Spend Time Discovering The Right Marketing Strategy Instead Of Spending Money Validating The Wrong Plan

BusinessModel

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Do you know how so many startups (new businesses or executives building new business divisions) set out to tackle the market with a comprehensive business plan that they’ve poured hours, days, if not weeks into building that 50 page document but have never spoken to one single customer they plan to market to?  Well, unfortunately this is the norm that for the most part ends in either complete business failure or a complete shift in the business model once customers get involved.

When the startup finally does get to market with their finely tunned financial performa and beautifully baked product, the end result is mostly spending a lot more time and money to figure out what does not work in their business plan.  More importantly, the business still has few if any revenue generating customers and is now in a higher risk situation than it began in.

As a marketer and advisor to several businesses, I am constantly looking for more efficient ways to help the entrepreneurs I work with to be more effective marketing their products and services to the right customers.  So what’s the best and most efficient way?  I wish I knew the answer years ago but, here’s what I know now.

Talk To People

I know, duh?  Well, why aren’t we doing it?  Because everyone has always told us that you need to write a business plan.

Unfortunetly, most business plans are just detailed assumptions about current reality of a known and well researched market.  By the time a real business model is discovered most business plans will have gone through multiple iterations and look nothing like its original.

Instead of spending time crafting that glorious plan, spend more time identifying why you are creating the company 1st and identify the problems or opportunities that exist by talking to customers.  By spending time talking to real world customers you will begin to really understand their true pain points and uncover new opportunities that you did not think about.  But, how exactly should you be talking to the customers and what should you be looking for?

Look For Patterns & Take Notes

Recently, I’ve been working with small business owner who runs a flower shop and she is looking for a way to be really different.  So, we’ve come up with a few ideas to test.

During the course of talking to a specific segment of customers — “men” ages 35 – 65 — we have learned that 1) they really procrastinate when gift shopping 2) they want to be reminded when they need to get a gift and 3) they’d love to have some options to choose from.  Otherwise, they’ll wait until the last minute and run to a store hurried, pace around and pick out a blender or ThighMaster and end up in the proverbial doghouse like these guys.

Now that you’ve had a laugh, how would you help these guys?

Well, because Shelly and I discovered a pattern she is making email marketing part of her regular business practice that serves as reminders with gift ideas.  Further, she is also considering creating a concierge service catered to men that helps them identify the important people in their lives that they don’t want to forget; have pre-planned gift purchases set-up to be delivered to them with recommended ideas of what they could get; plus have access to a gift consultant to talk with to make sure they stay out of the doghouse.  Doesn’t that sound cool guys?

If you really think so express your thoughts in the comments or contact me directly – I’d like to hear what you’d pay for this service and how you’d want to interact with it.  We’re trying to see if she can really build a business model off this idea by documenting what we learn and testing pricing, messaging channels, and means of service delivery and several other criteria according to business model generation practices.

It’s important to note that Shelly bought her business from another business owner that wanted out.  She’d always wanted a flower shop and began with a developing a business plan but her plan has not seemed to work.  Now, we are trying to figure out with real customers how to build a better business model.

Start Discovering A Model – Don’t Build A Plan

Unfortunately, I’ve had to learn this the hard way.  I’ve created those masterful 50 page plans with data to no end that makes the performa seem like child’s play.  However, customers in the market are more important to spend time with and learning from.  They’ll tell you how to sell them your widget but, the widget you plan to sell most likely may not be what they want until you ask them.

With several startups I’m involved with we have embraced lean startup and customer development this past year.  Beginning at a very high level, we are organizing our thoughts and assumptions first into one page business models { check out Lean Canvas for a guide }.  Then, we start talking to folks about why we’d like to do what we want to do and how we think we can achieve it all with the understanding that we need to learn from the customer in order to develop a business model and a plan.

About Jason Cronkhite

Entrepreneur, Fanatical Football Supporter, Husband & Father to two cute kids Kendall & Connor.