BBO Show with Kyle & Harms


Work out what value you will provide your new niche


What you’ll learn in today’s show

BBO.SHOW #22 – Work out what value you will provide your new niche

Hey Harms here, thanks for watching today’s show, if you have not yet then…

What you will learn in today’s show:

  • What is considered valuable?
  • How do we create something of value?
  • Become a problem solver
  • What problems do we decide to solve?
  • Accessing the world’s problems
  • and more

The focus area is: Business niche.

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Read the transcript instead…


BBO.SHOW #22: Work out what value you will provide your new niche

Kyle: We are talking about business. 

We are really drilling down to the foundations of online business by discussing what business actually is and what activities you need to be performing before you jump online and get excited. 

We need to know what exactly our business is and this is a step not that many people take when they jump in. 

I think for a lot of people they’ll come away thinking I’ve been doing it wrong all this time or they’ll get angry with us. 

Either is fine it means you’re actually thinking about it.

Harms: We are talking about getting the basis of the foundation set critical, it’s essential. 

Yes, it takes time, but it’s going to save us a lot of time and money in the future and going forward. 

Now we know who we’re talking to, which marketplace we’re going to talk to. 

The next big question is, what value do we now provide these people out there within this niche marketplace? 

Niche is the important thing that you would have identified.

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Kyle: Every single successful business out there, they are successful, they are still in business because they create something of value. 

This is at its core what a business does, remember the five elements of business that Josh Kauffman outlined. 

The first element in his five elements of business is value creation, a business needs to make something that is valuable, otherwise it’s not a business, it doesn’t really exist. 

There is no business at all, and that’s what we’re going to be focusing on is what can you create that is valuable? 

The physical or digital manifestation of this might be a product or service, but we’re peeling back the layers a bit more and talking about value. 

What value is and how we recognise value and how we provide value?

What is valuable?

Harms: The first question we can start with is what is valuable?

Okay, I appreciate what Josh Kauffman has said, we need to create something of value that’s one of the first stages within the five business elements he speaks about. Then we ask the question, what is valuable and the best way to determine that is who determines what is valuable? 

Is it, Kyle? Is it Harms? Is it and the media and what they portray? 

None of those people or factors determine what is valuable and what is not valuable, there’s only one person that determines what is valuable and that is the market. 

Not you, not me, not Kyle, not our friend down the pub. 

None of those people determine what is valuable. The only person that does and I’m giving them an identity is this abstract thing called the market.

Kyle: You are not the person who determines whether what you have created is valuable and we see this on Dragon’s Den again and again, when someone has created a product and they are utterly sold on the value of their own product. 

They take it in front of an impartial panel for the first time and it doesn’t matter how much you love your product or you love your service and how much you think it’s valuable. 

It’s really only the market’s opinion of your value that matters. 

It is the market that determines whether what you have to offer is valuable or not.

Harms: So then how does value then determine if we are saying it’s the market, how does the market determine value?

Kyle: When we started this process we really dived first with the market. 

We can’t start to determine what is valuable and what isn’t valuable unless we know who the market is. 

We start with the market first. 

We went to look for a market and then we’re going to be providing a product providing value into the market. A lot of materials in this example have gold and diamonds they might have some basic utility which determines value. 

So gold yes is a really good electrical conductor we use in our electronics, diamonds are really hard so good for cutting stuff, but we have overlaid on top of that massive value on top of the base level value that comes with utility. 

So now when we talk about the value of diamonds the fact that it’s useful for cutting is a very small part of value, instead it’s about wedding rings and that was from marketing. 

That was a company called DeBeers who 150 years ago put out a really good marketing campaign about the importance of buying engagement rings worth two months of salary.

They set the value so lots of people now might assume diamonds are valuable, but that was created by an impression that we have with diamonds. 

This is the same with any product out there and any surplus, so value is very much determined by what people are willing to pay for it and very much by the market. 

We start with the market and we’re going to be looking at how we create value for that market.

Harms: If the market values what your product and service is, let’s give another example of putting this into perspective. 

So who has a greater value on water? 

Is it a person stranded in the desert and how much would they value a glass of water stranded in the desert, the Saharan desert. It’s hot, it’s dry, they have no water for a while. 

How much are they willing to pay for water versus how much do we value water when it is running clean water from a tap at home? 

We don’t think about it in that way. 

If the water board suddenly said, we’re going to charge you the same as what we would charge somebody who is desperate for water in the Saharan desert there would be uproar. 

