It is often easy to think about an idea and not wonder if you can turn it in to a business model. However, it is easier said than done, as starting a business is no easy job. Having an idea is fine, but the real work lies in building a sustainable model capable of generating revenue. This is where a lot of ideas just become what they are i.e., ‘just ideas.’ Here is a simple guide which may help you convert your idea into a business.
1. Take the dive:
A lot of successful startups were not founded on something new. The founders just identified a problem which could be solved and just began working on it. Starting a business is as simple as just taking the plunge. Jan Koum and Brian Acton, the founders of the popular texting app WhatsApp, left their Jobs at Yahoo! and applied at Facebook, but were rejected. They then developed WhatsApp, which revolutionised the way messages were sent. Had Jan Koum and Brian Acton not taken this risk, the way the world communicates today would be extremely different.
2. Evaluate the idea:
The business idea needs to be evaluated by assigning goals, targets, revenue and capital investment. A lot of initial brainstorming is necessary in order to lay the groundwork which will let the idea become a business model. Try to identify the demand for your idea so that you can be sure to convert the idea into a realistic business model.
3. Do market research:
It is important to set aside a dedicated budget for just marketing the idea. This will help out a lot in the long run by helping a business identify their target audience. Market research provides a ton of data which can be crunched to establish key result areas (KRAs) and key performance indicators (KPIs.) If there are any potential competitors or existing competitors, it is important to research about them as well. Digital marketing, offline marketing and surveys are just some of the things which can be done. Market research is important in estimating the value for the product, which in turn will provide you with the necessary data to develop a revenue model. An interesting example of how market research is vital would be the story of when beverage giant Coca-Cola decided to rebrand the Cola to New Coke, along with a change in the product formula. It caused outrage amongst consumers which led to them boycotting the product. Coca-Cola then realised its mistake and went back to its original name and formula. During initial research surveys, it was found that the new flavour would be received positively. However, the outcome was completely different. Perhaps, had the Company done extensive market research, there are chances the outcome may have been avoided.
4. Making it official:
Once the initial market research is finished and goals are assigned, the business can be made official. This can be done by legalisation, by establishing a business name and business structure. This may help in eliminating the chance of someone else stealing your idea.
5. Hiring your workforce:
Offering jobs on a contract basis can help you out with getting a team to work with you. This will help out in allaying any hesitation with regards to working for a startup, where security is important. Finances can be stringent and it is not easy to get the talent you need nearby, therefore it is helpful if you can hire remote workers.
6. Find a co founder:
Finding a co founder is not an easy job as it begins with self reflection and evaluation of your own strengths and weaknesses. Selling the idea to another person who can complement your weaknesses and allows you to work with each others’ strengths will help out a great deal in managing the business. Apple was founded by Steve Jobs and Steve Wozniak. Wozniak was responsible for the design and development of Apple I, while Steve Jobs took on marketing the product and the rest, as we know, is history. This highlights how a co founder who can add value to the skills lacking in a founder helps build a good business.
7. Building infrastructure:
A lot of infrastructure needs to be in place to be able to run a business, like a building, IT framework and software, amongst many others. Identifying and establishing the necessary infrastructure can help in streamlining your business. A little bit of research can also be done to identify vendors who can take up the burden of starting up. Identifying the right vendor is vital as they may have access to sensitive company or product information. Indian food delivery unicorn Swiggy believed in having a strong infrastructure in place and spent considerable resources in developing their logistics and infrastructure, which contributed immensely to their growth. This led its competitor Zomato to take note and start doing the same in order to catch up.
8. Generating sales:
Once your business is established, it is time to start putting in the work to generate your sales. The future of a business is dependent on the sales it generates. Always be on the lookout for problems which arise during a sale conversion, brainstorm a solution and apply it. Regular feedback on every sale will offer a great deal of insight into establishing an efficient workflow. When Indian e commerce giant Flipkart acquired online fashion brand Myntra, they decided to make Myntra an app only platform. This was a move which did not sit well with the consumers. It reflected on the sales by showing a 10 % dip in revenues, forcing Flipkart to get the website back on. Learning from customer feedback is important in order to keep the sales regular.
