable” Problem?

Posted on by harborcapitalgroupinc

 

There Is A Creative Solution To Most Problems

 

You’ve done your research using (your analytics and other diagnoses) on the problem. Now you need a creative solution.

But all the research and data have looked backward at the information and concepts you already know.

You have to look forward, not just backward, to get an insightful or creative solution.

The way you do that is to use creative problem-solving techniques and tools.

If you do, you will be able to create a solution to your “unsolvable” problem.

 

 It isn’t that you can never get insight from all that research.

It can happen, but your mind already has all this information.

Your mind must be confronted with something new or different, requiring it to take an unfamiliar concept or word

and fight to fit it into your current mental database.

Therefore, the mind must fit this new word into what is already known and create a new concept.

Here is a simple example of how the creative minds works

Creativity is simply looking at things differently. Edward de Bono, in his book “Think,”

explains how the mind works this magic. Your mind continuously builds up knowledge over time.

Following is a game he uses to illustrate how the mind works. 

Start with the letter’ a’

Add the letter ‘t,’ and the new word is ‘at.’

Add ‘c”. The new term is ‘cat.”

Add o’. The new word is ‘coat.’

Add ‘r.,’ And things have to change. The new word is ‘actor”.  

But the letter ‘r’ required the mind to restructure the use of the previous words. This process is creativity.

Therefore, you need to get your mind off the traditional path to get new ideas.

A goes directly to B (the pattern already in your mind) and moves at a different angle

from the conventional thought pattern.

For example, you could use a random word to disrupt your known routine

and asymmetrically open your mind to a new way or idea you can choose to use or not.

This process also means that anyone can accomplish creativity.

It is a skill, not an exceptional talent only some people have.

Here is a great 4-minute video on creativity by Edward De Bono that you should see if you have time.

Use random word techniques to achieve creative solutions

You want to start by selecting some random words as your starting points.

One of the best ways is to use the dictionary. Open the dictionary to a random page,

put your finger on a random word, and select the closest word (a noun).

Choose about five more words. Write them down. 

 

Be sure you know the definition of each word because you will associate the characterizations of each word

with your focus idea or question (for example, create a new concept for a restaurant.).

Focus on the word and relate it to the question or problem you want to be solved. 

Work quickly through each word, but don’t judge your responses now.

Each idea response represents the possibility of a great idea.

Spend about 5-10 minutes exploring each random word. 

 

For example, focus on a concept for a new restaurant  Random word: wallet.

One concept would be a restaurant where people order food, pay immediately,

and take the food elsewhere to eat vs. ordering in, eating the food at the restaurant,

and only paying after eating. 

A restaurant where people are charged by the amount of time they spend at the restaurant. 

A restaurant known for one special, unique and expensive dish served at one particular time every day.  

This is only one creative technique of many. But, this random word technique is easy to use and can be done quickly.

We cover other techniques for individuals and teams as well.

 Creative Solution Concepts

According to Merriam-Webster, a concept is conceived in the mind: a thought, a notion.

For example, the concept of gravity.

The importance of concepts is developing alternatives and new ideas

by extracting the image and looking for ways to deliver this concept through a specific idea.

Ideas are a way of putting the concept into action.

The concepts you create can be functional or operational, and these concepts can be vague to very detailed.

You can create value concepts (why is this a value?)

Or purpose concepts (why are we doing this?) Also, descriptive ideas.

 

The importance of concepts is developing alternatives and new ideas

by extracting the concept and looking for ways to deliver this concept through a specific idea.

Ideas are a way of putting the concept into action.

There can be functional or operational concepts describing how something is done, from broad to detailed.  

There can be value concepts (why is this a value?)

Or purpose concepts (why are we doing this?)

And descriptive concepts.

Try this creative solution technique for yourself. 

Try it on a focus of yours. Take five words and give yourself 5-10 minutes for each word.

The more you do, the more you learn and the more ideas you will get.

Conclusion

You have to look forward, not just backward, to get an insightful or creative solution.

The way you do that is to use creative problem-solving techniques and tools.

If you do, you can create a solution to your “unsolvable” problem.

Creativity is simply looking at things differently.

Therefore, to get new ideas, you need to get your mind off the traditional path A to B

(the pattern already in your mind) and move at a different angle from the traditional thought pattern.  

The random word technique is a quick and efficient way to generate new concepts and ideas. 

The focus on a new kind of restaurant is an example.

The concepts you create can be functional or operational and can be very broad to detailed. 

 

To learn more about “How to get a creative solution to that “unsolvable” problem,” go to our website: https://https://harborcapitalgroupinc.com/wp-content/uploads/2024/07/Braintopview-1.jpg.com. 

PS. You may also be interested in our blog post:   https://https://harborcapitalgroupinc.com/wp-content/uploads/2024/07/Braintopview-1.jpg.com/a-strategy-for-business-growth-jim-zitek/

PPS. This post may be of interest as well: https://https://harborcapitalgroupinc.com/wp-content/uploads/2024/07/Braintopview-1.jpg.com/want-better-sales-results-tell-your-real-story/

Thanks for taking the time to read this, and I hope it gives you some food for thought.

Jim Zitek

 

Why Your Business Growth Strategy Is Your Story

Posted on by harborcapitalgroupinc

Solve Their Problem, And The Money Is Yours.

 

 

 Many companies do not reach their revenue and sales goals.

A primary reason is that they jump right into marketing as a way to achieve their goal quickly.

Marketing tactics alone, while important, will not solve the customers’ problems. That’s your job. 

You need to tell prospects your real story, and the real story is your company’s insightful solution to their problem:

your business growth strategy. 

Your business growth strategy is your story. Marketing is how you tell your story. 

That’s the story you are passionate about because it solves their problem.

Solving their pain, as you know, is why you need a strategy first.  

 I think the “strategy is your story” line is from an article by Ben Horwitz

You need a strategy to solve your prospect’s problem to reach your goal.

Without a strategy, there is a big hole in your story.

You need to fill that hole. So, to get on track to meet your revenue goals, you first need a strategy (your story),

and only after you have your strategy can you effectively and passionately market your story.  

