Yesterday I had an interesting conversation with a friend of mine, Neil Bobb owner of Primus Risk Management Inc., and he told me about a conversation he had with his young daughter. He was trying to show her the merits of going into business. He started off by telling her that if she could get 5000 people to give her one dollar each month at the end of the year she would make $60,000. He went to point out that after some time, people may get tired because they are not getting anything in return for their dollar. He then suggested that these people be provided with a product or service that they get value from. Now, instead of them paying her $1.00, they can pay her $10.00 for something they value. In one year she would have generated $600,000 in income. Even if she incurred running costs of $6 dollars per customer, to pay staff to help her, she would still earn $240,000 in that year.
Several things struck me about his explanation. The first is that it was very simple. Business can be complex, but at the core all you have to do is to offer a product or service that adds value for people at a fair price and you can be very successful. The crux is finding enough people to buy your product or service. Many business owners sometimes get frustrated and bogged down with the administrative and logistical side of the business. These tasks can be delegated to hired staff. As an entrepreneur, it is your job to innovate and think of ways to improve your product or service so as to enhance the customer’s experience and everything else as they say will fall in place after that.
The second thing that stood out from this conversation is that you don’t have to conquer the world, at least not immediately. If you have a new business 5000 customers is a realistic target to start off with. Starting small and growing steadily is the best way to grow. In the process you build your tribe or community. In this area also, entrepreneurs are sometimes paralyzed by the amount of information and marketing techniques that are suggested for acquiring a customer. There are one hundred and one tools, strategies and advice tips. With technology comes another one hundred and one ways to reach customers. For a new business owner it can be a nightmare navigating through the plethora of information. It is not pleasant for the consumer either. They are constantly bombarded with products and services that promise to solve every problem he/she has only to fall short. From using somatic markers and psychological sleight of mind, great advertising can sell anything from substandard products to outright nonsense. I loved this top ten list compiled by Watchmojo.com.
The final thing that struck me about his explanation wasn’t one that verbally mentioned but was implied and that is the power of the consumer. If we can’t find customers, we have no business. Success hinges on finding customers for our good or service. In our capitalist system, making a profit is the name of the game and some companies seem to do so whatever they need to, to ensure they can sell their good or service. The examples in the video demonstrate the exploitative and deceptive nature of capitalism. We cannot ignore, however, that capitalism drives constant innovation, which greatly benefits consumers. When firms compete to get our business they have to make genuinely better and cheaper products. Companies can only get away with this type of brainwashing or brandwashing for so long. At some point the consumer will realize the truth. Unfortunately, some companies have been doing such a great job that even after 125 years, consumers still haven’t caught on!
Businesses need to start thinking of consumers as cooperative partners. At the end of the day once you provide value to the consumer they will happily pay you for it. Each customer is a treasure. Businesses that want to be successful have to value them. They can demonstrate this providing their consumers with the best product or service that will help improve or enhance the quality of their lives. The successful businesses are the ones that treat their customers as cooperative partners in their success. Here both sides benefit. The consumer benefits by getting a great product or outstanding service and the business benefits by having a loyal customer.
Most consumers don’t realise the power they wield when they go into the world. Without the consumer, there can be no business. Without the consumer, there can is no money to be made. Consumers’ spending is what drives the economy and allows businesses to grow and flourish. As a business owner, you need ensure that you treat your consumers fairly. It is the best way to develop trust and loyalty that will help your business grow and prosper. As a consumer you have tremendous power to force business to provide good quality goods and services. There was once a time that consumer had limited avenues to effect change. This is no longer the case. Consumers today literally have the power in the palm of their hands. Social media is the platform where consumers can discuss products, give reviews and make suggestions for improvements. It is a place for honest discussion. The only way you as a consumer can make a difference is to speak up, get involved and take action. Consumers have a real outlet for being heard and those businesses who truly have the consumer best interest at heart are the ones taking notice.