Dan Lok

How To Expand Your Business Into New Markets

May 19, 2020 by Dan Lok Leave a Comment

Do you want to know how to expand your business into new markets? The current global economic crisis has been forcing many business owners to think creatively.

If you’re losing money because your current market is on lockdown, then you probably want to find ways to expand your business.

For many small, local businesses, it’s especially important to get into online markets and shift to online operations. If your business has been relying on physical stores, you need to learn how to go from brick and mortar to click-and-order. In other words, you need to educate yourself on the best practices for running an online business.

As a business owner, you are constantly challenged to expand, branch out, and test new ideas. But now more than ever, you need ideas that work and get you cash flow fast.

Expanding your business into new markets is probably one of the best ways to stay afloat in times of crisis. So, below are our best tips for how to expand your business:

How To Expand Your Business Step-by-Step

If the economy was good, you could simply go out and test your ideas. But that’s not possible right now.

Now is the time to be a bit more careful with your business decisions and plan before you act. For those who know how to seize it, there is an opportunity in a crisis.

Before you act, map out your plan strategically and diligently.

Step 1: What Are Your Possibilities?

First, you want to look at your possibilities. Do you want to break into a new market with a product or service you already have? Or do you have a new product and want to get it known in other markets?

Do you want to stay in the same market sector, but address a new customer sector, for example going from business to customer (B2C) to business to business (B2B)?

Expanding your business into new markets can also mean changing the way you deliver your product or service, for example, an online download instead of an in-person cashier.

Step 2: Market Research

Do market research. This is important, so you don’t want to skip this step.

Even if you can make educated guesses about your market, still take the time to look into this. Research what your market cares about. What problems do they have? How can you help solve those problems?

When you ask how to expand your business into new markets, you are actually asking how can you expand into new markets successfully.

You could easily go out there, start an online campaign to market to a new audience, and see if somebody buys. But that’s a very risky approach. Why? Because you have no idea if your strategy will resonate with your new market.

That’s why research is so important. Imagine if your research uncovers that your desired new market responds well to do it yourself services. But you wanted to offer a done for you service.

If you do research in advance you can adjust accordingly. If you don’t do any research, you’ll still come to the same conclusion but lose money and time on the way.

Step 3: Make a Decision

Now you know your options and you know your market. So, it’s time to make a decision. Do you want to enter this market or would you rather look into a different one?

It can happen that you made assumptions about a good market to expand into but after your research, you realize it’s not what you envisioned.

If you decide that it’s not your desired market, go back to step one. If you decide to proceed, go to step 4.

Step 4: Strategize to Expand Your Business Into Another Market

Now it’s time to plan out your strategy. How will you introduce your product? How will people find you? How do you position yourself?

Do you have to adjust to a certain culture? Do you have to change or tweak your messaging?

The clearer your plan is the better. Don’t leave anything to chance, but also be flexible enough to pivot if needed.

Enter a New Market with Existing Products

Now that you are clear on your step-by-step plan, let’s take a deeper look at your possibilities when it comes to how to expand your business.

The first possibility you have is taking a product or service you already have, and marketing it in a new way. This could be as simple as changing from a local business to an online business model.

Let’s assume you are selling shoes. You were selling shoes at your local brick and mortar store. But because of the lockdown, you want to open an online shop.

The product (the shoes) doesn’t change. You are still selling the same shoes. All you change is the way you market the product, and the way you deliver it.

Still, there are some pointers to keep in mind. If we stick with our shoe sales example, you’ll realize that buying shoes online isn’t the same as buying them in a local store. Your clients can’t try them on. People might order your shoes, but send them back because they don’t fit.

This is only one example, but you can generally expect new challenges with any new market you break into. If it were easy to expand into a new market then you’d already have done it.

Tweak Your Product

In some cases, you can still use a product or service you already have, but you need to tweak it.

Picture yourself selling marketing coaching sessions for entrepreneurs. Usually, you offer face-to-face meetings for your coaching, in person.

Now, if you want to get into the online market, you’ll likely shift to video coaching sessions. But, you could also record your training sessions and make it a complete online video training.

Pre-recording coaching sessions is great, because it requires no extra time from you once the product is in place. It’s a perfect way to scale your business without burning yourself out with too much work. Essentially, you can sell your recordings an infinite number of times.

Making some changes to an existing product or service is also easier than creating a completely new one. So, this strategy is one of the fastest ways when it comes to how to expand your business.

Expand With a Completely New Product

Some markets might be lucrative to break into, but they are completely different from what you’ve done so far. In such a case, you might have to create a completely new product.

A perfect example of this is when you go from B2B to B2C or vice-versa. Both markets have different needs, different pain points and different ways to do business.

What could that look like? For example, maybe you run a beverage company. In the B2C sector, you sell drinks to consumers. In the B2B sector, it could be about selling drink vending machines to corporations or becoming a vendor for supermarkets.

Do you see how selling drinks to individuals or selling vending machines to a business are very different business models? It’s a completely new product with different messaging and a different price point.

But even if you stay in B2B or B2C, you can still break into a new market with a new product. If you sell shoes, maybe you want to go to handbags.

If you sell coaching sessions, maybe you want to write a book and address a whole new market that way.

Expand Your Social Media Network

Do you know why Dan Lok is active on every major social media platform and market in every possible way? Because every sales channel attracts slightly different people.

Most businesses stick to one or two social media platforms. Maybe they use Facebook and Instagram often, but never post on YouTube. However, if you limit your social media channels too much, there will be certain market sectors you’ll never address.

And that’s exactly why expanding your social media efforts is a great way how to expand your business.

Expand Your Delivery Options

Your forms of delivery and delivery options might have to change, too. Uber Eats or similar delivery services are a perfect example. Until recently, part of the market was completely opposed to ordering food. They would cook at home or go to a restaurant.

Now with the lockdowns, more people are giving food delivery a try, and finding that it’s not so bad after all. Many restaurants switched to delivery so they would survive the crisis.

So, expanding your delivery options opens up lots of new possibilities.

A New Consumer Market

Wondering how to expand your business into new markets? Another way to look at it is your consumer market.

Maybe you are marketing to a certain age group, gender, or location? Expand your market by going wider.

Your product or service is solving a certain problem for a certain group of people. So, you can find a similar audience with similar problems and expand that way.

Another possibility is to go deeper into your existing market. Have a look at your existing clients. Do they have a need for a new product from you?

Let’s assume you are selling a three month business coaching program. Maybe your clients are doing great after your coaching, and now they want to tackle bigger problems with your help. You could offer them a six month or a year-long program.

If you sell shoes, your clients might be interested in getting shoelaces, socks, or other accessories from you, too. Maybe people are doing more walking, now, and more people want to buy walking shoes. You might have to adjust your inventory accordingly.

Don’t think in the category of products, think in terms of needs and problems your clients might have, and you’ll see potential to expand.

Relationships and The Human Element

Now, how to expand your business into new markets is also a question of location. For example, if your market is in America, you could expand to Europe or Asia.

This might not be as easy because you have to pay a lot of attention to cultural differences. What works great in one part of the world might be frowned upon in another corner of the planet.

However, you also don’t want to go into analysis paralysis. If you’ve done your research, sometimes the best thing you can do is just start. Try, and see if your model works. You can always make adjustments later.

The customer is a marketing genius. If something doesn’t work, they’ll let you know by not buying. That’s why marketing heavily relies on testing. You won’t know what really works until you tried it.

The customer is always the marketing genius. If it doesn't work, they don't buy. Click To Tweet

If you want to expand your market across cultures, it’s especially important to form relationships. Talk to your customers. What problems are they facing? What do they wish they had? In other words, what demand is already there and can be solved by you?

The human element is important in any market. People buy people. Building a relationship with your audience will always give you a competitive advantage.

Acquire Another Business

Business acquisition is a very advanced way of how to expand your business. To make this work, you need knowledge and capital. But if you make it work, it’s one of the fastest ways to expand into a new market.

Acquiring a business or merging with one can virtually double your business size overnight. It holds immense possibilities.

But, you have to do intense research, negotiate, and really think it through. It’s not a decision you make lightheartedly. If you run a small business, other options might be better for you.

How To Analyse A Market

After evaluating your options you might wonder: how do I actually research my target market? There are many ways to conduct market research, so here are some pointers.

Customers

Have a look at your customers. Find out their needs, pain points, and struggles. How does your offer help them?

Most businesses would focus on the client’s demographics like age, gender, and location. It’s important but do you know what else to look at? Almost more important than demographics are your client’s psychographics.

What’s that? Psychographics are wishes, needs, and preferences your customers might have. What are they interested in? Whom do they already buy from? What keeps them awake at night?

Looking at psychographics allows you to really understand your customers.

Competitors

Looking at your competitors is such a great way to better understand your market. Why? Because success leaves clues.

What is already working for your competitors? What can you emulate? There is no shame in doing something similar if there’s already a demand for it.

