A lot of businesses are started on one “big” idea. A product or service the founder “knows” people will buy. They’re convinced this is “exactly” what the market has been waiting for. In a perfect world, all these businesses would succeed.
Unfortunately, we don’t live in a perfect world and a lot of these businesses struggle and eventually fail. Even the big boys get it wrong. When was the last time you saw a Ford Edsel driving down the road?
That’s why it’s important to have a strong customer base of people who want what you’re selling or a supply chain to distribute your products or services. It’s much easier to find a new product to sell to these customers than it is to find customers for a product. Let me prove it to you.
machines like the one above. Philips is DEEP in the healthcare business. They offer everything from those MRI machines to consulting services for hospitals.
Philips, however, understand the power of their supply chain. They are proof, that having a customer is always more important than having something to sell to them.
Let me tell you what I’m talking about.
That’s right, the name up there is Philips. The maker of multi-million- dollar MRI machines is also in the sucker or binky business. Amazing, right?
Philips helps make the case that your product or service doesn’t matter if you don’t have ready to buy customers or distribution channels. But is Philips REALLY in the binky business?
Probably not. My guess is this is some sort of joint venture or parasite-host relationship with a smaller binky company. Philips provides the distribution channel and their customers. The binky company provides… the binkies.
If this is a traditional 50-50 joint venture Philips wouldn’t need to keep the full 50% of their cut. Why?
Because any revenue generated from the binkies is like found money to them. It’s not their core business, it compliments it. If binky sales are down one quarter it won’t send investors for the exits. So why not capitalize on their existing customer that know, like and trust them and sell them something else?
The best business strategy is one that is not product focused and instead focuses on building a large mass of customers that like to buy from you. It’s always easier to find a new product that it is to find a new market in cases like this.
If you still don’t believe me just look at what Apple does. The products they make don’t have the best specs by any stretch of the imagination. They’re crafted beautifully though. Apple is at the point where they can launch almost any product and it will sell. Why? Because they have customers that know, like and trust them.
Further proof of Apple using the “find something to sell them” strategy is their purchase of Beats by Dre.
Apple needed to find something to sell their people and instead of joint venturing with Beats the chose to just buy the company.
Not the best way to do it in my opinion, but it’s Apples style to not share.
Customers are the lifeblood of a business. Without them you’re nothing. Don’t get so hung up on your product that you forget this simple axiom, “Having a customer is ALWAYS more important than having something to sell to them.”
“Life is a series of missed opportunities, so go for yours.”™
To read Victor’s previous columns, click HERE.