You know what? I have no issues looking back at the first start-up I founded and say that I didn’t know shit about creating a business model. If you read this article, you know that I don’t like theory. I learn by doing, failing, and trying again.
The reality of your first start-up is that you might not have a business degree, but you sure are smart enough to put things together and make sense of numbers. Thinking of 2016 when I founded my first venture, I can say that with little experience, putting a business model together is a little bit like browsing on Google. You’ll end up believing in your own BS 🙊.
- Product Definition: Identify your product type, be it physical, online services, retail, social platforms, or a marketplace. Pricing and revenue strategies depend on this choice.
- Cost Considerations: Calculate not only what customers are willing to pay but also factor in your costs, including shipping, development, and customer acquisition. Sustainable business requires profitability.
- Customer Identification: Clearly define your target audience—whether it’s women, men, kids, or specific industries—before launching marketing campaigns. Adapt and learn from ongoing efforts.
- Market Size Awareness: Understand the size of your market. A smaller market may require a higher average revenue per customer to sustain the business. Be mindful of potential limitations and increasing acquisition costs.
- Competitor Analysis: Stand out from the competition by analyzing competitors, reading reviews, and understanding brand identity. Differentiate your product to attract and retain customers.
- Cost to Acquire Customers: Utilize paid channels for accurate data in building your business model. Explore alternative strategies, like leveraging influencers or engaged communities, to reduce marketing costs.
- Customer Retention: Consider subscription models for recurring revenue. Encourage customers to return, minimizing acquisition costs over time. Retargeting campaigns or free-of-charge incentives can enhance product appeal.
Remember, building a successful business model is an iterative process, requiring continuous learning and adaptation. Stay tuned for more insights on this topic!
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