• Innovative Strategies That Create More Profits

Category: Blog Post

Why Customer Lifetime Value Is So Critically Important

Posted on by harborcapitalgroupinc

Why Customer Lifetime Value Is So Critically Important

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, long-term status, and financial viability. It is also an indicator of product-market fit, client loyalty, and recurring revenue from existing customers.

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. 

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 CLV? 

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 CLV

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. 

 CLV 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.

 

How To Get Significantly Better Results In Less Time  

Posted on by harborcapitalgroupinc

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Get Better Results In Less Time

No one has enough time, especially business executives. 

We always try to do more, learn more, and produce more. 

But there are only 1,440 minutes in a day, and no one gets more time, no matter who they are. 

But there are ways to get much more done and better if you know how to use your time correctly.

Start by asking yourself these questions.  

What do I love doing? 

What is my expertise? 

What do I hate doing? 

What do I do that isn’t a priority? 

Here is the first step if your goal is increased productivity and faster results. 

Get rid of the jobs you hate to do and those that are not a priority. 

If you hate doing them, you are probably not very good at them either. 

Plus, they take more time than they should. Time is not a renewable resource. 

Maybe someone in the company loves that kind of work and would be happy to do it. 

If not, hire someone from the outside to do it. That’s probably less expensive than you doing it. 

You have just saved time and used it on higher priority projects like driving revenues and profits. 

Wait, there is another way to use your time more effectively. 

What if you closed your office door, turned your phone and email off, and told people not to disturb you for three or four hours. 

The result would be no interruptions, no time-sucking chit-chat, no distractions from emails that were not critical, and more.

Imagine four hours free of disruption –every day –what you could accomplish with that much extra time. 

I’ll bet significantly more than twice as much.

Conclusion

Now, you can focus on the priority jobs where you have the expertise. 

That’s how you become an exceptional leader that gets results.  

Jim Zitek

Harbor Capital Group

P.S. Check out our website for more information on how to get results

P. P.S.It’s a short week so I made this short to save you time 🙂

 

 

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How Much Will People Pay For Your New Product?

Posted on by harborcapitalgroupinc

How Much Will People Pay For Your New Product?

 

Most people believe their new product or service idea is a huge winner. But, to be sure, they tell some friends about the idea and ask what they think. Their friends, of course, have no idea but don’t want to hurt their feelings or be unnecessarily pessimistic. So they generally give a positive response to the idea.   

That is the wrong approach.

 Based on Rob Fitzpatrick’s experience as an entrepreneur, and several failing startups, he realized there was a better way 

and wrote a book titled, “The Mom Test.” that solved his problem.

Here is what he found out. To validate your problem, you have to interview people in your targeted market,

but you can not tell them what your product is.

That will bias their answer. Again, mainly in your favor.

People want to be friendly, and there are no consequences for their response as there is no product yet.  

You want to interview people about a subject other than your new product.

Then, during the interview, find a way to casually ask the person if they have the problem you think they do.

if they say yes, ask them how they dealt with the problem.   

Let them tell you exactly what the problem is

Let them tell you how serious the problem is and how they dealt with it.

The interviewee is now talking about his/her experience and giving you facts rather than opinions.

You need facts to make a go/no-go decision.

 Also, If the problem is serious, ask what it cost them (time, money, operational issues, etc.) to solve.

That will give you an idea of the price range you could charge.

Start with your  market representative list  

Get started by creating a list of about 30 people you can interview — that number would be statistically significant.

This is the kind of information you and your team will need to diagnose and create the solution.

Want even better product design ideas? 

You can now take this information as the basis for your diagnosis of the problem

and use your creative problem-solving skills to design an awesome product. 

See our blog post: How you can turn problems into opportunities.     

 The Next Step In Your Product Validation          

After you get your initial product or service designed, revisit people in the targeted market,

This time with your solution to see if they are willing to pay for your problem-solution fit.  

Conclusion

Don’t ask how much they would be willing to pay for your solution.

Ask them how they are solving the problem now and what they are paying to solve the problem including time delays, workarounds, performance, etc.

That will give you an idea of what you could look at in terms of the price range.

Jim Zitek l Harbor Capital Group

P.S. You can get more information about validating your new product idea by going to our website

and downloading our free report “ Learn The 4 Secrets That Guarantee Problem-Solution Fit.”

 P.P.S. If you know someone who could also use this information, please pass this on to them.

