In the last episode with Kate Toon, we discussed how to build a digital business from scratch by growing and leveraging a community. In today’s episode, we’re going to discuss some key principles from Kate’s book Confessions of a Misfit Entrepreneur and several ways we can provide value to our customers.
Finding Our Superpowers
Part of our entrepreneurial journey should include discovering our superpowers. What are we the best at? If we want to provide value to our customers, we need to figure out what we are good at. What value can we offer? As we discover our superpowers, we will begin to resonate with our audience.
“It’s really good to identify what your individual superpowers are rather than trying to fit the mold of what society tells you have to be, the superpowers [you must have] to be a great business human,” Kate said.
As we search for our unique superpowers, we can look for help from the people close to us. We may not be the best judge of our own superpowers. Often, the way we perceive ourselves is different from the way others perceive us. Kate suggests we ask our friends and family how they would describe us in two or three words. This can help us discover talents and abilities we may not have realized we had.
When we discover what we are good at, we will also have more knowledge about our weaknesses. “Sometimes our superpowers are also our kryptonite. They work both ways. My honesty is great, you’re always going to get a straight answer from me, but sometimes my honesty can be a bit brutal, and people aren’t going to like that. But it’s who I am, and I have to own it,” Kate said.
In my career, someone taught me that our strengths and weaknesses are like a stick. When we pick up a stick, we pick up both sides. One side of that stick is our superpower, it’s our talent, it’s the way we are going to change the world and make our greatest contribution. And the other side of the stick is our weakness. For example, we might have a salesperson that’s really good at relationships and communicating, but on the other hand, they’re just not as a detail orientated and we’d never have them manage the books.
Every superpower has an associated weakness, just like Superman has his kryptonite. We as entrepreneurs may judge ourselves based upon our weaknesses. However, we should focus on our individual strengths and use them to our advantage. We can also find other people to help bring the skills and talents we lack. It takes a village to run a business. Sometimes we just need to find that business partner or employee who can have strengths to make up for our weaknesses.
Navigating the business world is difficult. The only real way we can successfully make it through is by building our confidence. We need to recognize our strengths and use them to add value, while also recognizing our weaknesses to improve them. As we focus on our strengths and get help with our weaknesses, our chances of success and monetization will increase.
The Road Map
Kate doesn’t use a business plan. Instead, she creates micro goals and a rough roadmap of the direction she wants to go.
We don’t need to create an entire business plan to have a successful business, but we do need to have the main goal. We need to determine who we are, what we stand for, what our values are, and how we can use our strengths to help others. Once we have our main goal and direction in mind, we can sketch a rough road map of where we want to be in a year, five years, or 10 years. However, we don’t need to plan out every single step of the way from the beginning.
Following this philosophy, major business plan competitions have switched to business model competitions.
Once we know our goal, we can begin building our website. This should be a very strong foundation for our customers to always go back to when they have a problem or question. Then, our goals can lead to processing, pricing, branding, and eventually marketing. We can also start to bring in people to fill in the gaps of our weaknesses.
We don’t need to have a set-in-stone plan. We need to be flexible, and if we have a strict business plan we are determined to follow, it may cause us to get stuck. Instead of a firm plan, we can create a road map with different possible routes and paths to take. When we are moving towards our main goal, it doesn’t matter how we get there, as long as we do.
10 Ways to Provide Value to Our Customers
In Kate’s book, she discusses her value ladder. The first step is for her customers to join her Facebook community. This is a very low barrier to entry as it requires no commitment or cost while providing the value of building a network and gaining access to content. All customers have to do is provide an email. Some of the content at the base of the ladder includes her podcast, blog posts, events, and content in Clubhouse. The goal of this content is to raise awareness about her business and expand her reach.
At the next step of the ladder, Kate offers additional free value through the customers’ emails. Customers can get access to free online courses, resources, and a workbook. Once her customers are enticed by the free value and continue to climb the value ladder, the value being offered increases with the cost. Kate can attach a price to her content since it is becoming more valuable to her customers.
She begins with a low-cost online course on SEO that is about $87 and eventually leads to a master class for about $1500. These masterclasses can also lead to membership and coaching sessions which generate recurring revenue.
Here at 10 ways, Kate provides value to her customers:
2. Blog posts
7. Online courses
At each step of the ladder, Kate provides new value. It starts with little to no cost or commitment and eventually moves to the content of higher value with a higher cost or time commitment such as a monthly subscription. The value ladder works like a funnel, with Kate’s ultimate end goal being to get people to sign up for the membership site so she can generate recurring revenue.
However, with memberships, we have to be careful to avoid overloading and overwhelming our customers with content. “Memberships are about transformation,” Kate said. “They’re about results. People want to see that they’re moving forward and making changes. And content actually overwhelms people, because they’re like, ‘Wow, I’m not getting through all this content, therefore I’m not getting the value from this membership that I should, so I’m going to leave.’”
Instead of including limitless content in her memberships, Kate works with a “less is more” approach. They include a couple of master classes each month on topics groups vote for. Instead of having 100 master classes to look at in one month, customers are introduced to two or three new classes each month. She also provides training each month, reviews, and a one-hour coaching session.
“[A membership program] is not about a lot of content, but it’s trying to give people a personal experience as much as possible,” Kate said. “I think a good membership is about education, but it’s really about support, community, . . . and coaching.”
One of the main goals with Kate’s value ladder is to get customers to subscribe and provide her with recurring revenue streams. Recurring revenue is a security measure. While Kate makes a good amount of money from her online courses, it’s a one-time purchase. What happens if she launches a course that fails?
“[Recurring revenue] is just about that security. It means I can make more intelligent decisions, I can afford to have a team, [and] I can make promises to my team about their work and how long they’re going to be around for,” Kate said. “It means I can sleep at night.”
As we find our superpowers, sketch out a rough roadmap, and create a value ladder for our customers, we will begin to find success in our businesses.
Thank you so much Kate for sharing your stories and insights with us today. Here are some of my key takeaways from this episode:
1. We should seek to discover our superpowers. If we want to provide value to our customers, we need to figure out what we are really good at.
2. Every superpower has an associated weakness. Sometimes we may need to find a business partner or employee who has strengths to make up for our weaknesses.
3. We don’t need to create an entire business plan to have a successful business, but we do need to have the main goal or a business model.
4. We can create a value ladder with multiple different types of content to give our customers to guide them towards a purchase decision.
5. Recurring revenue gives our business security.
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