I saw a truck the other day that was wrapped bumper to bumper in bright yellow and red, for a painting company. It was quite a change from the typical paint-drip decorated white pickup with ladders you normally see a painter driving. What stuck out to me most was the marketing effort, again rarely seen in the painting business. It made me think that this business was a marketing business whose product is painting houses.

That led me to think about some past seminars I’ve given and blogs I’ve written about “What business are you in?” That question was answered in a short list of types of businesses, identified by the ‘need’ they fulfill for their customers. For example, the need for physical health can be met at a gym. This painter’s truck made me start to reconsider that angle. While I’m not ready to change my ideas completely, I am ready to start considering that we all need to be in one of three types of business:

1. I’m in the Customer Service Business! I’ve always said that Southwest Airlines is in the Customer Service Business. Their focus is on the passenger. I’ve even contended that if you were to take away their airplanes and give them, say, running shoes, they would continue on without a hitch, because they are in the customer service business and simply use their products to deliver that special experience. One of my favorite lines is, “We don’t want to tell YOU we have great customer service, we want YOU to tell OTHERS!” Know where that came from?

2. I’m in the Sales Business. Again, this business is not about the products, but is about building relationships with its customers. The focus is on creating a finely tuned sales machine that increases that top line each month and each year. When product is considered, it is designed with the sales process in mind. I might put Amazon.com in this category. They have built a great sales machine. They keep adding new products without a hitch because their sales system works so well.

3. I’m in the Marketing Business. Proctor and Gamble is in the marketing business. They know how to create products driven by their market, get it positioned right in front of them, and get the word out so that their customers flock to purchase thier products. They are not about the ‘best widget available!’ They are about marketing.

So, am I recommending that you become a Sales, Marketing or Customer Service Business? Yes! However, I’m not asking you to abandon your core strength, which is creating products that satisfy your customers’ needs. I’m simply recommending that you make one of the three methods central to your business. That way, you’ll get a steady flow of the customers you need.

Probably one of the most often given pieces of advice is: follow your passion.  We hear that in life, and we hear that in business.  I even have ‘Passion’ as one of the seven essentials for small business success in my eBook, “Do You Have What It Takes To Succeed?”.  I will say that a business owner without passion has about as much chance at success as one without capital.  However, there is a line at which passion becomes stubbornness.  This stubbornness can be to the detriment of the business.

What brought this to mind was a episode on TV of “Kitchen Nightmares.”  If you haven’t seen this show, I highly recommend it to small business owners.  The premise is that a world-renowned chef descends upon a failing restaurant and quickly turns it into a profitable venture.   The chef, Chef Ramsey, takes a similar approach each time: get the proprietor to admit there’s a problem; clean up the kitchen; change the decor; and, change the menu.  Chef Ramsey always looks around the area to see what menu would be most welcome to the town.  Then, he changes the restaurant’s menu to fit the bill.

The stubbornness comes in when a proprietor refuses to change his/her menu.  It is this moment that passion turns to obstinance and the business turns from a strategic entity into a pet project.  While we must all have passion in our businesses (passion for our product, for our market, for the business itself), we can’t forget whom our business serves: the customer.  When our passion steers us around our own customers, then our passion has turned to stubbornness.

In his comment below, Renato brings up the notion of the ‘up sell’ you normally get when ordering dinner.  This is the sales lesson I mentioned in the end.  Great point, Renato!

The lesson here is the Top-Down Sale.  There are three places this is very common.  Think about the last time you purchased one of the following:

• A car.  After you told the sales person what you were looking for, did they take you right to the most expensive version of that?
• A home.  Did your Realtor start your search at the top, meaning the highest priced homes?
• The Stereo Store.  Ouch.  These guys are the best (or worst)  at this.  Ever say you’re looking for a TV and get taken straight to the home theater displays?

The last example is the dinner table at a restaurant.  Whenever I try a new place to eat, I always ask the server what he or she recommends.  I like to know if they’re going to recommend the surf-n-turf, $54 plate.  One look at me, and they know right away I can handle such a plate!  I’m always surprised when the response is, “I like the pasta plate!”  First of all, I have never ordered pasta, but that’s beside the point.  The point is the server missed a great opportunity to sell me the granddaddy plate and, therefore, increase his/her own tip.  There is a local restaurant that is great at this.  I rarely leave there without some sea creature’s tail next to my steak.

