Archives for April 2011

Web-based Sales Platforms – Part 3

First, let me say that this picture of the Prince William and his new bride has absolutely nothing to do with today’s blog post on web-based sales platforms. Although having been awoken at 3 AM to watch the ceremony live, I probably look and feel like the little girl on the left; cranky, tired and a little out of sorts!

On Wednesday, I discussed Groupon, the largest and most popular “deal of the day” company. Like eBay, Groupon also has its detractors. If the economics or mechanics of Groupon simply do not work for your business, you are not alone. However, you may have cost effective alternatives readily available. Groupon is quickly gaining new competition. An article in the April 25, 2011 edition of Forbes Focus by Brendan Coffey estimated Groupon has 425 “me-too” competitors, and suggested that future competition may include Facebook and Google. Groupon rejected a $6 billion buy-out offer from Google in December of 2010.

While I have not evaluated specific vendors, here are several options you may wish to explore on your own.

  • Some cities and regions are creating websites to distribute coupons and advertise specials to promote local businesses, and typically at a lower net cost than the big-name national sites. I was pleased to see several such sites advertise on television during a visit to the Central Coast region of California. As an example, look at www.slocoupons.com. It promotes commerce in San Luis Obispo County. Search the Internet and ask your network contacts for comparable programs in your area.
  • Socialdish.com is scheduled to launch in March 2011, so its ultimate success has yet to be determined as of this writing. However, what makes it worth watching is that it is structured as a multilevel marketing program. It will distribute 30% of its fees through 10 levels of “downlines” as people recruit their friends and family. The limited information available at this time indicates Socialdish’s charges to advertisers will be less than Groupon.
  • LivingSocial.com is another “deal-of-the-day” type competitor to Groupon. This company was partially financed by the online retail juggernaut Amazon.

On Monday, I will discuss several more Internet websites that allow you to promote your services or locate potential clients at little or no cost.

In the meantime, best wishes to the Royal couple. If you are ever in North Texas, stop over. We’ll throw some red meat on the grill and I’ll tell you all about the War of 1812. And if you have any questions on marketing, I can tackle those too. Kate, I understand you family runs a small business. Who handles your finances?

Web-based Sales Platforms – Groupon

Today I continue the discussion of web-based sales platforms as low-cost marketing opportunities. I introduced this topic on Monday with a short post about eBay. While eBay has become phenomenally successful, it does have its detractors. Fortunately for today’s small business owner, it now has a wide variety of competition to accommodate your marketing efforts.

National websites that distribute coupons and advertise specials are interesting and growing promotional vehicles. Perhaps the best know of these so-called “deal of the day” enterprises is Groupon. It was the subject of an August 30, 2010 Forbes Magazine article called Meet the Fastest Growing Company Ever by Christopher Steiner. Its name is a play on the words “group” and “coupon,” a misnomer since customers purchase discounted vouchers, not coupons. If your specified minimum number of customers is achieved, you are paid immediately. It costs nothing unless the offer is completed.

Groupon’s compensation is a healthy portion of the offering proceeds, plus credit card fees. Customer discounts of at least 50% seem to be the norm. Groupon is therefore a viable platform to distribute gift cards and to introduce customers to high margin products or services, especially where additional full-price sales are anticipated during the initial or repeat sales.

  • The most obvious risk of incorporating Groupon into your marketing plan is attracting customers who will only buy at a substantial discount. If your Groupon pricing strategy is contingent on support from full-price repeat sales, this venue could become a textbook example of a strategy that increases sales while decreasing net income. Monitor results closely and be prepared to run away if necessary.
  • Another possible concern is that your promotion will be announced as part of a daily email distribution scheduled by Groupon; you have no control over its timing.
  • Finally, it is possible to become a victim of your own success with Groupon if you do not place an upper limit on how many discount vouchers you are willing to sell. This can happen in at least two ways. First, if your offer is attractive enough, placing limits on it (experiment as you would with any new promotion) will avoid the risk of having more customers than you can accommodate. A line of unhappy customer wannbes standing outside your store with Groupon vouchers in hand is not good public relations. Secondly, you are likely to lose money on every Groupon sale. For example, a $100 gift card offered for $50 will only generate about $23 in your pocket. Further assume the cost of providing that $100 of goods or service is $80. You will therefore lose about $57 on every Groupon voucher. Know your numbers and factor the expected gross loss into your marketing budget.

