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Posts for July 2012
Growing pains
July 26, 2012
Once a business has become established with its own offices and other fixed overheads, hiring the right people for growth becomes an important priority. By far the most difficult person to recruit is always the right sales director.
Yet, in these troubled times, executing effective sales is right at the top of many growing companies' list of priorities.
Most start-ups are established by a couple of complementary individuals who are able to sell their products and services to family, friends, former work colleagues and anyone else that they like on a personal level.
These first customers should be cherished, as are they willing to give the new enterprise a chance and are flexible and understanding when the seedling company has its first serious challenges with delivery.
As soon as these inevitable hiccups are overcome, the first customers then become customer mentors, advising the new enterprise on growth and even recommending other people who might be potential customers.
In my experience, these times are viewed as the halcyon days of the start-up, when the company first begins to make a profit and the ever-present threat of bankruptcy has at last disappeared into the background.
Lifestyle businesses
Some companies never progress past this stage and remain boutique, life-style businesses, only ever selling to their friends and close associates. If they also learn to raise their prices to a sensible market level, these companies can be very profitable, so long as they manage their overheads sensibly.
Once established, there is always the opportunity to grow the company further with one eye on a potential trade sale or management buy-out. These are very attractive options, giving the original founders financial security for life, as well as the external recognition they felt they always deserved. This is their reward for the early risks when first going it alone.
To grow the business, the founders then acknowledge they must find a highly experienced sales director. This is the first person in the company specifically charged with finding new accounts, growing existing ones, hiring a focused sales force and ensuring that the sales pipeline grows steadily over the next five years.
This is also where it can all go horribly wrong. The natural tendency is to approach recruitment agencies, which provide impressive lists of candidates with résumés proving without question that the candidates have doubled sales wherever they have served.
Theses candidates then use their advanced selling and closing skills to impress their slightly naïve interviewers. While deeply impressive at the interview, there is often a distinct feeling that the new potential sales director is culturally different from the company they are joining.
These concerns are swept under the carpet, and the candidate gets hired, even if other members of the team also expressed concerns about their personality. Six months later the promised upsurge in sales has not happened, and there are complaints about the salesperson's over-aggressive attitude from customers and staff alike.
Personal experience
I speak from personal experience here. My first start-up was highly successful, so I had proven sales credentials for early-stage start-ups. I was much less effective in — and on a couple of occasions fired from — other start-ups where I failed to understand the culture of the organisation.
The learning point here is not to hire aggressive salespeople too early. The right time is when the company approaches thirty people and the sales director can be hired alongside other experienced industry professionals in marketing, finance and human resources.
This is all part of the painful growing-up process and necessary if you want to build a sustainable business. In the meantime, you should encourage everyone in the company to continue selling as you did before, in a low-key, personable way to friends, family and other people you like.
And when you do hire for sales:
- Have everyone in the company meet them; and listen to your existing employees' opinions;
- Ask the candidate to recommend one of their clients to speak to — ideally this will be someone from their 'little black book' who will make an ideal client for you, too;
- Don't just seek references, speak to previous employers on the phone;
- At interview, look for substance and not just style or bluster. If you don't see sparks of insight and understanding, you're not dealing with a professional.
Early-stage sales managers need to burn the phones and wear out their shoe leather on the street. Someone who wants to manage the sales spreadsheet alone won't deliver the goods.
Copyright ©Mike Southon 2012. All Rights Reserved. Not to be reproduced without permission in writing. Mike Southon is the co-author of The Beermat Entrepreneur and a business speaker.
Know, like, trust - using social media successfully
July 24, 2012
When my business partner and I quit our jobs to start our own business, one of the unexpected challenges we faced was the lack of a network with which to share ideas.
We turned to social media, and in particular Twitter to fill that gap.
We have successfully used Twitter to grow our network of peers, suppliers and customers and discovered that just like real-world networking, the “know, like, trust” process still applies. It’s just that social media accelerates that process.
Know: Find people to follow
One of the best places to start is with journalists in your sector. Most have a Twitter account these days. Follow them, then find out who they are having conversations with. Those people are also likely to be good people to follow — either important people in your sector or people who have the ear of journalists — in either case, good people to know.
Next, look for key local people, local business leaders, large local companies and trade associations. Follow them too.
Like: Old rules, new tools
It’s 60 years old now, but Dale Carnegie’s classic principles from How To Win Friends and Influence People apply just as well in the new world of social media as they did in 1950s America.
Introduce yourself to people you follow. Tell them why you followed them, and ideally, pay them a sincere compliment. Say hello to new people who follow you and take a quick look at their bio and timeline. What are they talking about? If it’s their cats, ask how they are; if it’s a business trip, recommend your favourite restaurant. Tweet things of interest to people you want to engage.
Look for conversations in your timeline where you can add value. Share your own insights and Retweet insights of others. Make others look good.