  

How You Approach Problem-Solving Matters

Posted on by harborcapitalgroupinc

How You Approach Problem-Solving Matters

No matter who you are, a seasoned businessman or an entrepreneur, you continuously face different problems on that pathway to success.

And you can add to that the challenge of not having enough time to do everything.

We want to change that by getting you off on the right foot with how you initially approach problem-solving.

It’s important because the way you approach problem-solving matters.   

 

Most problems need a timely solution. Some linger because we don’t know how to solve them.

It often happens when you suddenly have to face some things that you did not expect.

So, choosing the best path to reach an effective solution matters.  

Following are several approaches to problem-solving.

Understand them, and you will be able to see the changes in how fast and effective your problem-solving techniques will become.

 A Team Approach To Problem-Solving

If you are working with a team, everyone on the team must know and understand the problem from their own perspective.

And every person on the team must be able to freely express their point of view without criticism.

Leadership means that you remove all the fear in people’s minds of any repercussions if their idea is ridiculed.

The good news is it often happens that some off-the-wall comment is picked up by someone else and turned into a potential solution.   

 

If you find that you cannot find “the” solution after a reasonable amount of time, compile a list of all the suggested solutions.

You can then analyze which one has the potential to solve your problem.

A day or two later, when people are not intensely focused on the problem’s details, someone often comes up with an insightful solution.  

 

Having an open-minded approach is needed to develop transparent communication.

With an open mind, you can see things more clearly and see the bigger picture.

Finding and assigning important tasks to all the open-minded people will help in reducing the problem-solving time.

People with open minds can take you forward in your quest to find the best solution to any of your problems.

Creating a team of people who know exactly where to look when a problem occurs is always an interesting approach to problem-solving.

 

Mindsets Make A Difference In Approach And Outcomes

Next, let’s take a look at different mindsets and how these mindsets approach problem-solving.  

Analytical thinking:

People who think analytically generally consider every aspect of the problem.

From here, they can move forward in a calculated way.

People with analytical thinking mindsets find it very easy to take on and solve any problem, so they proceed step by step.

They make assumptions and considerations because they have expertise in discovering new things, and they are sure about it.

Logical thinking:

People who think logically and straightforwardly learn from their actions from past actions.

Logical thinking can get you the solution you seek for any of your problems.

Logical thinking is the basis of their solution.

They approach the problem from how they think a normal person would view the problem.

They try to see the long-term solution.  

Rational thinking:

It is a kind of thinker who would use their knowledge and assumptions.

They would not look for any experience or any other factor.

From their perspective, they may be like the problem,

and he would solve them in a way that others may find questionable.

Absolute thinking:

The absolute thinker wants surety for everything.

He has just two solutions, and one is right while the other is wrong.

He only selects from two of them, and for that, he always seeks permission from higher authorities.

He does not live with probabilities.

Creative thinkers:

Creative thinkers do not remain limited to one or two solutions based on their judgments or past experiences.

They can create solutions from scratch.

And they do not focus on one thing when there are so many potential solutions.

They will also take tier time in coming up with these solutions.  

Conclusion:

Your approach to problems tells how you will solve your problem.

Identifying and agreeing on the problem rather than working on a symptom is critical to your success.

Learning how to solve problems creatively is a crucial talent and a toolbox for anyone who wants to succeed in business.  

 Solutions, no matter how difficult the problem or challenge, can be solved — some instantly and some, like solving the theory of relativity, took Einstein 10 years.

Always choose your method or technique according to the complexity of the problem.

Lastly, remember that trying to approach and solve a problem as a team can be fragile because you have to give space and freedom without criticism to each member.  

We hope this information gives you some food for thought as you approach a specific problem.

I would love to hear your comments on using this approach. 

 

 

How To Turn Problems Into Opportunities

Posted on by harborcapitalgroupinc

How To Turn Problems Into Opportunities

Being a founder or CEO of a growing company means you are always stressed to do more.

There is too much to do, too many problems to solve, and too little time to do it all.

Yet, on top of all that stress, you have issues that crop up almost daily.

So, how can you turn problems into opportunities and move forward?

 

Anyone can turn problems into opportunities using problem-solving techniques, and you don’t have to be a genius to do it.

However, you have to learn a little about the different kinds of problem-solving strategies and techniques. 

 20+ Problem-Solving Techniques

We are working on creating a series of over 20 ways anyone can turn problems into opportunities.

