10 useful business concepts for designers
Building your business sense to become a complete product designer.
Hello friends! It’s Budi. In this article, I’d love to share some interesting business concepts. Building your business sense will help you become a complete product designer.
1 - Start small
Peter Thiel pointed out that you want an idea that becomes a monopoly. But you can't start a monopoly right away. You have to start small. Find a small market where you can get a monopoly and quickly expand. If you work in a startup, ask yourself: who are you targeting now?
2 - Three money questions
Mark Cuban often says that there are three basic questions when starting a business: What are your costs? How much can you sell it for? Can you make a profit? This may seem simplified, but ultimately, the business should care about that. Think about how you can save costs or increase profit. Cost, price, and profit.
3 - Selling is helping, not convincing
This is probably my favorite concept I've learned from Mark Cuban. Have you ever dealt with a salesperson who tries to sell you something? They never listen to what you need. So, if you are building a landing page or a marketing campaign, think about how to help the people you seek to serve.
4 - Five parts of every business
Every business must 1) create and deliver some value, 2) that other people want or need, 3) at a price they're willing to pay, 4) in a way that satisfies customers'’ needs and expectations, 5) so that the business can stay to operate and continue its mission.
5 - Attention is limited
We are good at filtering. We filter out what's not useful to us. To be noticed, you need to find a way to be more interesting or useful than your competition. When you build a product, think about why people should care. When you send that push notification, what's in it for them?
6 - Level of awareness
Sometimes, your prospect is not aware of the problem. So when you offer them a solution, they don't get it. There are four levels of awareness. 1) unaware, 2) problem awareness, 3) solution awareness, 4) full awareness. Full awareness is when the prospect is convinced that your offer is a good solution to their need.
7 - Expectation effect
Customers have their own perception of your product quality. After they purchase your product, the performance of the offering must surpass their expectations for the customer to be satisfied. Quality = performance—expectations.
8 - Hard to copy
One of Netflix's product strategies is to make its products hard to copy. The algorithm, the in-house film you can only watch on Netflix, and its branding are all hard to copy.
9 - Allowable Acquisition Cost (AAC)
If you spend more money on marketing than your sales, that's not good. Mark Cuban often says, "Don't buy your sales." So, the concept of AAC is useful because your business can calculate the lowest amount to spend on advertising to increase sales.
10 - Good-fit customers
Some customers are bad. They make a lot of requests, and they don't necessarily appreciate your business. You need to find good-fit customers, the ones who love your product. They usually understand your mission and are willing to pay for your product because it solves their pain point.
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