... where visionaries, game changers, and challengers discuss business models
Products are what people buy. Services, programs, etc. are a tougher sell because people find it difficult to give money for something that is intangible. Something that may, or may not, leave them with something that they can touch, smell, hear or see. I know this as well as anyone because I am in the "service" game and asking someone for money so you can give them advice can be very difficult at times! I try to mention the hard wins of the process (e.g. increased earnings) but it doesn't always translate very well. I certainly understand why they might want to buy a book rather than listen to me. At least they can feel the book and know they received something in return for their money.
What does that mean for the average entrepreneur who is starting up or struggling with their business? Fairly simple really. You are not selling services. You are selling products. Products sell. Services not so much.
Perhaps an example of a previous client would be useful. Anita ran a massage service (a real one, not one of those :-)) and had been struggling for several years as clients found her prices ok but could never find the time to come in for a massage. She had some regular customers that kept her afloat because she was good and they knew the value of a good massage.
Why was business struggling if Anita was so good and the service worth it? Because people didn't understand what they were getting for their money. They gave Anita money and she gave them a massage. So what? They could get their friends to massage them for free!
After sitting down with Anita and looking at her business model, it became very apparent that the key point that was missing was she had no "products." Just services. There was no product name. No product description. No list of benefits for the client. No solutions to specific problems. No features. Nothing. Just a good massage. As it turned out, all of these existed but Anita's possible customers didn't see it that way. So, we went to work. Questions that needed answering included:
In the end, it was pretty obvious that Anita was not selling massages. She was selling stress relief. Fewer migraines. Better posture. Increased happiness. Stronger sex drive. Improved breathing. Etc. Etc. Those are only a few of the benefits of a good massage. Also, each massage was different and while Anita adjusted it according to the needs of her customers, she never changed the name. Each massage type was essentially a different product with a different name.
Over time, Anita no longer sold massages. She sold "Stress Relief Packages" that included an evaluation session, customized in-house therapy, at home changes and regular check-ups. The benefits of the package (i.e. product) were highlighted in the brochures and website and a full description of what the customer received was also outlined. She then did this for all the problems/issues that her customers had. As it turned out, Anita didn't have one product (i.e. massages). She had over ten. Each was different than the other and each one of them addressed a specific issue or problem of the customer. Anita then created a marketing campaign that focused on each of these areas and over time, business boomed.
What was the difference between what Anita was doing in the past and what she was doing now? Nothing. However, now customers could understand what she was selling. They gave her money and received a series of benefits and in most cases, something they could touch and see as well (handouts, information, etc.). They received a valuable "product" for their money.
Lesson learned? We are all selling products and the quicker we learn that, the better we will do.
Which reminds me, I have to start developing my product line a little better. I am far too service oriented! :-)