However, you also want to look at the reviews your competitors receive. What’s missing? What do people wish for or what do they criticize? Maybe there is something you can do better than your competition. That’s your competitive advantage.

Usually, it’s easier to get into a market where there is already some competition. Breaking into a completely new market is harder.

Market Size And Possible Barriers

You also want to look at your target market from a high-level view. This includes questions like:

How big is the market? How specialized?
Is it a growing market or is it contracting?
How competitive is it?

The answers to these questions will have great effects on your strategy. If a market is very competitive then you probably have to be more specialized. If the market is very big, you might want to find a niche.

It’s also a good idea to look at possible barriers to entry beforehand. What could stop you or slow you down? Typical barriers to entry are high costs. Some barriers are natural, others are imposed by the government.

For example, the government might collect a special tax for beverages that contain alcohol. It’s impossible to know this beforehand. It’s a barrier imposed by the government.

Natural barriers can look completely different. Maybe your business requires a huge warehouse. You can’t build it anywhere you want as there are natural obstacles like rivers or forests.

Environmental Factors

Finally, it’s important to note that no market exists in a vacuum. The market’s environment has a great influence.

Environmental factors include government regulations, technical developments, and cultural factors. Analyze them early on so you can expand your business successfully.

Find out which environmental factors could be dangerous for your business and which you can leverage for your success.

Even a change in a different market sector could affect your target market. Keeping an eye on these aspects as not only important at the beginning but pretty much all the time.

Even if you’ve been in a market for 30 years, you want to keep adapting to technological changes for example. If you can’t keep up your business runs at the risk of becoming irrelevant.

Ready For Next-Level Business Advice?

How to expand your business into new markets is a question of knowledge and skill. What if you could learn a lot more about business and marketing from Dan Lok himself?

And what if we told you that right now, you can get his 14 best training packages and save 57%? If your business is struggling right now because of the crisis, learning from someone who has done it all before is invaluable.

Dan Lok has been in business for over 20 years, and this isn’t the first recession he’s seeing. The Ultimate Training Collection includes everything he used to build a global empire. Discover The Ultimate Training Collection here.

10 Most Profitable Long-Term Business Contracts

May 18, 2020 by Dan Lok

If you’re an entrepreneur involved in a partnership, corporation, sole proprietorship or LLC, then chances are you’ll encounter multiple business contracts on your journey towards financial success. It could be a contract to bring in short term contractors, or a business deal which allows your company to grow. Regardless of the need, it is essential for you to understand the different types of business contracts in your industry. However, before we unveil the most profitable contracts to sign, it’s important to understand the basis behind a business contract.

If you’re new to the world of business contracts, you’re probably wondering what a legitimate business contract would look like. A business contract can be defined as a legal agreement between you and another party in the form of written or verbal communication. They are commonly seen in situations where services are required in trade of monetary compensation or an offered good.

Business contracts are agreements where individuals are assigned a duty and paid based on the contract’s terms. For example, a business contract might state that a marketing agency will provide services to a company. The payment structure is negotiated and added to the contract. Whether it’s a retainer agreement or another form of payment, it’ll always be detailed in the contract.

A business owner might sign a short-term contract, which typically last for less than six months. Or, they’ll sign a long-term contract which typically last for six months and longer.

Short-term contracts are best designed for companies who are limited by budget and do not require ongoing services after the specific project is completed.

Long-term contracts, on the other hand, are best for companies who have long-term goals requiring ongoing services to ensure their success is maintained. If a company knows they require an ongoing service, a long-term contract will be created. Long-term contracts have been proven for years to be more beneficial as they provide stability and minimal room for errors.

This article will only focus on long-term contracts, but feel free to explore short-term contracts if they appeal to your business needs.

Long-Term Business Contracts: The Dos and Don’ts

The entire premise of a business contract lies in the partner or company you desire to work with. Think about it: what happens if you get trapped in a six month contract with bad terms or a bad partner? Before jumping into a contract, it’s important to start the conversation by getting to know the person you’re working with. So to help you choose the right long-term contract, we’ve created some dos and don’ts to help ensure your company is in safe keeping.

The don’ts of contract signing

Don’t ignore red flags when negotiating a contract with someone.

One of the biggest red flags in a client is their attempt to cut prices or negotiate a discounted rate during your first interaction. This is a strong indication that your client is not capable of producing results or is not willing to go the extra mile for your company. Think about it: If a company tries to negotiate a lower price, doesn’t that mean their product or service isn’t as valuable as they claim it is?

The second biggest red flag is the client’s skepticism before entering into an agreement or a contract. Your client should have full faith in your company and should not be hesitant to sign a contract. Think about what might happen if your relationship starts off on a bad note. Odds are you’re in for a roller coaster of a journey.

The dos of contract signing

There are many factors to help you determine if a client is ideal for business.

The first tip is to find a client who’s is already successful in their respected industry. It’s always wise to sign with someone with proven results and the track record to get the job done. Your company is in search of results and strategy, so don’t hesitate to ask if they’re credible at what they do.

Another tip is to have a client who respects and trusts who you are. Signing a long-term business contract is similar to engaging in a long-term relationship. Think about it like dating someone, would you ever ask a girl or guy out if the initial meeting phase was rocky? Probably not, and the same analogy applies to signing a contract with a client.

It’s always wiser to sign a contract with someone who has proven results and a great track record. Click To Tweet

Now, let’s review the most profitable business contracts for your company. Below are the top 10 most profitable long-term business contracts:

1. Business Contracts for Websites

Have you ever signed up for a website and were forced to comply with a company’s ‘terms and conditions’ agreement? Do you wonder why companies have one? Terms and conditions for websites are designed to protect the company or website owner against any allegations from their visitors. It is a set of regulations where users are required to comply in order to use a service or product. You might find Terms of Service often replaced by Terms of Use, Terms of Conditions, or disclaimers on various websites. But keep in mind the context of each is identical.

As a long-term strategy for your company, having a Terms of Service agreement on your website will prevent you from getting into legal liabilities and obligations. The agreement will present limitations such as copyright protection warnings and jurisdiction information to your clients or viewers. This means that your company will stay protected while demonstrating to your customers their rights of using your products.

So you might be thinking, who on earth reads the ‘Terms and Conditions’ of a contract? We get it, not a lot of people do. But if you ever encounter a situation where someone breaks your terms and agreements, you’ll be able to save a lump sum of money if someone steals your product. This is why it can be one of the more profitable long-term business contracts.

2. Business Contracts for Privacy

A common way of protecting your company’s information is by having contractors, employees or vendors sign a non-disclosure agreement to ensure information remains confidential. A non-disclosure agreement (also known as an NDA) can be defined as a legally binding contract that establishes a relationship regarding a confidential topic. Upon signing an NDA, the parties must agree that sensitive or personal information obtained will not be made available public or used as a means of progression.

The amount of information listed on an NDA is strictly up to the discretion of the business owner. You can include sensitive information about your company, confidentiality agreements based on new products or concepts, or lines stating which information is allowed to be spoken of. There are other cases where you can include plans and unreleased news on your NDA. Morally, just ensure that whatever you desire to protect is signed by every affiliate who seeks resignation or current employment.

We’ve classified a non-disclosure agreement as one of the most profitable business contracts as they’ll always be beneficial in the long run for your company. Protecting information such as new releases is important for your company, and factors such as leaked information might soil your entire plan if competitors gain access.

3. Business Contracts for Partners

Most companies today rely on business partners to help fund the business and keep it growing. If you plan on partnering with someone in the future then this section is perfect for you. Whenever getting into a partnership arrangement, it’s important for both parties to sign a partnership agreement contract. A partnership agreement is a business contract that lays out the terms and conditions as it pertains to the agreement between two or more partners.

This agreement can contain attributes such as ownership percentages, length of partnership and means of termination. It must be signed when you start a partnership and must be thoroughly in review by both parties before business is eminent. As the business owner, it is your duty to ensure all gaps in the contract are secure to a full extent. Start by asking yourself “what if” to see your options if the partnership goes south. Remember, the point of the agreement is to ensure any disagreements are in safe keeping. Most partnership contracts last for multiple years, which is why we’ve included it in the most profitable business contracts in today’s market.

4. Business Contracts for Employers

Company’s today are hiring candidates for all aspects of their company. Businesses need all sorts of employees in accounting, management, marketing, IT, etc. To put your company’s protection at best interest. Every employee should receive an employment contract to verify the employment relationship between you and the employee. This contract is an employment agreement.

An “employment agreement” is a document between an employer and employee stating the legal obligations and requirements the employee must follow. This can include policies, responsibilities or special obligations undertaken during the hiring phase.

Your employment agreement can also have multiple terms such as their salary, entitlement for dismissal, and benefits attached to the job. If an employee commits a fraudulent or mischievous activity that is not on their agreement, you can relate back to the contract and show the action deemed as not tolerated on company property. This will protect your company for years to come and will help your employees understand their rights and responsibilities.

