Solve my problem, please

Normally, we’re used to seeing startups looking to solve the problems of their customers.

But lately, I have realized that there is actually quite a lot of startups, who are essentially asking their customers to solve their own problems.

I typically see it in outreach emails asking me to go to a service or a product and do something specific; update something, try out a new feature or something of that nature. And it’s all perfectly fine.

But it also sends a signal that something is off; something is less than ideal. We have encountered a problem or a challenge on our end, and you, our dear customer, should ideally help us fix it.

Essentially, what you’re often communicating in this way is a shortcoming. Something you didn’t get right in the first place, and now you’re looking to compensate or perhaps even fix the issue.

You could of course argue that there is no other way than outreach to tell about new offers, features etc., and to a large extend, you would be right about that.

However, I could also make the argument that if you had a truly sticky product that your customers were so habitually using they knew it inside and out, they would find out these things themselves, and there would be little need to do outreach to already existing customers.

In summary: When your need to do outreach to your customers is on the increase, ask yourself where in your product or service, your core offering may be broken or less than ideal.

That is the problem, you should solve. Yourself.

(Photo by Michal Matlon on Unsplash)

Beware changing models

Can you start out with one type of business model and then transition to a new one without facing huge challenges?

The question is a valid one. And the answer is probably “No” in most cases. And it is worth exploring a bit further, as it’s often a topic that comes up when I meet with founders.

The issue with wanting to change the business model is that what I need and want as a founder and business owner is not necessarily the same as my customer needs and wants.

Let me a simple example from my own life as a customer:

When I order a case of wine from my preferred ‘wine pusher’, I expect it to be an interesting wine from a wine maker, I would otherwise never have heard of and at a reasonable price. Like I am used to.

I do not expect to get an offer for a wine they have produced themselves together with a chef, I have never heard of (even though it probably says something bad about me that I don’t). As I got the other day. And immediately decided to decline.

Why?

Because it broke the fundamental ‘contract’ I have with my regular supplier: You find regular wines from little known places that I can then get a good offer on. That’s the model, I have signed up for. You DON’T try to introduce your own brands into the mix, because that deviates from our ‘contract’.

Could I be more forgiving here and just try it out? Absolutely. And I fully expect that many of their customers do so. Otherwise they probably wouldn’t do it. But I think it goes to show how challenging it can be to make changes to your fundamental value proposition and business model.

I think you need to be very aware of this. Because while it may be tempting to try to change your business model to introduce new revenue streams, cut costs, increase sales, boost your bottom line or whatever, you won’t succeed in it if you’re out of sync with what your customers are expecting.

Don’t ever take even your loyal customers for granted.

(Photo: Pixabay.com)

Go for the consumer

When someone in a startup tells me that they are going for the enterprise segment, I get a ‘gulp’ feeling. In fact the only thing that makes me more anxious is if the startup is going for the public sector.

Why?

Because it can be super tricky to actually sell what you’re doing to them.

In the enterprise your user is often not the one actually paying the bills – especially for larger accounts. This complicates your sale; it doesn’t really matter if rank and file users are excited; if the person, who is going to fork over the cash doesn’t really see or understand the value of what you’re doing, it all may amount to nothing.

Best case? You can spend months and months and months closing just one sale. Worst case? There won’t be any sale despite your ongoing, costly efforts.

For public sector it can be even worse;

Take the complexity of the enterprise sale and add political layers, various discussion and decision fora that need to get aligned without any timely deadline and a procurement process where someone completely detached from what you’re trying to sell is going to decide IF and WHEN they will open up the tender process that’s relevant – and crucial – for your ability to make a substantial sale.

It can quickly turn into a nightmare. And a costly and frustrating one at that with little or no luck in the other end.

Now, I am not saying that it can’t be done. Of course it can. It’s just hard and extremely risky, and you will have to fight more than most for whatever deals you’re able to close. But once you get that done, the reward can be good as well; bigger deals, longer terms, more stability on your revenue etc.

