Information Missing from Entrepreneurs’ Pitches (5)

Information Missing from Entrepreneurs Pitches 6
-Customer Relationships-


This building block dictates the nature of the relationships that an organization will develop with its various customer segments. Remember in the customer segment box we learned exactly who our client was, where they lived, how they purchased, and many other things (we learned the archetypal client). This is the fun section for me, because now that we have a thorough understanding who our client is, its time to GET-KEEP-GROW the customer base. Lets look at each one of these three sections individually. I will be using my new chain of restaurants, called Bella’s, as an example throughout this article.

GET. Getting clients into your pipeline can be broken up into two categories: Paid and Earned.

Paid Media. This would be things like advertising on TV, radio, newspapers, buying Google ad words, etc. What we did at Bella’s restaurant was to start a Facebook Page and boost every posting we made. We started off with posts on the first day of construction and continued until opening night. Clients told us how they felt a part of the development. We did advertising on radio, TV, and magazines two weeks before opening to flood the market. This was a very direct type of marketing since we already knew who to target from our customer segment interviews

Earned Media. This is public relations. This is the best type of media money cannot buy. Bella’s started off by sending press releases to all the media outlets in town, because they are all looking for content and love local stories. From that point, they requested interviews for their news programs ore news papers. This campaign started two months before opening. On opening night there were three TV stations, two newspapers, and two magazines that came and wrote about the event. All this publicity cost us nothing!

So, now how does one acquire, and, once in the pipeline, activate their potential clients? This is the first of three sections of the Get-Keep-Grow model.

Acquire. Customer acquisition is the process of persuading a customer to select your organization’s product or service over the competition’s. A number of mediums and tactics are available for entrepreneurs today who are interested in acquiring customers for their business. Here are a few:

Content Marketing. For entrepreneurs with limited resources, content marketing is a very appealing and useful alternative. This is your branding (i.e., logo, website, company story, fliers) and any content that you put together about why you exist in the market place. Bella’s created their logo and trademarked it. Our story was about my parents-in-law coming from Rome to do our cooking. We filmed all this and added it to our content.

Search Engine Optimization. Now it’s time to take your content and share it with the world. The more people who are exposed to it and share it, the higher your content will rank in search results, which is one of the most effective ways of getting your product noticed by your target customer. I do not believe in hiring an SEO. I do it myself, as should you. We placed everything on Facebook, Instagram, newspapers, TV etc. All this goes on the web and increases your visibility

Email Marketing. On Facebook we would have competitions for a free dinner on opening night, and continue to do so even now. For the entry, we get the clients’ names and email addresses. We also get this information when they make reservations. This information is rich and the best way to get to your clients directly. We then use Constant Contact to send out weekly emails with promotional material and specials of the weekend.

Social Media Marketing. You cannot be dependent exclusively on social media to get the word of your product or service out in the market. When used in collaboration with other tactics, however, social media can elevate your product significantly in your target customer segment’s estimation. It is much easier to target a specific market using social media than other forms of advertising.

Conversion Rate Optimization. The more your company starts attracting customers, the stronger your chances are of acquiring them by making minor tweaks to your content and outlook.

Analytics. It is not just enough to mobilize word of your products through the media mentioned above. If companies do not use data gleaned from one or more of these resources and analyze it to better understand their customers, they are not taking full advantage of the investment they have made.

Customer Retention. This refers to the long-term relationship a company establishes with its customers. The more repeat customers a company has, the more it is assured of champions who will market its products and help it acquire additional customers.

Below are some strategies businesses can use to retain their customers and form long-term relationships with them.

Stand for Something. Customers are more loyal to brands that they identify with, or those that they feel represent traits and characteristics that they would like to emulate. Therefore, it is imperative for a company to select what its brand stands for and communicate that to its customers.

Utilize Positive Social Proof.  Websites that provide customers with facts that show how the use of their product will improve their social standing are more likely to help the company retain customers in the long term.

Invoke the Inner Ego. Customers are automatically more inclined to a product based on how much it reflects qualities that they feel exist in themselves. This is called implicit egotism, and can be a very effective weapon. Companies need to know their customers inside and out, have a complete understanding of the language they speak, their wants, needs, and desires to be able connect with them, and show them how the company and its products are an extension of themselves.

