Insight for Independent Consultants
I’d like to help you thrive as an indie consultant
My Indie Experts email list is a place where I do that. If getting better at attracting opportunity via your expertise is interesting to you, please join. Two ways to get this insight; inbox or RSS:
I’m a tiny bit embarrassed to admit that I listen back to every episode of my podcast after publication (http://consultingpipelinepodcast.com in case you haven’t come across it). I’m a tiny bit embarrassed about that because it might come across as narcissistic.But actually I do it for the same reason coaches “go over the tape” with players on their team; to help them improve. I listen back to episodes of my podcast to become a better interviewer and podcast host.What do you do to get better at producing value for your clients? I’m really curious. Send me a note here.-P
What’s the minimum viable version of market research?It’s to know more than nothing.Let’s assume you are interested in specializing in a market vertical. You have some evidence that the vertical is the right size, and it’s likely that companies in this vertical hire companies like yours because you’ve found some competition that’s also focused on this vertical.Your ultimate goal is to connect and build trust with the right people within companies within this new vertical you’re going to specialize in.To do that you’ll eventually need to be able to surprise them with the depth of your insight into their world and the boldness of your expert point of view on their problems.But at first, you just need to get inside their heads a bit, enough to be able to prove that you understand what they struggle with.To achieve this kind of insight, you may not need to speak to a large number of people in the vertical.The following is from a book by Douglas Hubbard called How to Measure Anything: Finding the Value of “Intangibles” in Business:——There is a 93.75% chance that the median of a population is between the smallest and largest values in any random sample of five from that population.——This is called The Rule of Five.It doesn’t guarantee that only 5 conversations will yield the insight you need, but it does remind you that you don’t need a ton of data in order to know more than nothing.Very small sample sizes can often be very useful.If I didn’t know how much Fortune 500 companies spend on custom software development, I would not need to sample all 500 of them. 5 randomly-selected data points would do, because it would get me much closer to a useful understanding of how much they spend on custom software development.Remember, dividing any positive number by zero equals infinity. There is a sense in which any additional data is infinitely valuable to you, especially if you know nothing at all.The minimum viable version of market research is to know more than nothing about the market you’re looking into. 5 high-quality conversations could be all you need to reach that first milestone of insight into your market.Caveats:
- This rule of 5 thing is more relevant for quantitative data (stuff that can be measured with numbers) rather than qualitative data (people’s attitudes and feelings and beliefs). Market research often touches on both the quantitative and the qualitative aspects of a market.
- Even if you are seeking qualitative insight, this idea that knowing something is better than knowing nothing can be very powerful. If market research is overwhelming you, break it down into a goal of 5. Talk to 5 people. Ask for 5 introductions. That kind of thing. Momentum begets more momentum, and starting small is often the key to building momentum.
Want to attract better clients? Identifying a strong market position is step #1. Learn how here: http://thepositioningmanual.com-P
People (folks who are interviewing me for podcasts, etc.) often comment on how specific and narrow my positioning is.Here’s why that works for me…An extremely narrow angle includes a huge volume if the market is deep enough.This drawing is not to any kind of scale, but it illustrates the point:See how much more area is included in the shaded section on the right?It’s the same angle (or meant to be; I drew this thing by hand so don’t get too fastidious about my drawing skills), but it includes a much larger area because the potential market is bigger.When should you go more specific than you currently are?When doing so allows you to create more value for your clients or when doing so allows you to increase your profitability. In other words, there’s no one-size-fits-all answer to the “how specific should my focus be” question because it depends on lots of things.Want to attract better clients? Identifying a strong market position is step #1.Learn how here: http://thepositioningmanual.com-P
A few times I’ve gotten a haircut and my wife hasn’t noticed at all.I’m embarrassed to admit the shoe’s been on the other foot a few times too.Why again are you worried your current clients will notice or become upset by positioning or messaging changes on your website? :)-P
Last Friday I asked y’all: What would you say is the most important single word in a positioning statement?I got some great responses. Thank you to those who responded!Most of you were 100% right. The most important single word in a positioning statement is “for”.Let’s dive into this a bit…While this won’t work for every single positioning statement, there is a sort of bulletproof formula I like to use:[Thing you do] for [who you do it for]So that translates into positioning statements like “Accurate revenue attribution for online retailers” or “Custom software development for higher education” or “Lower churn and CaC for bootstrapped SaaS companies”.All value is contextual.I would pay $100/mo for accurate revenue attribution. Adobe or Microsoft or American Apparel might pay closer to $100,000/mo or even $1,000,000/mo for the same result.That’s why I say the word “for” is the most important single word in a positioning statement. It creates the context for the value of what you provide. It sets the stage to explain who your services are meant to create value for.Caveats:
- There are very valid ways of phrasing a positioning statement that won’t use the word “for”.
