Essential Business Strategies for Start-ups
BY: DYLAN MORAN ON FRIDAY, DECEMBER 30, 2016
When setting goals, large enterprises make choices that focus on maximizing their long-term return on investment, but because of limited resources, start-ups can only sustain by setting up several short-term goals and executing them with precision.
When these well-established companies enter a new market segment, it is easier for them to invest substantial amount of time and capital on marketing before the product launch, but for small start-up enterprises the circumstances are different. Their complete new business setup and product development consumes most of their resources because of which investing further in marketing increases their risk factor. So they try alternatives like presenting samples of their product to the customers first, getting orders, and then start further manufacturing.
Essentially, if a start-up seeks to build a thriving business, it needs to focus on designing specific approaches to some critical decisions before jumping in. For example, the ones listed below. These would not only help in carefully utilizing their limited resources but would also ensure that the company is heading in the right direction.
Setting three different goals for the venture:
Firstly, define the mission for your business that communicates your passion for starting it in the first place.
It can be anything from simply not willing to work in corporate setting, enjoying this new work, or providing a solution to some problems faced by our society, or even to solve personal pain of your targeted audience.
For example, the founders of BrewDog, Watt and Dickie started their own beer making business because they enjoyed making beer. Pooja Nath Sankar, the CEO of Piazza (Non-profit Organisation), created a service keeping shy students in mind who are not able to collaborate with peers and professors to get the answers to their doubts.
Once you know why you have built your business, write down your Long-term business goals which describe what outcome you expect of the venture 5 years down the line, for example, becoming a leading public limited company. But, just make sure that there’s a connection between your passions or intellectual interests and your start-up’s long-term goals.
Finally, develop a sequence of short-term goals built on one another that allow you to carry out a series of careful experiments and ultimately lead to the achievement of the long-term goals. These Short-term goals must also help in making sure your efforts are targeted to one common business objective.
Picking target market for Venture:
A business can theoretically sell its services or products to anyone from any market. But if the target audience is picked in a manner that relates closely to the mission and long term goals of the enterprise, it will naturally boost the firm’s performance.
For example, initially the BrewDog’s products were lunched in Scotland and the consumer response was very discouraging for the product. But then, they hit Sweden market without losing hope and found the ideal consumer for their product. The Pala Interactive LLC, in partnership with Leap Gaming introduced virtual sports betting business for the first time in the US earlier in 2016, but did not get the expected response, while in Europe, the same idea is very popular since over a decade with some of the most popular and the best betting sites of the industry worldwide.
For a business like this, there are several legal restrictions by government which should not be ignored if you plan to see your business earn profits. In the US for example, at present, only one state ‘Nevada’ has legalised the sports betting business. And now this marketing opportunity is being captured by a leading mobile gaming company named, ‘Inspired’ who are launching online virtual sports betting business in the US early in the next year.
Therefore, focus should be on selecting market segments which favors the business plans.
Adapting to the Changed in Consumer Needs and the Competition
Once the customer placed the order for the product, the entrepreneur’s key responsibilities shift from being a marketer to a customer retention manager. He must monitor every indication of the changing customer needs, product modifications introduced by the competitors, and new technology innovations to figure out how to improve the product quality in order to retain every important customer.
For example, one of the biggest online retailers Amazon, has smoothly entered the online markets of several countries and expertly adapted to the shopping cultures of these different regions to stand against the well-established competitors local suppliers and popular online shopping brands.
The ultimate strategy therefore is to build and retain the passion for creating a business that brings a significant difference to the consumer’s buying experience. The profits then come naturally, either in form of cash or through the long term customer value.
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