What are you really in the business of?

Just sit on that question for a second. What are your really in the business of? ...

After you've had a moment to think about your answer let me suggest something. If any description of your product was in your answer then you aren't thinking about this correctly.

That's because what you're really in the business of is delivering value to your customers not selling them a product. I know that sounds very business school but let's take a hypothetical example and you'll see what I mean.

Let's imagine you've developed a solution that will help car fleet managers reduce the maintenance cost of their vehicles. In customer conversations, most entrepreneurs will spend the whole time talking about how their software can predict the optimal time to change vehicle brakes, how it can reduce the mechanic's labor hours, etc. That's all great and I'm sure they're very impressed. The most critical part of that conversation however should sound something like this: "I have the ability to generate $1MM in savings for you Mr. Customer. So the question is, how much would you be willing to pay me so that you can save that $1MM?"

If a customer comes away form a conversation with you and the only thing they're thinking about is how your product makes scheduling maintenance easier or how this helps the accounting department create more accurate budgets for next year, then you've totally missed out on the real opportunity. How much of that $1MM do you think a customer could justify paying? By comparison, how much do you think they'll pay just to make scheduling vehicle service or budgeting maintenance costs easier? You're not selling the real value. As a result, more successful, better funded competitors will emerge. In fact, I bet you they'll even have an inferior product but they'll leave you in the dust because they understood what the real value was that they're selling. It happens all of the time.

So how do you avoid this fate? First, put yourself in the customer's shoes. You're a fleet manager. Who do you report to? How is your performance measured? What are your top priorities? What can you do to make yourself look like a hero? What things are you willing to spend real money on? The cool tech that makes your life a bit easier or the solution you can justify a big ROI on?

You're not selling that fleet manager a software package for vehicle maintenance. You're selling them $1MM.

James Shomar
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