How Do You come up with a Business Idea? – part 3
- Build upon an existing idea.
If you are still having problems or have no hobbies and interests then you can look at things that already exist. Is there something that you use that you are not happy with or that you can improve upon?
Can you write code or develop software? Is there a tool for woodworking or cooking that you need, but doesn’t yet exist? Is your dog groomer lacking or your lawn care company sub-par?
Search engines used to be dominated by Yahoo until Google came along. K-mart was the discount king until Sam Walton started his little store in Arkansas.
GM, Ford and Chrysler were known as the big 3 in the auto industry, but times change and you either change with it or get left behind. If you can come up with a better product, idea or service then you have a chance.
- Narrow down your niche
At this point you may need to further narrow your niche from ‘Training for a marathon’ to ‘People over 50 training for a 5k marathon’. Niche marketing is possible when a business specializes in a particular service, or serves a particular group within its target audience (Working moms with school age children). If the business focuses its marketing efforts around this subgroup, this would be a niche business.
In today’s online marketing you are advised to create an Avatar. What’s an Avatar you ask? It’s your target market, a buyer persona, a customer profile.
An Avatar is a fictional, generalized representation of the type of person most likely to purchase from you. Yes, it may sound crazy, but it helps. As much as we want to think that our product is for everyone that’s just not true or practical.
In order to help you to create your customer Avatar trying listing the following.
List the important information pertaining to your potential customer (such as age, sex, education level, income level, marital status, occupation, religion, and average family size). This will take a little bit of thought.
Psychographic information is used for marketing and refers to your buyer’s habits, hobbies, spending habits and values.
Demographics explain “who” your buyer is, while psychographics explain “why” they buy.
An example would be the following.
Married, with children
Dealing with issues of weight gain, stress, lack of energy
Household income $60K+
Concerned with health and appearance
Wants a healthy lifestyle, but doesn’t have much time
Enjoys going online in the evenings, occasionally hits the gym
Tends to favor quality over bargain priced
Finds fulfillment in his career and family
Yes this is difficult and does require some guesswork, but it helps to define who your target market will be.
Name your Avatar:
Naming your Avatar humanizes the profile. If you are targeting both men and women, you’ll want to create both a male and female name.
- Determine the profitability of your niche.
By now you should now have a pretty good idea of what niche you’re going to focus on. Even if you are not 100% sure or haven’t narrowed your list down to a single topic you should be close.
Before you go any further you need to determine if you can make any money in this niche. You don’t want to spend weeks or months building your site only to find out that there is no market or interest in the subject.
If people have no need or are not interested in your ideas, service or products then you have a hobby. You can still put up your site and pursue your interest, but you must be realistic about the viability of earning an income.
A good way to do this is by going to Google Keyword Planner. You will need to sign up for an account then plug in some keywords (dog walker, cake decorating, widget maker, etc…) and see what pops up. You want to find something with a search volume of 1K-10K a month. If it is less than this there is probably not much of a market for your idea.
Be forewarned that when you sign into Google Adwords it will immediately start you on a marketing campaign, but you don’t need to go that far. Only go to the first page in order to find your keyword information and then log out.
Another site that I like even better than Google and is MUCH easier to use , read and understand the results is a website called MOZ.
Also keep in mind that you don’t have to start your business with a product of your own, but the rewards (emotionally and financially are higher). You can partner with other product creators, advertisers and site owners in your niche to begin generating income while you’re working on your product or service. This is not easy because you are unknown and have no following, but it’s something to think about.
If you follow these principles the ideas will start coming. Soon everywhere you look, every time someone tells you about a problem that they have, you will start trying to discover ways to solve it and figure out new business ventures to begin. After awhile the problem won’t be getting an idea, the problem will be finding the time to implement all of your new entrepreneurial possibilities.