Bespoke services vs digital products
Table of Contents
Priceless solutions.
Creating a business and then constantly managing it will mandate a certain level of knowledge, skills and experience, which you will need to have through previous work and education. Not only that, you should have, at least, a basic and well-structured business plan. Without a set of guiding principles for you to follow you may experience a directionless road with a journey to nowhere.
You will need to decide what you wish to provide (product/service), who are your customers/clients (target market), how to provide it (physically/digitally), how much to charge (expenses/revenue/profit) and how to charge for it (cash/card/online payment). But, what exactly are a bespoke service and a digital product?
Bespoke: Made with specifications in mind.
Service: The action of assisting or performing work.
Digital: Lacking a physical form.
Product: An article or substance that is manufactured or refined for sale.
Now let us combine these terms together:
Bespoke service: The action of assisting or performing work with specifications in mind. This can take a few hours to a couple of months or even years to perform.
Digital product: A product that is manufactured or refined for sale and lacks a physical form. This can be an instantaneous digital download or require a few weeks to develop.
This brings us on to the topic for this article, should your business focus on only providing “tailor-made impact-friendly” services for your clients or provide “quick-sale budget-friendly” products for your customers?
Let’s get down to business.
Financial success.
Being a business owner means that you have the responsibility of deciding how financially successful you require your business to be. There is one major caveat to mention before explaining financial success. Financial success means very different things to different individuals. Financial success could mean freedom from debt or full financial independence.
Every business owner has a unique perspective of their business. Yet, many business owners unintentionally walk into the pitfall of defining success in terms of other business owners and not for themselves. The only way to determine success for your business is by focussing exclusively on your business. Have you planned and implemented steps to place your business in a better situation than it was before?
Financial success is not random and is possible for many business owners to embrace. All that is required is a realignment of the definition of financial success to a more practical and realistic result, being in better financial shape than your business was a year ago, ideally significantly better financial shape. In order for your business to be financially successful you will need to:
Develop a plan: Financial success is not gained overnight and most certainly will not occur by chance. Businesses typically have quarterly goals, annual revenue targets, and five-year business plans. Therefore, why not approach financial success with a long-term strategy complied with short-term objectives and end-goals.
Invest in the business: Thriving businesses endorse growth and investment. Investing in every member of staff, the business owner included, and growing everyone’s potential can assist the business as a whole to be financially successful. When everyone has a stake in the business, not necessarily a financial stakeholding but rather being appreciated and rewarded for their work, that business can improve in unison. Adding a new skill or designation can increase your revenue-generating opportunities.
Eliminate debt: Every financially successful business implements critical debt management. By reducing, eliminating or even avoiding business debt you are guaranteeing that your business survives. If you cannot pay the cash then do not make the purchase. Having said that, debt may be a necessary tool. If your business paying for unyielding assets then this will be a burden on your financial foundation. Identifying fruitful assets is an acceptable debt that can invest in your business is a way to increase your potential revenue.
Discover a like-minded partner: Generating money by yourself is a great way to maximise your personal funds. However, when it comes down to the work it is hard to do everything yourself. Therefore, having a business partner is an investment for financial success. A business partnership is a lot like marriage. You plan together and spend together. The purchasing business assets should not be a surprise to either partner. Making decisions regarding debit and credit should be a team effort.
Be patient: The truth is, bad things happen to good people. Despite having well-developed plans, setbacks often occur. Businesses collapse, investments fail, tragedy strikes in ways big and small. Patience is a virtue, avoid being distracted from your business objectives and end-goals. If the timescale for financial success has to expand beyond its initial prediction then that has to be so.
Income.
Everything in life contains a level of risk and keep in mind that your products/services are an investment for your customer’s/client’s business. There are ways to provide a nearly similar solution to solve your customer’s/client’s problem through hands-on or automated income means. The type of income-generating methods include:
Active income: Requires an effort to keep and maintain it. Active income is generally your salary or an hourly wage. Providing an active income solution to your customers/clients will allow you to be more hands-on in solving a problem. This is a great bespoke service model that will allow your customer/client to receive a tailor-made impact-friendly solution to align more with their business operations. However, there is variable pricing and timescales depending on the scale of the project.
