Super Business Model: The Foundation of Business Development

We hear the term business model all the time, but how often do we stop to think about what that really means? Most businesses build the concept into their planning, but a full understanding of what makes up a business, and therefore a revenue model will make any business plan better and make the business more likely to succeed.

Here’s what you need to understand a super business model, and define the one for your startup.

Defining Moment

First, we need to start with some definitions that, while you may have heard them before, you may not have put them in context of a business model. We’ll define them briefly in this section and dive deeper after that.

Business to Consumer (B2C): You deliver goods or services directly to customers. Common examples are software, apps, retail both e-commerce and physical, the food service industry, and more.

Business to Business (B2B): This model means your business provides goods and/or services to another business. Many Software as a Service (SaaS) companies like MailChimp, office supply companies, and equipment providers work primarily on a B2B level.

Business to Business to Consumer (B2B2C): The most common companies in this category are media companies or social media companies. They provide content and services and a platform for customers, but they also provide ad space to businesses. Therefore, the business pays the social media company for an ad, and that and other information is delivered to the customer. Think Google, the ads in your search results, and the organic listings.

The Blended Approach: Two of the first companies that come to mind are Apple and Microsoft. Both offer hardware and software to individuals, but both also offer apps and software and even hardware geared toward specific businesses. This is because their products are appropriate for both applications. This is a great business model, because multiple revenue streams are built in.

Revenue and Cashflow: Revenue is the money that pays business expenses and ideally creates a profit. Cashflow is the money you have on hand at any one time to pay for short term operating expenses.

These are quite simplified definitions, but they establish a foundation. Your business model defines where your revenue comes from, and in most cases also determines how much cashflow you need to operate on a regular basis.

Super Business Model Revenue Streams

The most common way to define your business model is to look at where your revenue comes from. Ideally any business will have more than one revenue stream. Where that money comes from defines your business model.

Let’s use a content business and their revenue streams as an example. As we will quickly see, there are several sources of revenue. As an easy example, we’ll look at Hulu.

What are the consumer options with Hulu? Well, the lowest cost to consumer is a subscription model with ads. Why can Hulu offer this at a lower price? Because this is a B2B2C model: the consumer pays a subscription price, which is one source of revenue. But advertisers also pay Hulu to deliver their ads to the consumer during programming, therefore creating a second stream of revenue.

The next level is a subscription model: the consumer pays more, but in exchange they don’t see ads. This model is now more strictly a B2C model: the revenue comes from the customer directly.

The third model involves bundling: Hulu’s parent company Disney also owns other streaming properties, and so to increase revenue overall, it offers a discounted, bundled subscription available in both ad supported versions and an ad free version. The bundle is cheaper than getting all three services, and although profit per platform is lower, the company profit overall is greater.

The point here is to illustrate a business that has a couple of key things:

• Multiple revenue streams from not only multiple apps, but multiple business models.
• Revenue from both businesses and consumers.
• Multiple options to satisfy various types of customers.

But now, let’s break down those revenue streams and apply them to other businesses.

Super Business Model Applications

So we just looked at one content model, streaming shows and movies. But there are aspects to the content model and they can apply to other business models as well. Here are some applications and the kind of model they generally fall into.

Subscriptions: Originally this might look like a content exclusive model, but companies like Dollar Shave Club and Chewy have shown that people will subscribe to pet food and razor deliveries as well. This is a business to consumer (B2C) model in most cases, as the customer is paying for a product or service on a regular basis.

However, it can be B2B as well. Businesses don’t order razors (don’t try to deduct that on your business taxes, trust us), but they do subscribe to software from Microsoft Office to QuickBooks or industry specific software. They also may subscribe to industry publications.

The point is to not get caught up too much that one model or another fits a specific category.

Advertising: This is a simple one. You “share” your space with another business in exchange for money, affiliate payments, or some other compensation. A business will often do this with their software provider, earning more than the cost of their annual service. This is a strict business to business model, as it’s a rare instance when an individual wants to market themselves outside of online dating apps.

Transactions: This can be B2C or B2B, but essentially you are selling something. This can be a one-time purchase (for instance from Chewy) of something that is non-consumable, or that a customer only wants one time. For example, although you may want a new bed, you probably don’t need one every month or even year, so a subscription doesn’t make sense.

That’s the main difference form subscription business models. Transactions are one time or irregular purchases at the customers discretion, rather than a weekly, monthly, or even annual purchase.

Selling Data and Analytics: Careful here. With GDPR and the California Consumer Protection Act, buying and selling consumer data can be a risky proposition for both sides. However, companies who do surveys, gather census data, and bring together other information are still quite viable. Anonymized data is one thing, as are analysis services and programs. This is always a B2B model: while you might want to compare your lawn to your neighbor’s, you probably don’t need a lot of data for that.

Other revenue streams: Maybe your company has archival data, or software or media you can license to others. (Companies like Shutterstock do this with photos). Events and conferences or breaking into the sharing economy are all revenue streams, some B2B or B2C. Some can even be harnessed as B2B2C, like distributing ad flyers with food delivery so you get money from both advertisers and consumers in a single transaction.