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It is not easy to convert your idea into a business, however, begin by utilising these strategies and investing in marketing and customer satisfaction. If you keep doing your market research on a regular basis, there is a higher probability of your business taking off to a good start. A lot of businesses or successful startups took off by following these simple steps. While there are many other things different businesses do when they are starting up, almost all of them may have the same guidelines mentioned above at their core.
How Does WhatsApp Generate Revenue
If you own a smartphone, there is a very high chance that you are a WhatsApp user. The simple and lightweight online messaging application has embedded itself into our lives and has become indispensable. Family groups, friend groups, office groups, play groups and many other groups like these see millions of conversations happening on a daily basis. But have you ever wondered how this leading online messaging application makes its money? There are no ads on WhatsApp and if that is the case from where does Whatsapp generate its revenue?
The answer to the question goes back to the beginning of WhatsApp which was founded by Brain Acton and Jan Koum, both of whom were ex- Yahoo employees. When Whatsapp was first developed and deployed for public use it became an instant hit with users but the founders quickly realised they required data centers to handle the huge volumes of data from the user conversations to keep WhatsApp running. So, they set a price of $1 for some countries and for some other countries it was free for the first year but charged $1 for renewal from the second year onwards. In short this was a subscription model and Whatsapp had 700 million users at the peak of this model which meant it was generating 700 million dollars in revenue.
Facebook ended up purchasing WhatsApp in 2014 for $ 19 billion but one of the founders Jan Koum decided to leave WhatsApp because of a disagreement with Facebook over its use of user data and its desire to allow advertisements on WhatsApp. Both the founders were vocal supporters of user data privacy. As of 2020, WhatsApp has over 2 billion users, the second largest user database after Facebook.
But How is Whatsapp generating its revenue now since there are still no ads on display in the mobile app. In a 2016 blogpost WhatsApp said “Starting this year, we will test tools that allow you to use WhatsApp to communicate with businesses and organizations that you want to hear from. The goal is to have people communicate directly with their banks, airlines, etc. over the app, while the businesses pick up the bill previously paid through subscriptions.” Facebook also uses the data from the user messages in WhatsApp to increase the reach of its ads on Facebook. However, a user has the ability to turn off the settings which allow Whatsapp to share the data with Facebook. According to a Forbes estimate, WhatsApp is generating a revenue of $ 5 billion at an average revenue of $4 per user.
Facebook is benefiting from Whatsapp by generating a huge wealth of consumer behavior data which inturn is being used to improve the ads on Facebook. WhatsApp has a growing revenue stream because of the new users it keeps adding to its database and still has a lot of room to grow.
How To Identify Your Target Audience
Startups are created when there is an existing problem which needs to be solved. Startups often spend years in moulding and creating a product or a service which aims to address a need or a problem. However, it can be easy to lose track of the end goal if the product or the service is not in the hands of the actual target audience. Target audience is a group of people you want to reach with your publication, advertisement (ads) or a message. For example ads related to non vegetarian food would not do any good if they are placed in areas with a high vegetarian population. Ads related to high end cutting edge computers would not do any good if they are not placed in areas which have a high density of industries. Simply put identifying a target audience will translate into sales for your product or service.
Target audiences can be identified by following three simple steps
1. Creating a customer profile:
The first step in identifying a target audience is to assign certain characteristic attributes to the audience which include
- Age: What is the age demographic that is most likely to use your product or service. This is important because customers across different age groups think differently, which would mean the marketing campaign needs to be tweaked accordingly.
- Gender: This is an important metric to be established because a product needs to be able to address these differences. For example, it does not make sense for a male grooming product to be advertised to the female gender.
- Spending Capability: The ability of a target audience to spend greatly affects marketing strategies. People who are able to afford spending luxuriously respond well to marketing campaigns which stress luxury and exclusivity. For example, OnePlus the mobile phone developer positioned itself as a flagship killer with the features of a flagship. It was able to appeal to the middle class spectrum which in turn translated into a huge volume of sales.
Other key characteristics can include marital status, geographic location, hobbies, interests and many more.
