Why you need early adopters and why you only need the most basic product to start a business5/8/2013
We had a working engine of growth. The gross numbers were small because we were selling the product to visionary early customers called early adopters. Before new products can be sold successfully to the mass market, they have to be sold to early adopters. These people are a special breed of customer. They accept—in fact prefer—an 80 percent solution; you don’t need a perfect solution to capture their interest.
Early adopters use their imagination to fill in what a product is missing. They prefer that state of affairs, because what they care about above all is being the first to use or adopt a new product or technology. In consumer products, it’s often the thrill of being the first one on the block to show off a new basketball shoe, music player, or cool phone. In enterprise products, it’s often about gaining a competitive advantage by taking a risk with something new that competitors don’t have yet. Early adopters are suspicious of something that is too polished: if it’s ready for everyone to adopt, how much advantage can one get by being early? As a result, additional features or polish beyond what early adopters demand is form of wasted resources and time. This is a hard truth for many entrepreneurs to accept. After all, the vision entrepreneurs keep in their heads is of a high-quality mainstream product that will change the world, not one used by a small niche of people who are willing to give it a shot before it’s ready. That world-changing product is polished, slick, and ready for prime time. It wins awards at trade shows and, most of all, is something you can proudly show Mom and Dad. An early, buggy, incomplete product feels like an unacceptable compromise. Minimum viable products range in complexity from extremely simple smoke tests (little more than an advertisement) to actual early prototypes complete with problems and missing features. Deciding exactly how complex an MVP needs to be cannot be done formulaically. It requires judgment. The lesson of the MVP is that any additional work beyond what was required to start learning is waste, no matter how important it might have seemed at the time. The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses by Eric Ries The goal of such early contact with customers is not to gain definitive answers. Instead, it is to clarify at a basic, coarse level that we understand our potential customer and what problems they have. With that understanding, we can craft a customer archetype, a brief document that seeks to humanize the proposed target customer. This archetype is an essential guide for product development and ensures that the daily prioritization decisions that every product team must make are aligned with the customer to whom the company aims to appeal.
No amount of design can anticipate the many complexities of bringing a product to life in the real world. The problem with most entrepreneurs’ plans is generally not that they don’t follow sound strategic principles but that the facts upon which they are based are wrong. Unfortunately, most of these errors cannot be detected at the whiteboard because they depend on the subtle interactions between products and customers. The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses by Eric Ries But you should think of fear as an acronym: Forget Everything About Reality.
The truth is you can seldom predict what will happen when you embark on a new path. No matter how many scenarios you envision, chances are things won’t go as well as hoped for or as poorly as feared. The question is: Do you want to exclusively consume the creations of others, or will you dare to become a creator? Internet Prophets: The World's Leading Experts Reveal How to Profit Online by Steve Olsher Mike did everything in his power to build wealth while freeing up time to enjoy it. He developed a powerful mantra upon which he bases his career and lifestyle choices. In a word, his philosophy can be summed up as F.A.S.T.: • F = Fun: Without fun and excitement, work quickly becomes stale. People tend to spend more time at work than anywhere else. Mike insists on creating not only profitable endeavors, but also an environment where both he and his employees relish working because it gives them satisfaction, fulfillment, contentment, and happiness. • A = Automation: Technology has made it much easier to create products and deliver them to customers. Mike is a huge proponent of taking full advantage of available tools, ranging from automated webinars and teleseminars to pre-loaded social media messages and press releases. If your business isn’t structured to churn cash while you sleep, you’re doing yourself and your company a disservice. • S = Scalability: You want to create products and services that have the ability to serve the masses without needing to engage in customization. Mike develops each new offer with this in mind. Doing so enables him to sell the same item to thousands of people. This is one of the key tenets the successful use to create wealth. • T = Time-Freeing Ability: One of the tremendous strengths of the Internet is its ability to make things happen in the blink of an eye. If a product is downloadable, it can be provided within seconds of a customer ordering it. And if the product is physical, the confirmation and details of the order can be delivered to the customer within moments…and the automated process of fulfilling an order may begin just as quickly. Internet Prophets: The World's Leading Experts Reveal How to Profit Online by Steve Olsher What differentiates the success stories from the failures is that the successful entrepreneurs had the foresight, the ability, and the tools to discover which parts of their plans were working brilliantly and which were misguided, and adapt their strategies accordingly.
Numbers tell a compelling story, but I always remind entrepreneurs that metrics are people, too. No matter how many intermediaries lie between a company and its customers, at the end of the day, Customers are breathing, thinking, buying individuals. Their behavior is measurable and changeable. Even when one is selling to large institutions, as in a business-to-business model, it helps to remember that those businesses are made up of individuals. All successful sales models depend on breaking down the monolithic view of organizations into the disparate people that make them up. The goal of such early contact with customers is not to gain definitive answers. Instead, it is to clarify at a basic, coarse level that we understand our potential customer and what problems they have. With that understanding, we can craft a customer archetype, a brief document that seeks to humanize the proposed target customer. This archetype is an essential guide for product development and ensures that the daily prioritization decisions that every product team must make are aligned with the customer to whom the company aims to appeal. The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses by Eric Ries In the Lean Startup model, an experiment is more than just a theoretical inquiry; it is also a first product. If this or any other experiment is successful, it allows the manager to get started with his or her campaign: enlisting early adopters, adding employees to each further experiment or iteration, and eventually starting to build a product. By the time that product is ready to be distributed widely, it will already have established customers. It will have solved real problems and offer detailed specifications for what needs to be built. Unlike a traditional strategic planning or market research process, this specification will be rooted in feedback on what is working today rather than in anticipation of what might work tomorrow.
