5 Questions to Ask Before Including Services in Your Bootstrapping Strategy

Most tech entrepreneurs these days stay away from services because investors are looking for high-margin, repeatable revenue. Service revenues don’t command the same multiples that product revenues do.

When I decided to bootstrap my startup, I never expected to be selling professional services. I quickly learned, however, that offering services tied to your product can be incredibly useful when bootstrapping. When my company started offering design and development services utilizing our low-code development platform, these services led to high-margin recurring revenue and greatly improved unit economics. These services also drove a tremendous amount of customer success.

But, service offerings are not for everyone. Here are a few questions you should ask yourself in order to determine whether services should be part of your bootstrapping efforts.

Related: 5 Reasons Bootstrapping Your Business is the Best Thing You Can Do

Do the services have good margins?

For bootstrapping to work, you need a healthy margin. At one of the companies I founded, our professional services were a necessary element of customer onboarding since product implementation was incredibly complex and not self-service.

Our professional services margin was -20%, which eroded our cash significantly. In this instance, service was not a revenue center but a loss leader — something we had to offer to secure the more valuable recurring revenue. If you find yourself in the same boat, services will never be a viable bootstrapping strategy. They could, however, be a tool you utilize to drive the rapid growth of recurring revenues.

Does the market/customer want the services?

Many products simply can’t be used by most people without a services component. At my company, we found that even though our low-code development platform could be utilized by people with minimal coding expertise, certain segments of our user base simply didn’t have the inclination to build their solution on our platform. We also discovered that even with powerful tools, many people wanted to leverage the expertise of an experienced software design team.

This prompted us to spin up a services team that could charge for design and development as an initial project and even provide ongoing development services on a monthly basis. Going this route is driving a three-to-six month payback on and marketing investment for us. Do these types of opportunities exist for you?

Related: 7 Ways to Bootstrap Your Business to Success

Can your service offering eventually be outsourced to an ecosystem of providers?

Services can serve as a bridge to help fund platform losses up to a point where outsiders can take over. Building an ecosystem can create an awesome flywheel effect, whereby participants not only become service providers but a channel for bringing in new product sales — without the expense of having to add to your own sales team.

Salesforce and Workday both did a brilliant job of executing this strategy. Ideally your product will gain enough acceptance that you can sell off your services division for additional profit.

Do services provide you with more customer intimacy and enhance your retention metrics?

A customer’s switching costs go way up when there is both a human and technological connection to your product and services. This sort of intimacy can provide a significant boost to your retention metrics and ensure predictable revenue.

Having great people to support clients can make up for early product deficiencies and create a level of trust that a pure low-touch product cannot. This is especially important in the early days of any startup’s product lifecycle.

Related: What Nobody Tells You About Taking VC Money

Can bootstrapping with services strengthen your product development?

Launching a services division also provides another benefit: the chance for you to “eat your own dogfood.” It’s a fact that when employees use their own product, it gets markedly better. At my company, we rotate core team members in and out of the professional services team to ensure every engineer feels what our customers feel. I believe this leads to product brilliance.

Now I’m not advocating you become a services company, but having a product company with a service business could stave off having to secure venture backing before your product is more mature. This can help you avoid things like dilution, a loss of control and the pressure to grow fast for a speedy exit.

As someone who’s previously founded two venture-backed startups, I like how bootstrapping with services is allowing my company to grow more thoughtfully. We have time to think about product/market fit before scaling up, we’re not pursuing growth rates that our platform can’t support, we’re making smart hires and we’re scrutinizing the ROI of all of our expenses because every dollar counts.

Additionally, we are vetting the utility of our own product with real-life customers and creating a virtuous circle of feedback to drive new features. I feel like it’s the smarter way to evolve a business like ours — building a company for the long haul versus hitting some arbitrary goal to secure additional venture capital.

There is one important consideration before bootstrapping with services: You’ll want to make sure you’re growing (albeit at a deliberate pace) and not just treading water. That’s why the above questions are something you’ll want to consider before following my lead. It’s critical you feel confident that you’ll create enough runway and customer success for your ultimate business model to take shape, while not letting services become a distraction.

By:

Source: 5 Questions to Ask Before Including Services in Your Bootstrapping Strategy

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Critics:

In computer technology the term bootstrapping, refers to language compilers that are able to be coded in the same language. (For example, a C compiler is now written in the C language. Once the basic compiler is written, improvements can be iteratively made, thus pulling the language up by its bootstraps) Also, booting usually refers to the process of loading the basic software into the memory of a computer after power-on or general reset, the kernel will load the operating system which will then take care of loading other device drivers and software as needed.

Bootstrapping can also refer to the development of successively more complex, faster programming environments. The simplest environment will be, perhaps, a very basic text editor (e.g., ed) and an assembler program. Using these tools, one can write a more complex text editor, and a simple compiler for a higher-level language and so on, until one can have a graphical IDE and an extremely high-level programming language.

Historically, bootstrapping also refers to an early technique for computer program development on new hardware. The technique described in this paragraph has been replaced by the use of a cross compiler executed by a pre-existing computer. Bootstrapping in program development began during the 1950s when each program was constructed on paper in decimal code or in binary code, bit by bit (1s and 0s), because there was no high-level computer language, no compiler, no assembler, and no linker.

