This foundational stage is where you turn raw ideas into a viable business. At Aqua Vita, we started with a branding and fundraising campaign with Engineers in Action.
That success story, and the impact they had on the world, lit a fire under us and fueled our growth. Seventeen years later, we’ve served almost 300 organizations, and our work has impacted the lives of millions of people.
Most of your time and attention in Stage 1 is going to be focused on four key areas:
We’ll also talk about your essential marketing mix for this stage later on. Let’s dive in.
Product Development
Most entrepreneurs have about 100 ideas per minute, and probably only one or two of those are viable in the real world. The first and most important thing any business needs to answer these questions:
- Does my product or service add value or solve a problem in my marketplace?
- Am I passionate about it?
- Can I be the best in my marketplace at it?
- Is there a perceived need for it in my marketplace?
If the answer to all four questions is yes, it’s on to the next challenge!
Trust Signals
The number one reason that people buy is that they like or trust their sales person. Preferably both.
Trust can be built in a variety of ways:
- A proven track record of success.
- Third party endorsements; people who vouch for you.
- Keeping your promises: delivering a quality product, on time, with great customer service.
The longer you are in business, the more opportunities you will have to build trust.
If you’re just getting started, you may need to give out product samples, offer trial periods, do pro bono work, or recruit beta testers to try your product to start building your foundation of trust.
From a marketing perspective, trust is made up of:
- Your customers’ perception of your brand (your logo, design, and copy).
- Evidence of tenure: trust signals like an established website, Google business profile, social media profiles, association memberships, and so on.
- Evidence of success: reviews and testimonials, positive comments, and engagements on your social media, case studies and portfolio pieces.
The deeper your bedrock of trust goes, the easier it will be for you to sell your product.
We help clients set up these signals through services like website design, search & AI optimization, social media, and reputation management, showing credibility from day one.
Homework: Trust Signal Audit: How many trust signals do you have? List them now.
Profitability
You can have a great product and stellar reputation and still go out of business. How? Lack of profitability.
The basic formula for figuring out whether your business is sustainable is this: Gross revenue – Expenses = Profit.
There is a great book called “Profit First” that goes into detail on building a profitable business. In the book, the author suggests flipping the traditional formula: Figure out what percentage of profit you want to make first, then figure out gross revenue and set expenses.
As you run your business, you will constantly need to ask the following questions:
- How can I make my product better?
- How can I make my product faster?
- How can I reduce expenses to improve my profit margin?
- What’s the maximum good that I can do for the maximum number of customers?
What’s your profit margin? A good early target is to aim for 10-20% margins. Some extremely efficient, in-demand businesses can do 30-40%!
Cash Flow
“Always make it easy for people to give you money.” – Terry Pratchett, “Going Postal”
You’ve got a great product, and good margins. Now it’s time to make sure you get paid!
It’s very important to have systems in place to make sure that you’re invoicing early and often, sending out reminders, and giving customers multiple ways to pay you easily.
At Aqua Vita, we use QuickBooks for invoicing. We have reminders set to go out 10 days from the due date, and we have a digital payment form set up on our website to make payment easy for our customers.
Payment Options
We also have other payment methods set up: ACH for direct bank transfers, automated monthly credit card billing for retainers, and of course, checks.
Fortunately, we have lots of experience in setting up billing systems. We tailor-made our own (and have done the same for many clients), and it was a game changer!
Everyone is a little different in when and how they like to pay. Give them lots of options, invoice early and often, and your cash flow – the life-blood of your business – will beat more regularly.
Cash Flow Planning
And make sure you know your burn rate (monthly expenses divided by cash reserves) to know your runway. If expenses are $5k/month with $15k saved, you’ve got a 3 month runway.
And finally, if you don’t have a budget set up for your business: do it now!
In September of every year, we build our budget for the following year (through December 31st). Planning that far ahead helps us to set goals, plan expenses, and profit share in a more responsible way.
Positive cash flow isn’t luck; it can be designed and improved through the systems that you build.
Homework: What’s your burn rate? How can you shorten collection times? Do you need to refine your budget process?
The Checklist
So let’s review:
- Your product delivers value the market truly needs / wants.
- Your brand sparks empathy and trust.
- Your product pricing is competitive, with a strong profit margin.
- You’ve got regular, predictable, positive cash flow.
If you can check all of these boxes, you’ve got a winning business!
Your Marketing Mix in Stage 1
In Stage 1, your marketing mix isn’t about big budgets. It’s about telling a compelling story with limited resources. At Aqua Vita, we started by leveraging the name given to us by the first non-profit we worked with.
Branding and Storytelling
Your name, and the artwork surrounding it, should tell your story and give some indication to prospects and customers what the culture of your company is like.
When developing a brand, we use tools like the StoryBrand Framework and our AV Brand Brief to make sure we’re building a strong foundation for your business.
Evidence of Tenure
If you’re bootstrapping with a small budget, you can start with a one-page website. Give your best pitch at the top, share your product or service information, and give customers a way to contact you or make a purchase.
If budget is less of an issue, start with a 5-7 page website. Each landing page gives you one more link and one more chance to appear in searches or AI results. Common starting pages are your homepage, an about page, 1-3 service landing pages, and a contact page.
For local search, you’ll want to make sure you create and optimize a Google Business Profile as well. Your GBP is your best chance to show up in organic search results at the top of the page. This is also where you’ll send most of your customers to leave you reviews.
Lastly, you’ll want to make sure you set up at least one social media platform, complete with your branded graphics and a few starter posts.
Evidence of Success
You’ll want to start gathering reviews from customers as quickly as you can. Reviews are not only important to your rankings, they can also be reposted on your website and social media platforms.
If you do the type of work where a portfolio or case studies are possible, these also go a long way in empowering your sales efforts. There’s nothing quite like hard numbers and happy customers to build trust with a new prospect.
And lastly, posting achievements or educational content can help to establish you as an expert guide, further securing your reputation as the go-to provider for your product or service.
Promotion Basics
When you’re just getting started, local networking can be one of the fastest and highest ROI promotional efforts you can engage in. As you build your contact and customer lists, sending a regular email newsletter is a fantastic, low-cost, high-return way to nurture your contacts and grow your business.
If there’s any budget left over, micro-ads ($50-$100 on Facebook targeting your demographic) can give you a fast, trackable way to generate inbound leads without having to hit the streets.
Measurement and Iteration
The earlier you can set up tracking systems, the better. It will allow you to see what’s working and what isn’t, and to tailor your budget and efforts based on that information. For your website, Google Analytics / Google Tag Manager is a great way to do that. A skilled agency can help you to set up tracking so that you can see how many calls, form submissions, and visitors your site is generating, and the same is true of ads you run on social media.
So here's the breakdown:
Mastered Stage 1?
Stay tuned for Stage 2: The Grow Stage!
Ready to build your marketing mix?
Give us a call at (918) 518-5907, or schedule your strategy session today!