November 13, 2012, 5:00 am

3 Business Idea Killer Questions, How To Answer Them to Make Money

by: The Financial Blogger    Category: Business
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To Be or Not To Be, This is The Question

 

 

Yesterday, I asked you 3 business idea killer questions. As you can see, these questions can be asked for any kind of project. It could be a side gig, a big corporation or simply to market yourself to your client or potential employer.

 

These are more than only 3 killer questions to determine if your business model is sound or not, it should be the basis of your marketing plan for any project. If you can’t answer these questions correctly, don’t go any further. You will lose either time or money on your project. Just come back to these 3 kill questions and start working on your project once you have answered them correctly.

 

Now, considering that you answered them yesterday and they may have killed off 75% of your ideas without telling you why, I want to give you more info on how to understand these 3 business idea killer questions.

 

#1 What is Your Business Idea/Product/Service?

 

The first idea that comes to mind when I ask this question is obviously a list of characteristics, features and benefits. For example, if I ask a financial planner what is his service offering, he will likely tell me that he:

 

-          That he is an expert in investment and financial planning.

-          That he provides a financial plan for his clients so they can retire healthy and wealthy.

-          That he covers all financial planning aspects including insurance, protection, legal issues, personal finance, investments, tax optimization and credit needs.

 

Here’s what I would answer (now that I’ve seriously thought about it):

 

I’m working for you so you can do three things:

-          Make more money

-          Pay less in fees

-          Have more time to enjoy your life

 

So let me ask you:

 

Do you want an investment expert or do you want to make more money?

 

Do you want a financial plan or to you want more time to enjoy your life?

 

 

Both financial planners will do exactly the same things and you will actually make more money if you deal with an investment expert and have more time to enjoy life if you have a financial plan. But instead of promoting the how (expertise, financial plan, etc), I’ve promoted the end results with my answer.

 

A Blog Example

 

Here’s another example from my blog. If someone would have asked me what my blog is about 3 years ago, I would have answered something like this:

 

The Financial Blogger is a personal financial blog that talks about various topics. I have a great twist as I my perception of personal finance often goes against most commonly accepted financial principles.

 

Today, my answer is shorter and different:

 

By reading The Financial Blogger you will find out how I work 4 days a week and earn a 6 figure income. You will realize that you can do it too.

 

Here again, let me ask you:

 

 

Would you rather read an original blog about personal finance covering various topics or would you rather know how to make a 6 figure income in less than 30 hours of work?

 

It’s the same blog, but I’ve positioned it differently. It’s as simple as that!

 

It’s not always easy to find the “right answer” that will translate into a “wow” for your potential clients. For example, I would be speechless if you’d ask me to present an example for a lawnmower. The end results is pretty much what the lawnmower should do in the first place: cut the grass! Nonetheless, the key is to tend to eliminate the characteristics and features from your answer to focus on benefits and, especially, the end result.

 

#2 Do You Have Competition Already? Are There Other People Doing What  You Want to Do?

 

 

This is probably the question out of the three that is the most counter intuitive. Most people try to find a niche where there is absolutely no competition. They think that they have found THE idea that will make them some dough as nobody else is doing it.

 

Let me ask you a silly question:

 

Would you consider building a business that offers customers to go to their home, pick-up their car and fill it up with gas and bring it back?

 

Nobody is doing this. There are absolutely no way that I could pick-up the phone or send an email while I’m at work so someone could go, pick-up my car and put gas in it. Why is nobody doing it? Because there is likely no money to make out of such a service!

 

As a customer, I think it would be nice if someone could pick-up my car and gas it, wash it, install my winter tires, go for an oil change, etc. There are plenty of additional services that can be added. The problem is that nobody is willing to pay the price so both the customer and the entrepreneur will be happy. Therefore, it isn’t easy to make money out of it.

 

If you can’t find any competitors in your niche, this is because of two reasons:

 

#1 You haven’t searched enough

#2 Nobody is doing it because there is not enough money to make out of it

 

Unless you have a completely new technology in hand, it’s likely impossible that nobody before you thought of the idea. You can have a unique idea in an existing market that will provide you with a competitive advantage. But it can be extremely difficult to create a market for your product or service if it doesn’t exist already.

 

Creating a market is incredibly expensive and takes years to establish. How much do you think cell phone companies had to invest in technology and marketing to convince everybody that they need a cell phone? How many years did it take to create this market that didn’t exist 20 years ago? We are talking about hundreds of millions of dollars and several years. The worst part is that the cell phone was an amazing idea. So imagine if you have a good idea but not something that will revolution the lives of people. It’s going to be even harder to develop your market!

 

If you have millions sitting in your bank account, you may think to create a market. But if not, you will just work hard like a donkey and never get anything out of it.

 

Competition is a good thing

 

Believe it or not but your competitors are not just working against you. A great example of this is my blog and business. I’ve never seen so many financial blogs in my life as there are today. There must be over 1,000 personal financial blog written in English. When I started in 2006, I think we were not even 100. The funniest part is that I’ve never made more money and generated more traffic than this year.

 

The fact that there are so many PF blogs generates more publicity for all PF blogs. There are now communities of PF bloggers and the population is now aware of this phenomenon. More people are introduced to reading financial blogs today because they are more accessible and have more visibility. And when people go somewhere, you can make sure that advertising budgets are following them! This is why competitors could be a great source of customers too. You just have to be better than the average PF blog to benefit from it.

 

The same thing will apply to almost any business model. The only exception is the business model requiring a lot of investment. For example, it’s impossible to think of starting to compete against Apple today… unless you own Microsoft!!

