July 2006 Edition

Fundamental Marketing
Building Your First Web Site
Branding - Part 3
Who Not The Do
Tech Corner
Some Smiles
 

FUNDAMENTAL MARKETING

Over the years I found understanding marketing one of the most difficult tasks I had.  So many books, so many articles, so many opinions and trying to figure out how any of it relates to me and my business.  It seemed that marketing became a large, mystical “thing” that was important but it was as illusive as a ghost.  After only 32 years I think I have a better understanding of this thing we like to call marketing.

First of all, when someone tells me they want to know more about marketing what they are really saying is they need more customers and marketing seems like a neat word to use.  Secondly, there usually is not a basic understanding of marketing, sales and the business processes involved so we use the word marketing.

Let’s clear up some of this mystery…

There are two basic types of marketing a new or small business needs to fully understand and utilize, Strategic and Functional.

STRATEGIC MARKETING
This is the first thing you must do if you are to develop an ongoing business that is self-sustaining.  Remember the primary reason a business exists—To Survive!  Strategic Marketing is done at least annually and it addresses at least the following issues:

Know your competition—you must research them and learn what they are selling, how they are selling, how much they are selling it for, to whom they are selling and what is their process of selling.  You cannot know enough about your competitors—EVER…

Your product/service mix—what are you going to sell?  How are you going to sell it, to whom, at what price and what are your selling processes.  If you do not have a comprehensive understanding of your selling processes then how can you possibly do any realistic forecasting of sales?  You need to know what products/services you are going to sell into what market segment.

Market segments—you must fully understand your market segments.  Let me explain this a bit further.  Let’s say I sell web sites for small businesses and every small business needs one.  One thing I can do is to attempt to reach everyone all the time.  The reality of this is there are about 240,000 businesses in Colorado and 230,000 of them are small business.  My target is small business, but how can I possibly reach 230,000 prospects?  It costs me 65 cents to do a simple mailing that amounts to $156,000.00 and that is not in my advertising budget yet.  I need to look at a smaller group or market segment.  I need to look at these 230,000 companies and put them into categories I can understand.  Then I need to prioritize the categories based upon some basic factors like the one I have the most knowledge of, the one I know the most people in, the one that is growing the most or projected to grow the most.  From this process you will pare down the list of 230,000 to a number that makes more sense to your time and budget and you will have much more success.

Once you have this preliminary work done you need to develop your lists.  You need to figure out where to get a list of key prospects.  Some libraries have the information and you may even have to go to the Denver Public library or their databases on line to get what you need.   You need to have definitive information such as contact person, company name, address, phone, (e-mail) and web address for every one you wish to target.  You need have a solid understanding of every company you wish to target.

Product/Service Pricing—this is a major gotcha for so many companies.  If I were to sell web sites at $25.00 each I could sell thousands of them, but I would not make any money.  Remember the fundamental reason a business exists…… to survive!  At $25.00 each I would not survive.  Based upon our research we determined our starter web site will be sold at $660.00.  This eliminates some of the prospective buyers and we are sorry about that indeed.  However, when we sell one of these sites we make a reasonable profit so we can survive.  Conversely, if we sold the same six page web site for $2,000.00 then we would find even less customers, but those we find will generate very high profits.  You have to determine what you want to accomplish, with whom and at what price.

You must be constantly aware of pricing for sale or pricing for profit.  A business must make a reasonable profit to survive and to then grow and prosper.  These specifics are addressed in workshops on finance.

The best place to sell—also the most forgotten—your customers.  Do you have a plan in place right now that sells to your customers?  Do you meet with them frequently and learn more about their business?  Do you meet with them just to say hello and how are you?  So many people fall into the trap of doing what the phone demands every day and lose complete track of managing their business.  Keeping in mind that your customers are your business, no customers = no business!  Remember, your customers are your
competitors prospects!  If you do not have a Customer Development Plan of some sort that is organized and executed properly you just stacked the odds against your success.  Many companies, including mine derive 80% of the annual revenues from customer work, NOT new customers.  Work with someone like the local SBDC or Score to help you develop a comprehensive Customer Development Program.  Next year is much easier if you start January 1, 2005 knowing you have 80% of your projected revenues already covered… 
Think about it.

