In Part 1 and 2, we raised the importance of setting out on your entrepreneurial journey with an overarching strategy. Guiding your strategy should be your vision underpinned by a set of meaningful values and provide for where and how you offer competitive value to the market. As your start-up launches, your business strategy unlocks each step along the way, readying your answers for the tougher questions.
Rather than solely guiding from a bird’s eye view, part 3 empowers you for the present and future decisions.
Entrepreneurs typically juggle a range of roles outside of their wheelhouse. You will never be an expert in every area of business but enacting forward-thinking strategies from the outset makes life manageable.
Show Me the Money – Keep on Top of Your Finances
Nobody departs on their start-up campaign unappreciative of the part money will play. For some it haunts you, for others it is consistently precarious and for a select few financing alleviates the immediacy of the issue. Either way, it is important so remaining actively aware reduces stress later.
Honestly and astutely assess your finances. How much are you starting out with and how long will it last before you need to have made sales? What are your biggest expenses? How many sales do you need to break even? You will need to keep on top of finances for decision making, anxiety and expansion reasons.
Financial awareness becomes even more important when you are planning to procure seed, venture, angel or any type of capital investment. When are you going to look for financing? When you have a date, subtract a few months!
Deciding you will get an investor when you reach a certain sales figure or date is great but who is to say that is when you will receive it? Perhaps you need it quickly but a huge market opportunity has vacuumed up prospective investors. Never wait until you need the money to find it!
Build, Break, Fix – Reduce Your Use of Resources
One of the major reasons for the success of Google is the time it saves users. Do people even know how to find solutions anymore without it? Google is saving hours per week in easily accessed information.
Time is a vital asset to you and your customers. Every efficiency advantage gained improves net profits or reduces prices. Time is quite literally money. Build the examination of your systems into ongoing practices and understand where you are losing resources. Once you find an obvious inefficiency, rectify it. Time is a commodity for a start-up, don’t waste any!
Given that we are living through the digital age, there are innumerable technological solutions available. Where do you need help? What benefits could be made with a project management or business intelligence software solution? Market comparison evaluators such as Olive or Capterra even take your list of needs or improvements and find suitable software solutions. Incorporating technology is the strategic move that empowers decisions from market, operations, administration and otherwise.
Show and Tell – Develop Your Marketing Strategy
Poor marketing and shallow market need account for 56% of start-up failures. That is the level of importance your marketing strategy can hold. For all you have heard about digital, social, traditional, outbound and inbound marketing; they all revert back to the classic marketing mix, the 4 Ps.
Product – What are you selling?
Don’t underestimate the importance of really getting to grips with what you actually offer. Google is a search engine but it really offers time and solutions. Your product or service needs to address the needs of a consumer base and should stand definably separate from competition. Does it solve customer problems faster, better or easier?
Without understanding what your customers are after and how you satisfy the need differently, it will be difficult to make a splash in the market
Price – How much will it cost?
Pricing may seem cut and dry but there are strategic perceptual benefits to be aware of. Having a tone deaf pricing strategy is damaging as perception and buying behavior is driven in large by price. Perhaps that’s obvious, but look at your market closely. Higher prices indicate higher quality, while lower costs appear as the no frills basic alternative.
- What does your pricing say about your product?
- Are customers willing to pay more for better quality?
- What impact does a price change make to your customers?
- Will you have tiered or introductory pricing?
- What is the lowest price you can afford to sell at?
- How will competitors react to your strategy?
You might feel you need to undercut competitors but price wars usually end in a race to the bottom which, for a start-up, can be a disaster. Established companies often have the means to enact predatory pricing meaning they undercut you for long enough to drive you out of the market.
Place – Where will your product be seen?
Long before the digital age commanded trillions of marketing dollars, place referred to where you opened your store. Business owners would look for the location with the best exposure to potential customers or most convenient location. Nowadays it is much more than that. Place extends to digital and social media locations with the rules of convenience and in view of customers continuing.
Researching your customer tells you all that you need to know. You are unlikely to attract Gen Z buyers by advertising in newspapers just as you are hidden from Boomers by advertising on Instagram. Of course there are exceptions but think for the majority.
Keep the following in mind:
- Where do they purchase from? Physical stores, online outlets, Facebook? Will E-bay, Amazon, Alibaba, Wish or any other large scale platform be required?
- Where are your competitors selling?
- Are your offerings B2B or B2C?
- Do you need a delivery option?
Promotion – How are you going to leverage the previous 3 Ps?
Let’s be frank, any potential success of promotional efforts relies on optimization of the product, price and place.
Promotion encompasses public relations, advertising and marketing campaigns designed to highlight why customers need your offering. Promotion typically aligns with place as deciding where to advertise is the first step. Knowing where your customer will see an advertisement is obviously vital but just as important is the message.
People are subjected to endless amounts of advertisements to the extent that subconsciously we recognize and scroll past unrequested ads. Canvas your target market and competitors to understand how they are reached. Content, email, digital, print or traditional marketing are typically the channels to choose from based on what is most effective. Once you know what avenues you need to pursue, craft your message. Customers are beyond wise to tricks of the marketing trade. Honesty is often the most endearing characteristic.
- Acknowledge the pain in the customers experience
- Adopt a relatable tone and voice
- Create campaigns based on the customer view
- What benefits do the customers get? Features tell, benefits sell!
Keep a Finger on the Pulse – Listen to Your Customers
Not subscribing to ‘the customer is always right’ is acceptable in some instances but not when it comes to refining your messaging and offering. The main thing to understand is the customer is almost always right about what they want and you deciding otherwise rarely goes anywhere positive.
Survey customer opinions and really digging into what they want out of your offering empowers you. Customer feedback, whether positive or negative, is an opportunity to learn what they value. Established companies have a tendency to become a little self-involved, forgetting to check in on what matters to the customer. Being in touch with the most important details means you can create an offering that nails it every time.
Ultimately, entrepreneurial success is built on effective, informed strategies and although it can feel intimidating or exhausting, they are worth it. The main thing to remember is don’t get stuck in the mud worrying about what will and won’t work. Enact a strategy, try it, review it and improve it. Dare to fail quick and learn quick. A strategy is simply making a decision on the future steps to success based on logical reasoning!