To Get Your Business Off the Ground, You May Need to ‘Prime the Pump’

To Get Your Business Off the Ground, You May Need to ‘Prime the Pump’

Prime the pump by allowing your target customers to experience your product of service with little no risk to ignite your business.

How do you get your business started from scratch and off the ground? In nearly all cases, you need to ‘prime the pump’. So what is priming the pump? In the 1800s, when you needed to use a water pump, you had to pour water into it to clear out the air in order to get liquid out of the pump. This is called priming the pump, and businesses are no different than that dry pipe where, ironically, you need to pour a little water into the pump in order to get lots of water out of it.

Many Business Leaders Don’t Want to Give Away Their Valuable Product or Service

At least once a week I meet a business owner or company CEO that is trying to ignite a business from scratch, and they are trying to charge every customer full price giving no discounts and giving no ‘freeware’. One of the most important things that you need to do when you’re working to get a business off the ground is allow people to experience it, even if it’s a reduced feature set version of your product, or a limited time or limited use offer.

Priming the pump allows your customers to experience your product or service and start the buzz. You need to get people talking, hopefully in a positive way, about what you are offering.

Building a Brand at QuestFusion

A big part of building a brand, especially an online brand, is giving a lot of stuff away for free. That’s difficult sometimes. Some of the stuff that you give away is incredibly valuable. I was at a marketing conference about two years ago, when I was just starting getting QuestFusion off the ground.

This keynote speaker was talking about giving away many of his advisory services for free. Something he said really struck me: “I like to make sure that my free content is better than the content that my competitors are charging for.” That really opened my mind. Here was a guy that was a very successful marketing advisor on the speaker circuit and generating a seven figure income from his business preaching to give incredibly valuable content away for free. At QuestFusion we have a lot of free content: blog posts, contributed articles in entrepreneur-facing publications, videos, webinars, and social media feeds. This free content allows people to get to know me. I also do small group seminars for free. These allow people to interact with me and get to know me even better. Someone has to get to know, like and trust you before they will do business with you. If you are a new business, how are people going to experience what you have to offer, and get to know you, if you charge for everything?

Growing a Brand as a New Entrant in a Market

In my previous CEO positions, I ran three different tech companies. I was a communications and entertainment tech executive for a decade before I became a CEO, so many people in that industry already knew me when I got my first CEO gig.

Now that I’m providing strategic guidance to startups on a broader basis, a lot of those people don’t know me. They can look at my background and reputation, but they’re still not going to want to do business with me unless they have an opportunity to see what I’m like. Those are the things that I do for free.

The Dilemma of Having One Big Expensive Product

It’s very unusual that you can’t have some kind of limited deployment, limited feature set version or a limited time offer of your product of service. One of the most important things is getting in front of thought leaders. If you do have something that is super expensive that is hard to give away in any way, work on ways to demonstrate the product to them. Prototypes and demos can be a lot less expensive, but still give customers a real experience. Have them use your product.

Examples of Your Product Need to Get in Front of Critical Reviews and Thought Leaders

In the tech industry, we used to do demonstrations and give products away to editors of technology magazines all the time, They want to tinker around with it. Dean Takahashi, who is now with Venture Beat, used to work at The San Jose Mercury News, and then at the Wall Street Journal. Walt Mossberg worked at the Wall Street Journal. These guys are tinkerers. They like messing with gadgets. Yes, maybe you have to give away a free phone or DVD player to those folks to get them to use it, but they’re thought leaders. They have an audience. People listen to what they say. They can be an amplifier on the things that you’re doing.

Who are the people that write to your audience? Who has authority? Who has a big social media following? Do they get a lot of comments and likes on the content that they post? Connect with these people, and give them your products and services for free.

Where Does Your Audience Hang Out?

Identify where your target customer hangs out. Does your audience listen to podcasts, read trade journals, read blogs, watch YouTube videos, attend certain conferences and trade shows?

Build a Tribe

When you are starting a business and building a brand, you should work to develop a set of people who say that your products and services are great. Sometimes this is called a tribe. Sometimes raving fans. It is said that you only need 200 of these people to ignite an online business. Get these people involved. Listen to them. Respond to them. Maybe get them involved initially on a free or discounted basis. Some of these people might even be affiliates or referral partners in the future.