With a strategy, your product or service solves a targeted customer’s problem in a better or more desirable way.

Plus, a strategy includes a reachable and measurable pathway to reach your sales objective.   

A strategy also makes your marketing cost-effective.

Your message will target and focus on the specific solution the customer needs and wants.

There are five parts to creating an effective business growth strategy. 

 Following is a very condensed description based on Richard Rumelt’s book, Good Strategy/Bad Strategy.   

1. Understanding your goal and the number one problem in reaching that goal, then turning that goal into a specific, measurable objective.   

2. You need to diagnose the problem based on experience, research, analytics, and critical thinking skills, so the information is as objective as possible. 

3. Next, create new insights and concepts using creative thinking tools to solve the problem or take advantage of the opportunity. 

 4. Once you have the insightful solution needed, you need to define what the company will do and not do

This step is difficult because it means many” no’s” because of limited resources.

5. Finally, prepare a coherent plan to execute this strategy.

Now that you know your company’s growth strategy (story), you can begin telling that story.

But, your marketing program needs a strategy also because the market is very crowded.

And you have to stay coherent with your business strategy.

For example, about 70 million posts are made each month on WordPress  

So, how will you compete against all the other marketing messages?

You must be on page one or two of “Google’s” search results. 

 

Competition is stiff if you use inbound marketing like websites and blog posts.

You must have a strategy for your marketing programs, using the same process described above for the company strategy.

What can you say or write differently, uniquely, and on point with your strategy?

Most visitors do not go beyond the second page of Google’s results.

Therefore, you need a strategy to get your blog posts seen and then read.

And this problem exists for all the media. It’s not impossible, but it takes a plan and some time to accomplish.

Your marketing plan may include outbound marketing (like direct mail and advertising) and direct sales.

Most people are familiar with the different marketing platforms and programs, so I will not cover them here.

Allocation of resources

Strategy is also important because it requires you to allocate resources to the entire company program, including marketing.

Every company has resources that are limited for marketing also.

So, spend enough time and resources to make each program successful.  

Don’t put 100 dollars into ten programs because you want many leads.

You may have to put the $100 into one program and make that program successful.

Then you can expand into the next scheduled item.

With a business growth strategy, you can get measurable results.

Two words of caution

Marketing programs also take time, a precious resource, especially for “free” social marketing programs.

Also, marketing programs need to be tested and adjusted as required.

For example, $100 for advertising may need to be scheduled monthly to get the exposure frequency high enough to work.

Or you may have to plan $25 every three months. 

Also, focus on only the marketing plans and programs that support your overall strategy.

Every employee and every program must sync with your company’s business growth strategy if you want to deliver what you promise in your marketing messages. 

Remember, your strategy is your story, and marketing is how you tell that story.

The following are three ways to move your company forward and reach your goals.

If you want to create a business growth strategy or update your current story, Harbor has three ways to help you.

These three programs enable you to design and decide what you need and how much time you can devote to creating your company’s programs.

 

The ClickVisor internet program gives you the information you need anytime.

You don’t have to hunt for the info. Just click and learn.

Plus, new information is added weekly and monthly.

The data is divided into modules to access the information you want quickly.

 

Workshops discuss specific strategies like defining and articulating your value proposition.

Learning various innovative techniques to create new concepts and ideas, how to

create your Brand or differentiate your products and services, or how to

position your Brand against the competition to become the preferred choice.

  

Consulting Program is custom-designed to help you transform challenges into opportunities and

benefit from the power of business and marketing Strategies.

 They are one-on-one or team designed to help you through the entire strategy creation process.

If this program interests you, we will need to set up a phone appointment to discuss what needs to be done.

 

 Conclusion

 

There are many reasons companies move forward too quickly by spending money on marketing programs; just to be disappointed,

You need to have a strategy defined and in pace first.  Then you can create an effective marketing program.

If you take the time to get your strategy right first, you will save a lot of time and money

and have a higher probability of reaching your objectives.

 

To learn more about the concept of your strategy is your story. Marketing is how you tell your story;

go to our website: https://https://harborcapitalgroupinc.com/wp-content/uploads/2024/07/Braintopview-1.jpg.com. 

I would love to hear your thoughts on having a written business strategy. Comment here.

 

PS. You may also be interested in our blog post: How you approach problem-solving matters.

PPS. And this post also: How To Define And Solve The “Real” Problem

Thanks for taking the time to read this, and I hope it gives you some food for thought.

Jim Zitek

Innovative Strategies That Create More Profits

7 Effective Business Growth Strategies

Posted on by harborcapitalgroupinc

Business Growth Strategies To Increase Revenues

 

 

 

After a difficult two years, and maybe another challenging year coming up, it may be time to update your current strategy

or create a new strategy to help deliver revenues and profits.

These 7 effective business growth strategies to increase revenues can help you do that.  

 Your business strategy covers much more than revenues; no one would read a blog that long.

So the focus here is on business growth strategies that create revenues.

Before we get started, a word of caution, because of the current economic situation and rising inflation, you have to put all of these strategies in perspective.

You may have to cut some expenses to raise money to implement new strategies, these strategies, 

Also, it’s essential to focus on your long-term goals. All right, let’s get started.

1. Increase Market Share Or Market Penetration

Of course, the way to do this is to keep trying to sell more products or services to your existing market.

Go back to your basic strategy model and reevaluate the initial assumptions you used to create your strategy.

But, do it for a positive analysis (how may I increase sales to our market?),

and Don’t use a negative statement (why can’t I increase sales to our market?). You are looking for new answers, not excuses.

For example, you might consider adding additional products or services.

Focus on a few products and increase the promotional budget on other products.

You can lower your costs on some products and use the savings to invest in other products.

You can also resegment your markets with a special offer, maybe find different suppliers, can you improve any of your current products, and more.

2. Develop New Markets 

Developing new markets is an excellent way to expand your revenues.

Not easy, but worth the time it takes to analyze the opportunities.

Looking for new markets should be something constantly on your radar.

Anticipating future events and changes is a powerful way to leverage your growth strategy.

For example, Chan Kim and Renee Mauborgne’s book, “Blue Ocean Strategy,”

an analysis where you make a graph isolating each prominent feature of your company and your major competitors and the value customers put on each element.