5. Business Contracts for Office Space

Similar to having a car or renting an apartment, commercial compounds use a form of business contract identified as a lease. A commercial lease can be defined as a legally binding contract made between a landlord and a business tenant. The lease agreement provides the rights for a tenant to use the property for a business or commercial activity for a set period of time. In exchange, the landlord receives money in monthly or bi-weekly installments for the use of space.

Most companies use leases as a long-term strategy for saving money compared to buying or building out a large commercial building for their operations. It’s cheaper in the long run and is most beneficial to small-businesses who are newly starting up. When looking for a lease it’s important to ensure the contract is well suited for your company. Things to look out for are landlord permits, obligations, expenses, and tax increases. Chances are you’ll be in this property for a while, so ensure you’ve found the right space that is an adequate work space and affordable.

If you ever need a second look on the lease, feel free to seek professional help from a lawyer or financial expert who has a thorough background in the real estate industry. They will be able to spot any loopholes or gaps in the contract that might become present in the future. Just note there are fees for using their service.

6. Business Contracts with Banks

Most people today use banks to pay off their cars, mortgages or miscellaneous expenses. If you’re into real estate or are a full-time investor, you might be familiar with regularly asking the bank for money for rental properties. The most common contract to lend out money through a bank is a loan agreement. A loan agreement is a binding contracts between multiple party to finalize factors such as collateral’s, guarantees, interests rates and duration of payment.

A loan agreement has various characteristics that are essential for your business to understand. The agreement will have the total cost of loan, the payment schedule, the right to default, and the flexibility on use of the loan proceeds. Similar to the idea behind an office space, it’s important for your company to have a logical plan set in place to pay off the loan as installments arise.

Companies use loan agreements to increase their capital and expand their inventory. Conventionally people believe loans can only come from a bank, but loans can be found from a variety of sources. There are credit unions, public funds and private investors who are willing to loan you money if your idea or business model suits their liking’s. Just note taking a loan can be dangerous if not planned out correctly. Always sit down with a professional financial advisor or accountant to ensure your company has a plan to uphold the end of your deal.

We conventionally believe loans can only come from a bank, but in reality we can find money from many other sources. Click To Tweet

7. Business Contracts for Purchases

Have you ever wondered how grocery stores and warehouses are able to purchase large sums of items at a time? Company’s use a business contract called a purchase order to connect the manufacturer with the buyer who purchases in bulk. It’s an agreement which sets the quantity of items with a negotiable price for a certain date. It also specifies the payment terms so both parties understand when they’ll receive or give payments.

For example, let’s say company X sells 1000 chairs to company Y for $100.00 with a delivery schedule of 10 days. Between them is a purchase agreement, stating 1000 chairs to be in 10 days for the purchase price of $100.00. The purpose of this contract is to ensure both parties remain ethical and receive payments or deliveries on time. Think about it like a receipt for an item you buy at a store. Let’s say you never got a receipt, would you be able to return an item back to the store? Or in terms of a large shipment, how will the buyer know if the seller is a scam? It’ll keep you safe in the long run knowing you have a written report if dilemmas arise.

8. Business Contracts for Contractors

Have you ever had an independent contractor perform work in your home? Maybe it was a kitchen renovation, a bathroom tear down, or a garage door replacement. To ensure you and your contractor are safe from legal liabilities, it’s important for both parties to sign an independent contractor agreement. An Independent Contractor Agreement can be commonly refereed to as a service agreement or consulting agreement. It’s a document that states the business relationship between a contractor and a client. More specifically, the financial aspect and service details in full clarification.

With respect to a small or large scale business, you’ll typically encounter independent electricians or construction workers who perform repairs or maintenance on your office space. Ensure the agreement states the offered service, contract end date, expenses, unfinished work and ownership rights upon completion. These are to negotiable when both parties sign a contract.

9. Business Contracts for Equipment

If you’re a company or individual who rents or requires heavy equipment for operation, then this section is for you. Whenever you lend out a piece of equipment, what should you do? It’s important for both parties to sign a business contract called a property and equipment lease. This is a contract that lists the terms and conditions for lending a piece of equipment, which includes information such as monthly payments, terms, deposits and ongoing maintenance requests. Doing this helps ensure the lent out equipment comes back in the same condition as it was originally sent.

If the lender brings back equipment in a poor condition, you can rest assured knowing the other party signed a contract stating their rights of usage for the respected tool. And if the lender fails to make monthly payments, you can bring up the contract in court or to the lender. It’s beneficial in the long-run in case any mishaps or future incidents arise.

10. Business Contracts for Dismissed Employees

During the lifetime of employment, employees tend to become familiar with your company’s motives. More specifically, the ins and outs of their respected industry. So what happens if the employee resigns? What happens if they starts their own venture with the information gained from your company? That’s where a non compete agreement comes into play.

Let’s say you hired a head engineer to design a world-class software for your company. A few months after your product strikes millions, your head engineer decides to hand in their letter of resignation. You can have the engineer sign an non-compete agreement to confirm all information from your company is not public to anyone within a time span of X years.

A non-compete agreement is a contract between an employee and an employer. It states the employee agrees to not enter into competition with their former company during or after employment. Legal contracts prevent employees from entering into markets or professions which are in direct competition with the employer. Simply put, it prevents someone else from taking your ideas and creating something new.

A non-compete agreement lasts for roughly a year, but is not subject to a lifetime holding. Information such as effective start date, reason for enacting, compensation, and location are visible on the agreement. For example, there could be an automotive company who doesn’t want their employees sharing valuable information with other manufacturers. Your company will stay protected long-term, which is why we’ve included it in our most profitable long-term business contracts.

Growing Your Empire

A lot of information on business contracts was presented in this article. Read it over, take notes, and apply your knowledge to ensure your business stays protected at all costs.

However, what if there was a way to grow your company and bring in new revenue you never imagined was possible? And what if this method is so powerful that you’ll never have to chase clients for revenue again? The secret is the High-Ticket Influencer program.

We’ve developed a new 12-week intensive program completely designed to help you grow your empire from the ground up. It doesn’t matter if you have almost zero revenue coming in. Nor if you’re hauling in millions of dollars per year. This program has everything needed to take you to the next level.

The program will coach you on the ins and outs of branding, operations, sales, financing, support and so much more. How about we share with you a sneak peak of the first three weeks of class?

Week one will teach you the strategies to build your own personal media platform. This will start intriguing more customers, and could start flooding your business with revenue.

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And the third week will teach you the 7 most powerful YouTube secrets. There’s a powerful roadmap of why YouTube videos can make a business blow through the roof out of nowhere. And as a bonus, there are still 9 more weeks of mind-blowing content for you to discover in this program.

If you are ready to grow your empire and build your business, click the link here to sign up for our live masterclass. Slots are filling up fast, so reserve your seat while it lasts.

How To Find Your Target Audience Personas In 3 Steps

May 18, 2020 by Dan Lok Leave a Comment

Are you worried about your engagement rates? Or are the number of people that view your content not where you want it to be? If you want to know how to find your target audience and bump up those numbers, you need to understand your audience.

With so much content being pumped out every single day, getting clarity on how to find your target audience is more important than ever. The attention span of the average online user has decreased tremendously over the last couple of years. This means that people are much more likely to scroll past your content if it does not match their needs or interest. Unless your content directly relates to what these people are searching for, they are not going to be interested, and your engagement numbers are going to stay the way they are.

The biggest problem when it comes to knowing how to find your target audience, is the fact that the marketplace is always changing. The needs of your target audience today may not be the same needs a year later, which is why you always need to keep yourself updated. Knowing how to find your target audience is one thing – keeping them is another.

If you’re struggling to get clarity on your target audience, you’re in luck. Today we’re going in depth on how to find your target audience personas in just 3 steps.

Step #1: Analyze Your Website And Social Media Traffic

The first step to discovering your target audience personas, is to analyze your traffic. If you’ve been producing content for awhile, chances are you’ve already built up a sizable following. You have traffic that’s flowing through your website on a daily basis, or a number of visitors commenting and watching your videos. If you have these things going for you, that’s good news. You’ll be able to analyze this information and use it to your benefit.

When it comes to analyzing your website and social media traffic, you want to determine what exactly is drawing your audience to your website or social media account. This could be factors such as the content you are putting out, what time or day you upload, or how engaged you are with your audience. As you analyze this data in more depth, it’ll reveal a bigger picture as to what kind of content your target audience likes.

For example, let’s say you’ve uploaded a video every single day for the last 3 weeks to your Instagram account, and during that time your engagement has been doing well. When analyzing your social media traffic, you’ll want to look at what specific factor caused these people to watch or comment on your video. This specific factor could be the time at which you uploaded the video. Or the video was different in terms of content from all the other videos. You can also look at how engaged your audience was, such as the number of likes or comments that they left. All of this is information that will help you determine your target audience.