Use Words They Love to Hear. Certain words have a deep impact on the buying behavior of customers, and if the product fulfills the promise of these words, customer retention becomes easier.

Reduce Pain Points and Frictions. If you address a pain point for your customer, or resolve a problem for him, you will retain him for much longer.

Realize That Budget Is Negligible. Most companies balk at giving back to customers without realizing that giving them a discount, even if it is a small one, will wow the customer and keep him coming back for more.

Utilize Surprise Reciprocity. Surprising the customer by providing them with a boon (like a discount or a free add-on) will stay with the customer longer.

Make It Personal. By providing a personal service to the customers, you increase your chances of creating a repeat customer.

Speed Is Second to Quality. Often times companies make the mistake of picking speed of service over quality, thinking customers would appreciate the tradeoff. However, studies have shown that customers are more likely to come back if importance is given to quality.

Customers Enjoy Businesses That Know Them. The more time an employee spends with the customer, getting to know them and therefore providing a level of personalization, the more likely he is to reassure the customer that the company truly knows him and therefore keeps pulling the customer back to the brand.

Choose the Right Platform. It is important to know what communication channel is preferred by customers, and to utilize this channel to the fullest extent in order to keep the company’s presence ensured in the customer’s psyche.

Make It a Communal Effort. All elements of the organization must be fully engaged and informed when it comes to servicing a customer. The aggregated effect will greatly improve the overall experience.

Get People Started. Loyalty programs are more likely to be used if companies get past the customer’s initial resistance, and ensures that customers are automatically signed up for such schemes. Once the ball is rolling, customers are more likely to stay the course.

Get Ideal Customers to Be VIP’s. Humans are competitive by nature, and studies have backed this observation by showing people appreciate being assigned to a particular customer class if there is a class below them in the program.

Label Your Customers. Customers are more likely to keep coming back if associating with their brand puts a label on them.

Boosting Sales (Upselling)

Companies are forever focused on increasing their sales, and often use a strategy called “upselling,” which requires representatives to convince the customer to buy more of their company’s products. By using a combination of linguistics, packaging products and lowering their overall price, and selling dependent products, companies ensure that a customer buys as much of their products as possible.

In fact, companies often provide incentive programs that reward employees who manage to boost their sales through the technique of upselling, and ask others to emulate the techniques and tactics those employees use. However, such incentive programs are kept strictly under wraps, because if a customer gets to know about them, it may break the tenuous relationship of trust between the customer and the customer representative.

Typical upsells that you may have experienced can be: asking a customer if he would like to add a drink or fries to his order at a fast food restaurant; convincing a customer who is getting his laptop fixed that he should get more RAM, or a bigger hard drive installed; suggesting to a customer who is getting his phone fixed that he should upgrade to a newer version of the handset, etc.

Typically, there are two techniques that successful upsellers often utilize. Successful upsellers are many times researchers and observers who get to know their customers’ profile, particularly focusing on their economic status, demographic, preferences, and social aspirations. This helps the upseller to customize his pitch to the taste of the customer.

Another technique that is common among upsellers is the use of fear. By letting the customer know that the product might go out of stock due to demand, or getting them to buy after sales services or warranties for expensive items by letting on that the product is sensitive and needs to be handled by expert hands.


For more information about starting a company or new product development, please feel free to contact me at


Blanks, S. (n.d.). (2015, November 13). Business Model Canvas, Udacity. Retrieved from


Information Missing from Entrepreneurs’ Pitches (4)

Information Missing from Entrepreneurs Pitches 4
-Customer Segment- 
I cannot tell you how many times I’ve asked new start-up companies how many potential clients they’ve talked to about their great breakthrough, and have received the disappointing answer, “none.” This is so disheartening to me. I learned a long time ago, when I started pitching to investors and studying the Business Model Canvas (BMC), that I needed to find out who my customer base was going to be. To do this, one needs to get out of the building, so to speak. First, one must do research on Customer Discovery (find the problem) and Value Proposition (create the Minimum Viable Product). The Customer Validation phase begins when you take the Minimal Viable Product (MVP) you have developed and go back to as many potential clients you have spoken to, and see if your product or service is the right one for your customer. This is called the Customer Segment of the Business Model Canvas.

