What’s problematic these days is the assumption that coming up with a brilliant idea is all it takes to be successful. That is never the case. If you think of entrepreneurship as a story with just a great idea, you are likely to fail. To succeed you need good positioning, which translates to finding the right business model. A business model is simply how a business makes money. You need to set the right price, messaging and delivery channel to the right audience to sustain and grow your business.
Defining the right business model requires the same care as the product. However, the approach and the skills required are different. This is one of the reasons it is advised to have a tech co-founder. He can build the product while you focus on perfecting the business model. You can have a great product that people, but if it is not positioned well, it will fail. Your business model needs to be great. Here are a few things you can do to achieve that.
1. Identify the right audience
The most important element for your business is the customer. You need to sell your product, and the customer will decide whether to buy it or not. When creating your business model do not go for a wide audience. That will make it harder for your business to pinpoint on customers who actually are interested in your product. Always narrow down your audience and keep it focused. Just think of who you can serve best.
2. Test your product
You might think you have a brilliant idea, but you need to be sure if your audience feels the same way. Once you have a prototype ready, test it. Have sample customers use it. Are they willing to pay for that experience? See if they feel the same way about it as you do. Above all, take feedback on how to make it a better fit. If your product does not resonate with the customers, then you should just let go of it.
3. Establish business processes
Before you launch your business, you should have a strong understanding of what is required to make your business model work. What are the activities that the business will be doing? Will you only be offering the product? Or will you also do shipping? What about consulting? You need to establish what your business processes are.
4. Determine Key Business Partners
It is important to establish strong connections. Your business can not be successful without key partners that help you serve your customers. You need good suppliers, marketing and advertising partners, and strategic alliances. Hence, when creating a business model make sure you select excellent partners that can help you achieve your goals.
5. Take help
You should take help from people with experience. These could include investors, advisors, mentors and experts in the particular field. People from outside the company can give you the positive criticism that you might really need. Also, these people can open up their distribution and sales channels to help you out.
6. Keep innovating
As you scale and grow your business, the dynamics of it will change rapidly. Customer needs and demands change over time. You need to be able to adapt to these changes, and your business model should be able to meet customers’ ongoing needs. Therefore, it is important that you leave room for innovation. Do not assume that your business model will stay the same. You need to review it often and implement changes when needed.
In conclusion, you should work on your business model as much as your product. If you don’t, your business will not be successful. Hence, follow the tips discussed, and create a solid business plan that can drive the success of your business.
Also see: How to start a startup