We explain how each one works. You can’t simply read one after another and understand that technique well enough.

You need to know if that technique works for you or if a different one would be better.

We encourage you to try each one. Some methods you can do quickly, and others take more time.

But, each one will teach you how to become a better problem-solver.

 Your Mind Is Pre-Wired To Solve Problems

According to Danial Kahneman’s book: “Thinking Fast And Slow,” Your mind is pre-wired to go problem-solving.

It can switch your thoughts from thinking fast (having an instant answer or a Eureka! Moment)

to thinking slow (digging deep into your knowledge base for breakthrough ideas).

For example, Einstein’s theory of relativity. Your mind switches back and forth between the two thought processes as it searches for the answer.

This process lets you see a bigger picture and more problem-solving options.

 In addition to fast and slow thinking, you need to have a positive attitude to solve problems.

You can’t focus on the negative (“why are sales slowing down”).

You have to reframe the negative problem into a positive (“how do we get customers to buy more”). That way, you are focusing on a positive solution. 

 Pretty easy so far, right?

Next, you can begin to look at the many problem-solving techniques that will help you solve your problems.

A good place to start is with Michael Michalko’s books, especially the “Thinkertoys” book with many problem-solving techniques. 

He divides the techniques into two groups.

One group focuses on a linear method using words and illustrations to probe your thoughts.

Some people are more comfortable working with word concepts.

The second group of techniques is more intuitive and relies on intuition and insight to arrive at the solution.

People generally prefer one group over the other just based on their individual preferences.

There is no right or wrong technique. 

You can use any of the techniques to solve your problem. You do want to become familiar with all of them.

Each has a unique way to structure and process information that leads to a solution.

Some techniques will seem easy, and you will like using them. Others may give you answers, but the process isn’t as comfortable as some others. 

Also, some techniques will give you the confidence you need to believe that you will solve the problem.

Never underestimate the power of confidence. You have to believe you can solve the problem.

So you pick the technique that works best for you or try several of them on your problem to see what results you get.

All Problem Solving Techniques Will Be Covered

We will be covering all of these problem-solving techniques on our advisor platform.

But, you can’t simply read about a method and quickly move on to the next one.

You need to go through a problem-solving example so you can get the idea and feel of how that technique works.

Working through an example is the only way you can judge how they work and if you are comfortable with that specific problem-solving technique.

Three Factors That Will Help You Turn Problems Into Opportunities

Brian Tracy, in his book “Creativity and Problem Solving,” offers three factors, among many good ideas. That helps you be creative:

1. How intensely you desire a goal (the more you want to achieve that goal the more ways you will find to achieve that goal).

2. How serious the problem is to your life or business. Once you have identified what is holding you back from an important goal,

your mind will start generating ideas to solve that problem. 

3. How do you focus on the question. (the more precise and focused you are on the question, the more rapidly your creative reflexes operate to generate workable answers

 Using these problem-solving techniques, you will be able to

1. Generate ideas at will

2. Create new business opportunities

3. Modify ideas until you come up with innovative and powerful ideas

4. Improve old products, services, and processes

5. Develop solutions to complex business problems

6. See problems as opportunities,And much, much more

Conclusion

As an entrepreneur or CEO, our hectic lives are continually being interrupted by challenges and problems that need creative solutions, short-term, and long-term solutions.

And everyone is capable of innovative solutions.

It’s a matter of learning the methods and techniques of creative problem-solving and practicing them.

Remember, the worth of the idea you create will depend to some degree on the way you define your problems.

For example, write down the problem. Translate it into a positive opportunity. It is impossible to be creative if you are focused on a negative.

You have to look at the problem broadly. This broad approach is true for problem-solving techniques as well.

Try all of them and select the ones that work best for you.

We would love to hear your comments about problem-solving, good or bad.

How To Find Out If Your New Idea Will Sell And For How Much

Posted on by harborcapitalgroupinc

How To Find Out If Your New Idea Will Sell And For How Much

Most entrepreneurs are confident their new product or service idea will be a big winner. But you would like to find out if your new idea will sell and for how much before you invest lots of time and money.  So, to be safe, you tell your Mom or wife about the idea and ask what she thinks. Guess what? She says it could be a great idea. She may not be sure, but she doesn’t want to hurt your feelings or dampen your enthusiasm.  

