[eluser]BrianDHall[/eluser]
I read a book (multiple times, actually) called "Jump Start Your Business Brain" - really great book.
Anyway, the author pointed out something that seems like very valuable advice to me, so I shall pass it on.
In any business, a venture can be categorized as one of three scenarios:
1) Selling an existing product to an existing customer. This is the easiest sale the make, and also generally the least profitable. It's like being a grocery store and trying to sell a box of corn flakes to someone who already buys cornflakes. You maintain the status quo.
2) Selling an existing product to a new customer. You have a product you know will sell and you know why people buy it, so you search for a new customer. It's like the job of an insurance salesman - its often just a matter of making the calls, getting in front of the customer. Its profitable, it creates growth for your venture, but obviously it suffers from the same problem all existing products has - competition and fragmented markets. Its like trying to get someone to buy Grape Nuts cereal who has never tried them.
3) Selling a new product to an existing customer. Far easier to find an existing need of a current customer and seek to fill it as you already have the contact info, you are already have some reputation, its far easier to get in the door and get that customer who is already happy with you to try your latest and greatest. The downside here is if you are selling something that simply replaces something else the customer buys from you (like when people buy Honey Nut Cherios instead of regular).
4) Selling a new product to a new customer. This has the most potential for growth and profit, but its also the hardest position to be in. The costs are the highest, the work is the highest, you have to overcome lots of obstacles to make even a small sale. Some of the biggest companies took this approach, but when you compare it to all the companies that tried and met with limited success or failure (only to have other companies copy them in many ways and ultimately do better than them) it doesn't look like a great position to be in.
You should try to get yourself into positions 3 and 2 - build customers, sell them your existing products to maintain status quo and develop new ones to meet their needs (which will be must easier to make work because you already have customers to try it out on and either buy it or give you feedback on why not).
Position 4 requires lots of staying power and dedication. For every Twitter there are literally thousands of websites that you've never heard about that never got anywhere.
