Transcript
Hi, everyone, and welcome to another video. Today we’re in our coaching series, and we’re going to be talking about MVP and staying in your niche.
Now what does MVP stand for? Well, it doesn’t stand for most valuable player, go doggies, but it does stand for something very important in business and that is minimum viable product.
So the minimum viable product is all about focusing on a single product or service, lasering in on that, and only doing the absolute minimum to get your business started. And this is a key part of starting fast and getting into business.
Key Components for Selling a Single Product
So what do you need to successfully just sell one single product or service?
Well, at a minimum there’s three separate areas. There’s client acquisition, there’s the client sale, and finally there’s actually going through with your promise and that’s the client service.
But unfortunately of course it’s not that simple. There are many, many more facets. So let’s break them down a little bit further and have a look.
Client Acquisition Strategies
In client acquisition, first you have to find your customer, which obviously means you need to know your customer, you need to find the market they’re in, and then you need to find a marketing channel that will actually talk to these people and find them for you. You need to then actively market to these people in a way that doesn’t annoy them and brings them closer to your business. This isn’t a sale yet. This is purely marketing.
You then need to lead them into your sales funnel. Some people have very simple sales funnels that are simply find the client, get the call, get the booking, or sell the product. But a lot of products and services need more complex sales funnels than that, with a lead in, a little bit of education, and sometimes a freebie upfront to lead them in further.
So once you’ve got that client acquisition and they’re very close, you still need to physically make the sale. And that means you need to convince them that your service or product is the right one for them out of all the myriad of products that are already out there. You need to create an easy entry point for them so that they can actually make that sale.
And you need to finally close the sale in a meaningful way.
The Importance of Client Service
And then after all of this, finally we get to client service. And this is actually the least important of the three sections if you think about it. And that’s because if you can’t get a client, you can’t have a product to sell them. And ultimately that means that the service has to come subordinate to the other parts.
Of course, that doesn’t mean that we skimp on quality in this section.
So finally, when we do need to service our product, you need to provide what you promised. You need to maintain this service or product over time so that it doesn’t degrade. And finally, you need to find a way to make them satisfied so that they’ll leave good reviews and hopefully so that you can actually resell another service or product to them in the future, hence multiplying your income from that initial marketing spend. So suddenly after we look at all of these parts, one single service or product already has up to maybe ten or even fifteen unique parts that are perfect to get that perfect sale going and get your profitability nice and high. So if you only have one product or service, you already have to allocate your time into fifteen different chunks. Five-ten percent of your time can be allocated to each one of these chunks.
And of course that’s what staff are for, but that doesn’t ultimately change that everyone is dividing their time amongst so many things.
So if you have multiple products and services suddenly you can see that you are in trouble.
If you have five services, how much time do you think you can actually allocate each one of those services marketing channels, each one of those services quality, each one of those services sales? It’s just very, very difficult.
Staying Focused on Your Niche
So what I would recommend to you when you are starting your new business, find your niche, stay in your niche until you have built a strong business core. That’s when you can start looking at adding extra services and products.
Because what sounds better to you? One hundred customers buying a single service or product? Or one hundred services or products with only one client sale each. It’s a bit of a no brainer.
Personal Experience with Business Growth
Now let me tell you a little bit about my own personal experience. I was the CEO of a a reasonably large health center with multiple outlets for about seven years, and during that time we started with a few key core products that could all be serviced by a single type of staff member, meaning that if we hired one person they could service all of the products in the business.
But over time we did grow, we added services, we added new products, we had retail sales, and over time we ended up really getting a bit too clunky and a little bit too heavyweight. We started to have to have different staff for each different service. We had to have different marketing people for each marketing channel because everything started to be quite complicated. It was actually about twelve businesses in one. Now when you have a huge amount of staff this is possible, but for you as a small business person this may be completely unrealistic.
Examples of Successful MVPs
So what are some real examples of fantastic businesses out there who started with little MVP?
Well, the most obvious one is actually Facebook. Facebook started as a single minimum viable product.
The only thing Facebook did was provide the Facebook page a way for friends to connect and share their socials. All of the other stuff came later, and that’s what made them so agile in the marketplace.
But let’s get a bit more local, maybe to Australia. How about Jim’s Mowing? We all know Jim’s Mowing. Now Jim’s Mowing, of course, these days has Jim’s IT support services, Jim’s this, Jim’s that. Every time I see a new van going past, it says something new. But we all remember the original MVP, and that’s Jim’s Mowing. They started on a single hyper focused product, and they got it perfect.
Another example is actually KX Pilates. It’s a Pilates chain that only does a single thing, and that is Pilates group classes. They don’t do anything else, and that is just a wonderful business model.
One staff member can run an entire outlet because there are so few things they need to be trained on.
Another fantastic example out there, of course you all know, is McDonald’s. Now we know McDonald’s today as McCafe and McThis, McThat, but back in the day they were just a burger chain and they just sold burgers. They did it very well and one staff member could run pretty much the entire food process and do the sale as well. Very simple model originally.
Now all of these products started as an MVP, and so should you. You do not need one hundred products and services to be a great small business person, and you don’t need one hundred products and services to be rich if that’s your goal.
Key Takeaways for Your Business
So takeaways for you from this one: what is your service or product niche? Do you really understand your niche? Are you providing a product or service in your lineup that’s actually not part of your niche that’s cannibalizing your main key product? Have a think about that one.
Is everything in your business maintainable as a single system, or are you actually running multiple businesses in a trench coat?
And can a single staff member be trained only one single time and cover all of your service line up? Because this is the key to scalability. If you can train one staff member to do your entire service line up, then you can have a hyper focused training system that allows much more scalability.
The Importance of Lean Operations
Lastly, very simple question that I want you to ask yourself once every few months, can you get leaner?
Because in the small business world, there are enough clients out there. Melbourne has over five million people. You do not need to have a very complicated business to find your people out there.
A single really good niche will find ten thousand, fifty thousand, even one million customers depending on your product. Can you get leaner? So if you have any questions about your business and how you can improve your MVP, your niche, and getting everything nice and tight, please of course get in touch for some one on one coaching. And if you have any suggestions to add to our videos, please remember to send a message because we’ll always enjoy updating our content over time. See you in the next video.