Learn how successful entrepreneurs beat the odds and stay in business.
Nearly six out of 10 new businesses fail before their fifth year. If you’ve launched a business or are thinking about it, the odds of long-term success are against you! How do the survivors successfully find, attract and keep good customers? What’s their secret? Could it be their passion for their business?
There are several ingredients that go into a winning business, including a great idea, a great team, great passion, and great leadership. All are important, but great passion can be the fire that helps fuel the success. It can also destroy the business when it is misguided.
Like all fires, passion can spark other flames and become contagious, igniting the passion of investors, business partners, and customers, as well as employees. If left uncontrolled, passion can consume, destroy, and leave a business with an empty dream. However, when controlled, directed, and focused, it can boost a business’s chance for success. Nonetheless it isn’t the only important ingredient. A great business idea alone will not make a business profitable, but a passionate team that has the vision and the ability to execute the idea, even if the idea is only pretty good; can help a company achieve success.
Therefore, in order to be successful in business, you don’t have to come up with the most ingenious and creative business concept. However, you must have a solid concept that satisfies a need, and you must be able to properly funnel your passion to execute the plan. The failure to fuel your passion can cause you to skip or dismiss basic business principles. In fact, that’s where you see really smart businesspeople with good intentions make fatal errors in judgment.
Passion can also be misdirected when you’re caught up in the day-to-day activities of your business and don’t take the opportunity to sit back and think about how to focus your energy. Joanna Alberti’s business, philoSophie’s® (www.sophiesphilosophies.com), is a good example of the importance of taking time to reflect on your business goals and where you want to direct your passion. PhiloSophie’s is a successful start-up greeting card company launched by owner and entrepreneur Joanna Alberti. In 2005, at the age of 24, Joanna was recognized by BusinessWeek as one of the top five young entrepreneurs under 25. Known for her whimsical designs and her humorous illustrations depicting women and their interests, Joanna’s style and creativity fueled her passion to launch a greeting card business just one year after receiving her college degree.
As a business mentor to Joanna, I had the opportunity to work with her as she developed philoSophie’s. I also watched her struggle as she worked 20-hour days; often coming into my office covered in glitter from the greeting cards she had hand-embellished. She was doing it all, but was she doing too much?
Joanna was trying to launch her business in so many venues that she was not taking the time to determine who her customers were, why they were buying from her, and what needs she satisfied. She was trying to get into as many markets as possible without thinking about which of them made the most sense for her limited budget and time. She was clearly spread too thin and was unable to prioritize her marketing efforts.
Most business owners, like Joanna are so busy with the day-to-day management of their company that they don’t realize the importance of focusing their business passion to reach their goals more rapidly, more efficiently, and with greater overall success. The following is a list of marketing techniques that I helped Joanna implement and always recommend to my students and clients. They are designed to ensure your passion fuels your success, not your demise.
1. Profile Your Customers. Who are your most valuable customers? Can you describe them succinctly, in 50 words or less? Profiles are descriptions of your customers’ values, beliefs and decision-making processes. While it’s important that you understand the products and services that you offer customers, it’s even more significant to understand what your customers value and why so you can fulfill their needs. Don’t assume you know, ask them.
2. Play 20 Questions With Your Clients. Imagine that your five most important customers are sitting in a room with you. What questions would you ask them about their purchases, their needs and interests, and the factors that influence their decision-making processes? Hopefully you already know how they found your company, what they have purchased, and why. If you don’t, these should be among the first questions you ask. Compile a list of 20 questions that will help you define your customers. Then develop a framework that will allow you to obtain critical information, determine the methods you will use (i.e., surveys, market research,) and define sources of this data.
3. Remember to Keep Your Friends Close but Your Enemies (i.e., Competitors) Closer. Identify several companies that offer competitive or substitute products or services. Discover what their benefits are to potential or current customers of yours. Now think about how you compete against them by comparing your message, value proposition and target audiences with theirs. Based on your assessment, develop at least three strategies that you will use to position yourself effectively against them and are prepared with this knowledge when prospects ask, “What sets you apart from ABC Company?”
4. Identify Partner Companies That Will Create Win-Win Relationships. What do you expect from a partner and how can it contribute to your company’s growth? Can your potential partners’ strengths be leveraged to empower your business? What does your ‘must have’ list look like in order for your partnership to succeed? Do you each add value to mutual companies while not competing with each other? A strong marketing alliance offers many benefits, including reducing risk, sharing costs and improving time to market, so choose your partners carefully.
5. Find Out If Perception Is Reality. How do your customers and prospects perceive you? Branding is the impression you leave through every customer touch point and involves far more than a nice logo or cool tagline. Everything you do has to incorporate your message, because if you dilute it in any way, you won’t be sending a clear definition of the value you provide customers. As the saying goes, “Perception is reality,” so in order to ensure that your brand is strong, your message must be clear, focused and on target at every touch point.
6. Prepare a Strong Elevator Pitch. Ever find yourself in a room with a key prospect and you couldn’t succinctly explain your business to her? Perhaps you rambled on for minutes, never getting to the point, or you froze up. Elevator pitches are designed to help you prepare a very brief pitch explaining clearly to anybody you meet why they would want to continue a dialogue with you at a future point in time. You don’t want to tell them everything about your business, just enough to whet their appetite and get them interested in meeting with you again.
7. Align Marketing Programs to Meet Sales Goals. Sales and marketing have to work together to support business growth. Even if the same person wears the sales and marketing hats in your company, you must plan your marketing program based on how many sales leads you need to generate and what your cycle time is. For example, if you know you need 1,000 leads over a six-month period of time to attain the number of new customers required for business growth, proactively plan your marketing programs well in advance so they generate the desired results.
8. Harness Your Passion as a Strategy. Even the most successful companies have their share of business ups and downs. How will you use your passion to get through the rough patches and continue to grow? Consider your passion for your business. What do you love about it? Why are you starting or did you start it? List 10 reasons why you feel passionately about your business. Post this in your office or some place where you will see it every day to remind yourself why you’re getting up each morning and going to work (even if that’s just down the hall). These 10 reasons will keep you motivated on the good days as well as the bad ones!
Implementing many of these techniques allowed Joanna to candidly evaluate the effectiveness of her strategy for expanding philoSophie’s and to successfully channel her passion in the optimal direction. Through hard work she identified her most valuable sales channels and developed more efficient ways of allocating her time, ultimately leading to critical growth in both new and existing markets.
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Beth Goldstein is President of Marketing Edge Consulting Group, LLC (www.m-edge.com). She has over 22 years experience in sales and marketing and is the author of “The Ultimate Small Business Marketing Toolkit.” She oversees Boston University’s nationally recognized Online Graduate Certificate in Entrepreneurship program, teaches entrepreneurial marketing at the BU School of Management and is the instructor for the InnerCity Entrepreneurs business growth program in central Massachusetts. Beth can be reached at email@example.com