2. Today, I’m going to talk about the ways that you can filter for a
potential business idea.
So we’ve sat down with a few business owners and each one of
them wanted to start a new venture. So I pulled out my project
stream which is a systematic checklist of taking an idea from start to
finish, and we get up to the business model part and that’s where I
have a set of filters that helps me determine what sort of business I
want to go into.
3. So we went through that checklist and I thought you might really
enjoy finding out the things that I would look for in a business, and
perhaps you might have some of these in your business. So let’s go
through the list and see how your business stacks up.
4. Look for a lifetime customer model
The first one I look for is a lifetime customer model. This is where
you get one customer and you keep being able to service them for a
long time. This is more profitable, it’s much easier and you actually
don’t have to focus all of your efforts on customer acquisition or
customer traction, or paid traffic, or conversions.
5. Once you have that customer, you can focus on the customer and
looking after that customer and keeping that customer for a long
time. That customer, when they’re happy, will actually bring other
customers and continue to purchase. So that’s the first filter: the
lifetime customer.
6. Prepare for a long-term commitment
The other thing I look for is the long-term commitment. Are you
interested enough in this and are you expert enough in this to be
able to surround yourself with the information you need to serve
this market? That means you may want to go to events. You may
read trade journals. You may follow blogs. You might listen to
podcasts.
7. You have to be able to have that conversation with the customer for
a long time. That’s a long time in one market, over a decade, and you
have to be able to have that conversation over and over and over
again. So surround yourself into a market that is something you’re
happy to talk about and happy to stay up with.
8. Seek the ideal price point
Look for the right price points. If you go into a very low price point,
or very low margin business, you can expect very aggressive
competition and people will come and go from that market as they
go out of business. I like the selected intermediate to advanced
pricing level because you automatically have different customers.
9. You have enough margin to have a great business and there’s less
people in that market. Almost everyone is scared to compete in that
mid- to high-priced point level. And you’ll find this really good
customer. A lot less people serving that customer and it’s easy to
stand out. So whether to product or service, pick the middle if you
can and go up from there.
10. Consider scale
The next thing is scale. Do you actually have enough audience that
you can grow this and still have a business? I’ve made the classic
mistake of niching down too small and running out of audience. You
could be the biggest fish in the pond, but if your pond is a goldfish,
then that’s kind of limited.
11. So pick a big enough market that you can enter into and specialize or
niche to the right part of the market that allows you the growth.
Because you’re going to be confident, because you’re going to be
following these sort of tips that I put on here, you will be able to
grow into a bigger fish and you’ll grow into a bigger pond if your
pond’s a little bit bigger to start with. So don’t go micro super niche
just because it’s easy and because you get a fast start. You will run
out of growth and you’ll have to start again.
12. Your capacity to supply
The next one is capacity to supply. You have to be able to actually
supply the market. There’s no point going into your business model
if you can’t actually find a source of supply. Whether that’s you,
whether it’s a team, whether it’s an external supply, you need to be
able to find supply. And I see a lot of people running into this
mistake.
13. They think they’re going to go into a business, they set their prices
low and they’re either doing the work themselves, in which case
they run out of capacity because you only got 180 hours per month;
or they get a small team and they just can’t keep up with supply and
they find it too hard to attract and recruit a very small team and
keep them sustained. So go and look for quality supplies.
14. Make sure your business solves a problem
Make sure that your business solves a problem. If your business
doesn’t solve a problem and if there isn’t an audience of people out
there who have that problem, then it’s going to be a tough job. So
start with the audience if you possibly can.
15. As the great Gary Halbert used to say, give him just the starving
crowd, that’s all it needs. So start with the audience who has a
problem that you can actually solve and look for a large market of
people with huge problems. The bigger the problem, the better the
solution will appeal to them.
16. As the great Gary Halbert used to say, give him just the starving
crowd, that’s all it needs. So start with the audience who has a
problem that you can actually solve and look for a large market of
people with huge problems. The bigger the problem, the better the
solution will appeal to them.
17. So, now if you have some of these filters in place, you should have a
pretty decent business model that is going to do what you need it to
do. And I’m sure, as this has worked for me and many of my
students, it’s also going to work for you.
18. What I’d really like you to do is ask your questions right near this
video or comment below this video if any of these have resonated
with you. Perhaps you made a mistake with one of these filters and
it’s cost you dearly like it has with me. Perhaps you’ve nailed it, you
have it right and you have a fantastic business. Tell me about it, right
near this podcast. I’ll catch up with you soon.