Because we don’t value it, regardless of the importance and its utility and the importance of it theoretically, we should be paying more for this than we do for anything else. 

But that’s not the case because a perspective has shifted. 

What about price? 

Because I’m chatting to a client and they’re debating how much value to put into a product they are creating based on the price it’s going to be sold at. 

What’s the link between value and price?

Kyle: Often we use value and price interchangeably. 

Even in the last five minutes we’ve made this mistake and in everyday life it’s the same thing, we talk about value in terms of pounds or dollars or euros or whatever your currency is. 

It’s so easy to interchange value and price but they’re not the same thing. 

We can use price as a rule of thumb because it is used interchangeably in common speech, but somebody in the Sahara desert is going to pay a lot more for a glass of water than somebody else here. 

The value they have is very different. 

One of the reasons why we do separate them is because we can do clever things with pricing strategies, we can make something appear more valuable by charging a higher price.

Which is why when we talk to clients we often say you’re under-pricing a product because sometimes, if a customer sees a product and it is half the price of the competitors out there the assumption will be, “oh, it’s half the value or half as good as a competitor’s product.” 

Whereas maybe it’s just a cheaper price maybe it’s a really good deal but because customers and human beings in general we use price as a proxy, we use it as a rule of thumb for value we tend to automatically, psychologically value something higher if it has a higher price. 

That’s why we need to be careful about talking about mixing the two up, we’re talking about value and not talking about creating a high price item, we’re creating a high value item. 

That said they’re also interchangeable and Harms and I might make that mistake again just saying price.

How do we create something of value? 

Harms: But they’re not the same thing but they are connected. 

Then how do we create something of value? 

We know it needs to be something that the market wants, the market will determine what’s valuable so we’ve got that part. 

We know it’s not me, Kyle, you or what we deem as valuable. 

The market will determine what is valuable, so now we decide what is valuable? 

We pulled a reference from Paul Graham for this part, which is, make something people want. There’s nothing more valuable than an unmet need that is just becoming fixable. 

If you find something broken that you can fix for a lot of people you found a gold mine. 

So that’s it in a nutshell, how do we decide what is valuable? 

If we summarise what he’s saying, it’s saying we create value by solving problems and he’s saying the more people’s problem that we can solve the more money we will make it turns into a goldmine. 

The message from what Paul Graham is saying is we create value by solving problems. 

That’s the key.

The best way to create value for a market is to solve problems. 

Kyle: T Harv Ecker talks about how an entrepreneur, business owner is a problem solver. 

That’s what you do and so that’s how you create a business to solve problems. His quote is, the way to make a lot of money is to solve problems for a lot of people. 

So the more people you can help solve problems for the more people who have something broken you can fix in the words of Paul Graham the more successful your business will be. 

To create something of value we need to know what the problems are and then we can set about fixing them. 

This really requires a shift in your mindset about how you approach business, why you’re getting into business and how you operate on a day to day basis.

Becoming a problem solver

Harms: How do we shift that mindset and become a problem solver? 

Because the reality is, and I don’t know if there’s a correlation between business failures, business change, etcetera but a lot of people get into business purely for themselves. 

That’s a reality and we get that, you’ve got bills to pay, you’ve got a dream of financial independence. 

You’ve got a dream of a really nice car, holiday home. 

All of that will come from the fact that I want to create this business because it’s got something in it for me and a large part to do with that is often to do with the money involved and the money potentially that can be made and all of this is fine. 

That’s probably needed as part of the motivation to go do it. 

Money is a factor and that will be a reward as we solve the problems. 

But the reality is the market couldn’t care less about what I would want as an outcome from this business. 

A customer doesn’t purchase from me thinking I’m so happy I can send their kids to private school. The market doesn’t think like that. 

Here’s the thing, it is not against you, it’s not for you, it’s just indifferent.

It’s not positive or negative, it’s neutral, it doesn’t care about your problems or your successes.

That’s the first thing to understand about becoming a problem solver is that it’s not about the problems you’ve got to solve internally, all that stuff that you may have as goals in your life, that’s great but the market doesn’t care. 

That’s the first mindset shift to get on board with. 

Once we know that and the end customer the market is indifferent to any of that, then we can now move on to the second part, which is actually solving their problems. 

Kyle what’s your thoughts on now shifting over to that kind of mindset?

