How to Sell Anything to Anyone

What is the most profitable small business to start-up?

Without any single hesitation, the most profitable small business any aspiring entrepreneur can get into is any start-up company related to selling information. Information is a pretty vague name so to be clear, let me refer to it as the knowledge business.

In today’s world, everyone has pretty much realized that the gap between success and failure and prosperity and poverty is access to information. No wonder they say that information is power. The concept is simply all about starting businesses that connect information with people who are looking for it. The end result is very profitable.

I define the most profitable small business as company that generates a lot of profit with low and limited expenses in the shortest time possible. The added benefit with information businesses is that they’re easy to launch, hard to imitate and scale quite nicely (for instance if you had to start a blog publishing business, if you write an article, it can be read by one person or two millions without doing anything but promotion).

Some example profitable information small businesses that quickly come to mind include: 

- Blog publishing
- Seminar organizing
- Private tuition
- Professional speaking

(The D Conference is a typical information business. Attending the event is is super expensive and they still get sponsors who cover most of the expenses in my estimation. The D Conference is a profitable small business that probably does not require a big staff but brings in a fortune!)

Most people refer to this type of entrepreneurship as infopreneurship, a smartly coined term that explains the concept well. It’s perfect for stay at home moms or anyone interested in a home business, those wanting businesses that allow them to work from anywhere or those dreaming of big empires. After all, billionaire Rupert Murdoch made his fortune in the newspaper business, which is nothing but selling information.

If you’re curious about infopreneurship, the most profitable small business venture to get involved in, you should check out Make Your Knowledge Sell, a free PDF book written by an infopreneur who made a lot of money selling her knowledge and an inventor who provides entrepreneurs a tool to make it happen.

Patience is a virtue. In early-stage entrepreneurship, it’s a must. Today, I was speaking with an entrepreneur who was wondering why his marketing efforts were not bearing fruits. He is fascinated with the fact that a fellow entrepreneur in a completely different industry, went from zero to having customers sign-up to a waiting list in less than a month.

As I dug deeper into the story, it turned out that the “fast” entrepreneur had contacts in the press and was a well known local personality. Two important competitive edges that our entrepreneur does not have.

Patience is the name of the game in early-stage entrepreneurship. It takes a while for people to be familiar with a concept, to even hear of it and for it to gain momentum. While the wait is on, an entrepreneur should just focus on perfecting his business with the little clientele that she or he has so that when the floodgates open, she or he will be ready and able to handle it through experience.

Each industry has its own specific growth speed. Microsoft took more than ten years to become a serious contender. Google did it in three. Any entrepreneur who uses Google as a model for momentum gathering is setting herself or himself for sheer frustration.

(Marsupials give birth after 1 months. Alpine Salamanders give birth after 3 years! Now, that’s patience for Salamanders! Photo courtesy: Wikipedia)

Patience is a virtue. With the right strategy and a consistent implementation of a sold marketing plan, everything will fall in place eventually. Patience please. Entrepreneurship is not a sprint. It’s a marathon.

“Do something you love”. That’s one of the most common entrepreneurship piece of advice. It makes sense, as there’s nothing worse than slaving away on a venture that does bring any sort of joy.

However, what ends up happening is that early-stage entrepreneurs do really fall in love with their business that they lose all objectivity. They claim to have the best product or service, they underestimate the competition and even worse they naively overstate their revenue projections.

With that sheer loss objectivity, they conduct business as usual until the reality hits them and reveals that while their so called product or service may be the best, customers and clients do not think so, that the competition is very fierce and that their target objections will never be met as soon as planned.

It’s human nature to lose all objectivity so no need for entrepreneurs to beat themselves up over it. Simply realizing that it happens to anyone is the first step to avoiding this trap.

This is when a subjective third party is needed. It may be a partner, a mentor, the press, customers or the competition to a certain extent.

The day you start thinking that you’re the best, that you can do no wrong or that the competition is too dumb is the day that you should come to the conclusion that you’re seriously losing your objective judgment.

Entrepreneurs ought to be subjective and deal in real situation in the present world. Just because your product or service is proven to be the best does not mean that automatically the marketplace will flock to it when made available for sale. You still have to compete fiercely especially the other businesses have more money to throw at their marketing campaigns than you do.

