Change your market, save your product
The father of my daughter's friend is an arborist. He makes his living pruning and caring for trees, and he's owned his own business for 12 years.
His first years of business were tough. He was grinding hard, and working long hours, but wasn't earning a substantial amount of revenue.
And then, he found his solution.
He changed his phone number.
Up until then he'd been focused on his local market. But there was a problem: most of them were retired farmers. There's nothing wrong with farmers, but they're DIYers. If their trees need pruning they do it themselves.
However, looking at a map he saw an opportunity.
There was an affluent suburb located twenty minutes away. Most of the residents were executives. They didn't have time to care for their trees; they needed someone to do it for them, and they have the money to pay for it.
So, here's what he did:
He switched his phone number to a number local to that suburb.
He opened up a PO box there as well.
He started advertising in their yellow pages (this was in the 90s), and their local paper.
The result? The next year, 95% of his revenue comes from this new market.
In hindsight, it seems obvious:
Find a group of people who want your service, and have the money to pay for it.
Maybe your product is fine, but you haven't found the right customer.
Target a new market for your software product
One of my SaaS clients had been toiling away in the B2C market for years. Their product was $19/month, and just wasn't profitable.
To make matters worse, they were attracting hobbyists and prosumers that were hard to please. These customers kept chewing up hours of customer support time.
So we decided to change their target market.
We focused on a new B2B niche. Then we took these steps:
We cancelled their freemium plan.
We raised their base price to $99/month.
We chose a new brand name.
We re-did all of their website's copy so it spoke to the new target market.
The results? Revenue increased, and customer support decreased!
Before you throw in the towel on your startup, it might be worth tweaking your product, and offering it to a new market.
Cheers,
Justin Jackson
@mijustin
PS: want more? Check out my book! You can download a 21 page sample here.
This blog post was originally published on July 29th, 2011. It's been updated since then.