Solve their problems – Not yours

Kyle: Once we’ve managed to clear out our problems from the equation we have more space to think about the problems of our customers, the problems of the market. 

We create value by solving problems. 

Now we have space to take in the problems of the market and start working on solving those. 

Ultimately this is how we’re going to build a business. 

We will be solving their problems not our problems and this is a big difference. 

There’s a nice side effect of doing this by solving the problems of other people you are creating value, by creating value you’re going to get paid for that which means your business is going to grow and your problems will be solved. 

It’s a win-win but we have to start by solving their problems instead of focusing only on our problems.

Harms: The way to think about this in terms of the next step is the more people’s problems I can solve as a by-product, a side effect we’re going to make a lot of a cash, that’s a bonus, but let’s bring it back down to the core, which is I know need to solve their problems. 

So what’s the next mindset shift required? 

That comes from constantly just talking at somebody and flipping it on its head and listening first, then providing an answer and the best way to think about this, and if you’re in business currently, whether it’s a different generation or our generation. 

This thing we call networking still exists or Zoom call or a group of people within that networking environment there’s always somebody whether it’s the lead speaker, but often I’ve experienced it with the interaction now you’re networking. 

In this process, you’ll often hear somebody tell you what they do, how they can help you, here’s their website, follow them on social media and at no point do they start the conversation which is look, I appreciate you’re here do you have any problems? 

Do you have any challenges going on at the moment that I may be able to help with? 

Now a good mentor, someone we both mutually know called Mark helped get this into my head because when he runs networking meets the first thing he does before he starts reading off anything about him is he says, put your hands up if you have these common problems. 

He’ll say raise your hand if you have this problem and start to put people in buckets and then can quickly identify where he needs to spend his time on in terms of his talk in terms of the advice he is giving, because actually most of the people have X problem. 

They don’t have a ‘Y’ problem whereas most people walk into the room ready to talk about what they have to say, not answering the question people have. 

So flipping this on it’s head and listening first and then answering is amazing and the amount of businesses or ideas you’ll be able to solve and start based on just that principle alone is going to be remarkable. 

Now we’ve shifted from understanding that the market decides, we have to solve their problem not ours. 

Listen first then answer

Harms: The third thing is the way we can do this is by listening first, then answering. 

What is the final mindset shift that somebody can on board and again, this is not going to happen instantly. 

It took me years to stop talking about myself and go to a networking meeting and say what’s going on? 

How can I help you? What’s the challenge you’re facing? I may have faced them myself. 

Once somebody gives you a problem that your service already aligns with, then it’s a lot easier to talk about the service that you provide, so listen first and then answer. 

What’s the next mindset shift?

Kyle: More generally, we also need to learn to give before we receive and preferably give more than we receive back. 

A lot of entrepreneurs because they’re focusing on their problems, it’s all about what do I receive? 

How do I get that money now? 

You need to prove your value first. 

This is especially true online because it’s such a busy space with lots of people talking so you need to prove your value and that you’re trustworthy. 

If you focus on solving your problem which is money and if you just tell them your solution about listening you’re going to be ignored.

Harms: And online it’s even more challenging to receive. 

As busy as it is the amount of people vying for your attention, your money all of those things become a lot more challenging online. 

It is like taking the off-line world and putting it on steroids because there’s that many people who you’re trying to receive from.

Kyle: Which is why it’s so important to prove your value first and to do that we need to give first before we receive, you will receive.

That will happen when people see the value when you help solve their problems they will reward you for that. 

This is hard especially for people getting into an online business for the first time, because if you have a job you’re used to doing a set amount of work and you get paid, you expect to receive it immediately and that’s not really a question when you are salaried. 

When you are starting your own business it’s not the same as receiving a paycheck. 

You need to go out there and prove your value, your work, which is why it’s much riskier than just receiving a paycheck. 

But if what you do create, give to the market is really valuable and they recognise that then the rewards are much, much, much higher. 

But it’s up to you to prove that. 

Harms: It is an extremely difficult shift because that’s the final part which many people may be an employee or they used to getting paid for the work pretty immediately. 

Even freelancers will sit between this, which is I’ve done this work for you now I’m going to get paid. 

We’re taking this to another level which is becoming a business owner whether it’s online it becomes extremely challenging because sometimes and we faced this, you have to prove your value for months on end, you have to prove your value in some cases online depending on what niche you’re for years before you can be remunerated for that. 