‘Did you save room for dessert?’  How many times are you on the fence when it comes to dessert?  You are really too full to indulge, but you also know this place makes the best cheesecake outside of Manhattan.  All it takes is a little nudge from the server and cheesecake it is!

In thinking about your business, are you offering your clients the best you have to offer (the lobster and fillet)?  Are you making sure they’re getting the whole of your services (dessert)?

This one, simple concept of the Top-Down Sale can have a significant effect on your top line: revenue.  By simply offering your customers the best possible option, you will see an immediate increase in your sales revenues.  Now remember, we’re not out to steal from your customers.  Don’t push them to purchase the home theater when all they want is the extra TV for the guest bedroom.

Next time you’re out for dinner, put your entrepreneur cap on and check out the customer service and sales job your server does.  There might be a great model to use for your own business!

While watching some incredible footage on the Discovery Channel, I kept seeing some of nature’s most amazing marketers. Spiders, plants, birds, and other animals have each become experts in the 4 P’s of Marketing, namely Product, Place, Promotions, and Price.

Let’s look at Place first. In order for your market to buy your products or services, you must Place these products where your customers can get them — and easily. You’ve heard the expression the three most important things to a retail store: location, location, and location. Well, there’s a creature out there who has mastered ‘location’: the spider!

The late, great Peter Drucker said, “…the aim of marketing is to make sales superfluous.” In other words, if you are able to put the 4 P’s of Marketing together properly, you won’t have to go out and sell your products/services, your market will come to you. You’ll notice the spider picks a location, sets up shop, and simply waits for her meal to deliver itself into her web. She does not need to do a dance, send out a call, or fill the area with an aroma. She simply waits.

If you imagined capturing your market with a web, where would you build it? Think about location, time, and activites. Once you figure out where and when your market is moving, you will be able to capture their attention and their business.

When I did the ‘research’ for my latest presentation (and soon to be eBook!), “Do You Have What It Takes to Succeed?” one of the things I discovered is that successful business owners always had a good team and a good mentor. That quickly led me, a sole operator, to ask myself, “Can a sole operator run a successful small business?” In all the examples of successful businesses, I did not find a good example of a single person shop.

A single person shop will typically be a service business. It’s just impossible to run a retail or trade business without employees. A service business will typically charge by the hour or project. Given a 40-hour work week (okay, stop laughing!), what would a sole operator have to bring in, in terms of revenue, in order to ‘make it.’

Here’s what I’ve come up with:

Median income in America is around $48,000
Billable hours in a week: 25 (that’s five hours a day, allowing three per day for admin, etc.)
In order to make $48,000, you would need to clear (net profit) $925 a week
That is $37 net profit per billable hour
If your Net Profit Margin (you know, the bottom line) is 50%,
then your hourly rate should be $75 per hour
At 25 hours, that would be a weekly sales revenue of $1850
And a monthly revenue of $8000

If you’re a service business, you might be thinking that your profit margin is more than 50%. If so, I recommend taking a look at (your P&L!) your other 15 hours in the week. If you’re running a successful business, then you’ve built a team around you: CPA, marketing consultant, PR consultant, business advisor, etc. Chances are, your expenses are eating up a good chunk of those revenues.

These numbers might not line up for you and your business, but I think they provide a good exercise, even if you’re not a service business. Take some time to sit down and figure out what you need from your business’ bottom line. You might be surprised.

Provide your market what they want and need.  It’s a simple statement that implies SO much.  It requires an intimate understanding of your market and how your products fit their desires.  This is a life-time, ongoing exercise for any business, large or small.  In order to grow your sales, increase customer satisfaction, and keep tabs on quality, you must have your finger on the pulse of your market.

This all comes to mind because of something I stumbed upon on in cyberspace.  The square watermelon.

How’s that for listening to your market? The problem with a big, round watermelon is that it’s hard to store and hard to slice (as it rolls around the counter, slipping out of your watered fingers!). Turns out this Japanese farmer is an expert marketer. Read more on the BBC.

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Up until now in discussing the Word of Mouth Marketing campaign, I have focused on creating interest in your business through Buzz and a good Cheerleader. Now, your product MUST come through for you.

