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Ready, Fire, Aim" by Michael Masterson Exam 67 Questions with Verified Answers,100% CORRECT

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Ready, Fire, Aim" by Michael Masterson Exam 67 Questions with Verified Answers Masterson's four most important decisions in life - CORRECT ANSWER - What you do - Who you do it with - Where you do... it - When do you do it (when you work and when you don't) What are the 4 stages of growth in terms of revenue and number of employees? - CORRECT ANSWER 4 stages of growth 1. Infancy (0-1 mil, 7 people) 2. Childhood (1-2 mil, 49 people) 3. Adolescence (10-50 mil, 349 people) 4. Maturity (> 50 mil) What is infancy's main problem, challenge, and opportunity? - CORRECT ANSWER Main problem - Ignorance, you don't really know what you are doing Main Challenge - Making your first profitable sale Main opportunity - Achieving a minimum critical mass of qualified customers (CMQC) Describe infancy. - CORRECT ANSWER - These 7 employees become functional managers, and each gets a fuctional responsibility (sales, marketing, etc.) - Each one then hires others to fill their responsibilities. - Increasing production is the best way to spur growth What is childhood's main problem, challenge, opportunity? - CORRECT ANSWER Main problem - Only breaking even Main Challenge - Creating many additional, profitable projects quickly Main Opportunity - Increasing cash flow and becoming profitable Describe childhood - CORRECT ANSWER - The business is booming but it feels like it's about to explode (fast growth, but systems break down) - Problems are customer complaints and quality, due to managing the growth. Why do multiples of about 7 lead to different culture changes? - CORRECT ANSWER 7 is the smallest group size because this is the largest group that can effectively communicate as one coherent group. What are the 5 magic wands of business genius? - CORRECT ANSWER 5 magic wands of business genius (In order to have a $100 - $300 million enterprise, you must be great at): 1. Coming up with new, good, and useful product ideas 2. Selling those products profitably 3. Managing processes and procedures efficiently 4. Finding great employees 5. Getting shit done. In order to get people, procedures, products, and promotions going, businesses must be led by a person or people who are good at getting jobs done. To be a successful entrepreneur, what must you be able to correctly identify, and come up with? - CORRECT ANSWER To be a successful entrepreneur, you need to be able to correctly identify the most important problem, challenge, and opportunity you face at any given time. In addition, you need to be good at coming up with ideas, selling products, managing systems, developing superstars, and taking action. What should you start before anything else in Stage 1? - CORRECT ANSWER You need to start sales before anything else. How much of your time should be spent selling? - CORRECT ANSWER Every business is part the thing you do, and part selling. Most of your time should be sent selling, which is the real business you're in. You must be a truly effective salesperson to be a successful entrepreneur, and should spend 80% time selling, 20% on everything else. What are your primary, secondary, and tertiary concerns as a stage 1 business? - CORRECT ANSWER 1. Primary concern - Selling 2. Secondary Concern (not your focus until an effective sales pattern is created and proven): - Defining customer service standards 3. Tertiary concern (little or no time) - Making your business look and feel like a real business (image, accounting, operational, legal) How do you tell you have a good product? - CORRECT ANSWER For most industries, the product doesn't have to be perfect at first. You need to prove it's a good idea with customers, which will probably require iterating the product based on customer feedback. You cannot determine how good an idea is until you sell it, so sell it as soon as you can and develop the product through feedback. What 4 personalities must an entrepreneur have from the start, and in every stage? - CORRECT ANSWER 1. A seller 2. An improver - improve the product 3. An organizer - Make sure things work smoothly 4. A pusher - Someone to get people to do what they're supposed to do What should your priorities of these 4 personalities be in stage 1? - CORRECT ANSWER 1. Selling 2. Pushing 3. Improving 4. Organizing There is a direct relationship between a success of a business at any given time and... - CORRECT ANSWER There is a direct relationship between a success of a business at any given time and the percentage of its capital, temporal, and intellectual resources devoted to selling. True at anytime, but especially in beginning of a business. Why is making the first sale so critical? - CORRECT ANSWER 1. You need cash flow ASAP 2. You won't know if you're USP is good or bad until you test it in the market. The faster you test it the better. Instead of opening up a shop, how can you sell your product? - CORRECT ANSWER Instead of rent, you can sell things at flea markets, eBay and elsewhere online, existing retail shops, friends. This will teach you what merchandise you can sell and for what price, learn how to sell, and generate enough cash flow, which is critical for your business. If you do this for a year successfully, you will have enough experience to start a lease. This reduces the risk by proving uncertainties. You can't do this with all industries, but there is still a lot you can do early in other industries. What are the 4 secrets of the OSS (Optimum Selling Strategy)? - CORRECT ANSWER 1. Where are you going to find customers? 2. What product will you sell them first? 