Making money is a gigantic win and is something every business should do. OK, I know that all sounds really obvious, but I don’t think a lot of people grok it fully. Any consulting company or freelancer can iterate for you a long list of people that came to them with a “great” idea, spent lots of money on it and made zero. Generally the problem is either the idea was something that people wouldn’t pay for or not charging people at all. Seth correctly points out in a recent blog post that although, in the near future, everything will be free, “people will pay for content if it is so unique they can’t get it anywhere else, so fast they benefit from getting it before anyone else, or so related to their tribe that paying for it brings them closer to other people.” And as usual he’s absolutely right. Extending his thought is the fact that people will pay for something they love or need that fits for them. That sentence is very different than “make something people will pay for.” It is different because it changes one’s perspective on the issue of making money. It’s very, very, very easy to feel excited about an idea and rationalize that people will pay for it. But focusing on people’s wants or needs forces you to make choices based on what people will pay for, instead of what you think (hope, prey) they will pay for. So the first rule in how to make money is to make something that people will love or need that fits for them.
People only pay for what they want or need when the price is low enough to be a greater value then the alternatives. Think about your own buying decisions: When the need or desire is great enough you buy when it’s not you don’t. If the price is too high, you look for an alternative or go without. Sometimes the need or desire outweighs the reality that you can’t afford it, hence the financial mess (debt) most folks put themselves into. But when the value is bigger than the other offerings, they buy.
As free becomes ubiquitous and there are thirty alternatives to your idea you have to make something they love (the value). And you do that by being ultra-super-focused: Focused on your people. Yes, they are your people, they are your flock and you have to love and protect them. And they can’t be a large group of people. Think small. Don’t be greedy and don’t try to solve everyone’s problem. Solving everyone’s problem means solving no one’s problem fully. This works fine when you are doing something that no one else does but everyone needs, or you can bully people into using it because you’ve already achieved critical mass in another related field (I’m looking at you Microsoft). The number choices are growing. We are heading towards a world of ubiquitous ubiquity where not only has everything been done, it’s been done a hundred times. The only way to get people to pay you in that world is by offering them something they love, and then they can’t live without it.
A client of ours (who came to us after many other developers and design shops worked on their app) recently launched a service that everyone needs. People are meant to pick categories to find what they’re looking for. The problem is there are over 1100 categories and sub-categories, starting with twenty top level categories and drilling down many layers. This sucks. It’s too painful. It creates a barrier of entry that is too big. I tried many times to convince them to start small and focused, to start with a service that serves a small niche and then expand as their user base grows. The answer always was “but what about the people that want farm equipment?” So now they have a site that works equally well for people looking for farm equipment or lawyers or vacuum cleaner repairman or taint waxers. So they made choices all along that forced them to be big and blah, and their road to being profitable is much harder than if they had focused on one thing. This bad choice forced them into many other bad choices, like picking a terrible, unprouncable and unspellable domain name, because anything easy was already taken. Had they chosen a more niche market they could have picked a name that is easier to spread. One bad decision usually leads to another and another until you have a mess so large you are unable to look back and see the original bad choice.
Focusing on making a small group of people’s lives easier is the key. If you always keep focused on that then it guides your decisions. Show them solidarity and they will reciprocate. Love them, bring them joy, protect them, the money will follow.
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