Don’t limit your revenue streams or even your business models to the ones above. Innovation is the reason many of them exist, and that others will come into existence.

Conclusion

All this information is not just designed to spark ideas. It is also to help you categorize your business and revenue models. The better you understand where your money is coming from, the better you can target your goods and services to the right people. Your business and marketing plans and even your cashflow planning are all based on this information. A super business model begets a better business plan, which leads to long term success.

What’s your business model? Where is your revenue coming from? Let us know in the comments below. We’d love to hear from you.

Posted first on http://www.evolutionacceleration.com/

10 Quick Tips for Growth Entrepreneurs

Growth entrepreneurs are those who really want to grow their businesses beyond what creates a comfortable living for them and their families to something that has a much wider impact. While many jobs are created by startups and small businesses, business expansion has a much larger impact on the overall economy.

Many studies show that companies often want to grow, but they often don’t know how. They think more marketing, more effort, and more time spent on their business will automatically create growth. The reality is something more complex. Here are ten tips for growth entrepreneurs who want to grow their business further but might feel stuck.

Track Your Cashflow and Never Run out of Money

Many startups focus on profit, and not cashflow. Cashflow is the money you have to conduct day to day operations. If you own a pizza restaurant, and you have a good profit margin, but you run out of money at the end of the week to purchase the ingredients for more dough, you can’t keep doing business.

The key is to focus on both cashflow and profit, and never run out of money. Before you go spend that money on a digital marketing campaign that sounds great, make sure you have your operations budget covered first. The failure to properly track and manage cashflow is the reason many businesses don’t succeed and even close in the first few years they are in existence.

The key is to start small, scale, and do what you can afford.

Know Your Niche and Your Market

This tip feels like it should go without saying, but many entrepreneurs start their businesses with a knowledge of one market segment and they stay there. But markets and niches change, and it could be that by offering one small additional service or product, or by making a small change, a business can grow substantially.

What does this really mean in the day to day operation of a company? Ask your customers what they need and determine if there is something more you can do for them. If there is, do it.

Get to Know Your Current Customers

One of the best ways to know your niche and your market, and therefore to grow, is to get to know more about your current customers. You can do this through surveys, social listening, website analytics, and just having conversations with them. Knowing what your current customers want and need can drive your next business innovation and spur growth.

A common mistake startups often make is to focus so much on finding the next customer, they fail to get to know the customers and clients they already have.

Offer Exceptional Customer Service

How do you keep those current customers happy? How do you turn new customers into regular customers and clients? How do you stand out from your competition? Offer exceptional customer service. Customers can compare companies based on price and many other factors, but they most often return and do business with companies who they like to do business with.

Nurture Your Customer Base

Do you offer coupons and reward programs for loyal customers? Referral bonuses? Do you upsell when practical and applicable? Do you keep in touch with your current customers on a regular basis?

While there are any number of ways to nurture your customer base, the important thing to remember for growth is this: if you keep your current customers happy, they will become ambassadors for you and spread the word about your business to people they know. According to PR Daily, 83% of consumers buy based on the recommendation of a friend.

Look for New Opportunities

Is there an ideal place for you to open a second location? Is there a small company you could partner with (or even purchase) that would allow you to offer a new service or reach more people? What opportunities does your company have to expand in new areas?

The key is to keep an eye out not only for traditional opportunities, but the chance to innovate. If you can offer a unique product or service that meets your customer’s needs, growth is nearly assured.

Automate Whenever Possible

More often than not, entrepreneurs who want to grow will talk about the fact that they don’t have time. That is often because they are too busy doing things they shouldn’t. Many things, like basic social media management, website responses, and other items can be automated.

Even an A.I. chatbot can field many common questions, interact with customers for you, and only pass them to you when essential. Automation of processes has come a long way, and it allows you to focus on more meaningful activities.

Focus on Marketing and then Advertising

Marketing is made up of both research and practice and involves both paid and free methods for reaching customers. Advertising is the practice of reaching your customer. The more research you do ahead of time, the more likely you are to reach the customers who will actually buy your product or use your service. Always do the research first, so your advertising efforts re most efficient.

Don’t Get Distracted by Something Shiny

Innovation is good, but it is easy to get distracted by something that is not really an opportunity. The modern expression for this is to “stay in your lane.” Evaluate each new “thing” you see as either an opportunity or a distraction. Ask yourself:

• Does this serve my current customers?
• Is this something I can easily add to what I am already doing or offering?
• How much will it cost to set this new thing up?
• How much time will it take? Do I have the time to dedicate to this task?
• Do I need to learn a lot more to make this work?

Remember when we said that entrepreneurs are “too busy” to grow? This is often why. They will get distracted by a “new thing” that may or may not fit in their niche, and instead of remaining focused on what they do and do well, they pursue a tangent that ends up being unprofitable, or worse something they can’t execute well. This results in the opposite of growth.

Take Care of Yourself

Finally, take care of yourself. Your business is you, and you are the heart of it. You can’t grow your business effectively if you are stressed out, strung out, low on energy, or even worse burned out. To grow your business you need to do some basic things.