On Friday, I will discuss several “deal of the day” alternatives to Groupon.

Web-based Sales Platforms

This week I will continue with the general topic of Internet-based marketing opportunities for small businesses. Specifically, I will discuss web-based sales platforms as a low-cost marketing tool. I begin that discussion today with a short post about eBay.

There is nothing new or cutting edge about suggesting eBay as a sales platform. The world’s most popular online auction website has been around since late 1995 when founder Pierre Omidyar sold a broken laser pointer for $14.83. In all fairness, he later sold a Gulfstream jet for $4.9 million. According to eBay’s website, gross merchandise volume for 2009 approached $60 billion thanks to 90 million users and numerous specialty websites. Retailers can use individual listings or eBay stores. They can offer products using traditional auctions, fixed prices or fixed prices with best-offer options.

To be sure, eBay has its detractors. However, depending on the nature of your products and operations, there may be a place for eBay in your marketing strategy.

  • Analyze and define your eBay marketing strategy through a little homework and some low-cost experimentation. Why not list a few items and see what happens?
  • If eBay becomes a significant part of your marketing efforts, consider the impact of your Internet pricing strategy on existing “brick and mortar” sales. You will have to balance the added cost of shipping against the marketing risk of under-pricing online products relative to what customers are charged in your physical location.

On Wednesday, I will discuss a growing phenomenon known as Groupon, including several potential pitfalls associated with it.

Internet Marketing for Small Business-Part 5

On Monday, I introduced the topic of email as a low-cost marketing tool. Here are a few final points that apply to your evaluation and implementation of both email marketing and survey campaigns:

You will be surprised how few people open your email. ConstantContact tracks “open rates” by about 30 industry categories. Marketing and PR firms (who should be able to achieve stellar results) are 13%. The highest category is only 27%. It is a numbers game, so do not get discouraged. Above all, do not confuse activity with results in your accountability evaluation. A 100% open rate is worthless unless it generates sales, develops new leads or gathers useful marketing data.

Two other valuable statistics are your bounce rate (percentage of undeliverable emails) and your clickthrough rate (percentage of recipients who visit your website from the email link). The first shows how current and accurate your email lists are. The second provides a measure of the effectiveness of your online campaign. Compare both rates to industry averages as published by ConstantContact or one of the other vendors.

Consider the typical schedule and workload of your intended audience. Emails and surveys sent to accountants on April 14 or to retailers the week before Christmas are not going to achieve acceptable response rates.

Ralph Waldo Emerson said, “All life is an experiment. The more experiments you make the better.” Apply his philosophy by scheduling mailings on different days of the week and different times of the day. Never schedule a mailing immediately before or after a holiday. It will be deleted in the rush to leave early or buried in an avalanche of emails that piled up over the long weekend.

Also, experiment with the frequency of distributions. Depending on how you use email, you may decide to do weekly or monthly mailings. Get into a regular routine. Victoria’s Secret sends daily emails. My wife finds this excessive, presumptuous and annoying. I might be forced to unsubscribe if they do not slow down. Then again, maybe not. It is all about content.

Many recipients make snap decisions whether to open or delete an email based solely on its subject line. Choose something inviting that suggests a reason to read it. Titles in the form of questions, “how to” advice or lists (for example, Five Ways to Increase Your Sales) are usually effective.

Finally, always have someone proofread every communication before issuing it.

Have a great Easter weekend, I will be right here on Monday with a new topic to help you achieve Highly Visible Marketing. Best wishes until then.

