Thursday, October 11, 2007

Marketing to the Radiohead Generation

When Radiohead recently decided to make their new single available for free and asked fans to pay at their discretion, business around the world sat up and listened.
Not only was it a genius stroke of marketing but also did it transform customers expectations of what to expect from marketing and promotion in the future.

A spokesman for Radiohead says: 'As you might imagine, offers are ranging from nothing to more than you might pay for a CD in the shops.' The Observer goes on to say that “In part, Radiohead are asking: how much do you value us? But implicitly, they are also questioning how ..much people are prepared to pay to download music over the net. It's a question that music companies have been grappling with ever since the file-sharing site Napster was closed in 2001“.

This is just another way that the Internet is changing the way we do business.

The UK Observer points out that “Once again, the economics of the music industry is being turned on its head as artists take matters into their own hands. Haven't we already seen Prince sell 3m copies of his new album via a deal with the Mail on Sunday during the summer? Lily Allen, Arctic Monkeys and countless others have launched themselves via email or social networking sites such as MySpace and Facebook.”

And of course many of you will know that its not only the music industry using the shock tactics to boost sales. Companies like Netscape making their internet browser available for free, or Google giving you a range of free software applications simply to attract and keep your custom has become part of what we expect as web consumers.

The question is what next in the race to attract the Radiohead generation and where do we go as small business owners who don't have millions in the bank to back up our free offers?

For me the answer lies in balancing the free stuff with the revenue gaining products on your website or in your business. Make sure your free stuff is as good as the products you are charging for. Care as much for the customers paying you as the ones who are not and always ensure that the customer recognises the value in your products.

When offering free stuff, why not use it to:

Give at test drive or trial
Create sense of ownership
Make emotional connection with your clients
Under promise and over deliver

I'm guessing its back to the marketing drawing board for some of us.

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Innocence of the young

Often our young ones come up with the most curious quotes. Here are a few.

JACK (age 3) was watching his Mom breast-feeding his new baby sister. After a while he asked: "Mom why have you got two? Is one for hot and one for cold milk?"

MELANIE (age 5) asked her Granny how old she was. Granny replied she was so old she didn't remember any more. Melanie said, "If you don't remember you must look in the back of your panties. Mine say five to six."

STEVEN (age 3) hugged and kissed his Mom goodnight. "I love you so much, that when you die I'm going to bury you outside my bedroom window."

BRITTANY (age 4) had an earache and wanted a painkiller. She tried in vain to take the lid off the bottle. Seeing her frustration, her Mom explained it was a childproof cap and she'd have to open it for her. Eyes wide with wonder, the little girl asked: "How does it know it's me?

SUSAN (age 4) was drinking juice when she got the hiccups. "Please don't give me this juice again," she said, "It makes my teeth cough."

DIANE (age 4) stepped onto the bathroom scale and asked: "How much do I cost?"

MARC (age 4) was engrossed in a young couple that were hugging and kissing in a restaurant. Without taking his eyes off them, he asked his dad: "Why is he whispering in her mouth?"

CLINTON (age 5) was in his bedroom looking worried. When his Mom asked what was troubling him, he replied, "I don't know what'll happen with this bed when I get married. How will my wife fit in?"

JAMES (age 4) was listening to a Bible story. His dad read: "The man named Lot was warned to take his wife and flee out of the city but his wife looked back and was turned to salt." Concerned, James asked: "What happened to the flea?"

TAMMY (age 4) was with her mother when they met an elderly, rather wrinkled woman her Mom knew. Tammy looked at her for awhile and then asked, "Why doesn't your skin fit your face?

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Tuesday, October 09, 2007

Customers for life

In this feature on the business of small business , I will be offering views on everyday topics that can make a difference in your business. If you want me to cover anything specific, leave a comment here.

Following the statistics on customer service, here are some thoughts on the value of keeping your customers for a lifetime.

Through out my many workshops and seminars conducted world wide at universities, small business fairs and exhibitions, book launches, business breakfasts and networking events etc, one of the issues I'm always impressing on the audience is this one. Take note of this message today and your business will thrive.

There's an old truth that one customer, well satisfied, is worth a fortune. Over and over again, I work with companies who are determined to improve their advertising to attract new customers. They spend fortunes looking for better copy, the write spokesperson or the right "media mix." All the while, current customers are evaporating or (worse) doing business with their competitors.

Imagine for a moment a brand or supplier from whom you or your family buy on a regular basis. Once you are happy with a product you are likely to return to this shop or supplier for many years, in fact in some cases both you and your family will return for a lifetime. What is the revenue generated by this supplier by simply keeping you as a client for the next 20 years? Lets also not forget about the friends and family you will be referring to the supplier for the next 20 years.

It is always easier and more profitable to keep a customer than to attract a new one. Advertising is expensive! Negotiating the first sale, learning the needs of the customer and serving them well is difficult. To grow your business, focus on repeat sales.

Your customers are your best source of new ideas and innovations to put you ahead of the crowd. Listen to them, honor them, go the extra mile and work with your customers to achieve what you both want: a satisfying and profitable long-term relationship.