To avoid total loss of objectivity, I personally put myself in a situation where the people whose opinions I trust or matter tell me the real score first hand. Yes it does something to the ego but it’s certainly better to be informed than to run amok in one’s own fool paradise!

By the way, entrepreneurs should never state that they have the best product or service. That statement sounds so self-serving and therefore has zero credibility. When reputable third parties rate your product or service the best over competitors’ then the tribe has spoken and the bragging can start.

Anyone can claim to be the best at any sport but unless they have Olympic gold medals to prove it, they will probably be looked at with pity. Don’t be that entrepreneur please!

The best marketing ideas are free no matter the type of business. Early-stage entrepreneurs are always looking for the breakthrough concept that will take their ventures to the next level.

As a regular reader, you will eventually get tired of me mentioning time and time again to spend a great deal amount of your time reading the small business website sections of major nationally newspapers and the websites of magazines geared at small business owners, operators and entrepreneurs.

The mission of these publications is to report on what’s going in the world of small businesses. Put differently, they keep entrepreneurs up with what the competition is up to and what other entrepreneurs another type of business are up to. 

Talk about an unlimited supply of free marketing ideas!

How should an early-stage entrepreneur react when she or he reads about Ben and Jerry’s free cone day for example? How does this company’s business promotion affect his or her type of business?

Marketing ideas such as “the free cone day” are yours for the taking! Obviously, you’re not going to be giving away free ice cream if you’re an early-stage entrepreneur in the hair care industry or of if you are the owner of an interior design start-up firm.

You just have to adapt the business of promotion to your type of business. How about publicizing a free haircut day for all volunteers at local NGOs? Or what about giving away samples of a new buzzed about hair product (the manufacturer or distributor could foot the bill for this business promotion as he’s the ultimate winner)?

How about the interior design firm publicizing a give away of a DVD featuring some amazing private residences?

A number of marketing ideas can spring from one business promotion concept read in a magazine.

You can bet that this business promotion will also work for your type of business because if the original idea captivated the media, the odds of the variation adapted to any type of business will also captivate them!

There’s a popular idiom that really explains why some entrepreneurs set themselves up for failure before even starting their ventures.

I was casually chatting with an early-stage entrepreneur in the entertainment/nightlife industry and he was telling me about the venue that he was opening in the next couple of months. He had all the details worked out from the exact painting on the walls to the brand of big screen televisions.

When I asked him what he would exactly offer to the patrons. He told me that it would depend on the night, it would be depend on the concepts that would work, on the promoters and so on. “The major task is to build a very beautiful, cosy and welcoming venue and then the people will come”, said the strong-willed entrepreneur in a nutshell.

Talk about putting the cart before the horse!

In extremely competitive marketplaces such as the nightlife entertainment sector, early-stage entrepreneurs cannot simply launch a venue and hope for the best. It’s the worst strategic mistake ever that will surely cause business bankruptcy within six months.

Furthermore, I was shocked at his reasoning that because he was in such a busy and crowded area of the most popular street in town, he would automatically get walk-in traffic that would spend money and generate revenue for the venue.

The biggest mantra in retail is “location, location, location”. The biggest problem with that mantra is that every single business person follows it like gospel and sets up shop. Before you know it, there are hundreds of similar retail store on one street and to survive all entrepreneurs fight it out with price wars eventually driving each other out of business.

If you’re in retail or any industry that would benefit from being located on a busy street, be careful.

Unless your retail store or venue does not have more than two direct competitors within a four-kilometer radius, you will do well. If you set shop and there are already established businesses and you have no distinct point of difference, you’re basically self-destructing.

The next time you are on the most popular street in your town, pay close attention to the stores or venue that are going under. Aren’t they surrounded by competitors who seem to be doing well? 

If you plan on opening up a venue in the nightlife entertainment industry, here’s a piece of advice that will save you a great deal of money, time and energy: figure out a concept that will make your venue stand out to the point where people who live a hundred kilometers away will drive to your destination. Your objective is to become an attraction à la Statue of Liberty or Eiffel Tower.

Simply opening up a venue and hoping to cash on the walk-in traffic is mistake that’s killed many entrepreneurs. Please don’t be a victim of such a misconception!