• Take time off.
• Exercise and eat right.
• Take time for your personal relationships.
• Take vacations.
• Get enough sleep.

There are several items that could be added to this list. Essentially, if you don’t care for yourself, no one else will. There will also be no one to run your business, and it will not only stagnate and fail to grow, but it may even fail.

Want to grow your business and be a part of the growth entrepreneur world? Are you stuck without a plan to move forward? Follow these tips, take the time to evaluate where you are and where you want to go from here, and you can find your path to success.

Posted first on http://www.evolutionacceleration.com/

Marketing is the Most Important Focus of Startups....Think Again!

Author: Charlie Baldwin - Financial Analyst,

So, you have just taken the leap of faith. Started your own business. Bid adieu to the stability of a nine-to-five, health benefits, and a 401(k)-contribution program in pursuit of a dream you have held close for years. You know it will be an uphill battle and the odds are stacked against you. But there is a chance at a silver lining. A chance that five, ten, or fifteen years down the line, you will wake up every morning with sincere enthusiasm to get to work. A chance to build a vision-driven enterprise that brings your creativity and expertise into the world. A chance to grow a nest-egg that will provide generational wealth for you and your family for many years to come. Sure, most businesses go belly-up after only a few years, but yours is different. You have the ambition, determination, and willingness to push your business to succeed even in the face of extreme adversity. All you need is to get the word out there, and the snowball will start rolling on your path to prosperity.

Time to get real.

According to the Small Business Administration, 20% of businesses fail in the first year. Another 50% will fall after five years, and only about a third will survive to see their ten-year anniversary. But of course, you already knew this. The real question is ​why ​do most small businesses fail?

Chances are, if you quit your day job or otherwise have poured hours of time and resources into starting a business, you truly believe in your idea. And you should pat yourself on the back for this; it's truly a special gift in life to find something that you are so passionate about. Moreover, if you are putting many of your eggs in this basket, you’re almost certainly willing to spread the word: talking with neighbors, friends, family, and coworkers, not to mention advertising on websites and social media, ensuring that you’re getting your mission statement out there. Vision is at the core of most entrepreneurs, so they accordingly invest much of their time spreading that vision. It comes naturally as you want to share your enthusiasm with the people in your life.

Unfortunately, many entrepreneurs fail because they ​over-invest ​ their time into sales and marketing. Accompanying the expansion of platforms like Facebook, LinkedIn, and Instagram is an increasing desire for social capital and approval, especially among Millennials and Generation Z. True, you learn in business school that companies like Nike and McDonalds are able to deliver shareholder value through their brand. But these two juggernauts didn’t build billion-dollar brands by concentrating their efforts on how they were perceived by their peers. Instead, they disrupted stagnant industries by delivering products of undeniable value and driving growth from understanding their financial strategy from the inside out.

Phil Knight founded Blue Ribbon Sports (the predecessor to Nike) in 1964 after a formative travel experience in Japan. Knight understood that Japanese factories were able to manufacture the original Onitsuka Tiger running shoe at a cost so low it justified creating the shoes in Japan, shipping them across the Pacific, and selling them in the United States. When the partnership between Blue Ribbon and Onitsuka Tiger terminated in 1971, Knight was able to create the Nike brand running shoe and grow an empire. His key value driver wasn’t necessarily the shoe itself, but rather the supply chain that created considerable gross margins by lowering his cost of sales. In turn, Nike was able to bring much more of its sales down to the bottom line, which of course fared well with banks and investors. Moreover, Nike’s operational efficiencies created access to reliable cash flows that helped fuel its expansion.

Indeed, brand is still important to the development of a small business. It is by definition unique, and there is some tangible value in differentiation. But it is important not to become myopic around the idea of brand and marketing. At its central function, a business is in operation to make a profit. Some companies find auxiliary purposes to drive their operations, such as Patagonia’s mission to save the planet, but compelling as the idea may be, Patagonia won’t be able to save the planet if it doesn’t manage its finances properly. Even if Patagonia allocated 100% of its net profits from sustainable operations towards cleaning up the oceans, it wouldn’t be able to operate if it didn’t pay the rent at its retail locations, maintain the overhead expenses at its manufacturing facilities, or take care of Uncle Sam.

If you’re thinking about starting a business, or already have, I’ll leave you with a bit of advice. Hold onto your vision, your dream, your chance at a silver lining. It’s what will get you out of bed every morning and maintain your energy as you burn the midnight oil. Understand what is driving you, but don’t brush off the three things you need to maintain in order to get you there: the income statement, balance sheet, and most importantly the statement of cash flows. Sound financial strategy stems naturally from a comprehensive understanding of these statements and your overall financial vision. You’re probably doing more marketing than you realize, and the number one reason businesses fail in the United States is inadequate financial resource planning. Time is a finite resource, so if you’re spending much of it agonizing over the wording on a LinkedIn post for your business, maybe allocate some of that energy towards brainstorming ways to wholly improve your business operations and financial standing. Finance can be a daunting subject, especially when the picture isn’t pretty, or you lack the technical knowledge to understand it. That's why it is important to ask for help where you need it. There is an immense amount of resources at your disposal that can help you achieve your dream, which are invaluable in challenging times like these.