This analysis quickly visualizes the differences between you and your competitors and should give you some food for thought.

You should get ideas on where to be more competitive and areas that may be open to new product entrants into the market.

3. Alternative Channels

You may already use different channels like LinkedIn, Facebook, Instagram, Twitter, and others.

Many other channels are now available, and the list is growing, including Parlor, Substack, and individual platforms.

Also, there are podcasts on every topic you can think of, and most are looking for people to talk to be on the show. 

Remember, however, that each of these additional channels will take a considerable time for you to use,

respond to and create material for use on the channel.

So, keep the number of channels in line with your available time.  

4. Product expansion

 

Product expansion is a great way to get additional penetration into existing and new markets.

Maybe it’s time to explore some of the product or service ideas you have thought about for some time. 

Also, you can use “creative design” to develop many new products or services.

You may not be able to think about new products and instantly come up with some ideas,

but you can use creative thinking tools. 

For example, anyone can use the “random word” tool and generate many ideas in minutes.

You pose a positive question and then use a random word (a noun) and apply the characteristics of that word to your positive question.

More information on this tool is available on our website and blog.

If you want to explore new products or services with a group of employees, you could use the “six hats” creative tool,

which is designed for groups and is much more effective than the old “brainstorming” technique.

You can also find more information about this innovative tool on our website and blog.

These creative tools are from Edward de Bono’s many books on creative thinking.

5. Market Segmentation

 

There is more to market segmentation than demographics.

Market segmentation is another practical possibility to achieve your business growth strategy.

If your market is large, you can use a different lens to look for new areas within that market,

like product purchases that go together, levels of usage, or psychographics or mindsets.  

If your market is small, you may be able to divide it into even smaller markets

or “splinter” markets by the customers’ own perceived product value.

For example, the auto industry is large but divided into many niche markets.

But, within these niche markets (e.g.luxury cars), there are splinter markets (they still have to be large enough to be profitable).

Think BMW, a luxury car for special people that want the “ultimate driving machine.”

Of course, you have to deliver that promise.

So, the entire company must sync with the strategy to deliver the promise.

And with a strategy, everyone should be in sync with the strategy.

Remember, your business growth strategy is your story, and marketing is how you tell your story.

Strategic Partnerships

 

Joining forces with other companies is one way to expand your reach and product capabilities.

Theis relationship should benefit both companies.

It could also be for reasons other than sales. You could get skills and resources that you don’t have and could use.

You could also go to act.com for additional information on the administration of working with many people.

This partnership could also be for sales. For example, you could exchange client lists or referrals to companies

with complementary products or services.

You are not in competition with each other; you complement each other.

Market Disruption

 

Market disruption means introducing a new product into a new market.

This idea started with Clayton Christensen and the concept of entering a new market with an inexpensive product and limited functionality. 

The large companies would ignore this new company because of its limited functions and low price, meaning no margin.

Then, the new company starts adding additional functions and value and, at the same time,

keeps getting more and more of the market.

Done right, in time, the company will become a significant player in the market.

  

Other business growth strategies

 

There are some other strategies out there that are more limited to specific kinds of businesses.

In other blog posts, we will write about these (like franchising and licensing deals).

 

Conclusion

 

The 7 effective growth strategies to increase revenues listed above are some of the ways you can become a more robust and profitable company

— especially in the challenging years ahead.

To stay on top of your market, it would be best if you continued updating your strategy

and anticipating new trends and opportunities to improve your business growth strategies. 

 Jim Zitek

 

PS. You might also be interested in our blog: Why your business growth strategy is your story

PPS. Also, check out: How To Turn Negative Problems Into Positive Results.

If you want to update your current strategy and need to create a new strategy, go to our website.

You can get started today for only $39 per month for three team members and no contract.

 

What Is Customer Lifetime Value? LTV

Posted on by harborcapitalgroupinc

What Is Customer Lifetime Value? LTV

 

About 55% of companies with increasing revenues think customer lifetime value is “very important”, and 29% of companies with flat or declining revenues do not think it is very important according to a study by Hubspot. Which group makes more sense to you?

Here is why Customer Lifetime Value (CLV) is critically important. it determines how much you can spend to acquire a new client based on your current client’s profitability. It gives you a picture of your business’s short-term and long-term status and financial viability.  It is also an indicator of product-market fit, client loyalty, and recurring revenue from existing clients.

When you know what a customer will spend with your business over time, you can consider more options for long-term planning. Yes, it does take some time depending on the depth of information you need. For example, knowing what the customer lifetime value is for each market segment is also very important. If you are a SaaS company and need extensive information almost daily, there are companies like Baremetrics that have the measurement and management tools to get you to the depth of knowledge you need.

There are two basic ways of calculating CLV, depending on what data you have available.

1 Accumulated data

If you have historical sales data, this method is far more accurate. It puts together all orders by individual customers to get their own real CLVs. 

2 Average estimate

If you don’t have granular data, you can estimate an average by the following formula: Average order value times number of orders per year.

How to calculate Customer Lifetime Value

For instance, if your customer base will, on average, buy ten times per year at $10 per transaction (or $100 per year) for ten years, the lifetime value of a customer is $1,000 (minus costs). If your profit is 25% of sales, the CLV is $250 (25% of $1,000). Therefore, you could technically afford to spend $250 to attract a single new customer. However, many marketers suggest that you do not spend more than 33% of CLV or, in this example, would be $82.50.

Another view. If you could improve each of the three CLV numbers by 10%, you would increase profits by 33 percent, giving you a profit of about $332 (plus $82). This additional profit could then be added to your marketing budget to grow even faster the following year.

Now, how can you improve each element of your customer’s lifetime value? 

Now that you know the lifetime value, you want to spend some serious time examining how you can improve your revenues and profits. This information will also give you a long-term look at your business and help you plan for the future. To improve your results, you should do the following things sequentially: 

  1. Increase the dollar amount of each sale to a customer. 
  2. increase the frequency that customers purchases from you. , 
  3. Try to increase the number of products or services you provide for your customers.
  4. Then, you can begin to increase your market share by going outside — to increase your market share by working on your competitor’s customers.

