[arrow keys to move - ESCAPE to exit]
Test Your Entrepreneurial Skills


Almost everyone comes up with one or two million
dollar ideas at least once during their life.
Unfortunately between the million dollar ideas are
dozens of flops. Whether it's luck or skill the true
entrepreneurs of the world seem to pick the
winners. What about you? Can you tell the mega-hits
from the mega-flops?

Consider This: In Texas and surrounding oil states
there are thousands and thousands of families who
receive oil and/or natural gas production royalty
income checks from producing wells drilled on family
property. Often the income, like the property, was
inherited and the recipients don't know much about
the well, the property, or the oil business.

From time to time there are stories in the
newspapers about royalty interest holders getting
cheated out of some of their rightful income by
shady petroleum companies. Also, oil and gas wells
give out over time so royalty income should
naturally decline.

Now, here we go. You believe there are a reasonable
number (from a marketing perspective) of royalty
holders who suspect they are being ripped off and
would spend about 30 dollars to test their
suspicions. It might be a real window of opportunity
without any known competition to drive down your
profits. As a geologist you know how to access
state records showing actual petroleum production
for leases your potential customers might have an
royalty ownership interest in. Your idea is to send
them copies of the lease's petroleum production
figures for 5 dollars per month (with a six month
minimum). That's 30 dollars.

You begin your business venture by placing ads in
the county-wide, local, weekly newspapers in the
sparsely populated, oil rich counties of West Texas.
You also run a much more expensive ad in the monthly
Texas Farm and Range Magazine which has a
circulation of about 140,000. The ads ask the reader
if he/she suspects they're being cheated out of
petroleum royalty income. It tells them that for as
little as 30 dollars they can find out for certain. It
asks them to send for a free brochure. Your
overhead costs are tiny: a few ads, membership in a
petroleum industry library, a few stamps, etc.


Question: This is the kind of project that could fall
into your lap. You decide, is this a good project and
will it make you money?

Answer: The wise entrepreneur would give this a
thumbs down. The newspaper ads actually produced a
few responses (well under a dozen). The magazine ad
resulted in exactly two requests for brochures.
None of the brochures mailed out resulted in any
incoming checks. Why?

Lessons Learned: (1) The target market, suspicious
royalty holders, was too scattered to be easily
targeted and approached via this type of marketing
(2) Perhaps the target market wasn't as large or as
worried as thought (3) No one else appeared to be
doing anything like this. It's safer to copy and
improve upon someone else's success than to try to
start one on your own. Maybe there's a good reason
why no one else is doing it! (4) Find a product or
service with an obviously larger customer base -
i.e. car owners, home owners, city dwellers, hungry
people, etc.

Well, did you pass the test? Is your money still safe
in the bank or did you spend it on empty
advertising?

                                           ###


-------------------------------------