By Ajayi Joel
What is your selling point?
What is your market size?
These questions happen to be a pain in the neck for most start-up founders or people who want to start businesses. Most times, the only focus is if the idea is a great one and if a great product can come from it. While those are very good, the truth is that what investors really want to know before investing their money is your market size.
In this article, I will help you analyze what a selling point is and how to develop a selling point for your product and at the same time link it to determining what your market size will be.
Myths: If I have a Great Product, I’d have to Smile Walking Down to the Bank
As a start-up founder or business person, you must be able to determine what your product or business stands for. What your product stands for (selling point) will be the road map that directs you right from the idea phase down to the sales phase. This doesn’t mean that selling point cannot change along the line. Your selling point can keep changing till you’re able to locate which one will help you penetrate the market and scale.
I will give two different analyses and break it down for you to understand it perfectly. The first begins with an incident I experienced last year when I needed to take a cab from one point to another. My final destination from where I stood was about five minutes walk if I decided to walk. However, I needed to board the cab to save time. There was another woman who also stood beside me headed for the same direction. A cab pulled right in front of us, and I wanted to board it, only to see the cab man come out to call a third passenger.
My reflex made me walk away from this first cab to another cab who just parked right in front of this first cab, and unknown to me, that was the same decision the woman made. So it turned out that this first cab man lost two passengers within the space of some seconds. The big question is what exactly happened and why did we both make the same decision to go for another cab whom the owner didn’t come out?
Now, here’s the analysis;
I will start by first saying the fault was from the taxi driver because he didn’t understand what his selling point was at the moment. What was the selling point?
This was a distance we could cover by five minutes’ walk yet decided to board a taxi. That shows just one thing; we needed to save three minutes time. Was he aware of our destination before he came out? Yes!! That was the final bus stop on that route so we were his last customers.
Now, being fully aware of that, he was supposed to consider the fact that nothing else mattered to us than the fact that time needs to be saved but he made a wrong posture and that was by coming out of the car. Coming out of the car painted a picture to the both of us that some extra minutes was about to be wasted. At that moment, kind gesture couldn’t have been the selling point. Should a driver be kind and courteous? Well, yes!!
But does it matter more than saving our time in this scenario? Definitely not!!
It might be a secondary value but his first focus which is his selling point should be on how he can save our time.
So how do you come up with a unique selling point and how does it help you determine your market size?
While this may seem to be simple and a lot of people might just tell you to look for a need and solve, it requires proper analysis and once you’ve been able to get your unique selling point, you can smile down to investors that you know your market size and that your business is worth investing in.
Here’s another analysis to help you in understanding how to come up with a unique selling point. However, I must say that it might actually take different trials, different testing to actually determine your unique selling point.
A bottle of water in the town can have a different selling point to the desert. Here’s what I mean?
You’re in a town where the average person in the town has a water dispenser and also a very cool environment. Just producing a large quantity of the bottle water might not necessarily mean good sales if you don’t have a good selling point. If the environment is cool enough that there is hardly a feeling of thirst, then the selling point cannot be to quench thirst. The product is good but you need to change its selling point and that will require you trying a lot of approaches.
Firstly, you need to go back to your “great product” and look for what else you need to add to it or how else you can re-brand it and you can only do this if you ask your “customers” questions on what other reasons they need water for. Fine, it might not be quench thirst. It might be to stay hydrated and both are different. Besides, it might not be any of them but to stay healthy. Now, these still refer to the purchase of water but different reasons.
The next thing to do is to know how many people fall in this category? Is it just the woman walking across your street daily or the whole street itself? How do you know? Well, by making your findings!
This post isn’t about how to make your findings but I will just explain simple ways to get your data or make your inquiry.
- One-on-one discussions: Taking myself as a practical example, I built a product and I’m still building it. However, while in the idea stage, I had met with about dozens of perople to know how exactly my product will align to their needs. Right from the website design down to the marketing, it has been tailored to address the needs. Now, that’s not all, after the website was built again, I took the prototype to these same set of people and watched them try to test it and also kept taking notes.
This way, I will know how best to align the product and come up with the best selling point.
- Online Researches: I have figured out that a lot of founders and people do not know how to make researches online and where exactly they should get pieces of information from. While it’s true that the internet is wide and some pieces of information are not correct, you need to learn the habit of reading a lot. If you do not love reading, then you’ve got a long way to go. Make searches on Google, open as many links as possible, then learn. Check social media pages relating to what you want to understand. Pay attention and study them.
- Extraction of data: There are lots of publications on statistics of different trends, fields and on different data. Search for them using specific key words and you’d be able to locate them.
Now, I have explained how you can make your inquiries and researches. The piece of data you get after all these will determine your market size. Remember, selling point boils down to price consideration. Here’s another analysis.
You want to sell the bottled water in the desert. Well, from pure observation, I would say the selling point will be to quench thirst and stay hydrated. While that seems like it’s all, maybe we should go a little bit deeper. The bottle costs one hundred Naira. However, those in the desert can afford fifty Naira. It’s either you do not have a market there or you go look for another selling point and that will push you to look for ways to reduce your cost of production in order to sell at fifty Naira the target market can afford.
However, if that model will not guarantee your scaling due to losses you will incur, you will need to look for another selling point. Your selling point must always ensure that profit is made and that you can scale. If these two factors are not put into consideration, then you might as well need to review your business plan. If you haven’t developed a business plan, then you can reach out to me to get my professional service on board as well as helping you come up with a winning selling point.
What is your unique selling point? And do you know your numbers (market size)? If you do, then you need to proceed to execution and iterations.