A tiny assembler program was hand-coded for a new computer (for example the IBM 650) which converted a few instructions into binary or decimal code: A1. This simple assembler program was then rewritten in its just-defined assembly language but with extensions that would enable the use of some additional mnemonics for more complex operation codes.

The enhanced assembler’s source program was then assembled by its predecessor’s executable (A1) into binary or decimal code to give A2, and the cycle repeated (now with those enhancements available), until the entire instruction set was coded, branch addresses were automatically calculated, and other conveniences (such as conditional assembly, macros, optimisations, etc.) established. This was how the early assembly program SOAP (Symbolic Optimal Assembly Program) was developed. Compilers, linkers, loaders, and utilities were then coded in assembly language, further continuing the bootstrapping process of developing complex software systems by using simpler software.

See also

 

This Is The State of SMEs One Year After The Pandemic, According To Facebook

This is the state of SMEs one year after the pandemic, according to Facebook

As part of its efforts to support SMEs, Facebook presented the latest installment of its Global Report on the State of Small Businesses, a survey conducted in February 2021 of 35,000 SMEs around the world to learn how the restrictions imposed to control The pandemic impacted their operations, their income, their workforce and even their medium-term plans.

Facebook is committed to supporting SMEs on the road to economic recovery by making relevant and actionable information available to companies, organizations, government agencies and the general public to find solutions that help this important sector of the economy. This is in addition to the free tools and training that Facebook offers to SMEs to support their digital transformation.

The 2021 edition of this report studies the continuing effects of the COVID-19 pandemic on SMEs. In this context, Facebook research aims to provide insights and information that can facilitate meaningful support for this important sector.

Among the main findings of the Global Report on the State of Small Businesses it was found that, in February 2021, globally 76% of SMEs were operating or participating in some income-generating activity, compared to 75% registered in Mexico. While in October 2020, according to the last installment of last year, the percentage reported in our country was 86%.

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The SME sector is the largest employer in any economy, and it plays an even bigger role in developing and emerging economies. However, access to credit is often a big challenge for SMEs. This is mainly because of their specific characteristics, especially their opacity and lack of verifiable information on their operations. Banks have traditionally used relationship lending to extend finance to SMEs, although in recent years other innovative lending technologies have also showed a lot of promise. Link to learn more about the FDFIx course and register for the public: https://www.edx.org/course/financial-… Link to learn more and register for government officials: https://www.imf.org/en/Capacity-Devel…

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Meanwhile, in February 2021, 27% of SMEs globally reduced the number of their employees, while in Mexico it did so 38%; percentage that in 2020 was higher with 42%.

In addition, 55% of the companies surveyed globally reported a decrease in their sales, compared to the same month last year. In Mexico the impact was less, but considerable with 48%; In October 2020, 64% of Mexican SMEs reported this reduction compared to their sales in October 2019.

On the other hand, 51% of SMEs globally and 56% in Mexico reported trusting in their ability to continue operating for at least six months if current circumstances persist.

Regarding future challenges, both globally and in Mexico, 19% of SMEs surveyed in February 2021 (33% in October 2020 in our country) anticipated challenges related to cash flow, while 24% foresee challenges related to demand or lack of customers.

Entrepreneurship and women

Regarding the statistics that show the disproportionate impact among Mexican SMEs led by women, compared to those by men, it was observed that:

  • 73% of women’s SMEs are in operations, compared to 76% led by men (84% versus 88% in October 2020)
  • 52% of women’s SMEs reported lower sales in February 2021 compared to the same month in 2020 (prior to the COVID-19 pandemic), compared to 48% of SMEs run by men.

https://hamyarminer.org/?rf=14972

As the pandemic enters a new phase with the reduction of restrictive measures, it is important to understand what are the most important challenges that SMEs face on the road to economic recovery.

Entrepreneur en Español

 

By: Entrepreneur en Español / Entrepreneur Staff

Source: This is the state of SMEs one year after the pandemic, according to Facebook

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How Entrepreneurs Can Use Data Aggregation to Grow Their Business

One of the rising tech sectors today is data aggregation with many millennials coming to the forefront of the industry to bundle information and convey it in a summary form.

Aggregating is all around us

To fully understand what data aggregation is, let’s look at this example: Data-collecting companies, like Facebook, gather intelligence such as likes or page-visits users consume. This information is carefully organized to promote ads or document what users see in their feeds. In business using behavior metrics such as the number of transactions, or average age of the consumer, helps the company focus on bestsellers. 

Related: Opportunity For Startups in Manufacturing, Logistics and Supply Chain

What does this mean to the average entrepreneur? Using these kinds of systems can pinpoint and increase productivity to boost sales and growth

Related: [Funding Alert] Healthtech Start-Up Innovate Raises $70 Million

Dollars for data

Vasiliy Fomin is an excellent example of someone currently cashing in by way of running a data aggregator, bundling information from various sources into a single API, and allowing all types of businesses to power their offerings to consumers. He’s been able to build a thriving business earning millions in revenue by selling aggregated vehicle data, arrest record data, and more to a network of qualified resellers. 

For entrepreneurs, research and development are essential in understanding the market behavior so as to provide the best services to their customers. Data aggregators embrace innovations, new ideas and critical questioning by syncing with the industry’s changing trends in various aspects like leading, hiring, retaining and technology.