However, I still like the consumer play the most; the shortest possible way to someone with a creditcard willing to pay for whatever kind of relief you bring to the customers pain.

To me, the consumer approach has several advantages;

It can be easier to figure out what the right product is because you can better experiment your way towards a better understanding of your future customer and her pain(s). Your user is your customer.

It can be more efficient to market and ultimately sell, because the journey to get to the individual customer is easier to map and get right.

It can be easier to at least drive trial of your product or service to give consumers a taste of what you can offer – and then deliver above and beyond, so they fall in love with your solution and stick around for more.

And ultimately it can be easier to get the satisfaction of actually having helped someone be better off because of something you did and made available. A feeling you really shouldn’t discount.

(Photo: Pixabay.com)

Customer loyalty during a crisis

A lot of people say that there is never a time as good to start a new venture as in a time of crisis.

Maybe it’s true. I don’t know. But lets assume it is. What are the things that makes it different and perhaps even better?

Normally, most would suggest that the reason it is a good time to start is that you can put pressure on the ressources you need to get going; vendors are hungry for cast and talent may not have the opportunities and bargaining power they had before.

I am not sure that goes for the tech sector, though.

But what I do find interesting is when it comes to customers and customer relationships. Maybe that’s where the real differentiator is?

When I look at my own personal spending patterns during the Covid-19 pandemic, they have largely gone one way: Down. I have cut out a lot of the day-to-day personal operating expenses – the little guilty pleasures – that I have been used to. Simply because I haven’t been able to venture out in the same way.

Now that my spending has been cut back, I am using the opportunity to assess my future spending with bigger scrutiny. I think more about what I spend the money on, and I think more about making sure that I get the value I pay for. And that I relentlessly cut out excess spending.

Case in point: I have become a cable cutter. Goodbye flow TV and big packages. Hello, select streaming services. Net effect? Minus 50 percent in cost. Per month.

I am not assuming that I am the only one who have experienced this. And let me add more to it:

It’s not that I think I am worse off than before. I think what I have now suits my needs better and more precise, and all the stuff I have cut out were things, I could easily live without.

Let’s go back towards the point about a time of crisis being a great time to start a new venture:

Perhaps it is not so much about the short term propensity towards trying to squeeze your suppliers, partners and employees.

Perhaps it is more about making damn sure that you deliver real value to your customers based on what they define as real value – not you.

Maybe it is about making sure that every single time one of your customers contemplate whether they can live without what you’re delivering, they will quickly move on to the next item on their list, because what you’re doing is an evident ‘keeper’.

If you get that out of starting a new venture during a time of crisis, I think you might just have something that will not only be able to make it through the crisis but actually thrive during and afterwards.

You’re welcome.

(Photo: Pixabay.com)

The HelloFresh test

One of the basic common rules for startups is that if what you’re working on is worth doing, you’re bound to have competition (unless you’re operating in one of those rare spaces, where you have spotted something before anyone else, of course).

With so many services – especially in the consumer space – feeling more or less alike or at the very least trying to serve the same need or solve the same problem, you need to ask yourself, what the differentiator between success and failure is going to be.

There are quite a lot to choose from, but one of the ones, I increasingly believe a lot in is the end-to-end Customer Experience, i.e. everything from the smoothness of using the product and get what you need to the overall feel of the entire experience.

If you want to learn from the best – or those believed or rumored to be the best – there is only one way to go about it: To try the service out and see for yourself.

For that reason I have made a personal decision:

I am going to be trying out a different services in quite crowded consumer spaces over the coming months to get a sense of how those that get singled out for their Customer Experience and their ability to execute ruthlessly against it actually work.

I have already signed up for the first one: HelloFresh.

HelloFresh is rumored to be a cutthroat business that are very good at executing flawlessly in the crowded meal kit market.

