The Personal MBA

Master the Art of Business

A world-class business education in a single volume. Learn the universal principles behind every successful business, then use these ideas to make more money, get more done, and have more fun in your life and work.

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What Are 'Alternatives'?

As you develop your offer, you have to choose between the competing Alternatives.

You should appreciate the Alternatives your customers face to decide what to include and what to leave out.

Once you know the options, you can examine the combination that would make the most attractive offer.

Josh Kaufman Explains 'Alternatives'

It's Friday night. You're hungry, and you're thinking about going out to eat. You've already decided that you value having food prepared for you enough to justify the extra expense. Where should you go for dinner?

If you go to the neighborhood diner, you'll have access to a large variety of decent food at a reasonable price. The place may not be very fancy, but you know you'll be served a pretty good meal quickly and without a lot of fuss or expense.

If you go to a swanky hot spot, you'll be treated to an attractive decor and sophisticated cuisine. You'll have an impressive story to tell your friends, as well as the anticipation and excitement of a big night on the town. You'll also have a heftier tab.

Unless you're really hungry, you won't patronize both restaurants on the same evening-it's an either/or decision. At the same time, there's no "right" decision-in fact, you may choose to go to the diner one evening, and the trendy restaurant the next. It all depends on what you value most at the moment you decide where to eat.

Now let's flip the situation. You're the owner of the diner, and you're looking for ways to serve your customers better and bring new people into the restaurant. What should you focus on improving? Would expanding your entrée selection, making your cook staff more efficient, or remodeling the restaurant make the biggest difference to the bottom line?

In a perfect world, it would be best to do all of these things, but business has been lackluster recently, and you don't have an unlimited budget to work with. You know you need to do something, but it's not clear which improvements-if any-would make the cash register ring more often. What do you do?

As you develop your offering, you can't avoid making choices between competing Alternatives. Should you add a particular feature, or not? Should you optimize for market A, market B, or attempt to please both? If you invest more in the offering, will your customers be willing to pay more to defray the expense?

Examining the possible Alternatives and considering the customer's perspective results in better choices. As you make decisions about what to include and what to leave out, it's essential to appreciate the Alternatives that your potential customers face when they decide whether or not to purchase your offering. Once you're aware of the options, you can examine the combinations and permutations of those alternatives to present an attractive offer.

Questions About 'Alternatives'


"Any business can buy incremental unit sales at a negative profit margin, but it's simpler to stand on the corner handing out $20 bills until you go broke."

Morris Rosenthal, author of Print-on-Demand Book Publishing and blogger at fonerbooks.com


From Chapter 1:

Value Creation


https://personalmba.com/alternatives/



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The Personal MBA

Master the Art of Business

A world-class business education in a single volume. Learn the universal principles behind every successful business, then use these ideas to make more money, get more done, and have more fun in your life and work.

Buy the book:


About Josh Kaufman

Josh Kaufman is an acclaimed business, learning, and skill acquisition expert. He is the author of two international bestsellers: The Personal MBA and The First 20 Hours. Josh's research and writing have helped millions of people worldwide learn the fundamentals of modern business.

More about Josh Kaufman →