__________________________________________________________________________________

,The Astral Consulting Group

Posted first on http://www.evolutionacceleration.com/

The Impact of Growth Businesses on the Economy

Startups, defined as businesses in their first year of operation, have played a critical role in U.S. employment growth dynamics, and are an important factor in creating local jobs.

As a group, however, businesses that survive the start-up stage usually create more net jobs than start-ups. Studies show that the majority of sustained job growth in a community is generated by the expansion of existing businesses rather than start-ups or relocations of existing businesses to the community. It is the growing companies— business expansions—that have the greatest long-term economic impact on a local community or region.

A subset of growth-oriented entrepreneurs includes those who create break-out, high growth companies that expand rapidly in terms of revenues and job growth. These business establishments represent less than five percent of all businesses, yet create upwards of two-thirds of all business growth and job creation. Additionally, these entrepreneurs generate up to 50% of all innovation within our economy. High-growth companies, while extremely rare, are nevertheless found in most regions of the country, and in every county. Most fast-growing enterprises are not in high-tech industries; they are widely distributed across all industries.

Most rural areas have very few high-growth entrepreneurs, and have limited capacity to assist them. But chances are very good that these communities have a much larger pool of local entrepreneurs who want to grow, and do not know how. Helping growth oriented entrepreneurs create sustainable growth plans can dramatically impact the area’s overall economic development progress.

Some entrepreneurship support strategies such as Economic Gardening have chosen to target Stage 2 companies as the focus for their efforts. In their report on “The Significance of Second Stage,” Edward Lowe Foundation describes Stage 2 companies as those “that have grown past the startup stage but have not grown to maturity. They have enough employees to exceed the comfortable control span of one owner/CEO and benefit from adding professional managers, but they do not yet have a full-scale professional management team.” In terms of numbers, “employee numbers and revenue ranges vary by industry, but the population of firms with 10–100 employees and/or $750,000 to $50 million in receipts includes the vast majority of second-Stage companies.”

While Stage 2 growth-oriented companies do create a substantial number of new jobs, previous research has also shown that establishment growth (measured in terms of jobs or revenues) occurs among companies of all sizes. A more significant factor in firm growth is age of the firm rather than size. The younger companies are, the more jobs they create, regardless of their size.

In terms of developing community and economic development policies to support local entrepreneurs, the best target for small and rural communities is typically late Stage 1 or early Stage 2 companies that have the ability and desire to grow, and have a market (or potential market) outside the region or state. Some of these businesses may look like retail businesses, but they have opportunities to sell outside the local area (e.g., a pharmacy that discovered a niche in compounding and sells online in 48 states and several other countries). These late Stage 1 or early Stage 2 companies can fill the pipeline that will increase the numbers of late Stage 2 companies.

Community Strategies for Supporting Growth Businesses

The ‘sweet spot’ for most community entrepreneurship support programs is to target entrepreneurs who have started a venture that is between one and five years old and want to grow it, regardless of its size. These ventures aren’t necessarily “high-tech,” but they have developed some sort of innovation in their product, process or delivery method. They also have a potential or actual market outside the local economic region, and create quality, living-wage jobs.

Typically, these are late Stage 1 and early Stage 2 growth-oriented entrepreneurs. By providing support and help at this crucial phase, these entrepreneurs will be more likely to make good decisions that will allow them to remain viable and sustain their growth to reach the next level.

Finding these entrepreneurs is the tricky part. They may start out as a home-based business, or look like a secondary business such as a local retail or service business that is exploring an outside market through the Internet or franchising. A community must leverage its networks of existing entrepreneurs, small business professionals, and business organizations to locate appropriate target businesses.

Once a community has identified potential growth businesses, these key questions will help clarify whether an enterprise fits the bill:

1. Do they have a niche where they are competitive?
2. Are they committed to growth?
3. Are they actively exploring creating an external market footprint?
4. Are they “coachable” and willing to act on the information and advice they receive?

Entrepreneurship Support Strategies

Growth-oriented entrepreneurs have specific needs: access to capital—both human and financial; access to strategic coaching and technical assistance; access to appropriate facilities and high-quality infrastructure; a friendly tax and regulatory environment; market intelligence and access to external markets; and a trained workforce. They seek to create strategic alliances with other business owners and supply chain managers, and to develop the capacity to manage their enterprises successfully in a global marketplace. Communities can best support their growth-oriented entrepreneurs by addressing these needs.

Technical Capacity Building

Every growth-oriented entrepreneur has a set of issues that must be addressed to allow them to grow. Quality coaching services, such as the E-Coaching Program of the Center for Rural Entrepreneurship, helps GOEs connect to appropriate technical assistance resources—either in the community or accessible elsewhere—that can address their specific technical needs. The ability to develop a strong local referral network and to access appropriate professional business services in areas such as finance, legal, and accounting, is an essential part of doing business in any locality. Growth-oriented entrepreneurs typically want to connect with their peers to gain from their wisdom and experience, so strong local entrepreneur networks are also essential to the success of these entrepreneurs.

