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That’s Awesome! but where’s the money?

Creating a product or a service that stands out in the marketplace is a huge part of the way the disruptive economy works. Customer and market research often favors a disruptive, innovative, or shocking marketing or delivery strategy.

But on the road to recognition, don’t lose site of the goal.

Your business must make money (not to be confused with profit).

Your market research may indicate that you get a ton of positive brand credibility for your new edgy approach, but does it turn into money? One of the questions that needs to be asked beyond “How much would you pay for this?” is “Will you cut a check right now for that price?”

A big hole in the novelty problem is that we socially reward attention getting behavior or products, but it is unsustainable. The X-ray shoe machine of today is the cancer lawsuit of tomorrow. Even as a best case, can your product be disruptive forever? Patents do run out. Marketing moves quickly and even the disruptive stuff soon becomes commonplace.

Too often, on the way to be different, we end up with a business that is disruptive for disruptions sake. If we don’t have a way to monetize such a strategy; what happens after the disruption stops working?

If marketplace disruption is central to your product strategy, you are destined to fail once that disruption normalizes. Once you’re run of the mill, you’ll have to go back the old standbys speed, quality, or price.

The world needs trailblazers to be sure; but don’t forget to pickup the check on your way to the next big thing. If you do, you might find there’s no one there at your destination to pay the bill.

Growing a business is often a bit like trying to juggle – lots of balls in the air and all of them important: each needing focus and attention. First you spend on marketing, then sales, then operations, then all of a sudden: marketing needs more attention again. This juggling act is tricky!

This up and down relationship between Sales, Marketing, and Delivery functions creates a problem when trying to scale your business to meet market demands. It is why most freelancers never make the jump into ownership of a business, and instead stay stagnant in their size and scale.

Enter the solution: Functional Outsourcing.

Functional outsourcing is an approach to scaling your business that helps an owner make the transition to management. It’s a lower cost, lower impact way to begin the process than directly hiring a new employee. Hiring is expensive both in time and money and the success rate for newer business owners is very low.

So what is functional outsourcing and how can I get some?

Functional outsourcing is, simply put, taking a function in your business and having it performed by a third party. The narrower the function the better. By example, a function in the marketing department might be content generation. Here at RentASmartGuy.com we outsource that function to a delightfully skilled content team. We set the tone and topic and they turn it into the marketing poetry you are currently reading (hehe).

The functional outsourcing concept is nothing new. People have been buying professional services for years. In this case; however, functional outsourcing is used to free up resources and time from the owner in a space that they traditionally have done on their own. Often times in a space that the freelancer/business owner had never considered getting help for.

Progressively moving across the functions of the business until no more outsourcing candidates are left then lets the owner start the insourcing process – hiring employees on the delivery or sales side of the business. As the business grows further, you can then hire employees for your previously outsourced work.

Functional outsourcing isn’t the best answer for everyone, but for most people looking to make the leap from freelancer to business owner it’s the best first step.

Business is a communications exercise. If you are not communicating well problems emerge almost instantly. Independent of supply chain, service delivery, execution and the operational functions of a business, communication is the most critical element of business success.

The good news is that much of what you need to be a successful communicator you have been practicing for a long time. Assignments that you received in primary school have prepared you (perhaps against your will) for business communication success. When trying to improve your communication skills it might be helpful to tie back into this learning from school and bring it to a contemporary parallel.

Broadly it helps to look at communication from two contexts: people who know you, and people who don’t.

On the “people that know you” side: Consider messaging as a means to prevent issues or minimize the impact of situations that go badly.

An informational message is similar to a book summary you wrote back in primary school. You capture the important points, highlight how they are relevant, and describe the overall outcome of the narrative. This translates into status reports, project proposals and all manner of status communications.

On the “people that don’t know you” side: Consider marketing.

A marketing message is very similar in spirit to the persuasive letter many of us were tasked to write in grade school. A persuasive letter contained a series of concepts designed to help the reader: establish rapport and credibility; write simple statements outlining the request; and create a call to action. These fundamentals easily translate into marketing concepts and can help improve its effect.

Underpinning all good messages are a few important philosophies.

Emotional content compels personal action. Rational content compels organizational decisions. Use emotions in your marketing – not your status updates.
Simple messages remove the chance for misinterpretation. Simplicity is often hard to achieve. Take the time to make things simple if you want a better outcome.
More communication is better than less. The severity of an issue or problem is a good indicator of how often you should connect.
Never surprise the person you are communicating with with bad news. Alert people to the possibility of a negative outcome when it remains a possibility and is not yet a fact.

Taking these philosophies into account can make the difference between a browser and a buyer, or a furious or delighted customer. Communication is a skill and as such it takes time to develop. Invest in developing the skill and it will pay huge dividends for yourself and your business.

With all the buzz over the past few years about branding it’s important to know the difference between branding and packaging. Branding is for your company. Branding is a type of corporate personality that consumers can build a relationship with. Think of it as the “first impression” you make when meeting someone face to face.

Packaging is something different. Think of packaging as the box you put ideas into. Ideas in this case can be, services, products, training programs, etc. How you package ideas should be influenced by your brand. For example, if your brand has a rustic feel, you packaging should be equally rustic. If your packaging is hyper glossy and sleek, so should your brand be sleek and modern.

Additionally, when packaging ideas or services, they should be easy to understand. If you paint houses, for example, you might list the cost per square foot of wall space with instructions on how to figure out your square footage so that the customer can price out the job (to a degree) on their own. Services such as design or consulting can be bundled together to create a complete product or outcome. Training concepts can be packaged in a series of supporting concepts that create an overall understanding.

Packaging is an integral part of providing services or delivering products. Companies that do this well are wildly more successful as they have made it easy to do business with them. Time spent bundling and packaging products and services will increase your close rate on sales and minimize your returns and refunds.

When you make it easy to do business with you, you get more customers.

Customers that find your product or service easy to understand and purchase will be much more likely to do so. Are you removing the nonsense from your sales process?

A recent customer of mine in the trades worked with me to re-define how they sell their services. What was once a 2, 3, or four WEEK process now happens in a quick phone conversation. His close rate increased to over 80% as a result up from 20%.

If you make it hard to buy with long complex intake forms or other such nuisances, your customers will not be able to quickly make the financial commitment to working with you. Your business may require a significant amount of background information to help deliver a product or service – put that data gathering after the purchase and you will find that your sales increase significantly.

You should always endeavor to make working with you as easy and straightforward as possible. Think about your product or service packaging as well. Does getting involved with your product or service require a significant special industry knowledge? Does it need to?

Even the most involved and complex business models can be simplified to the benefit of your customer (and your employees). Consider this if you find your sales flagging or your prospect pipeline not converting. As always, if you need it, the folks here at RentASmartGuy.com can help – Sales Process Reviews starting at $750.

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