They have just entered the Danish market, and I have signed up to give it a spin. The Danish meal kit market is super crowded with all sorts of services, and I have previously tried a few without being overly impressed.

So I am very curious to see, if my experience with HelloFresh is going to feel any different – if I can FEEL the execution. And what – if anything – I can learn from it to bring to the other things I am working on.

Because, yes, it always pays to get inspired from other industries for what you’re trying to succeed with yourself.

I will keep you posted on what I learn.

(Photo: Pixabay.com)

The Nirvana of Netflix

The new policy of Netflix to automatically cancel accounts that have been inactive for a long period of time is worth applauding.

Everybody in the subscriptions business knows that what you really want is for customers to get into a subscription and then – hopefully – forget about the ongoing billing relationship, until the credit card expires.

But that’s the wrong way to think about it.

The right way to think about it is to put customers first in everything that you do, deliver a stellar experience that really goes above and beyond what customers are expecting leading to more and more usage.

When you do that you will know that you have done whatever it takes to deliver value to your customers and keep them happy. You can do nothing more.

When some customers are then still not using your service, you will know that it’s not because of you but because of something in their lives.

If you get to that moment the last great thing you can do for them is to send them out with a big hug and a kiss and just offer to cancel their account. No questions asked.

It is the last step to customer loyalty heaven. But – and this is important – it takes a killer product with superior service to get to that position.

Netflix has that.

What an example!

(Photo: Pixabay.com)

Fan of fans

Back in 2008 me and my present boss had a great dialogue back and forth about a concept, we called “Fan of Fans”; the idea built in Kevin Kelly’s 1000 True Fans post that if you could muster enough dedicated fans, you would have the foundation for a solid business.

We bought the domain and discussed it at length, but we never followed through on it. I am not the one to say what could or could not have been, had we put in the extra mileage. But what I can say is this:

(1) The whole idea is coming back with a vengeance post Covid-19; we’re done with mindless, senseless, cheap junk. I admit, it is a prediction, but I really believe in it coming true.

(2) The idea is going to be core to a new project, I am working on, and which I very much hope, I will be able to announce very soon (aka within weeks rather than months).

Why? Because fans are important. They matter. More than anything, really.

When you have fans, you have desire, you have something other people want. Otherwise; why would they be fans, exactly? Why do huge arena concerts with big names sell out (in normal times) in minutes after tickets are being put on sale?

With fans you have a source of revenue as those desires have a tendency to be transferable into good ol’ cash. I am a big fan of LEGO. Ask my girlfriend how much LEGO I have and still buy, and how much LEGO Friends my two girls are swimming in?

With fans you have your “Why?”, your purpose. With fans you’re never in doubt as to why you are there – and what is expected of you in terms of performance and behaviour. They’re extremely vocal.

And with fans you have stamina for the long haul. I have been a fan of Blackburn Rovers Football Club for almost 30 years now, and even though we fans have been dragged through the mud, to hell and back again, we’re still there. Because that is what it means being a real fan.

Working with fans can be daunting. But it can also be easy. If you treat them as fans and realize that just as it is in business in general, the fan is always right.

Always.

(Photo: Pixabay.com)

Deliver on the dream

I often talk about the need to meet with customers and understand what their needs are. But I also often struggle in getting through with the message of what the real potential of doing so is. So let me try it a slightly different way.

When we sit down with potential customers, or we visit them in their natural environment, we get a chance to ask questions and – most importantly – listen. And when we listen, we get an opportunity to uncover the dreams of our customers.

Dreams are funny. They are for many people characterized by three things: First of all it is something we would really like (to happen), second the acknowledgement that I am not there yet and it is out of reach and third a lingering idea that maybe it will stay a dream forever.

Tuning into the dream will give you the same three things to innovation on: A clear desire, an opportunity to be relevant and – following from that – a chance of creating an epiphany moment for them that they will reward by not only buying, what you have created, but also staying loyal to it. What’s not to like?

(Photo: Pixabay.com)