We've all been in a spot in our business where we're trying to work out how to get from A to B or how to get to the next level. But what is the next level? How many levels are there?
Luke Fatooros from Ideas Into Business shares with us the 7 steps to building a smart business engine to give you time, money, and freedom.
Play and listen to the podcast below or scroll down below to learn how you can optimise your niche, the second step to having a smart business engine.
2. Optimise Your Niche
Luke: There are lucrative niches, and the money is naturally flowing into those lucrative niches. The common mistake is when we have meat; we try to sell it to vegetarians. It doesn't matter how fancy your meat is; a vegetarian is just not going to buy your meat. That's not a lucrative niche for your product.
My philosophy is to just follow the cash. What you want to do is you want to find customers who buy from you the quickest and the easiest.
Out of 100 customers, there will be some of them who will buy from you instantly—they love you and your brand. I call these your real customers.
I think this is where a lot of marketing companies get things wrong. They all say that this is your ideal customer, but that doesn't mean those people are actually going to buy from you. When you've been in a business, or you've been trading, and you look back at your history, you see that there's a group that just hands you cash. Shift your focus toward your real customers, not your ideal customers.
I analysed why we struggled for 14 months with my first business. My business partner, Gary, was an engineer, so we thought we could do computer programming. We're going to write software to help businesses become efficient and more profitable. We thought this was just marvelous, so we took my $800 and launched the business. No one bought anything, and we couldn't understand this. We kept trying stuff, but the customers didn't want our stuff. Instead, they're looking for computer hardware. We quickly decided that we would give them what they were looking for.
We got rid of the software, and we opened a little shop in the back of some shopping centre. No one went there. We started putting the computers where people could see them. We still had a lot to learn, but we started to see a little bit of light.
If you are struggling in business, find where the money is flowing. Listen to your customers, what they are looking to buy, instead of ramming your product down their throat. Shift and sift to what the market really wants.
My first business really took off because we've shifted and sifted out of selling computer software, which was a dead niche. You can't keep flogging a dead horse, right? You have to be smart enough to move across.
Revolutionise your business technology. Turn your IT into a utility.
How do you make sure you're not emotionally attached to that dead horse?
Luke: If you are absolutely in love with your idea, that's a self-sabotaging trait, and you need help with that. My help was a hammer on my head, and now I'm very aware of self-development and problems in my own business caused by my own self-destructive traits.
The people who ultimately fail are those who will not let go of their idea. That's ego, and that is a terrible self-sabotaging pattern.
Did you fix that through reflection or having other people come in?
Luke: Yes. I went through seven years of massive self-reflection and actually understanding that you need to get help in your life. I was not mature enough. I didn't have the structure to be successful in business, even though I was very good at business strategies.
I've done a lot of self-work over the years, and the biggest thing is getting rid of the ego. That's not easy for most people. But if you can do that, you're on your way.
Is there a certain size of the market that you need to start doing that? If you've been in business for a little while, say you've got a B2B business with 100 clients or a B2C business with 10,000 clients, how do you work out the numbers?
Luke: If you've got a bit of history in your business, you can take the time to analyse your database and then categorise them into A, B, and C clients. Who are the people who are just paying you and not giving you problems? Who are the people who won't just buy from you, no matter what you do, it's just never enough? And then who are the ones who buy from you after some hard work.
It's not about percentages, time, staff, or size. It's the process. Analyse, and then you'll be fine.