Passive income: Requires minimal effort to achieve. Income from a rental property, investments on the stock market, participating in affiliate marketing, and distributing digital items online. Providing a passive income solution to your customers/clients will allow you to be more automated in solving a problem. This is an awesome digital product model that will allow your customer/client to receive a quick-sale budget-friendly solution that provides a foundation for their business operations to build on top of in-house. However, the pricing is much lower and may offer a generic solution.
Market systems.
Understanding what type of market system your business operates in can be valuable for you to make optimised pricing and production decisions, or when determining whether to enter or leave a particular industry. Depending on the type of business and the industry that business exists in, there are a variety of market systems that pose unique challenges and opportunities. These include:
Perfect competition: Characterized by infinite yet different number of buyers (target market) and sellers (supplier). With a high volume of market stakeholders, is it impractical for a business owner to adjust prevailing prices within the market. If there is a strategy to inflate pricing then the buyers and sellers have infinite avenues to pursue.
Monopoly: This is the exact opposite of perfect competition. Typically, there is only one producer of a particular good or service, and generally no reasonable substitute. Therefore, pricing can be set at any price point due to the absence of competition. However, the overall revenue for this business may be limited by the ability or willingness of customers/clients to pay the set price.
Oligopoly: Similar in many ways to a monopoly, this market system differs in rather than having only one producer of a good or service, there are multiple producers or at least multiple producers that form a dominant majority of the production. However, oligopolists do not have the same pricing power as monopolists and there may be a potential for collusion in setting prices between businesses.
Monopolistic competition: Combining elements of a monopoly and perfect competition, this market system has numerous competitors in the market. However, each competitor is sufficiently differentiated from each other that few businesses may have the ability to charge greater prices.
Monopsony: Opposite to perfect competition, this market system has only one buyer for a particular product/service. Allowing the buyer to have significant power in determining the price of the products/services provided to them.
Market reach.
When owning a business, you will need to research and identify your target market. Once this is complete you can then research and identify how to cater for your market. Where are they based? How can they be reached? Do they really need your products/services? Should you move on to another market locale? These are some of the questions that will enable your business to connect with markets. These markets are:
Local markets: Customers/clients who purchase products/services in the vicinity of where they are provided.
Domestic markets: Customers/clients who purchase products/services within the boundaries of their home country.
International markets: Customers/clients who purchase products/services within any geographical region where business is conducted that is outside the territorial boundaries of the business's home country.
Differences between bespoke services and digital products.
Identifying a model of commerce that suits your business will require you to develop a business plan that clearly determines a monetization strategy, providing bespoke services or digital products or a mixture of both.
There is no right answer for what will and will not work in your business at a moment in time. Only through testing and feedback can you develop a monetization strategy that effectively evolves your business. There may be times that you may hear an individual claim that bespoke services are the only way for creating a sustainable business. Then again there may be other times that another individual claims that digital products ensure profitability. It can be callous to say that one individual is correct and the other is incorrect. Both monetization strategies are as good as each other. However, claiming that one strategy outperforms the other is a misrepresentation.
Perspectives from outside of your business should not account for how you believe your business should be managed. One strategy may work well for a particular business and the same strategy may not perform effectively for another business, there are many reasons why this happens. We, therefore, cannot assume that the strategy is unfeasible. Perhaps one business had a well-organised business plan and the other did not. Discovering what monetization strategy aligns the most with your end-goals is part of the process of developing a business plan.
What exactly are bespoke services?
Bespoke services can assist clients with practically anything that involves hands-on work. This can be more of an educational style, designed to guide and teach clients to achieve a certain outcome, such as coaching and consulting. Or a done-for-you service, involving you taking the work off a clients workload, such as design or virtual assistant work. Types of bespoke services include:
Business consulting.
Life coaching.
Spiritual coaching.
Productivity coaching.
Parenting coaching.
Marriage consulting.
Health & wellness consulting.
Fitness coaching.
Creativity coaching.
Confidence consulting.
Public speaking coaching.
Leadership coaching.
Content creation consulting.
Social media consulting.
Mental illness consulting.
Chronic illness consulting.
Web design.
Web development.
Branding.
Graphic design.
Copywriting.
Social media management.
Photography.
Advertising.
Strategy.
Event planning.
Search Engine Optimization.
Bookkeeping.
Customer support.
Launch planning.
Project management.
Video editing.
An alternate method of bespoke services.
