strategy development process for business

Strategy Development Process

strategy development process

A Strategy development process is a framework which defines steps to develop a strategy for your business. There could be numerous objectives but strategy development process would be same. It is not a rule of thumb but it works as a roadmap for your strategy development and implementation.

Every Business needs a very proper strategy. There are many factors which decide whether the strategy is sound or not. One needs to consider many aspects for the in his strategy development process.

There is a need of many information in strategy development process.So it requires R&D, analysis, and data mining.

Here we will know about 6 steps of strategy development process. So let’s start.

Decide your objective for strategy development

Every business wants to achieve some goals. To achieve those goals one need a proper strategy. But for every proper strategy, we need a goal. This is the first and very important step in strategy development process.

Yes, you read it correctly that to make a proper strategy we need a well-defined goal. This is so because goal gives a direction to a strategy. This direction is very important for a strategy to give results.

Goals

Your business goal could be anything like: To become the category leader, to make a specific amount of sales etc.

First, you need to try to understand what is your vision & mission. Here in our example to become category leader could be your mission but you cannot achieve it unless you find out what is to be done to become the one.

After deciding what is to be done, you have to divide the same into parts. Such parts so that you can measure performance. This part is called objectives.Deciding objectives are crucial part of strategy development process,

So now you have to take an objective and think to achieve it. We always develop a strategy to achieve these measurable objectives.

Objectives

Your objective should be very specific in numbers and also it should be constrained by a time limit. If your objective is not constrained by time limit you will not able to achieve it in the best possible time. This is so because there will be many changes in the environment and you will not able to focus on that.

Specific Measurable Parts = Objective

So your objectives should be like achieving 5000 sales of product A in 6 months etc; Specific and tied with time.

Your objectives should be based on real R&D; you have to decide real achievable number for the specific timeframe.

Your objective should be more than your desire. This should be supported by your ability and wish to achieve that objective. You have to check your ability as per your current ability. Now the question arises how you will come to know your current ability, for this, you have to take out SWOT analysis.

Further, your result should have some specific numbers and a time constraint like 200kg sales of Product A or 200 emails as leads in 2 months.

In my first lead generation campaign, I was focused on getting 100 leads email via Facebook ads. I was very low in budget. As a result, I could get only 46 leads then I again change my planning and after that, I restarted my campaign. Results for that were pretty good. Planning is always watered by your experience.

See your current situation

Strengths

This step is to be performed with step one. You have to check your arsenal for weapons which can be used to achieve goals. You weapons are your strengths. This is the most important step in strategy development process. Many times one avoid this step and make a high-end strategy which cannot be handled by one.

So you have to identify your strengths. It could be anything. If you are a grocery shop owner it could be your high-quality product, or prompt home deliveries etc.

As per the definition of Strength, It is an inherent ability of a business which gives an advantage to it over its competitors.

Know Your Strength & Weakness

 

Weakness

Once you properly identify your strengths you are ready to take your research a little further. Now you have to identify your weakness and try to overcome that. You have to overcome your weaknesses as it is a very big constraint for you and very big advantage for competitors.

Your weakness could be anything like Scarcity of money, No good working staff, No proper execution of planning etc. There are many things which you will have to overcome.

Weakness and Strengths are internal issues. But there are also some external forces which affect our approaches to our goal. We can categorize them into opportunities and threat for our business.

opportunities & Threats

Apart from our weakness and strength, we must have knowledge about our opportunities and threat. To understand these we have to study about our environment. Our opportunity could be anything for example: If I am an owner of any grocery store then working couple is an opportunity for me to expand my business if I go for home delivery.

But home delivery is not an opportunity for everyone. Because to utilize any opportunity we must have the strength for the same. This is an opportunity for you if you have a strength to give home deliveries. Otherwise, it is a threat to you.

So opportunity and threat depend on our strength and weakness. We need to minimise threat or convert them into opportunity by developing strengths.

Analysing these internal (Strengths & Weakness) & external (Opportunities & Threat) factors is called swot analysis.  Swot stands for Strength, Weakness, Opportunity, Threats.

When you do SWOT analysis you can understand where do you stand now?

Correlate your SWOT analysis with your objective

SWOT - Strategy Development Process
SWOT Analysis Matrix

When you are properly done with setting your goals with a time constraint and you are also done with your SWOT analysis, this is the time to correlate both the things. You have to now decide what it will take to complete your goals. What ability or opportunity you need to reach your goal.

After reaching to the required strengths and opportunities you have to compare them with your current situation. This comparison will tell you about what else do you need in your arsenal.

There would be many situations where you will have to develop the new strength to minimise any threats. You will always have the option to convert any threat into an opportunity by developing a new strength. But every developing strength will take many resources, most importantly, time.

So here you will have to again decide on the scarcity of resources.

Now you will able to formulate a sound strategy based on all these factors. Your strategy will be a roadmap to reach your objective in a very efficient manner.

Your strategy will include many things, such as what resources are you going to use.

How will you develop new strengths to minimise threats?

How will you utilize opportunity in the best way?

Suggested Read: 4 Step to grow your startup

Implementation of strategy

Good Strategy + Good Implementation = Success
Good Strategy + Good Implementation = Success

Good strategies may fail if not implemented properly

After deciding your specific objective this is the time to implement your strategy. Making a robust strategy is not sufficient. Implementation or execution of the same, in a proper manner, is also required. fourth Step for strategy development process. This is a very crucial step to achieve objectives.

