Some people write the best titles such as Entrepreneurism is not a Lottery Ticket and I just want someone to buy my idea from me…. With titles like these, you don’t even need to read the entry. If you’re a consultant (paid, peer or otherwise) that is. [Caveat: I cribbed my title for today’s entry from a friend who uses it to great effect.]
Why is it that some people think their idea is akin to winning the lottery? Who would willingly admit one is of such limited imagination that having a marketable idea is so rare -like the proverbial winning lottery ticket- that one must pursue all course of action to protect it or capitalize on it? Which brings us to “I just want someone to buy my idea from me”. I can’t tell you how many emails I get like that each week. Ho Hum. I’ve taken to calling these people “idea flippers”, except they have a lot less collateral than people who’ve speculated with flipping houses. Nobody wants to buy an idea; execution is everything (Guy says it best). Which circuitously brings me to the best sentence I read today (and what started this whole mess)
…scarcity breeds innovation and abundance breeds a dull conformity. This is an exciting time not a frightening time…
So how do you move from innovation and excitement to execution if money is the issue and economic worries loom? I found some very interesting myths discredited on the American Express website in Myths and Realities of Financing Start Ups. From what I’ve personally experienced myself and from watching others, these particular things ring true (and I’d imagine American Express would know):
- You don’t need a lot of money to start a business. $25,000 was the figure quoted but with the right skill set, I’ve known plenty of DEs to start with less.
- You and maybe your family are likely to be your only investor. There are no angels and besides, are you sure you want one?
- You won’t find rich investors; 32% of investors have an income of 40K or less and 17% have negative net worth.
We’ve been talking a lot about this on the forum; we’ve decided recessions are a great time to start a venture; everything is less expensive and vendors should be more willing to do what it takes to keep their numbers up. Theoretically that is; the turnabout being a theme we’re constantly revisiting, that of lowering prices. One person (don’t know if she wants to be named) said it best:
You have to be careful about putting a lower priced customer into a higher priced item by catering to their price point because chances are they will not appreciate the differences in quality, they will feel that the sale price is the REAL and TRUE retail price point and thus you were actually overcharging to begin with AND they are unlikely to upgrade to paying full retail for your goods (because of the first two reasons).
As a result, members (so mentioned because I talk to more of them one on one than the average site visitor) seem to be looking at ways to maximize their positions, re-examining their messages in the marketplace and whether their markets will sustain them as compared to trends. One market many of us use as a bellwether is luxury goods and consumers with higher than average incomes. There’s several sources for that recently. One is Google’s study of online buying habits. Apparently, online shopping is the preferred retail medium of the wealthy. Cotton Inc recently published their study of preferred retail outlets by nation, finding people in Italy, the UK, Germany all spent more money in independent stores and furthermore, spent a lot more on clothes. The U.S. came in 7th place; citizens in China spend more on clothes than we do. Definitely OT but I meant to mention, when I was overseas, I saw a lot of signage in retail shops written in Japanese. The cut to the chase summary of trends is that the pursuit of exporting your brand may become inevitable if it isn’t already. You may as well prepare for it. The Cotton Inc study says -and this is a downside for DEs- U.S. consumers prefer mass merchants (23%) and chain stores (23%). Ouch. One last trend resource I track is Trendwatching. Sign up for their worthwhile and free monthly reports.
One last factor I’ll bore you with that appears to tangentially weigh on all of us is transparency:
Many assume — correctly — that a lack of transparency is what got us into this mess in the first place. Indeed, many consumers now believe that deliberate obfuscation and complexity was used to create huge amounts of fake wealth on Wall Street (true), and that we’re all going to get stuck with the bill (also true).
This could also apply to the messages we’re sending our customers and the lack of transparency. Iconoculture published a great article and in depth chart explaining how the economic crisis relates to shifting consumer values. The weight of personal values such as control, security, thrift, trust, self-sufficiency and stability are implications to consider when targeting your products to consumer demand. One such way DEs are uniquely positioned to provide transparency is through blogging. For example, I’m no longer surprised at the number of visitors who click through from here, wanting to know more about Fit Couture’s manufacturing processes. Maybe many of you think lean manufacturing is boring but apparently a lot of consumers don’t agree. It’s something to think about.