Many modern businesses are evolving from a traditional business revenue model where revenue is generated from a customer's/client’s one-time purchase to a subscription revenue model where revenue is generated on a recurring basis in return for consistent access to the delivery of a product/service. This revolutionary revenue model is referred to as “as a Service”, abbreviated as ‘aaS’. This model can improve accessibility, scalability, and reliability while minimizing overhead and maintenance costs.
As a Service was typically associated with a service that is delivered on a subscription basis via the cloud, without a physical component. The modern cloud computing era dates from the launch of the first business-class Software as a Service (SaaS) application, Salesforce.com, in 1999. But of course, there were precursors, including application service providers (ASPs) and, before that, utility computing via timesharing on mainframes. However, aaS is not represented by cloud-based services alone but the ‘as a service’ model has been extended to just about everything you can think of, even most outsourced services can be delivered by subscription.
Broaden your perspective and understand how you can evolve your business with examples of subscription-based services:
AaaS (Appliances as a Service): Delivers, installs, repairs, moves, adjusts and picks the appliances up again at the end of the contract. After their use, appliances are repaired and reused, and working components redistributed.
AIaaS (Artificial Intelligence as a Service): Allows developers to experiment with AI and test different machine learning algorithms without a huge initial investment and with lower risk.
BaaS (Backend as a Service): Backend cloud storage and processing for faster application development. Helps developers focus on their app’s features instead of spending time wondering how to scale.
BaaS (Blockchain as a Service): Allows businesses to use cloud-based solutions to build, host and use their own blockchain apps, smart contracts and functions on the blockchain infrastructure developed by a vendor.
BaaS (Building as a Service): Lessens the pressures of time and resources by delegating the responsibility of the design, construction, energy efficiency management, ongoing building operations and financing.
CaaS (Cloud as a Service): Also known as cloud services, this is an all-in-one service offering that combines Infrastructure as a Service, Platform as a Service, and Software as a Service technologies in one subscription.
CaaS (Containers as a Service): A complete runtime environment hosted in the cloud. Containers package up an app with all necessities and standardize how it runs. Cloud containers make it even easier to test from anywhere.
CaaS (Country as a Service): E-residency provides access to a variety of digital services in the country.
CaaS (Commerce as a Service): This allows your customers to avoid having to choose between their rich content and a robust eCommerce platform. This allows more flexibility in content management and delivery, user experience, and SEO.
CaaS (Communications as a Service): An outsourced communications solution that can be leased from a single vendor. Can include voice over IP (VoIP), instant messaging (IM), collaboration and videoconference applications using fixed and mobile devices.
CaaS (Compiler as a Service): The compilation process is broken down into pieces with a public API that lets you examine the syntactic and semantic models built by the compiler during compilation.
CaaS (Compliance as a Service): A cloud service level agreement (SLA) that specified how a managed service provider (MSP) will help an organization meet its regulatory compliance mandates.
CaaS (Content as a Service): A service-oriented model, where the service provider delivers the content on-demand to the service consumer via web services that are licensed under subscription.
DaaS (Data as a Service): When data is siloed off, it is not working as hard as it could. By centralizing data in the cloud, it can be accessed easily and analyzed far more deeply.
DaaS (Desktop as a Service): See Workspace as a Service (WaaS).
DaaS (Device as a Service): Leasing of the latest hardware, along with ongoing management and support.
DaaS (Database as a Service): Cloud-based software tools are used for working with data, such as managing data in a data warehouse or analyzing data with business intelligence. It is enabled by software as a service.
DRaaS (Disaster Recovery as a Service): Leaps into action in the event of a catastrophe to repopulate your network’s data, infrastructure, and applications, ideally before your users even notice a hiccup. More robust than backup aaS.
EaaS (Environment as a Service): Going further than virtual machines or containers, provides test management, test case development, and test execution.
FaaS (Framework as a Service): A software framework that provides a customizable foundation for developing apps or systems. It’s not a finished product like SaaS, but it requires less work to implement than a PaaS system.
GaaS (Games as a Service): Providing video games or game content on a continuing revenue model, similar to software as a service. These are ways to monetize video games either after their initial sale or to support a free-to-play model.
HaaS (Hardware as a Service): See Device as a Service (DaaS) and Notebook as a Service (NaaS).
IaaS (Infrastructure as a Service): Makes world-class IT infrastructure available to any size of business, with setup and maintenance outsourced to third parties.