This about covers Strategic Marketing that you do at least annually, next month we will get into Functional
Marketing, the stuff you do every day, week and month.         

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BUILDING YOUR FIRST WEB SITE

One of the companies I've been a partner in for 10 years is a web development company and we've seen some amazing things in these years, but those require a complete story so I won't share most of them here.

A wise man taught me a seemingly funny saying many years ago, "everything is simple until you understand it", and this applies directly to building or having a web site built for the first time.  We work hard to educate people on the many trip-points they can encounter as they walk through the web site process the first time.  For the next couple of months we will share the details of what you should watch for in a web site project.  Please be aware there are two aspects of the web development process.  The first one is the technical aspect that includes the actual domain name, how it is registered, how the web site is actually developed, in what software and who has control of the code, the hosting options and so on.  The second aspect is the message you wish the web site to share with the user and how the story will unfold.

This month let's dig into the domain issue deeper.  We see many people get into expensive trouble by not taking the time to fully understand this first component of their web site.

A domain name is the name of a web site – it’s the name between the “www” and the extension, for example: www.mycompany.com, and choosing a domain name is usually the first step in the web site development process.  The name should be a part of your company name or at least be the title of what the web site will be about.  Ideally, a domain name should be as short as possible and easy to spell.

Beware: if your company name is not registered with the Secretary of State and you use your company as your domain name, you probably won’t be able to use the domain name IF someone else has the same name registered with the state.

Domain names have several different extensions, such as .com, .net, .org and so on.  Of course, the .com is the most widely used which is why the other extensions have been made available because many domain names with the .com extension are already registered.

While there’s no absolute rule what extension to use, however current conventions are:

• .com = company

• .biz = business

• .net = telecommunications or Internet infrastructure

• .info = information

• .org = non-profit

• .ws = web site

There are many more extensions available, but this will give you an idea of the most common.

Registering A Domain Name

When you “register” a domain, you are the legal “Registrant” and it’s important that your name and contact information be listed as the Administrative Contact.  If someone else is listed, you will have no control of your domain thereby allowing others to use it as they see fit.  If this is happening to you, call TeamBTS at 303-833-2819 for assistance.

It’s important to keep the contact information current in your domain account, especially your email address because that’s the control point to allow changes in your account to be confirmed.  This is a security measure for your protection.

When you register a domain, be sure to write down the username and password you assign and keep it in a safe place.  This information is critical for changes and maintenance to your account.

You do not “own” the domain.  You “rent” the rights to use it.  The good news is that as long as you keep your renewal fees paid, the domain is yours as long as you wish.  You can register/renew for a minimum of one year or more than ten.  While there are many Internet-based companies through which to register your domain name, called “Registrars”, there is only one master database for all domains in the entire Internet.  This is called the “Who Is” and allows you to search to see if a domain name is available.  If a domain name is already taken, it will usually show who it’s registered to.

The cost to register a domain varies from Free to $35 per year.  Beware of the Free!  There are hidden charges that may not present themselves until later.  Lower priced registrars may not have a toll free phone number, may charge you for support or may not support you at all.  Some will charge as much as $200 if you want to make changes to your account and some registrars will not allow you to transfer your domain to another registrar.  All reputable registrars have an online policy agreement, please read it before making a commitment.

If you want to see if a domain name is available for registration, go to registrar www.NetworkSolutions.com, type in the domain name, check the box for your desired extension, and click on Search.  You can register your domain at that time by following their instructions, or simply exit their system if all you want to do is check availability.

