Don’t Waste Your Incoming Traffic:
Creating Value for Customers
Business 101 for Startups: Part One
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We, as entrepreneurs, live in an incredible time! Whether you run an online business, or have a brick and mortar storefront, the advance of the Internet, transportation, and communication has provided an unprecedented level of opportunity and access to an enormous potential customer base. However, this also means that the barrier of entry for other entrepreneurs is equally low, leading to a rising level of competition.
According to Forbes, there are over 500,000 new businesses started every month. There are also almost 1 billion live websites on the Internet. That is a lot of competition! Because of this, many startups focus a large portion of their efforts on driving traffic and potential customers to their business. But we can not lose sight of the customer during this process.
We must create value for our traffic, or we are wasting all of our efforts to bring them to our literal or figurative door! If our actions as entrepreneurs are focused solely on bringing potential customers to us, instead of bringing value to potential customers, our visitors will not return, our conversion rates will be low, and our growth will be stunted.
Today, we want to focus on four opportunities to create value for customers. Putting the effort into building value will improve conversion rate, develop loyal customers, and help grow your brand. We have put together some great business examples of how to build value through a product, a service, a shared resource, or a subscription.
Creating Value Through a Product
It would be hard to discuss a great example of product value without bringing up Apple. Whether you love or hate them, you have to admire their ability to build such a fiercely loyal customer base and break out in to new markets time after time with such success.
Why has Apple seen such success with their products?
Their services (computer repair, tech support, etc.) are not what they are known for and not what drives people to their products.
The amount of free resources and information they provide to potential customers is minimal and is not what brings people back to the Apple store.
What sets them apart from any other manufacturer of computers (or mp3 players, or streaming devices, or…)?
Simon Sinek, a leadership expert and author of “Start With Why,” has a convincing theory.
All companies know what they do.
This is the products and services they offer. Apple creates great computers. This is what they do.
Some companies know how they do what they do.
How does Apple create great computers? They create computers that are beautifully designed, simple to use, and user-friendly.
Very few companies know why they do what they do.
Because of this, most people build their value propositions on the what and the how, the two things that are easiest to put in to words. For example:
✓ Learn How To Market Research
✓ Learn How To Think From The Perspective Your Customer
✓ Learn How To Write A Value Statement
You can download the full list by clicking here
The Wrong Way to
Build a Value Proposition
“At BiohackingEntrepreneur.com we provide only the best resources for those who want to perform better as individuals and as entrepreneurs (what), by only recommending the biohacks, techniques, and tools we have tested ourselves and are currently using (how). Please subscribe.”
This is how most value propositions look. “Apple creates great computers by making them beautifully designed, simple to use, and user-friendly. Buy one.” This is not very compelling at all.
Simon Sinek states in a TEDTalk that nearly all great leaders, companies, and entrepreneurs go in the opposite direction and this is what drives their success. They start with the “why,” which leads to the “how,” and the “what” is simply a result of the first two.
The Game Changing Way to
Build the Best Value Propositions
“BiohackingEntrepreneur.com believes in empowering and encouraging others to become the best version of themselves they can be. We do this by building a community for like minded individuals in which we share our failures and successes with biohacks, techniques, and tools that we have tested. We just so happen to have great resources for entrepreneurs looking to push the boundaries of their potential as a result.”
To bring it back to how Apple has built their loyal customer base: “Apple believes in thinking differently and challenging the status quo with everything they do(why). They do this by creating products that are beautifully designed, simple to use, and user-friendly(how). They just so happen to make great computers as a result(what).”
Much more compelling isn’t it?
Do not approach your product with a “what” mentality. Begin by asking why and let the products you offer come as a result.
This isn’t just applicable to bringing value to your customers through a product. Utilize this thinking to bring more value to your customers and grow engagement in every opportunity, whether a service, shared resource, or subscription.
Creating Value Through a Service
We often overlook many of the global behemoths of industry as examples of entrepreneurial success, but many of these companies started with humble roots and provide very applicable examples. One such company is Fedex. Although Federal Express is now a globally recognized company, there were many times founder and CEO Fred Smith was starting out that the company teetered on the edge of bankruptcy. Fred believes he grew the company to the success story it is today by focusing on customer’s in two big ways.
Consistently Deliver (no pun intended) On Your Promises
Fedex’s motto is, “when it absolutely, positively has to be there overnight,” and employees are trained to go out of their way to follow through on that promise. Their willingness to do what other companies often won’t provides value for their customers and sets them apart.