IDaaS (Identity as a Service): Comprises cloud-based solutions for identity and access management (IAM) functions, such as single sign-on (SSO). These methods allow all users to more securely access sensitive information both on and off-premises.
IoTaaS (IoT as a Service): A ‘pay as you go’ service for IoT devices, so you only use the devices and resources you need at the time.
KaaS (Knowledge as a Service): A computing service that delivers knowledge, which is data with context, to users, as opposed to just data or information.
LaaS (Lab as a Service): Remote-control all lab instruments using a cloud lab without setting foot in the building. Instantly access a fully automated lab without capital expenditure using a cloud lab.
LaaS (Licencing as a Service): A modern approach to software licensing in which a provider enables an organization to support its various software and application licenses without the need for an in-house licensing engine.
LaaS (Linux as a Service): Build a Linux server in the cloud.
LaaS (Location as a Service): Businesses sit on an enormous quantity of customer location data without the tools to pull business insight from it. Location aaS lets them rent high-quality location data analysis.
LaaS (Logging as a Service): An IT architectural model for centrally ingesting and collecting any type of log files coming from any given source or location; such as servers, applications, devices and so on.
MaaS (Monitoring as a Service): Oversees from the cloud how IT infrastructure, systems, and apps are running. Avoids having to purchase and install a potentially costly on-premises monitoring tool.
MaaS (Management as a Service): Implementations unify different systems management features and products into a common management environment that spans all system management types.
MaaS (Messaging as a Service): Reducing the obstacles associated with maintaining legacy SMS/MMS messaging infrastructure, while also enabling seamless integration with RCS and other advanced services over IP/IMS.
MaaS [Bare] (Metal as a Service): Designed to help facilitate and automate the deployment and dynamic provisioning of hyperscale computing environments such as big data workloads and cloud services.
MaaS (Mobile Backend as a Service): Enables developers & development teams to simplify the creation & management of their app's backend.
MaaS (Mobility as a Service): An ecosystem designed to deliver collaborative and connected mobility services in a society increasingly embracing a sharing culture, is at the centre of this disruption.
NaaS (Network as a Service): Rented network functionality from a third-party that owns the infrastructure, usually an ISP. Scale up or down on port capacity as needed. Works best for companies with highly variable demand.
NaaS (Notebook as a Service): Enables you to script faster with low-code formulas and templates. Automate all your tasks in minutes.
OaaS (Operations as a Service): A third-party service that helps businesses design, build, maintain, and monitor the IT infrastructure of their dreams. A new name for a managed service you’ve likely been offering for years.
PaaS (Platform as a Service): Provides not just infrastructure but operating systems, software, databases, and other useful tools.
RaaS (Ransomware as a Service): DIY ransomware kits that would-be criminals can purchase and implement.
SaaS (Software as a Service): Centrally hosted software with subscription licences.
SaaS [IT] (Security as a Service): Outsourced management of a company’s network security and data regulation/compliance to a third party, like a MSSP (managed security service provider).
SaaS (Storage as a Service): A cloud business model in which a business leases or rents its storage infrastructure to another business or individuals to store data.
SaaS (Surface as a Service): A comprehensive end-to-end IT solution as a managed service that allows Microsoft’s Cloud Solution Providers to offer Surface hardware as a managed service offering.
UaaS (Unified Communications as a Service): Managed and hosted communications channels, including VoIP, instant messaging, LinkedIn, Skype, phones, Wi-Fi, and social media.
UaaS (Understanding as a Service): Make it possible for buyers to select much more suitable apps by better understanding their own business requirements.
UaaS (University as a Service): Where higher education courses and degree modules are unbundled and accessed via a monthly subscription, could be a landing spot for the future of higher education and lifelong learners.
UaaS (Uptime as a Service): Take care of the management, maintenance, security and online privacy, monitoring and back-ups of your infrastructure.
VaaS (Verification as a Service): Similar to SaaS, leveraging the computing power offered by a cloud environment with automated provisioning, scalability, and service composition.
VaaS (Video as a Service): Cloud-hosted video conferencing.
VaaS (Virtualization as a Service): Virtual servers hosted on hardware in secure data-centres.
VaaS (Visibility as a Service): Provides a large set of ‘as-a-service’ features for visibility and optimization of your IT infrastructure using best-of-breed tools.