The Customer Segment is one of the most important building blocks in the Business Model Canvas, so getting this right is key to your success. By matching your customer segment to your value proposition, you can achieve a more lucrative revenue stream and develop a Product Market Fit (briefly discussed in last week’s article). This part of the BMC can only be done outside of the building by interviewing hundreds of potential clients. Your customers can be segmented into different groups based on their needs, behaviors, and other traits they share. A customer segment can also be defined through demographics such as age, ethnicity, profession, gender, and more. We can also break this down into other factors such as spending behavior, interests, and motivations. Then, the organization must create a value proposition, and employ a business model best suited to servicing their chosen Customer Segment’s needs.

The Customer Segment part of the Business Model Canvas will help the startup discover the following:

Creating a Customer Profile:

Who Is My Archetype? In order to ensure that a start-up’s product or service appeals to its customer segment, the business must work to understand who the customer really is. This can be discovered by evaluating the customer’s environment, experiences, and general social context. This is called “living in the day and life of your customer.” By learning what your customer does from the minute they wake up until they go to sleep, you come to understand exactly where your product fits in their lives. All of these factors contribute to how the customer will respond to your product. So, a customer’s geographic, demographic, and social context will define the customer’s persona, creating a customer archetype for your products and services.

Customer Gains. We have to ask ourselves what outcomes our clients expect, and then widen our lens to discover what we can provide for them that would go beyond their expectations. Is it quality they are looking for, or more of “this” and less of “that?” Could it be features they are looking for, or perhaps better performance? What would make your customer’s job or life easier? Could it be more services, lower cost of ownership, or removing a step from a cumbersome process? And what would increase the likelihood of them purchasing your product or service? Is it cost, better quality, lower risk, more fun? The answers will differ if you are selling to a business customer rather than a consumer customer, but regardless of your customer type, these questions all need to be answered in the Customer Segment of the BMC.

Customer Pains. This part is the part that is easiest to identify. It’s seeing clearly what exactly is causing your customer hardship, and making sure your product or service will alleviate it.

Customer in Context. Selling a product or service from business to business is much different than selling to a consumer or end user. Within a corporation there will be people who use the product, people who would recommend the product, and people who are the actual buyers of the product. But the people you really have to look out for are the saboteurs. A great example of this is when one of my companies, Bisenti Technology (, went for its first big project with one of the largest Hedge Funds in America. We knew who the economic buyer was (the CFO), we knew who the end user was (the marketing and sales departments), but we had to understand that the I.T. department was going to be our saboteur. They were worried that we were going to take their jobs instead of understanding we were there to help them. Knowing the chart of players before going in gave me a strategic move that helped us win the contract.

With all of this information in place, it is time to hit the streets and start testing your hypothesis. I ask myself the following questions as I engage in this real-life stage of the Customer Segment:

How do you test your customers’ interest?  I use what is called a Minimal Viable Product (MVP). This contains the core features your product or service delivers. I watch the customer’s eyes as they review my solution to their long-standing problem. If they light up, I know I am in. If not, I ask questions and iterate.

Where do you test your interest?  When I started Credit Justice Services (, I went to over 100 mortgage broker offices with my MVP, showing them the solution I had to their problem. When I started Bella’s, a new chain of restaurants (, I placed a picnic table in the middle of a defunct restaurant, and cooked for 15 people every day for six weeks until I knew I had the recipes just right.

What kind of experiments can you run?  I try to keep it as simple as possible. When I came up with a new Italian red sauce at my restaurant, Bella’s, I tested 500 people who sat at my bar and did a blind taste-test with 10 other red sauces. This gave me enough data to figure out what I needed to do to be number one.

How many do you test?  This is simple. The larger the data set you have, the more the accurate information about your product or service will be. I try to never to go below 100 users.

For more information about starting a company or new product development, please feel free to contact me at


Blanks, S. (n.d.). (2015, November 13). Business Model Canvas, Udacity. Retrieved from


Information Missing from Entrepreneurs’ Pitches (3)

Information Missing from Entrepreneurs Pitches 3
-Value Proposition- 
According to (2015), “Value Proposition refers to a business or marketing statement that summarizes why a consumer should buy a product or use a service. This statement should convince a potential consumer that one particular product or service will add more value or better solve a problem than other similar offerings will” (p. 1).

