The term TMA or Total Market Addressability is a metric marketing professionals rely upon to estimate the true market potential of a given value proposition. This number often hinges on the real number of dollars spent for a product service or other form of value creation in years past. The basic principle of the indicator is a measurement of how easy it is to reach people who will want what you are selling. Some sets are extremely addressable, for example people everywhere are easily converted to purchase the twenty niche cleaning services, bundled and otherwise as outlined in my book Cleaning for Profit.
But other audiences are extremely difficult to reach. These include people who whose need may carry a stigma such as a medical condition. This is why eye examinations are required to renew your driver’s license at the Department of Motor Vehicles. Some people simply are not ready to accept that their visual acuity has declined; therefore they have not acted on their own to resolve the matter until they are made to do so by authority.
Remember the Segway that battery operated two wheeled scooter? (Think Mall Cop) The company had extremely high expectations, it was suppose to replace the car. And it might have except people simply didn't care to buy the thing for themselves and so it has a dismal sales history.
Other times the need for a new product or service might be great, however people do not know what they don't know. Such an example from my own experience are the millions of people nowadays who think that they understand the legal jargon of a prescribed court form well enough to choose and fill one out on their own. This happens all too often in the age of the internet because forms are readily available to download and of course people are looking for the cheapest solution. Why not use the form since it seems to be written in English after all. Well laws are different in Milwaukee Wisconsin from Las Angeles California where the form may have been drafted. Sadly, another reality often overlooked is the fact that thedefinition of terms for legal jargon is quite different in Black’s Law Dictionary from its ordinary sense or Webster’s interpretation of the same word.
Moreover, legal requirements are constantly evolving and most often vary from one judicial jurisdiction to the next. What’s worse the situation is embarrassing for those who realize too late that they should have hired a lawyer or other legal professional. It becomes a sore topic and they may be unwilling to admit the truth (and especially unwilling to share that experience with others).
Addressability is a major factor when you are thinking about performing a SWOT Analysis for a new business offer. There is far less risk in marketing to a group of people who are primed and ready for what it is that you are offering. Example: Most people love pizza, many of us eat it frequently so it follows that the local serviceable market is likely going to be great for that product. Whether the market is adequately being met for quality, how one might stand out from the others, and market saturation for that space are some of the other soft factors considered in a feasibility study. The bottom line is that it is much more expensive to market to a TMA with low addressability than one with a high addressability.
As a side note my mention of one or more of my books in an article might be a turn off for some people. Of course I wish to market my own books. Wouldn't you? Still just like in any business my focus when writing an article is on creating win/win scenarios. The business articles are written to provide value to my readers, whether or not they chose to purchase one of my books.
Consider that the examples made in this piece are they suitable for the topic? I chose to highlight the cleaning industry because that was my humble beginnings, I actually had skin in that game, eventually owing the number one cleaning company in Mason County Michigan. (measured by sales not personal affection). The company was poised to go statewide when I sold it to an employee. I cannot tell you how many times I have read a how to book that was written by someone who has never done it. And when you have done a thing trust me you can quickly tell the difference.
One of my previous experiences included a successful window cleaning operation in the city proper of Las Vegas. This was accomplished on a bootstrapping upstart budget of only five thousand dollars (and of course a whole bunch of sweat equity). At that time the unemployment rate in Vegas was at 16% and I was coming in from out of state to do it! I also concurrently owned two flourishing pawnshops while I was doing this. Yes I am completely OCD for building companies! I simply love the challenge.
Of course my experience played a large part in that expedited success in an area I knew well, but the venture certainly would not have been possible had the cleaning service space been any less highly addressable. Of course that seemed obvious at the beginning but in those early years there was much inefficiency especially in marketing efforts. So the Las Vegas experience reflects what is possible when we apply the 80/20 rule knowing our market for the best results. (The entire story is in the book) Newsflash: Our success largely depends on ourreceptive customers. Cleaning can be general or highly specialized, something that almost anyone with commitment, gumption and attention to detail can do. But these business principles work for all types of companies and in my opinion are just as good as anything taught at Harvard or the Wharton school for that matter. In fact they are really one in the same. (Read the Harvard business series and find out for yourself. Start with "Financial Intelligence").
By comparison marketing a company in a space with low addressability is like trying to push a bus uphill. Unfortunately I have that experience to share as well. That is after spending a hard earned personal fortune gained in former business wins, on just such a pursuit. Taking the ultimate challenge: sold my gold mines (pawn shops) so that I could crusade for a greater cause; to address a solution to inequality for those who subsist at lower wage jobs or live on a fixed income; the mission was to provide an affordable alternative to competent legal help with LegalBee.
And this my gift to you: a thing you probably ought not do if your goal is wealth accumulation. Legal Services have a very low addressability. You really have to want to help others to get involved with family law or transaction law as a document assistant. Corporate law, as a lawyer, maybe. My wife Cherie is the lawyer, I am just her student.
The entire legal space is oversaturated and no one really cares to hear about it. I bet you are probably tired of hearing about it now. Investment wise LegalBee was financially about the worst decision I've made as an entrepreneur. On the other hand you will never find a quote of mine anywhere saying that someone will make a ton of money as a LegalBee. It simply isn't why you go into it. Low addressability is a close cousin to low repeatability. Similarly if you clients don't want or need your service or product very often customer acquisition costs rise.
Truth is I would not go down that road again. At great expense the LegalBee system is now built and it is a way forward for the right person.(With less addressability than a Segway) So I will say it once again, I would not choose to do it all over. It has been a hard lesson that willpower alone is simply not enough to overcome the rule of the market (going on five years) and as I approach my golden years it is certainly not a sunk cost I can afford to pay twice in my life. The real lesson in it all is facing the reality that my former "self made" wealth really had as much to do with the nuances of good markets as it did with my own capabilities and hard work. It is a sobering reality that we must pick our battles carefully. The lesson is to explore and know your market before you take the leap! Start with addressability.
So I decided to write the books and these posts about former wins in business What I had to say will really matter to less experienced entrepreneurs seeking direction. Right now I am involved in a startup in a totally new space, and I am not even the owner of the business, I am just the manager (with a small stake in the net profit of the operation). A chance to learn a new space and write about it, hello. Open just three months, our startup is already turning a profit! (we have great leaders and a wonderful team).
While my latest endeavor is not nearly as profitable as pawnbroking is, nonetheless I am once more active in an industry with extremely high addressability: Hospitality, people gotta sleep sometime. Why not make that experience great! I can't wait to share the particular lessons of this present experience with another book in due time. If I can help others to avoid the same risks and perhaps set them on a well paved road to success, well that has got to mean something.
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