Developing a successful and profitable business is not a simple undertaking. It is dependent on many external factors, including competition, timing, and demand, over which you initially have little to no control. Assuming all of these external factors work in your favor, having a solid business plan can result in a prosperous enterprise. Consider the following five steps when building a business from the ground up:
Determine your business strategy. What products do you sell? <br>
This question is not as straightforward as you may believe. Nike, for instance, is in the business of sportswear, but when you buy a pair of Nike shoes and a t-shirt at the mall, you’re actually purchasing an image and an emotion. You are purchasing Nike merchandise. Richard Thalheimer, the former CEO of The Sharper Image and founder of RichardSolo.com, has more than 30 years of experience in specialty retail. When asked what business he is in, he will respond with “convenience” or “innovation” rather than a specific industry, and he has built one of the most powerful brands in the United States. Keep in mind that there is more to a product than the product itself. Your product’s brand is what differentiates it from those of your competitors.
2. Choose your market Who are your customers? <br>
This step is a bit less interpretive than the first, but nonetheless crucial. Who are your customers? Alternatively, what do you know about this individual? Understanding your target market is essential for success. How do they operate? Where do they frequent? What are their television viewing habits? These are just some of the questions you should be able to answer regarding your customer. When it comes to formulating a marketing strategy, knowing the answers to these questions can answer a number of your own questions. Richard Thalheimer probably understood his target audience for The Sharper Image as well as they did. Tracy Wan, the former president and chief operating officer of Thalheimer, is quoted in the LA Times as saying, “Richard has an incredible ability to figure out what people want.” This ability to perceive a consumer’s desire is only possible if you know them as well as a neighbor.
3. Develop a marketing plan. How do you address these individuals? <br>
This is the culmination of your brand and consumer knowledge. As stated in number two, understanding your consumer can provide answers to numerous marketing strategy questions. Where should you place your ads? What voice does your brand have? What are reasonable prices for this demographic? To engage your consumer, i.e. sell them your product, you must, among other things, know where your advertisements will be seen, how to speak to them, and how much they will be able to spend. Essentially, this step should have been combined with the preceding one, as your marketing strategy is entirely determined by your target audience.
Learn by observation. Seek advice from those who have completed the task.
There are numerous books written by professionals who have already successfully launched their own businesses. Richard Thalheimer comes to mind immediately, as he has already been mentioned several times. In “Creating Your Own Sharper Image,” the author describes how he expanded his small office supply company, The Sharper Image, into the thriving enterprise it is today.
Remember that building a successful business is about more than just money. Equally valuable are your brand equity and your ability to engage your consumer, which can only be attained through a thorough comprehension of them. Following these four steps will lead you in the right direction, assuming there is a market for your product and that you can compete with other brands.
~Ben Anton, 2008