I thought of taking a break from just talking about marketing.
Those of you who follow my blog know that I like to identify the differences between words in English and how they get used. An Oxford dictionary is still among the prized possessions in my library.
I was listening to a talk by Sean Stephenson on the Ilovemarketing mastery program by Joe Polish and Dean Jackson.
He brought out an important point on Arrogance versus Self Confidence.
Which led me to the dictionary again and this is what I got at the meriam-webster site and I have taken it from there and posted below
Definition of arrogance
: an attitude of superiority manifested in an overbearing manner or in presumptuous claims or assumptions
Definition of self-confidence
: confidence in oneself and in one’s powers and abilities
Sean’s take was that people with confidence have a tendency to always want to improve themselves and keep increasing their capabilities which increases confidence further.
On the other hand people who are arrogant are always trying to prove a point to others or to themselves.
What was more interesting was what he mentioned after this. Can people who are confident about themselves come out as arrogant to others.
As per him if someone thinks of your self confidence as arrogance, then it means they are jealous of you. Which is the price for being successful.
Bottom line is if people are jealous of you then you know you are being successful. And if people are not jealous of you then maybe you are not playing a big enough game.
Till next time.
In my post yesterday I spoke about how you could go about partnering with inflencers and other merchants / companies who sell to the same niche.
There are 2 decisions to make the above successful.
First is the fact that you will need to hustle and connect with people. No one is going to find you. You have to make yourself found.
The second is the arithmetic behind the number of people you can partner with.
Which brings me to the concept of Life Time Value. This concept is explained very well by Jay Abraham and then Joe Polish and Dean Jackson
Most people, including people working in large companies don’t understand this concept, due to which they take short term decisions in accepting the first order.
Let’s say you have an average deal size of $100,000. In this you have a gross margin of $10000/-. This customer can buy from you the same product or service maybe 2 more times over the next 5 years. Which means over the next 5 years this one customer can give you a gross margin of $30000/-
Now if you have given this customer exceptional service then she may also refer one more customer like herself to you who could also give you another $ 30000/-
Which is a total of $60000/-. However you won’t make this if you don’t get the customer in the first place. The longer you can keep your customers to keep coming back for mere the higher this value becomes. As Joe Polish says, it also helps you to stop thinking in episodic nature and start thinking of very long term relationships with your customers.
Which brings us to the next point, how much are you willing to spend to get the customer first. This could be in terms of giving your partner all the first year margin or giving added value of $10000 to the customer. I am generally not in the favor of giving a discount because it becomes very difficult to raise prices once customers get used to one price point. Like I mentioned in my post yesterday, you could go on the ilovemarketing podcast or the morecheeselesswhiskers podcast and get a lot of examples how businesses of all sizes have used this.
The more you can afford to spend to get a client upfront and the longer you can be at it, the more successful you will be in getting your product or service to take over the market.
Till next time
Given the 3 assumptions I had stated in my last post apply, from here on we will look at different examples – on how I would go about expanding the business in the niche.
Its never easy to get into a new market with a new product or service. So we first do our survey on the demographics to see if there is a large enough market. So if we were to look at the market for Red Eggs – our niche in the eggs segment, that we want to capture then we would find a segment of people who like to have gourmet eggs, who understand the benefits of these eggs.
Then our first effort would be to find where can we get hold of the top influencers – the top 25 people you could influence with your product or service who would then vouch directly or indirectly. You need to then figure out what’s in it for them, how you can help them, for them to be interested in looking for you. What Robert Cialdini call the principle of “Reciprocity”
So if there is a celebrity chef, a store which sells gourmet foods anything else….list out all these 25 people. Then work to figure out who do you know, who knows someone, who knows one of the 25 people and start making your connections.
First help them in areas where they need support – and everyone has some areas where they need support. Maybe you help them in their charity work – all the red eggs that you sell – all the revenues go to fund their favorite charity as an example. This helps get you exposure and further connects.
Since you have chosen a very small market to focus on you will not have to waste energy or money or time to go all across and reach people in distant places. You will be local in the area and the word about your product or service will spread fast.
As a next step you need to find the people who already do business with the potential client you have identified. So if you are looking to start in a small county in New Jersey which has luxury homes where you think your ideal client for “red eggs” exists then you find other businesses who sell to those luxury home owners. The dry-cleaners, the carpet cleaners, the local retailers and set up a mechanism to help them keep all the profits from what they sell of you “red eggs”. If you hear the ilovemarketing podcasts from Joe Polish and Dean Jackson you will get so many ideas on doing these partnerships
Which brings me to a very important concept , to pick up tomorrow – the life time value of a client. You can’t do a lot of the stuff I am speaking about above, if you don’t understand this concept.
Till tomorrow then.
Joe Polish has this wonderful example of a kaleidoscope and telescope. If you look into a telescope you can zoom into a specific object and identify this out it.
On the other hand if you look through a kaleidoscope, you see a lot of beautiful patterns but you can’t find one specific thing to focus on. As you keep rotating the kaleidoscope the patterns keep changing and keep mesmerizing you, diverting your attention from good pattern to the next.
When you niche, you not only find what you need to focus on, but you also find what you don’t need to focus on.
As marketers we are always seeing opportunities like the patternsin a kaleidoscope. A marketer is fundamentally positive by nature and therefore see opportunities all the time. This however is the downside for us, it tends to distract us.
By creating a niche and sticking to it, you put the blinders on for everything else. Then your messaging to your audience improves, you are able to identify all the different nuances for the audience and therefore slowly start owning the space in the mind of the customer.
Once you can own the space that’s when the game starts and you make profits.
Till next time.