The main reason some African businesses fail is not for lack of capital – it’s for lack of knowledge. Knowledge in your business – most important, how to run your business, is the most potent weapon you can have. It often means the difference between a good and a great business, as well as success and failure.
That said, one of biggest mistakes most would-be entrepreneurs make is going into business based on what they think people should buy, rather than what people really want or actually do buy.
Here is how you can use knowledge to your advantage and stay ahead of the pack:
1. Identify your customer.
You need to first of all identify who your ideal customer is going to be. Knowing your customer will tell you what to sell to them. Questions like, “Is the target male or female?”, “How old are they?”, “Are they married?” — as well as deeper questions such as, “What was their main motivation purchasing a particular product or service?” Knowing who will be buying your product or service is vital to your business success – how else will you find your customers if you don’t know who they are?
2. Test and measure demand.
As an entrepreneur, conducting a feasibility study of your new idea is very important to the survival of your business idea. What you need to do is to ask friends who are willing to tell you the truth about the product or service you are bringing on board. Big companies spend lots of resources testing ad campaigns and hiring focus groups, but you can do a lot more effective research on your own by simply starting small – then testing and measuring everything you do.
Now you have to develop a marketing strategy to make sure these potential buyers know about your great new business. With today’s internet capacity, marketing can be relatively low-cost, using online coupons and mailing lists. Brainstorm ideas with friends and family, and look at what your competitors do to get new businesses.
4. Start your list of contacts.
At this point in your start-up and planning phase, you may have a list of vendors, suppliers or even potential customers. If so, great! Keep building that list and start to develop a communication strategy to keep in contact with that list on a consistent basis. Today’s contacts may be tomorrow’s customers. More importantly, they have access to entire networks of people who may want or need your product or service. The real goal of networking is not making a sale to your direct contact. It’s about creating a relationship with that contact that leads to referrals and word-of-mouth leads down the road.
Unless you’re lucky enough to find a hole in the market, your business will have competitors. Check them out, because your future customers surely will. Competitors can be a great resource to you as a start-up; you can see how much they charge, what marketing strategy they use and the location they chose. Ask yourself, how can I do better than the competition?
Timing is crucial, especially for a start-up. Opening an ice-cream shop in January is a bad idea. Do you expect your business to be seasonal? If so, time your opening to the strongest consumer demand. You’ll come out of the gates with a flood of new customers, customers who will come back for more.
In an era where many “crazy” ideas can become viable businesses raking in reasonable revenues you may want to follow through these success tips. See you at the top.
Author: Issah Adil, Event Planner at Russell Ray Promotions.
Was this article useful? Kindly leave your comment.
Source Beauty is pushing the boundaries of Egyptian e-commerce
Egyptian e-commerce: the county’s digital drive has not yet gotten to the growth typically seen in European countries and North America. However, as businesses have started shifting online, customers are now following suit, resulting in the gradual development of the digital eco-system.
Innovation, such as digital marketing, is reinventing the consumers’ path to purchase. The Egyptian e-commerce market is expected to grow at a rate of 33% annually to approximately $3bn by 2022, according to Oxford Business Group.
Source Beauty and disruption
The increase in e-commerce comes from rising internet penetration rates, driven by connected and digitally savvy millennials. Several platforms, both locally and internationally, such as the direct-to-consumer beauty platform Source Beauty, have disrupted the beauty industry in the region to drive their growth by truly connecting with their customers.
By being aware of the changing consumer behaviour trends in the e-commerce landscape, service providers like Source Beauty are continually fostering customer engagement with a community they have created. The customer service team, along with the editorial and marketing teams, respond to each comment and direct message, making customers feel listened to.
Lydia Schoonderbeek, the founder and CEO of Source Beauty, said:
“Egypt has traditionally been a price-driven market. After devaluation and high inflation rates, people have become much more price sensitive. People are consuming less and are shifting away from imported products due to price, accessibility and inconsistency in supply. As a result, they’re looking for local alternatives.”
In line with its digital transformation and financial inclusion agenda, the Egyptian government has set in place directives to raise the limit for electronic payments for individuals via mobile phones to EGP30,000 (USD1,905) per day, and EGP100,000 (USD6,350) per month, since March 2020. Traditionally, 70% of online purchases were cash on delivery, which has proven to be a major challenge to e-commerce growth throughout the region. This preference has changed to credit card payments, increasing to 30% from 16% due to the spread of Covid-19, but it remains to be seen whether purchasing behaviors will be affected in the long term.
The CEO of Source Beauty further added that, the company had seen substantial growth thanks to the COVID-19 global pandemic, with existing and new customers wanting to limit in-person beauty services and adhering to social distancing and mask-wearing requirements. Beauty customers, she says were changing spending habits, moving towards products that allow them to recreate the salon experience in their homes and protect them from the potential impact of an increasingly digital lifestyle. Finally, she believes they have seen customers prioritising skincare and haircare purchases over makeup.
The question is, ‘Is anyone in Egypt going to buy beauty products online?’. Who thought people would buy books on the internet from a website called Amazon! Well, the answer seems to be YES. Consumer spending in Egypt on non-essential goods has reached EGP 3.90bn in 2020 and is set to reach 8.81bn in 2021, according to FitchSolution’s 2021 Report.
According to the Egyptian e-commerce beauty company, Source Beauty, it believes that the world is in an era where consumers are looking to associate with brands and not products, to make their beauty purchasing decisions and this is where homegrown brands like theirs will doubtlessly lead to economic growth in Egypt.
Got News for us?
Submit Press Release/News: Have you recently launched your startup, raised funding or any news about your company? Email us at firstname.lastname@example.org. We will be happy to share your story with the world!