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Going IT Alone: The Handbook for Freelance and Contract Software Developers
Going IT Alone: The Handbook for Freelance and Contract Software Developers

Going IT Alone: The Handbook for Freelance and Contract Software Developers: A detailed guide to self-employment for software and web developers - from identifying your target market, through to managing your time, finances, and client behavior

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Profile Icon Leon Brown
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Paperback Dec 2016 376 pages 1st Edition
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Arrow left icon
Profile Icon Leon Brown
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$43.99
Paperback Dec 2016 376 pages 1st Edition
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Paperback
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Renews at $19.99p/m
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Going IT Alone: The Handbook for Freelance and Contract Software Developers

Chapter 2. Positioning Yourself in the Market

Every industry has different groups of people you can sell to, with members of each group sharing characteristics and interests that define who they are. Being able to identify these groups will allow you to make your software, services, and marketing highly targeted to generate the type of reaction that you need to succeed.

Market segments


Whatever services and/or products your freelance business provides, you will most likely find that all clients are unique; there are characteristics shared by those who have a commonality, such as the industry they operate in, business structure, or any other factor. These shared characteristics are the ones that allow you to categorize your market into segments that identify the following:

  • The different client types you can target

  • The individual needs each client group

  • Parts of the market that have the capability to deliver to

  • The difference in profitability opportunities

These identifications and others help you to build the foundations for effective marketing and business strategy. By understanding the characteristics of the types of buyers in the market, you will be able to tailor what you offer and how you appear to match what you know appeals to them. This approach affects everything from product development and service delivery to marketing and managing your finances—simply...

Pricing yourself appropriately


A common mistake made by many new market entrants is the use of price as a selling point; with these entrants trying to undercut the competition and then falling into the trap of not being profitable enough to justify the effort, or even making a loss. Sun Tzu, a military strategist whose philosophy is studied by industry leaders, wrote:

 

"The general who wins a battle makes many calculations in his temple before the battle is fought."

 
 --Sun Tzu, The Art of War.

Like the generals who win on the battlefield, smart people fully evaluate the field they operate within and identify the position they hold before concluding the type of pricing strategy to use. Understanding the market environment in relation to your own attributes opens opportunities to identify to target your products and services at spaces occupied by little or no competition. Described thoroughly in the book Blue Ocean Strategy, these spaces in the market are opportunities for you to establish yourself...

Building quality for market segments


Quality is a factor that everyone would like, but its delivery is often restricted by skills, time, resources and budget. The definition of quality is something that changes between different groups of people; another reason to identify market segments that share characteristics. Whether the buying criteria is based on money, time or another factor, your ability to be successful with the market segment comes down to whether you are positioned to profitably deliver the quality that its buyers expect.

Meeting customer needs

The key to delivering the right quality to market segments lies in understanding their needs. Offering a product or service with high quality on all factors may result in you pricing yourself out of the market, whereas offering a version of your product or service that has selected features of interest tailored to be appealing to defined audiences will mean that you are able to make a better impression amongst those who you target as well...

Market research


Whether it is state run, a private sector operation, charity or social enterprise, cash is the blood flow of any organization; without it, the organization cannot function and will cease to exist. In the same way, an organization with no cash flow isn't able to function properly to meet its objectives. Whether you operate purely for profit or to benefit a community, your ability to identify what people want to buy and at what prices will dictate whether you succeed or fail.

Failing to plan is planning to fail

A common mistake made by new market entrants is to basing prices entirely on what people say they will pay rather than what it costs to deliver and be profitable. This approach is both lazy and naive, exposing their business to exploitation from market buyers, while at the same time increasing risks that limit their ability to deliver quality and make a profit.

 

"If ignorant both of your enemy and yourself, you are certain to be in peril."

 
 --Sun Tzu, The Art of War

The...

Summary


Understanding who you intend to sell to will allow you to clearly define what your business is about, who you intend to deal with, what you will offer, and how you plan to be profitable. The key to understanding your market is research, so make sure that you do this thoroughly and make use of reliable information sources.

Even when your research indicates a high demand for what you plan to offer, a clear focus should always be kept on whether your ideas are financially viable. All markets can be separated into multiple segments, categorizing buyers who share common characteristics. In terms of pricing, this often translates to the three general categories of budget, standard, and premium buyers; each needing to be tackled in a unique way to guarantee that your services or products can be delivered in a way that meets their quality expectations and is financially viable. It's important to identify what can be offered for the market segment(s) you target from the start so that you can...

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What you will learn

  • Identify and understand your target market. Propose the value of what your service or product offers. Build a business model that identifies key entities required to make your software business work. Develop marketing a marketing strategy that targets the right customer segments and produces the sales you need to be profitable. Analyze information to make better decisions and understand your business performance. Understand people through observation and use this to your advantage in project management and negotiation. Improve accuracy of estimates for time and costs of your software projects. Understand the relationship between code and the business strategy. Identify software features from a business perspective, allowing you to prioritise must have features from those that are less important to your profitability. Avoid the trap of increasing software development time and costs from features that provide no benefit or sales increase.
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Table of Contents

12 Chapters
Introducing Freelancing Chevron down icon Chevron up icon
Positioning Yourself in the Market Chevron down icon Chevron up icon
Defining Your Business Model Chevron down icon Chevron up icon
Creating a Brand Chevron down icon Chevron up icon
Networking, Marketing, and Sales Chevron down icon Chevron up icon
An Introduction to Client Types Chevron down icon Chevron up icon
Managing Clients Chevron down icon Chevron up icon
Negotiation Chevron down icon Chevron up icon
Software Development Resources, Patterns and Strategies Chevron down icon Chevron up icon
Software Development Methodology Chevron down icon Chevron up icon
Creating Quotes and Estimates Chevron down icon Chevron up icon
Project Management Chevron down icon Chevron up icon
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