Don’t Look At What’s Consistent, Look At What Stands Out

One of the biggest mistakes most people make when analyzing their traffic is looking at what’s consistent. For example, let’s say you’ve posted 7 videos over 7 days. 6 of those videos got around 20,000 views, with one video only getting 5,000 views. Looking at this data, you might be inclined to focus only on the videos that got 20,000 views. But in reality, the best way to discover your target audience is to look at what stands out.

The reason you want to focus on inconsistencies within your data, is because it’ll help you understand what works and what doesn’t. If your data shows you that every single video you’ve posted has gotten 20,000 views, you can’t learn anything. You don’t know what you’re doing right, or what you’re doing wrong. Your data reflects the needs and behavior of your target audience. The better you can understand what factors contribute to that data, the better you can understand your audience’s needs.

If there are specific days that stand out, focus on those days. Analyze what factors could have contributed to that particular outcome – whether it’s good or bad. If the outcome is a positive one, you can keep that in mind and experiment with putting more of that type of content in the future. If the outcome is negative, look at what differences are responsible for that negative outcome. That particular day could have been a holiday, resulting in less people browsing the internet and explains why your view count went down.

If you want to know how to find your target audience, focus on the things that stand out. They’ll give you more insight into your audience’s needs than focusing on what’s consistent.

Consistency got you where you are today. Will it help you get to where you want to be? Click To Tweet

Step #2: Audit Your Business Strategy And Compare It To The Marketplace

The second step to discover your target audience personas, is to audit your business strategy. Every time you put out a piece of content, or upload a new blog you should be doing it with a specific reason in mind. There should be a specific outcome that is achieved, which is what your business strategy focuses on. And with the marketplace’s needs constantly evolving and changing, you need to ensure your business strategy reflects those changes.

This is the difference between knowing how to find your target audience and knowing how to keep them. You may be able to attract new visitors to your website or new followers on your Instagram, but unless you understand how their needs change over time you will not have them for long.

For example, at the time of this article being written – Tik Tok is the newest social media platform that has gained popularity. Since its launch in 2016, in just 3 years it has managed to accumulate over 800 million active users worldwide. Compare this to Instagram’s 1 billion monthly users, and it’s very evident how fast the needs of the marketplace can change.

Analyze What Your Audience Does And How They Behave

One of the reasons why Tik Tok gained so much popularity in such a short time, is because a large majority of its user base are young teenagers from Generation Z. This is why it’s important to understand your target audience persona and who you are catering to.

Understanding the marketplace means also understanding what kind of people are interested in your content. You need to factor in things such as their location, age, gender, ethnicity, and interests. All of these play a part in determining what your target audience’s needs consist of, and are factors you will want to account for when analyzing data. One way to discover these factors is to look at what they’re searching for.

If you’re using ads to direct traffic to your website, you can view a lot of information about your target audience through Google Analytics. Some examples of information you can use from Google Analytics are

Keywords that visitors search for to visit your website
Length of time visitors spend on your website
Method in which they got to your website (Organic search, links from other sources)

If you produce a lot of content around finance and one of the keywords your visitors searched for was “financial freedom”, right away you can tell this person is probably an adult or older. You can then proceed to look at what actions this person took while on your website, what blogs they may have looked at and what other keywords they searched for. When you put all of this data together, it’ll give you a better idea of what your target audience personas look like. And in many cases, you will have multiple target audience personas.

Creating A Target Audience Persona

Once you’ve gathered sufficient data, it’s time to get clear on your target audience persona.

When creating a target audience persona, you want to get very specific about who they are and what their needs are. Some traits to include when building your target audience persona are:

Age
Gender
Relationship Status
Occupation
Who they follow
What they might search for
How familiar they are with your brand
How they spend their free time

The more specific you can get with these traits, the better your target audience persona will be. If you feel the need to include additional information, such as a target audience persona that “may or may not be in a relationship”, chances are you can create another persona and include that information in. The reason being that the needs and desires of someone who’s in a relationship, will be much more different than someone who’s still single and ready to mingle.

Someone in a relationship might be thinking of getting married and starting a family. They may be concerned with the state of their finances and how they can support a family. This person will be more future-oriented in their thinking, and your target audience persona should reflect those factors.

On the other hand, someone who’s single has different priorities in mind. They aren’t concerned with starting a family – they may be looking to date around and to meet new people. This also implies that this target audience persona consists of a younger generation, who want to spend their youth experiencing all that life has to offer. This person lives more in the moment and is present-oriented with their thinking.

Confused People Do Not Buy

This is why you need to be very specific when it comes to building a target audience persona. Unless you are able to narrow down their traits as much as possible, you are going to create overlaps in the kind of message you’re putting out. That will cause confusion because your audience has no idea who you are trying to target. And confused people, do not buy.

Avoid confusing your audience and yourself by being strict with how you create a target audience persona. If there are any traits that one audience may have that another audience wouldn’t, create a different audience persona to account for that difference. In our own company, we have multiple target audience personas that are based on a variety of factors such as their age, how much income they make and how familiar they are with The Dan Lok Brand.

Once you’ve created and understand your target audience personas, you can begin segmenting them and plan out what kind of content to produce. If you’ve created your target audience persona correctly, you will already know the needs and desires of your target audience. Now, all you need to do is create content that caters specifically to that target audience. The more specific your content is, the more your target audience will feel like you are speaking directly to them.

What’s important to note is that like the marketplace, your target audience persona will change overtime as well. That is why it’s important to frequently compare how your target audience persona matches up with what audience is in the marketplace. As long as you have a clear and solid target audience persona, you’ll be able to effortlessly audit your business strategy to match that audience’s needs.

Step #3: Segmenting Your Audience For Your Email List

Step 3 on how to find your target audience persona, is to segment your email list. We have already covered how to find your target audience persona by analyzing data (In Step 2), thus this section will go into how you can segment your audience for your email list.

Segmenting your audience for your email list is very important. As you have multiple target audience personas, you will also have multiple email lists with different audiences. The last thing you want to do is accidentally send one email list an email that has nothing to do with them. For example, one of the quickest ways you can make your male audience unsubscribe from your email list, is to send them an email letting them know there’s a 50% discount on women’s underwear.

You want to segment your email list to keep your audience engaged. In fact, a study showed that a company managed to increase their open rates by 40%, simply by segmenting their audience. Other benefits also include increased click through rates, increased conversions, more satisfaction amongst their subscribers and decreased unsubscribe rates. Segmenting your audience won’t just help you keep things organized, it’ll help keep your audience happy and engaged as well.

When In Doubt, Ask Your Audience

If you’re wondering what kind of emails to send to your audience, you might believe your target audience persona will tell you everything you need to know. And in theory, that is true and makes a lot of sense. But in reality, the best way to know what your audience wants to receive is to simply ask them.

When your audience wants to opt into an email list, give them a way to choose for themselves. That could mean setting up a checklist of email lists they want to subscribe to, or simply sending them an email from time to time asking them what their preferences are. By letting your audience choose what they want to see, you won’t encounter the mistake of sending them something they don’t want to see.

Remember that you will never know your target audience better than they know themselves. Asking them what they want is a very effective way to keep your target audience personas updated to the needs of the marketplace. It also allows them to feel more engaged, because you’re taking their opinions and feedback into account. This is why the most successful brands and companies often send you surveys asking you to rate their services. They know it is important to hear the voice of their customers, and make sure their needs are met.

Instead of doing research and guesswork, simply go to the source and get the information you need from there. In many situations, you’ll discover that your audience will offer you a lot of insight as to what they’re looking for. They might even share with you their deepest darkest secrets and needs – things you never thought they would be interested in.

“The customer is always right.” – Common proverb

How To Find Your Target Audience Personas In 3 Steps

Knowing how to find your target audience persona can be simplified to just 3 steps:

1) Analyze traffic data

This is where you analyze the traffic data from your website and social media accounts. Look at factors such as keywords your audience is searching for, how much time they spend viewing content, and where they came from before landing on your page.

You’ll want to analyze any sort of data that stands out from everything else, as that will give you the most insight into how you should pivot your approach. Consistent data will show you what you’re doing correctly, but won’t tell you what you need to do to improve or get better. If you want to keep your audience following you for a long time, you need to make sure you’re taking steps to improve every single day.

2) Create target audience personas

From analyzing your traffic data, you’ll be able to gather a lot of useful information about your target audience and their needs. Using this data, you can create your target audience personas.

When it comes to creating and knowing how to find your target audience, you want to be very specific when it comes to what their behavior and traits are like. If there is any information that would overlap with another potential audience, you’ll want to create another audience persona to avoid confusion. If you’re putting out content and your marketing message isn’t clear, you will confuse your audience. This leads to higher unsubscribe rates, unfollows, and lower conversions.

Confused people don’t buy. Click To Tweet

3) Segment them based on their needs

Segment your audience so that you’re delivering to your audience exactly what they’re looking for. To do this, ask them what kind of content they’re interested in or what their individual preferences are. One of the biggest mistakes people make is trying to guess what their audience wants. In reality, it’s much more efficient to simply just ask them. You’ll develop a stronger customer-brand relationship, and be able to keep your target audience persona’s up to date with the needs of the marketplace.