- There are valid market positions where the for/who part is implied. The implication is: “my services are for any business that suffers this problem or needs this result”. This is typical of horizontal market positions.
List member Tsavo brought up a really interesting point in his reply.He basically said: “the word and is the most important word because its presence indicates a lack of focus.”In general, he’s 100% right, though there are times when two verticals, or two problems, or two outcomes pair really naturally together. For example, I see some organizations focus on both medicine and life science, for example, and that pairing makes a lot of sense. But in general, the word “and” in a positioning statement indicates lack of courage or clarity. Lack of courage to go for the singular focus where your expertise creates the most value, or lack of clarity about where that focus might be.The first workshop in Specialization School is designed to help you deal with those two problems.The second is designed to help you gain the insight you might need into a market in order to more effectively connect and build trust with them.And the third is designed to help you learn basic outbound lead generation so you have a lever you can pull to generate business in your specialized area of focus. After 3 to 5 years you won’t need this lever, but at first it’s an incredibly valuable bootstrapping tool for a new specialist.The description and schedule of workshops is always available at http://specializationschool.com#schedule-P
I realize the irony of telling you about a service I offer that’s designed to reduce the risk of specializing for you when that thing is a brand new offering that might seem… risky to you.Here’s what some previous participants have said about the first workshop in Specialization School:——When I started this workshop, I had a lot of ideas about specialization and marketing swirling around in mind but my headspace wasn’t focused. Now I am starting to think more specifically in terms of outcomes and value that I can help my ideal customer realize and this has made all the difference in my thinking! I feel more focused, relaxed, and hopeful! Thank you for helping bring about this change in mindset. — Mayank Patel——I found especially helpful the practical steps and exercises you prepared for us, since I knew most of the “theory” but had no idea how to put it into practice. — Alessandro Menduni——Reduce the risk of making the specialization decision, learning how to do market research, or learning how to generate leads with Specialization School.Registration for this round of Specialization School workshops closes this Sunday, April 22nd.If you’d like to listen to a ~40m presentation on the program and ask questions, then come to this webinar at 11:30am Pacific time on Wednesday, April 18th: https://zoom.us/meeting/register/77870978fd9c997b7c24e00bf0acd2b8You can also set up a 1:1 call with me to make sure the fit is ideal: https://calendly.com/philipmorgan/20m-call-to-check-for-workshop-fitThe description and schedule of workshops is always available at http://specializationschool.com#schedule-P
Somewhere along the way I heard the advice: “Never ask a question you don’t already know the answer to.”This is terrible advice, unless you’re a trial attorney cross-examining a witness. In that case, your questions are really more like loosely-scripted dialogue in a sort of play.But in work where your expertise creates economically valuable results for clients, avoiding questions you don’t already know the answer is the worst thing you can do.If the notion of avoiding questions you don’t already know the answer to appeals to you, I suspect it is because you’d like to protect your ego more than you’d like to help your clients. The only thing wrong with this is that it shuts off most of the avenues there are for cultivating exceptionally valuable expertise and helping clients apply that expertise. In other words, the only thing wrong with wanting to protect your ego more than you want to help your clients is it’ll make you a terrible consultant.But that’s probably not you. You probably are interested in learning by asking good questions that you don’t have the answers to.If you’re doing this to learn about a market vertical you might decide to focus on but don’t have much or any experience with, there are 4 ways you could go about it:
- Do what you can via Google searching
- Speak to your competitors
- Do customer development or JTBD research
- Try to get sales conversations happening
The second workshop in Specialization School uses the first three methods on that list.Workshop registration is open now, but closes April 22, so if you’re interested in getting the kind of support and guidance these workshops offer, the best thing to do is to set up a call with me to make sure the fit is ideal: https://calendly.com/philipmorgan/20m-call-to-check-for-workshop-fitThe description and schedule of workshops is always available at http://specializationschool.com#schedule-P