Building and growing your own business can be a wonderful part of your personal growth journey. Making a new business profitable and successful is a real challenge by itself, but you also want to be careful to avoid creating a business that seems to be doing well while it’s actually killing your lifestyle. There are many decisions you can make that may be financially lucrative but which will create negative lifestyle consequences for you.
In this article I’d like to share some tips on intelligently balancing good business decisions with lifestyle issues.
It should be pretty obvious that if you want to create a viable business, you need to get potential customers coming to you, your website, your store, etc. What I want to stress in this article is that each method of attracting people to your work will have lifestyle consequences for you.
Many people dislike marketing. If you choose to market your business in a way you hate, will that lead to a viable business? Probably not. Most likely you’ll procrastinate on marketing because you won’t like it, and your business will suffer. This happens to many would-be entrepreneurs.
Fortunately there are enough marketing possibilities that you needn’t choose marketing strategies that you hate. You only need one or two effective methods that you like enough to do on a regular basis. When you find something that’s effective and that you like, stick with it as long as it continues to be effective and enjoyable.
My favorite way to attract interest in my work is by creating and sharing an abundance of quality free material. This not only attracts people in large numbers, but it also generates feedback that’s useful for building and growing a business. I learn what people like, and I discover better ways to match my skills to their needs and desires.
Giving away lots of value for free isn’t practical for every business, but it can work very well if you love to create or if there are good ways to distribute something you’ve created for free.
I don’t want to manage ads — that would bore me to tears — so I don’t do any advertising. But I love to write, so I write a lot, and that’s really all the marketing I need to do. I can even take extended breaks from writing when I so desire.
With my old computer games business, I provided free versions of each game. The free versions would promote the paid versions, which had more levels or features. This model is still effective today. When I did this during the 1990s and early 2000s, there wasn’t a central repository like Apple’s App Store where lots of traffic all went to the same place. The marketplace was very decentralized. So I spent many weeks uploading my game demos to hundreds of smaller game download sites, which were common back then. Most of those sites didn’t generate many downloads individually, but they all added up. This approach also helped my search engine rankings because most of those download sites also linked back to my website, so it was a good strategy for getting hundreds of free links. For many years my games website ranked high on Google (often #1) for terms like “free game downloads.”
This was a boring marketing strategy, but I only had to do it once for each game. Eventually I paid someone to do it for me. Since other developers found it boring too, some of them programmed their own submission tools to speed up the process of submitting games and software to hundreds of download sites, so it got easier over time.
When you run your own business, you’ll discover many ways of attracting attention. Avoid the trap of adopting marketing methods you dislike; otherwise you’ll damage your lifestyle. Concentrate your efforts on the marketing methods that suit your skills and personality. Keep your methods aligned with your desired lifestyle.
I take a humanistic approach to building relationships in business. I don’t like using words like prospect or client to refer to human beings — those sound cold and corporate to me. I usually don’t think of the people who visit my website as customers either. Publicly I may refer to them as readers or some other neutral term, but privately I like to think of them as like-minded people who have a shared interest in personal growth. We’re people who want to live consciously, to grow, and to live rich and interesting lives. We want to live more intelligently.
Many new business owners discover that it’s easy to make your business a hellish nightmare if you attract the wrong people — the wrong customers, the wrong employees, the wrong business partners, etc. Note that wrong for you doesn’t necessarily mean wrong for someone else’s business though.
The nice thing about running your own business is that you have some flexibility in deciding how you want to relate to the people you serve. You don’t have to copy someone else’s approach.
For some businesses it’s important to discourage patronage by people that you cannot serve or do not want to serve.
For example, many people with mental illnesses seek out personal growth info online, and some of them find my website. If I can serve such people along with everyone else, I’m glad to do so. But some of these people have severe conditions, and I’m not capable of serving them as customers or playing the role of mental health counselor for them. I don’t want to attract people who feel compelled to email me indecipherable rants with threats of violence against me on a daily basis. Generally speaking, I don’t want to attract relationships that could hurt my motivation to continue in this field and make me want to quit.