Discover How Dan Lok Scaled His Business To 7 Figures In 8 Months

Congratulations! You’ve made it to the end of the post. Those are our tips on how to find your target audience personas in 3 steps. Now, what are the chances of you implementing this in your business?

For most coaches, consultants and experts, it is close to zero. Because it is just information.

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From Brick And Mortar To Click And Order: How Your Business Can Shift To Online Operations

May 12, 2020 by Dan Lok

Is your brick and mortar business struggling due to the current global crisis? You’re not alone, but the reason you’re struggling is not only because of pandemic-related business closures. If at all, COVID-19 only sped up what was already happening. The retail apocalypse was already well underway, before this global pandemic began.

Since 2018, 59% of the retail stores have closed down. Why is that? People’s buying behaviors have simply changed with the digital economy. Consumers are feeling more and more comfortable ordering things online. Before the boom of online retailers and e-commerce stores, consumers had to go to a brick and mortar shop and look at the product. They depended on the selection of shops in their city.

Today, however, information and the product don’t belong together as much. What does this mean? Consumers look for a product and then find a shop that provides it at the best price and value. That’s why brick and mortar shops have had to adapt and change their sales process.

But that’s not all. Suppliers have also changed their sales processes. Since it’s so easy now to set up an online store, many suppliers would rather sell their products on their own website than through a brick and mortar store. Suddenly, the manufacturers are cutting out the middle man.

In short, brick and mortar stores have fewer products to sell than before, and consumers don’t want to shop in a store as much anymore. Only shops that provide essentials, like supermarkets, still see frequent visits.

What can you do if your store falls into the ‘non-essential items’ category? Or, what if you cannot go online because your offer is only applicable in person? Examples of this include massage therapy or similar services you typically can’t buy online.

In this article, we’ll go over some tips on how to save your business during this crisis. What can you do to protect your business, income and livelihood?

Even if your business can only deliver services in person, make sure to read the whole article. Because in the end, you might get an understanding of what you can do to save your specific business, too.

The Biggest Changes Brick and Mortar Stores Need to Make if Shifting to Online Operations

If you want to shift your business from brick and mortar to click and order, there is more to it than building a website and having a shop-plugin. You see, many brick and mortar store owners make one common mistake. They see their website as only an online version of their real store. But online shopping doesn’t work like shopping offline. Consumers today don’t find stores online by accident or click through the pages for fun.

There are three steps to transform a struggling offline business into a thriving online business:

Help people find you online.
Adapt your product range to that of online shoppers’ behavior.
Encourage the consumer to return to your online store.

If you follow those simple steps in order, you’ll have a very high chance of weathering the storm and thriving despite a global crisis. You might even come out stronger than before. Before we go there, let us give you advice on how to get the most out of this article: Read it with an empty cup.

As Dan Lok often says, two of the most dangerous statements in business are, I know that and, My business is different. It might feel like you already know some of the strategies we’ll discuss. Or, you think your business is different and you and your clients have a special relationship. Your way of doing business is different, right?

Are you ready for the unpleasant truth?

If these differences were enough, you wouldn’t be struggling right now. You only know it if you live it. Study the tips in this article carefully, and allow yourself to accept insights that are radically different from what you intended to do.

From Brick and Mortar to E-Commerce Success: How to Get Consumers to Find Your Online Store

If you want people to find you online, you can do several things. One of the most essential things is experimental marketing. Why? Right now, there are countless online shops out there offering the same products as you. If you want to stand out, it’s crucial to become visible. You can use short-term and long-term strategies. Which one fits you best depends on your business.

If you want to use Facebook as an advertising platform, make sure to keep Facebook’s strict rules and regulations in mind. For products that are somewhat controversial, Facebook will often not allow you to advertise them. In this case, you can use either Google ads or create educational content.

As a next step, you can optimize this content for search engine visibility. Using this method to promote your business is called SEO marketing.

The Power of Niche Marketing Techniques

If you want to shift to online operations, you may need to become more of a niche business. The most effective marketing happens when you have a niche. Why? Because online shoppers already know what they’re looking for, specifically, do you understand? You see, if you are an offline brick and mortar store, people might like to walk through your shop. They can walk around the and discover different things they like.

Online, however, people look for a product with a purpose and an intention in mind. If you send them to your store with marketing, you also need them to have an intention. Imagine you were a customer yourself. Let’s say you saw an ad that says, Visit the ABC store now, we have all kinds of products.

Would you click it with a serious buying intention? Probably not. The ad isn’t specific enough, or niche enough. You were not looking for something specific, and the ad didn’t give you a clear picture of what is waiting for you.

But what if you were looking for a birthday gift? Imagine you see an ad that says: Trendy Gifts, the gift shop that has the greatest selection of birthday gifts available. How would you react now? This ad was targeting the niche of gift-giving, but the same is true for any kind of niche. In what niche could you specialize? Here are some examples of niche online stores that work:

Household products (brooms, cleaning supplies)
Athletic apparel
Electronics for gaming
Beauty products

Those are just a few of many niche examples.

Why Niches Magically Attract More Customers

Why is having a niche essential? Consumers today want what they are looking for immediately. They neither have the attention span nor the patience to browse for too long. Having a broad range of products isn’t as much of an advantage anymore as it had been a few years ago. But where is the difference between the ads before? Didn’t it say we have the greatest selection of gifts available?

Yes, think about why it works: If you are looking for a specific thing, what good is a vast range of random products? If you are looking for a gift, it’s a hassle to browse through clothes, electronics, household items. But if you have a great selection available for a specific demand, it might be enticing again.

There is another advantage to a niche: You can tap into an existing demand. What’s the benefit? Did you ever have a product in your store that no one ever bought, even if you reduced the price? The reason was probably not the cost, but the fact that no one was looking for it.

If you only offer products a niche that people are interested in, chances are you can sell much more.

There is even more to niches – you can specialize even deeper. Let’s say you want to dive into the beauty niche. You can choose to specialize in organic skincare only. That’s a niche within a niche. You won’t offer all beauty products such as hair products, makeup, and skincare. Only organic skincare. Want to be even more specialized, and even more niche? You could only sell only skincare for the face.

Be careful not to specialize too much. Before choosing a niche, do proper research and make sure that you have a market with a demand waiting for you. Important: Just having a niche doesn’t create demand. Specializing in an existing need and pulling in that traffic is what niche marketing is all about.

How to Adapt Your Product Range for Online Success

If you take a look at successful e-commerce entrepreneurs, you will notice a trend. Most of them say, Start with a general store, find one winner and scale that one. This advice sounds simple, but it isn’t easy. That “winner” is a product that sells like the proverbial hotcakes. To find it, you need an intense research process. Also, you have pitfalls to avoid. Before we go into useful advice on how to adapt your product range let’s talk about those pitfalls. This advice might seem counter-intuitive. Especially if you had a brick and mortar store before, this is crucial for a future e-commerce success.

What are some pitfalls or warning signs that you might not be setting yourself up for online success?

E-Commerce Pitfall #1: You are Overly Attached to your Product

Most e-commerce beginners choose a product based on what they like. But you are not your customer. For e-commerce to work, the only thing that counts is data. Analyze the market, see what works and then invest in that product. You might see a product that doesn’t even make sense to you but sells 100 units a day. Then you see a product that looks like people will immediately buy – but they don’t. Be brave enough to drop a product that doesn’t return results as fast as possible. Yes, it might be disappointing to be wrong with your intuition, but this comes with experience. Just move on, fail fast, fail forward and win sooner.

E-Commerce Pitfall #2: You Don’t Research Enough

It’s not enough to have a deep understanding of the market need. What good is it if you can’t deliver what people order? That’s why it’s just as important to gather intel on your suppliers. Especially in e-commerce, where you can source products directly from manufacturers. Sourcing directly most likely costs you a fraction of what you are paying now. That’s why many e-commerce stores have a higher profit margin than a brick and mortar shop.

Yet, high margins don’t matter if you can’t sell anything. Here are some things you need to look out for:

Is the supplier reliable? Check testimonials, ratings, and comments. Give them a small order to test their product quality, and write them messages to test how responsive they are.
Is the supplier big enough? What is their stock size, how fast do they restock? How long have they been in business, how long have they been on the platform you use to buy from them?
How fast does the supplier ship? Consider this in the shipment times you give your customers. If you have a product that is in high demand and you get many sales, it pays to use a different approach. You can partner with a warehouse in the country you are targeting. Ship several of the high-demand units to it upfront. This way, when you get an order, you can ship the product quickly and improve customer experience. What is a highly in-demand product? A good rule of thumb is if you get 30 orders per product per day.
What quality do the supplier’s products have, and how do they deal with faulty units? (What’s the return policy, warranty conditions, repair times?)

E-Commerce Pitfall #3: You Don’t Know Your Metrics

How did you imagine going from offline to online? Some brick and mortar business owners think it just means putting their stock on a website. Those businesses will have an unpleasant awakening soon. E-commerce is a noisy marketplace, and similar online stores will fight you for customers, quite brutally.