Execution of strategy of strategy is something that requires all needful resources and proper utilization of the same. As we know that our strategy execution is limited with time we need to be efficient while implementing our strategy.

Let’s take a look at what happens when execution of strategy is good or bad against good or bad strategy making:

 

Good Implementation of strategy

Poor  Implementation of strategy

Robust Formulation of strategy

A

B

Weak Formulation of strategy

C

D

If you have-

  • the best strategy in the world and a very good implementation of the same you belong to ‘Block A’.
  • the best strategy in the world but a poor implementation of the same you belong to ‘Block B’.
  • a weak strategy but a very good implementation of the same you belong to ‘Block C’.
  • a weak strategy and a poor implementation of the same you belong to ‘Block D’.

Now let’s understand what it means to be in one of the blocks. Will you survive or die immediately or slowly. And in next step, we will take about how to get the situation from bad to good.

Block A of strategy development

If you belong to ‘Block A’, you will able to achieve your goal in your desired time.

What to do now: You are in ‘Block A’, but it doesn’t mean that you can relax. Now you will have to look for any sudden change in environment. You will have to be ready to incorporate such change which is not in the scope of your strategy.

Block B of strategy development

If you belong to ‘Block B’, It means that your top level is robust and doing well. But your operation level has flaws. Your company doesn’t know how to implement this strategy.

This could be due to many aspects: low morale of employee, lack of leadership, low experience and much more.

What to do now: Many startups belong to Block B due to low experience in their field. This can be avoided by the involvement of any experienced person in your start-up or you will have to learn quickly to come closer to the field.

Many times, it can avoid by learning from others mistakes too. This is the fastest way to learn. You have to shift to ‘Block A’ ASAP.

Block C of strategy development

If you belong to ‘Block C’, it means that you are showing a good implementation skill, but you have not analyzed your environment (internal & external) properly and you do not know your SWOT. You have not done your R&D properly.

What to do now: Now you have to redesign your strategy. You have to search out flaws in you r strategy and correct the same. You also have to see whether your operational level is efficient in implementing the new strategy as well.

Before doing implementation redesigning you have to redesign your strategy and see whether your new staff is enabled enough to implement the new strategy.

Block D of strategy development

If you belong to ‘Block D’, It means that you have taken out your strategy without much research and also your operational level is not able to implement it.

What to do now: You have to take a redesigning of your strategy and also implementation skill. You have to go through strategy development process from step one.

Control on strategy formulation & implementation

You have formulated your strategy and also implemented the same. Now, this is the time for you to keep eyes on your progress. You have to analysis your implementation and strategy time to time to ensure your arrival.

You have to also take environment analysis time to time to see changes. By this you can observe new threats and opportunities, emerging in the environment.

You have to incorporate new changes in your strategy and operation level to commensurate with your new SWOT.

Repeat the strategy development process

Repeat

Strategy development process is a continuous process. You cannot sit back and relax. There will be many changes in your strategy and implementation process according to new SWOT. You have to repeat these steps from beginning in a time interval or on demand.

Conclusion

Strategy development process given here is a roadmap for your business strategy. It is advisable for you to take all kind real research with numbers. This will enable you to enhance your strategy development. Try to get realistic data as far as possible to get for you. You can assume some things, but do it in a very rational way. Don’t let your assumptions take you far from your real goal.

This was all about strategy development process for business. You can develop any type of strategy with this.

As I always say, No one is perfect so please correct me if you find me wrong. Comment below your opinion and share with us what is your strategy development Process.

Grow your start up: 4 tips to sky rocket your business

To grow your start up you need to look after it like a new born baby. You have to take care of this like your son. Your start up need some strategies to grow. We are giving you four strategies which you should use right now to grow your start up. This will sure boost your business.

Every company or industry has got its own life cycle and life span. Their life can be divided into four parts-

  • Introduction
  • Growth
  • Maturity
  • Ageing

These four life cycles has got different strategies to use. You can not apply same strategy in every stages of life. Today here we are focused on the strategies for the introduction stage of any business i.e. Start up. But first of all you need to analyse some fact so that we may use the strategies, specific to the conditions. if you are here to know about strategies for your examination than this article is not for you. This is just a practical try to arise your mind, to give idea to entrepreneur in you. You can even think about many better strategies if you have got one share with us we will evaluate it with you. Let’s grow your start up.

Focus and grow your start up

target your customer

I am not going to tell you to focus on your work. You know it better than me. Here focus means you need to choose a well specified audience. When you are on introduction stage you cannot take risk to please everyone with your product. You need to dig deeper and reach to that one customer who likely to buy your product most. You can focus on many basis like: location, Interest, Behaviours many other factors.

 

There are many benefits of this

  • This will enable you to sell your product for less selling expenses per customer.
  • You will able to please that one customer segment who needs products and treatments you have. As you will be able to identify wishes and expectation from that one customer. You will not be confused to choose your direction of development.
  • This will enable you to excel your services and products for that one customer; hence you will have a better bond with your customer segment.
  • Consumer behaviour is influenced on recommendation of other consumers. If they recommend your product or services to others it is more likely to have a sell.