In today’s new way of doing business by being super transparent to almost letting customers run a company, early-entrepreneurs are often fooled into believing the advice of experienced individuals who fervently preach against worrying about competition and simply focusing on serving customers or clients.

It’s pretty common sense that an entrepreneur should spend a great deal of time, money and effort providing the absolute quality in products or services and customer service. We all know the refrain: one happy customer will probably tell three while one unhappy customer will tell three thousand. 

That nice piece of wisdom leads early-stage entrepreneurs astray. They completely ignore the competition and then wonder where the heck their customer base or clientele went!

I heard a sad saga of an entrepreneur who’d opened a bed and breakfast in a tourist town. Her establishment became a popular destination for visitors who appreciated the warm care and cozy atmosphere. The hostess was a wonderful person who would go to great strength to make her guests’ stays as comfortable as humanly possible.

One summer, she realized that she was getting less and less reservations but the number of visitors in the tourist city was actually increasing. Obviously, she focused on her business and looked at the reasons why guests were not coming back as religiously as they did for many summers.

What was happening? It turned out that there were a number of hotels that had opened in the meantime and that other B&Bs had started providing more amenities such as wireless Internet, free rental car bookings and children care for example.

You can spoil your customers or clients, as much as you want or can it does not guarantee their loyalty to you. They have choices and sometimes, they will opt for other things over the exceptional customer service that you provide them.

Had the bed and breakfast owner paid attention to her competition, she would have noticed the changes and would have adapted accordingly. 

Seasoned succesful entrepreneurs who advise early-stage entrepreneurs to ignore competition and just focus on their project or business put them and their stakeholders at risk. 

 

The added fact that they are successful hammers the concept deeper in the early-stage business people’s brain. The latter want to model success and accept with no questions, the false advice preached by the successful business moguls.

Ignore the competition at your own peril.

In boxing match, if a contender went into the ring without having studied his opponent and just focusing on his own game would find himself in a nasty situation and would probably be ridiculed to the point where commentators, experts and spectators would say that he deserved the knock-out punch.

 What makes the situation in early-stage entrepreneurship different?

All entrepreneurs are told to write a business plan for the concept before bringing it to life. Naturally, they oblige and get working hard at it.

The first step is to seek an outline from books or the Internet through websites such as Bplans.com. Some entrepreneurs just hire the services of a professional to do all the writing.

A typical business plan outline looks like the one below:

Summary

Business concept

Current situation

Key success factors

Financial situation/needs

Vision

Vision statement

Milestones 

Market analysis

The overall market

Changes in the market

Market segments

Target market and customers

Customer characteristics

Customer needs

Customer buying decisions 

Competitive analysis

Industry overview

Nature of competition

Changes in the industry

Primary competitors

Competitive products/services

Opportunities

Threats and risks 

Strategy

Key competitive capabilities

Key competitive weaknesses

Strategy

Implementing strategy 

Products/services

Product/service description

Positioning of products/services

Competitive evaluation of products/services

Future products/services 

Marketing and sales

Marketing strategy

Sales tactics

Advertising

Promotions/incentives

Publicity

Trade shows 

Operations

Key personnel

Organizational structure

Human resources plan

Product/service delivery

Customer service/support

Facilities 

Creating the financials of the business plan

Assumptions and comments

Starting balance sheet

Profit-and-loss projection

Cash flow projection

Balance sheet projection

Ratios and analyses

Credit for this business plan outline should be given to Inc, an entrepreneur’s must-read business magazine. It’s full of awesome marketing ideas and interviews with successful entrepreneurs who gladly and generously share their early-stage journey.

If you head to BPlans.com, other websites that offer software, paid or free samples or templates or if you go through the hundred of books that show entrepreneurs how to write a business plan, the outline or format will always be more or less the same.

What’s the number one question that people will ask the entrepreneur when she or he presents the idea or completed business plan to them?
It may come in different shapes but essentially, they will ask: “What is going to make your idea work?”.

Such a question will come mainly from skeptical friends, prospective business partners and investors to mention a few stakeholders. 

This is where you as en entrepreneur will have to explain to them about your competitive plan or how you plan on getting noticed and attracting customers or clients in an already existing market.

