Chances are that you already have the most important things figured out. You understand who you’re selling to, what their problem is, you created a solution, and you have a framework to deliver it effectively, making it worthwhile to your audience. Despite all this, your revenue curve is not as impressive as you’d want it to be. But a steady cash flow is a top priority; in 2018, 82% of failed businesses blamed cash flow problems for their demise.
Let’s take a look at three strategies that will set your small business on a path towards greater revenue in no time.
Particularly in expert industries, businesses don’t charge enough. Too often, they opt for charging per hour, which has two main problems: First, if you turn your knowledge into a mere commodity, you must accept the fact that there’s always going to be someone on the other corner of the street that can do the same. Second, there are a finite number of hours in the day.
Price your product or service using value pricing instead and assess what solutions your services produce. For example, if you’re saving your client $100k by reworking their tax structure, the client will be happy to pay $20k.
Only two in five startups are actually profitable, which is why getting pricing right is so vital. But you can ditch the market research – just like Steve Jobs did. In many industries, you can sell your product before you create it. Find out how much people are willing to pay and know that the only way to get that is to simply put yourself out there.
Tip: After 40 years in business, I’ve learned that the secret to scaling is finding the balance between acquisition and retention. Those who pay more for acquisition will always win, and prioritizing retention will give you the needed resources. Always have an upsell product to offer to your loyal customers to generate extra revenue: For example, if your initial product is at $2000, your premium can be in the $5-10k range.
Establish an authority platform
Closely linked to pricing, building up your authority platform will make you realize your value and help you showcase it with your subsequent offerings.
Advancing thought leadership can be done in many ways. Whether it’s LinkedIn, Clubhouse, or a podcast (which many believe to be the ultimate marketing channel), these platforms help you connect with your audience and provide value in tightly-knit communities. Be sure not to put your fingers in too many pies, though.
A strong statement like “my book is coming up soon” can significantly stir the business waters; even if you don’t have a book finished, but only a strong idea that supports your business, promoting the cover page and a summary can really get the conversation going.
Tip: If you want authority, remember not to be promotional. Your content and ideas are enough for you to build up credibility – something that will give you more value than any ad ever could. Even podcasts can build serious authority without hosting on anchor.fm or other ad-supported platforms.
Rethink lead generation
Many businesses make the mistake of promoting their product to anyone they can think of – but not everyone is interested in your offerings. Identify your niche audience and become obsessed with them. What conversations are they engaging in? What keywords do they search for? Where do they spend their time? And don’t get fooled easily… They might be on Facebook just to connect with their circle and go to LinkedIn or Clubhouse for business conversations instead.
Lead generation doesn’t happen when you stand on a table and shout the loudest – it happens when you get off that table and step into the crowd to have conversations that give value. That way, you attract organically, and it becomes less expensive to acquire new clients.
Tip: You can grow without blogging, as that only attracts content consumers. You can drive revenue without lead magnets, as they only bring freebie-seekers. And most importantly, you can thrive without a website – at least until you have a few clients already paying. Remember, most of that stuff won’t make a difference. Value your time, focus on what matters, and double down on that.
Throw away empty cliches and everything you have been taught by self-pronounced business gurus. If you set things right, and believe in yourself, you can make big waves – even with a small boat.
Kent Gustavson and Randy Baker, founders of Thought Partner Group
Revenue stock image by Monster Ztudio/Shutterstock