Questions to ask; 1. Do consumers recognize that they have the problem you are trying to solve? 2. If there was a solution, would they buy it? 3. Would they buy it from us? 4. Can we build a solution for that problem?” “Success is not delivering a feature; success is learning how to solve the customer’s problem.” The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses by Eric Ries A guy I met a while back used to be a drug dealer in another country, a long time ago, back when he was a young man, (He as since gone into IT which makes a twisted sense).
We were talking about pricing strategies, and he told me that he had back in the day, the best way to know when his pricing is right where it should be and he knew that he was cutting the best deal when selling. First off, we all agree that pricing is not an easy thing to do for most of us. People have all kinds of theories about how to set pricing, and how they know when they have the right price to still sell yet make the most profit. Every system feels like guess work, and no one ever says they had it perfect, but this system made sense. Some people just care to match what others are charging, basically match the market, but that is dangerous, because you don't have a system or a methodology, and what is the difference between you and the competitor? If he has better margins than you, your business is in trouble. You need to know what the customer is willing pay, and to do that, you have to know and think like your customer. Other businesses price just below others in the market, again, dangerous, as it just gets you those customers that care only about price, which means that you will lose them easily when someone else has a lower price. This is not a long term strategy. Works if your margins are better than everyone else's margins, but I wouldn't bank on it, as there is always someone out there who will compete. Any time your strategy is to be smarter than everyone else, you have a problem. There is always someone smarter than you out there. Trust me, someone is always willing to give them a lower price. You just end up in a price war that no one wins. There are theories of how to price, but the key to remember is that price is fluid, and that what you are selling on changes in value depending on who you sell to and their situation. How your customer views the product and how he uses it, and your customer's individual situation determines that customer's price. The cookie cutter one price fits all model doesn't work, and it just leaves money on the table. Which leads us back to the drug dealer. My friend told me that he always asked questions about his customers, and he knows their history, their likes and dislikes, which considering what he was doing was illegal back then, was a smart play. You only do business with other people you know well and trust, and he told me that when he discussed price, he asked them what was going on, what they were doing, and by that, got an idea where their mind was at, and then gave them a price, always slightly higher than what he felt was the market. He would sell the convenience factor, remind them of the trust between them, as the customer didn't want to keep looking, and the customer sure didn't want to have to find a new source, which is a time consuming process, and in this case, also might possibly be something that could get you put in jail. My friend said when he gave a price, if they took it right then, he knew he had priced too low. He was really happy when they hesitate and then say they have to think about it, and then they hang up. I ask him, you are happy you lost them? He said, I didn't lose that, I am happy because that is what you want, to know that the price you quote to them is close enough to make them want to buy right then, but just over what they wanted to pay, so that they say they have to think about it. Then they call up twenty minutes later and take the deal. When that happens, you know you got the most money you could out of that transaction. PS. Another point of the story, there are business lessons everywhere, listen to everyone. I do. Drop me a note, say hello. D Recording Your First Podcast
When getting started, don’t worry about fancy gadgets. You can purchase the necessary equipment for less than $100. Once your podcast gains traction and popularity, you can opt to upgrade. To create a high-quality sounding podcast, follow these seven simple steps: 1. Buy a USB microphone and plug it into your computer. Jason (Internet Business Mastery) recommends the Snowball from Blue Microphones, which is an affordable, high-quality USB microphone. To learn more and/or purchase the Snowball Microphone, visit EZ.com/snowball or use your mobile device to scan the QR code to the left. 2. Download Audacity or other software to record and edit your audio files. Audacity is a free recording and editing program you can download at Audacity.sourceforge.net. Even with Jason’s success, he still uses Audacity, proving it’s absolutely possible to record high-quality podcasts without dropping an arm and a leg to do so. Once you’ve completed steps 1 and 2, you actually have everything you need to record your first podcast. If you’re the star of the show, click Audacity’s record button, talk into the mic, play some music, and you’re good to go. If you want to take things to the next level, bring on guests and/or co-hosts. Unless they’re in the room with you, though, proceed to Step 3. 3. Use Skype and/or other software to connect with others and record conversations. If you’re going to have guests from around the country and/or the world, you want to be able to connect with them inexpensively. A popular favorite is Skype (Skype.com). Next, you need software to record your conversations. For a PC, Jason recommends Pamela (Pamela.biz/en), SuperTinTin (Supertintin.com) or Vodburner (Vodburner.com); and for a Mac, Call Recorder (Ecamm.com/mac/callrecorder) or Audio Hijack (Rogueamoeba.com/audiohijackpro). After the conversation is recorded, you’ll need to import the audio into Audacity and edit it, removing delays and other nonessential elements. Getting the hang of this may take a little while; but once you learn how, it’s easy. 4. Condense your audio file by converting it to MP3. When you’re finished editing in Audacity, you’ll have a large .WAV file. You’ll typically want to condense it to a more manageable size. The best way is to convert it to the MP3 format. For example, a 100MB WAV file will shrink to around 10MB as an MP3. Two recommended programs for doing this are WAV To MP3 Converter (WavToMP3Converter.com) and ConverterLite (ConverterLite.com). 5. Create album artwork to represent your brand. Don’t ignore this crucial step. When people listen to your podcast the album artwork and podcast description will be displayed throughout the show, so it really makes an impact. 6. Upload your podcast to an audio hosting site. Jason recommends using Liberated Syndication (LibSyn.com) as your host for two key reasons: • You can subscribe for as little as $5 per month, which provides up to 250MB of storage. • LibSyn.com offers upgrade packages to easily handle your bandwidth and upload growth. 7. Get your podcast listed on iTunes, YouTube, and other sites. While iTunes.com and YouTube.com are the most famous directories of podcasts, there are many other sites where you’ll also want your podcast to be listed. Use Google to find directories that are a solid fit for your topic. With these seven steps in place, you’re now in the podcast business. Internet Prophets: The World's Leading Experts Reveal How to Profit Online by Steve Olsher One of the fastest ways to grow your business online and off is to share your message and mission in high-visibility venues.