Related: 4 Ways Businesses and Consumers Can Take Back Their Data

By: Luis Jorge Rios Entrepreneur Leadership Network Contributor

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More Resources:

How to Create an Editorial Calendar for Content Marketing in 5 Easy Steps

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5 Last-Minute Ideas for a Successful Small Business Saturday

Small Business Saturday is an American shopping holiday that celebrates small businesses and it happens every year on the last Saturday of November. Founded in 2010 by American Express, Small Business Saturday is a great way to promote your small business because unlike other popular shopping days like Black Friday and Cyber Monday, you don’t have to compete with the big guys. 

So, it’s important that you take advantage of Small Business Saturday this year if you want to attract more shoppers to your business and generate more sales. But, how can you stand out on Small Business Saturday and grab the attention of shoppers?

Check out these 5 ideas for a successful Small Business Saturday. 

1. Put up signage

If you want to have a successful Small Business Saturday this year, first you need to remind your customers of the shopping holiday. So, be sure to put up signage in your small business weeks before the big day to inform shoppers and get them excited about the event. 

American Express even offers customizable free signage and marketing materials like decals and posters you can use to promote Small Business Saturday to your customers.  

If your business doesn’t have a physical location, you can “put up signage” on your website. Make sure to display your Small Business Saturday promotions prominently on your homepage and consider creating a dedicated landing page for Small Business Saturday deals. 

2. Create an email marketing campaign

Email is one of the best ways to stay in touch with your customers—and it’s one of the best ways to promote your Small Business Saturday deals too. With email marketing, you can send your subscribers an invitation to your Small Business Saturday event straight to their inboxes. In the email, tell customers how much they can expect to save, and use words that create urgency like “don’t wait,” “one day only” and “don’t miss it.”

3. Use social media and relevant hashtags

Your audience is on social media. In fact, according to Oberlo, 90.4 percent of Millenials, 77.5 percent of Generation X and 48.2 percent of Baby Boomers are active social media users. So, if you want to have a successful Small Business Saturday you need to be on social media too.

Start creating and sharing Small Business Saturday posts on social media platforms like Facebook, Twitter and Instagram. To widen your reach, be sure to use relevant hashtags like #SmallBusinessSaturday, #SmallBizSat, #ShopSmall and #ShopLocal. 

4. Run a giveaway

A great way to get shoppers excited about Small Business Saturday is by running a giveaway. Everyone loves winning a prize or getting a free gift so running a giveaway will give shoppers a little extra incentive to shop at your business on the last Saturday of November. 

Your business could hold an online giveaway where users have to share your post in order to enter. This will help get the word out about your Small Business Saturday promotions faster. You could also run a simple raffle at your business or give away a free gift to the first 25 people that make a purchase. A giveaway is a great way to stir up excitement and turn casual shoppers into lifelong fans of your business. 

5. Share the story of your business 

Lastly, because Small Business Saturday is all about supporting local, small businesses, you should share your story. Sharing the story of your business will help you make connections and build meaningful relationships with your customers. 

So, let your customers know how you started your business and why you started it. You can share your story via signage, social media posts, in your email newsletter and so on. Sharing your story will help your customers get to know the person behind the company and show them why they should support your business.  

Make Small Business Saturday your own

Get ready to have the most successful Small Business Saturday yet. With these tips, you can attract plenty of people that are interested in shopping at and supporting small businesses like yours. 

By: Syed Balkhi Entrepreneur Leadership Network VIP

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5 Tips For Entrepreneurs Tco Better Serve Their Potential Customers

If McKinsey & Company insights from July are any indication, consumers have rediscovered their power in the pandemic. Due to a combination of product shortages, economic and job concerns, along with a general willingness to change their purchasing behaviors, 75 percent of shoppers say they’ve behaved differently since coronavirus began spreading. In many cases, their new purchasing habits have led to exposure to unfamiliar brands.

This is a huge boon, especially for entrepreneurs trying to disrupt a market or industry. Under ordinary circumstances, getting consumers to move away from their favorite companies’ products and services can be challenging. However, with so much general uncertainty in the world, customers have become increasingly open-minded about giving untested organizations a chance to wow them.

If your startup or small business hasn’t been ocusing on customer service, the time couldn’t be better to put on a huge customer-centric push. However, you need to make sure you have the infrastructure, protocols and tools to be certain that your brand’s first impression is nothing short of powerfully awesome.

Below are a few ways to up your game when it comes to serving current and prospective patrons.

1. Leverage tech to ensure your sales time is nimble and responsive

Your sales team can’t afford to drop the ball anywhere or any time, particularly when customers are moving so freely from one product to the next. Mixmax, a sales engagement tool, boasts the time management benefits of utilizing key sales tools which can help your sales team focus less on tedious tasks and more on prospecting. Ensure they have the resources they need to carry customers from lead generation to conversion by investing in the best tech stack for your needs and goals.

What type of solutions might make sense? If you’re focused on improving the responsiveness of your salespeople no matter if they’re working from home or the office, you might opt for higher-end telephone and videoconferencing software that integrates most forms of visual and audio communication. On the other hand, maybe you want to streamline the information your prospective customers receive. In that case, you may be more interested in adding a secure contract management system into your toolkit.