Some great bloggers have quit blogging altogether due to attracting too much of the wrong kind of attention. We can try to fight such unwanted behavior, as many people do, especially if there’s a chance of encouraging broader social change. But another alternative is to swerve a bit by making a few adjustments to how you run your business, so as to attract less unwanted attention and more of the positive kind.
This is largely a calibration issue. With experience you’ll learn to attract people to your business that you love serving. Attracting the right people can make your business a joy to run, and it’s much easier to make your business successful when you feel delighted to go to work each day.
One of the most powerful business lessons I learned was the importance of deliberately choosing business models that I’d enjoy using and which were highly motivating to me, and by extension, abandoning business models that created negative lifestyle consequences such as high stress, excessive time pressure, or unpleasant customers.
Conduct Promotional Events
This isn’t a business strategy that I’ve used much, but I know others who’ve used it to great effect. I tend to attract so many people with my free material — StevePavlina.com is well past 100 million total visits — so I have the liberty of skipping this step because I don’t need a very high conversion rate. That said, I could be doing better financially if I paid more attention to this step.
A promotional event, such as a webinar or teleseminar, gives you the opportunity to engage more deeply with people, to provide more value to them, and then to invite them to become customers.
I’ve thought about using this approach for one of my workshops, such as by hosting a free webinar to give people a taste of the live experience. I may someday use this approach. But there’s a reason I don’t use it, which has to do more with lifestyle aspects.
If you skip this step, your conversion rate is likely to suffer. You’ll be asking people to take a bigger leap from initial attraction to paying customer. Many people won’t cross that gap without more hand-holding. I suppose you could say it’s like meeting someone and then asking them to sleep with you… or to marry you. Most people can’t say yes to that sort of thing so quickly.
On the other hand, think about the people who would say yes to such an invite. They’re likely to be very enthusiastic about your work. While other people may need more convincing, these people don’t need so much convincing.
This is another of those calibration issues that’s different for every business. I happen to like doing workshops where the people in the room really want to be there and didn’t take much convincing to show up. It’s such a different experience than speaking to other audiences. That’s why I prefer not to try so hard to convince people to attend. It’s also why I don’t offer bribes to sign up for my mailing list. I know this means I’ll be doing smaller workshops and that I’ll have a smaller mailing list than I otherwise could, but it also means that for the most part, I’m only dealing with those people who are the best fit for my business and lifestyle.
This also helps me on a design level. I can design my workshops for personal growth enthusiasts, not for people with a casual interest. This encourages me to make the workshops more active and fun, and it creates a positive social experience for the attendees as well.
Promotional events require advance planning and scheduling. If you can handle that, great. If you prefer to see your calendar remain blank, you may want to avoid pre-scheduled promotional events.
Convert People to Customers
For lifestyle reasons I don’t pay much attention to conversion rates with my current business. But I used to pay a lot of attention to it when I ran my computer games business, especially the percentage of people who bought a game after trying the free version. I had many other software and game developers as friends, and we all wanted to increase our conversion rates. Many people found that they could increase their conversions dramatically with a few simple changes, such as by making their “buy now” buttons easier to find.
If I recall correctly, I was roughly able to triple the conversation rate of one of my games by packing in a lot more value and by increasing the difference in value between the free and paid versions. In the first release, the free version had 10 levels, and the paid version had 30 (including the original 10). Then I dropped the free version down the 5 levels and built the paid version up to 75 levels. The following year I released a gold version with 152 levels. The more value I packed into the offer, the more the conversion rate improved.
During the 1990s it was common to include about a third of a game’s content in its free version. Id Software especially popularized that approach. Today many more game developers have figured out that a 2-to-1 or 3-to-1 ratio of paid to free content leads to weaker conversions than offering 5-to-1, 10-to-1, or better.
With blogging it’s a different story. The ideal ratio there might be on the opposite end of the spectrum, where lots of free content can support a small amount of paid content. Partly this is because blog posts are easier to create and share than game demos.
Be sure to consider the lifestyle issues of converting people to customers. You may attract many people to become interested in your work who wouldn’t make good customers for your business. A common mistake is trying to convert people who don’t have enough money to reasonably afford your product or service. You can avoid this mistake by creating your sales materials from the perspective that you’re pitching your product or service only to people who can afford it. Don’t apologize for your pricing, and don’t feel compelled to offer discounts.