Still not sure, you decide to ask more people and get additional “facts.” Again you tell them your idea and ask if they think it’s a good idea? Do they think people will buy this product or service? Not surprisingly, almost everyone agrees with your Mom. Great. Now you have the facts to validate your hypothesis. 

Not All “Facts” Are True

But, there is a big problem, you don’t have real facts. The “facts” you have are only “opinions” from people who don’t want to hurt your feelings or dampen your enthusiasm. Just like your Mom, people want to be nice. Besides, they are not committed to buying it, so there is no downside for them.  

If you start your business using these false facts, your chances of succeeding are slim. But, there is an answer. Rob Fitzpatrick, author, and entrepreneur, started several companies that failed using this traditional customer research. He finally realized what the problem was, and here is what he found. 

Talking to potential prospects is critical, but you have to speak to them in a way that they will give you real facts, not just opinions. So the first step to getting real facts is not to tell them what your product idea is.   

Don’t Talk, Listen

Set up a casual meeting or coffee, so they are comfortable. And remember, you are there to listen, not talk.

Ask them about themselves and their job. People love to talk about themselves.

During that conversation, find a way to bring up a question related to the problem you want to solve.

For example, here are some opening questions, “that part of your job sounds difficult.

Is that a big problem?” or “I’ve been told that X is a problem. Do you have that problem?”

Then based on their answer, keep probing about the problem and how they dealt with it.  

 

This explanation is experience talking about their problem and how they handled it — this is how you get factual information rather than just opinions.

They verify if the problem exists, how painful it is, and how they dealt with the problem.

Maybe it’s a minor problem, and they have a way to deal with it now. Perhaps it’s a significant problem that is costing the company time and money.

This approach will verify if there’s a problem and if the pain is severe.

You get facts, not opinions, which will give you actionable insights.

Here are some of the problems with the traditional approach:

1. We spend too much time collecting data that’s too unreliable for important decisions.

2. Sometimes we don’t realize the data we are collecting is worthless (even misleading)

3. Asking customers what they think of your idea almost always leads to bad data.

4. We assume customer feedback is scientific, and whatever they tell us is scientific and counts as learning. 

5. But, it’s easy to bias the people we are talking to. Once you tell them you have an idea, they are already biased beyond repair because they don’t want to crush your dreams,   

6. If people tell you your idea is terrible, that may not be useful data either. Why? People are bad at predicting both: which ideas are good and what they,

as customers are going to do, buy, use in the future,

7. Even Venture Capital firms credited with being the best predictors are wrong more often than right.

And If their judgment is worse than a coin toss, how seriously can you take anyone’s opinion? 

8. If you are going to get your “facts” faster (e.g., focus groups, surveys, etc.), it could be a big mistake.

The problem is this information is not robust enough to bet your company on it.  

Get them to talk about costs

During your questioning, you will ask how they solved the problem and how expensive it is to solve the problem.

Now, you have an idea of the cost parameters to determine if the product will be profitable. 

This approach does take some time as you will want to interview people until you begin to get repeated information.

However, it is less expensive than starting development and having to end the project later.   

 

Get facts, not opinions

You can get broad industry views and some facts and figures from Google information,

but the insights you need only come from face-to-face conversations with prospects.

It’s the insights into your customers’ worldview and decision-making that tell you to build it or not.

You need real insight into what customers want.

 

There is also a problem if you put together a small group of people to do these interviews.

You will end up with several opinions as to what they heard and what is essential.

These variations in view make defining the most critical problems difficult.

You do need to keep everyone informed of the information. 

Conclusion

You can get the real facts you need if you don’t bias the potential customer by telling them your idea.

Ask questions about a problem they might have and what they did to solve the problem.

Get them to say to you, based on their experience, the problem, and how they solve it or don’t solve it.

Also, what they currently pay to get it solved now.

At this point, you are only trying to verify that the problem you want to solve is a real problem, and the customer would be willing to pay to get it solved. 

 

Once you have your product concept designed, the second step is to follow up with customer interviews

with your product or service design to determine your solution’s validity.

You will also ask for some commitment, not necessarily money, maybe a referral to another user in the company

to determine if the person’s positive response is factual or just being friendly. 

 

We would love to hear your thoughts on this blog or this topic. Or a topic you would like us to discuss. You can reach us HERE.

Jim Zitek

P.S. If you know someone else that would like this information, pass it on. 