WaaS (Workspace as a Service): Virtual desktop environments with all the business data and applications.
WaaS (Wi-Fi as a Service): A fully cloud-based management system, which allows organizations with limited IT resources to provide secure, reliable, and fast WLAN access across various locations.
WaaS (Windows as a Service): An approach Microsoft introduced with Windows 10 to deploy, update and service the operating system. Instead of releasing a new version of Windows every three to five years, it will continually update Windows 10.
XaaS (Anything/Everything as a Service): A general category of services related to cloud computing and remote access. It recognizes the vast number of products, tools, and technologies that are now delivered to users as a service over the internet.
What are the advantages and disadvantages of bespoke services?
| Pros of services | Cons of services |
|---|---|
| More control over your client’s experience. | Difficult to discover and handle optimal clients. |
| Working as a 3rd party individual with the client. | Client attitude, respect and comprehension. |
| Cater your solutions and ideas to fit their needs. | Stagnation from trading time for money. |
| Greater trade-off with your efforts. | Pressure and social anxiety. |
| Trading time for money. | Difficulty in scaling. |
| Generating a profit faster. | Limited creativity by clients requirements or lack of clarity. |
| Working one-to-one with clients provides more hands-on knowledge and experience with your niche/area-of-focus. | Time loss in communication. |
| Hearing struggles and identifying problems first-hand, which is critical to developing targeted solutions. | Low appraisals. |
What exactly are digital products?
Digital products are typically associated with the delivery of information, content or some form of creative work over the internet. This exchange can be enacted via the transfer of log-in access, website instant downloads, file hosting services (DropBox), or email attachments. Sometimes, individuals associate digital products with free items. Even though free is nice, a paid digital product offers better quality and higher value for the customer/client. Types of digital products include:
Tutorials and guides: In-depth and higher quality self-learning educational content, in the form of videos, text or audio.
Courses: Just like in-classroom lessons except that there are taught online via text, video, and audio assets.
Masterclasses: Speciality classes in which learning objectives are achieved through in-depth practice accompanied by detailed instruction.
Branding assets: Elements that help identify a specific brand.
Brand boards: Short and easy-to-read document that includes all the visual elements of a brand.
Names: Identifies products/services as distinct from competitors.
Logos: A visual shortcut to the trademark of the brand and involves a combination of typographies, graphics/symbols, and colours.
Slogans: The advertising tagline that conveys the brand's spirit in the shortest way possible.
eBooks: These are books but accessible through electronic devices. These can have various lengths and content while being self-published.
Photography and videography: Photographs and videos can be sold as stock assets through marketplace websites or your own website.
Music: Record music and no need to produce a physical product, such as a CD, you can make your music available exclusively as digital files.
Website themes and elements: Design a themed and functional website framework that performs in a particular way and provide interactive elements or snippets of code.
Website templates: The layout and design of the platform apply to your content.
Navigational buttons: Each button corresponds to the direction that you can move in a menu.
Header images: The top section of the web page.
Font combination suggestions: Two or more web typography combinations.
Social sharing buttons: This provides users with the ability to display content from a website on to Facebook, Twitter, Pinterest or other platforms.
Code snippets: Small section of text or source code that can be inserted into the code of a program or Web page, including HTML, CSS, Javascript.
Research and data: Provide data, such as industry information or study results, to assist individuals who do not wish to perform their own research.
Software programmes: Develop subscription-based productivity and web insights to designing and drawing software programmes.
Recipes: Help individuals explore cuisine from around the world with themed recipes, in the form of ebooks, apps or subscription-based.
Apps: Mobile applications can involve a small charge or implement a ‘freemium’ model, which means that you can include in-app purchases for individuals who want more features, benefits, or information.
Podcasts: Commonly a free online radio show, but can be a subscription-based podcast that offers increased features, in-depth guidance, and more.
Printables: Create printable agendas, schedules, planners, artwork, scrapbooking assets, or something else entirely.
Swipe files: A document that contains valuable assets for a particular goal, hobby, or job. A range of icons, other graphics, research, data points, checklists, and more for use on websites, marketing assets, or other deliverables.
Templates and calculators: Templates can range from interior design to music composition while calculators might help people determine the ideal interest rate for a mortgage or the best combinations of investments.
Patterns: For cross-stitching, knitting, crocheting, watercolouring, and more.
