6 Critical Questions Every Business Must Answer

Starting a business, or getting an existing business to profitability can feel like you’re locked in a maze. Which way do you turn? Which way is the way forward? With the following six questions answered, you can move forward confidently, because you will have covered the essential issues that face your business.

The 6 Critical Questions

  1. Who do you serve?  Do you have an ideal customer profile?  If you have no idea who your ideal customer is, you are either spending too much for marketing and/or you’re limiting your ability to maximize your profits.   It’s the difference between shotgun marketing and highly targeted marketing.  When you know your ideal customer, you can target your marketing and limit your marketing expenses to those who are most likely to buy from you.
  2. What need are you addressing?  This is the question that drives purchases.  Meeting a need and providing an attractive solution is the easiest way to profitability.  What problem do you solve for your ideal customer or what opportunity do you offer them?
  3. What value do you offer to your ideal customers?    What is the value proposition that you have to offer others?  Peep Laja, founder of CXL, says that ”  The less known your company is, the better value proposition you need.”
  4. What makes you different?  If you’re selling what everyone else is selling, why would someone buy from you?  Your differentiating factor is how you stand out from your competition.  Analyze your competition and outshine them in some way.  What’s different about your products, your customer service, or price?  There are a number of ways that you can differentiate your business from your competitors.  It’s essential that you do so.
  5. How is your business going to make money?  There are only three ways to make money.  First, new customers.  Second, get bigger sales from your new customers.  Third, repeat customers.  This is basic customer value optimization, and it breaks down into two parts.  1. Identify your best customers.  This gets back to who do you serve.  2.  Align your products and services to your best customers and produce marketing to find, attract, and develop more of them.
  6. How will you promote your products and services?  What is your marketing strategy for finding and attracting new customers, retaining existing customers, and growing your sales?

Answer those six questions and you’ll have the basis for a business plan, a marketing plan, and a successful business.

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