There are many reasons why businesses don’t make it, but undoubtedly, the primary culprit is a lack of profitable clients.

Jagz Mario via Flickr

I know that should seem obvious, but if more people truly appreciated this fact, they would go about their business in an entirely different manner.

Most businesses are started by people who think they know how to do something or think they want to sell something. In other words, most businesses are started with the business in mind.

But, if we actually understood that the only thing that mattered was an abundant volume of profitable customers, we would surely start with the customer in mind, right?

Customer focus vs. business focus

Another way of saying this is that instead of starting a business and then going out and finding customers that want to buy what you sell, you should go out and find customers and then build a business around what they want to buy.

In this model you really only have two jobs to master. First, you must come to understand precisely what your market will pay for and then you must build a repeatable sales system that allows you to profitably get it to them.

Get customer discovery and sales right and you can’t fail.

No matter if you’re an accountant, consultant, plumber or jeweler, your main job is to get out there into some segment of the market you hope to serve and ask them what they want, what they don’t have and what they are willing to pay for, even if what they want isn’t what you want to sell – or maybe especially if that’s the case.

Until you fully appreciate this idea your business is a crapshoot at best.

Now, I’m not saying that you’re going to base every decision, every feature, every twist and turn on customer feedback, but I am saying that you need to stay very close to customers and prospects as you think about your offerings and test everything with them until you land on a value proposition that gains traction.

Test and evolve

Before you launch a business or product test your assumptions – test your packaging, pricing, bundling, message, products, services, branding, revenue streams and business model with some segment of your market and pay attention. So often, what seems crystal clear to us makes no sense when unleashed into the wild.

This is not the same as research really – this is more like constant, real-time feedback and it involves constant testing, including what the customer experience is like after they buy, why they might buy more and what it would take to get them to refer you.

Build a sales action process

This is a process and the aim of this process is to figure out how to create profitable customers before you commit to what your business actually does and offers.

Once you do this, you can move to building and scaling a marketing action plan that turns this process into consistent and predictable results.

Then and only then, will you build a business that cannot fail.

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John Jantsch

John Jantsch is a marketing consultant, speaker and author of Duct Tape Marketing, Duct Tape Selling, The Commitment Engine and The Referral Engine and the founder of the Duct Tape Marketing Consultant Network.
  • In my case I think when I first started on my own I just wanted clients forgot about the profitable part. I had many clients which where non-paying or non-profitable. 

    Now I rather spend more time focusing on the ones that are willing to pay for my services at a rate where it can still be profitable. 

    I need at least a post every few weeks like this one to help me re-focus. 

    • “I rather spend more time focusing on the ones that are willing to pay for my services at a rate where it can still be profitable.”

      I agree with this, Raul. I set an hourly rate, and even though I generally quote per project, I don’t go below that.

      I think the points discussed in this article also help you determine who your ideal customer is. If, for example, you aren’t finding people willing to pay your desired rates, you may have more success simply targeting more profitable clients. Of course, there is only so much people are willing to pay for different things, so that’s still something to remember.

  • Nice one. Customer is god in Japan. Good advice. Not followed at all here in Australia.

  • Thank you for posting this great article. In establishing a work from internet like online business or even a traditional business, the key factor on your way to success is your niche or market. It is very important that in every endeavor you should think first about your niche and let me just add that another factor with regards in targeting your niche it is important to discuss the products that  are hottest in every age bracket. I am looking forward for another article as great as this one.

  • OBVAVirtualAssistant

    Building a brand is an essential factor that could give your marketing business a great progress. So finding customers before any business is the way its going to grow.

  • Listening to the market, listening to the clients, listening.  One of the most important tools in selling, marketing or when you have your own business is listening.  You can never go wrong if you know how to listen and that also comes with having an inquisitive and analytical mind.  I agree with you John when you said it’s not in the position you’re in – a plumber, jeweller – it doesn’t matter.  As long as you ask your clients what they need and just being a good listener.  Then everything will just follow.

  • John… I find that a lot of small businesses feel like it’s a responsibility to try and work with every client that comes their way.  I know I have this feeling some times.

    Definitely can be a big mistake!

  • John,

    Thanks for the great advice! Dave Brock, the CEO of Partners in EXCELLENCE, wrote some advice for SMBs. I’m surprised by how much it echoes your sentiments here:

    Thanks again!

    Seth Resler
    Content Manager

  • I definitely agree that it is very important to know and understand your market because once you failed to hit this one, it would create
    a bad domino effect on your business.  Building and maintaining a business is a long term learning experience, it also takes commitment, dedication and passion to follow the principles mentioned here to build a business that cannot fail.

  • John, really spot on advice as ever. I’ve been struggling to
    find a representative phrase for this kind of continuous experimentation and
    real learning. It’s been exemplified in Eric Ries’s Lean Start-up movement, but
    is arguably even more important for existing businesses.

    Set a target, implement, measure, analyse the results,
    change one thing then do it all again. It’s good scientific process and turns
    the BS of customer centric approaches into really putting what the customer
    wants and is willing to pay for at the centre.

    As a great example we encourage our clients who start a new
    product or service (or business for that matter) to buy a few dollars’ worth of
    pay per click ads. Not to gain exposure, but to let them scientifically test
    with real evidence what their potential customers really do, not what they
    think they might possibly, maybe do. If Henry Ford had asked customers what they
    wanted they’d have said faster horses not strange mechanical ones.  
    I don’t usually add personal links into comments, but this takes this dicussion further and there’s a very interesting challenge in the post so worth a look.
    Chris Markham

  • Great insights John. My experience is often many clients have a vague idea of what they want, usually solve an immediate pressing problem, but are too “in the weeds” to really understand what they need.

    My best clients, my most profitable clients, are those willing to try me on the pressing want and willing to invest in doing the soul searching required to discover what they really need.

    You’re right, packaging and testing “want” offers to attract clients is vital. However, lots of times, this initial testing, packaging, etc. is painful on profits until we discover the sweet spot that sings with clients and provides long term value.

  • I believe if anyone reads this post that has not yet started up their business, they will have an easier time building their customer base.

    I appreciate this excellent post, John. You are absolutely right about new business owners focusing on the business and not the customers.

    Thank you!

    Stacie Walker

  • info

    you have done a great work ………. its really working and important for us. so please keep sharing ….
    Branding and Advertising

  • Jody Hollis

    I agree completely. I have spent a lot of time selling a solution looking for a problem. However, what about the trailblazers?  

    “If I had asked people what they wanted, they would have said faster horses.” ― Henry Ford

  • I really wish someone would have told me ten years ago that business has the same approach as science/comp sci. I would have been way more successful in my own business (and probably made less fun of the management kids). 

  • Nice post John!
    Boil it down to simple….customers and sales.
    That solves a lot of the problems.

  • brentmkelly

    Great insight John. I think sometimes we make things more complicated than it really is.

  • First, you must come to understand precisely what your market will pay for and then you must build a repeatable sales system that allows you to profitably get it to them.