I remember when I first thought about starting a business almost 20 years ago.
Back then the conventional wisdom was that you needed a pretty thorough business plan.
Don’t do anything without a business plan! the people would yell from the rooftops.
If you really want to make sure you have all of your bases covered then you need a business plan.
I tried to create one. It didn’t work out very well because it required actual planning. I’m more of an active thinker where I like to walk through things to see how they play out.
You probably don’t want to do that with a brick and mortar business and it makes sense that those have business plans. It’s pretty hard to pivot your cupcake shop once you have the physical space and equipment all lined up.
However, thankfully, the online world is different.
In the online space you get to be flexible. The worst thing that has ever happened to me was that I had to change domain names because apparently nobody was going to buy my custom notebooks from a site called Joe’s Shrimp and Cornbread.
So if I’m telling you that you can get by without a business plan if you’re creating an online business then why are you here?
Well, I’m going to show you the type of business plan that you should knock out if you want to start an online business.
The Type of Businesses We Build
First, let me tell you the type of business that we excel at. The type we teach to over 2,200 students and counting.
I like to call it the Experience Business and it’s basically when you take your experience with something, bundle it up, and then sell it to your audience.
It’s okay if you don’t think you have any experience to sell. You do, but you don’t need to completely figure that out right at this moment and you definitely don’t need to build up the confidence yet.
Let’s see if we can get that confidence built up as we move along.
The Business Formula
First, it’s important to understand that a business requires just two things to succeed.
- An audience
- An offer
In essence, business is nothing more than:
Audience x Offer = Money
That’s it. That’s business.
In a nutshell you have your condensed business plan right there. You’re going to find an audience and you’re going to provide them with the right offer.
Every single business follows this formula. There are no exceptions.
So now what you need to do is to figure out who your audience is and what your offer is going to be.
But some of you might be out there screaming about your niche and you bring up an excellent point. Let’s talk about that.
Choosing Your Niche
I could tell you to follow your passion or interests. I could tell you to look for an opportunity that others seem to be missing. None of this advice is wrong, but I also don’t want you to get too caught up in a topic.
For example, if you want to help people with their health then that’s what you should do. Should you niche down?
Of course, and we’ll get to that in a second.
First, I want to ask you what do you think a niche is? I think it’s easy to call it a topic, but what about the big magazines that cover lots of topics?
I guess you can give them their own niche like Women’s Lifestyle, but that doesn’t help people much does it?
There are businesses that do really well targeting very specific niches (dog training for German Shepherds) and then there are some that do well targeting ver large niches (Cosmopolitan, Men’s Health).
So what is the best route for you?
Start small. Not because I want to make your life difficult, but because I want you to start strong.
We live in a world where there are 1000s of brands each day vying for our attention. It’s annoying. It’s boring.
We ignore most of the messages simply because they don’t pertain to us. It feels like they don’t speak to us at all.
And that’s because the brands are trying to target a large group of people.
That’s why you go small.
Think about what happens if you go small? You develop a more targeted message where you get to talk to a specific person. Because of the 1000s of messages this person receives every single day, yours stands out because it speaks to them.
That means something to them.
And when you can get their attention that means they aren’t paying attention to someone else.
So if you really think about it, your niche isn’t a topic, it’s a person.
Your niche is your audience.
I know it’s more fun to put a label on things. You run a cooking business, that’s great. But what kind of people are really coming to your site and connecting to your content?
I bet you they have the same worldview.
In essence, they are the same audience. They are one person.
You see where I’m getting at?
So that’s your Niche.
Remember our formula for business?
Audience x Offer = Money
The Audience is the Niche in that equation. The more focused the niche, the better chance you have of succeeding early on.
As time goes on and you begin to nail down one audience you can find another if you want. However, there are people that want to try and cast a wide net because they just have so many interests and then they end up talking to no one.
That is the value of starting small and narrow. It isn’t meant to restrict you.
It’s simply meant to give you a better chance right out of the gate.
If you want to learn more about choosing a niche then be sure to check out this great post on choosing a niche.
Which leads us to your offer.
Finding Your Offer
So what is your offer?
It can be many different things.
- Coaching services
- Consulting services
- Physical products
The list goes on. The actual format of the offer isn’t important right now. What’s important is what it does.
And what’s that?
To answer that question we need to look at what people buy or more specifically WHY people buy.
