Have a business idea? Take these 3 steps
So you have your business idea, you already know what product and/or service you're going to sell, you know where you're going to get the inventory and you may even already have the domain and social media profiles setup.
But now what? What's the next step to building your business empire?
Check out these 3 steps:
1. Create the business plan
Yes, it's the B-word. And yes, I do believe in business plans.
A business plan is a document that outlines the business' goals, vision, strategies, and opportunities.
Are business plans a bit over-glamorized? Yes, indeed. While it's not necessary to have a 100 page business plan, they still provide direction and allow you to think through every step. Business plans also encourage you and your partners to do some market research and really brainstorm about all the potential nuances of your business that you may not have thought of otherwise. For example,
Company Goals & Vision
Competition & Market Research
Startup Expenses/Up-front Capital
SCORE is a fantastic resource for entrepreneurs (completely free, yay!) and they have templates you can download. Go here for the business plan template. I don't recommend spending more than a week on the plan, but it is critical that you get absolutely clear on your vision, your mission, and how the business is going to work. This is where the biz plan really comes to play.
2. Define your business model
Your business model is essentially how your business is going to make money.
It sounds trivial and a little corny, but I want you to think really about this. Your business model is everything. If you don't have a solid model, you aren't going to grow a wildly successful business with clear goals.
There are dozens and dozens of models to choose from. It seems like there are new ones popping up all the time. As our world and our technology is constantly changing, so is the way we engage with customers and how we sell to them. The good news is that there is at least one perfect model that works for you and your business. And guess what...YOU get to choose what that model is going to be.
Here are some examples of popular business models today:
- Subscription Model = where customers pay a monthly fee to access your services. A highly popular option, it seems like every one is trying to get a piece of your monthly expenses. Think Netflix, Hulu, internet, BlueApron, FabFitFun and Dollar Shave Club to name just a few :)
- Freemium Model = the product or service is free of charge and anyone can use it however it has limited capabilities. If a customer likes the product so much but wants 'more' now you can charge them for an upgrade to get full access and benefits. The viral video game Fortnite uses this model as well as Mailchimp the email marketing software.
- Direct-Sales Model = a representative (employee or you the owner) sells the product directly to the end-user. Many network-marketing companies use this strategy; such as Mary Kay, Avon, Rodan-Fields. They don't sell their products in retail stores, it's exclusively through their organization.
There's no right or wrong way to a business model. You just have to choose the right one for your business that makes the most sense. If you have no idea where to start, do some research in your industry. Take a look at your competitors and see the way they sell their products. If their model is proven to be a success, that may be the formula you need to implement for yours but of course you'll need to customize it and personalize it to fit your brand and your message. This is also a great way to find gaps in their model and you find a way to improve it and market to those same customers. Now that's a winning strategy.
3. Create the Sales Funnel
A sales funnel is a fancy term for the buying process that your customer will take on their way to purchase your product/service.
Also, the funnel will likely follow the AIDA model, a widely known concept in the marketing world founded by St. Elmo Lewis.
AIDA stands for Attention, Interest, Desire, Action
Example of what a sales funnel today may look like:
1. Customer arrives at your website through organic search, Google Ad, or social media (AWARENESS)
2. Customer clicks on your website and browses your store to see if there's something they like (INTEREST)
3. Customer found a product that solves their problem or matches what they've been looking for and can't see themselves without this product (DESIRE)
4. Customer checks out the reviews and testimonies and FAQs, customer is convinced this is the right choice and boom they enter their credit card information at checkout. (ACTION)
Keep in mind everyone's sales funnel may look drastically different. Selling T-shirts online will be a different business model and sales funnel compared to selling an exotic vehicle. Perhaps for your product, the customer needs to call for a quote or needs to come in to the dealership to sign loan paperwork, or a home consultation.
Regardless of the actual steps, all businesses need a clear sales funnel (step-by-step process). Understanding this will allow you to know what the customer experience will be like. Put yourself in your customer's shoes and think about every action they will need to take to buy your product/service. Is it too long? Is it missing steps? Is the website slow to respond? Putting this into perspective allows you the business owner to make sure the journey is seamless for the customer. Remember, all it takes is a few short seconds for a customer to determine if they want to move forward with your company or someone else's. Making this process as easy as possible will be a valuable move on your part.
By the way, there are numerous websites that help you build your online funnel, such as ClickFunnels and InfusionSoft.
Well LegendVest, that sums up all you need at this point. Once you have these three (3) critical things in place and you have intense focus, there's really nothing you can't achieve my friend.
Need help setting up your sales funnel or business model? Contact us and we'd be happy to help!