Even Without Monetization, Have Other Goals for Your Giveaways

Ask for something in return when someone is sampling your product for free. Is it a testimonial? Is it a case study? Is it some feedback? Is it just their name and email? Get something out of the giveaway if you can. If you’re not getting the value of the product monetarily and you can’t monetize it right off the bat, at least get something back that allows you to understand and grow your business.

Part of the “ask” when you engage with customers like that is asking for a testimonial. You can say, “I’d like a testimonial. I want you to be honest. Talk about your experience with my product or service.” If you can, get it on video. If you can’t, get it in writing and put that on your website. Promote it using ads on social media channels like Facebook and Instagram.

Even in a Freeware Environment, Understand Your Value

What is the value of your product? What is the value of your service? In order to answer these questions, you have to understand the market, the problem that you are solving for your target customer, and the competitive landscape, including substitute products.

You may have something that’s 10 times better than anything that’s out there in the marketplace, but it will still be difficult to get people to use it unless they understand the value. How are you going to get people to use it? Sometimes you have to prime the pump. Then, as you establish traction in the market, you can start charging the fair market value for it. Keep in mind from the get go how you are going to move to a fair market value price, even if you give some things away for free in the beginning.

Overcoming Your Fear of Giving Stuff Away

There may be a lot of fear in your mind saying, “I’m going to give this discount to someone and now they’re going to tell everyone. Then I’ll have to sell my product for half of what I was going to sell it for.”

If that ends up being the case, then you haven’t managed your discount plans and pricing properly. Or maybe you didn’t have the value that you perceived in the beginning. If you’ve done your market research and you truly understand what’s available in the market today and how much your competitors can charge for their solution, then you can execute a value added pricing strategy, once the customer gets a taste.

To Win You Need to Grind

To win, you need to focus on winning. Don’t focus on failing fast. Sometimes winning requires you to grind things out. In a new company and new product launch, you quite frequently don’t know if failure to gain revenue traction is a problem with your product, your positioning or with you.

You have to engage with clients, friends and people who are willing to give you critical feedback in order to refine the story. Typically, if someone is unwilling to pay you for something, either it doesn’t provide the value that you think it does, you’re not promoting it properly to explain the value to the customer so that they understand it, they don’t think you can deliver the value that you purport, or they don’t like you. At the end of the day, it’s hard to figure out which one it is until you “prime the pump,” and test the market with products, product refinements, marketing messages, and demos.

This is Patrick Henry, the CEO of QuestFusion, with the Real Deal…What Matters.

Business & Pleasure in San Diego: Exclusive Interview with Michael Bosstick

Business & Pleasure in San Diego: Exclusive Interview with Michael Bosstick

I had the opportunity of sitting down to talk to Michael Bosstick, founder of Dear Media, (and husband to Lauryn with theskinnyconfidential.com) about all things fashion, marketing and business! Watch this video to learn how he has built a media company from the ground up and what his plans are for the near future!

Questions I asked Michael:

-How do you choose what you wear, especially in San Diego? (He loves black jeans and sweaters, find out why!)

-Which stores do you shop at most in San Diego? (He does not like going to most stores, beware.)

-Did you grow up here in San Diego?

-Did you used to party downtown a lot? (He loves Bang Bang just like I do!)

-I interviewed your wife Lauryn all about what she loves in San Diego. (Watch that interview here!) Where do you love to eat in San Diego?

-Who as the better diet? You or Lauryn?

-Do you have any special places you take your dogs in San Diego?

-How did you start Dear Media? Tell me a bit about your background in media/marketing.

-How does Dear Media help local email podcasters?

-What’s the biggest challenge you have when hiring new people into your company? (He thinks it’s very important to clarify your message from the top down.)

-What is life like with Lauryn? (He starts this answer with, “She’s definitely not the easiest!” Oh boy!)

-What’s your favorite platform on social media right now? (His answer may surprise you!)

-Do you think one social channel will become dominant? (He is a big fan of keeping control of your audience through blogs, email lists and podcasts.)

