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61 posts categorized "Small Business Friday"

Thursday, March 01, 2012

How MindValley Is Building the Next TED (Only More Useful)

IMB_TEDRobotThis morning I watched an amazing TED video of flying robots that can operate autonomously and collaborate with each other at the same time. It is exciting technology ... just the kind of thing you would expect to come out of a TED event. As I write this, the video (and its big finish where the robots play a song together) is rapidly going viral online, and I have to admit I love watching things like this. The only problem is, I'm not sure what I can do with this mind blowing example except to share it with friends. It is great to get me thinking about the world, but not immediately easy to apply to my daily life. 

IMB_VishenLakhianiEarlier today on stage at the Underground Online Seminar 8, Vishen Lakhiani had a collaborative idea of his own to unveil. In a conference room filled with over 500 online entrepreneurs - many of whom have made their entire fortunes selling advice online - his announcement was unexpected, to say the least. As Co-Founder and CEO of a company named MindValley that publishes personal growth products, Vishen fit right in with the group of internet business owners packed into the crowded Crystal City hotel ballroom just a few minutes outside Washington DC. 

His company MindValley has a bold mission to help help people achieve their dreams through offering them the tools and resources to inspire them to get there. The products the company has launched are among the most popular and best selling in the personal development space. The company has won multiple awards as an amazing place to work, takes their entire 75 person staff on an annual retreat to an exotic island, and works with speakers and visionaries in many different industries.

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When Vishen took the stage, he talked about a common problem that any online entrepreneur will recognize - that great ideas are quickly and shamelessly stolen and copied. For MindValley, that meant that everything from copywriting to the design templates were being ripped off by their competitors and used to get results for themselves. Instead of getting angry, or speed dialing his lawyers (as other entrepreneurs might do), Vishen and his team embraced the copycats. And then they made a big promise.

Starting today, MindValley will be one of the first companies to be completely devoted to sharing everything about their business in an open source model. This means every template, every meeting, every spreadsheet about how they run their business will be shared online. The website www.mindvalleyinsights.com just went live about 8 hours ago, and the site is filled with videos, written articles, advice and tips. The site promises a treasure chest of information on everything from hiring and retaining great people to effective branding. 

Why would they release all this material for free? Unlike many others, the motivation isn't what I often call "karmic kickback" - a term that describes people who only do something for the expectation of some future return of positive karma. Instead, it is part of a bigger world view that Vishen and his entire team share.  He often speaks about "why happiness is the new productivity." The more you learn about MindValley, the most this announcement feels like the perfect fit for their mission of touching 500 million lives through their content by the year 2050.

In the months to come, it will be interesting to see how MindValley Insights evolves. For now, I highly recommend bookmarking the site and returning often to consume the great content there. It will help you hire better people to create a stronger business and find more happiness and fulfillment. Not to mention we'll need all the free advice and insights we can get just in case those autonomous collaborating robots finally figure out the nuclear launch codes ... 

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Friday, February 03, 2012

What The Amish Paradox Can Teach You About Marketing

IStock_000012334464XSmallLast year on a trip back to the US from South Africa, I picked up a magazine about a topic I knew very little about. It is of the common tricks I use to learn about different industries outside of the ones I work directly with – and in this case, the magazine I ended up with was called Farmer’s Weekly.

The content was as you would expect, advice for farmers on techniques, information about regulations that will affect their industry and ads for tractors and things like that. In the middle of the issue I picked up was a feature article about what the author called the “Amish Paradox”

This paradox describes the unexpected methods that the Amish use when farming their land that are working so well that they are continuing to run their farms profitably without interruption while many other farmers are struggling to make ends meet and often going under as well.  What makes the Amish technique so special?

They rotate their crops consistently (planting different items at different parts of the yar. They never use chemical fertilizers and use something called “legume-based pastures’ to keep the fertility of their land. They tend to grow smaller fruits and veggies (which some say they are tastier to). Perhaps most importantly, they do what is called “adding value” – by producing additional products such as fresh cheese.

In an industry facing increasing pressure from large industry leaders to plant more genetically modified crops, and focus on volume above all else … the Amish philosophy stands out. What can you learn from their lesson, even if you are not in farming?

