Entrepreneurship Begins With Demand
Translations of this material:
- into Russian: Начнём предпринимательство с Дэманом.. 26% translated in draft.
Submitted for translation by stevepavlina.ru 13.03.2012
Many people who are new to entrepreneurship approach the world of business in some rather funky ways. Quite often they come up with solutions first — or at least what they think is a solution. Then they try to convince people to buy, hoping that those people will somehow see the value in their solutions.
That’s a recipe for glorious failure.
Sure it could work sometimes, especially if you have millions of marketing dollars to help create demand, but for small businesses it’s not a very wise approach. For a sustainable business you’ll want to see some evidence of genuine demand for what you’re going to sell — ideally before you go through all the work of starting a business or creating a new product or service.
Many amazing businesses have been launched because someone noticed an existing problem or some kind of demand for a solution or improvement, and they found a way to fulfill that demand reasonably well.
When I started my computer games business in 1994, I didn’t know if there was any demand for what I was creating. I created some games, but hardly anyone bought them.
Then I went to a game development conference where one of the co-founders of a very successful company explained in plain English the difference between creating games that sell well vs. creating games that don’t.
He said it came down to creating games that people clearly wanted to buy vs. creating games that the development team wanted to create. These goals aren’t necessarily in conflict. He explained how his company went from struggling for 8 years in a row to finally creating some mega-hits. They started paying attention to what kinds of games people really wanted to buy. Then they created games in those genres. Their games sold millions of copies.
It’s not rocket science, but it sure makes a difference.
I applied this advice on a fairly small scale, and my games business did much better. I targeted genres where I saw more demand than supply, and so I didn’t have to push so hard on the marketing front. I mainly just had to get the word out that my games would satisfy a particular type of player. And within a matter of months, those players were flocking to my website.
Erin’s intuitive reading business did well because people were already asking her for advice. People had been asking her for readings since she was a teenager. She mainly had to say yes to what was already showing up. When she began offering readings professionally, people began signing up right away. She got so much business that she had to go through several rounds of price increases until she reached a reasonable equilibrium.
If you want a sustainable business, it’s important to pay attention to demand. What do people want and need? What problems are they having? What sort of help are they looking for?
Quite often you’ll find things you love doing, but nobody else cares to pay for it. That’s fine. Enjoy those activities as your side hobbies. The demand may change in a decade or two.
Other times you’ll notice demand for something, but you’ll have no personal interest in helping out. That’s fine too. Let someone else fulfill those needs.
If you’re open to creating a sustainable business, be on the lookout for evidence of demand that you’d enjoy servicing.
When I started my personal development business, it was largely in response to existing demand. Before I ever wrote my first blog post, people were already emailing me every week with productivity questions, small business questions, motivation questions, etc. It wasn’t a stretch for me to say yes to that because I enjoyed writing about personal growth. But I didn’t start the website and hope the demand would be there. I saw clear evidence that the demand was already there before I started. I said yes to what was already showing up.
Marketing such a business is a lot easier than marketing a business where the demand is unclear. If the demand is already there, then marketing is mainly a matter of letting people know that a solution or service exists and that it may satisfy them.
But if there’s little or no demand, then marketing amounts to trying to convince people they need something, and they may very well disagree. That kind of marketing is a struggle, especially for a small business without a huge marketing budget.
Demand doesn’t have to be personal for it to matter. People don’t have to be asking you to solve their problems. They just have to be asking for a solution.
If you’ve started a small business, and it seems like an uphill battle to generate sales, could it be that you’re providing something hardly anyone wants? If that’s the case, try not to see it as a personal failure. It happens often. It’s all part of the entrepreneurial calibration process. You’ll eventually figure out that sales matter, and it’s easier to generate sales by cooperatively giving people what they want as opposed to trying to convince them to want what you’ve decided to give.