How can we grow a business that is profitable and sustainable.

The Big Question: How can we grow a business that is profitable and sustainable.

When we use sustainable here we mean a business that continuously generates profit.

It is possible for a business to be profitable today but suddenly becomes unprofitable tomorrow.

I remember when one of my past student attended our course and shared in class that she had ran a Facebook ad that generated her 3 million worth of sales with just $300. 

But then she couldn't repeat the process again. 

In fact, the business started to suffer hence why she had to attend our course.

Obviously, her business changed tremendously after attending our course.  

She was now able to build sustainability into her digital marketing.

This is a warning: There is little profit in understanding digital marketing strategies on it own, for example, Facebook advertising or Search Engine Optimization (SEO) on it own.

There is enormous profit in understanding how to apply these marketing channels and strategies to drive business sustainability. 

Here are the steps we believe you need to start and grow a profitable and sustainable business:

Step 1. Validate your business - I was speaking at an event recently as well and I asked a business owner to tell the audience why we should buy their products and services?

And then I asked someone random from the audience to tell us why they would buy his products and services.

Something interesting happened, the person from the audience had a different reason from the business owner.

As the person from the audience was saying why he would buy and you could hear other people in the audience agreeing. This did not happen when the business owner was talking.

I repeated this 3 - 4 times, it was the same result.

Build a business that people want.

Key Point here: - If your business is going to be successful and sustainable then you need to validate it with your customers (The way you see your business is always different from the people who buy it).

Find out what your customers want and why they will buy it from anyone. If you understand what they want and why they want it then it is easy to sell to them and for your customers to buy from you.

Step 2. Do your math and discover the amount of customers you need: Most business experts will tell you not to focus on money but value (Value is money).

This is very true and that is why the first step is to validate your business.

Your customers know the value they want from your products and services and based on the value they are happy to pay for it.

After you know the values that your potential customers will derive from your products and services. You now need to put a cost to it.

Pricing is an interesting topic but you need to understand that a profitable and sustainable business means you need profit.

This means you decide the price (not the customer) that makes you profitable however, here is a point of warning that your pricing must be at least 10% of the value your customers will perceive.

Interesting thing about value is that it is perceived, we bought an iPod made with $99 for $499 simply because we perceived more value then $99.

Apple is an amazing company that will start telling you about the value of their products 6 months before it is launched.

So, you already perceive the value from product and imagine the cost as premium. Because they also tell you the value based on customer research - You want it, they give it to you.

Your pricing should also be guided by rule of quantity or quality.

And the rule of quantity or quality should be based on the market size, viability and time of delivery. 

After you decide the cost then you need to understand how many customers you need every month:

a. How much do I want to make this year that makes me profitable? Let's say 12 million.

b. Divide the number by 12 months and you have 1 million every month.

c. Now, let's say your product cost is 100,000

d. Divide how much you want to make monthly by your product cost. 1million/100,000 = 10 customers.

e. This simply means you need 10 customers every month to meet your profitability target.

Key point here: It is easy for you to reach profitability in your business if you know how many customers you need to meet your profitability target.

You want to make a pledge and if you have a marketing team you want them to make a pledge. This is the pledge:

I, ___________________________________________ will do all that it takes ethically to get _____ customers every months.

Every week, you measure your progress by this statement.

You are allowed to get more customers but not allow to get lower than the number you need to achieve profitability.

Step 3. Marketing is everything in business: You need to first figure out where your customers are and show them how your products and services can drive value for them.

Here you want to understand that the most important activities in marketing is selling the perceived value and not the products or services.

Key point here:- You can only achieve profitability if you market your products and services by selling the perceived value.

Step 4. Maximise Profit: Unfortunately most people do not maximise profits to be sustainable.

What you will achieve in step 1 to 3 is to increase the number of customers. 

But, what of thiese 2: 

1. Increase the average transaction value per customer
2. Increase the number of transactions per customer

They determine if your business is going to be sustainable or not. A business that focuses on thiese 2 will not only be sustainable but will be more profitable.  

• To increase your average transaction value, you need to cross-sell.
• To increase your number of transactions per customers then you need to up-sell. 

Key point here:- There is little profit in just acquiring customers.There is enormous profit in understanding how to up-sell and cross-sell to your customers.

We call it the Customer Lifetime Value where you take a customer through a journey of repeat sales to increase the following:

1. number of customers
2. average transaction value per customer
3. number of transactions per customer

This is the stuff they don’t teach in business or marketing school. You will learn in the course how to build a sustainable marketing system that drives a profitable and sustainable business. 

It’s the same system Starbucks and McDonald’s have used to corner the coffee and hamburger markets. 

It’s the same system Amazon uses to dominate eCommerce.

This system works for all level businesses- small, medium or large.

It works whether you sell traditional products, digital products, or services.

Happy reading... mail me if you have any question : infodigital4all@gmail.com/2348079791052