Monday, October 08, 2007

Statistics to take notice of!

If you don't yet think that effective customer service is as serous as a heart attack then perhaps today you will change your mind.

A few statistics to take notice of:

90% of customers surveyed in 2002, listed "customer service" as one of the top three things that influence their buying habits. Of that 90%, 68% listed customer service as the most important thing; above the reliability of the product or service.
Gregory and Kuchinsky 2003.

Even in purchases of the most functional products, consumers tend to be swayed more by how a product appeals to their emotion and cultural values than its rational virtues such as durability or ease of use.

Only 11 out of 100 dissatisfied customers will place a formal complaint with business, but 42% of all dissatisfied customers will tell 20 to 25 people about their dissatisfaction.

For every complainer, there are 31 with the same complaint that never say anything.

93% of all unsatisfied customers do not repurchase from the offending business, compared to the 70% who remain loyal when their complaints are satisfactorily handled.

On-line Student Tutorials

This is a much needed idea aimed at students and school goers who fall behind at school or simply want to improve their grades.

An Internet business that focuses on supplying quality tutorials on the web could be lucrative. Imagine being able to offer courses ranging from how to understand Maths, Speak and write better Zulu and how to pass the science and biology exam. The range of courses on offer could be huge and could cover every aspect of school ranging from hobbies, education, sports, business, languages and much more.

The great thing about this idea is that once it is set up, your overhead costs are really low and you really only have to focus on marketing

So if you have a bit of capital, love education and are willing to commit for the long term then setting up an Internet tutorial website could be both enjoyable and lucrative in the long term.

This business can easily be run from home initially until growth demands
office space of your own.

Upside: If you remember your school days and the frustration of not understanding Maths, science or any other subject, or if you have kids in school currently experiencing the same challenges you would know that this business idea is a winner.
Downside: Its fairly easy to start-up and once you make a success out of it you can be assured that competitors will follow.

Verdict: A great idea for entrepreneurs with IT savvy, a bit
of cash and the drive to make it work. Initial set-up costs may be relatively
low but a solid marketing plan and budget to support it is a must. My
research has shown nothing similar in South Africa yet, so the early
bird is likely to grab market share.

If you need support with your business or business plans please contact us business
plan consultants

Saturday, October 06, 2007

The Big Idea - Making a difference

With another series of Big Idea workshops successfully completed, this time as part of the Small Business Week exhibitions in both JHB and Cape Town, where we also started working with and supporting SAB-Miller in their Kick Start program, I'm happy to report that we are making a significant contribution towards business starting and growing in many areas through out the country.

Last week saw us conducting workshops and an exhibition in Durban as part of the Durban Small Business Fair 2007. This image shows the head of our Big Idea business arm, Lluwellyn Diedericks with the Head of the Business Support unit of ETHEKWINI MUNICIPALITY Mr Philip Sithole.

The next Big Idea workshops will be taking place from 19-23 November 2007 at the
Royal Show Grounds, Pietermaritzburg, KZN where a whole series of workshops focusing on all stages of the small business process will be presented. I hope to see you there.

Small business funding more accessible

Even more great news for small business owners looking for funding this week as Standard Bank and Government sponsored Kula Enterprise announce new measures with which to make finance to small business more accessible. The credit indemnity model, largely based on the loan guarantee scheme found in the UK and US whereby the government and in this case Kula Enterprise. Basically underwrites the loan taken out by the entrepreneur. With the IDC announcing last week that it will be contributing R1bil towards a fund supporting small business, this is another major step in the right direction.

This is a major boost for entrepreneurs who may have become increasingly frustrated with the availability of loans and credit form the SA banking community. With the recent credit act making loan finance even more difficult to come buy, this agreement could not have come at a better time.

Finally Kula Enterprise is doing something useful with the more than R1bil funding they receive from the government, national and international CSI investors each year.

With much talk in the past year about strategies being put in place to make South Africans more entrepreneurial and our entrepreneurial rating in world circles sliding down the chart, its hard to ignore the simple fact that funding for start-up simply have not been accessible on reasonable terms to the thousands of would be entrepreneurs out there.

For assistance with finding funding for your business venture capital help

More on this in Business day and the SABusinessHub web forum

Wednesday, October 03, 2007

What will small business clients buy from you?

For many years entrepreneurs and small business owners simply did not consider the services of business coaches. For many years small businesses simply could not compete with larger organizations.

Today more and more small businesses are using business coaches to fine tune their organizations, skills and competitive elements. Is it any coincidence then that more small business are now taking on larger organizations and winning?

The top services small businesses and entrepreneurs are buying from me as a coach right now:

1. collaboration/tossing ideas around services

2. goal setting/achievement

3. training (manage better, sell and market more effectively, maximizing opportunities and budgets etc.)

4. problem solving/issue resolution

5. restructuring/redesign of how the business works

6. profitability focus

7. ramping up strategies/support/structure

8. new business start up design/support

9. support during difficult times/face the facts

10. working on vs in your business - see previous blog post