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Entrepreneurs know that there comes a time in every startup's life when growth seems to plateau. No matter when that happens, at $400,000 or $20 million in sales, there are proven ways to break the barrier, Patrick Thean told attendees at the ComdexVirtual event this week. Thean, a serial entrepreneur who has started and exited multiple startups, offered advice on selling more product and earning more money by zeroing in on three key concepts: differentiating for core customers, executing your business strategy, and using guarantees to win more business.
How To Differentiate for Core Customers
IT solution providers need to offer products and services that "Wow" their core customers – those 20 percent of clients that provide 80 percent of revenue. Consider making changes for your core customers only. As an example, Thean cited Southwest Airlines. Southwest has a unique model. It offers low fares that attract core customers -- people who might otherwise ride the bus.
The catch is that in order to obtain a preferred seat, passengers must arrive early and wait on a line, just as they would at a bus depot. Potential customers who are chronically late and have hard and fast seating requirements would have their complaints about Southwest's procedures fall pretty much on deaf ears -- those people do not make up this airline's core customer base.
Identifying who exactly the core is, is crucial. "The core customer is a person, not a category," said Thean. Once the core is identified, focus on that group's needs, not wants. Needs are must haves; in a recession, a customer will pay for needs, not wants. It's similar to the difference between wanting vitamins but needing medicine, Thean explained. That's where brand promise comes in.
"At the tip of the iceberg is brand promise," he said, which includes marketing and sales. "Below the water line are activities and measuring. Brand promise is what everyone sees, but if you do a bad job fulfilling on your brand promise, you can lose your core customer. You don't want your brand promise to become just a tagline. Taglines don't differentiate you."
How then, can an IT solution provider build something different and make their businesses remarkable? Thean recommended Hide a Dagger Behind a Smile, written by Kaihan Krippendorf. Basically, the author notes that grand chess masters have 10,000 moves compared to the average player, who has about 1,000. Grand masters win because they have more patterns memorized that they can use readily. Thean offered three patterns that many entrepreneurs have not thought about:
1. What is the competition not willing to do? In the case of Southwest, the competition was not willing to give up standard boarding procedures. By not following those procedures, Southwest gets more airplanes off the runway.
2. What do customers hate? They hate when a service doesn't go as expected. Thean gave an example of a hosting company that pays customers if their sites don't migrate properly.
3. Figure out if your company has an inherent asset built into its DNA.
Next: Executing Your Business Strategy