How Your “About” Page Increases Revenues

Posted on by harborcapitalgroupinc

How Your “About” Page Increases Revenues

 

Your “About” page is the second most important page on your website because it helps you increase revenues.

Once visitors see what you do on your home page, they jump to your about page to see what you are all about.

It also sets the tone and authority level for the rest of your website.

 This critical page is necessary for content conversion and then increases revenues because it is the beginning of building trust with your prospects. 

Because your About Page is important, it has to reflect your personality and the way you see things.

The following basic elements are a guide for the content you need to include.

Many of the suggestions are from an article in Inc magazine written by Jeff Haden. Another good reference is Hubspot. 

Your about page could be about “Us” (your team or company) or about “Me” a single person, or about “your brand.”

Stay consistent; first person (I, or we), second person (you), or third person (he/she/they) throughout your story.

 

Also, if you want to connect with people, be transparent and honest.

If not, they will sense it as they go through your story and dismiss you if they feel you are not being truthful.

Most people find it hard to write about themselves, so ask people you know how they would describe you and what you offer.

Start your story by stating your goal right away, Let them know where you stand and why what you offer is important to them. 

Start with your keyword in the headline

Your headline should include your keyword.

You can have a subhead that states the problem, solution, result, and benefit.

For example, you could use “About” or Your Name and then have a subhead that contains your core story.

The important thing is that you have to make your point early.

By the time they get to the bottom half of the page, many people drop off.

Also, your about page can also help you with your Google ranking and organic traffic,

so having it SEO optimized is also important.  Neil Patel has lots of examples of how to use your About page.

Move to what the customers need

Generally, people go to your About page because there is some interest or problem they want to solve.

For example, reach product-market fit, find new customers, or increase revenues.

So, address that problem and show them how you can help solve their problem better than anyone else.

Your About page may say it’s about you and it is.

But, what the readers want to know is if you can solve their problem and deliver the results they want.

Start with your core story (strategy) and tell them what you do and what they can expect, Be specific, but brief.

Tell them what kind of customers you have

Tell them who your customers are, so they can determine if they fit the way you do business or not.

You can also mention who your customers are. For some, those names or companies will be important in their decision.

Also, give them facts not fluff.

Don’t tell them how outstanding you are, give them facts, and let them judge for themselves.

If you don’t have facts, don’t make them up.

Talk about your vision and why you do what you do and what you hope to accomplish.

If they agree, they may want to come along. Like Simon Sinek says, people don’t buy what you do, they buy why you do it.

To Get Conversions and increases in revenues, you need a CTA

You also need a Call to Action (CTA) on your page.

For example, what do you want them to do once they have read your page?

Do you want them to sign up for your blog, get your lead magnet, or watch a video? 

Don’t try to be something you are not

The page has to be condensed around your story. However, don’t write a long, boring, detailed history of your life. 

Often, smaller companies pretend to be bigger than they are.

If you are passionate about what you do, they will see it and feel it.

Focus instead on how you can help them.

For example, because you are smaller, you can give them more attention, get things done faster, and possibly save them money.

 Tell them where you started your journey and some important milestones you achieved along the way.

Provide some background about you and what led you to this business. You can tell them about the challenges you faced and why you do what you do today. 

Use real photos. 

Real people in real places.

Don’t use stock photos as everyone can spot stock photos, and they take away from your authenticity.

You can also use infographics. They can tell a powerful story in a short amount of space. And color helps.

Keep testimonials short and to the point

Have testimonials that make a specific point.

Distill them down to just a few sentences.  Also, make sure they speak to your story.

Also, testimonials can be used to answer anticipated objections in a positive and believable way.

Certifications and awards are important 

If you are in a profession where certifications are required and important, use them.

Important awards are also important. But you can easily overdo them.

If you have a lot of awards and think they are important, have a special awards page.

Remember, this section is about giving you credibility, not glorifying you. 

Your About page must load quickly

Studies have shown that for every second it takes to load your page, There is a 7 percent decrease in conversion rates.

 Always stay in beta

Don’t write this page and forget it. As things change, keep coming back and improving this page. It is that important. 

Conclusion

Most people do not realize how important the About page can be and therefore put little effort into it.

But, it is the second most read page on your site and is very important in starting to build a relationship with your prospects.

Take the time to prepare and optimize this page and it will help you convert prospects and increase revenues.

Don’t miss out on future blog posts about how to create innovative strategies that drive sales.