So focusing on one customer group will help you to enhance your product. You can choose your customer by choosing a problem, which your product or services are solving, and evaluating who has the got the problem.

Related read:  How to choose best customer segment for your business. (This will open in new window, so can continue to read this article here).

Identify Industry key success factor

grow your start up
KSF is key to success

Every industry is has got key success factors. These factors are most likely to influence the consumer behaviour, for a company in a particular industry. This is something which is most considerable factor for any industry and every player try to excel itself in those areas. Identifying KSF (Key Success Factor) will grow your start up by straighten your competitor deception ability.

Key success factors could be anything for any industry. Or even an industry can be divided into two or more customer types and for every customer type we can have key success factor.

You need to dig deeper to reach to the perfect key success factor that is most relevant to you.

How will you identify Key success factor for your industry

You just have to correctly find the answers for these questions:

  • On what basis your customers choose over different competitors?
  • What competitive capabilities is must to compete successfully?
  • How can you achieve a competitive advantage?

To grow your start up, you must work on your key success factors. Those will lead you to a financially successful business.

Sustain Competitive advantages

What is your competitive edge. Your hand or Table?

Competitive advantage is something that you build over a period of time. This is the reason for which your customers choose you over your competitor. That’s why it is called competitive advantages. Sustainable competitive advantages will help you grow your business in such a way you never thought. It will increase growth rate of your start up.

Now how can you develop competitive advantage and grow your start up

To develop a competitive advantage, you need to work out something like at what you are best?

If you want to develop a competitive advantage you first need to identify the problem which exists in your industry, (or develop your business around this problem), and customers want a solution for that. This is something you can try to excel. By this you will win over your competition, and grow your start up.

Let’s have an example of e-commerce industry

E-commerce as startup
I will deliver it today! babe

The big disadvantage to shop online is the lead time between placement of an order and delivery. Sometime it extends up to 7 days also. One to two days are acceptable, but seven days are problem. If you are in this industry (as I am in) you need to deliver your product on time i.e. same day delivery or maximum next day delivery.

Many e-commerce operators have started the same but they charge for this from their customer. If possible, you will have to do it for free or at your normal shipping charges. Once you make capable of yourself for this, you start to advertise yourself around this competitive edge, so that customer can notice you in this regard.

You can achieve competitive edge only when you are drastically ahead form your competitor, If You are incrementally ahead this is not competitive advantage, as you cannot sustain it.

Give them a reason to choose you over your competitor, By solving their problem in a most beneficial and expected manner.

As proverb says, you have not to do different work, you have to work differently. This is the key of competitive advantage.

Capitalisation of the competitive advantage

Name and logo come into consideration, when it is about sustainable competitive advantage. Because if your name and logo is not up to mark, People will remember you service only. They will not be able to recognise you at a later date.

Suggested read: Factor affecting Business Growth [Name and logo are also in the list, find others]

Advertisement Campaigns 

We all know advertisement is very important, doesn’t matter at what stage of life you business is. But different age group require different advertising style. Here we will discuss about advertisement types, which is important to start up.

Before any advertisement campaign know the objective, a specific objective for your advertisement.  Every advertisement style will give you a specific benefit. So which benefits do you need at your start up? Answering this question will help you to find the correct advertisement style. Let’s see what could be the various advertisement objectives-

Awareness

Awareness ads in sponsorship

This seems to be most appealing objective to grow your start up. As you need to reach to the peoples, So that they may know you. This is an objective where we do not focus on any one product but we focus on our Name and Logo. We tell people about us and the type of services and quality of goods we provide.

It is a survey that a customer started to recognise a brand after its 7th to 9th encounter. It is very huge no. of encounters. So keep up good work with your branding.

Example 1

You must have seen many hoarding on the roadside, which does the same. Recently I encountered some hoardings of a hospital in Nagpur, it was new hospital in Nagpur. Hoardings contains a group of doctors who were holding the logo of hospital and nothing else. There was a line on hoarding, I don’t recall it now, but it was giving an impression that, Nagpur has got the best hospital now.

This hoarding didn’t offer any product or service, It didn’t tell about any treatment which it does, but it was just a awareness advertisement. It told people that we are in the market and we are best you can rely on us. It was starting of brand building.

Example 2

Next Good example, I encountered was of a Coaching class. It was new class; No one knows about that, there was just a photo of teacher, who was going to teach them, and there was a line on the advertisement, ‘Who can teach you better, Brand or a Teacher’. This changed the perception of many people. And it was just awareness advertisement.

This was a personal branding advertisement. He started to build brand around him. This is one of the marketing technique. We will have an article about more than 15 marketing technique with practical implication, which I am going to share with only subscriber, So don’t forget to subscribe with your email.

Lead generation

can I call you!!!

Lead could be anything, which can lead you to sales or to customer. This could be Phone No., Email, Mailing address etc. This advertisement gives you your customer contact. So that you can target and contact them in future, this may lead to the sell.

This advertisement requires something in return. You have to give some value (or promise to give value) to your customer so that, at that time they may want to communicate with you at a later date. This is the thing you can generate your lead.  You can generate lead by holding any free contests and there are many thing which you can do to lead generation.

Example 1

The best example for lead generation campaign is my appeal to you to subscribe with your email. I promise to give you 15+ marketing technique (Which I will full fill). In lead generation I am giving you back 15+ marketing techniques for your email. This is a value for you.