Related: How the Sales Process Has Drastically Evolved to Fit the Future

2. Centralize knowledge so anyone can be a customer-service star

Nothing frustrates customers quite as much as not being able to get quick answers to their questions. A fast way to ensure that anyone in your business can solve a client’s issues is to establish a centralized knowledge-management database that can be housed on your intranet or another piece of cloud-based software. You may even want to include a corporate wiki so employees can find any information with only one login.

By giving everyone on your team access to customer information such as buying history, touchpoints and other data, you avoid having to bounce consumers between service representatives. Centralized knowledge-management systems can also be invaluable if you’ve moved some or all of your workforce remote. 

3. Channel your inner Nostradamus and foretell customer questions

You want to make finding answers to potential questions as easy as possible for customers. In fact, according to Drift’s 2020 State of Conversational Marketing Report, 34 percent of consumers cite not being able to find the information they need online as their highest customer-service snag. Rather than forcing would-be buyers to hunt around for the solutions they want, begin peppering your site with rich content that gives them the insight they crave. It’s appealing to a lot of customers to be able to solve their own problems, and they’ll appreciate finding answers fast.

What should your content look like? Ideally, you should have a variety of content FAQs on your website. The content can take the shape of videos, written copy, images, blueprints, schematics, how-to charts or even GIFs. Whatever you feel will be helpful needs to have a home on your site. Of course, you may want a more traditional page dedicated to the biggest FAQs your sales folks and customer experience (CX) personnel hear. Just make sure your FAQs stay up-to-date and don’t become stale or irrelevant.

Related: 5 Tips to Help You Create Great Content While Working From Home

4. Stay alert on social media

Spend a little time social listening, and you may just figure out exactly what your customers want. And you’ll be in good company: More than half of companies are currently using social media listening to get real-time consumer information. To be sure, many customers will talk about what they didn’t enjoy about a CX. However, their honesty is exactly what you need to hear and read. Add social listening to your sales and marketing plan today. That way, you can respond quickly if you notice that a customer is unhappy with you or, better yet, with a competitor.

For example, you might discover a critical review of your latest gadgetry on Twitter. Treat this knowledge as the opportunity to jump in and resolve the problem. Connect with the user publicly or in private and work together to solve the issue. Most people are willing to work with companies to get what they want. And you could end up turning a disgruntled buyer into a raving fan if you’re fast on the draw, take crisis management seriously and empower your CX team to do what’s right in every unique situation.

5. Make being your customer a rewarding, one-of-a-kind adventure.

Why do shoppers rave about Apple, Lululemon or Southwest Airlines? Though their products and services do tend to be well-considered, the key to the brands’ almost cult followings is the culture. Wanting to be part of a community is a basic human desire, and certain companies have made being their loyal customer an amazing experience.

If you’re trying to develop a fierce following of fanatics who wouldn’t think of going anywhere else, consider the user experience from start to finish. Look for opportunities for you to go above and beyond expectations to make shopping with you not just a pleasure, but a must-do. You might just end up building a society of kindred spirits like BMW did with its MINI series of vehicles. MINI drivers consider themselves part of a movement and collective, and the brand promotes this camaraderie on their site. Who wouldn’t want to be part of the “in” crowd?

Related: How to Earn Your Clients’ Trust (and Keep It)

Customers are moving around like never before and into a phase of discovery. Meet them where they are, and amaze them with a CX unlike any they’ve had before. They’ll be more likely to rave, not to mention stick with your organization for the long haul.

By: https://www.entrepreneur.com/

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Kimberly Ann Jimenez

Find clients for your service-based business! In this series, we’re covering how to launch, grow and scale your online service business. 💸💸 ***Join The Early Bird List For The Savvy Online Selling Course DROP for FREE 👉 https://kimberlyannjimenez.com/earlyb… **Catch the entire series business series: http://bit.ly/2KwtZiE 💻Get My Best Work In One Place (And 30+ Business & Marketing Courses) Inside The Business Lounge: http://jointheblounge.com Get in-depth, practical examples of today’s episode over on the blog: https://kimberlyannjimenez.com/2019/0… 📺 WATCH MORE ONLINE BUSINESS TRAINING VIDEOS: http://bit.ly/2KwtZiE ▼ GRAB THESE FREEBIES Learn How To Sell More On Your Blog Via My Brand New, Free Masterclass: https://kimberlyannjimenez.com/blog-c… The Online Success Path, a step-by-step guide to launching, growing and scaling the profitable online business you’ve always dreamed about: https://kimberlyannjimenez.com/succes… How To Start A Blog Playlist: https://www.youtube.com/watch?v=PAgJg… Learn Content Marketing Playlist:https://www.youtube.com/watch?v=l5gui… ▼ NEW AROUND HERE? START HERE. Run Facebook Ads On A Budget: http://bit.ly/mystrategyforfbads 5 Steps To Start An Email List From Scratch: http://bit.ly/2wgV8hT 6 Stages Of A Successful Online Business: http://bit.ly/2x5CTsR ▼ MORE RESOURCES Don’t forget to subscribe to our Podcast! : https://kimberlyannjimenez.com/podcast/ Come on over and join The Business Lounge’s FREE Mastermind Group: https://kimberlyannjimenez.com/master… Learn to launch, grow or scale a profitable online business without spending thousands on a business coach. It’s my best work in one place. http://jointheblounge.com ▼GEAR I USE: Main Camera Beast: https://amzn.to/2ALA2fQ Buttery Wide Camera Lens of Life: https://amzn.to/3bN9K9N My Favorite Studio/Portrait Lens Ever: https://amzn.to/2WOGcEt Crispy Lucious Microphone: https://amzn.to/2zekiBx Softbox Light For Glowy Skin: https://amzn.to/2XhPE2l Most Reliable Tripod: https://amzn.to/36d2NOa Most Versatile Tripod: https://amzn.to/2XckysF More recommended gear for any kind of budget: https://kit.co/kimannjimenez ▼ FOLLOW ME ON SOCIAL Facebook: https://www.facebook.com/KimAnnJimenez/ Twitter: http://twitter.com/kimannjimenez Pinterest: http://pinterest.com/kimannjimenez Instagram: http://instagram.com/kimannjimenez