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

  Jump on this link to get on our free blog mailing list.

  If you have a question or comment, please get in touch with me. I would love to hear from you.

 

How To Be One Of The Few Successful Startups

Posted on by harborcapitalgroupinc

How To Be One Of The Few Successful Startups

Most startups don’t achieve the successful startup goals needed to continue in business. Why?

The main reasons given are they couldn’t find product-market fit, couldn’t generate enough revenues and ran out of money.

But, It doesn’t have to be like that. No one can guarantee a successful startup,

but if you follow the strategies used by successful startups, your chances of success are 9X better.

Now, You Can Build A Successful Business On A Startup’s Budget

Where to start

You think you have a great product or service idea but you need to make sure. So, you ask a couple of friends.

They all tell you, “yea, it looks like a great idea to me”.

There are no consequences for their answer and they don’t want to hurt your feeling, so they agree.

You now have some opinions, but no facts. To get facts, talk to people in you’re targeted audience. But, don’t tell them what your product is.

Instead ask them, during the conversation, if they are having n(the problem you want to solve) and ask them if they also have that problem.

If the answer is yes, ask them how they handle the problem and how big of a problem is it.

Better information. Better decisions.

Create your strategy

This means defining your objective. Not your goal, but a specific, reachable and measurable objective.

You will then be able to diagnose the problem and create an insight into how to solve the problem.

Then, decide what your company will do and will not do.

This is difficult because you do not have the resources to do everything. And ts hard to say no, we will not do that.\

Once that is done, you need to prepare a coherent plan on how to execute your strategy.

 Your strategy is your story.

Keep refining your strategy (core story) into your value proposition:

what you do, how you do it, what the results are, and how the customer benefits.

Get your story now to one or two lines.

Your strategy is your story, marketing is how you tell your story.

Embed your story into a marketing and sales messaging program designed to sell.

Your story will enable you to get away from just facts and features. For example, stop selling just grass seed and start selling greener lawns.

And if your product is technical, use simple language, analogies, and metaphors to sell your product.

A good example is when Steve Jobs introduced the iPod which held 5 Gigabits of storage.

No one could relate to 5 gigabits, so he held up the iPod and said you can put 1,000 songs in your pocket. That, they understood.

Use your story/strategy to become investment-ready

Successful startups also start immediately to use their story to become “investment-ready.”

The first question investors ask is “What’s your story?”

Because your story is your strategy, you will be prepared to tell investors

what your company does, why they do it, why customers buy from you,

and why this company represents an opportunity these investors will not want to miss.

Equally important, because you have done your homework and facts to back up your story, you will be able to answer their questions.

Answering their questions is critical. That is where they will go into depth with their questions and judge you and your idea.

Conclusion

Are you ready to learn the secrets of successful startups?

If you would like to learn more about the secrets of how successful startups are developed.

How you can develop your strategy, reach product-market fit quickly, create a business model that supports your story,

turn your marketing into a sales machine, and get investment-ready, grab a look at our website. You will be happy you did.

We have three options starting at only $39 per month, for three employees, including free email questions and with no contract. Cancel any time.

 

Why Business Stories Drive Success

Posted on by harborcapitalgroupinc

Why Business Stories Drive Success

 

Why don’t more entrepreneurs use stories to explain their business?

The reasons may be they don’t understand how powerful stories are and defining, and crafting a story takes time.

Another misconception is that stories are what the marketing department does. True.

 

But your story needs to start long before there is a marketing department.

If it doesn’t, you could be trying to wordsmith your sales communications later for short-term tactical gains because you don’t have a competitive advantage. Why?

Most companies have competitors and everyone is selling the same product at the same price with the same service.

Here is what Ben Horowitz, venture capital firm, Andreessen Horowitz says:

“The mistake people make is thinking the story is just about marketing, No. The story is the strategy. If you make your story better, you make your strategy better.”

The story is the engine that drives successful companies.

And with today’s technology, you can tell your story, many times for free, to individuals anywhere in the world.

That makes stories more important than ever.

Benefits Of A Story-Based Strategy 

Business stories drive success and will help you build and grow your company and your brand.

According to Kevin Smith the world’s most valuable, innovative, and fastest-growing companies,

regardless of age, industry, or size – know the story behind the brand. (Airbnb, Apple, Facebook, Tesla, etc.) delivers success.