This process also forces you to look at different market and customer segments. For example:

  1. Who are your best customers and worst customers using CLV? How can you get more of the good customers and maybe less of the lower value customers? 
  2. Which products provide the most revenue and profits? Can you add value to your products and increase the price?  
  3. Which industry or market segments provide the most or least CLV? Are you in the best markets, best niches, and aiming for the best clients?

You also want to generate many alternative ways to increase your customer lifetime value.

Now, you can focus on developing many alternative ideas and practices to increase your CLV. You want to focus on your overall business strategy, potential innovations, and marketing strategy. More information is available on our ClickVisor program to help you accomplish these crucial tasks.  

Consider Multiple Marketing Approaches

This process also requires you to expand your marketing approaches based on the industries, segments, and types of customers. It is also a good idea to have more than one marketing approach that you continue to use long term. You need to try and test different approaches as the world, and people change. 

Customer lifetime value will change as you create and implement new programs

As you implement your marketing program, this lifetime value should change as the variables in the process change. So, reviewing your CLV regularly make sense. It will cause you to rethink many things you’re doing as you are always looking for ways to improve that number. 

 Conclusion 

Client Lifetime Value is an essential concept for every business. It goes hand in hand with customer repeat orders and retention. It is also a great concept to broaden your thinking about your company and its mission. Plus, businesses with a high CLV can service their client better and grow continuously over time.

Thanks for your interest. Learn more at our website.

Jim Zitek, ClickVisor Program

jzitek@https://harborcapitalgroupinc.com/wp-content/uploads/2024/07/Braintopview-1.jpg.com 

P.S. We would love to get your thoughts on CLV.  Also, sign up for our free blog  posts at: https://https://harborcapitalgroupinc.com/wp-content/uploads/2024/07/Braintopview-1.jpg.com

PPS. If you know someone who could use this information, please pass it on.

 

 

How To Create Strategies For Business Growth

Posted on by harborcapitalgroupinc

How To Use Business Growth Strategies To Become A Superior Competitor  

 

If you are in a competitive market long-term, you will likely go out of business because eroding margins are the consequence of destructive competition.

Therefore, you need a powerful strategy for business growth to become a superior competitor.  

The good news is there are three strategies we will cover in this blog that you can repeatedly use:

keep creating new ideas and innovations to acquire new clients,

get them to purchase more,

and increase the number of times they buy each year.

Learn how to get out of that long-term competitive race with a superior, long-term strategy for business growth.

Our strategic framework will elevate your products and services over the competition—no more short-term tit-for-tat competitive strategy. 

You will have a process that will deliver endless business growth strategies, opportunities, and revenue growth, making you the market’s value leader.

Without the hype, buy now marketers we see so much of today.

 

This Strategy For Business Growth Blog Will Briefly Cover:  

1. How to make better decisions more often. It covers expertise and critical thinking from one’s perspective and vision.

2. Then, three ways to increase revenues and what you can afford to spend to acquire a new client.

3. And then, we will discuss only three things — business growth strategy, creative insights, and marketing strategy —

you can repeatedly use to keep improving value and increasing revenues and profits. 

Let’s talk about decision-making first because you may want to change how you approach decision-making.

And we know you must make many daily decisions as a business leader. So, let’s start with a question.

 

With So Many Growth Strategy Decisions, How Often Do CEOs Make The Right Decision?

The answer is 52%. You only have to make the right decision 52% of the time to be a top decision-maker — 2% more than the flip of a coin.

Remember New Coke or the Edsel car? Billions were spent and lost by brilliant people making poor decisions.

Why is this number so low? The first reason may surprise you. It’s due to our reliance on expertise.

They specialize in their industry, markets, and products to get to the top of their company and industry.

They have built a kind of wall around their perception of the world.

They know the norms of their industry and are comfortable. So they are comfortable making informed decisions.  

 

Many Executives Have Put Themselves In A “Limited Perception Box.”

Executives often limit their business and industry worldview.

This limits their situational perception, which is a significant reason they can’t get past 52%. 

For example, If you looked at the front of a house, you would have a real, accurate perception of that house.

If someone else looks at that house from the rear, they would have a different and precise perception of it. 

 

Here’s a fun perception example that I like from Edward de Bono.

This group of 12-year-old boys tends to pick on or tease Bobby because the group thinks it’s fun.

They show him two coins one day, a large one (worth $1) and a smaller one. (worth $2).

Bobby picks the large one, and the group laughs and has a good time at Bobby’s expense.

They do this several times over the summer. 

One day, an older man sees what’s happening and afterward tells Bobby that the smaller coin is worth twice as much as the larger one.

Bobby says I know that. But, if I had taken the $2 coin, they would never have kept offering him the opportunity again and again.

Perceptions can be valuable and increase opportunities.

This short story shows how vital your perception is,

and the broader your perception, the better you will be at solving problems, coming up with new ideas, and making good decisions.

You can’t limit your perception of your industry, market, or how you think about your company.

 

Why “Perception” Matters When You Are Trying To Create Business Growth Strategies

 If I asked you what you do, you might answer: I own a hardware store, I am a doctor, or I manufacture light fixtures, or whatever.

You probably would say yes if I asked if you wanted to grow the business. 

So, now let me REFRAME your answer by changing your perception,

Let’s say your first answer was. “I own a hardware store, and I sell products and services.

That perception may then limit your market growth.

But what if you reframed your answer to, “I own a marketing company that sells hardware and services.”

Now, you have a different and much broader perception of what you do and how you would approach your objective or goal differently.  

 

Your job is marketing which means you focus on increasing sales and profits.

You can now focus on ethically building your company, sales, and profits, not as a hustler.

This change in perspective gives you a broader perspective and have you searching for ways to market your business by focusing on your clients.

Note: your focus is now on the client because a client is someone you care about and want to help solve their problems. A customer is a transitory perspective.

 

There Are Only Three Traditional Ways To Get Additional Revenues.

1.  Increase the number of your clients. Start by looking at the “lifetime value” of the client.

If you sell a product for 1,000 dollars, the client makes a purchase once per year,

and the average customer remains a client for five years; the lifetime value of that client is $5,000. 