3. How much will you charge for it? 4. How can you convince them to buy? 1. Where are you going to find customers? - CORRECT ANSWER Question of location. What do they read, watch, how do they spend their time? In the beginning, do the industry norm, what everyone else is doing. Take note of advertising currently in the industry, how often they advertise, and for how much. The best locations for competitors should be the best locations for you too. 2. What product will you sell them first? - CORRECT ANSWER Need to be flexible about what to sell. If first product doesn't sell well, you need to try a new one. 3. How much will you charge for it? - CORRECT ANSWER - Major impact on sales, third only to media you sell it through and the product you sell. - Find out what the competition is doing and sell for about the same price. For every product, there is one optimal selling price that yields the highest profits. If you deviate significantly, you can greatly lose profits. 4. How can you convince them to buy? - CORRECT ANSWER Optimal selling strategy includes media you choose to advertise in, product you decide to sell, concept behind advertising, price you decide to sell at. It's your job to find the optimal strategy, and there is only one. What are the 5 steps for creating a product that can launch a business? - CORRECT ANSWER Find out what products are currently hits in the market - Look in places you've identified, what products are advertised the most? How long have they been hot for? You want to be in at the beginning of a trend. - Once you have identified the top 3-5 hot products in the market, study them, list features and benefits, list good features and shortcomings, every fault is an opportunity. This is a good time to share with friends. You are Looking for an idea that really excites you. Does yours fit that trend? If it does, you are good to go, if not Come up with me-too versions of several hot products Come up with features or benefits others lack Describe how discounting can be advantageous. - CORRECT ANSWER Discounting - You can sell more by discounting drastically from your competition. The quickest way to profitably gain new customers is to have one lead product sold at a heavy discount, then all other products sold normally. Discounts can you afford the discount though? Probably not if it's only product or you don't have heavy advantages elsewhere. What is the theory of market elasticity? - CORRECT ANSWER Indirect relationship between the price of a product and: Supply Consumer demand How do you determine the allowable acquisition cost? - CORRECT ANSWER 1. Determine lifetime gross profit of a customer - often through market research or just experience (if you can't find this, your customers on average spend 100-500% of their original purchase prove with you over time.) 2. Determine the customer's lifetime net value, take into account overhead, rent, etc. 3. Determine a reasonable profit, the general rule is at least 20% gross sales. 4. The result is the total lifetime acquisition cost. This can allow you to discount to bring in new customers (on average, assume 50-100% gross profit of what they spend on their first purchase). What is the difference between wants and needs? - CORRECT ANSWER Our needs are very simple, everything else are based on our wants, while our buying decisions are mainly based on our wants. You are in the want, not the needs business, so have to create want in your customers hearts, and this is not logical. You must stimulate emotions, emotions that help you sell your product, they need to think about how your product helps their lives, by exposing them to copy that subjects them to one or several benefits of your product. What is the difference between features and benefits? - CORRECT ANSWER Difference between features and benefits - Buying is not rational. For every feature, find as many related benefits to your customers, how does it specifically help them? You can go even deeper. Why would people want to sharpen pencils faster? Would the little things in life be easier so you can focus on what matters? Deconstruct the benefits to deeper benefits. You can ask the 5 whys, keep going. How do you establish a USP? - CORRECT ANSWER The single, most important benefits unique to your product. If you are bringing your new product to the existing market, make it better and make it seem better. You have to position it as different from and better than other products of its kind. You need a unique position and way to communicate it clearly and concisely. You have to emphasize that USP all the time so you dominate that part of the marketplace. The USP has to be a benefit the buyer. Take a good look at other products in the market and look for gaps in customer needs such as in faster service, better prices, superior quality, convenience, service, better guarantee, etc. You need to constantly update USP so it doesn't become stale. This is a continuous effort. What are the three aspects of a USP? - CORRECT ANSWER 1. Appearance of uniqueness 2. Usefulness 3. Conceptual simplicity. What are the 4 components of all effective sales efforts? - CORRECT ANSWER 1. The big idea - should come from the USP, but applies to the marketing promotion. Based on USP, but much bigger so you can sustain an advertising campaign. 2. The big promise - How the big idea improves your customer's life. 3. Specific claims - What exactly this can do to your customers. 4. Proof of those claims - Proof of people with these products or skills etc. What should you do to create your first advertising campaign? - CORRECT ANSWER - Make a list of every product feature - Make another list of every possible benefit these products can provide - Identify a new market trend that's just rising - What benefits can you tie into this trend? - What benefit can you make into the USP? - What USPs are the strongest? - For each strong USP, create a big idea, big promise, and claims and proof of claims - Get at least two advertisements written, each with different copy. Approach and test them - Take the version that works best and make the basis of all sales and efforts. How can you overcome the ignorance that comes with starting a business? - CORRECT ANSWER 1. Seminars, classes, books 2. Speaking personally with people in business and getting first-hand advice from them. When reaching out to peers and mentors, what should you do? - CORRECT ANSWER 1. Don't be afraid to ask questions, even obvious questions that show your ignorance. Don't pretend you have no weaknesses. 