The hottest trends among top experts and online marketers today include video marketing, teleseminars, webinars, and the big kahuna of profit, live events. But, how can you stand up and stand out in a competitive marketplace? Oren Klaff, author of Pitch Anything: An Innovative Method for Presenting, Persuading, and Winning the Deal, says: “A great pitch is not about procedure. It’s about getting and keeping attention.” Knowing how to grab people’s attention, share your message, and close the deal is a skill that allows you to secure expert status, shine at local networking events, speak to groups, and build your marketing platform. Be forewarned—studies show that people make approximately 11 assumptions in the first 11 seconds…and, those first impressions are long lasting and hard to overcome. Make a great first impression and people will be forgiving of later missteps. Start off on the wrong foot, and it’s a continuous uphill battle. Whether online or in person, it is important to secure a strong first impression that accurately reflects who you are, what your message is, and how you want to be perceived. While content is crucial, it’s not what motivates people to take action or what someone is actually buying. Kristin believes moving prospects to take action is the direct result of implementing the compelling combination of content, connection, and inspiration. This is what drives someone to open her wallet and take the next step. Internet Prophets: The World's Leading Experts Reveal How to Profit Online by Steve Olsher I don’t think there’s such a thing as an original artist.
We all show influences and derivations. We can’t avoid using or being used. When it comes time to express yourself, what you put forth should be done unconsciously, without thought of influences. But all this is in your blood already, in the very stream of your being. I’ve come to believe that I’m at my best, I express myself best, when I’m following the philosophy of the East, but I wouldn’t propose it as the one way. I think each one has to find his own unique route. I think the peculiar quality of an artist is that he’s both participant and observer at the same time. He’s playing a dual role always. I mean, I don’t go through life as a writer who’s always making notes in a mental diary, though I am aware of making note of things for future use. I can’t help it; it’s my nature. But I don’t enter into things in a spirit of detached research. When I participate, I do so as a human being; I’m simply more aware than most men of what’s actually happening. Henry Miller The Playboy Interview: Men of Letters by Ray Bradbury, Saul Bellow, Lee Child Kurt Vonnegut, Chuck Palahniuk We must discover whether we are on a path that will lead to growing a sustainable business.4/23/2013
Yet if the fundamental goal of entrepreneurship is to engage in organization building under conditions of extreme uncertainty, its most vital function is learning. We must learn the truth about which elements of our strategy are working to realize our vision and which are just crazy. We must learn what customers really want, not what they say they want or what we think they should want. We must discover whether we are on a path that will lead to growing a sustainable business.
In the Lean Startup model, we are rehabilitating learning with a concept I call validated learning. Validated learning is not after-the-fact rationalization or a good story designed to hide failure. It is a rigorous method for demonstrating progress when one is embedded in the soil of extreme uncertainty in which startups grow. Validated learning is the process of demonstrating empirically that a team has discovered valuable truths about a startup’s present and future business prospects. It is more concrete, more accurate, and faster than market forecasting or classical business planning. It is the principal antidote to the lethal problem of achieving failure: successfully executing a plan that leads nowhere. Lean thinking defines value as providing benefit to the customer; anything else is waste. In a manufacturing business, customers don’t care how the product is assembled, only that it works correctly. But in a startup, who the customer is and what the customer might find valuable are unknown, part of the very uncertainty that is an essential part of the definition of a startup. The effort that is not absolutely necessary for learning what customers want can be eliminated. I call this validated learning because it is always demonstrated by positive improvements in the startup’s core metrics. Remember that validated learning is should always be backed up by empirical data collected from real customers. The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses by Eric Ries |
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