Evan Carmichael advises someone launching a B2B sports class directory to first validate demand by interviewing academies about their pain points, then run a free beta with 5-10 schools. Set pricing only after proving value, choosing between subscription, commission-per-lead, or freemium models.
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Hi, I'm Evan Carmichael. Welcome to another edition of Ask Evan. In today's episode, I'm gonna answer a question from one of my forum readers who is trying to launch a sports directory, and he wants to know if it's a good idea and if he should charge a monthly fee for the service or not. So basically what the directory is is a listing of different sports classes that you can sign up for, and they'll show information about the school, maps, and basically try to be a lead generation service for these different sports academies. And he's wondering, you know, again, is it a good idea, and can he charge a monthly fee for it, and I guess how much as well. So in terms of is it a good idea, my recommendations for you is start talking to potential customers. So I drew this baseball here. What What I would do is start talking to these guys, right? Talk to the sports academies, see how they're doing it now. Do they do a lot of promotion online? Do they need a lot of help doing this or not? Is this a major pain for them or not, right? If you're trying to make money as an entrepreneur, you wanna attack somebody's pain, right? People will pay you money to get rid of their pain. So if there's a pain, if there's a big problem, then it's much easier to get money from companies. I like that it's targeting B2B, because if you can show a tangible benefit to them, then they're gonna use you for a long time, and they're only gonna increase the number of orders that they work with you through. But I would definitely make sure by talking to them to figure out, is there a pain or not? If they don't have a pain in this area, then on to a new company, right? On to a different business idea. So start talking about pain. Next, line up, you know, I'd say 5 to 10 of these guys and launch a beta version. So test it with them. Find out what information do you need from them to make it work, how can you integrate it into their website and their systems to make it work, and you'll find a whole bunch of other features that they need that you didn't think of at the start. And if you're not in that business, then it's hard for you to have everything planned out at the start. And even if you are in the business, it's still really hard. So the best way is to get feedback from your potential customers. So I definitely line up 5 to 10 guys, beta version, free, just get some feedback and make sure you can help them grow their business. From here, you'll figure out if there's a market or not for your service, right? If the beta users really like it and it's become an important part of their business, you gotta market. If the beta users aren't really using it, they're not getting a lot of business from it, they're not finding a lot of value, they stop answering emails, maybe not a market for you. And either, you know, rework to make sure you're actually addressing the pain, or again, onto a different business idea. So this test will give you a lot of ideas if you're gonna have an opportunity to sell or not. If you determine that you do have a market, so it does work, they like it, they find it important in their business, The next thing you ask about, can you charge a monthly fee? There's a different, couple different ways you can look at pricing on this one. Okay, the first, you have your monthly fee, so dollars per month, and that can work, it can be effective, but for startup business, it's often hard to do because you don't have a track record. But if you're a directory, you're trying to attract traffic to your website, you're new, you don't have a history, you don't have a whole bunch of traffic, you don't have all that momentum built up that another website with 10 years of being online might have. So it's hard to justify to somebody, hey, you know, pay us $300 a month or whatever you're gonna try to charge when you don't have a lot of traffic coming to your website, you don't have customers for them. So what I might wanna do is if you're gonna charge a fee, if it's monthly or annual fee, try to give them a guaranteed number, minimum number of customers. So what you're gonna be doing is tracking orders, right? You're having people who want to sign up for these classes book online through your system, so guarantee them a minimum number. So that puts you on the spot, you gotta deliver. But if you're not delivering, you know, they're gonna, they're gonna drop, but it's also not a good service, you know, that you're providing. So I would definitely try to put some kind of minimum number on here, especially at the start. A couple other ways you might be able to price this out is you could do a commission for every sale. So every time somebody signs up, they get— they have to pay you a commission for doing it, or for a lead. So it may not be signing up right away through your website, but it could be passing contact information, name, address, whatever it is, on to the school and you sell that lead. I would definitely look though at a freemium model, and I think this could work for your business. And basically freemium, what it means is You have something at a free base level, and then you should show so much value that they want to upgrade to the next package. So Evernote, Dropbox, some great examples of freemium models. So for a directory point of view, you can have everybody have a free basic listing, and that'll also help you with your SEO traffic because the more content you have up there, the better. Then what you need to figure out is how can you take those free guys and upsell them on the extra benefits package where they're gonna pay you either commission or they're gonna pay you a monthly fee or annual fee to be listed on your website. So that's where you'll figure out, you know, what are those pain points. By beta testing it, by figuring out your market, you'll know what the difference is between the free model and where people will actually pay. If you don't know the difference, then you're not ready to start talking about pricing yet. You gotta figure out these 3 steps first to really understand your market. So I hope that helps. That's what I would do. If you guys like the video, please give it a thumbs up below, and I'd also love to hear what you guys have to think if you want to leave a comment under the video. And stay tuned for next episode.