It can be helpful to think of your audience in terms of three groups when it comes to pricing:
- Price insensitive – These people can easily afford what you offer. It doesn’t matter that much to them what you charge. Often these people want the best quality they can get. The specific price is usually not that important. Apple products appeal to many of these customers.
- Value seekers – These people love a good deal. They look for the sweet spot that balances quality and pricing. They’ll buy if you can offer them strong value, which means good quality at a good price. Otherwise they’ll pass until you make an offer that’s really attractive. Think Costco shoppers.
- Price sensitive – These people would only buy from you at rock bottom prices, if at all. They’re willing to sacrifice quality if you can bring the price lower. Think Walmart shoppers.
About 2/3 (call it 67%) of my readers are in the value seekers group, at least when it comes to personal growth expenditures. Another 10% are price insensitive, and 23% are price sensitive. Knowing this gives me some options for how to price my products and services.
If I wanted to, I could do premium workshops for the 10%. I could price them high and promote them only to people in that group. A number of people have actually suggested that I do that. I don’t like the idea of designing events only for price insensitive readers though, so I don’t use this type of pricing. This may have something to do with the fact that I spent many years of my own life being way too broke to afford such events.
Targeting the price sensitive 23% doesn’t feel good to me either. For the live events I do, the biggest expenses are usually travel and lodging, not the cost of the workshop itself, so it doesn’t make any sense to target this group, at least not with live events. The airfare alone will discourage them from going.
So I usually target the value seekers. To serve this group well, I look for ways to increase quality without increasing prices. A big part of that involves picking the right venues. Our Las Vegas workshops have been hosted at mid-range hotels including Harrah’s, the Flamingo, the Tropicana, and the Golden Nugget. I’ve never done events at the Bellagio or the Wynn where hotel guest rooms can be triple the price since most of my readers wouldn’t want to pay so much for a hotel room. Nor have I done events at cheaper properties where I feel the quality sacrifices would detract from the experience.
When I did one-on-one coaching, however, I couldn’t afford to target this same group. I had to limit this part of my business to price insensitive customers by charging a premium price. Otherwise I’d attract more clients than I could handle. So keep in mind that you may need to use different pricing strategies for different products and services.
For this item I’ll share what I see as one of the biggest risks today, which is the mistake of working very hard to serve and retain non-customers.
Today many people are caught up in social media hype. Supposedly it can be helpful for your business if you’re active on social media, but as many people are discovering, it can become a distraction as well. You can easily invest hundreds of hours interacting online with people who aren’t your customers.
This type of activity can feel like productive work, but is it really? The problem is that while you’re doing these types of interactions, you aren’t spending that time interacting with your paying customers or thinking up new ways to serve them. You may be keeping yourself busy, but you aren’t spending your time creating quality products and services that your customers will buy. If you go overboard to serve non-customers, you can easily starve other parts of your business for attention. This isn’t sustainable.
I think it’s wonderful to be of service to people whether they’re customers or not. I love that I’m able to provide value to people worldwide via my website, including people who will never become customers of mine. But I’ve learned that it’s important to do this in a scalable, sustainable way that doesn’t result in negative lifestyle consequences. My web traffic can scale, but I can’t scale up my individual interactions. I’ve had to make some careful decisions over the years to ensure that having a high traffic website doesn’t lead to a messed up life.
If you’re struggling to make your business profitable, ask yourself if you’re working too hard to retain (or to entertain) non-customers. Are you attracting fans and followers who want to engage with you but who seldom buy from you? Are these kinds of interactions helping you achieve your business and lifestyle goals? Do you want to keep doing what you’re doing for many more years?
This is yet another calibration issue. It will take some experimentation to find the right place of balance for you. You can expect to make many mistakes along the way. Sometimes you’ll be way too generous. Other times you’ll be too stingy.
I hope you enjoyed this walkthrough of business vs. lifestyle decisions.
October 21 - 23, 2016
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