Capital Access

Recent reports indicate that the recession has slowed business activity and decreased demand for financing (e.g., less growth = less demand for financing). Conventional wisdom suggests that a lack of access to capital has produced the slower growth. But the challenge may be more complicated. Cash availability is at an all time high, and the cost of money is at an all time low. But fears about the economy, including the possibility of a longer recession and higher investment risk, have created a tighter capital supply market, and business planning requirements have become substantially higher.

Identifying available commercial lenders, micro enterprise programs, angel investors and government financing programs (e.g., SBA, USDA, CDBG, state) all become important to increasing capital access for growth entrepreneurs. Better market intelligence and scenario testing can reduce the risk for both capital providers and entrepreneurs who want to scale up their businesses.

Market Intelligence

Helping entrepreneurs create strong business plans is widely accepted as a good practice. However, business planning often suffers from inadequate or inaccurate market intelligence. This is particularly true for those entrepreneurs who want to reach external markets.

Market intelligence is a process that enables growth-oriented companies to access and use high-level technical expertise and strategic market information to explore new markets and growth strategies. It provides access to accurate, timely and actionable information gathered from primary and secondary research sources, as well as strategic advice from small business professionals. This is to enable an entrepreneur to ask better strategic questions, make more focused market decisions, avoid costly mistakes, and successfully grow his or her enterprise. Creating access to competitor research, customer profiles, market opportunities, suppliers, distribution channels, legal, pricing and branding information is all part of market intelligence support.

Market intelligence is critical to the development of a good business and capitalization plan. It also allows an entrepreneur to create new market scenarios and assess the risk involved, so that a new strategy can be tested in the marketplace. Market intelligence is a discipline practiced by all Fortune 500 companies; smaller growth-oriented companies also need to practice it to gain a competitive edge in their market space.

Infrastructure

The vast majority of entrepreneurs can live and grow their ventures anywhere. This is particularly true of growth entrepreneurs that create businesses with an external footprint. Physical infrastructure and quality-of-life considerations play strongly into an entrepreneur’s choice to stay or locate in a particular rural community.

Regional infrastructure issues—both physical and quality of life—are also fundamental to the success of local entrepreneurs. Physical infrastructure considerations include access to water, wastewater services, roads, power and telecommunications services, and adequate transportation logistics. In terms of quality of life, entrepreneurs want to live and raise their families in safe communities with good schools and higher education opportunities; quality housing; strong cultural and recreational amenities; vibrant local retail and service businesses; and accessible healthcare, child care, and elder care services.

The bottom line is that you can help your community grow by creating a strong community infrastructure and bringing together relevant technical resources to support your local growth-oriented entrepreneurs. In a rural community, community development and economic development are two sides of the same coin, and both are needed to help a community create new hope, increase wealth and expand choices.

Source:

Posted first on http://www.evolutionacceleration.com/

How Young Entrepreneurs Position Themselves Tactfully in the Marketplace

In an increasingly volatile economic climate, it is imperative that young entrepreneurs position themselves tactfully in the marketplace, and avoid frivolous spending.

Such expenditures dampen a firm’s ability to grow and spread its core message, forcing budding companies to take on a significant debt burden, or markedly diluting their ownership stake. Without a deep understanding of their firms’ capital structure and broader financial strategy, these young executives expose themselves to extraneous expenses which are both unnecessary and unsustainable when attempting to scale. Today more than ever, many ambitious business owners find themselves lacking the critical financial knowledge and understanding to make strategic high-level financial decisions, both to grow their sales and to secure capital funding. To evolve into a leaner, more streamlined operation, these growing companies must first identify the key drivers most essential to their business; this process starts with broad, yet nuanced, understanding of their company’s financials and capital structure.

After graduating from Lehigh University, I, Christopher Andrassy, along with fellow alumnus Alfonso Alburquerque, founded The Astral Consulting Group LLC with the aforementioned problems in mind. Our vision starts with growing businesses and their ambitious leaders poised to disrupt their respective industries. As a startup ourselves, we have a unique perspective of the most pressing issues afflicting entrepreneurs and their companies. We have worked with growing companies across a myriad of industries, from commercial manufacturing to fintech, and grown accustomed to lasthe unique challenges facing each new venture. Financial strategy stands as the most critical facet of running a business in terms of efficient cost management and fundraising. Access to capital funding, and the business acumen to optimize capital structure, striking the most efficient balance of debt and equity funding, is also crucial.

My business partner and I both hold degrees in analytical finance and mechanical engineering. We were both members of the Integrated Business and Engineering honors program at Lehigh University, where we had the opportunity to work alongside startups to grow their businesses and to pitch angel investors. In addition, we have worked at two leading consulting firms in both technology and financial M&A consulting. We also have technical expertise from working in mechanical engineering and supply chain management. We bring a broad skill set of both deep analytical understanding and knowledge of the operations and financial strategy of businesses. At our firm, we work closely with our clients to assist them with a multitude of financial and data-driven projects; these range from performing company valuations to creating strategic financial dashboards that effortlessly give entrepreneurs the high-level insights they need to make critical decisions.