Internet Marketing for Small Business-Part 4

On Monday, I introduced email-based survey programs as a low-cost marketing tool. Surveys can offer feedback from current and former customers, or an entire market. They can also provide market intelligence on your competition and industry.

While a complete outline of a survey program is well beyond the intended scope of this book, here are a few quick points you should keep in mind:

  • Begin your survey with a clearly defined plan. What do you hope to learn, what questions will help you gather the information necessary to achieve your goals, and what actions will you take because of the information gathered?
  • Make questions clear, precise and short. Each should address only one area or piece of information. For example, responses may be ambiguous if participants are asked about price and service in the same question.
  • Close-ended questions (where the respondent selects from a limited number of specified answers) are easier to analyze. Open-ended questions provide more qualitative information. Consider a combination of both types of questions.
  • Being constantly patted on the back accomplishes little, other than eventually wearing out the fabric on your shoulder. In business, it is far more valuable to receive an honest assessment of what you are doing wrong. Therefore, be willing to accept and act on the results of your survey, warts and all. Nevertheless, a press release may be in order if a favorable outcome justifies it.
  • Ask how likely the respondent is to do business with you again and how likely they are to recommend you to someone else. If either answer is no, determine why.
  • Construct surveys so they take no more than 10 minutes to complete.
  • Offer an incentive (like a 20% coupon) for those who give you the 10 minutes.
  • If you decide to incorporate the U.S. Postal Service to survey customers without Internet access, include a postage-paid return envelope. Your response percentage will be abysmal without one.

On Friday, I will discuss a few final points that apply to your evaluation and implementation of both email marketing and survey campaigns. Best wishes until then.

Internet Marketing for Small Business-Part 3

Last week, I began a discussion of email marketing and surveys as marketing tools for your business. I continue with that same topic today with some simple suggestions to command more attention with your advertising campaigns. Consider the following ideas when developing your marketing plan.

Email marketing commands far more attention if it includes special offers, coupons or discounts. For example, there is a colorful gourmet restaurant near my home. It has been featured on the Food Network’s television show Diners, Drive-ins and Dives with Guy Fieri. Friends and customers are treated to a coupon for a free serving of the restaurant’s signature dessert when they opt-in to the mailing list. They then receive a monthly newsletter that promotes new menu items, shares recipes, and so on. It always includes a coupon for a free dessert, 10% off an entree or a similar enticement. Their website and newsletters promote their Facebook page, Twitter account, blog and numerous YouTube videos. Visit www.chefpointcafe.org to see this outstanding example of an integrated Internet and social media marketing campaign. While I cannot comment on its financial success, I will tell you if you happen to be near Watauga, Texas around mealtime, stop in. However, plan on waiting in a long line.

  • Study emails you receive and think about what makes them appealing or ineffective. It is always cheaper to learn from someone else’s mistakes than to make them yourself!

Online or email surveys are such a flexible and valuable marketing tool that it is difficult to structure an argument not to conduct them on a regular basis. Most of the vendors listed on Friday offer survey capabilities, as do a myriad of other Internet vendors (see www.SurveyMonkey.com as an example). Several of the social media platforms discussed in Chapter 7 also offer free tools for simple surveys. Begin to explore these options by Goggling “Twitter survey tools.” Given the wide variety of competing vendors, there is probably no reason to spend more than $300 a year for even the largest of survey programs.

Surveys can offer feedback from current and former customers, or an entire market. They can also provide market intelligence on your competition and industry. Surveys monitor customer perceptions of your entire value proposition, namely your products, services and prices. They can also help uncover aspects of your value proposition that customers are unaware of, or perhaps undervalue relative to your costs.

While a complete outline of a survey program is well beyond the intended scope of this book, on Wednesday I will discuss a few quick points you should keep in mind.

Internet Marketing for Small Business-Part 2

On Wednesday, I began a discussion of email marketing and surveys as marketing tools for your business. Through this book, I have stressed low-cost experimentation as a means to fine-tune your marketing strategies without sabotaging your bottom line. Email marketing and survey programs are the perfect opportunity to apply that principle.