Without proper online marketing, it’s highly unlikely to get online customers at all. Since everyone is marketing, you need to outmaneuver the competition. As Sun Tzu said: A battle is won before it is fought.

Sun Tzu also said, If you know yourself and your enemies, you don’t need to fear a hundred battles. If you know only yourself but nor enemies, for every victory, there will be a defeat. If you know neither yourself nor your enemy, you will lose every battle. This wisdom is true in e-commerce as well. If you know what your competition is doing, what they spend in marketing and their strategy, you can win

Important Metrics that can Make or Break your Business

One of the most important metrics for this is the CAC or customer acquisition cost. This metric tells you how much it costs you to acquire a customer. To lead customers from the first click to the sale can be quite expensive. Why? Because unlike offline, the online buying journey has more steps. These steps include:

Seeing an ad

Clicking it

Visiting the site

Looking at the product

Putting it in the cart

Going to checkout

Buying

Even though you only pay for people seeing your ad and/or clicking it, without a sale, this investment is in vain. Their buying journey with you can end at any time, and then your ad was ineffective.

Let’s say you have a product that costs you $5 to source, including shipping, and you are selling it for $19.95. You now have a profit margin of $14.95.

This means you can spend theoretically spend $14.94 to acquire a customer and still make a profit, even if it’s small. Now take a look at the statistics of your campaign. Do your expenses shoot over your CAC? If yes, you are losing money, even if you sell a hundred products.

A Simple Way to Win the CAC War

This might be one of the most significant changes for brick and mortar store owners. Even selling thousands of products doesn’t mean you make any profit.

Make sure to have as high a maximum CAC as possible. Because if you can outspend your competition, you’ll win the war for customers.

For example, let’s say you have a maximum CAC of $100, and your competitor has a maximum CAC of $15

This means you can spend up to $85 more per customer in marketing. This way you will attract more traffic, and you can dominate your competition.

How do you get a higher CAC? Lower your cost for advertising. Now, we’re not saying to spend less on it. You see, some platforms reward you if you get a lot of engagement on your ads.

For example, on Facebook, if your ad gets shared, your cost to run it lowers. This is why the same ad can have a CAC of 15 or 100. Don’t try to do it yourself if you have no experience. It would be less expensive to hire an expert who knows what they are doing.

How to Adapt your Product Range the Right Way

Now that you know how to avoid some critical pitfalls let’s talk about how to find the right product. There are several strategies to do this. The first is to tap into an existing trend, the second is planning for the long run.

To use existing trends, watch social media ads closely. You might notice that certain product ads get thousands of likes in a few hours or days.

For example, if the ad runs for a few days and already has hundreds or thousands of likes, it went viral, which is good. To make sure, look for the product specifically and observe the reaction to other ads for it. If you see an overall high demand, it’s safer to invest in it.

There is never a guarantee that it will work, of course, but you can stack the deck in your favor. You can do this by being very cautious in testing. It might always be that a trend is only short-lived. Once you notice it, it might be declining already.

So don’t only look for one product at a time. The worst number in business is one.

How to Win Over the Online Consumer

Alright, you have chosen a niche, invested in marketing and are attracting clients. Now what? It’s very expensive to acquire new customers, but very cheap to upsell existing ones.

This means you want to figure out how to build strong relationships with your customers. What bonuses can you give them for staying loyal to you? How are you engaging them? If you make them feel validated and cherished, they will come back to you.

Think of your own buying behaviors online: Why are you coming back to individual sellers? Why do you never come back to others?

To engage customers to return, you can give them specific incentives such as:

A discount code for their next order

A discount or bonus if they refer a friend to your shop (perhaps their friend gets a discount as well)

Add an extra gift to their order for free, as a surprise

Ask them for their feedback on your store, and if you implement their feedback, let them know you followed their advice.

Include a personalized, handwritten thank you note in their order. This personal note will be appreciated when they open their package.

With strategies like the above, it’s easier to bring your brick and mortar store into the online world.

What’s the Most Important Thing Brick and Mortar Store Owners Need Right Now?

With the information in this article, you may or may not have an idea what you can do to save your business and lifestyle as an entrepreneur. But you likely have more questions:

Which suppliers can you trust? What trends will occur in a few months? Which online marketing strategy works best specifically for your business and your customers?

Of course, you can find this out, if you are willing to invest time and money in trial and error (which will teach you a lot, but take up a lot of your time and resources.)

Perhaps you neither have time nor money to waste right now. That’s why Dan Lok put together a high-level advisory board. Its purpose is to help distinguished entrepreneurs to create generational wealth even in times of crisis.

Distinguished entrepreneurs are dragons. Dragons are visionaries, wise strategists, fearless leaders, and daring enterprisers. The dragons will either dominate an industry or shape an industry—they are the Kings or Queens of their industry. Dragons can rise above a global crisis, because they have what it takes to survive the crisis.

Do you see yourself as a future King in the online space? Then you’ll want to draw experience from people who already failed for you. You’ll want to avoid pitfalls so you can be more successful faster. Imagine how you can grow if you learn from people 10,20 or 100 times more successful than you are.

If being a dragon sounds like you, click here.

Please note: This a very exclusive group. Only 100 entrepreneurs are accepted, so act now before your seat is taken.

Why Cash Flow Is More Important Than Revenue

May 9, 2020 by Dan Lok

Is your business struggling with cash flow in these uncertain times? This is the time when it’s especially important to understand why cash flow is more important than revenue.

As a business owner, it’s your responsibility to know about your business’ financials. If you don’t know it, who would? Even if you have financial advisors and experts on the team it’s best if you have an overview of what’s going on. Financials are the backbone of your business.

Understanding the differences between revenue and cash flow is even more vital in a crisis like now. Knowing the difference might save you from immense loss or even bankruptcy. If you completely outsourced all your financials so far, now is the time to learn about it and take it into your own hands.

Now is the time to make concrete and realistic plans. Positive thinking alone won’t get you out of a tight spot. Deal with the cold facts and develop a strategy accordingly.

Get yourself familiar with terms like cash flow, revenue, margin, and overhead and find out what your business has to focus on in these uncertain times. What’s important will depend on your business model – however for most businesses cash flow is the biggest issue right now.

Why is cash flow so important? How can you prepare your business to survive the crisis? And how can you allocate money fast? Those are some of the aspects we’ll discuss below.

What Exactly Is The Difference Between Cash Flow And Revenue?

The biggest difference is what the numbers tell us. Revenue tells us how much money your company made from sales. Whereas cash flow is much broader. It shows the total amount of money coming in and out. Cash flow also includes money coming in even if it’s not made from sales.

So while revenue shows the gross revenue coming in, cash flow shows the bigger picture. Revenue measures income, your cash flow measures your liquidity.

The thing is, revenue is usually calculated after you made a sale. It doesn’t take into account if you’ve already received the money. So maybe you made $10,000 on paper but you didn’t receive the money yet.

Cash flow is the actual money you have and it allows you to deal with short term financial demand. For example, you need cash flow to pay employees or vendors.

Revenue is more one dimensional. If you sell something for $100, then your revenue is $100. If you sell something for $1,000, then your revenue is $1,000. Simple as that.

Now cash flow also includes the money going out of your business. It shows you how much you have after all your regular expenses are paid. Cash flow allows you to make better predictions if you are breaking even, doing really good, or sliding into debt. So it’s way more important to keep an eye on your cash flow than on your revenue.

Why Cash Flow Is Even More Important In Times Of Recession

When the general economy struggles, cash flow becomes even more important. Do you know why are so many companies going out of business right now? – Because they lack cash. They might have all these accounts receivable but the money arrives on their account too late.

They need cash to pay their employees or even basic expenses like rent. If the cash doesn’t come in, they are gone.

Now, when the global economy struggles, here’s what happens. Almost all companies generate revenue. But it’s only on paper. The vendor of a supermarket might generate revenue from the last delivery.

The supermarket, however, couldn’t give them the cash yet. They made revenue from food delivery orders and are waiting for customers to pay. The customer ordered food with their credit card. They are an employee at a fashion company and didn’t get paid yet because their employer doesn’t have cash flow.

Do you see what’s happening here? It’s almost a vicious cycle. Only when the fashion company finally pays the employee the ball gets rolling. Then the employee can pay the supermarket and the supermarket can pay the vendor and the vendor finally has cash flow.

So, generating lots of revenue sounds great, but your business can’t survive until you are liquid. That’s why cash flow is more important than revenue.

How Can You Understand Your Cash Flow?

To run your business successfully or even weather the storm your business might be in right now, you need financial literacy. What exactly is that?

Financial literacy means you can understand your finances. If you look at financial statements then you know what’s going on in your business.

Many business owners make the mistake to completely outsource their financial affairs. They hire someone to do it. But really, if you don’t know how your company is doing financially how can you run it properly? How can you make wise investment decisions? That’s exactly why you need financial literacy.