With the guidance of the entrepreneurs and experienced business leaders we have met thus far in our journey, we have quickly grown to providing value to growing businesses in many ways. Our core business is financial modeling, valuations, and creating elegant dashboards and analyses that streamline complex financial projections and metrics into actionable, digestible, takeaways. However, we also work closely with clients to tailor our solutions directly to their unique needs, and as such do not use a cookie cutter approach. These projects often include data-driven work, including financial app development and data manipulation. Recently, we finished an engagement for a fledgling startup that is revolutionizing the tooth fairy experience for kids across the United States. To help their CEO, Shannon, with pushing into the second round of fundraising, we revamped her current financial projections to create an efficient, intuitive model which allowed her to understand and analyze her key business drivers. In addition, we helped prepare her fundraising pitch by breaking down various funding scenarios in our financial forecasts and company valuations. As all financial projections are inherently inaccurate to some degree, we work to build flexibility into our analysis to accommodate the inevitable uncertainties and challenges which lie ahead. For Shannon, this meant understanding the breakdown of her capital structure, analyzing her new marketing channel’s P/L implications, and gearing up for pitching to investors. Armed with a deep understanding of her financials, she is well on her way to securing the funding she needs to permanently transform the magical experience of losing teeth as a child. We look forward to working with her in a second phase shortly, working to enhance her inventory management with a data analytics procedure, and to strategically advise her financial decisions.

Please feel free to reach out to us to discuss our portfolio of work, network of clients and angel investors, or just to bounce some ideas off one another!

Check out our website:

Posted first on http://www.evolutionacceleration.com/

Understanding Your Buyer Journey – 4 Ways This Helps to Build Your Business

Do you understand your buyer journey (the steps a prospective buyer takes when considering purchasing your products or services)? Whether you operate a brick and mortar business or if you’ve been in business for a while, there’s a good chance that you already have a strong understanding of what drives customers to your business. This blog post is designed to help you to take this knowledge and apply it to your website and digital presence so that you can attract and engage prospective clients earlier and throughout your buyer journey.

What is the Buyer Journey?

The buyer journey can be described as the different stages that a buyer takes to purchase a product or service. Buyer preferences might differ depending on the customer, but the buyer’s journey takes on the same overall process following the steps outlined below:

Buyer Journey Stages

1. Research: This is the initial stage of the buyer journey, sparked from a general interest or desire. Buyers in this stage will gather as much information as possible about the need they have and research different solutions. 

2. Evaluation: The second stage of the buyer journey has the customer seeking potential options around specific products and services. At this stage, they might begin to consider different suppliers to compare which might be the best option for them. 

3. Engagement: Engagement comes when the customer makes a decision to purchase the product or service (hopefully from you!). 

4. Repeat Business: If the product or services they purchase meet or exceed expectations, they may become interested in either re-purchasing or expanding their use of the different goods or services on offer. 

Where does digital marketing come into play with the Buyer Journey?

Increased reliance on Google search, online reviews,  testimonials and social media provide opportunities for businesses to increase their visibility and get noticed during each stage of the journey. 

Before we dig deeper into this topic, you’ll notice an underlying theme present at each stage. Search Engine Optimization (SEO), lets businesses generate traffic to their website through organic search results.

When looking at SEO from the perspective of the buyer journey, the objective is not only to generate clicks but attract targeted, high-quality traffic to the site at the right time i.e. as early in the buying cycle as possible. 

Strategies for Getting Discovered during the Research Phase of the Buyer Journey

Creating content during the research phase can entice customers to visit your website. 

• Deepen their journey further with your business by delivering blog posts and content that will assist them during the research stage of their journey. 
• Think about the questions a buyer might ask if they were to research products and services and answer these in the content on your site. 
• Think back to their problem and illustrate how your products and services are the best possible solution to meet their needs.
• Well optimized products and services pages, blog posts and an FAQ section can answer research questions in a clear and concise way. 
• You can also capture prospects early in the research stage by using pop-ups or email sign-up forms, offering incentives for those who subscribe to your list. This helps you develop a lead funnel to help guide customers through evaluation and engagement.

Ensure that your site content is organized with relevant, keyword-optimized headers and text delivered in readable sections. The right keywords must also be included in the title tags and page URLs, where possible and especially in the text. 

Remember to add a meta-description that highlights these keywords while presenting enticing messaging that encourages people to click, too.

Standing out From the Competition: How to Stand out During the Evaluation Phase of the Buyer Journey

Customers might find the content you provide during the research phase useful. But you should assume that you are not the only business in the running! Getting and staying ahead of the competition during the evaluation phase of the buyer journey can be done through paid ads, content relevance and testimonials:

1. Google Ads – Businesses can appear at the top of Google Search Results, especially when bidding for keywords that visitors might use during the evaluation phase. Conduct a keyword research and bid on local/long tail keywords that yield good monthly searches but have medium to low competition (to keep costs low). When considering your keywords think of words that are often used by customers when evaluating their options.