I assume you would prefer the $5,000 to the $1,000. So, you now know you can spend up to $5,000 (less your costs) to acquire a new client.

If you could increase the number of clients by 10%, you would increase your revenues by 33.5 percent.

2. Increase the average size of the orders

Start by satisfying the client with add-ons or solving the client’s problem better or differently, which might require additional or different items.

Maybe the way they sell cars.

After you agree to purchase the car, they show you the sunroof to make your driving more fun, the better radio that brings in more stations, and more. 

3.  Increase the number of times they buy each year

Create other ways for clients to use your products or services.

A great example is American Express or Visa, which enables you to purchase plane tickets, theater tickets, and a frequent flyer miles incentive program.

Or maybe a special spring and fall sale at your store for current, specially invited clients only.

Those are all excellent traditional things you could do to improve your revenues. But an even better approach will give you continuous revenue growth.

 

How To Achieve A Sustainable Competitive Advantage

Generally, if you are in a competitive market long-term, you will likely go out of business because of eroding margins

due to the problematic competitive nature of competition. 

But, there are only three strategies you can repeatedly do to keep coming up with new ideas to get new clients and get them to purchase more,

plus increase the number of times they buy each year.

Revenue Opportunities Start With Your Strategy For Business Growth. 

Using your new perception, create a new strategy for your business

based on your goal or a problem that needs to be solved to reach your objective or goal.

We could talk for days about what strategy is, but Richard Rumelt, author and professor,

explains a practical and straightforward definition that makes a complex description simple and easy to understand

 

A strategy Process Is: 

1. Identify and define your problem or objective.

2. Diagnose the objective or situation (data is essential but not sufficient) because you rarely come up with new insight

because your mind is dealing with the information you already know

3. Innovate through insight and creative thinking. There are many innovative techniques you can use to create new ways of solving problems, and knowing how to reach the objective,

4. There is never enough time or money to do everything, so you must prioritize and ensure the solution conforms to your strategy

4. Prepare a coherent plan and execute it.

There is never enough time or money to do everything, so you must prioritize and ensure the solution conforms to your business growth strategy.

 

Then Creativity And Innovation:

I need to talk about innovation briefly because many people think they are not creative, but everyone is creative.

Again, Edward de Bono shows why your mind is set up to be creative.

It requires you to learn innovative techniques to put your mind in gear to do the creative work.

And it’s a great way to get business growth strategy ideas.

Humor is a beautiful example of how the brain works.

Humor indicates how our information system gives rise to perception and how you can see the world differently.

You might enjoy this example from a Winston Churchill story. 

A woman MP meets Churchill in the hallway (after lunch and a few drinks) and says to him,

“If I were married to you, I should put poison in your coffee.”

And he replies, “and if I were married to you, I should drink the coffee.” 

Our information system gives rise to perceptions and how you can see the world differently.

Perceptions set up in one way can suddenly be reconfigured in another way. Humor is the essence of creativity. 

One can use many creative thinking techniques to create different concepts, insight imaging, and ideas and turn them into innovations.

For example, the random word technique is an easy and quick way to get many ideas.

See our blog post, “How to turn negative problems into positive results. or Michael Muchalko’s book, “ThinkerToys.”  

 

Then Marketing Strategies For Business Growth

Marketing strategy and tactics are the third groups of tools we can repeatedly use to reach our objectives.

It begins with the same strategy format explained above — objective, diagnosis, insight, and a coherent execution plan — but is applied to marketing strategy.

Apply a market strategy to every tool used. For example, you need a marketing strategy in b2b for your website, blogs or ads, publicity, and other marketing tools.

You might want to see our blog posts on websites and value propositions.

For example, over one million blog posts are created every day.

How would a potential client find and read your blog post?

You need material the client is looking for, not necessarily the material you want to give him;

you need to be different and have a strategy and some creative insights to make it effective.    

Also, because your perspective is now broader, you can use marketing strategies and tactics – from any industry-

to get new clients, get them to purchase more items, and buy more often. 

 

Conclusion

Long-term, it is difficult to compete profitably in a competitive market because of eroding margins.

However, you can win this competitive race with better thinking, a broader perspective, and tools that can be used repeatedly.

To achieve a sustainable competitive advantage, you need to start with your business strategy for growth and keep adapting it to market and buyer changes.

Then use your creativity — everyone is built to be creative. It is a learned skill, not a talent. Learn to create ideas and then turn them into innovations.

Then create your marketing strategy for each objective and program  — like website, blogs, advertisements, publicity, etc. — you will use and make sure you also have a coherent execution plan.

How will you use this approach to strategy for business growth to drive more revenues and profits?

Tell us what you think  Also, if you would like more information like this blog post, sign up for our free blog post program.

PS. You might also be interested in the blog post, Why Your Business Growth Strategy Is Your Story.

How Much Can You Spend To Get A New Client?

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Customer Lifetime Value (CLV) is an important business metric. It is the total revenue your business earns from a customer over time. It gives you a picture of the business’s short-term, and long-term status and financial viability. It is also an indicator of product-market fit, client loyalty, and recurring revenue from existing customers. You can’t continue to improve if you don’t measure.

Know what your customers will spend over time

CLV gives you an understanding of the costs and profits of your business as it relates to acquiring, generating revenues, and retaining customers. Also, getting repeat orders from existing customers brings in a healthy cash flow regularly into the business. When you know what a customer will spend with your business over time, you can consider more options for your acquisition budget. 

Two basic ways to calculate CLV

There are two basic ways of calculating CLV, depending on what data you have available.

1 Accumulated data

If you have historical sales data, this method is far more accurate. It puts together all orders by individual customers to get their own real CLVs. 

2 Average estimate

If you don’t have granular data, you can estimate an average by the following formula: Average order value times number of orders per year.

How to calculate Customer Lifetime Value

For instance, if your customer base will, on average, buy ten times per year at $10 per transaction (or $100 per year) for ten years, the lifetime value of a customer is $1,000 (minus costs). If your profit is 25% of sales, the CLV is $250 (25% of $1,000). Therefore, you could technically afford to spend $250 to attract a single new customer. However, many marketers suggest that you do not spend more than 33% of CLV or, in this example, would be $82.50.