When you look at your papers you need to understand which part is revenue and which cash flow. Only then will you know exactly how to react to it.

Now, every business is different and therefore has different cash flow behavior. Maybe your business has a stable stream of smaller sums. Or maybe you make huge sums but less frequently. It also depends on how large your expenses are.

Either way, nearly all cash flow behavior is disrupted in a crisis. You can expect to get paid slower but might be expected to pay faster. Your vendors will likely be less patient with you because they rely on your payment.

Your clients, on the other hand, might struggle and not pay you in time. It’s unfortunate but it can’t be helped. Instead of focusing on them, you need a game plan about what you’ll do if you need to pay faster than you get paid.

Know Your Data And Create A Plan

Now that you understand cash flow and have basic financial literacy, here is the next step. You want to get familiar with your data and make a plan.

It could be a 60 or 90-day plan, telling you the cash that will be required in the next period. After you have your plan, it’s time to get resourceful. An important thing to mind during this step: don’t manipulate your data to make yourself feel better.

Maybe you are facing the harsh truth that your numbers are in the red…or maybe you want to make some estimates which are too generous and not realistic, but would make you feel better…don’t do that. Be as honest with yourself as possible. Probably even better to be a tiny bit more pessimistic than you usual. Lying to yourself won’t get you out of tricky situations.

Most business owners will either underestimate or overestimate the cash flow they need. It’s hard to meet the exact number when you are making guesses and estimations. To be prepared for the worst, it’s better to overestimate than underestimate your cash flow needs.

Evaluate Your Resources

Now that you know your numbers, it’s time to look at your resources. Are you confident to make it through the next 60 or 90 days? Where can you get the money? Can you ask your bank? Is it readily borrowed?

Hope for the best but really prepare for the worst. Use the power of negative preparation and leave nothing to chance. Negative preparation means to ask yourself the questions: What do I not know? What am I not seeing? What’s the worst that could happen? These three questions will allow you to prepare for a worst-case scenario.

Again we want to stress, it’s important, to be honest with yourself about this. If you see no chance to increase the cash flow to your needs, what’s your backup plan? What do you do if something unexpected comes up?

Think about how you could possibly get more new (or repeated) customers in. That’s a good way to raise cash flow. Maybe you can tap into a new market? Maybe the crisis opened up a new opportunity for you?

How can you shorten the transaction length to get some cash flow earlier? Is it possible for clients to pay an amount upfront? Do you have private capital to invest in your business right now? Or could you find investors to support you? All of these are strategies to get you through when things are tight.

What To Include In Your Plan?

Besides cash flow, you also want to know your monthly gross margin. Now, what’s that? Your gross margin is basically telling you how much money you earn per sale minus the cost of getting your product sold.

For example, a digital agency might sell consulting for $2,500 but they also spend $300 on marketing. That means the gross margin for this product is $2,200.

If you had to adjust your strategy during coronavirus pandemic, then your margin might have changed too. For example, a restaurant that relies on a physical location has a certain margin. But now, they can only do delivery. The margin very likely has changed.

The next thing to think about is which expenses are absolutely necessary. What can be delayed and what can be cut completely? For example, you might still need your best employees to keep the business running. Their salary is a necessary expense you can’t delay. You’ll also need some form of marketing, to attract clients.

Delaying certain expenses gives you the opportunity to keep some cash flow for more urgent matters. What can you delay? Maybe there is a possibility to pay your rent a bit late? Are some higher-paid employees willing to take a temporary pay cut? Maybe even suspend their pay? Seek open communication with them about their current situation.

Should You Cut Your Marketing?

The marketing budget is usually the first thing you’d want to cut. It sounds like a good idea to keep your marketing budget so you have more cash flow right?

But remember, without marketing, you’ll have fewer clients which means flower cash flow. Marketing sometimes takes a while until the effects are noticeable. That’s why you think you can cut it for now. The potential risk is, however, that by the time the lockdowns are over you are left with no clients as you didn’t do any marketing.

Before you cut any expenses, do in-depth research and strategizing session. Even cutting the pay of employees can create long-lasting damage. It could destroy the team it took you years to build. Make decisions you feel comfortable with.

How To Increase Cash Flow

Now you know why cash flow is more important than revenue. But how can you generate more revenue during the downturn? Here are a few strategies.

Add A Strong Guarantee

First, you can increase your sales by giving better guarantees and warranties. This might sound counter-intuitive. Won’t your customers abuse your guarantee? If your product is good, then the opposite is true. Here’s why:

Most customers feel reluctant to buy because all the risk is on them. If there’s no guarantee the decision to buy is so much harder for them. If you offer a strong guarantee or warranty, you reverse the risk. All the risk is now on you.

But since your product is good and does what you promise it does, there’s nothing to worry about. Most people won’t use the guarantee if they are satisfied. So, for nearly all businesses a good guarantee (which has no loopholes) increases sales. But it doesn’t cost more to sell the same product with a guarantee. Hence, you have more cash flow.

Engage New Customers

Another great way to increase the cash flow is to actively look for new customers. What are some untapped markets you can branch out to? Maybe you’ve done a lot of local business and don’t have many online solutions? Now is the time to go online and build a customer base there.

Selling an online product is so great because you don’t have much overhead cost. For most, you don’t have to keep any stock – as the product is digital and not physical. The customer doesn’t have to wait for delivery but can get started right away. This is especially true for info products or online coachings.

Low overhead costs but increased sales result in more cash flow. Sometimes, what you sell only needs to be tweaked slightly so it can be sold online. It’s one of the best ways to increase cash flow during the lockdown.

Dare To Release Beta Products

Do you have any upcoming new products or services which aren’t fully finished? Instead of fleshing everything out to complete detail, it will pay off to release your product early.

Especially if what you created helps others to get through the downturn. For example, maybe you offer online coaching on how to take your business online. But the last two modules aren’t recorded yet. You’d want to release the program already and make sales as you finish it.

Most of your customers won’t mind or won’t even notice. By the time they get through the program, you’ll have everything set up for them.

Alternative Pricing Structures

If you need cash flow fast you might want to adjust your pricing structures. If customers aren’t able to pay the full price upfront, maybe they can pay half? Maybe even offer them a payment plan over the next three months – that way you get cash in every month.

Many businesses offer gift cards that allow them to generate cash now and take care of the fulfillment later. This is best marketed to customers who are already loyal and want to support your business during tough times.

You might be tempted to offer your product or service for cheaper for the sake of making cash flow faster. But often it’s not necessary. Just extending the payment period over a few more months helps. Fall back on payment plans before you start giving discounts.

Want More Money Habit Secrets?

You’d be surprised but most business owners don’t know much about the differences in revenue and cash flow. It’s easy to start a business but it’s a lot harder to maintain it – especially if an unexpected crisis hits.

You might have noticed that Dan Lok’s businesses have taken a very minor hit from this recession. He didn’t have to let go of any employees, he still has his marketing running and he released some new solutions in the last months.

How was he able to do that? The thing is, Dan Lok has seen five recessions during his time in business. So, he naturally adopted some money management habits that keep his business safe.

If you want to crisis-proof your cash flow and income, wouldn’t it be valuable to learn from his experience? Right now you can do so, with the Millionaire Money Habits Video Training. Right now you can get the training and save 50%. View all the details right here.

How Can Leaders Create A High Performance Team?

May 1, 2020 by Dan Lok

Whether you lead your team at work or your own business, you probably wonder – what makes a good leader? No matter what you do, the question is always the same – how can a leader create a high-performance team? As your business grows, you notice you cannot do everything yourself and you need to start having a team of people around you. Many entrepreneurs have a problem with being control freaks. They want to control everything and are afraid to let others make decisions independently. But you must know – delegating effectively can help you reach your goals faster.

If you don't know your team's goal - you're not doing your job as a leader. Click To Tweet

So, how to build a powerful team around you? This is a topic we could spend hours talking about. But let’s start here: leadership, management, and human psychology – the key to success in business is in the right mix of these ingredients.

It’s fine to do a lot more work when you just start a business. But, as it grows, if you don’t have a team – your business will remain the same and won’t be able to scale. And if your team doesn’t work well together, you will face incompetent workers and inevitable losses.

With that said, if you’re a business owner and trying to build a successful high-performance team, you must understand your people. First, have a conversation with them. Listen to why they want to be there – by your side. What are their goals? Aspirations? What drives them? Only when you know answers to these kinds of questions and get to know your team will you know how to manage them.

A good leader will take the time and effort to do this. Communication is very important in all aspects of life, especially for leaders and entrepreneurs.

Let Go of Control

Hiring people with the same mindset will benefit everyone because those are the people who work together to reach the same goal – they have the same, shared, mission. With that said, finding the right people for your team is not easy. Usually, people come and go. Most organizations hire people who work set hours and quit if they are dissatisfied or unhappy. Many people work set hours, but do not really give their best to use that time efficiently.