2. Google My Business – Having a Google My Business (GMB) listing is a quick and easy way to show up right at the top of the search engine results pages. This is especially true when people search for the name of your business. GMB makes it easy for them to find your site and location. If you haven’t done so yet, claim your Google My Business listing! Ensure the best possible engagement with your audience by completing your profile thoroughly. It is also good practice to provide up-to-date information like business hours and links to Google Maps and Google Ads. 

Google My Business is also one of the easiest ways to collect reviews. Not every customer will give you a glowing review but when they do, having a standard response protocol to this type of feedback is crucial. If prospects view your listing and it has lots of great reviews, they’re more likely to choose you over the competition.

3. Your Website Content – Consistency and quality are key! Your website should use the same keywords that you use on your Google Ads copy and Google My Business. Answer questions people are asking when evaluating their options in your content, blog and FAQ sections. Don’t forget to optimize those pages well.

4. Link Building – Link building is the process of getting other websites to link back to your website. It can also help your website appear higher in the search results (if you do it right). The more links you have from high-quality sites, the better. But it’s important to mention – these links must be in your local area or related to your industry. It’s worthwhile to list your site on supplier pages, local directories or industry associations. These are good places where you can showcase your business. Not only is it a great way to build social currency, but it is also an incredible strategy to boost your website’s SEO and help your site rank higher. 

5. Testimonials – Knowing that other customers have had a great experience with your company, products and services, is a great way to encourage new customers to support you. Testimonials, case studies and reviews should be front and centre on your site in the key places people are looking – i.e. on the home page, product or services pages. You may even wish to include a dedicated page on your site for these.

Seal the Deal: How to Convert Your Customers during the Engagement Phase of the Buyer’s Journey

So your customers have chosen you over the competition. Hooray! Now what?

• Give prospects detailed information on warranties, returns, shipping, ordering and your ordering processes and make sure this info is easy to find on your website. 
• Seal the deal by having strong call-to-actions on your site and keep indecisive customers engaged with your business by setting up an automated abandoned cart email. 
• It is important to provide a seamless experience between further research and the check-out or sign up process during the engagement stage of the buyer’s journey. 
• If your website allows for a chat function (which is a fabulous way to get visitors to engage), remember to provide swift and courteous follow-ups. 
• Your contact page should list all of your pertinent contact information along with a simple form to guide customers through the engagement stage of the buyer’s journey. Include click to call options and your email address on the page too to make it easy for them.

Turning New Customers into Life-Long Clients: Creating Repeat Business in the Buyer’s Journey

The customer journey doesn’t end after the transaction. Building repeat customers adds immense value to your bottom line. It’s much easier to keep a customer than it is to get a new one!

Even a 5% increase in customer retention can produce more than 25% increase in profit. The cost of retaining customers is also more effective than attracting new ones (though both efforts should be practiced!). 

• Generating repeat business can be as simple as providing great follow-ups and customer service after the sale.
• You can also build loyalty and engagement through other channels like social media and Google My Business or Bing local too .
• Don’t forget to add recent customers to your newsletter lists to provide regular updates (be careful to comply to the spam legislation in your area.
• Offering referral incentives is a great way to expand your client base further. It also increases the chance of retaining these customers as repeat business. 

Your Buyer Journey – Conclusion

Your business may already be practicing some (or all!) of these strategies. With a deeper understanding of the buyer’s journey, we hope you have even more insights to refine your approach. 

According to a study conducted by Oberlo, approximately 1.8 billion people worldwide, purchase goods and services online. This is projected to grow up to $4.8 trillion by 2021. It’s essential to understand how digital marketing can help customers find and engage with you online throughout their buyer’s journey. 

Source:

Posted first on http://www.evolutionacceleration.com/

How do you know if your good idea is the next big thing? (Part 2)

,Before you design a solution, you need to know what problem you are trying to solve. I often have students who want to create startup ideas that solve a personal problem. One of my students wanted a better way to share music. Another wanted to create a way to earn Boy Scout merit badges online.

,However, each of these students needs to define the problem space to determine whether their solutions—online education and peer-to-peer recommendations—were really a problem for other people. In other words, is this problem a pain point for just you or are there others? Is there a real problem with a large enough market that needs a solution? To define the problem space, we need to start with a more expansive view of what we are dealing with to determine what might be the best solution.

Remember the three questions we asked in

1. Feasibility: Can we do this?
2. Viability: Should we do this?
3. Desirability: Do they want this?

,At this point in the process, we are trying to answer the desirability question…Do they want this? So we have to define who is the “they” in this question, and then brainstorm to discover the “this” or solution in the question we want to test. We can use human-centered design to experiment and match our solutions to customer needs at the sweet spot in the center of feasibility, viability, and desirability,.

WORKING THE PROBLEM SPACE

So let’s say you are trying to develop concierge college admissions services. That’s the business you want to create. But what is the problem you are trying to solve? Often, students jump to a solution before diving deeply into understanding the problem space. Who is experiencing pain? Is it painful enough that people are seeking solutions and willing to shell out money?

Stanford University’s D-School has developed exercises for brainstorming and developing ideas. LUMA Institute and IDEO.org are two additional companies that help organizations think more expansively and deliver ideas that meet human needs.