Graphics arts bundle: Free or premium graphics, icons, and other graphic assets.
Backgrounds.
Textures.
Clipart.
Woodcuts.
Fonts.
Overlays.
Stencils.
Shapes.
What are the advantages and disadvantages of digital products?
| Pros of products | Cons of products |
|---|---|
| Typically inexpensive or sometimes completely free. | Inexpensive income-generating method. |
| Once developed, the product can be sold for long periods of time. | A generalized solution. |
| No limit to how many times the products can be sold. | Sold on mass, limiting personalisation. |
| No constraints of inventory or time for service. | Digital products require a lot of initial development time. |
| Easy to develop, deliver and access. | Competing in a widely saturated industry. |
| Appeal to your community or newcomers. | Tricky to make solution stand out. |
| Solution for customers who need to work at their own pace. | Strict discipline in developing a quality product. |
| Value in quality and time saved. | Anyone, without experience, can sell digital products. |
Comparison of bespoke services and digital products.
A general overview of the differences between bespoke services and digital products include:
| Bespoke service | Digital products |
|---|---|
| These are the amenities, benefits or facilities provided to clients. | These are the material items that the customers are ready to purchase for a price. |
| Intangible items, cannot be seen or touched. | Tangible items, can be seen or touched. |
| Ownership is non-transferable. | Paying the consideration, the ownership of products is transferred to the customer. |
| Evaluating this can be difficult for each service provider as approaches can be different. | Can be evaluated. |
| It is not possible to return or exchange once they have been provided. | May be returned to or exchanged with the seller. |
| Both the service and service provider are inseparable. | Can be distinguished from the seller. |
| Can never remain the same. | Can remain the same regarding physical characteristics and specifications. |
| Are time-bound. | Can be stored for future use. |
| Produced and consumed at the same time. | Are produced, then they are traded and finally consumed. |
Engagement within bespoke services and digital products.
Lead generation.
This is a marketing activity that results in acquiring information useful for building a list of potential customers/clients. The customer/client can be called “the lead”. Lead generation can be divided into outbound and inbound channels.
Outbound lead generation: This is a way to engage with potential customers/clients who might not know about your products/services. This works by communicating with the potential customers/clients, including:
Cold calling.
Direct email.
Social selling.
Direct mail.
Advertising.
E-mail marketing.
Inbound lead generation: This is a method of attracting customers/clients to your business to view your products/services. The concept is to display targeted content that appeals to ideal customers/clients. This works by pushing customers/clients to act and initialise a relationship, including:
Search Engine Optimisation (SEO).
Social media.
Pay Per Click (PPC).
Blog.
Social media.
Content marketing.
Sales funnel.
A sales funnel, also known as a purchase funnel, is a marketing model with a visual representation of the theoretical journey from your customer’s/client’s initial connection with your business towards the end-goal of purchasing and receiving a product/service. The customer/client can be called “the prospect” and “prospecting” is the initial stage of the sales process.
As the name implies the visual aide consists of a funnel, widest at the top and the narrowest at its bottom. This is a guide or channel through which phases in the sales process are initialised and completed with the customer/client. Each phase of the funnel moves qualified customer’s/client’s into the next phase and halts any leads that do not fit with your offerings.
Sales funnel phases.
A standardised sales funnel has four phases, although there can be more phases if required, this includes:
Awareness phase: At the beginning of the journey for product/service discovery, your potential customers/clients have a problem that needs solving and they are researching potential solutions. This is when they interact with your business through the marketing activities and branding campaigns that you had implemented in your advertising strategy. Early in this phase, your customers/clients may still be trying to identify their challenges and they may have questions about them. Your customers/clients just know the symptoms but are searching for a problem solver.
Leads phase: In this next phase, your customers/clients should have identified and defined their problem, and they are looking into all available product/service solutions. Now, you are trying to tempt and convert your customers/clients into connecting with your business. This is accomplished through lead generation and lead qualification tactics, such as a landing page or a squeeze page, opt-in offers and so on.
Prospects phase: Prior to initialising the sale of a product/service, your customers/clients should know and understand their problem and the proposed optimal solutions available to them. Here, the customer/client is being convinced that your products/services are the solutions that they need. This is accomplished through pitching products/services and follow up tactics, such as offers, personalised emails and so on.