The worse thing is, some business owners only think about how much money they make, and they don’t care about their employees. Sometimes they control everything – from money to sales. They hover over their employees, do not let them get creative, and do not give them the freedom to do their best. This is a part of the control freak mindset we mentioned earlier. The truth is – if you have this control freak mindset – you will only draw attention to low-performance employees. S

o, to start building a strong team, you must let go of the control. That’s the first and most important step.

Get Your Team Involved With Your Vision

To make people passionate about their work, you have to have one thing first – a compelling vision. Your vision is your greatest asset. And when it comes to leadership you cannot inspire anybody without a vision.

Think about history, when someone wants to conquer a country, they must inspire people by sharing a clear vision of the conquest. The vision inspires commitment. You show them – this is what we’re going to do – and – this is what our victory is going to look like.

Now, when you have a vision, you need to constantly share it with your team and remind them of it. Getting them excited about the vision is one way to build their level of competency and efficiency. Because people go through ups and downs… you have to keep reminding them of the vision and “selling” it to them over and over again.

Here’s a video for you about why it is crucial for leaders to have a strong vision

Show Courage

If you’re unsure about your vision, you better not share it. The only thing you want to share with your team at all times is unstoppable and unshakable confidence.

But then again… leaders also develop cold feet. Sometimes things don’t go as planned and you might want to give up. Commitment to a vision takes courage as well as self-discipline. Make decisions and stick with them. Build a vision, and develop a strong mindset. Your mindset is the key to success. It’s what will keep you going even when you’re not entirely convinced or when things don’t work out in your favor.

Inspire Commitment to Your Mission

When you have a vision you’re secure in – constantly remind your team it. If you’re building a business because you want to be rich – that’s a wrong mission and there’s no vision there to get others excited about. Why would they want to help you get rich? You can’t create a high-performance team that way. You need to have a mission that inspires people – beyond just your own self-gain. The reason being, if you focus on your own self-gain, it may inspire only one person – Yourself.

The thing is, people want to belong to something bigger than themselves. They want to belong to some big vision and know that what they do is important to them. They want to know that you can and want to make a difference and they want to know that this difference will matter in the marketplace. So, think about it and write out your “Mission Statement.” If your team is behind this mission – you will have a high-performance team.

Now, let’s talk about the most important part – maintaining your mission.

Establish A Culture-Driven Team

What makes up your culture is your value. Now that you’ve got your vision and mission, the third pillar of your team is the value of your company. What do you stand for? If you answer this question, you will be able to build a strong team culture.

In our team – culture is the key. People don’t separate themselves into different departments. Everyone is very helpful and supportive of each other and we work together toward our common mission. Everyone has a task, but we work towards our goals together.

We argue, learn, fight, and then get back to work the next day and it’s all forgotten. We may have our disagreements and different opinions, and we love that. Disagreement is where we grow and we cultivate different opinions. We lay down our different options and we find solutions together. We’re focused on growth and excellence.

We are committed to our work and we do not believe in 9-5 schedule. People who are looking for 9 to 5 jobs are not a good fit for our organization. They would not fit the high-performance team we are.

Avoid Self-Gain

If you’re a lifestyle entrepreneur, it’s going to be challenging to build a high-performance team. A lot of people will say: I want to work from home and I just want to make enough money by working from home. or I can choose my working hours when I work from home. What kind of a team can you build with this type of “motivation.”

Is this a proper vision? Mission? What kind of culture does this build? This is all about you and your needs, but where are your team-members? What kind of culture are you striving to cultivate?

You need something big to attract talent. A self-centered mentality will not build a strong team.”... Click To Tweet

Big Things Inspire Millions

When Bill Gates said that he is going to put a personal computer in every household in North America, he presented an irresistible vision. With much determination from his high-performance team and himself as a leader, they achieved their vision.

Now, think about Elon Musk – travel through space – that’s a big thing. The kind of thing that will inspire millions…Even though it’ll take them 5 to 10 years or 20 years to make it happen – that’s a big goal to look forward too and work for. Let’s say you’re not thinking that big.

But not everyone is Bill Gates. So how do you start something small, yet inspiring? What should you do as a leader?

SurveyMonkey survey found that 87% consider access to health care to be a critical part of any job and 65% see opportunities for advancement as the key component of any good job. So, what can you offer to your employees? What are the things that are important to them that you can still offer? What is the big thing that they can have if they join your team that would inspire them to commit and devote themselves to your mission?

Be Upfront With Employees

Working for our team is intense. It involves long hours and hard work. We have high standards and we don’t tolerate poor performance. Bad performers just don’t last in our company. We’re very upfront with that and we let them know what they’re getting themselves into right away. If they’re willing to accept that and if that’s what they want too – they thrive to excellency. Their talents expand and strengthen and our team outperforms itself consistently.

With that said, it’s important to mention that only certain types of people thrive under pressure. They have high standards for themselves. These are the kinds of people that our team pays special attention to. We take time to get to know them…to find out what drives them…how they stay motivated and organized. When we know what drives our best performers, we know how to inspire and organize the rest of the team too.

Make Your Team’s Dream Come True

When you know what you can do for your team and you help them make their dreams come true – you get loyalty. When you’re upfront with your team, they’ll trust you more. Ask them about their personal and professional goals and talk to them about how you can make that come true.

Think carefully about what positions are the right fit for whom on your team. If you know their goals and dreams, you must match them well to the positions they hold and the growth opportunities and possibilities of that position. Your mission and theirs must align, but their expectations and your realities must align as well for your team to be satisfied. Dream big, and manage expectations carefully.

You Are Who You Attract – Inspire More Than Being Driven

We always tell our team – there are no limits to how much they get paid. It’s much more about how much value each of us adds. If you want to make $100,000 thousand income – find a way to add value and get there. It’s simple!

High performance people dictate their price. Click To Tweet

So, if you can be a leader who’s inspiring and compelling, you won’t have any problem attracting talent. You will always have talented people who want to work with you. People will help each other and support each other on the way to the achievement of their mission. If the culture is right – disagreements will occur too. Conflict is a part of growth and a good team needs to know how to welcome opposing ideas and support each other in finding the best solution for all.

That’s the culture that we’ve created because of what Dan Lok is. This is something he inspires in the team. He welcomes differing opinions and ideas. We’re growth-oriented and we focus on excellence.

You are who you attract. Look within yourself...if you attract bad people, you need to rethink your core values, your vision, and mission. Click To Tweet

So, look at yourself…What are your standards? What and how do you perform best?

Surround Yourself With Inspiring Mentors

It’s more of a pull than push effect. Leaders with the high-performance team must know how to create energy and enthusiasm. If you do this well and you inspire people to commit, they will think about how to add more value.

As a good high-performance leader, you need to keep your people inspired and remind them that they are on a mission. You must be a great communicator. Someone who understands people, their psychology, and who can get them talking about their struggles as well as their dreams.

When you are a good leader and you manage to inspire others, you will attract amazing talent – talented people want to follow a good leader.

Good leaders, attract amazing talents – talented people will follow you wherever you go. Click To Tweet

The most important part of your success as a leader is your ability to inspire others. If you can create a compelling vision that others want to be a part of, then you will attract talented people ready to commit and do anything to achieve their goals. This is easier if you surround yourself with people who inspire and drive you.

If you don’t have an inspiring advisory board, then you will not be able to sustain your enthusiasm and drive and it will carry over to your team. Find mentors and advisors who can provide you guidance and be a system of support for your growth. Surrounding yourself with the right guides who will inspire you is the key to your ability to inspire others.

These mentors can be people who helped you as you were building your career and your business, or they can be people in your industry that you find inspiring and want to learn from. It is never too late or too early to get good mentors and advisors. Research and reach out to people you want the support from.

Build An Advisory Group

No great leader did everything on their own. We hear often about how they inspired and motivated others to take action. But what we hear less is who helped them and inspired them to move forward.

The truth is, if you are serious about your growth and making your team into a high-performance team, then you need to challenge yourself to constantly improve and reinvent things. You have to be in the loop, informed and driven to always look for the next best thing, for the next best strategy, and the next thing that will make your team more powerful and more driven. People are inspired by innovations and transformations. It’s a part of our nature.

You have to find a group of people to share your business ideas and struggles with and allow them to take you to the next level. Dan Lok always says that one of the main elements for his immense success in business was that he always tried to be the “dumbest person in the room.” He sought out people who are better, whose businesses are at the next level from his, the ones whom he can learn from and grow with.

Now, you might have great friends and family, but to be truly successful you also need to be surrounded by people who are trying to achieve goals similar to your own. You need to seek out people without any other agenda but providing support to you and your business. Experts who know how to help you grow and build a successful team and expand.

If you do not know people like this already, find a group to join. If you are serious about growing and expanding your business until it becomes a global force, click here to learn more about Dragon 100, Dan Lok’s exclusive advisory board for Distinguished Entrepreneurs. In Dragon 100™, members receive the proven systems, templates, and processes that will take them from $100,000 to $1 million … and then from $1 million to $10 million+ and beyond.