When your domain name has been registered, you may receive fraudulent notices from various registrars via email or postal mail indicating that your domain is about to expire and/or asking you to transfer your domain to them.  Unless this notice is from the company you registered your domain with, disregard it.  One of the worse offenders of this scam is Domains Registry of America.  You may also receive renewal notices from your legitimate registrar months in advance of your expiration date.  You do not have to renew at that time; a month prior to expiration is adequate.

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BRANDING - Part 3

As we've addressed in the recent articles here many of us think of branding as the look of our logo or our materials.  This is an important part of the branding process, but it is only the beginning.  Uh oh, there is the word "process" again.  If you follow the Small Biz Newz, or read any on our web site you will see that word used a great deal.  The reason is simple, we believe the following:  "Business Is A Set Of Simple Processes Running Concurrently That Produce A Predictable Result".  If a person does not understand or learn processes they will not be good managers because business is process!  That is another story for next month.

What exactly is Operational Branding?  This is the more subtle or hidden part of branding.  It encompasses all the things you do to make your business work.  It is how you do business...

Your reputation is your brand.  How prospects see you is your brand, as is how customers view you, how your vendors see you, how your colleagues view you and how your community sees you.  For example, if you are not involved in your community such as the chamber, the rotary club, Lions and so forth, you may be perceived as someone who does not care about the community.  This may seem unfriendly to some people and you need to determine if that perception is important to you and your business.

How you react to challenges is a major contributor to the brand you leave in the market.  If a customer has a problem on an order that may or may not be your fault, do you smile and replace the item or return her/his money or do you become defensive and try to prove it was their fault?  If a vendor ships you more product than you ordered, but only charges you for what you ordered, do you call them and let them know?  These are important things to consider as you define how you will do business.

How and when you answer the phone is a major part of your brand, as is how quickly you return phone calls, how you word letters, how quickly you respond to questions and how hard you work to satisfy the needs of your customers.

I've read some things in the past that I have posted in my office right in front of me as a constant reminder when customers call or email me at times that may not be convenient to me:

• Rejoice in the interruptions

• Interruptions are clients in need

• Clients generate interruptions

• Without clients you have no business

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WHO NOT THE DO

In the following months you will be reading more about the "Who Not The Do" which is my title for it is more important of who you are than what you do to make your business a success.  We will address many of the behavior traits that make businesses work or fail.

I recently read a report written by LeadershipIQ (www.leadershipiq.com) that provides information that supports my view that "who you are is more important to your business success than what you do".  Now let me explain what I mean by this.  If you read the section above about Branding you will have some insight to what I believe.  How you deal with people will control your success in business.  Technical skills can be hired or learned, but business is based on relationships. 

Every chance I get to do this exercise I do it, and I've been fortunate enough to show this to a couple of hundred people in batches of five to 40, with a variety of backgrounds and experiences, big and small companies, private companies and governmental agencies and the results have been 100% consistent.

Here is what I do...

I have a flip chart in the front of the room and I draw a vertical line down the middle of it.  At the top of the left side I write SOFT SKILLS and on the right TECHNICAL SKILLS.  I then pass out three small (1" X 1.5") sticky notes to everyone in the room.  Once everyone has a maximum of three I ask them to think of the most influential person in their life so far.  Then, think about a maximum of three things that person taught them.  Now the tricky part, once they have up to three (less is ok) lessons written down, one on each sticky note, they come to the front of the room and place the lesson in the column that it belongs.  Now the consistency.

95% of the lessons people have learned will be in the SOFT side and all but two or three in the TECHNICAL side will actually belong on the SOFT side.  Now I would like to ask you to think about what this really tells you.  Think about the importance in every person's life of the SOFT skills versus the TECHNICAL skills.  Then think about the last job interview you had and how much time was spent on discovering your soft skills, or how much time you spend now as you hire people.

Food for thought don't you think?

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TECH CORNER

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some smiles

Hello, Welcome to the Psychiatric Hotline

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