Sales phase: This is where your customer/client follows through with purchasing your products/services. Thus, your business generates income and you can maintain a relationship with your customer/client with exclusive memberships, loyalty programmes, customer specials and so on.
By understanding and analysing your sales funnel you can identify what is working and not working with your business’s prospecting, where are leads dropping off and what led existing customers/clients to follow the sales funnel all the way through. By optimising a well-defined sales funnel, you will be able to improve your customer’s/client’s journey and create better results for your sales end-goals.
Sales funnel value.
A sales funnel can bring your business worthwhile benefits that improve the overall quality of experience and long-term revenue. It can be concerning when you have a potential customer/client who is asking so many questions even before thinking of purchasing from your business. This is why a sales funnel can assist you in understanding what it is that they need to move them to the next phase. The fundamentals of a sales funnel include:
Delivering the right message at the right moment.
Enabling alignment between marketing and sales.
Creating commitment and loyalty.
Save time by dismissing unqualified prospects and focusing on hot or qualified leads.
Move deals into the next phase quicker.
Track sales metrics that matter.
Sales funnel metrics.
Collecting, compiling and analysing metrics from your business’s sales funnel can allow you to make firm business decisions to improve specific areas when deligating with a customer/client and also the products/services that you provide. The types of metrics that you should track at all times include:
The number of deals in your funnel.
The average size of a deal in your funnel.
Close-ratio: average percentage of deals that get won.
Sales velocity: average deal lifetime before it is won.
Sales funnel management.
It sounds like a dream come true to have a tonne of leads to prospect. Although, maintaining control of all of them at once can be an intense challenge, whilst juggling day-to-day business operations. It will be likely that some of your deals will slip through the net. Just how can you manage your day-to-day sale funnel and reduce losing potential sales?
It is critical for many businesses to invest in optimal hardware and software to improve productivity, streamline workloads, tighten communication and automate payments. Implementing a custom system that aides your business can be the backbone for success and growth while relieving you from having to remember to manually manage each individual lead.
An optimal system will be able to provide you with the ability to have a visual of the whole scope or intricate details of your sales funnel stages, as well as organising reminders for key actions and transitioning to the dealings. This solution is called CRM (Customer Relationship Management) software. CRM can help you to:
Forecast sales, monthly, quarterly and annually.
Track lead activities.
Leverage reminders and maintain control of dealings.
Organize your day and track hours spent with your leads.
Automate certain sales activities.
There are many CRM solutions to choose from, each with advantages and disadvantages. A platform that ProjektID has experiencing in utilising is the Knack platform that offers a huge potential to create a custom system and can handle:
Workflow and automation.
Data management.
Reports and dashboards.
Payments.
Integrations.
Practical solutions.
Combining services and products together.
In business, you are not forced to choose between one monetization strategy or another. The truth is, you can combine both bespoke services with digital products. Blending both strategies will allow you to diversify your income streams. Having said that, when starting a new business, it may be worth selecting one monetization strategy to start with. Begin to generate sales, discover your routine and increase profits.
It is necessary to have a long-term vision in your business plan and set a strong foundation within your business that allows for future incorporations of monetization strategies or to swap between bespoke service to digital products or vice versa.
Let us take a look at how both monetization strategies can co-exist within a business:
Down-selling: This is a strategy that narrows a customer's/client’s expectations by matching them with a more effective solution that best fulfils their needs. It’s most commonly a more budget-friendly alternative to the product/service initially considered by the customer/client. Use this sales technique when a customer/client displays a clear inclination toward refusing to make a purchase.
Redirecting: This is a strategy that enables you to delegate an unqualified customer/client to an alternative product/service solution that you or one of your networks provides. This is designed to prevent a vain attempt for both the business and the customer/client. Time is money for both parties, and identifying from the get-go if a product/service is not ideal for the customer/client will allow you to filter profitable and unprofitable workloads.
Varied solutions: This is a strategy that provides a diversity of scaled products/services for your customer/client to experience. By offering an array of scaled products/services your customer/client can obtain a useful solution, as opposed to a previously considered product/service that may have not matched their business scale.
Sound-boarding: This is a strategy that validates suggested product/service ideas provided by your customers/clients. The results of your sounding board will provide you with an idea of how well the alternative products/services can work within your business.
As a Service model.