2. Conduct market research
A lot can be gleaned from conducting primary and secondary market research. Primary research involves learning about customer buying habits through direct contact like surveys, interviews and focus groups. This is why a lot of startups and businesses usually ask customers to answer survey questionnaires when they make a purchase. Secondary market research is a kind of a market research method that involves collecting information or data from secondary sources. This means a business collects and uses information that has previously been collected by some other person or entity. A simple example would be food delivery platforms like Swiggy and Zomato asking feedback about a recent food order. The purpose of this is to curate a better restaurant selection experience for you when placing a new order.
3. Observing competition
It is safe to say that no product or a service would be a monopoly as new players will keep on emerging in the market. It is always a good idea to know what your competitors are doing with their businesses. This would offer fresh insights related to your marketing strategy like what other offerings could be added to your portfolio, or how a marketing campaign can be changed to tailor the ever changing customer demands. Analysing a competitor can lead to valuable modifications to your offering and yield new business. An example here would be how Zomato acquired UberEats thereby making them the market leader in the food delivery industry in India. Previously Swiggy used to rule the market by holding a majority share in the market. Zomato realised that instead of putting in resources to penetrate the market, acquiring UberEats would give them the advantage. Zomato now holds around 50% of the market in the food delivery business in India.
Target audiences will need to be reassessed periodically on a regular basis. The customer profile needs to be refined regularly and the marketing campaign changed accordingly. As the market trends keep constantly evolving, one can stay ahead of the curve by doing their due diligence in gathering market research data. Start defining and understanding your target audience so that you can make the most of your precious time.
How To Ensure Team Meetings Are Productive During Work From Home Due To Lockdown
The entire world is currently battling its biggest threat so far, the Novel Coronavirus or COVID-19 virus. Businesses and corporate organizations were totally unprepared for the lockdown of entire countries across the globe, which is a consequence of the COVID-19 virus. The lockdowns were enforced as a desperate measure to curb the spread of the virus and give the healthcare infrastructure some amount of leeway to combat the virus.
However, companies and businesses adapted to the lockdown by enforcing a mandatory work from home option to ensure work stays on track. Working from home means having to balance both personal and professional lives at the same place and this can often lead to frustrating situations. Physical team meetings have now moved to virtual spaces where teams can catch up on targets and establish new targets. But virtual team meetings can sometimes drag onto a long time which leads to the decrease in the productivity of the meetings and also a waste of time.
There are however ways to ensure the virtual meetings and conference calls to stay productive and also to finish them efficiently in minimal times.
Equip the team with the right technology and tools
More often than not team meetings see a wastage of time during the beginning of the meets when everyone is joining the meet. Time is lost while checking for the quality of the video and audio and can often look disorganized. It is important to use the right tools or apps which are light and easy to use. Examples include Zoom, Google Meets and Hangouts or Microsoft Teams. Equipping the team with the right tools means the managers and the team stay on the right page.
It is important to spend some time before the meeting to prepare a list of questions and tasks that need to be addressed during the online meeting. This simple task will not only ensure that you stay on track during the meeting but also lets you get into the right frame of mind for the meeting. Any follow up questions can be compiled and can be asked in an email or in a one on one call.
Keep the time/time zones in mind
While scheduling a meeting, the time should be taken into consideration. No one likes to have a meeting early in the morning because it is a normal time in a different timezone. A meeting should be fixed so that everyone attending is comfortable which would in turn mean everyone would be able to participate efficiently.
Speaking over each other
While working remotely, one may not be able to see each other clearly either due to slow internet or bad hardware. There can be video and audio lags as well which would mean you might not be able to know when someone is speaking which would mean two people are speaking at the same time making the situation a little awkward. Therefore it is important to take a pause before speaking to check if someone else on the team is speaking.
Make the team meetings a regular part of the schedule
It is advisable to avoid ad hoc and impromptu meetings during remote working hours as it might disrupt an employee’s work flow. Agreeing on a time and schedule for a team meeting will also send an important message that other people’s time is valuable. Preparing for the meeting in advance also allows you to avoid potential connection issues.
As the large majority of the world is currently working from home, it would be safe to assume that a lot of roles would see the transition to remote work once lockdowns are lifted. However for the moment, it is important to remember that time is valuable and following the above mentioned points will help in improving the productivity of virtual team meetings.
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