Another view. If you could improve each of the three CLV numbers by 10%, you would increase profits by 33 percent, giving you a profit of about $332 (plus $82). This additional profit could then be added to your marketing budget to grow even faster the following year.

 Now, how can you improve each element of your Customer’s Lifetime Value? 

Now that you know the lifetime value, you want to spend some serious time examining how you can improve your revenues and profits. This information will also give you a long-term look at your business and help you plan for the future. To improve your results, you should do the following things sequentially: 

  1. Increase the dollar amount of each sale to a customer. 
  2. Increase the frequency that customers purchasing from you. , 
  3. Try to increase the number of products or services you provide for your customers.
  4. It gives you a customer feedback loop so you can improve customer service
  5. Build customer loyalty
  6. Analyze and improve customer pricing
  7. Better target your customer through segmentation
  8. It helps you plan both short-term and long-term strategy
  9. Then, you can begin to increase your market share by going outside — to increase your market share by working on your competitor’s customers.

This process also forces you to look at different market and customer segments. For example:

  1. Who are your best customers and worst customers using CLV? How can you get more of the good customers and maybe fewer of the lower-value customers? 
  2. Which products provide the most revenue and profits? Can you add value to your products and increase the price?  
  3. Which industry or market segments provide the most or least CLV? Are you in the best markets, best niches and aiming for the best clients?

You also want to generate many alternative ways to increase your Customer Lifetime Value. 

Now, you can focus on developing many alternative ideas and practices to increase your CLV. You want to focus on your overall business strategy, potential innovations, and marketing strategy. More information is available on our ClickVisor program to help you accomplish these crucial tasks.  

Consider Multiple Marketing Approaches

This process also requires you to expand your marketing approaches based on the industries, segments, and types of customers. It is also a good idea to have more than one marketing approach that you continue to use long term. You need to try and test different approaches as the world and people change. 

 Customer Lifetime Value will change as you create and implement new programs.

As you implement your marketing program, this lifetime value should change as the variables in the process change. So, reviewing your CLV regularly make sense. It will cause you to rethink many things you’re doing as you always look for ways to improve that number. 

Conclusion 

Client Lifetime Value is an essential concept for every business. It goes hand in hand with customer repeat orders and retention. It is also a great concept to broaden your thinking about your company and its mission. Plus, businesses with a high CLV can service their client better and grow continuously over time.

 

 How To Repeatedly Make Sound Decisions  

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 Make Sound Decisions Repeatedly

A survey of top executives showed that executives only make “sound decisions” 52% of the time.

That’s only 2% better than flipping a coin. So if you could improve just a few percent, you could be

in an elite class of decision-makers who make sound decisions repeatedly.

Why is it only 2% better than flipping a coin? There are three reasons:

1. Their extensive industry knowledge and expertise.

2. Their reliance on analysis and critical thinking

3. Their self-limiting perspective.

 

Industry expertise can hurt your ability to make sound decisions.

 

In becoming a decision-maker, you have accumulated extensive knowledge and experience in your industry, market, products, and services.

You have talked to many customers. You know how what works and what doesn’t work.

You have established patterns, processes, and a culture of how “we do it here.”

While all of this is necessary, it has also established automatic thought patterns, which you can refer to quickly.

And at the same time, it limits your ability to think outside of your industry and market

to understand how other markets and industries might think about and handle the problem or opportunity.

So they decide based on the past rather than exploring new ways to think about the problem or opportunity.

Hearing about how a different market does something often gives them ideas on

how they might use this idea or process to solve a problem or improve their strategy, product, or service.  

All this built-in knowledge and experience keeps them from repeatedly making sound decisions.

 

Over-reliance on analysis prevents making sound decisions. 

 

 We learned that gathering enough information and analyzing the data thoroughly

was the “the way” to solve problems and create a better way forward.

Unfortunately, making data-driven decisions often does not work because analyzing the data is all about the past, not the future.

So, if you need to move forward into the future, all those old solutions and ideas will not work.

Here’s an article from Forbes if you want another view.  

Critical thinking is a good process and should be used,

but the object of critical thinking is to judge whether the information you have is correct or not, true or not.

That is undoubtedly important to understand the problem or opportunity,

but it will not help you look into the future to solve this new problem or exploit this unique opportunity.

The goal, of course, is to make sound decisions repeatedly.

Here is a traditional view of critical thinking from the Critical Thinking Organization.

 

Limited perception inhibits making sound decisions. 

 

 The first and maybe the most important thing you need is to see the problem or opportunity.

In other words, your perception. It is your perception that will design a solution.

One of the best ways to explain this is with an example. Here is one from Edward de Bono.

A group of 12-year-old boys was always picking on Bobby, one of the boys.

Because that is what they do at that age, one day, they showed Bobby two coins,

a larger one worth one dollar and a smaller one worth two dollars, and they told Bobby

he could pick one of the coins and keep it.

Bobby picked the larger coin, and the other boys laughed and talked about how dumb Bobby was. 

They made this offer whenever they wanted a good laugh at Bobby’s expense.

One day an older man saw what they were doing and told Bobby that the smaller coin was worth twice as much as, the larger coin.

Bobby said he knew that. But if he took the two-dollar coin, they wouldn’t keep returning and giving him additional coins.

 

Conclusion

 

Expertise and analysis are essential, but you must look forward rather than just backward

and broaden your perception if you want to move forward.

So, your perception of the situation is often not considered and is critical to your decision.

That is how you will make sound decisions repeatedly. 

 

You will want to check out our blog post, “How To Get Significantly Better Results In Less Time.”

Also, check out our website, How To Create Strategies That Turn Goals Into Results.

How To Make Better Decisions, More Often

Posted on by harborcapitalgroupinc

Make Better Decisions, More Often

In a survey of top executives, the results showed that executives made “sound decisions” only 52% of the time.

That’s only 2% better than flipping a coin. So if you could improve just a few percent, you could be in an elite class of decision-makers.