There are two key components to providing a product worthy of spreading the word:

1. Quality. Your product must exceed expectations. The key here is setting up the right expectations through your marketing communications. Your product must be positioned properly so that your customers know what to expect. Then, you must exceed those expectations.

2. Customer Service. WOW your customers with value added services, extreme attention to their experience, or a unique priority on how you deliver your product. In any case, make your customers’ satisfaction your number one focus.

If you are able to support a superior (to expectations) product with top-notch customer service, word will spread like wildfire by the mouths of your market!

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The second key to a successful Word of Mouth Marketing (WOMM) campaign is to get the endorsement of a Popular Cheerleader. In his book, The Tipping Point, Malcolm Gladwell recommends recruiting two types of people:

• • The ‘Connector‘: this is a person with a wide social network, a person who can spread the Word
  • The ‘Maven‘: this is an ‘expert’ whose opinion is widely accepted and used by others to make decisions

In addition to connecting and being the expert, you want somebody on your side who is also a huge fan of your business. When combining all three traits (connected, expert, fan), I’m going to call this person a Popular Cheerleader. This is a person you see bouncing around the mixers, networking groups, and other events. It is also a person other people go to for referrals. I’m guessing that as you read this, you are already identifying a few Cheerleaders in your circle. It’s time to get to know them. You will need to do the following for your Popular Cheerleader:

1. Get to know your Cheerleader. It’s possible that you’ve identified this person, but don’t really know her/him. Contact your Cheerleader and ask for a chance to get to know them better over a coffee or lunch. If you have a mutual friend or colleague, use that person as an ice breaker.

2. Make sure they are involved in your Buzz. If your Buzz efforts reached only a single person, it better be a Cheerleader. Let’s do better than that, but the point is that you want your Cheerleader to take the energy of your Buzz events and spread that around his/her circle.

3. Make sure they know you and your business. Take your Cheerleader on a tour of your facility. Give him/her samples. Tell your ’story’, the way you came to be in this business. Send your Cheerleader off with an experience to share with his/her network.Take the time this week to get to know your Popular Cheerleader.

Stuart Preston - Business Coach - Chandler, AZ">The main objective of the Word of Mouth Marketing (WOMM) campaign is to grow your business through referrals. As we mentioned in the last entry, there are three components:

1. Buzz
2. A Popular Cheerleader
3. A Great Product

You can draw attention to your business by taking out an ad in the local paper, by sending out mailers, or by making the dreaded cold call.

Those will all get your market to take a look your way. That’s a good result, but people also tend to be skeptical when lured by advertising, wondering, “what’s the catch?” What we want from the Buzz is to get them to replace skepticism with wonder, curiosity, and/or excitement.

Three ways to create Buzz:

1. Event. Throw an event that brings your target market to you and sends them home with an experience. The key here is to know your target market. Besides your products/services, what else to they enjoy? Wine and cheese? A BBQ? Football on the big screen? A viewing of The Secret?

2. Press. This is a tricky one. Getting press is actually pretty easy, which is why it’s tricky to get the right Buzz. The key is to try and be contrarian without being negative or overly controversial. If you can go against the grain, you will draw more interest and create more Buzz. For example, a local mailbox/shipping store might send out a press release turning the latest postal rate increase into a positive!

3. Jump on a trend. What are the trends today? Higher gas prices. Poor housing market. Big box stores. How can you turn those trends into Buzz? I’ve seen free gas card give-aways. Try having an event at a gas station and pump some free gas. Work with a realtor to create a strategic alliance that creates the Buzz. In any case, use today’s news headlines and trends to find a unique, Buzz-worthy opportunity.

Next entry: The Popular Cheerleader. Gotta find one to spread the word!

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I have been doing some thinking about advertising for small business as part of a marketing plan. As I continue to work with my clients and analyze where their business is coming from, I hear ‘referral’ or ‘networking‘ more than I do ‘advertising.’ Small business owners are much more likely to network through groups like chambers of commerce and business networkinginternational (BNI). They are purposely and proactively seeking out referral business.So, what else can be done? How about designing and executing a Word of Mouth Marketing campaign. Make this a deliberate part of your marketing plan.

A good WOMM campaign will have three main components:

1. Buzz
2. A Popular Cheerleader
3. A great product

Over the next few weeks, I’ll do a blog entry for each of these components. I know you’ll find that creating a WOMM campaign is easier than you think!