What usually sells the stakeholders onto your idea is its feasibility. They want to know why they should invest their time, money and hope in your and your idea. I will also remind some early-stage entrepreneurs that a business plan will also sell you on your idea. It will reveal the strengths and flaws of your idea in an objective manner. 

Once the stakeholders are sold onto the idea, other important elements such as products and services, personnel and even finances become secondary details.

Why are business plans outlined in a way that strategy is not one of the first elements that readers come across?

I personally believe that in writing a business plan, strategy should be included in the summary. I understand that it cannot be a lengthy piece but a convincing paragraph to right away sell the reader onto the concept. The key success factors can then be added to prove to the reader that the idea is solid and worth pursuing.

So any business plan outline I craft will look like this (and usually, that’s the only part I write… if people are sold onto the idea, I write the other part later. That’s another article though but in a nutshell, I have found that a well presented idea can take one page and not the 40 pages or so that some entrepreneurs dedicate to writing a conventional business plan): 

Summary

Business concept

Current situation

Strategy or game plan

Key success factors

Financial situation/needs

A business plan should be more than a dull essay with numbers and promises that everyone make. It should be a sales tool that helps sell your concept onto the intended audience.

Don’t make the mistake of hiding the part about how your idea is going to take over and reach the numero uno spot. Business plan readers are smart (usually). Once they see the potential of the idea and how it can grow into something that rivals an institution, they will be more receptive to the other elements such as start-up capital needed.

Exactly, two weeks ago, Cuil the self-proclaimed “World’s Biggest Search Engine’ went live amidst great fanfare that almost matched a papal visit and within 24 hours it was the subject of great attention all over the world wide web.

Cuil had all the ingredients to become an instant hit:

Credible founders:

Tom Costello, the CEO, was a researcher at Stanford and later joined IBM to eventually become a member of IBM’s strategy team for Storage Systems Strategy worldwide.

Anna Patterson, the president, has a PhD in Computer Science from the University of Illinois at Urbana-Champaign, and was a Research Scientist at Stanford University. She also held senior positions at Google.

Russell Power, the VP of Engineering, “attended the University of Washington and is on leave there as a PhD candidate in computer science” and also served at Google.

With such founders, it was obvious to everyone that Cuil was a product developed by the best of the best.

A big and lucrative market:

Some entrepreneurs find themselves launching their concept in non-existent markets. They then face the tasks of creating the market and creating their brands. Cuil found itself in a big market that still growing and in which winning companies are racking in millions.

This market is not near its maturity yet meaning that there may be room for many players.

Deep Pockets:

Unlike most entrepreneurs Tom Costello, Anna Patterson, Russell Power did not launch their baby on a shoe-string budget but with a cool $33 million from also credible investors such as Greylock Partners (Madrone Capital Partners and Tugboat Ventures being the others).

When an entrepreneurs starts off a venture with money being the least of her or his short-term concern it increases the odds of success.

When you also have business backers who invested in other famous start-ups such as Facebook and Linkedin, you know that they consider you a surefire winner.

Publicity:

Two Mondays ago, the Wall Street Journal, the New York Times, USA Today, the Chicago Tribune, Business Week, Techcrunch, GigaOm, Mashable and even I (a nobody) wrote about this new start-up.

Let’s not even mention, other newspapers, blogs, TV news reports and social media sites. An entrepreneur’s dream if you asked for my humble opinion! 

In recent years, I have not seen an Internet company launch out of the blue and get so much publicity in one shot. The PR people at Cuil certainly know how to play the game and pulled off an extraordinary coup. Heck, someone even asked publicly: How Did Cuil Get So Much Publicity on Day 1?”

But where did entrepreneurs Tom Costello, Anna Patterson, Russell Power who founded Cuil go wrong?

How come that the keys to new start-up success backfired?

Cuil provides a unique opportunity to address the importance of strategy to eary-stage entrepreneurs and how a company can fail from the start with a flawed game plan.

Cuil’s New Coke Strategy

 At least Cuil’s founders should be commended for having a strategy. Most entrepreneurs launch their concept with no strategy whatsoever. However, having a start-up strategy is one issue, having a strong one is a whole other debate.