Talking to Michael was so informative, and I love hearing about what he and Lauryn are up to in San Diego, and all over the world! If you’d like to keep up with his daily shenanigans check out his Instagram profile (or listen to his podcasts since that’s where he is most active!) What was your biggest takeaway from this interview?

When It Comes to Your Personal Brand, Perception is Reality

When It Comes to Your Personal Brand, Perception is Reality

For people to do business with you they need to understand who you are, what you do, and what you stand for.

Who are you and what do you stand for? What are you an expert at? How do other people benefit from your expertise? These are all questions that relate to your personal brand. Your personal brand is just as important as your company brand, especially if you are a business owner, company president or CEO. Even if you don’t run a company, your personal brand is what you take with you when you change jobs.

Your Personal Brand: Analogy of Brand Image for a Product and a Company

To fully understand personal branding, it is critical that you understand product and company branding. Development of a company brand starts with your product and how your company goes about doing business. Let’s start with the product. In my book, PLAN COMMIT WIN®, I talk about the total product concept, which can be visualized as a set of concentric circles with the actual product that you sell as the center circle.

Your Personal Brand Total Product Description

 

  • Core Product: What you actually sell, and how you generate revenue. The core product includes price, warranties, delivery dates, packaging, any essential updates, and any product revisions that are supplied to customers.
  • System:  This is a product commercialization model, including your go-to-market plan, branding, promotion, and other marketing activities. It includes your customer support model, or the set of things you do that customers require or desire in support of your product.
  • Support: How you interact with customers, include support by your sales channels. Support, at its essence, is how you support your customers in using your product or service.
  • Infrastructure: Includes your sales funnel tools, your online platform, and your partner ecosystem. It also includes the personal relationships that you need to complement your current products and your product roadmap.

These concentric circles combined make up the total value proposition of your total solution.

For a product to sell, it must solve a critical problem for a customer and do it in a unique way. This is the unique value proposition of your product or solution. To solve a problem for a customer, you need to know who your target customer is. What product-market segment are you servicing? What problem are you solving for them? Why is your product better than what the competition is selling today or in the near future? That is your sustainable competitive advantage.

Most companies have a flagship product and focus market space. Every company started with the first product that established the brand presence. The brand is how people ‘feel’ about that product and your company when they think about it. Some of the worlds most well known and powerful brands include Apple, Google, Facebook, Nike, McDonald’s, Coca-Cola, Disney, Toyota, GE, Samsung, Microsoft and AT&T. However, there are much less well known brands that service very targeted niche markets, but their customers know what they stand for, and they love doing business with those companies.

As an individual, just like a product or a company, you also need to have a unique value proposition and a sustainable competitive advantage. You also need to have something that you stand for, and have ecosystem partners that work with you and complement what you are providing. What do you value? What gives your life meaning? How do you want to change the world in a positive way?

Your Personality As It Relates to Your Personal Brand

People buy from people. For people to know you and like you, they need to get a taste of your personality. I’m sure that you’ve heard this many times: “For people to do business with you, they need to know, like and trust you.” This is a statement about you, your company, and your product. Any person doing business with you needs to answer this question in their own mind: “Am I making a good decision by working with this person?”

Your Reputation As It Relates to Your Personal Brand

As Warren Buffet said, “It takes 20 years to build a reputation, and five minutes to ruin it. If you think about that, you will do things differently.”

Your personal brand is not just your reputation. However, people will not trust you and they surely will not buy from you if you don’t have a solid reputation. A person of integrity and credibility will have a better reputation, and a more reliable personal brand.

Branding: When I Think About ______, This is What I Think About

When people think about you, they need to know what you do and what you stand for. You have to be an expert in something. If it’s too broad people can’t “hook” onto it. People will usually just think, “This person is an interesting person, and I’d really like to know them and work with them, but I am not sure how.” Does this mean that everyone needs to know about every aspect of your personal life? No, it doesn’t. But, it does mean that a person should be able to get a feel for you, your personality, and what is important to you. What you value?

You need to describe and then demonstrate your expertise in your area of specialization for people to trust you and use you for their projects or buy your products and services. You must find a hook to get in the door and close any business.

Social proof is also critical. What do other people say about you? Do you have solid testimonials? Do you have strong case studies that demonstrate your expertise?