Which is why some people are suited within a job ecosystem. 

Some people are suited within the fact of actually I’ve got this mindset which is I understand I have to give, give, give and my time will come, however you want to describe it you will receive at some point in the future, but it comes with a mindset shift. 

It comes with the fact that you will get paid at some point in the future but because you have to prove your value in order to do that first, and the tough thing is we don’t know how long you have to prove the value.

Kyle: It is up to the market entirely. 

We can’t tell you how long it will take. 

It depends on what problems you’re solving for which market.

What problems do we solve? 

Harms: Then we move into the next big question which is what problems do we solve? 

Because we now have identified we need to create value by solving problems and we know we need to focus on them not us, that is amazing. 

But what problems do we then solve? 

Now what do we do because we could do it the old way, which is surveys, focus groups and just head out there in the world and say what problems do you have? 

Now what if we told you that a company exists and it’s got a database of information which you can have access to?

I’m building up the value here, but this database will give you everybody’s problems. 

It will give you all the problems people are having in the world and it will lay it out. 

What if we said you could have access to that?

Accessing the world’s problems 1240

Kyle: It is a little boutique agency known as Google.

When you go to Google you’re asking the Internet a question, a search query is the technical name. 

It is a question, it doesn’t matter whether you phrase it as a question. Google is the largest problem-solving platform on the planet.

We use it for absolutely everything. 

It is the way we find information. 

We all use Google on a daily basis to ask questions because we have problems now the great thing is all of this information is available to us as business owners and we’re going to be using that.

Harms: Back in the day you could purchase a mailing list that gave them those examples of people’s problems. That meant you had to go purchase a list that was viable for a set period of time, you answer problems, lots of factors that play into that. 

What we’re saying is we can now take it to another level, which is access the world’s problems, 24, seven globally as well. 

There are two ways we can do this the complex way and the simple way. 

The complex way is we can go into a deep dive in Google AdWords and identify and pull out data from people’s essentially search queries on I have this problem and even as far as what kind of adverts they’re clicking. 

If we are looking at Kyle’s business how to learn Chinese we can even restrict that to the UK, now we can look at the data and start to segment it whether it’s geography, interests, but we can restrict it to the UK. We can narrow it down to London. 

You can look at how many people search for this information per month and you can compare lots of different criteria. 

Now this is great. 

This is great if you are data driven.

Kyle: It is a free tool and you can experiment with it.

Harms: At this stage it’s complex and is too much for now and the assumption is some people have that skill set some people won’t. 

What can we do to be indifferent to whether you have the skills or not like the marketplace and give you a more simpler version?

Kyle: There are other companies and other websites that pull that data from Google and make it more accessible to us, with just the information you need to know and they get rid of the extra information. 

The one we use a lot is a website called answer the 

It’s free and you can do three searches and then after that you can get a paid account, but you can just go back the next day if you need to keep doing searches. 

The basic idea is you plug in your niche and it needs to be one or two words, it shouldn’t be pilates for men between 50 and 60 with back problems. 

It shouldn’t be something long like that as you won’t get any information it should just be pilates, or pilates back pain. 

Technically, it should be one or two words tops and that’s going to give you the best results. 

For example I put in backyard chickens and what answer the public does is it pulls questions, the problems, the top concerns that people have. 

People are going to Google typing these questions to learn more about backyard chickens. It gives us a really good rundown of the things on their mind, what they’re worried about, what they want to solve. 

I like to go to forums and groups and see what terms they use and then get the most out of the tool. 

Backyard chickens are an amazing example of a niche as when people are thinking niches they’re thinking about pilates. 

But if people are making good money doing something obscure such as raising chickens in your urban garden that gives you an example of you can really make money online if you find your niche and it doesn’t really matter how odd it is. 

As long as there is a market there is a business.

Harms: We’ve gone from identifying the fact that what is valuable, how do we create something of value? 

How do we shift the mindset of becoming a problem solver and now we are accessing the world problems that they have given to Google and then Google gives it to marketers, niche identifies, people who want to start a business. 

The difference between my gut feeling on what people are asking about backyard chickens instead these are real questions from real people. 

Who are these people? 

These are the markets. 

You identified the who, the market and now we’re talking about what problems do these people have within this market? 

What are their real problems?

Remember the logical chain we’ve built to this point is we build a business by creating value for our market, logical chain. 

We create value by solving problems for our markets, the who and what. 

It’s very powerful. 