Example 2

You must have gone to mall. You would have encountered some people, Who are ready to give a gift for no reason. They just take your mobile no. and tell you that they will contact you with your gift. You give your no. and you started to get many promotional offers from a store you have never given your no. This is lead generation campaign.

Leads are nothing but a very easy way to reach to your customer. You can appeal in different way to buy your product from your customers. This appeal will grow your start up.

Visit to your store campaign

exhibition cum sale

If you have got physical location, then you need your customer to visit your store. You can invite them to visit. For this you can organise show cum exhibition sales. Everyone is invited, and of they love something they will buy. By letting your customer visit your store, you are giving them a demo of price range and quality of product.

if your product has got those quality then there is big chances that people recommendation will be generated for you.

People who visit your store will have an impression in their mind about you, and on meeting with their friends and family they share their experience. If positive, It will generate a recommendation and this recommendation may pass-on.

Recommendation is something which influence the consumer behaviour at the most.

Direct sales campaign

You will have to buy it!!!

This include direct marketing. In this objective, you will try to sell your product on the first impression. This could be done by direct door to door selling, telemarketing etc.

This does not focus on brand much, but it focuses on product and its quality. A marketing person tries to sell a particular product to a customer. This does not contribute much in brand building, but you will your product sold. Now your product quality and customer satisfaction will do contribution for your brand building. Direct sales may grow your start up in financial manner. You just need to consider selling expenses per customers.

This is one of of marketing technique.

Some bonus tips to grow your start up

  • Tell your customer that your work force is the pro and it is best suitable for them.
  • It’s not product you sell always. Many a times its about the services you give your customer at the time of sale and after the sale.
  • You are small, you have very limited customer base, you can pay very personal attention to your customer. You just have to remember their small things and buying habits. Small things means remember their birthday, and don’t just wish them give them very personal offer for that day only to them. This was just an example. You can do many things to personalise the shopping experience.

Remember one thing ‘If you can’t tell, You can’t sell’

Conclusion

I hope this Small guide may help you to grow your start up. Any difficulty, question or suggestion from your side is heartily welcomed. What is your start up tips for me, share in comment and we will dig deeper into it together. Just apply these tips and grow your start up and remove tag of start up.

 

Basic Accounting, Every Entrepreneur should understand

Sometimes it feels very frustrating, when we try to understand any accounting data, but we don’t know what is debit and credit. What does it mean? It become more difficult when we encounter any new document.  You will have to agree to this point that being an entrepreneur, we all should have knowledge of basic accounting.

Basic accounting is very easy to understand. It is nothing but a simple and logical process. You can trust me on this because I (writer of this article) have been being in this field for 4+ years. anyway it doesn’t make any sense if I could not get you understand about basics.

At the end of this article, you will able to understand basic debit and credit and its use. With this knowledge you will able to understand any business document having debit and credit.

So now let’s start…

Basic accounting (i.e. Debit and Credit).

Basic Accounting - outsideoneMany a times you may have encountered these (Debit and credit) in many documents of businesses. Let’s try to understand what is all these about. To understand these we can say, they are nothing but plus and minus. But wait I didn’t say which one is plus or minus. because it do not work like this. They are relative, means at any time debit could be plus or minus and same with credit. But here is the crux, if debit is plus then credit will be minus and vice versa. This means debit and credit will always be on opposite side like plus and minus. Debit will always be added to debit and get subtracted from credit and same with credit.

Now we have understood that debit and credit are two opposite side of an account. But question rises that when to use debit and when to use credit? Answer for this very simple-

You will have to divide your accounts into four subcategories. Two categories are debit and two are credit. It means two are at one side and other two are at opposite side. They are-

  • Income – credit
  • Liability – credit
  • Expenses – Debit
  • Asset – Debit

This is very logical, Income is opposite of Expense and Asset is opposite of Liability.

What is an account

Account looks something like this

Basic Accounting - outside

It has got two side credit and debit. Every accounts falls in any one of the categories mentioned above. One account contains all the transaction related to it.

Understanding basic accounting

To understand basic accounting we need to decide category of account i.e. Income, Liability, Expenses or Asset. So now let’s assume that this account falls in the category of liability, means this is a credit type account. now if there is increase in liability the amount by which liability is increased, will be written in credit side of this account. And if there is decrease in the same the amount will be written in debit side.

Let’s take an example of furniture

Furniture is our asset so it will have debit nature. When we buy furniture we add amount of the purchase into the furniture account. To add amount we write in the debit side of that account. So here furniture account will be debited. Furniture is asset for us. assets has got debit nature, and when we purchased an asset we add amount in to that account. So to add we will do debit as furniture has got debit nature.

Look at the other side of this transaction

So now let’s say we have paid cash for this furniture. It means there is a decrease in cash. Cash is our asset. Assets have debit type. So to decrease asset we will have to put amount into the credit side of asset. Now complete entry will be-

Furniture Account Debit – xxx

To Cash Account -xxx

Take this example further-

Now suppose we have not given cash but bought furniture for credit. In this case there is no decrease in cash, but increase in liability (liability to pay for furniture aroused). Now you know liability is credit type and we are increasing it. So here we have to write amount on the credit side of furniture amount payable account. Accounting entry for this will be-

Furniture Account debit – xxx

To Furniture Amount Payable Account – xxx

These examples have cleared some point given below.

