Whether you read about membership organisations like GKIC, Entrepreneurs’ Circle, Funnel University or about gadget and IT companies like Amazon or Apple, you will have heard about the importance of product ecosystems or ascension ladders.
What this really means is a set of services or products that can all be sold to the same customers, in order to meet different demands, but stop your existing and new customers wandering off to the competition.
Finding new customers is the most expensive way to grow your business, so you will be well served to work out what else you can sell your existing customers.
When you buy a new car from any of the main manufacturers, they are able to set you up with insurance, finance and service. Often, these services make more profit for the business than the selling of the car in the first instance.
Apple is another great example of this. If you own an iPhone, iPad and AppleTV, have Apple CarPlay in your car and a Mac in the office, it is very difficult for another manufacturer to persuade you to buy their product, when any one of these needs an upgrade.
If you were to replace your iPhone with a Samsung, you will become acutely aware of the fact that your phone is sitting somewhat outside your tech environment, and changing all your technology will be painful and quite pricy too. Because of this you are much more likely to replace an existing iPhone with a new iPhone.
Not only does it create a very strong position for your existing products with existing customers, but it is also provides a very strong position from which to launch new products.
Imagine Apple launching the AppleWatch as it’s first product, or as a standalone product outside of the strong ecosystem they’ve created. It would not be selling at nearly the rate it has been.
I was reminded of this last week when I received an email from NEST. The manufacturers of smart thermostats, smoke alarms and CCTV cameras.
We’ve recently completed renovating our house, and part of the work included installing NEST smoke alarms throughout. These are very clever bits of kit, which alerts us of an alarm when we are not home, as well as letting you know specifically which alarm in the house was triggered. It also notifies you once the smoke has cleared and tests itself every month, reporting any faults if there are any.
One of the list items I wanted to add to the house was a smart video doorbell. This was delayed because we had delays having the new front door installed, so I have not bought one yet.
I was pretty much settled on having the new version from ring.com installed, just had not got round to it.
Until I received an email from NEST last week telling me that they are launching their own Video Doorbell (NEST Hello) in early 2018.
This immediately caused me to look into it and decide that I’ll wait for more info on this before I decide. This means that ring.com can do very little to get me to take action and buy their product anytime soon.
I know if I buy the ring.com product, it will do exactly what I need it to do and will work really well, but it will mean yet another app on my smartphone and another app I need to persuade my wife to use. Waiting for the NEST product means it will link up to our existing system and slot into what we are already familiar with.
The quality and ease of use I experienced with the NEST products we already have is another reason why I’m now loath to consider another option.
Creating this ecosystem of products has given NEST an unfair disadvantage with me as the customer, and you can create the same situation in your business.
What can you provide your existing customers, that they may already be buying from someone else, or may need soon?
What can you provide to new customers as an introduction to your services, which then leads to more opportunities for you to solve problems for them?
Ultimately that is what we do in business, we solve problems for our customers. The more problems we solve, the better we do in business. (Check out the 5-Day challenge for more on this.)
What problems can you solve today?
Author: Pieter K de Villiers
Pieter K de Villiers is slightly obsessed with systems. The systems and process automation he builds for small businesses are transformative, to say the least. Pieter is a Co-Founder of Barefoot Digital and the Amazon best-selling author of “Barefoot Business: 3 key systems to attract more leads, win more sales and delight more customers without your business killing you”.