What problem does this market have?

Kyle: We’ve identified a niche that’s really popular and we’ve identified real problems in that niche, and that is such a powerful place to be. 

Once you have the problems you can answer then and that creates value, that creates  a business.

Harms: So if you’re ever curious about how people make money this is it, they identify a niche. 

They find out what problems people have within the niche and then they get on and do it. 

That’s what they’re doing, they’re not selling the idea of backyard chicken protection or whatever it is. 

They’re not selling the idea they’re building a business from the niche they’ve identified. 

We’re not talking about a product; we are not saying great you can dive in and start creating a product around that one question.

Kyle: Right now we’re talking about what value we are producing. 

Now you’ve identified a problem this is where your creativity kicks it. 

This is where we can start to think this is a real problem. 

There are 5,000 people a month searching for how do I stop my backyard chickens flying away in the UK, that’s the market. 

That’s a real problem now I can exercise my creativity and my imagination and create products and services to help the problem. 

It might be a training manual about how to keep your chickens safe. 

We don’t know what those products are but now as an entrepreneur these are the problems you solve.

One final note on deeper problems

Harms: A final note on problems and looking at them in a deeper way. 

Looking beyond the surface because what we’ve done now is amazing but it is surface.

 We’ve looked at the problem of runaway chickens. 

That’s the problem that people have and they come to the Internet with that problem and we can help them solve that. 

But what is the real problem and the deeper we go, the more we can solve their true problem. 

So what are we talking about here Kyle? 

Because often people are talking about and in my mind I think of it as features and benefits, but let’s talk about it as solving the problem on a deeper level. 

That’s the surface my chickens are running away, how do I solve the problem?

Kyle: When we ask people what their problem is they’ll give us a symptom not actually giving us the problem. 

We need to peel away the layers and this allows us to in everyday life work out things. 

We ask them why at each stage and we can do this with backyard chickens with every problem people come to us with.

Harms: If someone asked how do I stop my chickens flying away? 

The question is why is it important to you? 

What’s the real issue here? 

They may say so that the chickens are safe. 

Okay, but why is that important? 

Because I care for them and my kids have an emotional attachment to them, now we’re getting into a deeper problem. 

Somebody’s else’s answer could be because they cost so much money to raise or that’s my source of eggs, or that’s my source of whatever. 

In that case it’s food, security, emotional love, and care. 

That’s their real problem. 

Why this is great is if we can speak to the deeper problem we cut through even the noise of somebody solving the surface level problem because when they read it they’re like, if I can stop my kids from being really upset and mourning the loss of this chicken for example then my life will be a lot happier. 

So the flying away element is a symptom, that’s the thing that will happen. 

That’s the kind of question process you will go through yourself or with some kind of people who have this problem. 

That’s the kind of way to think about this.

Kyle: We can look at all the questions and do this ‘why process’ and if we find common threads that’s an extremely strong piece of information here. 

Now we know why people get backyard chickens.

Harms: Nail this deeper process and the first stage is okay you’ll still gain traction there. 

You’ll still be able to operate your business, but if we can get deeper it is an amazing place in terms of the information you’ve now gathered, you can talk directly to them as people within the marketplace, rather than just speaking to the marketplace. 

Nail this and you will genuinely know your market, so it’s amazing. 

What we’ve discussed is the fact that a business must create something of value, value to whom ultimately it’s the market, do they care about us yes or no? 

It is indifferent. 

We create value for the market by solving problems. 

We spoke about that and shifting the mindset. 

We also spoke about tools which can help you identify what problems the market has and we can delve into these problems which is amazingly important to us because it goes from a friend in the pub saying we’ve got a cracking idea to actually identifying people’s real problem that they search for. 

Because what people say and what people do are always two different things, and Google history and Google’s data they collect sadly doesn’t lie. 

This data driven approach is fantastic. 

Kyle: You should have now shortlisted three, four, five markets niche you’re interested in exploring. 

Now you need to head over to answer the public plug in the name of that niche again and keep it one or two words as short as possible. 

Answer The Public will display a report of all the questions being asked. 

Also, in order of the must frequently asked so you can start to get an idea of what the problems are within the market you are interested in serving.

Harms:  Once you know the problems, think of solutions.

What you have learned so far:

  • What is considered valuable?
  • How do we create something of value?
  • Become a problem solver
  • What problems do we decide to solve?
  • Accessing the world’s problems



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