Find excuses to get back in touch. Keep an eye on your contacts’ status updates. Even small status changes can give you something to start a conversation.
Proactively link people together. Don’t wait for others to ask for an introduction. Review your contact list and look for ways to add value to them.
Trust: Take it offline
When you are ready, start to take your new network into the real world. Most people will be flattered that you want to take the time to meet them face-to-face. Keep it informal. Suggest a catch-up over coffee for instance, the next time you are in the area.
Try to position yourself at the centre of your new online network. Use industry events to arrange group meet-ups when many of your contacts are likely to be around. One of our biggest successes came from organising a real-world meet up (a Tweetup) that grew to the point where conference organisers began asking us how they could get involved in our event.
One final thing
Don’t let social media become a drain on your time. Time box it in a way that works for you. Check it for five minutes every hour for example; while waiting for a train, bus or taxi; or schedule some time around lunch-time or at the end of the day.
Mark Bower is co-founder of online social media management company CubeSocial.
Customer service is more important than price
July 19, 2012
After reading and commenting on this article, Competing on price? Ten steps to success, on Marketing Donut I was asked to write this blog post on the topic.
Do not try to compete on price; your suppliers will always win!
We’re a retailer; more specifically we sell army surplus. Much, not all, of our stock has been used and some people still see shops like ours as second hand clothes shops, a place to find a real bargain.
It may surprise you that we are actually more expensive than some of our competition. In fact, there are a couple of websites that are selling a few lines for less then we can buy them in for…
How is that possible?
Whether you know this or not; your suppliers are retailing and who can blame them?
If they can get a better margin on their items by selling direct to the customer then they’re hardly going to pass on that opportunity. No matter how important you are as a customer to them, they need to make money just like the rest of us.
There are some companies that will be honest about it and others that stammer on the end of a phone when you ask them about this new website that popped up. So how can you compete?
How are we still in business?
Customers can get our products elsewhere cheaper, so why do they buy from us?
Firstly, we’ve been in business for 24 years, so we have a good reputation. We rank very well for certain search terms, which means our website pages are consistently on the front page of Google.
To back that up we have a bricks and mortar shop, which reassures buyers that if anything does go wrong there is a physical location they can show up at.
In all honesty, it’s the simple things that count though:
- We reply, personally, to every email (no automated responses);
- We answer the phone ourselves and the people you speak with know our products, can deal with every enquiry, or refer you to another member of staff there and then;
- We use the gear we sell. We have real life experience of how our products work and how they’ll perform. We’ve even started to do product reviews and test on a YouTube channel that has gone down really well with our customers. Especially the Cool Box versus Land Rover;
- We send orders out every day, tracked and insured.
Selling is about abating fear and our competition doesn’t have the time or the inclination to get to know their products like we do.
Periodically, we’ll have a look at feedback left for the competition and this is what we see:
- Took over 2 weeks to arrive;
- Item arrived not as described;
- Never reply to emails.
Without a good reputation, backed up by a good service, your price is bordering on irrelevant, because the customers you upset will be shopping somewhere else tomorrow.
That is why soldiers drive 300 mile round trips to pick up kit from us, why we sold a job lot of parachute bags that are going to be used in the new Batman film and why so many Australians buy £7 thermal gloves from us and pay nearly the same again in postage (to be honest I still can’t get my head around that).
Rich Brady runs Denbigh Army Surplus (DAS). DAS is currently shortlisted in The Pitch semi-final — find out more here.
The power of kindness and testimonials
July 18, 2012
More than 90% of consumers listen to their friends and the people they trust when they are making a purchase decision. That is why every encounter of a customer with your store, brand or product is critical. Every time someone asks about your brand or product or a competitor’s product, a customer’s answer will be based on that one encounter.
Credible testimonials
The surest way to make your testimonial material believable and credible is if it is true. Like any other advertising material, you need to start your advertising with the quality of your product and/or service. No poetry, no artistry, no amount of Hollywood-level acting can ever convince the market to support your business if you treat customers like crap.
The Zappos story
One shining example is Zappos, an online store in the US. In their early years, they decided they would have zero marketing budget and would pour their resources into customer services. This is how they were able to afford setting up a 365-day return policy with free shipping.
They also don’t put a time limit on the duration of their customer sales calls. The instruction is to keep the customer on the phone for as long as the customer wants to talk. What is important is to make sure the customer is happy when they put down the phone. Their customer representatives are accommodating, patient and will do anything they need to do to make the consumer happy even if it means actually referring customer to their competitor.
And where has it brought them? In their 10th year they were worth $1.2bn, with 90% of their sales coming from customer referrals.