Important points

  • Every transaction affects minimum two accounts. (In above example there is increase in one asset i.e. furniture and decrease in another i.e. cash).
  • For every credit there is equal debit and vice versa.
  • Point no. two can never be changed, because it is logical. Think on it.

I hope this has given you a prima-facie knowledge of accounting. Now you can use this knowledge to interpret any business document and accounting ledger.

In this series we are going to discuss about many documents reading and interpretation, Like : Balance Sheet, Profit & Loss account Cash flow statement, Bank statement and many more. So stay tune and subscribe with your email, so that you don’t miss any article from this series.

How to choose best customer segment for your business

Customer segment | targeting the best

You have to sell your product or services to very specific target customer.  One cannot sell product to everyone. This arises the need of customer targeting. You must have listened this many a times and it is true. But, how will you target to your specific customer? How will you identify them? This arise a need to choose customer segment.

For this you will have to divide your customers in segments. There are many factors based on which you can segment your customers. But how to choose between them. We need to group them and pick up a perfect group.

In this article we will come to know to answer for two questions.

  • How to group customers? i.e. segmenting the customer

  • How to pick best group for your business? i.e. choosing the best segment

If you want to know about ‘How to pick best customer group’, Just skip to the second part of this article.

Note: for this article Product includes services also, if not mentioned separately.

1. How to group customers? [segmentation of customer]

There are many factors on the basis of which you can segment your customer. We have taken 5 major factor to illustrate you on ‘HOW TO’ part. This will boost a idea in you and you will able to create customer segment on the basis of any factor. Let’s start

Location

Dividing you customer into location is very important. Location is something which tells about your reach. If you have a store than your targeted location will be that physical location in which you have your store. You should be very choosy for your location. Why? You will get answer at the end of this article.

Being a startup you can’t and shouldn’t target many locations. This is so because each and every location has got its own attributes. It is preferable to target a location which has got a good blend of attributes that you require for your business. You decide on the basis of other attributes mentioned below. They are very major factors in deciding location. Choosing a specific location does not restrict you, but it gives you time to straighten your position in market.

If you have e-commerce, then even you should be very specific in choosing business location, even though you can sell across India or even world. This is so because if you choose any location which has no much potential customer, you will be in loss, because you will be advertising wrong segment and you will not get perfect result from your targeted location. You will bear more Advertisement cost per customer. (explanation under heading ‘Justification’ in this article).

Now, how to choose a location

We will discuss this (only this) at last because all demographics mentioned here are not isolated they are interrelated and they influence all together on your decision of choosing correct customer. So let’s know about other demographics and at the end we will try to have a combo impact of all attributes. (The small workshop)

Before going further it is advisable for you to know about your product. It will have a great help in choosing best customer segment.

Age Group

Age is just a number, but not in case of business. Age determine your thoughts and needs of things or services. Let your product be anything age has got its own effect on every type of product or services. So this is very crucial attribute for customer segmentation.

If you have any doubt, let’s take an example of Jio. I agree that every age group is using jio now a day, but what about usage. A young person will use it more and consume more data. Sometimes young will go beyond 1 GB and get an additional data pack of Rs. 51. But this is not the case with old age people. They will use jio for need only. I believe and you will also agree, that a person with age of 50+ will never go beyond 1 GB do there is no chance of additional pack. One more things exceptional cases are always there.

Your product attribute will decide which customer group will use it. For instance, let’s assume you sell wheel chairs. In this case you will target old age customers. And if you are launching new song it will be targeted to young generation. Therefore know your product well for deciding age group.

Financial Capacity

Capacity to purchase is the financial capacity of a customer. Targeting customer is influenced by this factor. This attribute influence the decision of buyer to buy something. To target correct audience in this segment you have to answer this simple question about your product – Is your product a luxury or need? What is the price of your product?

If answer of question no. 1 is, ‘luxury’, than you shall target customers with more financial power. This is so because customer with more money will buy luxury. There is very low chances that customer with lower financial capabilities will buy your product even if it is in their budget.

This demographic factor is worth attention, because ‘Demand is generated when there is will and power to purchase’. Alone will to buy will never generate a demand. To make it clearer, Lets have an example of premium cars like Mercedes Benz, BMW, Lamborghini etc. Everyone wish to buy them but a few can afford. And not all but those a few create demand for these cars.

There is no need to say anything about pricing. Just remember one thing, if you are selling your product at high price, it should be valued by your customer. Otherwise you will end up losing you customer. So try to decide price according to targeted customer.

Suggested: Enhance Your business Image with these small things

Marital status

Marriage changes two lives forever. It has a very big impact on the behaviour of two individuals. Marital status is very strong influence on your product also. It is a very big customer segment.

You should further divide these marriages in their ages like just married or they are with kids and their ages. This further classification will help you to target specific customers for your business.

This is a very big segment so segmenting customer further is required. You need to Target a very specific customer in this segment. Dig deeper and reach to your perfect customer target. Examples are below-

If couple is newly married they seek for home item, mainly kitchen appliances. They also seeks for restaurants, trips, movies many such items or services.