Market Alignment With Segmentation and Differentiation

This is the second in an exclusive series of articles from Total Alignment authors Riaz Khadem and Linda Khadem titled “The Alignment Factor.” Check back in every Thursday for new installments. 

Businesses small and large are being impacted by the pandemic, and entrepreneurs are not immune. In order to survive and prosper during these difficult times, it might be necessary to reinvest in your business concept and redesign your offerings.

As a successful entrepreneur, you have been aligned with your market, but are you still aligned? Do your customers need the same things as before, with the same mode of delivery? For example, imagine a previously successful restaurant that has lost its customers during the pandemic. Does the owner truly understand the current needs of his customers beyond the menu it used to offer or the ambiance it had created before? 

Related: The Alignment Factor’: The Keys to Internal Alignment

What Is Market Segmentation?

In a nutshell, it’s grouping heterogenous people into homogeneous groups, or segments, by some criteria related to their needs. By defining a segment and focusing on the needs of that segment, and aligning products or services with those needs, you have taken steps toward market alignment. The key characteristics of a market segment could be similar customer needs or preferences. In a company with multiple locations, a segment will likely account for geography, demography and choices people make, the type of services they value and the quality they expect. In a smaller company, it could be a subset of these criteria.

Let’s look again at restaurants. Assuming the wearing of masks is a pretty universal requirement, the first pressing issue for owners is how to proceed over the next few months. Should the restaurant continue to offer inside dining? If so, how do you protect the customers? Usually, this is met by distancing the tables farther apart, requiring the servers to wear masks and hopefully the kitchen staff to wear masks and gloves. But what about the substantial number of people who now want to-go meals? Should they be forced to walk into a restaurant where people are eating (obviously without masks) to pick up the food? Or, more conveniently, can the restaurant offer to bring the food to the car? What about payment? Does the customer need to enter the dining room and present his credit card? Or can they pay over the phone or on the website when ordering?

These issues are not unsolvable, yet many restaurants seem unable to adapt. Perhaps it is a rigidity in the way the owners see their establishments and an unwillingness to re-evaluate the new needs of the market segment they were serving. It’s crucial to re-evaluate your customers and perhaps re-segment your market in line with the new reality. Otherwise, precious resources can be wasted on activities that are no longer in alignment. Flexibility and creativity at this juncture can mean the difference between success and failure.

What Is Differentiation?

After re-defining your market segments, you will have to identify what is important to customers in a segment likely to buy your product. Value drivers could be cost, quality, features, safety, buying experience, after-sale support, etc. In a restaurant, they could include the cost of items on the menu, the quality of the food (e.g. organic or not; using meat and poultry and sea food from sources that care for the animals well in a healthy environment), the variety in the menu, safety in the process of acquiring the food and eating, the restaurant experience and treatment received after the service is completed.

For each segment, evaluate the importance to the customers of each appropriatevalue driver on a scale of low to medium to high. For example, quality might be high for a segment while cost is a medium. Safety could be high, and follow-up support could be low. The evaluation should be based on data, not just opinion. You may need to use customer surveys to hear the voice of the customer.

Next, evaluate the same value drivers in terms of how your offering is different from your competitors. For example, is the quality you offer significantly better than your competitors? Is the cost you offer substantially lower than your competitors? Are the features you offer unique to you and unavailable to the customer from other suppliers? As you evaluate your value drivers, you can assign a low, medium or high rating to each. For example, if your value driver is features, and you offer unique features no one else is providing, your differentiation would be high. If everyone offers the same features, then your differentiation is low. Again, the evaluation should be based on data. 

After evaluating your differentiation on each of the value drivers, you have a set of two evaluations for each one: The first is how important the value driver is to the customer in a segment, and the second is the differentiation of that value driver from your competitors. You can plot the two evaluations on a two-dimensional grid, the scale being low, medium and high on both axes

The value drivers that fall in the (High:High) category should become your primary focus, both in terms of the message you send to the customers in that segment and in terms of making absolutely sure that those value drivers are perceived by your customers as you promised — or even better. For example, if quality and safety have been evaluated as (High:High), your resources should be directed toward making sure your customers are aware of your differentiation and that your quality and safety are, in fact, at the highest possible levels.