Stakeholder Mapping

To visualize who is impacted by the problem you are trying to solve, you can use a stakeholder map to get a sense of the problem space, the actors in it, and who your solutions might address.

For example, students in a social media class were attempting to create tools and strategies to reach out to potential undergraduate students for college admissions. Of course, they started with the pain points and perspective of high school students having recently been in the search for colleges themselves. However, by identifying other stakeholders that play a role in the admissions process, the students were able to identify other pain points and possible solutions that addressed parents, admission counselors, and other stakeholders in the map (Figure 6).

To begin, you need stickies and limited drawing ability. Also a large blank canvas of paper.

• Create small teams of two to six people. Each person in the team gets sticky notes and a marker.
• Independently, team members are invited to brainstorm potential stakeholders in the problem space. In our example above, we went beyond the college organization to look at the role of parents, high school counselors, government agencies, and others play in the college decision process. Individual work should be given about one minute.
• Collectively, the team goes through its stakeholders, identifying commonalities and defining the roles more clearly by adding a visual element or a speech bubble to suggest what the person may be saying or thinking. These stakeholder stickies are put up on the blank canvas by consensus of the group.
• Organize the stakeholders by grouping entities that are linked by geography or processes. Use lines to draw relationships between stakeholders. For example, a line between parents and the financial aid office of a college might be drawn with dollar signs on it.
• Discuss in the group where there are breakdowns, pain points, and other places where innovation might help to solve the problem. These discussions can then be used to refine who the customer might be for your efforts — students, parents, college administrators, etc. — and who will pay for your solution.
• Select the stakeholders that you will continue to ideate around as potential customers.

Statement Starters

One exercise, found at LUMA Institute, is designed to ask “What if?” types of questions: open-ended questions that become the jumping point for brainstorming. Sample statement starters include: What if_____? or How might we_____? These statement starters are then attached to the problems you’ve identified in your stakeholder mapping exercise. Brainstorming then happens around the problem you’ve identified.

IDEO has a design kit with many examples.

OTHER TOOLS YOU CAN USE

• IDEO’s Design Kit resource
• Check out this collection of
• LUMA offers an
• Exploring your hunch
• The
• Help students to prioritize, communicate, and strategize using this
• Try these

VALIDATED LEARNING

Eric Ries of The Lean Startup advocates “failing fast.” What he’s suggesting is that teams quickly move through the ideation stage to customer discovery and testing phases, tossing out assumptions and ideas that fail to meet customer needs.

IDEAS → BUILD (CODE) → MEASURE (DATA) →LEARN

You and your team will engage in a process of validated learning…confirming your assumptions through user testing, research, interviews, or ethnography. You may also build test sites or “smoke tests”—fake websites that walk users through the solution to see if they will pull out their wallet and buy (but don’t use your real domain name for these tests). You may pivot or change ideas after getting feedback or may find yourself back at the empathy stage, gathering more information about the problem space before creating new solutions. The idea is to stay lean and iterate quickly through ideas: build, measure, and learn.

With validated learning, you can test your value hypothesis — the value proposition that you are offering to your customers — or your growth hypothesis, how you intend to scale your company by testing new markets, or types of users. A hypothesis template looks like this:

We believe that ______ will cause [the users] to [do this action/behavior] because of [value proposition].

An example might be:

We believe that an augmented reality shopping app will cause brick-and-mortar shoppers to walk into stores more frequently because of the urgency and proximity of the deals and discounted offers.

Hypotheses are tested using the traditional research methodologies and a prototype or minimum viable product (MVP) of your idea. A prototype is a reduced version of your actual product or service, featuring just key features or functions. Version One of your product has every feature and function that users might need. A prototype can be developed in a few hours or days, while your first full version may take months.

Your team will define the hypothesis, determine how you will test the hypothesis, and assess what you learned from the results. Developers use A/B testing to try two different solutions and see which one gets the best response. This testing might be two different designs of a home page, testing color schemes or even two different solutions.

Before you spend valuable time and money rolling out a product that no one needs, a prototype and idea testing can help refine your ideas and discard or enhance your product or service features.

,SWOT ANALYSIS

Once you have identified the problem your group intends to solve, you must ask if another product already addresses it. If so, how? Conduct a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis from the point of view of the competition. (

Links to articles that describe brainstorming, ideation, and design thinking.

• The Creativity Imperative in the Innovation and Entrepreneurship Curriculum: A Dilemma in the Scholarship of Teaching
• Fostering Creativity – a Holistic Framework for Teaching Creativity
• A Taxonomy of Innovation
• The 7 All-Time Greatest Ideation Techniques
• A Guide to Journalism and Design
• Introduction to the Essential Ideation Techniques which are the Heart of Design Thinking
• 10 Longtime Brainstorming Techniques that Still Work
• 6 Types of Brainstorms that Help Create Awesome Ideas
• Ideation – Learn More About Your Innate Talents from Gallup’s Clifton StrengthsFinder!

Source:

Posted first on http://www.evolutionacceleration.com/