Your aunts, uncles, mom and friends have all said that you are great at something and usually end by saying "you should really think about making this a business, you could make a LOT of money!"
All of those great compliments and free products and services you have provided for these people gets you thinking "hmmm, maybe they are right, maybe I should give this thing a try." But will people actually BUY my product or service? You have proved that people will buy it - for FREE but what about purchasing it with real cash?
What problem are you trying to solve?
Getting down to the nitty-gritty - a good business idea is something that will solve a problem. We may feel that our passion or skill is all we need to start a business but in order to have a feasible business idea it must SOLVE a problem. You have to figure out what problem you are trying to solve and who you are trying to solve the problem for. In my experience that is half the battle and really puts you on the right track. After, you understand what problem you are trying to solve in the market, then everything else becomes a lot more easier and you will be able to develop the clear messaging that will register in the hearts and minds of your target audience.
Tip: "A business is simply an idea to make other people's lives better"
- Richard Branson
How will you make someone's life better?
Better yet, to take this a step further not only should a good business idea offer a solution to a problem but in the words of Richard Branson "it should make people's lives better." Let's use me as an example. The problem my business is trying to solve is to help female entrepreneurs start their own business by breaking down or cutting through the barriers of business ownership. In turn, when I help someone set up their business this also improves their financial, personal and family life. So many women have come to me because they have always wanted to start their own business but just didn't have the know-how of how to make it happen or tried doing it on their own and just became so overwhelmed with all of the information they got discouraged and quit. So, that is where I step in and help them solve their pain point. I give them the education, resources and assistance they need to make business ownership a reality.
Do you have the skills and passion needed?
You may have a great business idea but do you have the skill set and passion required to pull it off? It is often said that: Passion + Skills + Solution to a problem = a great business idea If you can combine those 3 items you will be off to a great head start. After you define your WHY, determine what you can contribute and what will be valued most by customers you will have found your sweet spot!
What is your unique selling proposition?
Definition: The factor or consideration presented by a seller as the reason that one product or service is different from and better than that of the competition
Most likely your business idea won't be unique, meaning it could be something that someone is already doing. However, if you find out that your business idea isn't 100% unique don't let that discourage you. You don't have to reinvent the wheel either. However, use your competition to your advantage. Use their information to better understand the market, customers, prices, products, etc. See what works for them and what doesn't. Find out where they need to improve and incorporate those elements to your own product or service.
A unique selling point, or USP, is something that makes you different from your competitors currently in the market. It is what your audience can't or won't get from anyone but you and your business. As an example, I truly enjoy living a plant-based lifestyle but will eat organic, grass-fed meat from time-to time. I love green smoothies and was so glad when I stumbled upon Mango Tree. The reason is because they are the only smoothie bar in my area that uses all fresh ingredients that are not processed. I have been to Smoothie King (yuck!) in the mall and they add so many processed ingredients such as syrups, sugars and who knows what else that I will never go there again. Although there are probably plenty of smoothie shops in downtown Atlanta or other places, Mango Tree is the closest one to me that offers truly fresh, plant-based ingredients that also taste good! That is their unique selling proposition and is why I go there 3 times a week or more. I have not found any other place in my area that gives me this.
While developing your product idea, you should try and predict whether the idea will fulfill a customer's need. This is where the unique selling proposition (USP) comes into play. It helps you to determine if your product or service will find a market before you put a lot of money or time into it. Use your USP to determine if your product or service is different than what is currently out there. You must have a strong differentiating characteristic that set your business apart from your competitors in order to convince a potential customer to stop buying from your competitor and buy from you instead. If you actually do have a unique business idea that has never been done before, then you still need to convince customers why they should buy from you and what problem you will be solving for them. Your USP will be the key component that you use in your marketing campaigns and other communication with potential customers. Your USP is the heart of your business.
Writing your USP
Most USPs are only a few sentences long but that doesn't mean you should just rush through created one. When creating your USP, marketing consultant, Perry Marshall wrote in Business News Daily that you should ask yourself these 3 questions and he also provides some example responses for each:
Why should I do business with you instead of anyone else?
We offer the nation's most affordable health care coverage to businesses with 10 employees or fewer
What can your product or service do for me that others can't?
We sell the only pain-relief cream that will completely eliminate carpal tunnel symptoms in 7 days
What can you guarantee me that no one else can guarantee?
We are the only car dealership in the tri-state area with a five-year, 50,000 mile warranty
Marshall goes on further to explain that "to determine what truly sets them apart, businesses should look at several key areas including the service they offer, the market they cater to, the products or services they sell, their customer experience and their pricing." Your USP is not just a company slogan - treat it like it's your company's DNA. Marshall also adds that "if you cannot summarize exactly what sets you apart in one or two sentences, you are not unique enough within your marketplace."
Entrepreneur.com provides some great recommendations on how to go about doing this:
Put yourself in your customer's shoes. You are there to fulfill your customer's needs and satisfy them. What is the reason that your customers come back to you again and again? Remember, price is never the only reason people buy.
Know what motivates your customers' behavior and buying decisions. Good marketing will require you to be a bit of a psychologist and go beyond just customer demographics. You need to know what actually motivates your target audience to buy and then to buy from you. Sometimes people buy based on their desires or emotions and not on their needs.
Uncover the real reasons customers buy your product instead of a competitor's. When you do acquire customers make sure you ask them why they buy from you. Find out what is it that makes them come back. There is no better feedback than from the customer themselves. Use this information to improve your product or service.
Here are some examples of unique selling propositions from Business News Daily:
Avis: "We're number two. We try harder."
FedEx Corporation: "When it absolutely, positively has to be there overnight."
M&Ms: "The milk chocolate melts in your mouth, not in your hand."
Dominos Pizza: "You get fresh, hot pizza delivered to your door in 30 minutes or less, or it's free."
NyQuil: "The nighttime, coughing, achy, sniffling, stuffy head, fever, so you can rest medicine"
Target: "Expect More. Pay Less."
Geico: "15 Minutes Could Save You 15 Percent or More on Car Insurance."
Enterprise: "Pick Enterprise. We'll Pick You Up."
NEXT STEPS
Download or purchase a hardcopy of my book & complete the exercises for step 5
Read the next article - Step 6 " What is business planning and do I REALLY need to do it?"
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