Strategies for Each Segment

Your market segments don’t all deserves the same attention. You could close out some segments and put your investment into others, especially during these challenging times. As entrepreneurs, you will have a preference based on emotional attachments. This is dangerous, as your pet offering might not be appropriate for all segments. Having re-segmented your market during this pandemic, you are in a position to decide where to put your energies and investment. You will have to choose the segments to grow, those that could stay at the same level of growth and those you should exit.

How do you make such decisions? There are guides in the management literature to help you do this. Essentially, for each segment, you perform a two-fold evaluation: How strong is your segment compared to your strongest competitor in terms of the internal processes that deliver value to the customer? And how attractive is the segment to an investor?

If you are much stronger than your strongest competitor, then your strength in that segment would be high. If you are at the same level as your strongest competitor, your strength would be medium, and if you are weaker than your strongest competitor, your evaluation in that segment would be low.

As for market attractiveness, you will have to evaluate whether the market in a segment is extremely favorable, (considering a set of external criteria) or not. The external criteria could include the size of the market, the growth of the market and the profitability of the market. If the market segment is favorable, then the evaluation for that segment would be high. Otherwise, it could be medium or low. The value of this exercise is that it will enable you to see the relative position of your different segments compared to each other.

The segment with high strength and high market attractiveness (High:High) is the one that deserves your attention the most, and the segment that has low strength and low attractiveness (Low:Low) can be divested unless it provides input into an attractive segment. Other segments will require appropriate strategies based on their evaluation.

Related: The One System That Changes Employees’ Behavior

Strategic Mindset

The strategic mindset we are proposing in this article will help you arrive at a set of strategies appropriate to each of your market segments. To develop a strategy, you need to have identified your market segments, differentiation and the relative position of your segments on the business strength/market attractiveness continuum.

Choosing where to put your time and investment will be key to your survival and growth, enabling you to make sound decisions and use your precious financial and human resources to deliver maximum value to your customers.

By: Riaz Khadem and Linda Khadem Business Strategy Experts

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tutor2u 112K subscribers The STP (segmentation, targeting & positioning) model of marketing is outlined in this revision video. #alevelbusiness#businessrevision#aqabusiness#tutor2ubusiness#alevels#edexcelbusiness#businessalevel

https://www.tutor2u.net/business/reference/market-segmentation

What Employee Benefits Will Help You Retire With Confidence?

I’m sort of a geek when it comes to retirement planning surveys. I’m always looking for nuggets that are going to help people save more.

Although I know this is a perilous time for employment in general, it’s always essential to know how your employer will help you save for retirement.

“The pandemic has put pressure on the American workforce in ways few could have predicted and employees need support more than ever,” says Jonathan Bennett , head of Group Benefits at The Hartford. “Now is the perfect time for employers to address employees’ changing attitudes about benefits.”

What should you be looking for in terms of retirement-friendly benefits? Here’s what a Hartford survey found in terms of perks of “increased interest”:

  • Employee assistance programs. 
  • Student loan repayment plans.
  • Behavioral/mental health services. 
  • Wellness benefits 

While these benefits may not appear to directly put money into your nest egg, they will help you get there. If you can get help paying for college loans, parental assistance or out-of-pocket medical bills, that will certainly free up more money for retirement savings. Recommended For You

Of course it’s up to employers whether they want to boost your benefits package. If in a job transition, you can seek employers that offer these perks. If you’re staying put, though, it doesn’t hurt to ask your HR department if they can improve their offerings.

John F. Wasik

John F. Wasik

I speak and write about innovation, investor protection, employment, money management, economics, college financing, retirement and social issues. My latest book is “Winning in the Robotic Workplace,” a guide to prospering in the age of workplace automation. I’ve also written”Lightning Strikes,” a biography on the great inventor Nikola Tesla. All told, I’ve written 18 books including “Keynes’s Way to Wealth” and “The Debt-Free Degree.” I’ve also been a contributor to the New York Times, The Wall Street Journal and other global publications. I’ve appeared on CNN, FOX, NBC, MSNBC, NPR, PBS and radio stations. I’ve spoken across North America.

More Than 50 Thousand SMEs Receive Loans To Sustain Their Businesses During The Pandemic

This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process.

  • More than 50,000 SMEs have received working capital loans, with an average of 125,000 pesos each. And each venture has requested, on average, up to 2.5 credits.

Since the beginning of the pandemic, more than 15 thousand small and medium-sized companies (SMEs) found an option in Mercado Pago to keep their businesses running and 7 out of 10 who applied for a loan did so through Mercado Crédito.

The foregoing, according to a survey of 1,160 SMEs nationwide conducted by Trendsity, at the request of Mercado Pago. According to the survey, most of the resources obtained through Mercado Crédito allowed these business units to increase inventories (51%) and use it as working capital, which includes equipment and operating expenses, among others (46%).

So far, more than 50,000 SMEs have received working capital loans, with an average of 125,000 pesos each. And each venture has requested, on average, up to 2.5 credits.

“As part of the economic reactivation, credit has become essential to encourage the economic development of entrepreneurs. For that reason, we increase our offer every month and have placed more than 3,500 million pesos among SMEs so that they can get ahead in this difficult time, “said Jonathan Sarmina, director of Mercado Crédito México.

