Small Business CRM Directory

Here is a site for small business marketers and anyone responsible for customer relationship management to check out. SmallBizCRM.com is described by its founder, Perry Norgarb, as “Your Small Business CRM & Contact Management Software Resource Center”.

There is a lot more content yet for me to look through before doing a full review, but at first glance SmallBizCRM seems to have covered most of the bases when it comes to discussion of understanding, selecting, and using CRM and contact management tools.

3 Reasons Business Owners Avoid Marketing – Part 1 of a 3 Part Series

Whether it’s marketing departments at Fortune 500 companies or a small business marketing team, I’ve observed the split between those that produce the product and those that try to attract customers to it. In these companies its not the job of the producer of the product to market it. As a small business owner, you do not have that split though.

So, here are a few thoughts on why small business marketing is important and why small business owners may not think of themselves as the marketing department. In my next articles I’ll share seven tips on how to practice small business marketing without becoming a salesperson.

3 Reasons New Business Owners Don’t Put Too Much Planning into Marketing

Bob Walsh reminded his readers of an excellent, relevant video of a Seth Goodin presentation to Google called All Marketers are Liars. Godin’s right – marketers are liars (it’s called puffery). And who wants to be a “liar”? Not me. Not you.

Yet the truth is that competency at a task does not correlate to how well the resulting products are received or celebrated. This is a hard thing for microISVs and most small businesses owners to hear. Here are three reasons why people put too little thought into their small business marketing plans.

1. They’ve been told they’re the best programmer (or lawn care guy, accountant, painter, etc) that people have ever worked with. What more could people want?
   Yet company owners are only paid if they get “hired”. Being great at building the product or service the company offers does not make one great at getting “hired” in the first place.
2. They Have Such Personal Excitement About Their Product That They Don’t See How Anyone Could Not Immediately Just Want It?
   Again, people could only want it if they hear about it. The marketing efforts we will talk about in the next article are all about helping people hear about a product, try products, and talk with others about their experiences.
3. They Don’t Want To Be One of Those Slimy Greedy Salespeople.
   They’re not alone in this aversion to sales. Katherine B. Hartman, a marketing professor at the University of North Carolina at Wilmington says that in an analysis of movies and TV shows from 1903 to 2005 “the salesperson character personifies some of society’s most despised characteristics-greed, deception, distrust, and selfishness.”

So I’m not proposing all small business owners become salespeople. I’m recommending that new companies should plan from the beginning for the marketability of their products, services, and business and have a small business marketing plan. In fact, make it part of deciding what product or services to offer.

Part two of this series is here.

Duct Tape Marketing

If you are a regular reader of this blog, you will have noticed we have been on a marketing tear lately. This is because Synap Software’s lead managment product, LeadsOnRails.com, is launched and the company is in marketing mode.

Do you see the error in this statement?

If you read John Jantsch’s Duct Tape Marketing book and blog you would know that marketing is not a mode, it is not a stage, it is not something you turn to after your product or service launches to try to sell it.

In his book, John Jantsch starts right off by saying that every business is in the marketing business. Yes – that means you. But you do not need to be a “marketer” to be effective in marketing your business.

John defines marketing as:

getting people who have a specific need or problem to know, like, and trust you.

That is a goal that most any business would have and the Duct Tape Marketing book gives practical advice on how to get there.

As I’ve said in previous book reviews, I am a huge fan of books that have practical implementations. I admire The Innovator’s Dilemma and Good to Great because they deal in “The Brutal Facts” as author Jim Collins says.

I recommend Duct Tape Marketing for the same reason. It is full of immediately useable information, but makes no pretention that marketing is easy work. Each chapter ends with three or four actionable items that while achievable, can take some real thought and effort.

No matter what “stage” you think your business or product is in, a marketing strategy is essential for small business owners. For example, Duct Tape Marketing discusses naming strategies for your company, even though choosing a company name is probably one of the first tasks founders do, and is often not considered a “marketing” decision.

The Actionable Points

Read about marketing. Duct Tape Marketing is a good book. Also see Seth Godin’s books. For those in the software business, I recommend Bob Walsh’s marketing entries in his blog and Bob’s new blog ClearBlogging.com.

Build-a-Business with Referrals (the Build-a-Bear Way)

If business owners were to ask what the ideal price-point is for their product, I would say that there is not one, but many. Regardless of size, your business should offer multiple price points along with a plan to show customers the benefits of moving up the price curve and to ensure it is a frictionless move.

We had my daughter’s birthday party this weekend at Build-a-Bear Workshop. If you have never been there, it’s a place where kids build their own teddy bears and have a great time doing it. They pick the unstuffed animal, stuff it, dress it, name it and take it home. Kids love it. Besides having a great time, I noticed that Build-a-Bear is a master at pricing. What I observed fits into a pricing model that can be broken into six steps.