A prerequisite for email campaigns is a sufficiently large mailing list. Offer an incentive to prospects willing to opt-in or join your mailing list. We have all jotted down invalid information to escape the clutches of a pushy sales person. Therefore, do not hand out coupons or gifts on the spot; mail or email them. That way invalid data costs nothing.

Once you have established a customer and prospect database, it is time to consider an email marketing campaign through a vendor like:

  • BenchmarkEmail
  • Campaigner
  • ConstantContact
  • iContact
  • MailChimp
  • Pinpointe
  • VerticalResponse

Several of these already low-cost vendors are actually free, depending on the size of your mailing list and the number of monthly emails. Many also offer a free trial period. All the services allow you to download and manage email lists, and to create professional looking newsletters and other documents. They give recipients the ability to click through to your website for more information, and to forward emails to others. If they like what they see, their network then has the opportunity to opt-in to your mailing list. Email marketing services also offer the ability to promote, manage and even collect registration fees for event-based marketing ideas as previously discussed in this series. Keep the following points in mind in your analysis and planning process:

  • Structure email campaigns so you can track actual sales and new leads. There are several ways to accomplish this. One is to offer unique promotions or promotional codes in each communication channel. Another is to require customers to print the email promotion and present it in person to redeem it.
  • Prices for email marketing services vary. They can be based on fixed monthly fees, sliding scales depending on the size of your mailing list, or a fixed charge per email. Several vendors offer limited free trials. Shop around and speak with your network contacts to find the one that best fits your needs and budget.
  • Perhaps most importantly, email marketing vendors help ensure compliance with the Federal Trade Commission’s Controlling the Assault of Non-Solicited Pornography and Marketing Act (CAN-SPAM) of 2003. This is the federal standard for commercial email.

I will continue this discussion next week, starting with some simple suggestions to command more attention with your email advertising campaigns. Enjoy the weekend and I hope to have you back here early Monday morning.

Internet Marketing for Small Business-Part 1

Businesses have long used the Internet as a one-way communication channel to inform and educate customers about their products, prices, locations and hours. One-way communication is no longer sufficient, even for small businesses.

Here are some ideas to expand the traditional and limited marketing role of the Internet for your business without exceeding your budget limitations.

To increase sales and improve service, businesses should offer interactive capabilities for customers to place orders, make inquiries, request bids, and download product catalogs and service manuals. Many businesses now use the Internet to allow patients and clients to book or change their own appointments. It can be a very useful tool to help reduce lost revenue by sending an email or text message to confirm scheduled appointments. Online customer access need not be a cost prohibitive luxury viable only for “big box” retailers and national catalog companies. Multiple studies confirm it is a necessity for many types of small businesses. For example:

  • In an October 18, 2010 article titled A Cheery Holiday Forecast, Thad Rueter of the Internet Retailer reported on the results of a survey by The National Retail Federation. The survey found 44% of consumers ages 18 and above planned to shop online during the 2010 Christmas season. Of consumers who earned at least $50,000, 55% would shop online. Perhaps more telling of emerging trends, 27% of U.S. consumers who own a smartphone were expected to use it to research and buy products.
  • An article titled 8 Ways Fullservice Operators Can Build Sales was published by the National Restaurant Association in their 2010 Restaurant Industry Outlook Forecast. It reported that 41% of consumers sur­veyed said they choose new restaurants because of e-mail promotions. Close to 30% said they would likely opt to receive e-mail notification of daily specials. Another 56% visit restaurant websites, 54% view restaurant menus, 54% use the Internet to learn about restaurants they have not patronized while 25% have made reservations online.

If your business uses or is considering using gift cards, look at Panera Bread and McAlister’s Deli websites. Both offer the ability to sell, recharge and check card balances online, a real customer convenience. Providing printable coupons online is an even easier customer benefit you can offer.

On Friday, I will discuss email marketing and surveys as a marketing tool for your business.