Charles Gaudet, founder of PredictableProfits.com, tells the following story:
“A woman called FedEx frantic with worry… It was her wedding the next day, but her dress was on the West Coast. The problem? She was on the East Coast.
Every other delivery company she called said that delivering the dress on time would be impossible, but FedEx employees had been trained to deliver – even when no one else would.
At great expense, they hired a private jet and had the dress delivered to the woman.
But FedEx didn’t know that the woman was the daughter of Eastman Kodak (the founder of the Kodak Company). Attending her wedding were Fortune 500 CEOs and various other captains of industry…
When these guests heard the woman’s gushing praise for the company that had delivered when no one else could, they were naturally intrigued. The corporate clients FedEx won over as a result of this one delivery kept the company in business!”
Selling Value, Not Price
Salespeople and managers at Fedex are taught to build solutions for their clients based on the client’s goals, not based on pricing. This requires an investment into and a knowledge of the client’s business and their needs, but it increases the loyalty of the customer as well.
Get to know your clients. Learn what drives them and what success looks like to them.
These two mindsets are working for Fedex. A research study by 24/7 Wall Street and Zogby Analytics found Fedex to have some of the most satisfied customers in 2015.
I am not saying you should begin offering your services to be completed overnight like Fedex. What I am suggesting is that your focus must be on the client and their needs in order for you to provide value for your customers and realize the best conversion rates.
Are you noticing a pattern yet? The techniques used by Fedex and Apple shift the focus from the product or service and to the customers.
Creating Value Through
a Shared Resource
Google is the king of using free resources and tools to build an empire. Most of the resources Google provides to customers, such as email accounts, analytics information, and one of the largest search engines in the world, are free. In spite of this, they are making 33 MILLION dollars of profit/PER DAY! Yet, I never get the feeling that I am being funneled into a purchase, or that they are only giving me useless information in an effort to get me to pay for more.
A huge key to their success is that they truly are offering valuable resources for free. They aren’t creating elaborate sales pitches that leave any useless information behind a paywall, or sneak peaks at software that disable any true functionality. Yes, you must be able to monetize your business or your business will cease to exist. But that doesn’t mean that everything you do must be directly monetized.
In an effort to stand out from the competition, creating free and valuable resources goes a long way, and establishes you as an expert in your field with valuable skills, knowledge, and services.
Creating Value Through a Subscription
I have a bartender friend who was recently telling me how hard it has been for them to stop purchasing from Amazon since they started an Amazon Prime subscription. They were not angry, nor did they feel duped into purchasing more than they wanted or could afford. They were excited, because Amazon Prime was making it easier for them to access the services they were already using.
Because the bar is open so late, the mall and most other stores are closed by the time they get off. They could shop online from just about any online store, but their subscription to Amazon Prime provided incentives for them when they shopped with Amazon. Discounts, free two day shipping, and free streaming of different tv shows and movies are just a few of the perks they receive as a member.
An Amazon Prime subscription is not just a way for Amazon to funnel customers towards spending more every chance they get, but provides real value. Your subscriptions, whether a free weekly email, or a paid member program like Prime, should be built on the same principles. Shift your focus away from constantly driving your subscribers to buy content and instead provide benefits that they will appreciate and utilize.
It is estimated that Amazon Prime gained over 50 million subscribers in less than 10 years. Can you imagine if your website had 50 million subscribers?
- You fight hard for your traffic. Don’t waste it by having a mediocre or sub-par offering that contributes to high bounce rates and a lack of return traffic.
- Ask yourself “Why are we doing?”, instead of “What will we do?” Build your value propositions on that mindset.
- Learn what your customers need to achieve their own success.
- Not every action needs to be monetized. Provide real value and proof of your expertise with shared resources.
- Your customers are smart. Don’t try to dupe them into subscribing, but give them real incentive to subscribe and stay subscribed.
A customer centric way of thinking will help you create value for your visitors, potential customers, and clients, bringing in repeat traffic and keeping you from wasting the traffic you work to drive to your business.
Check out our reading list on our resource page for biohacking entrepreneurs, to see some of the other ideas that have driven how we build our businesses.
In the next part of our Business 101 for Startups series, we will be discussing marketing. Subscribe below to receive the latest business tips and hacks for entrepreneurs.
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