Why only 2% better than flipping a coin? There are three reasons:

1. Their extensive industry knowledge and expertise.

2. Their reliance on analysis and critical thinking

3. Their limited perspective.

Industry knowledge and expertise

By the time you become the decision-maker, you have accumulated extensive knowledge and experience in your industry, market, products, and services.

You have talked to many customers.

You know how what works and what doesn’t work.

You have established patterns and processes and probably have established a culture of how we do it here.

Don’t limit yourself  to your expertise and your built-in biases

While all of this is necessary, it has also established automatic patterns of thought, which you can refer to quickly.

And at the same time, it limits your ability to think outside of your industry and market to understand how other markets and industries think about the problem or opportunity.

So they decide based on past thinking rather than exploring new ways to think about the problem or opportunity.

Hearing about how different markets do something can often give you additional ideas on how

you might also use this idea or process to solve a problem or improve their strategy, product, or service.  

Overreliance on analysis and critical thinking

Most people were taught that if you gather enough information and analyze the data thoroughly,

you will develop “the way” to solve the problem or create a better way forward.

Ufortuanlly, this does not often work because the data you are analyzing is all about the past, not the future.

So, if you need to move forward into the future, all those old solutions and ideas will not work.   

The Critical Thinking Process

Critical thinking is a good process and should be used, but the object of critical thinking is to judge whether the information you have is correct or not.

It is undoubtedly important to understand the problem or opportunity,

but it will not help you look into the future to solve this new problem or exploit this unique opportunity.

Another view

Here’s an article from Forbes if you want another view.  

Here is the caution when dealing with averages and human behavior data.

As you know, there are many variations in personal values within that average.

So, if you are thinking about behavior, be sure to take into account all the possibilities that data includes.

Market segmentation and psychographies will help get your thinking started.

Here is a traditional view of critical thinking from the Critical Thinking Organization.

Limited perception

The first and maybe most important thing you need is to see the problem or opportunity. In other words, your perception.

It is your perception that will help you design a solution. One of the best ways to explain this is with an example.

Here’s an example from Edward de Bono.

A group of 12-year-old boys was always picking on Bobby, one of the boys. Because that is what they do at that age.

One day, they showed Bobby two coins, a larger one worth one dollar and a smaller one worth two dollars, and they told Bobby he could pick one of the coins and keep it.

Bobby picked the larger coin, and of course, the other boys laughed and talked about how dumb Bobby was.

They made this offer every time they wanted a good laugh at Bobby’s expense. 

One day an older man saw what they were doing and told Bobby that the smaller coin was worth twice as much as, the larger coin.

Bobby said he knew that. But if he took the two-dollar coin, they wouldn’t keep coming back and giving him additional coins.

There is a distinction between a perception and a concept.

Perception is a grouping of things realized when we look out at the world—for example, a mountain.

A concept is a grouping of things discovered when we look inwardly at our experience.

A concept has a purpose or benefit—for example, a takeout restaurant.

Also, a concept always consists of both the concept and its implementation.

Conclusion

I want everyone to make better decisions more often, me included.

Expertise and analysis are essential, but you have to look forward rather than just backward.

You may also have to broaden your perception if you want to move forward.

So, your perception of the situation, which is often not considered, is critical to what kinds of decisions you will make. 

PS.  If this information helped you with your decision-making, let me know how it helped (or did not help) so we can help others.

 

How Your Value Proposition Defines Your Website’s Success

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How Your Value Proposition Defines Your Website’s Success

Visitors come to your website because they have a specific problem that needs to be solved.

But, visitors will only give you about 8 seconds before deciding if they will stay and read more.

If they stay, you have about 125 words to convince them that your company has the best solution to their problem.

They will probably not read on or even scan the page if they are not confident. They will move on and probably never come back again.

Tell your value proposition story quickly.

Years ago, we were taught to start with the problem and then offer the solution.

But think about it. Your visitors already know the problem, so they are at your website.

They are searching for the answer to their problem. 

You need to convince them immediately that your value proposition solves their problem.

Tell them why you can solve their problem.

Tell prospects what you do and how you solve their problem

Why your solution is superior to your competition.

Your value proposition needs to compel them to read your entire story.

They will most likely move on without a clear, targeted value proposition.

Most people look at multiple companies before deciding to move forward.  

To show you how few companies have a compelling value proposition,

marketingexperiments.com states that only 2.2% of businesses have a compelling value proposition. 

You must also tell your value proposition story quickly at the top of your website.

Very few websites have a value proposition, and even fewer have it at the top of their website.

Check out your competitor’s websites and see how many have a value proposition and what you see as your competition.

Remember, your website is about what they want to hear, not what you want to tell them.

Here are the basics you will want to include:

  1. Headline. The headline tells the reader your value proposition in one sentence, no more than two sentences.
  2. Yes, it’s only one sentence, but you will have to write it many times to get it perfect and make it attention-getting.
  3. Next, write a short explanation of the critical elements of your value proposition in two or three sentences. Remember, you have to be able to deliver what you promise.
  4. Then, add up to three features, benefits, or unique differences you offer. Individual bullet points are an excellent way to highlight these benefits.
  5. A positive image, if possible. You know, of course, it’s worth a thousand words :).

Here are the basics you will want to include:

  1. Headline. The headline tells the reader your value proposition in one sentence, no more than two sentences.
  2. Yes, it’s only one sentence, but you must write it many times to get it perfect and make it attention-getting.
  3. Next, write a short explanation of the critical elements of your value proposition in two or three sentences. Remember, you have to be able to deliver what you promise.
  4. Then, add up to three features, benefits, or unique differences you offer. Individual bullet points are an excellent way to highlight these benefits.
  5. A positive image, if possible. You know, of course, it’s worth a thousand words :).

I am sure you will consider many more questions to examine as you define your value proposition. To NeilPatel.com, Google cares about how long people spend reading your webpage. If visitors spend time on your page, you got it right.

Conclusion

Your value proposition is critical. You will be in a class all your own if you have a compelling value proposition.

You will want to get it “perfect,” which will take some time.

It may only take a few minutes to write, but it will take many tries to perfect it.

To get started, ask yourself these questions.