Why People Buy
Everything that you’ve ever purchased in your life you’ve done so for one reason.
That’s right. People only buy improvement.
I know you can doubt me all you want, but it’s true. People only buy improvement and this is a good thing.
Because it means you have a standard you should be working towards with your offer. If your offer doesn’t help improve someone’s life and you can’t communicate that improvement effectively, then you’re not going to make much money.
However, if you can show someone that your offer is going to improve their lives, then you have a great shot at this business thing.
But we need to take it a step further. We need to understand the story of the person.
We all have a story playing our heads. This story represents how we think of ourselves.
For me, I always had a story that I was going to be a great success, but the main story that I kept on telling myself was that eventually things were going to work out and I just had to wait. But for now I was going to play video games or go out and party.
Why does this matter to you?
Because if you can discover the story your audience has in their heads and then enter that story, you can show them that you can lead them to a happy ending.
If someone has a story that they want to be in a happy relationship with their spouse, but everyday they are fighting, then how awesome would it be to show up with a message that says:
Tired of fighting everyday? Improve your relationship in just 5 minutes a day with this exercise.
That would be enticing, right?
It pulls the person in and makes them believe that you can improve their lives.
Marketing is the generous act of helping someone solve a problem. Their problem. Marketing helps others become who they seek to becomeSeth Godin
That’s a beautiful definition isn’t it?
That’s what business is all about. If you can do that then money will follow.
So your offer has to provide some type of improvement to someone’s life. If it doesn’t or you can’t do a great job of communicating how it does then the business formula just doesn’t work out for you.
And that’s why I said earlier you don’t have to worry about your experience at the beginning. As long as you figure out your Audience and the specific improvement they want, then you can work on providing that.
Some of you reading this will already have the experience to help them while others will have to gain the experience.
Remember, the more specific the problem, the more specific the solution, and the faster it will be to acquire the experience.
Showing someone how to design a beautiful backyard garden requires a lot more experience than showing them how to grow a tomato in a jar.
Over time, as you continue to grow so does your experience and therefore your offers can become more valuable as they solve bigger problems.
That’s your business model.
It doesn’t have to be difficult.
But now we have another problem with this business plan.
How do we get the people?
Gathering Your Tribe
This is the big dilemma that all businesses face, both offline and online.
How do you get people to come to your business? With everything that we’ve talked about before we understand that you need to get the right people to your business, not just any people.
The right people are the ones who will spend money and your business requires money.
So how do you get them?
Well, to keep things simple you can follow the Pocket Business Framework. What’s that?
- Get the Hero to notice you
- Get the Hero to pay attention to you
- Get the Hero to trust you
- Convert that trust into money
If you follow this framework you’ll make a lot of money.
Each of the steps in the framework can be filled with different tactics which means you don’t need to do what everybody else does.
Let’s use two businesses examples to show you what I mean.
- Notice: Decides to use YouTube videos to get people to notice them
- Attention: Creates awesome videos to help keep people’s attention and then sends them to a landing page where they can sign up for their mailing list
- Trust: Continues to provide videos that helps with transformations along with sending emails consistently to develop trust
- Money: Offers a course
- Notice: Decides to use Pinterest to bring people to their blog
- Attention: Writes in-depth blog articles
- Trust: Sends weekly newsletters with awesome insights
- Money: Sell coaching services
Do you see how both businesses follow the Pocket Business Framework and yet use different tactics to achieve success? If you want to feel as though your business plan has to have more substance to it, then just plug-in the Pocket Business Framework and figure out how you’re going to fulfill each step.
Creating a Business Plan
Hopefully, I’ve shown you that creating a business plan for your online business doesn’t have to be complicated or 50 pages.
It just has to show how you’re going to gather your audience and what offer you’re going to provide.
None of this has to be written in stone, but you should have an idea of the things you want to try before you get started.
Don’t fall into the trap of thinking that it’s better to figure out your offers later because then you might be gathering the wrong audience to start.
If you decide to change directions then that is fine, but at the very least you’ll be moving in some type of direction and that’s a lot better than most people.
It doesn’t take much to build a Pocket Business that makes you a lot of money. It just takes the ability to stick to the formula and apply the framework.
If you’d like to see how we put our business plans together and actually build out different businesses then be sure to check out the Pocket Business Lab.