Personal Re-Branding

Not everyone loves what he or she does. If you’re looking to re-brand yourself, you’ll need to refine your personal brand, just like refining your product strategy as a company. It is best if you can move into an adjacent product area in an existing market where you have a brand, or an adjacent market where you have an established brand. In other words, if you hate your current area/focus, can you do something that is similar where you can use your expertise to move you forward?

This is not to say that you can’t do something totally new, but it will take more time to establish your reputation and brand if there is no leverage from your prior experience. Just make sure that you can bring something unique to this new area, and that you can sustain a competitive advantage. Otherwise you will just be another commodity in an overcrowded market.

Your Audience and Your Target Customer Base

Who is your audience? Your audience includes your customers, influencers and potential ecosystem partners. The ‘whole world’ is not a target audience. Every single company on the planet is not a target audience. You have to find something where you can reach a critical mass of people that can be potential clients, but also focused enough that you can establish your brand.

Next, you need to identify where your audience hangs out. What do they read? Are there podcasts that they listen to? What types of videos do they watch? Find those channels and use them.

What About Online Businesses?

In the online world and the era of the internet, this concept of people buying from people can sometimes get lost or diluted. So, I’ll say it again, people buy from people…not from bots.

So how does Amazon sell so much stuff? First, Amazon has an amazing reputation as an online marketplace. They are reliable and trustworthy. Jeff Bezos, the Amazon founder and CEO has a reputation of hard work and fair dealing. One of the most important parts of the Amazon marketplace is the customer recommendation section. People read the reviews from other customers, especially if they have never purchased from that supplier. When the integrity of these recommendations was challenged, sales dropped-off and Amazon had a massive crackdown to ensure the credibility and validity of reviews.

Potential customers also get a feel for you and your personality based on your online content. People will read your blog, watch your videos, listen to your podcast, and monitor you on your social media channels, before they do business with you. This is especially true the more your personal brand overlaps with your company brand.

Monetization

As Howard Hughes said about making movies, “This is a business. The purpose of a business is to make money. If it happens to make art, too, that would be secondary and accidental.” That said, these days many people are looking for a way to instantly monetize everything that they do. When building a brand, especially online, you need to give away a lot of content for free. In fact, your goal should be to make your free content more valuable than the paid content from your competitors.

Use your free content to develop and promote your audience, reputation, personality, network, and ecosystem. Ultimately this will build your brand. That said, you should have a goal for your free content. Are you getting testimonials? Are you developing case studies? Are you building your audience and your network?

At the end of the day, you need to develop a personal brand to create authority and thought leadership within your audience. What you stand for is just as important as what you sell. This is becoming even more true as more millennials and Gen Zers gain purchasing power and enter the workforce. Focus on developing your personal brand consciously, or you might end up with a brand that you don’t want.

This is Patrick Henry, CEO of QuestFusion, with the Real Deal…What Matters.

Hustle Doesn’t Make a Startup Successful – Strong Focus Does

Hustle Doesn’t Make a Startup Successful – Strong Focus Does

As a user of social media and online marketing it has been fascinating to me to see the emergence of ideas that will “drive success.” On one hand, you have Gary Vaynerchuk, who has a massive focus on hustling, giving things 100 percent, and working hard. On another extreme we have the constant promotion of “life hacks”, and Tim Ferris with his “four hour work week.” What is the right answer?

In my experience, and in the experience of countless other successful entrepreneurs and business leaders, there is a formula for business success, and it goes something like this:

1. Have a Great Business Idea

2. Have a Plan for Executing and Building Your Business

3. Set Goals and Key Milestones to Measure Your Results

4. Build a World-Class Team

5. Execute Like Crazy and Work Hard to Win

6. Find Ways to Improve the Productivity of Your Team and Yourself

7. Constantly Be in Learning Mode

8. Find Non-Destructive Ways to Stay Fresh and Recharge Your Batteries

9. Repeat

Working Hard and Hustling

I remember my coaches in little league baseball yelling at me, “Hustle!” This isn’t the hustle of scamming someone, this is the hustle of run your hardest and fastest. In this context, there was a goal: get around the bases as fast as you can without getting thrown out, with the ultimate objective of scoring a runs.