  1. Why does the potential client want to solve this problem? I
  2. Is there no workaround?
  3. How is the problem affecting their business?
  4. Why haven’t they been able to solve it already? How can you solve the problem?
  5. What outcome and benefits result from your solution? Here are the basics you will want to include:

 

P.S. I would love to hear how the development of your value proposition went and how successful you have been since you implemented it. Go to our website and let us know. Your story may inspire and help others (and us) try to improve their value proposition.

PPS. You might want to check out this blog post as well. Transform Your Competitive Market Into an Uncontested Market. Click Here

Innovative Strategies: Leverage Potential Change

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Difficulty of making decisions about the future.

Exploit Market Changes

Industries and markets are constantly changing for many reasons, including technology, a new business model, or a pandemic.

When this occurs, companies have two choices: adapt to current changes or, longer-term, be disrupted.

But, if you pay attention to these changes, you can develop innovative strategies for revenue growth and exploit these market changes. 

That is what we are going to talk about in this blog, how companies react to these changes, how you can adapt your strategy to these changes

to gain product value, revenues, and even a long-term monopoly in your market.  

Companies that do not adapt generally resort to inertia or entropy.

What is inertia?

Inertia is the unwillingness of the affected company to adapt.

Not adapting could be caused by routines (the way we have always done things) or an unwillingness to change strategies because it will hurt current profit streams.

They assume that these current profit streams will continue. 

However, this also opens up opportunities for others. For example, Netflix replaced Blockbuster. Walmart replaced K-Mart.

What is entropy?

Inertia generally leads to entropy. Entropy is not keeping your product line up to date and, therefore, losing clients, sales, and market share.

The primary reason entropy becomes the problem is that the company becomes less focused on its products,

often reduces prices and generally becomes less responsive to its customers. You might agree with Elon Musk, “I think you should always bear in mind that entropy is not on your side.

Again, entropy opens opportunities for competitors to innovative strategies for revenue growth.  Product-market fit is not a permanent status.

For example, the Encyclopedia Britannica was replaced by Wikipedia. Photographic film was replaced by digital cameras. 

Innovative Strategies: Examples of Potential Opportunities

Your strategic opportunity is to pay attention to these changes and be willing to innovate your products or services and experiment.

In that case, you can leverage your current strategy.

You can capitalize on these changes with new concepts, ideas, products, or services that should generate new revenues and profits for years to come. 

A few examples of potential innovative strategies for revenue growth in market changes are happening today.

 

Innovative strategies for potential changes in auto Insurance

Every car insurance company says -one way or another- you only pay for what you need.

And there are companies with apps comparing prices. How long can profitability last?

I also realize that much of their money is made on premiums and reinvesting premiums into other interest-paying assets.

But what happens when interest rates change, and the spread collapses?

 

What happens when car buyers switch from buying cars to subscribing to vehicles?

This concept is just getting started, but the idea is increasing globally.

Just pay a monthly fee and drive off the lot. You have a three-year subscription and can change car models every 12 months.

You subscribe at the dealership, and your monthly subscription includes insurance (they want to protect their asset.)

 

This concept is new, and I assume changes will be made along the way.

Other opportunities include electric cars, charging stations, gasoline prices, parts costs, and many more. 

Is there an opportunity for an innovative strategy for growth, or are insurance companies the next Blockbuster video rental company? 

How could you take advantage of these opportunities if you are in this industry? 

 

Innovative strategies for opportunities in the phone market

One telephone service company sells its service for $75 per month,

and another sells the same service with the same coverage for $25 per month.

Are costs plummeting, or are more and more competitors entering the market? 

Or are the phone companies still making money on phone sales?

But we see ads claiming you can save about 50 percent on some phones.

Are these companies simply discounting to get updates or new customers

— or calling it the marketing cost of acquiring a new customer who will eventually be profitable over the long term.

Plus, what technological advancements are going to happen? Will SMS messages all become MMS multimedia messages?

Will there be anyone left on laptops?  What will happen with 5 G?

How will this evolving industry affect your market, product, or service? And how quickly?

 

Innovative strategies for opportunities in the real estate market.

Real estate companies continue to reduce their commissions and have gone from 6% commission down to about half that amount.

Companies and agents use marketing companies to get listings and independent agents to sell homes.

This new sales model has dramatically reduced costs. 

There have also been new sales models like “ibuyers,” who buy a home in cash with no fees,

spend a few dollars updating the home, and resell the house for a profit. Can this last with higher interest rates and slowing house prices?

 

Also, many real estate companies own title companies because that is another way to “cross-sell” and increase their sales and profits.

But what if title companies begin using blockchain technology to make title registration faster, easier, and safer –maybe reducing title insurance? 

Or what if the real estate agent took the average discount the buyer wanted and gave the buyer a portion of that discount as a “bonus” at closing for buying the house?

That money would be much more valuable to the buyer than the small amount that would reduce the monthly payment.

Considering all the variables that go into the real estate market, how will this market change in the next 3-5 years?

How will the real estate companies deal with all the brick-and-mortar offices across the country? 

More changes and opportunities to come

Those few common examples are only the beginning of the changes we will see in the coming years.

For example, what will RoKo streaming television do to cable companies?

Or is Artificial Intelligence taking over more and more tasks?

Or are 3D printers building homes in a couple of days? 

 

The list could be extensive, but you get the idea: everyone is or will be affected by continuous changes in our world.

One way you can deal with these changes is to monitor the changes knowing that some companies

will adapt quickly while others will respond with inertia and/or entropy.

Those companies are easier to identify and give you time

to create and modify your strategy to be the value leader in your industry and market

-and maybe own the monopoly position in a new market niche.

 Conclusion

Gain Strategic Leverage From Market Changes

-Market fit continues to evolve and change with the economy and the customer’s needs and wants.

Therefore, stay alert and be ready to take advantage

of the many new opportunities to modify your strategy as required.

Who can argue with Elon Musk’s perception of the future?

He says, “you have to get into a new market several years ahead of the apparent trend to be a player in that market.” 

 

Cheers,

Jim Zitek

 

PS. If you would like to learn more about business growth strategies,

check out this blog post: Why your business growth story is your story

PPS If you want to get the right information at the right time, check out our website,