More online payments to keep trading

“50% of the SMEs that joined Mercado Pago do not have a physical store, so 65% of them chose to reinforce online sales and 55% to offer more payment options,” said Sergio Dueñas, director of Payment Market.

Among the payment methods preferred by SMEs, the Payment Link stands out (82%), followed by the payment through Mercado Pago with its own website (72%); the Point Blue card terminal (62%) and QR code payments in (49%).

He explained that, according to the results of the study, 92% of those consulted understand that offering a greater number of payment options allows them to reach more potential customers and the same percentage declares that they will continue to use Mercado Pago in a world without a pandemic.

By:Entrepreneur en Español

Trish Regan and Adam Johnson provide actionable insight on the capital markets daily with regular segments such as “Chart Attack,” depicting likely market moves before they happen, and “Insight & Action” which explains original trading ideas that can make you money. In addition, “Street Smart” is filled with breaking news, political analysis, and market-moving interviews with exclusive guests such billionaire investor Carl Icahn, hedge fund titan Bill Ackman, automaker Elon Musk and more. “Street Smart” broadcasts at 3-5pm ET/12-2pm PT. For a complete compilation of Street Smart videos, visit: http://www.bloomberg.com/video/street… Watch “Street Smart” on TV, on the Bloomberg smartphone app, on the Bloomberg TV + iPad app or on the web: http://bloomberg.com/tv Bloomberg Television offers extensive coverage and analysis of international business news and stories of global importance. It is available in more than 310 million households worldwide and reaches the most affluent and influential viewers in terms of household income, asset value and education levels. With production hubs in London, New York and Hong Kong, the network provides 24-hour continuous coverage of the people, companies and ideas that move the markets.

How to Build a Brand That Contributes to a Greater Cause

Having a greater cause behind your brand matters — not just for consumer perception of what your brand does, but for your ability to do good in the world. A social impact edge isn’t for every company, but when you give back or align your brand with helping the world, people notice. Research from Zeno’s 2020 Strength of Purpose reported that when consumers perceive that a brand or company has a strong purpose, they are six times more likely to defend or protect the company if there’s ever a misstep. They’re 4.5 times more likely to recommend it to their friends and family and become a champion behind it. 

But despite this research, Carole Cone on Purpose shared that only 24 percent of their business respondents reported having a purpose embedded in their business. And while it’s true that you shouldn’t add purpose or social impact for the sole purpose of resonating more with consumers, it is important to assess: What does my brand stand for? How do we help the world? How can I connect my profit with a greater purpose? Here are some things to consider in that assessment. 

Related: 9 Social Impact Models That Entrepreneurs Can Learn From

1. How can your product truly help others?

Sure, your product is a great help to customers — that’s why it’s doing well. But there’s a deeper consideration here. Can you extend the use of this product to those who need it most? This is similar to the TOMS model of thinking, where one pair of shoes is donated for every pair purchased. The shoes “help” the customers that buy them. But even more so, on the social impact end, they help underprivileged children internationally who don’t have shoes. 

Another powerful example of an entrepreneur using their services for good is real estate developer Christopher Senegal, who is tackling gentrification in a Houston neighborhood called Liberty Square. “Gentrification is always a sensitive topic in neighborhoods that are changing,” Senegal shared via email. “I’m facing the topic head-on. Not by protesting or trying to stop it but instead, identifying ways to be involved in the process.” At 33, he began developing middle-class townhouses in the neighborhood when he saw the development patterns in surrounding areas. 

“I realized that doing so would keep the culture of the community intact while improving the neighborhood and increasing tax dollars, which would improve schools,” he shared. “I made it a point to not only bring those that are originally from the area back from the suburbs but also only hire from the neighborhood and build a team of successful African American professionals around me. My construction team, realtors, preferred lenders, insurance agents and inspectors are all from the community.” 

Related: How Can Social Entrepreneurs Sell a Product While Promoting a Cause?

2. How can you raise awareness about causes that matter?

Your social media or ad campaigns are an ideal opportunity to show what it is that you stand for. For example, P&G created an ad campaign called “We See Equal,” which made its stance on gender equality in the workplace clear. However, they walk the talk, too — 45 percent of P&G’s managers and a third of their board are women. Make sure to put your money where your mouth is, and go beyond the ads and social media posts to show how you’re actually trying to make a difference.

Kris Ruby of Ruby Media Group recently posted an article about brand activism and how consumers are now “voting with their dollar.” Simply put, “consumers expect more from brands nowadays.” This should include actions such as using brand awareness for positive impact, participating in social movements and displaying brand values proudly on websites. 

Related: Cause Marketing Matters to Consumers

3. How can you implement social advocacy within your business model?

How you do business matters, too. Just like your ability to walk the talk alongside raising awareness is so critical, you need to make sure that every step of your business practices aligns with your purpose. An example of this is the online clothing company Everlane, which is working to improve transparency about how they make their clothes and even the details behind how they determined the prices. They do this by sharing “behind the scenes” footage of their factories and production processes, and the exact costs involved in making each piece of clothing. 

