ActionPronto – Inspirations and Insights

And finally, the “L” in IDEAL stands for “loyalty”. This is the element that makes your business model tick; the ability for you to create a customer or client experience that keeps them coming back for more. Even more importantly, their customer experience with you is so awesome, they want other people they know to experience it too, so they refer you.

I like to say that this “L” results in two “R’s” — repeats and referrals. Repeat business is very valuable for you to have, because it doesn’t cost you very much to continue receiving this. And referrals are valuable too, because they drastically lower your cost of acquiring a new customer.

So keep the elements of my IDEAL business model in mind. It could lead you to fulfillment and prosperity in your business. It certainly has for me, for past and present businesses that I’ve owned.

Getting back to my concept of the IDEAL business model, we come to “A”, which stands for “advantage”. Your products and/or services must have some sort of advantage over your competition, some of which may already have greater share of business than you do right now. Looking at it another way, there must be some advantage for your customers to do business with you, compared to whichever competitor they’re using now.

An advantage could come through price, features/benefits, having a patent on a new technology, or even just being repeatedly more dependable than any other supplier. Whatever the advantage, try to build one that is sustainable. A price advantage, for example, is mostly temporary — until your competitors drop their prices too. Building and demonstrating a sustainable competitive advantage is the ticket to gaining market share.

“E” is for Economics – all of the numbers in your business. Prices, costs, expenses, size of market, potential sales, number of repeats, number of returns, demand … anything that relates to your business’s products and services. You should know your numbers, particularly what it costs you to be in business. Too many business owners I’ve read or heard about, are former owners because they didn’t realize the size of some of their numbers.

As a business owner, you should not delegate the knowledge of these numbers to someone else, like your accountant or your marketing director. You should know where you stand.

The “E” also includes economics from the customer perspective, too. What’s the value to the customer, to buy your products or services? What’s the magnitude of financial benefit your products bring to your customer, in terms of saving time, saving money, or some other measure?

“D” represents “Differentiation”, in the IDEAL business model. Whatever you’re offering, whether they’re tangible products or services, needs to be different from whatever your competitors are offering. If you offer things that are largely the same, or what we call “me too” products, potential customers would more likely stick with competitors who have been around longer and who already have a track record.

Of course, if the competitor’s track record is a lousy one, you could offer the same offering and perhaps get away with it. But even then, since you’re an untested supplier of that product or service, you run the risk of the customer thinking that you might be no different than the lousy competitor.

So make something different: your offering needs to allow the customer to be better, faster, more productive, more relaxed, prettier, younger, stronger, slimmer, smarter, funnier, or whatever, than your competitors can do. Without this differentiation (the “D”), you’ll be viewed the same as the others, with no compelling reason to give you a try.