I am personally a proponent of working hard and hustling. However, hard work alone will not lead to success in business. My dad is one of the hardest working people that I know, and he had limited career success. Although he was able to provide a middle class lifestyle to his family, he never achieved wealth, or personal financial security. Yet, there is no substitute for working hard in business success.

Working Smart and Focusing

Working smart is also essential for business success, but it is not a substitute for hard work. Look at any athlete, business leader, or entrepreneur that has achieved sustained success over any reasonable length of time, and you will find someone that works hard and smart.

How do you know if you’re working smart? As an entrepreneur, you understand your business objectives and you set goals. The goals need to be SMART (specific, measurable, achievable, results oriented, and time bound). Then, you need to focus. You need to ask yourself every day and every hour if the stuff that you are doing is in alignment with your goals or not. If it is, then you are working smart. If it is not, then you can work extremely hard and not accomplish much business success.

Does that mean that you can never have fun, and never have any recreation? Not at all. Having down time is part of a smart plan, but you should also find work that you love so that you can find fun in work, if you want to be successful in business.

Working Productively and Hacking

I also believe in finding ways to enhance your productivity, but don’t find that life hacks are a substitute for working long hours. I also think that universal batching, universally turning-off alerts, and ignoring the news, are some of the dumbest business ideas of our decade. You don’t put your customers or employees into a pile and address things as you have time. Please, be a little smarter than that!

The Essential Nature of Goals and Focus

In my experience, nothing much positive happens in this life unless you are goal oriented and driven toward success and achievement. You need to have goals and you need to have a plan. Of course, you will make changes and adjustments as circumstances unfold, but that is not an excuse to not have a plan. A focus on winning is essential in a successful business venture, and in order to measure if you are winning, you need to have goals and set milestones that you can measure.

In our culture today, the culture of busyness, everyone is overwhelmed. I understand the temptation to find and create life hacks that simplify this. We used to call it “finding ways to be more productive.” However, what I have found to be the formula to success in business and entrepreneurship is to work hard, work smart, and constantly look for ways to be more productive. You can’t leave out any part of this. See yourself as a smart work machine. How much smart output can you create in the least amount of time. Your goal is to not only beat your competition, but to crush your competition. You want to beat your competition so badly that you not only leave them in your dust, but they can’t even see your dust.

This is Patrick Henry, CEO of QuestFusion, with The Real Deal…What Matters.

This article originally appeared in Inc Magazine.

 

Timing is Critical to Startup Success – It is Different from Luck

Timing is Critical to Startup Success – It is Different from Luck

When Bill Gross said timing is the single biggest reason that startups succeed, he was not talking about luck.

Bill Gross from IdeaLabs gave a very famous TED Talk a couple years ago about ‘timing’ being the single biggest reason for startup success. Many entrepreneurs feel that this means that success and failure is significantly based on luck. This isn’t really the case.

I’m sure you’ve heard the saying, “don’t try to time the market.” Timing the market in this context is about predicting when the broader stock market will increase or decline in a step-function fashion. Although it is sound advice to not try to time the broader stock market, it is absolutely essential that you work hard to time the market as it relates to the potential explosive growth of your target market in a startup.

In almost all cases with the launch of a new product or service in a startup, there is a broader ecosystem that must be emerging or in place for your business opportunity to have great potential.  As far as market opportunities are concerned, you’d like to “drive on a paved road” as opposed to “chopping through the jungle with a machete,” so to speak.

So how do you understand and predict if your business opportunity has good timing? It really relates to your ability to assess the broader ecosystem of things that are needed for your business opportunity to ignite.

When it comes to market timing, you can be lucky, or you can be good.

It is possible to have good luck and intersect a great market opportunity, but it is always better if you can ‘look over the horizon’ of the market and see broader trends that will positively or negatively impact your ability to drive a rapidly growing business. One of the tools that I have found incredibly valuable in this context is change factors analysis, which is sometimes called PESTEL analysis.

PESTEL stands for political, economic, social, technological, legal and environmental factors that can impact your market. Another tool, popularized by Harvard Business School professor Michael Porter, is Industry Structure Analysis, also known as Porter Five Forces Analysis.

How to tell when a market is ready to ignite.