Simon Sinek, author of the book “Start With Why” described the value of your story another way.

He stated that “people don’t buy what you do; they buy why you do it, And what you do simply proves what you believe”.

The following are some benefits you will get from a well-crafted story

Stories help you develop and sell your idea

1. Stories simplify big ideas in a way that sticks in one’s mind.

2. Data can persuade people, but data doesn’t inspire them to act.

3. Stories help you attract and keep talent

4. Stories help you transfer your beliefs to your audience

5. Stories help you keep all employees on the same page and focused on the same mission

6. Stories give your company a short- and long-term advantage over competitors

7. Facts are important, but stories connect and motivate people

8. People remember stories but not many facts.

 

Stories help you build a brand

1. Stories will build a foundation of trust, but a customers’ personal experience will cement that trust into something that lasts,

2. Buyers often look to the story to justify the purchase 3.

3. Stories can raise the value and therefore the price you are able to charge. If you can’t get a higher price for your brand, you need a better story.

Stories help you market your brand to potential customers

1.  Stories when done right can significantly boost lead generation by many times normal.

2. Stories grow your sales pipeline

3. Stories shorten your sales cycle and increase your  sales ratio

4. Stories make it easier for your ideal customer to recognize your value

5. Stories Improve the quality of your sales forecast because they attract better-qualified prospects.

Conclusion

If you are looking to use business stories to drive success and take your company to the next level, stories are a great way to accomplish that objective.

More information on stories is available on our advisor platform.

Also, see our blog,” Five Quick, Effective Ways To Tell Your Business Story”

Jim Zitek/ Harbor Capital Group

We empower entrepreneurs with the information, insights, and conviction they need to turn their ideas into a successful business.

How Do You Know When It’s The Right Time To Scale?

Posted on by harborcapitalgroupinc

Is It The Right Time To Scale?

The goal of every executive is that moment when you have product-market fit and you are ready to scale the business,

But understanding when that moment has arrived is difficult.

May companies jump the gun and begin to scale the product or the company too quickly and end up just burning cash.

Net; getting the timing right is critical.

If you have discovered a pathway to repeatable revenues, and you are beginning to get or have organic revenues (proving product-market fit), or have revenues

and are convinced you are ready to scale.

In general, you are correct about product-market fit, But these early sales are most likely from innovators and early adopters.

These early adopters represent about 16 percent of your targeted market.

And, are the easiest market to reach. They are looking for and want to be first with new products. 

Introducing a new product in a new market

You still have one or two obstacles to get over before you are ready to scale. 

If you are introducing a new product in a new market, according to Steve Blank, professor, author, and entrepreneur, www.steveblank.com

you do not have a ready market. You have to create this new market. So, as you run out of early adopters, you will have to educate buyers who are unfamiliar with you,

your product, and its benefits. That will take time, effort, and money to accomplish.

 

Therefore, after that early revenue peak, you will get new revenues, but revenues will likely begin slowing down rather than speeding up

until you have the mainstream market educated. You have to cross the chasm, the gap between the early adopters and the early mainstream market.

This chasm is well documented in the book by Geoffrey Moore, “Crossing The Chasm”, author and consultant.

How long this “education phase” takes depends on the product or service type and how technical or complex the product is.

So timing is critical because marketing costs from scaling up are rising, and revenues are not.

A lot of companies have been caught in this trap.

Introducing a new product into an existing market

If you are introducing a new product into an existing market, your goal is to take sales away from your competitors.

Therefore, the market exists. Therefore, you should be able to keep revenues growing incrementally with your better value proposition or lower cost. 

However, you still have to cross the chasm from early adopters to mainstream customers,

and they are more skeptical of your product or service and you than the early adopters.

It still takes time to educate and convince current users of a competitive product or service and switch over to your solution.

Therefore, you need to keep your revenue scaling more in sync with your revenue growth.  Unless, of course, money is no object.

Scaling operations is also very difficult. We will tackle that problem/opportunity in another blog post.  

Conclusion

Timing for a new product in a new market or an existing product in an existing market is a sensitive issue.

It depends on your development stage, type of market, and resources.

If you know someone with a timing issue, pass this on.

You might also be interested in our blog post, Transform Your Competitive Market Into An Uncontested Market.

You might also be interested in checking our website Harbor Capital Group,  The Proven Secrets Of Successful Startups.

Jim Zitek       

Innovation Strategies That Create More Profits