  1. Stick to your ideals. For the Amish, their farm culture is mixed together with their religion and belief system. Few of our small businesses take such a principled approach, but if you do – it can help serve as a guidepost for what your business will do and how it will evolve, and what you will avoid.
  2. Think longer term. One of the biggest challenges in any business is to think of the long term and not of today. Crop rotation, for example, is a principle focused on making sure that land remains good for cultivating crops far into the future. Sometimes what it requires is passing up the opportunity to simply plant the most profitable thing every time.
  3. Avoid following the “experts.” The Amish philosophy goes against many experts in the farming industry who push for higher production and instead follows their more traditional path. This tends to draw many critics and also probably causes them to have lower revenues from their crops.  Yet this goes back to point #2 – and how your priorities tend to be different if you focus on taking care of your land for future generations instead of just maximizing profit today.

Friday, January 27, 2012

The 4 Principles Of Delusional Economics

IStock_000009238415XSmallWhen it comes to economic theories, there is plenty of fascination in the business world around how to explain what drives business and purchasing activities. Behavioural economics, the field of economics concerned with examining why people behave the way they do when it comes to their purchasing behaviour, is hot right now.  Bestselling books like Freakonomics and Predictably Irrational dig deep into the psyche of people to try and explain seemingly illogical actions.

My own upcoming book called Likeonomics, to some degree, looks at a similar theme of why we do business with people and businesses we like and what impact likeability has on building a trusted business. As part of the research for that book, I have come across a disturbing number of examples of a new type of economic philosophy which is becoming sadly common, and which cannot be explained by modern economic theory.

I have started referring to this philosophy as Delusional Economics – a new economic principle which explains the growing number of businesses who expect some type of unreasonable behaviour change or act of altruism among their consumers in order to help their business succeed.  This is not a strategy for success, even though sadly many businesses fall prey to it. Here are what I believe the four key principles of Delusional Economics are, and how you might avoid applying them to your own small business:

  1. Change a customer’s worldview. A worldview is generally how a person sees the world around them, and it is usually the toughest element of perception to change. It is why people vote the way they do, why they sometimes blindly believe something or someone, and why they approach life in the manner that they do.  To attempt to change how they see the world as part of your business strategy is usually a waste of time and effort.
  2. Getting people to pay for something that is currently free.  When a customer has become used to getting something for free, you really need to offer a compelling reason about why they should pay for something similar. Is it better, faster, more complete or more premium? Whatever the benefit, you need to make sure it is truly compelling to move people past the hurdle of being free.
  3. Basing a business model on revenue from nonexistent advertisers or customers.  More than one tech startup has been launched over the last several years with an extremely naive view of what advertisers will pay for.  They have a revenue model based on advertising, but no pipeline or ability to get those customers.  The end result is that their entire business success hinges on being able to connect with a key audience that doesn’t even really exist.
  4. Overestimating a customer’s ability to appreciate value worth paying a premium for.  A common problem with products or services targeted to the higher end of the market is that people in general are not that good at being able to detect what value is worth paying for. If I told you a bottle of wine was $100, you would assume it was great wine. If a wine bottle cost less than $5, it probably wasn’t. This is fine when it comes to wine, but in your business and industry it is probably much harder for a customer to discern the real value that they get and understand that it may be worth paying more for.

Friday, January 20, 2012

How “HateSurfing” Can Help Your Small Business

IStock_000003795732XSmallMost of us have heard the statistic that it is about ten times more likely that someone will post a comment online about a negative experience than a positive one.  It is not hard to believe if we just imagine our own experiences.  When we are a satisfied customer, usually the easy thing to do is go merrily on our way.  If the opposite happens, however, human nature is to seek retribution and the web is the perfect conduit. 

Negativity is super easy to post online, and irresistible because of the side benefit of being able to influence people who you have never met.  Add in the simplicity of Twitter and how it allows a constant stream of 140 character rants … and anyone could be forgiven for describing the Internet as the biggest complaint box the world has ever seen.

Most social media advice you read will tell you to start by listening to what people are saying about your brand online. Find the negativity and you can engage people and hopefully turn their experience around. What if you took an even more extreme approach and dived headfirst into the negativity?

“HateSurfing” is a term that describes the act of going online specifically to read as many negative comments, blog posts, tweets and messages as possible to generate insights that can help you run your business better.

A simple example is going to any product’s page on Amazon and only reading the 1-star reviews. Or you might do a targeted search on Twitter for “hotel” and “hate” to see what people are talking about that they hate about their hotel experiences, no matter where they are staying.  There are three core principles that can help you effectively use hatesurfing to find useful insights for your business.