2. Have multiple mentors to get different perspectives. 3. Ask up, down, and sideways, including competitors and employees. Anyone who has something helpful to say. 4. Maintain relationship by being appreciative. Give thanks with personal note or gifts, like wine or cigars! 5. Make your own decisions and take responsibility for them. Review all advice, decisions are ultimately on you. Your solution may be a combo as a decision. When teaching employees, what should you do? - CORRECT ANSWER 1. Teach instinctively, or formerly if you don't have the instincts. If someone finds a useful secret, make a lesson of it 2. Don't make lessons one sided, ask everyone what you can learn from said event. Document these lessons with written memos that will become an informal memo. 3. Don't limit lessons to successes. Analyze mistakes in a positive productive way 4. Share lessons with everybody, don't hoard your secrets. What is the goal in stage 1? - CORRECT ANSWER The goal in stage 1 is to reach a critical mass of qualified customers (CMQC) - this is the number of loyal customers you need to make the enterprise viable. You must identify the CMQC, and can adjust prices and types of products to reach this. What numbers should you give your team to reach the CMQC? - CORRECT ANSWER Give your core team two numbers: a certain number of qualified customers acquired at a certain cost to the company. This is the point in which you reach critical mass. What should you have completed by the end of stage 1? - CORRECT ANSWER - Locate core market - Figured out best media to reach them - Determine best price for product - Determined USP tied USP into a big idea - Used the big idea to create compelling marketing copy - Tested all of these several times - You have determined the OSS, which is the most important thing to do as a stage 1 entrepreneur. To bring your startup to the highest level, you must... - CORRECT ANSWER - Recognize market changes - Welcome those changes - Encourage your employees to embrace the necessary changes - Retain the knowledge and skills you have acquired, because this will become useful later. Why does stage 1 growth slow? - CORRECT ANSWER Stage 1 growth slows down when you have exhausted the market. Sales will eventually slow, regardless of what tinkering you do with your products. The problem is usually that the lead product has finally exhausted itself; most people have bought it or decided not to. What can you do to speed up growth at the beginning of stage 1? - CORRECT ANSWER Sales are slowing, so you need an aggressive proliferation of new products that leads to fast growth. More new products is your greatest opportunity at stage 2. The faster you can develop and sell those new products, the faster you will grow. Define front-end and back-end marketing. - CORRECT ANSWER - Front - Sales come from new prospects, the purpose is to acquire new customers. The goal of the OSS is to find as many new customers for as cheaply as you can. You must be willing to just break even, or even take a loss here. - Back - Sales come from existing customers, and the propose is to gain a profit. This is very easy, and just requires telling your customers about a new product and give them any incentive to buy, just be consistent with products and pitch. Describe the tipping point. - CORRECT ANSWER Minor variations are formed by other innovators, and at some point, the wave of innovation will tip, and there will be a sudden overflow of movement in the new direction. Consumers aren't looking for new products, but clever adaptations of products they already know. 80% old, 20% new. Don't develop brand new ideas, but notice trends and develop products just in front of that trend. Creating products are about trial and error. When competitors create knock-offs of your products, what should you do to combat it? - CORRECT ANSWER When other people knock you off, anticipate it and create a new and better version when you know they are about to copy. What is the principle of one-step removed? - CORRECT ANSWER The more steps away from what you do and know how to do, the greater risk and lower your chance of success. Take calculated risks, and only move one step away. What are 3 fundamental marketing facts? - CORRECT ANSWER 1. The secret to breaking into new markets is tipping point products 2. The key to make tipping point products is to find hot products and tinker with them. 3. You only tipping point products in the front-end, not the back-end. Is first always better? - CORRECT ANSWER First isn't always better, aim at trending upward. How should you come up with new product ideas? - CORRECT ANSWER How do you come up with product ideas? Work with creative teams, don't be a solo creator. This team should be a minimum of 3 people, and a limit of 6-7. Don't give too much time for product creation, because of Parkinson's Law. Have high standards and push past ordinary ideas. Everyone must contribute, not just the marketers. Be willing to control the conversation. What is the cube of product development? Why is it useful? - CORRECT ANSWER This is useful as a planning tool and can show you all the different products you can create. 