Couples, having child(ren) till the age of 2 or 3, will not seek for holidays trip or anything like this. They will seek for day care (if both working) etc. For day care you will have to use a blend of these attributes-

working couple+parents of 1.5 to 3 years old baby+nuclear family

These were just some examples of segmentation and even small line can lead you one step nearer to your right customer. So try to dig further and deeper.

Education

Education is something which plays a vital role on choosing your customer. How educated your customer should be is depended on your product. This attribute does not affect all products but if you have something like books or any specific software which can be used by only specific educational persons.

This example was a very direct linking to education. But there are many product or services which tends to succeed in states which has got more education rate, such as; any new idea, because it is more probable that they try new things and accept new things more quickly. In this case southern state of India has got more literacy level, so they are good to try new things. (Not in every case, so take out a market research)

Educated people have got more tendencies to accept new things.

These were major factors of demographic. There are many more factor which impact our targeted customer. What is your or what are other more according to you, comment below.

2. How to pick perfect group? i.e. choosing best customer segment.

customer segment, customer target. outsideone
Demographics – They are not isolated, but interrelated…

There is no standard rule for this as it depends how these attribute influence your product. At the end it all depends on your product.

To understand this let’s take an example of Toy Store.

Let’s try to segment and target specific customer

Age: You will target children with 4 to 10 years old. You cannot target babies with the age of 0 to 3 years, because they do not understand much. In this case you will have to target their parents. Sometimes you will have to make toys which is comfortable for parents to get their baby play.

Financial Capacity: You will again target parents or children whim parents have got good financial capacity.

Marital Status: Refer age group section.

Location: If you want to have a physical store, you should search for a location where there is more population of children, with working parents. You can

Workshop on how to pick customer segment?

Every customer has got its procurement cost. It should be low, and for this we need to target specific customer segment who seems to be more interested in our customer.

Let’s understand it with an example-

You are targeting one customer segment of 100 customers for new songs. Further statics are as below.

Advertisement cost: Rs. 10000 (Same for all cases)

Let’s compare three cases-

Customer segment 1

Attributes Details
Age Group 70 people with 50+ age.
Financial Power 90 Good enough

Customer segment 2

Attributes Details
Age Group 70 people with age under 30
Financial Power 90 Poor

Customer segment 3

Attributes Details
Age Group 70 People With Age under 30
Financial Power 90 Good enough

Solution

Customer segment 1

Even though financial power of segment is good enough, but age group is favourable so in this case let’s assume 30 customers will buy over music. (We choose 30 because we assume that 27 (90% of 30) person who are able want to buy product and 3 old age person buys.)

In this case advertisement cost per customer will be Rs. 10000/30 procured customer

Answer = Rs. 333.33/ customer

Customer segment 2

Here even Age group is favourable, but financial power is not good enough of targeted segment. Here only 10 person will buy product (9 rich + 1 poor).

So advertisement cost per customer is Rs. 1000/ customer

Customer segment 3

Here age group is favourable and financial power is also good enough.  Here let’s assume worst. Not all 63 (90% of 70) but only 50 buys music. Here ad cost per customer will be Rs. 200/ customer

These examples should clear your understanding about importance of correct segment selection. This is just one benefit, there are many other benefits associated with correct segment selection.

This is idea trigger article; we didn’t discuss definitions. Because I believe, you know it better than I do. I hope this help you in customer segment. I request you to make this post interactive by posting your ideas, suggestions and questions below in comment.

 

Business Growth: 7 worth noting factors [with actionable solution]

Grow business

You want to grow your business Business growth is not one day phenomena, It is a process.This process starts when you think of your business idea for the first time. Your every moves define you. They defines, how responsible you are towards your customers and stakeholders. Being an startup you need to focus on the moves taken for customer problem. This is so because in initial stages you have limited no. of customers and for growing your business you also need their recommendation which can influence other peoples to become your customers and may contribute in your business growth. So you must consider these factor for growing your business. You consider 1/5 factor perfectly but what about other 4. Does it cost you more.

We all agreed that business growth is a process. Your every correct move contributes in your business growth. Let’s take a look into 7 factor which influence business growth.

7 notable factor affecting business growth

Name of Business

Shakespeare said “What is in the name?”, because he was not an entrepreneur or marketing person.

what is in the name?

Business name has considerable influence on business growth, and it should be according to your business idea. It should not contradict your business idea. Your business should be simple, easy to remember and as per the legal guidelines. if you have considerably big business or your name is good enough you should register it with appropriate authority of india.

There are many private players who do this work.At present register a trademark will cost you Rs. 4,500 (government fees) + Commission (It varies between Rs. 1,500 to 2,500). This Rs. 4,500 is for individuals, startup or small enterprises. In all other cases it is Rs. 9,000.

Additional advantage of registering a trademark is that ‘No company (Pvt Ltd. or Public Ltd.) can be registered with your registered name, even you are not a company.

Example of appropriateness of business name- If you have kids store than name should not be getwellsoon  shopee. It should be something which can validate your idea like: Half ticket store etc.

Tagline

With tag line you describe yourself.It can tell about many things like your approach towards problem or how you treat your customer or your priorities etc. This is the place where you can tell about your 1st impression of trust and responsibility. It is re commendatory for you to give a proper time and efforts to your tagline.

Tagline plays a very important role in business growth.

Logo

outsideone.com logo
outsideone logo

Your logo should be consistent and same in all place of your use. This will enable your customer to recognise you and trust you.