Essentially, Cuil pulled off a New Coke Strategy which in simple terms could be explained as fixing something that’s not broken without anyone asking for it.

“Cuil’s goal is to solve the two great problems of search: how to index the whole Internet—not just part of it—and how to analyze and sort out its pages so you get relevant results.“, says the company’s about page.

Put differently, Cuil’s premise was that normal search was broken and needed fixing. And since Google dominates the search market, it became the obvious target. Cuil’s strategy was to do the search job better.

If it ain’t broke, don’t fix it especially no one asked

The answer to the question “How to sell anything to anyone” is a simple “Make something people want to buy.”

People do not find anything wrong with Google search. The complaints of them not being able to find something they’re searching for are in the absolute minority. Furthermore, if you really want to claim that you can do a better job, do actually deliver on the promise!

Most people typed in their names in Cuil’s search bar and everything but their personal sites popped up. They tried other keywords and the results were not even OK, they were lousy! In three quick search attempts, they discarded Cuil. The problem is that such people were mostly industry luminaries who would have given Cuil, the seal of approval, legitimizing their claim and strategy.

How strength became a major weakness

Remember the perfect launch-recipe that Cuil had? With the flawed New Coke Strategy this launch actually turned into a dud. In other words, all the credibility of the entrepreneurs/founders, all the money and the publicity turned into a major liability.

At the end of the day, Cuil received that much publicity because the founders are big guns and so are its investors. But the press was not impressed with the concept (hence the strategy) and actually did more harm than good by calling it a non-Google killer. In other words, they told the general public “Move along folks! Nothing to see here!”.

Two weeks later and the news on Cuil are still not good. With the perceived poor search results, downtimes, the situation did not certainly help.

Cuil can certainly hang in there and hope that the opinions will change. From experience, they will not as the battle it faces is tough: 1) Actually turning its service into an acceptable service and convincing the public of such 2) Actually turning into a viable search contender.

Some people wondered if Cuil was not a project meant to become popular as fast possible and at its height be sold to a true Google competitor such as Microsoft. That may be true and is not a bad idea. But at the end of the day, buyers are not dumb and will never buy a lemon.

Anyone tempted to buy or invest in Cuil further can save himself or herself great money soliciting due diligence professional services and simply conduct a Cuil search on anything and then a Google search on Cuil. The pages that come up will make up his or her mind.

Early-stage entrepreneurs be warned! No matter amount of founder credentials, start-up capital, publicity and other resources will work against a flawed strategy. Cuil will go down in history as being a cool $33 million experiment.

A future article will look into what Cuil entrepreneurs should do now (if anything!) to save face and their company. Subscribe to the RSS to be the first to read all about it! 

Here’s a quick story. Honest, it will be.

The scene takes place a martial arts school. Practitioners tend to train according to their belt rank, meaning that the beginners train together while the high belt holders train together too. And then, there’s the division between adults, children and really young children. 

Today is competition day for a black belt holder. It’s an important one because it will determine his odds for trying out for the national Olympic team. While he gets ready, a way younger and less experienced boy only sporting a yellow belt approaches him, bows respectfully and asks the black belt if he’d entertain a piece of advice.

Other higher ranked practitioners tell off the kid asking how he dares approach the seniors and ask mockingly what a thirteen year old yellow belt can teach a twenty-five year old national champion who olds a black belt. The judo competitor, in a wise move, decides to hear the youngster out.

The yellow belt, timidly whispers to the black belt that he would be better off if he focuses on getting his opponent to the ground and using grappling techniques to score points as opposed to trying to play the typical judo game that’s all about sweeps, throws and counters.

A whistle interrupts the conversation and the black belt steps on to the mat to compete. In the first three minutes, he gets thrown around like a toy and is amazed at the fact his opponent seems to be getting the best of his moves. At a loss of his options, he remembers the kid’s advice and forces the game to the ground when he easily obtains a submission getting him a chance to participate at the tryouts.

The following Monday, he tracks down the yellow belt and asks him how he knew about the superb strategy. “I knew who you were going to fight” says the 13-year old “so one day I spent an afternoon watching all of his fights on YouTube and quickly noticed that his ground game was poor because his stand up game is always flawless that he’s never needed to work on it.”

 

Dear reader, what makes an expert?

