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Hey, this is Sasha and welcome to another episode here on backstage income where I share with you how to build and grow a profitable business.
In today’s episode, we’re going to take a look at a Product Ecosystem.
If you’re developing a business online or if you’re thinking of developing any kind of business at all, you need to be thinking about an ecosystem within your business.
It’s one of the more profitable ways to increase your revenue, to increase your sales, and to really just start thinking about your business not just as a single product business but as a real business that’s generating revenue from multiple product streams.
Let’s get started.
When we look at a product ecosystem, we’re going to cover four main things:
- We’re going to take a look at what is it
- I’ll share with you an idea behind it
- We’ll take a look at scaling and growing and the retention of the business
- I’ll give you a quick tip at how money is made
What is ‘Product Ecosystem’?
When building a business, a lot of people think of their single product right here as their business. It’s a single stream income. It’s one product — that’s the money you’re making.
This is fine and good. You got your product and it’s making you revenue consistently time and time again but unfortunately, it’s one product.
If you look at some of the big boys like Apple, Microsoft — any company at all that’s quite big — they normally have multiple product streams.
Or in other words an ecosystem.
If I take a look at Apple and you look at their whole business structure, they don’t just have one product in the mix. They have one product, might be the iPhone, then they have another product over here that generates some more revenue.
They have a handful of products that are generating revenue and income for them.
Let’s say a customer wants to buy an iPhone. If they like the iPhone right here, they might decide to buy an iWatch.
So instead of one $500 customer, it could end up being a thousand dollar customer or $1500 customer or $2,500 customer.
You’re increasing the scale or the amount of money that somebody is spending.
That’s what a product ecosystem really is.
An idea bank for your own business
Let’s say you run a dental marketing business.
So, you’re doing services for dentists. You’re running a marketing service for dentists.
How do you structure a product ecosystem for that?
We start out with the service part. One of it could be the service that you’re providing — this could be the coaching, the consulting.
One could also be setting up a website — again, you’re generating and making revenue.
The other part of that leg of that business could be training. It could be training in terms of ebooks or books. It could be courses. It could be software training. It could be team training. All of these could fit under training.
Depending on — are you more tech marketing company or are you more of a training company or are you more of a service company for these dentists?
Scale, growth and retention
As I look at scaling and growing and retention, I’m looking at how do I increase these things? I’m going to tie these two together — scale, growth, and retention and then the next step.
How money is made when it comes to the business
How can you make more money?
- Number one, you can increase the number of customers
- Number two, you can increase the dollar value of that product.
- Number three, make customers stay with you longer in time
Do I need to get more customers? That’s what most people really focus on.
Do I want to increase the dollar value or the cost for the end-user or reduce your own expenses?
Or number three, keep them long time value of a customer?
If I’m looking at scaling and growth and I have these three things in mind, I have to also think about how do I increase the customers.
Instead, what you want your product ecosystem to really do is the cost of these products should slowly continue to grow with time.
You would want to ramp up these products to a higher level.