Although you can never predict with pinpoint accuracy when a market will ignite, you can have a pretty good idea within a couple of years. It is essential that you understand in great detail the specific ecosystem factors that impact your target customers’ willingness and ability to adopt your solution.

In a startup, you don’t want to be a salmon. You want to swim with the stream and not against the stream. You also want to take advantage of the incumbent competition’s inability to address the customer pain point because it would destroy their current business. This is the case even if the current solution to the customers’ problem is doing nothing or doing something in a vastly inferior way than what you are providing.

Being a little early is okay, but being late is a disaster.

As a startup, it is okay to be early to market as long as you aren’t massively early to market. If your product is available within 12-24 months of the perfectly ripe market conditions and you have delivered a best in breed solution with a significant price-performance advantage versus alternative solution, you have executed with very good timing.

As a startup, if you are late to market, you will likely lose. Only fast followers that differentiate primarily based in a superior cost structure due to scale can win as a follower.

Work hard to understand the PESTEL factors that positively or negatively impact your markets. Understand what is inside your control or sphere of influence, and understand what you purely need to monitor.

Look at your industry structure and how it can effect adoption of your solution. If you do this, you can make your own luck as it relates to timing.

This article originally appeared in Inc Magazine.

 

Why Being a Good Storyteller Can Make You a Great Businessperson

Why Being a Good Storyteller Can Make You a Great Businessperson

Engage the mind and trigger the imagination of your audience to engage them at a deeper level.

Do you want to be more successful at selling your products and raising growth capital for your company? Then you’ll need to learn how to be a good storyteller. Your stories need to be meaningful and relevant to your business and to what you’re trying to accomplish.

Try to describe the unique value proposition of your product or service. Is it simply a collection of facts, features and benefits? Does it address the customer problem, and your solution? A good storyteller can describe the target customer’s problem in a way that engages the mind and imagination of his or her audience. This storyteller can create a visceral reaction to the problem, the swoop-in to the rescue with their solution that eliminates this customer pain point.

The Basic Story Plot Lines

As described in the book The Seven Basic Plots: Why We Tell Stories by Christopher Booker, you have the Quest, the Voyage & Return, Comedy, Tragedy, Rebirth, Overcoming the Monster, and the Underdog. Added to these seven plots in the mid-nineteenth century was the Mystery plot. All great stories follow one of these plot lines. It allows the listener to understand the story in a clear framework. Every terrific movie that has been produced and every successful book that has been written, including business books, follows one of these plot lines.

The Psychological Power of Storytelling

As discussed in article by Pamela Rutledge in Psychology Today“The Psychological Power of Storytelling”, she states, “Stories are how we explain how things work, how we make decisions, how we justify our decisions, how we persuade others, how we understand our place in the world, create our identities, and define and teach social values.” She goes on to say, “Stories are the pathway to engaging our right brain and triggering our imagination. By engaging our imagination, we become participants in the narrative. We can step out of our own shoes, see differently, and increase our empathy for others.”

Bottom line, storytelling engages a different part of the brain that is not as defensive.

Storytelling in the Context of Business

A story can make a complex business or technical issue much easier to understand and comprehend at a deep level even by a lay person. Stories can take the form of a metaphor, an analogy, a case study, and example or a layman’s description of a situation. In the context of describing a problem for which you have a solution, or a unique value proposition, it is ideal to create a visceral reaction in your audience – they can actually “feel” the pain associated with the problem, and that they feel the “relief” associated with your solution. There is no other way to do this other than storytelling. Your stories need to have a hero, the customer, and a villain, usually a big problem that needs to be solved. Your company provides the solution or cure the problem, and you can be the wise mentor or guide in the solution process.

Great storytellers engage the mind of their audience, and they learn how to touch their hearts. In all good stories, the plot goes through a period of conflict and then conflict resolution. You need to do that in business to engage your audience whether it is a customer or a prospective investor. When you tell a story in this way, you can stir the imagination of your audience, and get them to understand what you do at a much deeper level.

Learn how to tell stories, and improve your chances of success, sell more product, and raise needed growth capital for your company.

This article originally appeared in Inc Magazine.

 

Page 1 of 1412345...10...Last »