Is it the PHD filled professor? Is it the individual who’s spent thirty years in the field? Is the person who’s spent hundreds of hours on research, observations and tests? Is it someone who’s had one lucky shot and now proclaims to be an expert? Is it someone who knows something that 99% of the rest of us do not know? Is it someone who knows something that you don’t know? Is it someone who can offer insight based on his or her failures?

The dictionary says that an expert is: “a person who has a comprehensive and authoritative knowledge of or skill in a particular area.”

Should that mean that we should discard all advice that comes from a person or source who does not meet the above criteria?

These are questions that are debates at the moment among, would you guess it, experts themselves. For instance doctors mock traditional healers and vice versa. Marketing experts disrespectfully dismiss entrepreneurs turned consultants and so forth.

Experts don’t want people playing on their turf.

My personal take on expert and expertise is that if someone has something to say, I will pay attention no matter how trivial the information seems. I leave the interpretation up to me. Some of the marketing lessons that I ever learned were picked up from people and situations remotely related to business.

For instance, I learned from a guy who was not rich and definitely not handsome, probably the most eye-opening lesson on being different. He told me that since he was not rich or handsome, he played the dating game differently by appealing to women who were fascinated by adventure.

He basically told me that he was known as perpetual traveler and his stories would appeal to people who loved to travel but did not have the time, means or freedom. After many years, he became a local celebrity whose photos would appear in many establishments. In those photos, he would be wearing a t-shirt of the store and be at the Great Wall of China for instance.

From that I realized that in business, there were many ways to be different and with consistency, a strong brand could be developed like that. That’s something that I learned in my teenage days without taking any marketing class yet!

What makes an expert?

It’s up to you. To me, it’s anyone who tells me something I did not know or help me see a situation in a different light.

After a few days of posts on early-stage entrepreneurship, maybe it would be a good idea to provide some definitions so that everyone is on the same wavelength. 

Early-stage is a very relative concept. Everyone seems to have her or his definition and measurement. 

I could commission a big research firm to go out there and develop a universal definition but I won’t. I will just provide what I understand early-stage entrepreneurship to be and how the definitions will be the focus of the posts published on How to Sell Anything to Anyone. 

Primo: early stage can refer to days, months or years. It’s what’s traditionally seen as a young or new company for example. To me, a company after five years matures. This of course conveniently overlooks the fact that some industries are slower than others. For instance, after five years, an online boutique is a grand parent while an automobile company could be still called a start-up.

 

 

The best solution will be to treat each industry individually as it comes up in a post. So for instance, a post could be written about the trials and tribulations of an early-stage entrepreneur in the airline industry on the seventh year anniversary of her start-up. We could also write about how a five-year-old company is still failing to capture market share and that the entrepreneur should consider himself in the mature stage.

Secundo: early stage can refer to the position on the food chain. My firm belief and message is that the objective of a profit-oriented entrepreneur is to become number one in the market that she or he competes in. That’s because in life, the winner takes all. Not a little. All! And number one is not good enough in my books. Those two points will be discussed in future posts.

A no-contest dominant position is what I am talking about. A Microsoft, Google, YouTube, iPod, Tiger Woods or Michael Jordan type dominance. Such a powerful lead that no one even knows who’s the runner-up or if there’s any in the first place! Al Ries and Jack Trout neatly named this principle, the law of leadership in their marketing classic, 22 Immutable Laws of Marketing.

That said, early-stage entrepreneurship on How to Sell Anything to Anyone may refer to the journey to market dominance or supreme recognition. Recognition can be a way to measure market dominance in some industries or fields. In Hollywood for instance, the most recognized actor will probably attract the most fans and will likely be the first pick on big budget movie roles and earn top dollar in the process.

To conclude, early-stage entrepreneurship can refer to the birth of an idea, turning into a business empire that eventually takes over the market. Early-stage entrepreneurship can also refer to the formative years of a company before it turns five and is considered an adult.

I should add that as the blog gathers momentum (yes, at this time of writing, How to Sell Anything to Anyone is a baby and a typical early-stage project. In the blogosphere, a three year old blog is archaic!), the definition may be revisited or updated to reflect the readership or feedback from smarter business theorists and observers.

What’s your take?