The 4 Layers of a Successful Business
Posted by Carlo on July 28th, 2008
NOTE: StumbleUpon people, here’s a brief background to clue you in what’s happening here at Startup Launchr.
A couple of posts ago I announced that a new blog is in the works and asked for your help in naming it. The poll received a great response from Startup Launchr’s readers (that’s you guys! Don’t worry, your free report that I promised will be headed your way real soon).
In anticipation of the new blog to be launched alongside Startup Launchr (more on that in a couple of days), today’s post deals with the core elements of a successful business. This new blog will be dedicated strictly to the business ideas, and will venture to the business planning process in the near future.
Which name did I eventually choose to use, and how did I come to that conclusion? Are you hungry for ideas to help jog your mind for businesses you can start in an instant? Subscribe to the blog, and wait for the next post to find out. Till then, enjoy this week’s treat on Startup Launchr!
Every profitable business is built on a solid foundation. 4 of them, to be exact.
In order for a business to be profitable, these four elements must be in tune with each other from the core to the outer layer. They supplement the 6 rules to follow and give you a basic framework for your business model. When coming up with business ideas, think about it using this structure, starting with the core and building upon it layer by layer.
These 4 layers also serve as a troubleshooting guide. If your product isn’t selling, reverse-engineer the process. Fix your outer layers, and dig in deeper as necessary. If your outer layers are all in check and your product still isn’t selling, then maybe you need to consider moving on to the next business idea and hit a different market altogether.
Using this framework will tremendously help you in brainstorming for new business ideas, as it allows you to think of businesses, markets and products in a systematic manner. Of course, brainstorming should be as form-free as possible, but having guidelines to steer you in a general direction never hurts.
To view this Classroom in the proper order, start with the core and start going outwards.
INNER LAYER: YOUR MARKET
At the core of a successful business is a good market, or a good niche.
The definition of “niche” has been bastardized by the Internet marketing community, leading to much confusion. In Startup Launchr, we’ll use the term as university business classes traditionally define it:
“A niche market is a focused targetable portion (subset) of a market. [It] may be thought of as a narrowly defined group of potential customers.”
Successful businesses target and cater a specific group of people. They must have a well-defined problem and your business should aim to solve this. If your chosen market does not want to spend any money, then no product you create in the world will make your business successful.
INNER-OUTER LAYER: YOUR PRODUCT
The next layer is your product.
Your product must solve a problem (or problems) for a particular group of people. They must solve the problems and cater to the wants and desires of your market; otherwise the company will seem unfocused and all over the place.
Example: The iPod solved the problem of making music conveniently portable. Before the iPod came out, other portable music devices that were able to hold a lot of music were big and clunky. Apple released a product that solved this problem and the desire of being cool at the same time.
OUTER-INNER LAYER: YOUR SALESLETTER
Your salesletter is your advertisement to your product. It is different from your advertisement (to be covered in the next outer layer).
Your salesletter can take on many different forms and sizes. It can come in the traditional form of a one-page long-scrolling newsletter. It can be a series of videos delivered through email. It can be a blog regularly updated with information pertaining to your product. It can be a website showcasing different products with a short description to it.
At its core, an effective salesletter makes the customer realize that you understand their problems, and that you have the solutions to solve them. They make the customer realize the value you have to offer, and gently persuade (not nag) the customer into purchasing your product.
OUTER LAYER: YOUR ADVERTISEMENT
Your advertisement is different from your salesletter. Effectively, it is the salesletter to your salesletter.
Your advertisement comes in the form of PPC ads, banner ads, blog posts, white papers, reports, social media participation, etc. They can be as short as 70 characters long, as long as a thousand words (pictures are worth a thousand words, they say), or an entire book.
The main goal is to drive traffic into your website which contains the salesletter. They entice the customer into visiting your website by giving them the hint that you have something of value to provide them. For your advertisements to be effective, they must be relevant to your salesletter; don’t expect to get much sales if your advertisement says something about pet training and you drive them to a website selling dog food.
Any comments? Drop them thoughts in the comments section below!
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