Just because you're stuck at home doesn't mean you can't make progress with your business idea, writes Te Herenga Waka—Victoria University of Wellington’s Dr Mary Ellen Gordon.
You have a great idea for a business. You’ve been working to get it up and going.
Then, just as you were starting to gain traction, the entire country and much of the rest of the world are locked down to wait out the coronavirus.
But just because you’re stuck at home doesn’t mean you can’t make progress with your business. In fact, as long as you’ve got a computer with an internet connection, you might be able to end the lockdown in a better position than without it.
You can access a vast amount of information about potential customers for your business without needing to leave your bubble. You now have time to carefully analyse that information and make strategic choices and contingency plans to implement once the lockdown ends.
Here are eight steps to help you use the next four weeks productively.
1. Identify potential product/service configurations.
Even though you may think you have an idea, most products or services could be created using multiple configurations. For example, like the plane trips no one is currently taking, most products and services can be configured either in a very high-end way with lots of bells and whistles, or in a bare-bones economy version, or in some middle ground between those extremes.
Products could be sold through an e-commerce platform or physical stores; services could be delivered from central premises or at customers’ homes. What are the potential options for your product or service?
2. Identify potential markets and segments.
Who do you think might want to buy your product or service? Identify these possibilities both by countries and regions, and by segment.
The segments could be defined demographically—for example, people who are under a certain age or have incomes over a certain amount—or based on what’s important to them—“foodies” who value spending time and effort cooking versus people who just want to be fed quickly and easily.
3. Get a rough idea of the size of each of the resulting combinations.
Each combination of a potential product/service configuration and market/segment is a potential business opportunity for you. Obviously, you can’t take advantage of all of them immediately, so it’s a good idea to get a rough idea of their relative size.
You can get a lot of information on the number of people in different geographical areas, of different ages and incomes, and more through Stats NZ and similar organisations in nearly every other country. Searching for census and the country name is a good way to find them.
There are typically a variety of industry sources that can help you further narrow things down, from the number of people in an area to the number of people who might buy your product or service. Try searching for the product/service and “market” or “industry” and country name. It may take a time to poke around to find exactly the most useful information for your business, but one thing you do have right now is time.
4. Get a rough idea of the growth rate of each of the resulting combinations.
Doing the type of search previously described can also help you estimate the growth rate for potential product/service and market/segment combinations since, all other things being equal, you would like to focus on markets that are both large and growing.
5. Get a rough idea of the relative lifetime value of customers in the combinations.
As you read through the information you are finding, also try to get an idea of the lifetime value of customers in the different combinations. Customers who buy things at regular intervals for years can be much more valuable than one-time buyers or those who continually switch around looking for the lowest price.
Prices can also vary by market, making some more attractive than others. Searching e-commerce sites is a good way to get a sense of prices for different products in different markets.
6. Get a rough idea of how well each combination fits with your skills and resources.
By now you should have a good idea of which product/service and market/segment combinations seem like the best opportunities in a generic sense. However, in reality, different people and businesses have different skills and resources available to them. That means that some will be better placed than others to take advantage of an opportunity. Which of the best generic opportunities are also best suited to your particular skills and resources?
7. Use the results of steps 1–6 to rate each combination.
You should now be able to identify the product/service and market/segment combinations that seem like the best opportunities for your business, based on what you know now.
8. Focus customer acquisition efforts and product development on high-priority areas.
Start at the top of the list with your highest priority product/service and market/segment combinations and begin planning your next steps. What do you need to do to get your product or service ready to meet the needs of that group of people? How will you make them aware of the product once you’re ready to do that?
Of course, we’re in a time of unusually high uncertainty, so also think through contingencies. This means going a bit further down your priority list so if, for example, customers in a given country remain inaccessible for a long time, you also have a plan for focusing on a different market—maybe the domestic one—in the shorter term. Also be prepared to update your analysis and priorities with new information as it becomes available.
It may feel frustrating to not be building your products or talking to potential customers today, but using this time to go through this approach should give you the information you need to make choices that will serve your business well far into the future.
Dr Mary Ellen Gordon is a Senior Lecturer in Te Herenga Waka—Victoria University of Wellington’s School of Information Management, with expertise in data and how it can be used to support business growth.
Read the original article on Newsroom.