Word of Mouth Has Gone Global-Part 7

I conclude this seven-part discussion of social media marketing today with just a few closing thoughts. First, having gone through the effort to develop content, create a social media marketing program and build a following, do not fail to promote Twitter, Facebook etc. on outgoing email signatures, business cards, letterhead, websites, and promotional materials.

Every media platform should be used to promote all the others. For example, you should occasionally send a tweet inviting followers to “Like” your Facebook Fan page, and use Facebook and Twitter to announce new posts on your blog.

Provide a direct link to your blog and social media platforms whenever possible. For example, my outgoing email signature ends with, “Please click on the links below to read our blog or to follow us on Facebook & Twitter.”

This series presented many new challenges for the already overworked small businessperson. Let me end with one more. Future Vision Web Services made this observation: “Most of today’s market leaders are those companies who had the foresight to recognize the changing landscape in today’s modern business world. The new business battleground has been very cruel to those companies that have fallen behind the curve.”

Do not allow the rapidly evolving landscape of social media marketing keep you from realizing the full potential of your business.

See you again on Wednesday.

Word-of-Mouth Has Gone Global-Part 6

Even if you use outside assistance to design and develop your social media platforms, generating fresh content remains your responsibility. Quite simply, no one knows more about your business than you do. Demonstrate that fact by sharing the body of material you accumulated in becoming a recognized expert. However, resist the temptation to share it all at once. Building a following in cyberspace is a marathon, not a sprint. As with blogging, develop a consistent conversational style and reporting pattern.

Here are a few pointers to get the most social media mileage out of your content and maximize its effectiveness:

  • If you have a document with multiple bullet points, break each into a separate post.
  • End each post by briefly telling readers what to expect in your next entry, and when it will be published.
  • Most content can be reformatted and repurposed as appropriate. For example, press releases and articles can be posted on Facebook and other sites as well as your blog. A 1,200-word article can provide a lot of content at 140 characters per tweet. Facebook status update fields have a 420-character limit. LinkedIn has a 700-character limit. Other social networks each have similar limits. With a little practice, you will probably find, as I did, that communicating your message within those limits is usually quite easy to accomplish.
  • You can supplement your original content with relevant quotes and articles written by others, or simply pass along helpful advice and suggestions you come across in your daily business. Numerous websites provide extensive quotes on every business subject. One example is www.brainyquote.com.
  • Timely material can be re-circulated or retweeted periodically.
  • Unless supporting a particular point of view is a deliberate part of your branding and marketing strategy, avoid expressing religious and political opinions or supporting controversial agendas that might alienate potential customers.
  • Have several people proofread and review your content. Check your pride of authorship at the door. Do not be afraid to use someone who will look you in the eye and tell you if you have “an ugly baby.” My son’s unbridled desire to correct his father makes him an extremely effective proofreader. Another friend’s frank comments often bruise my ego. I typically stew about them for a day, and then incorporate most of his suggestions.
  • No one cares about trivial matters like what you ate for dinner unless of course you are a food critic or Kim Kardashian. Maintain an air of business decorum and professionalism in your social media platforms.
  • There are numerous social networking tools available free online to help you monitor and simultaneously update multiple sites such as Twitter, Facebook and LinkedIn. Those tools currently include Tweetdeck, Hootsuite and Ping.fm. Most also provide upgraded versions for a fee. It is a truism of any free-market system that whenever a product or service becomes an undifferentiated commodity, those offering it can only compete on price. It is inevitable in the fast-paced world of social media that as soon as someone develops a new Internet-based service, someone else will figure out how to make money by offering it free. Therefore, periodically ask your social media active friends and network contacts whether they are aware of any new tools.
  • Finally, the ultimate purpose of social media marketing is to build business relationships. All relationships require two-way communication. Do not get so consumed in posting content that you neglect to respond to direct messages or DMs. Try to establish a dedicated time every day to answer your DMs.

I will conclude this series about social media marketing on Monday with some final thoughts. Enjoy your weekend.

  • RSS
  • Newsletter
  • Twitter
  • Facebook
  • LinkedIn