1. Introductory Pricing

Do not compete on price. I’ll repeat that again. Do not compete on price. Yet, at the same time, do not let pricing keep potential customers from talking with you. Offer a price point that will not send prospective customers away before you have had a chance to demonstrate your full value.

You can take home a Build-a-Bear bear for as little as $10. But you could easily spend $100 on a fully dressed, shoed, accessorized, scented, speaking bear. Build-a-Bear advertises parties starting at ”$10 per guest” and then readily shows you what else you can get when you step up to $15, $20, and $25 per guest [1].

Don’t make customers write you off because of price before you have had a chance to show them what you offer [2].

2. Provide a no-pressure upgrade path

While we were at Build-a-Bear, there was absolutely no pressure to upgrade. We told our hostess what our budget was and that was that. She helped each of the kids pick out options the fit the
budget. Everyone was happy. So, with no pressure to upgrade, any buying decisions were ours.

When and if customers upgrade, it is because they want to, not because they were sold into it. Note though, that no pressure does not mean no opportunity!

3. Inform customers of all available products you provide

With colorful, clean displays, Build-a-Bear clearly demonstrates to purchasers the opportunities to upgrade. Colorful clothes. Sparkly shoes. Exciting sports accessories. All were right there – clean, sparkling promises of more and more fun.

If you are not in a retail environment, keep in touch with your customers by email newsletters sent out automatically, with a blog, or by mail. Even if you do not have an ongoing relationship (such as a monthly subscription), you should to follow a consistent process of sharing updates and new product offerings with your customers.

Whatever means you use, make sure that the products or services are readily available for purchase. Again, back to the bears…

4. Make upgrades frictionless

When I say “readily available”, I mean readily. At Build-a-Bear, the clothes are not ready to unwrap and put on the bear. Not ready to buy and put on the bear. The clothes and accessories are ready to be put on the bear right there. Easily. Quickly. You don’t go buy something and then put it on your bear. You don’t ask for a sales person to take something down off the shelf or the rack. It is all right there in colorful displays, enticing you to pick up and put on to your instantly cooler bear.

Shopping for your products should be as simple – and enticing – as that. If you are online, give your customers ample chances to say “I want that” with persistent and numerous links and simple shopping.

A lot of companies do the first four steps – introductory/tiered pricing, up sell, newsletters/blogs, and frictionless upgrades. (Netflix has plans starting at $4.99 a month, but if you want unlimited rentals it’s $9.99 a month. 37signals offers free versions of their products with occasional offers to upgrade).

Build-a-Bear though is an example of companies that go even further by turning their welcoming pricing and no-pressure strategy into a referral machine.

5. Extra → Give them your best even if they are not your biggest

It is critical to Build-a-Bear that all customers have a very positive experience. There is a reason why the hard sell would not work there. There is a reason why they want everyone to have a positive experience, regardless of how much they spend. That reason is; referrals.

6. Extra → The Power and Importance of Referrals

Over 50 percent of Build-a-Bear’s business comes from word-of-mouth referrals. By making its purpose and plan to make a fan (and a salesperson!) out of everyone who comes in the door, the value of each individual sale becomes less important and the value of customer satisfaction more important. A customer that does not spend much money today might send a ton of business to the company. The value is no longer only what they spend during their 45 minutes in the store, but who they send for years and months to follow.

This makes everyone put forth extra effort to ensure satisfied customers. In my next article, I’ll show you four other reasons you should encourage and depend on referrals.

The Actionable Points

Do you have?

1. Introductory pricing that invites customers to talk with you further.

2. Simple, tiered upgrades or additional products

3. Visible, constant reminders of those available upgrades and their benefits.

4. Frictionless upgrade paths.

5. An experience that rewards all customers along the path to “premium” status.

6. A plan to turn the positive customer experience into referrals (subject of a future article [3]).

Do you see how that works? Don’t just look at today’s sale as worth the $ it brought in today. Look at the value the sale may bring in future referral business and future upgrades with the present customer. Try to figure out what the potential referral is worth to you, and make sure to include that value in pricing and marketing decisions.

Notes

[1] This is not bait-and-switch. Bait-and-switch is when a product of advertised price is out of stock, or not suitable for your needs, or the customer is simply pressured or shamed into buying a more expensive product than what led them into the door. At Build-a-Bear, they are fine if you choose to stick with $10 as well because of the exponential value you have as a potential referral. I am in no way recommending you practice bait-n-switch. Your customers will not end up with the positive experience critical for this approach to work.

[2] Some companies fear scaring prospects away with price and so hide price until the last minute. I think in today’s marketplace, prospects expect to see pricing readily available and that you will lose more customers by hiding your price than by making it clear you have some basic pricing and that the best deals are available at a more premium price.

[3] Like real estate has its three most important factors; business growth has its top three as well: referrals, referrals, and referrals.