Founders often tell me, “How can we be big unless we sell to everyone?” I call this the Target Market Trap.
It’s where most startups get stuck on their way to achieving their big dreams.
Here’s one way I help ambitious entrepreneurs clearly see how narrow focus will help you grow faster, not slower.
I ask them, “Have you gone to a sold-out concert with crazy ticket prices in a big stadium for a musician or group lately?”
They have told me about sold-out concerts from Metallica, Garth Brooks, Adele, Grateful Dead, Foo Fighters, Michael Bublé, and many others.
Taylor Swift is a good recent example. Her tour announcement this month was so popular that it blew up Ticketmaster servers with billions of ticket requests in the first hour.
Crazy ticket prices, sold out stadiums for multiple nights, and long lines. Social media posts from your friends who were there.
These are all signs of a successful business at scale, right?
But chances are you don’t even like most or all of those artists I mentioned. Maybe you even hate a few of them.
Taylor Swift isn’t trying to serve and sell to “everyone who listens to music” or even “all pop music fans.”
Yet she can sell out stadiums and sell millions of digital albums even when 90% of music listeners ignore her completely.
Taylor Swift fills stadiums because she is FANATICALLY LASER-FOCUSED ON HER TRUE FANS WHO LOVE-LOVE-LOVE HER MUSIC AND HER BRAND.
I couldn’t name a Taylor Swift song. Or a Metallica song. But they sell out stadium after stadium when they go on tour.
Let’s do the math for Metallica:
- Maybe 10% of all rock music listeners are heavy metal fans.
- Maybe 10% of hard rock fans who know about Metallica have actually paid for their music.
- 10% of Metallica music buyers might pay for a concert ticket to see them.
- 10% of those will pay $500 night after night to see them in different cities.
Filled up stadiums, happy fans, and huge revenues while staying focused on a subset of a subset of the “potential” market.
10% of 10% of 10% of your “TAM” (your Total Available pipedream Market”) is where your great and growing business is when you are growing up. And when you are Taylor Swift.
Don’t focus on 100% of your potential-maybe big market. You won’t be great for anybody.
Focus on the 10% of the 10% of your serious market where you can be amazing and get your customers to gladly pay you and then tell their friends about it.
How can Taylor Swift be so successful when I don’t even know anyone that wants to go to her concert?
Can you hear how silly that sounds?
Growth and acceleration are not about appealing to big and diverse audiences.
It’s about narrowing your focus to be KNOWN AS THE BEST AT SOMETHING IMPORTANT FOR SOMEONE SPECIFIC.
Show me a packed stadium with happy fans and I’ll show you a musician that ignores 90% of their “big potential market” to focus on their real fans and customers.
Specialists Eat Generalists.
#practicalfounders
