The way people talk, you’d think there are like four customers in the world. Maaaaybe five if you look around really hard — but that’s about it.
So whatever you do, if you’re lucky enough to have one of those customers, you’d better not do anything that minimizes the income you receive from them.
You’d certainly better not share them. You’d better cut your expenses to the bone on the back end, and hey . . . if you know that a competitor is courting one of the other three or four customers? Well, then you’d better get over there and work on stealing them away.
Right now, you’re rolling your eyes at this dumb picture I’m painting. But just for fun — just to see if I’m totally off base — ask yourself the following:
- Are you willing to partner with someone if it means that you’ll make less profit per customer, but have access to more customers?
- Are you willing to pay handsomely for referrals — 50% or more in some cases?
- Would you be willing to share your business with a competitor who does the same basic thing as you do?
If the answer to any of the above is no, then you’re suffering from a scarcity mindset.
You don’t really believe there are a lot of fish in the sea. You believe there are only a few fish. Or, maybe there are more fish way out deep, but in order to get to them, you’ll need to charter a boat, which means trusting some skeevy boat captain. And what happens when you get into a boat with someone who you can’t trust? You get whacked while baiting your hook, like Fredo in The Godfather.
I’m going to suggest getting over that perception.
There are a LOT of fish in the sea. And the sooner you learn to work with other people to help you get them, the faster you’re going to get ahead.
Anatomy of a successful partnership
One of the things I do in my business is set up WordPress blogs for clients. Just a few months ago, I met Genuine Chris Johnson of Flat Rate Web Jobs. Now, Chris does something interesting in his business. He sets up WordPress blogs for clients.
So what did Chris and I do with this apparent conflict of interests? We teamed up, of course.
See, if you do business in the way I tell readers and consulting clients alike, you’ll soon realize that there are “your people” and there are “not your people.” And once you figure that out, you’ll see that most of your seeming competitors really aren’t competitors after all. Even if your services are the same, your people probably are not.
Yes, Chris and I both set up blogs, but our audiences are very different. Chris’s customers come mainly from the offline world and are learning the power of blogging for the first time. My customers usually already understand the internet and the blogosphere.
The way he finds and contacts clients (often including a phone call) is very different than the way I do (social networking and blogging, never using the phone). The questions and pain points that he addresses for clients (“What’s a blog, and how will it help my business?”) are different than the ones I address (“How quickly can I get my blog off of Blogger?”). His packages include a ton of training material. My customers don’t usually need much training, at least in the basics. Accordingly, our prices are fairly disparate.
Lastly, our personal strengths are different, and complementary. Chris is very good at sales and would rather that someone else handle customer service and implementation. Conversely, I don’t want to sell. I’d rather implement and do customer service.
We could pretty easily have decided that we were competitors. Chris could have kept selling his packages, and been bogged down each time with building sites, answering emails, and so on. I could have stuck solely with “my people,” and worked to sell each job I did.
But instead, the partnership has allowed each of us to make thousands of extra dollars a month.
Now, that’s a dramatic example (side note: it gets more dramatic when you realize that Chris dated my wife before I met her, a fact that caught both of us by surprise), but there are a few ways that you can increase your business through strategic partnerships that don’t necessitate seeking out apparent competitors.
Here are a few ways to start small:
1. Get a team
Or at least get an assistant. You can only do so much as one person, and insisting on holding all of the reins yourself ensures that not only will your business not grow past a certain point, but also that you’ll be stressed out and unable to take time off.
2. Start paying for referrals
A lot of people are reluctant to pay for referrals (or to start an affiliate program) because it means shrinking your profit margin.
That’s short-sighted thinking. If you offer commissions to people who send you business, those people send you more down the road.
Remember, a referral is business you would otherwise not have gotten. So be cool and kick a thank-you to the person who sent it your way. For services and tangible products, 10-20% is a good commission rate. For digital products, it should be 50% — or even more.
3. Bundle your products with other people’s products
If you sell your Widget Buster Extraordinaire for $50 and another person sells Widget Smashing Secrets for $50, consider making a deal to sell both products together for $80 and split the profits.
Yes, you’ll make $10 less each time you sell a Widget Buster. But the new Buster + Secrets offer is so much more attractive to customers that you’re almost certain to sell enough more to make up for it.
Don’t be short-sighted. Assuming your margins still support it, 50 sales at $40 is better than 25 sales at $50.
Getting beyond doing it yourself
There’s a certain romance in “going it alone,” especially for bloggers. But taking the DIY (do-it-yourself) mindset too literally just ensures that your business will never be able to grow beyond the capabilities of one person.
Trust me, other people are cool. Partnering with them is fun. And doing so is absolutely the way to accelerate your progress. So have a little faith and try it already.
About the Author: Johnny B. Truant is a website builder and consultant extraordinaire who wants everyone to know that he’s raising his rates on January 1st — so if you’d like to work with him, now’s the time. (Contact him now and he’ll even build you a free blog.) You can also follow him on Twitter, where he’s moderately amusing.