The question I like to ask my clients and students who are starting a company is: “why would I buy their product or service instead of the company’s next door?” They normally come back at me with the types of features they have, or the coolness of their product. The Value Proposition is asking what pains and gains I will receive from using your product/service instead of the other company’s. Let’s look at what that means.

What is it you are building, and for whom are you building it?

What pains are you removing, or what gains you are creating?

Pain Killer.  What are you going to reduce or eliminate for the customer? Is it wasted time, cost reduction, emotional frustration, or risk removal?

Gain Creator (The Solution). How do you create benefits for the customer? Is it through exceeding their expectations and desires, or will they be surprised by the ease of the solution?

Once you have gotten out of the building and interviewed hundreds of potential clients in your customer-discovery phase of this process, you then come back to the lab and design a Minimal Viable Product (MVP) from what you learned. What is the Minimum Viable Product? It is the smallest feature set you can create to show the potential client that it would solve their pains or create gains. This is where I see clients and students go off the rail, especially engineers. They come up with a 50-feature set of ideas, and have no clear vision of what the customer wants or desires. This will only confuse the potential client and drive them away. You need to make the MVP as simple as possible to understand. Remember, you will be returning back to the client with your MVP,  saying, “This is what I’ve created to solve your problem. Is this what you were talking about?” Other features will add on after launching, depending upon the customer feedback.

There are two types of MVPs — Physical and Web/Mobile. Let’s look at each:

Physical. This is a product that will be sold through a direct sales channel, so you will need something that the customer can touch or feel. If not, I have my students go out with a power-point slide deck. This will test the understanding of the problem and solution. It will also help you figure out the minimum features the customer desires.

Web/Mobile. You need to start with a low-fidelity website. This means you need either a wire frame, or a power-point mockup of what you are creating. Remember to keep it simple. This is so the customer can understand what you are trying to solve or create. I would advise that you get a high-fidelity feature a few weeks after your customer interviews, which would include a more detailed webpage and an actual back end that works. This will help you develop something the customer wants and desires, without trying to figure it out yourself and wasting a lot of time while doing so. I love this process, because all you need to do is just ask the client, and they will tell you what they want!

What most start-ups don’t understand is that it’s not about your idea or product, but about solving a problem or a need for a customer. So, what does that mean, and what is the difference between a problem and a need?

Problem. This is solving an accounting  problem or a company systems problem.

Need. This is universal, and is therefore wanted by the billions of people on the planet. Great examples of this are communications, entertainment, and even love. EHarmony tapped into this like no other company. Apple also took the iPhone and turned it from a problem of communication to a need that resulted in people wanting a new one every year.

The Value Proposition works hand-in-hand with the Customer Segment part of the BMC, which I will be writing about next week. When a start-up can connect the two (Value Proposition and Customer Segment), we call that a Product Market Fit. This answers the question, “Is what I’m building needed, wanted, or desired by the customer?” The great news about the Business Model Canvas (BMC) is that you can iterate (make small changes) or pivot (go in a totally different direction) between the Value Proposition and the Customer Segment during the Customer Discovery stage until you get it right. When this is accomplished by a start-up, the chances of success increase significantly.

Most start-ups only look at what their actual product or service Value Proposition will bring to the client. I ask my clients and students to look at the whole package to be delivered to the customer. Here are a few questions you need to ask yourself about your product or service:


What are the parts of your value proposition? Manufactured goods, commodities from other lands, etc.?

What are the entanglement parts of your value proposition? Perhaps copyrights, the licensing, or something else?

Are there financial parts, like insurance you offer, financial guarantees, and so forth?

Is it digital, like MP3 files or e books?


Which core services are part of your Value Proposition? Is it consulting, a haircut, investment, or advice?

Which presale will you offer? Is it to help the client find a solution, financing, free delivery?

What after-sale services will you provide? Is it free maintenance, disposal of product, etc.?

The Value Proposition is the part of your product and service that states exactly why the client would rather buy from you than from your competitor. It is the part that describes what pains you will be removing and what gains you will be adding.

For more information about starting a company or new product development, please feel free to contact me at

Blanks, S. (n.d.). (2015, November 13). Business Model Canvas. Udacity. Retrieved from

Investopedia. (2015, November 13). Value Proposition. Investopedia. Retrieved from