With unjust conditions in many international garment factories, a stand like this proves Everlane’s commitment to the cause and their desire to raise awareness about the right way to do things. This may seem hard to implement if your business model has already been running like a well-oiled machine, but consider little things you could do like banning unpaid internships because they’re inherently exclusive for those with socioeconomic disadvantages or ensuring that your products are cruelty-free and proving it to customers. They’re watching how you do everything you do. Prove they can trust you to abide by your greater cause.

Ultimately, these questions should lead you not to what your customers most want your brand to stand for, but what you as a founder deeply care about. How can you prove this through your business? There are countless ways — and you don’t have to be a social impact business to begin.

By: Jennifer Spencer / Entrepreneur Leadership Network VIP

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2 Vital Things You Need to Do to Protect Your Business

As the Covid-19 lockdowns went into effect, I immediately started receiving calls, text messages, and emails from clients, friends, and family members worldwide. 

The texts included questions, fears, and a consistent theme of not knowing how their business would survive the lockdown. They were stuck trying to figure out how they would pay their team, pay their vendors, and pay the rent with the business shut down. 

Many small businesses in the US have already closed permanently, with an estimated 55% of businesses closed since March predicted not to reopen again. 

Related: 4 Ways Brands Can Be Activists for School Safety Right Now

I sat down with my team and spent a few days brainstorming some actions business owners could take to give them the ability first to survive the lockdown and second rebuild a more substantial business than they had before all the chaos started. 

1. Protect your operating cash

To make this easy to understand and relatable, let us look at how humans handle a lack of resources. Humans can survive 30 days without food, 3-4 days without water, but only 3-5 minutes without oxygen. 

Operating cash is oxygen in your business. When you run out of operating cash your business chokes to death very quickly, if you want to keep your business healthy and alive, you need to make sure you protect your operating cash.

We use a very easy to understand exercise that can help you discover considerable savings in just a few hours. Since the global lockdown started, we have been teaching this to business owners worldwide, and we were able to help:

  •  A gym owner in Texas save $5,400 per month from their P&L (roughly $60,000 for the year)
  • A business consultant in Toronto saved $3,000 per month from her business expenses (approximately $36,000 for the year)
  • A midmarket firm in Amsterdam was able to save €300,000 from their expenses 

Our team named it the stoplight exercise. Imagine a stoplight in the United States; it consists of red, yellow, and green colors. Red means stop; Yellow means slow or caution. Green means go. 

Related: 4 Ways 2020 Has Changed Company Culture Forever

Part 1 is to print out your itemized P&L or your credit card receipts for your business. 

Part 2 is to comb through all of the expenses and color, each with red, yellow, or green. Red is for any expenses that you need to cut out immediately, yellow is for the expenses that you might need to keep or might need to cut out if your business starts to slow down. Green is the expense you must maintain for your business to stay alive. 

Part 3 is to eliminate the expenses in red immediately. Put a plan together for the expenses in yellow (the question below can help), and you will keep the expenses in green since they are necessary for your business to stay alive. 

Question: What specific results do we need to maintain or achieve to keep the yellow expenses? If we drop below these results, we will need to eliminate these expenses immediately. 

2. Protect your core clients

A core client is a client that you do business with regularly and consistently. They depend on your product or service to meet their own needs, and your business depends on their business to keep the door open. 

According to Harvard Business Review, Acquiring a new customer costs 5–25 times more than keeping an existing customer. And in  Salesforce’s annual State of Sales Report, it reveals 79% of business buyers agree, it’s easier than ever to take my business elsewhere. 

Related: 6 Keys for Getting Temporarily Remote Teams Back Together

A few years ago, I was working closely with one of my favorite business mentors Keith Cunningham. He proposed a question that reshaped the way I think of working with my core clients. 

He asked, “What would you have to offer your core clients so that it would be INSANE for them ever to consider going anywhere else for this type of product or service?” 

To figure this out, we must take time to get to know our core clients’ needs, wants, and desires.

A need is something that we cannot live without. If this need were not to be met, the business relationship would end immediately. 

A want is something that we can certainly live without, but we might not want to. An example of this would be the fact we need a safe place to live, but most of us want a ______ (lake house, fancy home, one with a great view, etc.) place to live. 

A desire, these are the things that call to us as we drive around town or flip through a magazine, but we could never actually justify investing the capital in getting. 

Take time to sit with your core clients and learn about their needs, wants, and desires. Once you have done your research answer these two questions:

  1. What would you need to offer to your clients that would make it insane for them ever to consider going anywhere else? 
  2. What would you need to provide to your clients to make it insane for them ever to consider stopping working with you?

By: Jairek Robbins / Entrepreneur Leadership Network Contributor

A LIVE Broadcast with Q&A on how to protect your company secrets and clients lists. SIGN UP for my weekly newsletter to download my FREE E-book “The 10 Best Tax-Saving Secrets Everyone Should Know” and schedule a FREE 15 Minute Interview with an Attorney or CPA from my team! http://markjkohler.com/youtube Also, make sure to subscribe and hit that bell icon so you get a notification every time I post a video, go live, or post an awesome tax or legal tip! For the Estate Plan Special Visit: https://kkoslawyers.com/estate-planni… Check out my Law Firm KKOS Lawyers at http://www.kkoslawyers.com Visit my Accounting Firm K&E CPAs at: http://www.ke-cpas.com Check out my personal website with all my products at: http://www.Markjkohler.com

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