Perhaps instead of providing both products and services, your product could transform into a service. Combing products and services can allow a business to be service-centric and to innovate faster while deepening their relationships with customers/clients by providing more value, this is called ‘servitization’. Through the ‘as a Service’ business model, servitization encourages a business to deliver solutions at a fraction of the upfront investment required.
The as a Service (aaS) business model can allow businesses to generate continuous revenue from their products, beyond the conventional initial product purchase. Thus quantifying the value of their solution, whilst positively influencing the business model, products and service themselves. At the same time, the aaS model can allow your business to transition beyond traditional markets, expand internationally, and increase revenue.
There may be a potential for customer/client retention and personalization of services to increase. Although, consider whether your customers/clients will want to rent products that they are conditioned to own, such as a fridge, oven and other electronic goods. Would your customers/clients be easily encouraged to pay a premium for advanced services tied to those products, such as equipment performance reports and maintenance alerts sent by manufacturers?
Depending on your target audience, whether they consist of Millennials and Gen Z customers/clients, they will most likely be used to subscription-based services. Therefore, implementing as a Service model for your products could be a feasible solution rather than providing both traditional products and services.
Some customers/clients may prefer to own products, but with customizable services. As an example, you would own a product but the analytics and intelligence would all be centrally controlled by the manufacturer. Thus, they would release more or less functionality to those devices based on what the customer/client needs.
As a service business model sounds amazing, however, the reality is that shifting from selling products to selling capabilities can be complex and resource-intensive.
The focus.
Modern technology is the catalyst for allowing products to acquire elements of services and both monetization strategies require various approaches to render the solution. The effects of combining products and services involve:
Tangibility: Products are physical, hence you can touch, see, feel and smell them. Meanwhile, services are digital in nature. Value is derived from functionality. The concept is to define tangible elements that connect the customer/client to the service.
Need and relationship: Products typically fulfil a need that a customer has, they continue to see it and use it after the transaction. Meanwhile, services build relationships and trust with the client, there may be nothing to take away from the transaction. Fusing products and services together can allow your business to encourage a product-like service where the product offers a long term relationship.
Quantity with quality: Products typically can have many formulations, such as different ingredients, styles, colours or sizes. These can be analysed in a short period of time and the quality can be deduced rapidly, such as purchasing anti-dandruff shampoo and having less dandruff. Services do not tend to offer multiple formulations, except in some cases of subscription levels. These are evaluated over time and the quality can be deduced over a long period of time, such as having an eCommerce website constructed and generating sales over time. A service could be designed to provide variations of products, thus the product fulfils the customer needs but can be rented over a period of time.
Consumption and time: Products can have long survivability until they will be consumed, whilst services are consumed when they are in use. The flexibility in combining a product with a service can allow customers/clients to see the worth of using a solution for a period of time, pausing and re-using when suitable.
The strategy.
Developing a business can allow you to figure out a strategy that can work well for your business. In order to know whether your bespoke service or digital products or a combination of the both or as a service will be your best starting strategy, you have to know your business mission, your market's needs, and your ideal lifestyle.
Keep in mind that you have time to trade in a service-based model and items to trade in a product-based model. The former allows you to generate income faster but requires having clients to assist, while the latter allows you to sell on autopilot on mass but requires generating income on a grander scale. Active and passive income streams can co-exist. It will take time to develop a plan, test it and analyse the results. Your business may have to evolve and adapt because of changing times or the lack of traction in your market. Running a business involves risk management and risks can provide rewards.
Problem-solving.
Solving simple and hard or complex and easy problems for your clients will require you to clearly identify their business’s problems and in turn, develop sustainable solutions. By not understanding the full extent of a problem, there could be confusion in solving it. An end-goal should solve a problem that has value, for either the customers/clients of your client or for their business itself. Read our article, The process of solving a problem, for more details.
Project’s budget.
Every project has objectives to reach the desired end-goal, the aim in business is to solve a problem for a client in order to generate a sustainable profit. You will have expenses to keep track of within your business and therefore the price of your products/services are representative of the expenses and value combined. You decide how you wish your brand to conduct business with your clients and what mode of income generation you wish to implement. This means, deciding to charge your clients to break even, generate a minimum profit, charge median industry rates or sell value in quality and luxury. Read our article, Factors that define a project's budget, for more details.
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Thank you for taking the time to read this article. Hopefully, this has provided you with insight to assist you with your business.
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