 

#3 You Thought of Your Idea/Product/Service, But Did You Think of How You Will Make Money Out of It? What is Your Business Process?

 

If your idea survived the first two questions, this is a good sign: you probably have a good business idea in mind. But good doesn’t mean great. And a great idea is what makes you money!

 

Thinking that you will simply put your business model in place and wait for the sales to come is not really what I would consider a marketing plan. You don’t like to make plans? Well forget about making money from your business. If you can make it without creating a plan, means that any bozo can replicate your model tomorrow morning and become your competitor. And this is what is likely going to happen within 2 years. We all want to make money without really working and without really sitting down to determine where we are going. Unfortunately, this is not how it goes. I started to make serious money from my sites when I started to consider my business seriously. And this starts with a monetization plan.

 

How to Build a Strong Monetization Plan

 

In all honesty, it’s not that complicated to build a monetization plan. This is valid for any business idea for any type of model. Once you have your idea setup, you need to establish 2 important steps:

 

#1 How are you going to provide your product/service?

 

It’s important to know how you are going to run your business. For my network, I just couldn’t simply think that I would write every single article and ride the wind. I sat down with my partner and we determined who will do what and when. This is how we determined the number of writers we need, what they will write about and how the content will be published.

 

Providing good content (or a great product/service) is one thing, getting traffic (or potential customers) is another. In the “How to provide” you have to include a “How to get customers”. Let’s face it: you can have the best idea in the world but with no sales, you have nothing. Numbers are the reason why a business is called a business. And sales determine those numbers!

 

Getting readers on your blog is as difficult as getting clients for your business. There are competitors and your presence may be ignored in the flood of advertising we face each day. This is why you need a plan to stand out from the crowd and catch people’s attention. You can do it through various methods, here’s a few that we used:

 

A) Write Controversial Articles

 

These articles have single goal: establish a controversial point of view on a topic that touches people. You need to think a while about your topic as you can also look like a goof if you just argue with someone just for the sake of it. These articles usually draw attention to your blog and generate a lot of comments.

 

Examples:  Primerica Review, Not Selling Your House with a Real Estate Agent, Quitting my first job, Quitting on paying off debts.

 

B) Write “Trendy” Articles

 

Trendy articles are usually picked-up by social networks. You can get traffic for several months from social media if you pull off a great article. Lists are usually a good type of article to garner attention.

 

Examples: 30 Financial Moves Before You Turn 30, Top 10 Dividend Stocks in Canada, Famous and Not So Famous Songs and Finance

 

C) Long And Useful Articles

 

These are usually articles that have so much content that people will share them with their own network and will likely bookmark them for future reference. I have started to write more of these lately in order to increase my loyal readership. This also includes “how to” articles

 

Examples: How I Run My Online Empire, $18,403 to $124,514 in a Single Year, CFP Vs CFA, How I got 3 Salary Increases in a Single Year, Hitting 6 figures at 28.

 

#2 How are you going to make money out of it?

 

You have a great product, you get traction from customers, and then, you think of monetization strategies. Making money from your clients is crucial if you want to continue running the business. It’s always nice to catch people’s attention, but once they come, they need to buy! Your closing rate is as important as how many people that visit!

 

I’ve seen sites with over 1,000 visitors per day but with little conversion. Therefore, your visitors become useless! Over the year, we have worked on several strategies to make money online. The goal is to automate most processes so they can run automatically:

 

This is why we built newsletter funnels to direct readers towards affiliate products that will serve them.

 

This is why we built eBooks so we can advertise them on our sites and people will likely buy them if they like what they read.

 

This is why we have our main sites redesigned with Adsense Optimization to make sure we increase the number of clicks per page.

 

Some people are more creative and more successful than us. But so far, I can say that we have been able to show some good returns J.

 

Final Thoughts on Your Business Ideas

 

If you really want to be successful in business, you can’t be involved in all aspects all the time. Therefore, you need to find a way to streamline the process, in whole or partially. For example, once we designed our newsletter funnel, we developed a package ready to be sent to all our subscribers. Within this package, we have different affiliate offers to make our readers’ lives better. Once they sign-up, we don’t have much to do with them. We only have to focus on getting more subscribers and the rest will flow.

 

Each monetization idea should be tweaked and optimized to reach that level. This is how you can reach passive income to some sustainable level. But first, you need to wrap-up your mind and make sure that your business idea makes sense!

 

Now, do you have a business idea that passes the 3 killer questions test? If so, what are you waiting for???

 

 

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Comments

Great write-up TFB, another bookmarkable article.

I’m not waiting, the wheels are in motion!

I actually ignored or didn’t really think about any of your questions the first full year of blogging. I just wrote for fun.

Only after the 2nd year, and until the 3rd year when I quit my job did I really start to think hard about the business. It’s made a big difference, but it doesn’t take TiME!

Here’s to patience!

Sam

Hey Sam,

To be honest, I haven’t asked those questions myself until 2009! the first years of blogging was only for fun and I didn’t really know where I was going with this!

Great information here – and particularly useful for me as I just launched a new program and have been putting everything together for the past 2 months…

Traffic to my blog & webinars seems to be my current challenge. Slow & steady wins the race I guess… ;)

Cheers,

Derek

I’m not sure if I asked those questions in that particular order, but I would like to think I’ve asked them. And I think after some time of thinking through various ideas, I’m come up with a conference for women. An annual conference that at it’s core focuses on women innate abilities to financiall empower themselves. Each conference will have a different focus with different speakers. I’m looking forward to my first one!

This was an excellent article…very informative and powerful!

Nice summary of the concepts I heard in Fast Trac New Venture!

It’s hard to write that business plan!

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