Your logo is not going to give you any extra customer but it is your identity. This is something by which you will be recognised by your customers.

It should be created with the help of professionals. Sometimes logo can tell about your thinking towards business and customers. To resemble what your business is about you should have very appropriate selection of font style and pictorial logo form.

For e.g.- for a kids store you can have a funny fonts, but not for a law firms. Think on it.

It is a request to go to a professional logo designer. Please don’t go to online logo contest websites. They holds logo competition for you. It sound good, but you may be end up choosing wrong logo type and by this you will loss your time and money both. If you are not pro, don’t try to create your own logo, because you will like what you make, but its not about you but about your customers.

Advertisement

Heights of advertisement…

Henry Ford once said “Stopping Advertisement to save money is like stopping your watch to save time”. This line is very true and it tells about the importance of the same. Advertisement is the best way to communicate your thoughts. Your ads can change the beliefs of your customers for your business. A well defined and well targeted advertising campaign may build a good customers and business image in their mind.

Remember, You must target a perfect customer segment. This will enable you to utilise your advertising budget to get loyal and proper customer. This will also reduce your per customer advertisement cost.

Advertisement and business promotion is the main and highly dominating factor for business growth strategy. But if you will consider all other factors also it will help in organic growth of business.

Convenience at your place

The convenience and comfort you provide to your customer at your place is the key of a returning customer. Primarily it is not about the product but it is about the services which customer gets when he comes to you for product. The way you treat the customer is the everything. because there are many substitute for your product but not for the treatment you give to your customer.

The same concept is equally applicable when it comes to e-commerce website, as it nothing but you store front. now you will think, how? You can serve better with these point when it comes to e-commerce website-

  1. Website loading speed- If your website take longer to load, there is high chance that you will lose that visitor. A normal user will wait only for 3-5 second, for a website to load. after that he leaves.
  2. Easiness- Is your website user friendly. User friendly means- can a customer find what he want, with ease? If yes, he will surely like you.
  3. Look and feel- Being an e-commerce operator, it is very necessary to have a good look for your website. You have to make your website so appealing and arranged.

This factor contribute in long life of business. It is a major factor in deciding whether customer will return or not. Returning customer = high business growth.

Packaging

How your product is wrapped, is very important consideration as far as brand building is concern. If your packaging is premium your brand will be considered premium. You must invest a appropriate amount of penny for packaging, as it will have positive impact on business growth. With premium packaging, you are also considered premium by your customer.

To understand it better, Just think about local grocery shopkeepers. One who gives you proper printed poly bag with premium quality is considered better when compared to one who gives you a simple poly bag. Believe it or not, Packaging plays a very big role in changing your image a it contribute into your business growth.

After sale services

After sale services, sometime overlooked, is a very crucial point to retain customers. They are overlooked because many a times a business person person finds it costly affairs.

In traditional approach sales used to be the end. But now things have changed. Consumer is also demanding better after sale services. As mentioned in ‘convenience at your place’ subheading, your product has got substitute but not your service style.

Conclusion

Business growth is a process. Your business growth strategy is not complete if you do not have these factors. They all look very simple and you take their simplicity as a reason to ignore them. They will reward you back with a higher business growth rate, if you give proper attention to them.

business growth strategy is some thing which can never be constant. and it has no start date.

small tips: you can include in business growth strategy

If possible, do the below written things-

  1. Remember birthdays and wish your customers.
  2. You can have one specific offer only for birthday customer.
  3. Who don’t want gifts, You can give the same to your good customers on their birthday or any occasions.
  4. Take feedback of product they buy. (For this you’ll need a system to remember who buys which product?)
  5. Start Home deliveries.

These were the some essential tips for your business growth Strategy. If there is any mistake or you have something amazing to share, related to this topic, comment below and share this article if you find this useful.

Power point presentation and this article contains different actions for business growth affect. you will not found things you read in this article. This PPT and article are supportive to each other.

 

E-commerce as your startup platform in India

E-commerce as startup

E-commerce is trending now a days and they are growing rapidly. Almost everyone has started to trust e-commerce platform as customer (Thanks to COD). E-commerce has got many plus points but there also many drawback for the same. In  India there are many obstacle for E-commerce as startup, but there are a also a many opportunities.

firstly let’s take a look on Obstacles in E-commerce as startup

Problems with E-commerce platform as startup

Lack of authenticity

outsideone.com
Fear of unknown

You don’t know who is your customer, and your customer doesn’t know you as well. This lead to the lack of trust in mind of customers and they try to avoid you (as unknown). this is the problem and there will be always a problem for the same.

How to minimise this problem

This problem demand a huge investment in advertisement and trust building campaigns from your side. Trust building is not a onetime phenomena, it is a continuous process. It involve many thing, from advertising to after sale services. You will have to give some extra penny in trust building, this will help you to get your loyal customers and edge over your competitors. You can build trust by delivering good product, good after sale services etc.

But remember trust building is a continuous process, your one mistake may take your customer away.

Suggested: Basics of Customer Building and Retention 

Delivery cost and time

If you have a offline store (Shop etc.) then there is no time gap between placing an order and delivering the same. Offline platform has no extra cost of courier. But this is the obvious in case of online store. You, being an E-commerce operator, will have to bare the courier cost (which you can recover from your customer). But this courier cost will increase your pricing or ruin your profit element.