1. Price 2. Product 3. USP What should you do to remember important marketing ideas? - CORRECT ANSWER In order to remember great marketing ideas, you should deliver both a model that resembles a product idea and a headline and lead for a promotion that might sell it, at the initial meeting. Then write a short advertising piece within a day. Time is your enemy. What is the formula of growth related to innovation and velocity? - CORRECT ANSWER 80% G = I V2 Innovation Velocity Second stage growth To succeed at product development, you must: - CORRECT ANSWER 1. Love good ideas from anywhere 2. Hate sluggishness 3. Love the entire process How can you turn failure into a good thing? - CORRECT ANSWER Accelerate failure and become more efficient over time by learning from those mistakes. Publicize failures and document them in company files. As long as you take advantage of mistakes, failure is OK. Do whatever makes sense, but just do it quickly. When are instincts a good thing? How can you develop good instincts? - CORRECT ANSWER Instincts of the experienced are based on thousands or tens of thousands of experiences, not that which can be calculated on a spreadsheet. To develop great instincts, assess every business deal and outcome objectively. Ask others for opinions. What worked and what didn't? Resist the urge to make yourself right after the fact. Your instinct will inevitably get better. What questions must you answer before knowing a product is ready for market? - CORRECT ANSWER Is the product good? How is it good? Define good. Does the market need it? Unless your product can sell a certain minimum amount, it cannot be good. A good product provides a big and clearly communicable benefit to the customer What are the 2 reasons why great business ideas don't get past the development stage? - CORRECT ANSWER 1. Perfectionism - You have to be willing to make mistakes in order to be action-oriented. Getting things going quickly is more important than planning them perfectly. There is plenty of time to perfect it later if you're selling it well now. 2. Chores (making excuses) - Taking action is one of the biggest parts of success. Be willing to fire when the time is right to fire. Taking care of chores is your way of procrastinating, which is a troublesome emotional hurdle. What is incremental degradation? - CORRECT ANSWER product quality is the sum total of many factors, most of which when measured, aren't even noticeable. Like a candy bar with 38 different ingredients. You should still make cost cutting procedures, but do split tests, and do them objectively, although you still can't measure the long term effect of lowering quality of the product. If a product isn't selling well should you try and fix it? What if a product is selling well? - CORRECT ANSWER If it ain't broke, fix it. If it's not selling well, it's probably impossible to improve it enough, so just drop it and come up with something significantly different. Improve top selling products, then medium ones. You should make improvements as often as you can. Make small, incremental changes, shy away from radical moves to good products. Make product improvements open to customers. The product goal is constant, never ending improvements because the business goal is constant, never ending sales. What is the golden rule of selling? - CORRECT ANSWER Treat your customers the way you want to be treated. What are commodities? What is discretionary? - CORRECT ANSWER Things we buy because we need them are called commodities. The problem is that there's always enormous pressure to lower prices, and consumers can go virtually anywhere to get the best price. Discretionary selling is selling to desire, and is unlimited with profits. What 3 ways can you increase revenues? - CORRECT ANSWER 1. Sell products to more people 2. Get customers to buy more products from you (Back-end). 3. Charge more for products you already sell. This will change your business in a very fundamental way, so you may want a new line. At stage 2, you have to implement all 3 in order to grow revenues from $1 - $10 million. What will always be the base of qualified customers? - CORRECT ANSWER Increasing the base of qualified customers will always be the company's biggest challenge. What types of sales does customer service grow? - CORRECT ANSWER Customer service grows back end sales the fastest. This just involves knowing what your customers really want (like holes vs. drilling), finding out how you can do that for them, and talking to them about what you are happy to do (one of the most profitable things you can do is collect info with a monthly newsletter). What is the 80/20 Principle in business? Should this change the way you sell? How? - CORRECT ANSWER A small share of customers are getting you the lion's share of the business. Are you talking to them separately? Are you targeting big spenders? Are customers who need a product the most the ones who are most likely to buy? - CORRECT ANSWER The less a customer needs a product the more likely he is to buy it and vice versa, not true for every commercial transaction though. Summary - Know the following: - Stage 2 starts when the first product success ends, when the sales slow, things will change. - Make sure employees understand selling before the end of stage 1. - Innovation and speed is essential for stage 2 - Organize the business to deal with both front and back end. - Focus marketing on desires - Tipping point marketing - Understand four legged marketing cube - Become an expert at assessing success - Determine a constant cycle for innovating existing products - 3 ways to increase profits - Golden rule of marketing - Understand the Ready, Fire, Aim for any approach - CORRECT ANSWER [Show More]

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CQM-C EXAM (27 Sets) Questions with Verified Answers,100% CORRECT

CQM-C Exam 40 Questions with Verified Answers,CMQ/OE Exam Terms 2017/2018|101 Questions with Verified Answers,ASQ CMQ/OE 34 Questions with Verified Answers,Ready, Fire, Aim" by Michael Masterson Exam...

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