Advertising based on stories of kindness
When they were bought by Amazon, Zappos came up with their first TV ad. The advertising agency didn’t just settle on the traditional testimonial of other people telling stories about how great the company is. They decided to really demonstrate it by putting the customer representatives to the test. They asked several people to call Zappos with the most outrageous requests to test the patience of the customer representatives. The result is the best testimonial-based campaign of any company yet. Zappos didn’t just prove they make their customers happy, they proved that they are happy to do it, too.
Not all customer service programmes have to be as extensive as this. But businesses of all sizes could learn a lot from Zappos.
Lucy Gould works for KPI, an SEO specialist.
• Bolt Insurance has produced a great infographic on customer service here:
Allow your target audience to sit back, watch (and buy)
July 16, 2012
A clearly thought-out and well-produced video has the power to cut through noise and clutter; it allows the viewer to do nothing other than to sit back and watch for 90 seconds or so and find out all they need to know about your business.
Video is becoming an essential part of our marketing armoury — it's so much more than a “nice to have”. According to Buyersphere (2011), 50% of UK business buyers now view videos as part of the purchasing process.
As with any other marketing activity, a clear strategy is essential. Video can achieve multiple objectives — such as brand awareness or direct response sales — however a single-minded strategic proposition is required for greatest effect. If in doubt, create a series of videos with a single message for each one. Plan each video to follow on from the next, in a logical manner. This is especially effective for educational videos in specific niche markets.
Optimise your video
And even though YouTube is now the second largest search engine (after Google), posting a video online does not guarantee views — the content needs to be pushed and sharing via social channels should be encouraged.
As part of a search strategy, video is also particularly powerful. The use of keyword tags, meta tags and an effective title will ensure your video ranks more highly. Forrester Research found that a well-optimised video is 53 times more likely than text to appear on the front page of Google.
Video is perfect for conveying complex information simply and since only 7% of communication concerns the words that we actually speak, what better way is there to demonstrate the 93% that comes from body language, facial expressions and tone of voice?
Cost should not be a barrier — with detailed pre-production planning, time spent filming and editing can be less than that of a printed brochure and of course there are no distribution costs. Against clearly set objectives, ROI can also be about more than the “number of views”.
So, if you're not already using video, it's worth thinking about.
Luan Wise is an expert contributor to Marketing Donut and is a freelance marketing consultant.
Facebook's Open Graph: good for marketers?
July 11, 2012
Keeping up with Facebook as a marketer is like clothes shopping for a little kid. As soon as you shell out the money for a nice pair of sneakers and or a jacket, the kid quickly outgrows them and leaves you on the hook for more money. Try as you might, you cannot stop this growth. You just have to go with the flow. And recently, Facebook has been operating the same way.
As soon as marketers get invested in the way Facebook is operating, boom, here comes the new Timeline feature, and here comes the IPO.
Some of these Facebook changes have been great for marketers using the service. And if this same trend holds true, Facebook’s Open Graph apps system will also be a good thing for advertisers using the site.
But that is just one side of the story. Marketers may love it, but are we sure that Facebook users will?
How Open Graph will work for marketers
In many ways, you can think of Open Graph as a huge data collection service. What it is, essentially, is a series of different apps spread out over a network that will collect user data about anything you could possibly imagine.
Open Graph is a giant tool that will tie into Timeline to present pertinent materials directly in a user’s face.
Of course, this is just as much for users as it is for marketers. Users get to experience a true-to-life timeline experience that takes actions they make on any partnered site (ie millions of different sites out there) and transforms them into genuine articles of social material via Timeline, News Feed and other Facebook social features.
This obviously helps marketers due to the sheer amount of social context gained. “Johnny just liked YourBusiness” is what your business hopes to see with basic Sponsored Stories ads, but now there’s a far greater chance that Johnny will see your ad to like it in the first place. Open Graph is able to discern much more of Johnny’s interests, likes and hobbies. Whether it’s listening to music or ordering a pizza, Facebook will be collecting data on a user’s actions.
You will obviously be able to use Open Graph apps to your advantage as well. You will be able to create a slew of easy apps for practically any purpose you wish them to serve. This allows you much more social context on the network.
The graph tracks what users do
Since the Open Graph connects apps and websites to Facebook, your activities across the web can potentially get fed into Facebook and appear in your timeline and in friends’ feeds. In consequence, information about what you do is instantly spread.
But do you want this to happen?
Do you want to always show what you’re listening to on Spotify, what you’re watching on Netflix or what game you’re playing?
When Facebook adds features like this, they risk becoming more of a marketing platform than a social hub. It’s your activities where there are commercial interests that are going to get highlighted, maybe pushing down traditional, non-commercial posts.
Today, the mix between sponsored and organic posts is fine, but we have to remember that Facebook was built for social interaction and that is what we use the site for.
Craig Robinson is the editor of Qwaya.com — a Facebook Ad tool that allows you to run campaigns in a more efficient way.
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