Experiencing a «startup» or your first «bread and butter» job is very different from what is experienced in a more mature career or ongoing business concern. I received an online request for help recently. A teenager said they were launching a computer repair/Internet Security business.
They had limited capital and needed advice about how best to spend it. I suggested that since they apparently had the «brick and mortar» aspect of their business well in hand, they consider a very simple step into the online world. Despite some initial grumbling about not planning to deal with mail order shipments, they sat down and listened to how I might transform a My Space page, which each member of the group had, from what I call a «seed» phase to into a real, rubber-hits-the-road «startup» business tool. Though expectations, confidence and stress levels were different for these young entrepreneurs, their use of key management tools and action plans are fundamentally the same as they are for every business person hence my suggested approach is fairly easy to generalize to any startup situation.
Let me provide one example of how a business plan is used as a management tool. Most people describe their business in terms of a process; work in one functional area flows into another which in turn flows into yet another. The three young men in front of me, like many, were only, at this stage in their business plan, able to offer free advice based on their collective areas of expertise. They talked of service-related goals but unfortunately, the only distinguishing characteristic their joint venture could offer at the moment was their collective core competencies in computer repairs and Internet security. I suggested that they take a step back from their youthful enthusiasm and focus on identifying their product/service «niche» and how their might «brand» it as their own. Given a highly competitive marketplace and little credibility because (1) they were in a «startup» phase, (2) they had no previous history relevant to their «mission plan» and, (3) outside economic forces are less than favorable these days, an owner/manager might concentrate on a marketing plan even if it meant postponing a business launch date. I told them they needed to make decisions based on objective needs rather than emotional wants. The most alpha-male of the group began fidgeting. Knowing attention spans were growing short, I sat between the three them with my yellow pad and wrote down the following four points:
o Choose a product/service to sell – The What
o Identify customers/clients that can buy – The Who
o List reasons for customers to buy – The Why
o Follow up with customers that do buy – The How
It was clear to all in the group that «The What» (computer repair/Internet Security) and «The Who» (computer users/owners) were already identified. It immediately became apparent that, in their enthusiasm, they had overlooked «The Why». Most people do because of their own belief in themselves and in what they believe is the quality of their offering. They fail to step back and look at their project objectively; an unproven product/service, an unproven provider, and no credible history. I added a new perspective to their thinking here. In listing reasons why a customer should buy their product/services, they needed to carefully examine the successes of their existing competition and create a brand that was distinguishable from them. They needed to market their version of «The Why» in an identifiable and memorable manner that would separate them from the rest of the competition. The alpha-male’s eyes suddenly lit up with understanding. He now saw how the follow up with customers not only strengthens a service relationship but feeds back into «The Why» people purchase the product/services. I added that the feedback was more than just a testimonial but was actually valuable market research that might provide, for example, a key reason that persuaded a customer to buy the product. The follow up was also good customer service since a «post sale» interview offered some evidence of long-term customer care.
People need time to digest new ideas. The group of young men was clearly energized by the four point explanation. They understood that they needed to create a marketing plan that identified their own core competencies specifically in relation to the expertise of other competitors in their niche marketplace. They then needed to formulate a brand name or mark that somehow distinguished them from the «herd». Once those objectives were met, they would need to put «wheels» on their market plan, but that discussion would happen on yet another day…