How to minimise this problem

There are two options for minimizing your delivery cost and time.

first you need to hire any shipping company like DTDC, FEDEX, DHL, E-kart and there are many more. They have got some flexible plans for your need. These plans may includes a condition of price revision. If actual quantity delivered differs from standard quantity, there would be change in pricing. there is no need to mention that pricing per delivery will increase if you delivery less product than standard quantity and vice versa. To avail benefit of this plan you must have regular high sales. But what if you just started your business and sales are not up to mark than this will going to cost you little more. in this case you can go with India post. A good shipping option for startup.

Second at your very starting point of your startup when your deliveries are very limited and if it belongs to local shipping address you can go and deliver self. It will save your money to a very big extent. as and when your deliveries grow you can opt for above mentioned options. at that time you will be able to bargain with your considerable sales units.

But if your deliveries are not local you will have to pay to third party and it will cost your startup more in your initial time.

This was all about the delivery cost now what can be done for delivery time. there are a very less way for delivery time reduction. this is a big drawback in this industry. There are many customers (like me) who sometimes buys a item offline, with a little extra money because there is a lead time for delivery. if you want to reduce the time you will have spend some extra penny in this behalf.

If possible think about in-house shipping. Prepare a cost sheet with real data and compare all the option carefully.

Repudiation of contract

It happens many times in e-commerce industry that after buying item one cancel the contract at the time of delivery, means he denies to take delivery. This is the huge loss to you as you will be charged for both side of fare. There is not all customers who does that but some states in north India has got this problem more to some extent. South India is a safer place as far as repudiation of contract is concern. Don’t take my word for this take out a survey.

How to minimise this problem

To solve this issue you can have option, not to have COD but a prepaid payment option (This will not end the problem but will reduce it considerably). This may lead to some sales loss as there are many Indian who do not trust new e-commerce players. at that time you may lose your sales. Take your decision wisely.

If you want to go with prepaid payment option you need to build a trust in the mind of customer. you can do it by giving a option of order on phone also. Providing phone no. could be considered responsible by many customers, and rest depends on your talk with that person. Make a system that one customer should be tackle by one attendant throw out the process of sale.

one advise for phone calls is that, don’t be too formal with them. Also let them realize that you (or your person on phone) have material command over companies sales decision but realize them also you are not the owner. and you can’t go beyond companies policy. You will have to take a balance between both the things. This is very small thing but have a very big impact on your customers. Be smart.

Complete your promises. This is the only key for a loyal and long time customer.

These three issues are the main issues which need to be addressed on time. What issue did you encountered or you may encounter comment below and we will try to solve them in maximum beneficial manner.

Benefits of using e-commerce platform as startup

Less capital investment needed

Who needs this…

Capital Investment means money you invest in your business. This investment reduces to a big extent as you do not need money to invest in your storefront (Land, building, furniture & fixtures etc for store). If you are having a e-commerce website than you do not need to buy all these. of course you need some fixed assets for your back end (i.e. your warehouse or stock keeping place) but not for your storefront, as your storefront is your website.

This is very big benefit of e-commerce for startup. your startup, even with less money, can join industry and compete with others. This help you to reduce your fixed cost that ultimately contribute to your profit or you can take it as you one step forward to become cost leader in your industry. This can lead to a successful startup.

Global reach

Whole world is your potential customer, if you are on e-commerce. Internet has made it possible to sell online to anyone. You can get order for your product or services online from the whole world.

To make it clearer let’s take an example of two teachers for same subject. Teacher 1, Mr. Offline takes his classes in Bangalore city so his reach to his potential customers is limited to Bangalore and nearby places. But Teacher 2, Mr. Online record his classes and sell the lecture over internet. Now he can sell his lecture to anyone in world, who is interested. He takes live webinars on a regular basis also for enrolled students.

In above e.g. both teacher teach same amount of time, but one reach is limited to Bangalore and one has no limit. That is the difference. Remember world is your potential customer you need to target your customer very well (Targeting Customer)

Growing internet users

The growth of internet user in India is very fast and that’s a best part for every e-commerce operator. The online time of users has been increased considerably also (You can thanks Jio). These are the positive sign for the future of E-commerce. This has given a very big opportunity to online players.

Changing consumer behaviour

There has been a considerable change in Indian consumer’s behavior for last 10 years. Consumer are now shopping on the go (online). they just want a reliable e-commerce operator for this. Let it be From electronics to any gift item, people at least have started to go to e-commerce operator for checking the items. This scenario is also moving towards to sell rapidly. so going online is a good proposal  for startup.

Conclusion

Every coin has two side, so do e-commerce. E-commerce is a rapidly growing and future driven platform. It also has its own limitations. If you want to go with E-commerce as your startup you have to do some ground level research. Every product is not suitable for e-commerce. It is very true that world is heading towards online but you need to also see, is your current customer online? or is it going towards online with a growing rate. For e.g. Farmers, they are not online or they do not know how to use this platform for this. So opening a e-commerce platform for them is of no use now. But It could be possible with the next generation of them. So it depends on many factor.

Guys this was just an overview of the main problems (with solution) and benefits of e-commerce platform. There could many other issues also. What issue did you encountered or you may encounter comment below and we will try to solve them in maximum beneficial manner.