  1. Find the best keywords. Depending on the industry you are in, people will often use different language to complain. They might share that something “sucks” or that it was a “rip-off” or they might use emotional words like “hate” or “ignored.”  Whatever the lingo, you need to get a good sense of what it is online so you can search most effectively.
  2. Choose the right platforms.  In every category, there are places where people congregate to discuss products or services. The travel industry has TripAdvisor, retail products are reviewed on Amazon, and restaurants have Yelp. Facebook and Twitter cross boundaries and be a good place to start for any industry.
  3. Spot the insights. Amongst all the negativity that you start finding, the real value to your business will be to find the complaints which might lead to new ideas for your business. This might mean a new feature to add to your business which no one else has, but that consumers are demanding. Or you might change a business practice of yours that you currently have after you see lots of complaints about it (not necessarily directed at you).

The ultimate benefit of hatesurfing is that it can help you to run your business better, and spot the opportunities to delight customers which your competitors might be missing. 

Friday, January 13, 2012

How To Make Your Business Recyclable Instead Of Green

Despite how it might seem, this is not another post about how you can create a more “green” business. Being green is a great business practice, and has the side benefit of helping your small business to make a positive difference in the world. When we think of recycling, it is no surprise that most people would immediately think of collecting newspapers and plastic bottles.

What if instead you considered recyclability as a principle that you could apply to many different aspects of your business? Here are just a few examples of how this could work:

  1. Integrate recyclability into your process – Think back to when you first learned to drive. Depending on when that was and where you grew up, a part of your experience might have been going to a driving school. Most driving schools have the same format – an instructor rides along with you in a car with a silly looking “student driver” sign on top of it. And where do you drive to? Usually from your house to the house of the next student and then back.  As a result, you get your driving lesson and the instructor gets to pick up his or her next student. That’s recyclability.
  2. Sell your products multiple times – The most common example of this is the traditional “day old bagels” bag at your local bakery which sells the remainder of yesterday’s product at a discount. A more pioneering example is recently launched a grape juice called First Blush, which is made from Chardonnay or Cabernet wine grapes that are picked early in their cycles when they are still sweet and before they are used for wines.
  3. Turn a special order into a “service.” Sometimes you have a client who pays for a special order which you can turn into a product to sell to other customers.  Restaurants are the best example of this, where often a customer may order a special cocktail – and the restaurant may try out putting it on the menu for some time to see if it works. The point is, sometimes going “off menu” can be the best way to generate new ideas for offerings that your business can sell which you aren’t selling today.
  4. Incentivize your customers to “resell” pieces of your business. Known in many marketing circles as the affiliate model of selling, this principle involves essentially incentivizing your customers to resell your business. Instead of just doing the obvious and offering a credit or discount if a customer refers your business … what if you take it one step further? Krispy Kreme is one brand that does this particularly well, by selling boxes with dozens of donuts at a discount to charity groups so they can take them and resell them as a fundraiser.  As a result, when you see kids raising money for their school or other groups, it is always Krispy Kreme that they are selling.

As each of these examples share, there are ways that you can make your business more recyclable just by paying more attention to the moments where you have an opportunity you could take advantage of.

Friday, December 16, 2011

The Captive Audience

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We spend a lot of time in marketing thinking about how we might engage our customers to pay attention to what we have to share. In the best cases, we are not just interrupting them, but instead offering a message and content that solves a real problem. Nearly every time you might imagine this situation, though, your consumers are probably in the midst of living their daily lives. How might you change your strategy if your consumers were stuck in the same place and completely captive?

Last week as I sat on a United flight about to take off, I started thinking about the idea of a captive audience. You don't get much more captive (in every sense of the word), than when you are sitting in your seat waiting for a flight to take off. Standing in line for a necessary evil like mailing a package is another situation where a similar thought comes to mind. Yet if you paid attention to your daily movements, chances are you would find many other situations where you are a similarly captive audience - from checking your email to waiting in morning rush hour traffic. 

These captive audience moments are usually seen as a bad thing. We are conditioned to dread them. But what if you could transform that moment? The usual video from the CEO of United on every flight, for example, shares the same faceless greeting and message of thanks for choosing to fly.  What if they changed it every month, or every week or even every day? Frequent travelers (those presumably most important to United) would be welcomed with a revolving message, like a changing headline at the top of the NY Times each morning.

A similar principle drove some Ogilvy colleagues to work with Coca-Cola to create “Rush Hour Cinema” in Bogota, Colombia – where they invited drivers stuck in rush hour to watch a short film on a big screen while handing out popcorn and cokes to drivers:

The bottom line is that we may be creatures of habit, but that doesn't mean we wouldn't welcome something to liven up that habitual behaviour.  If you can find a way to do that, you might transform a captive experience into one where you can build a deeper connection with your business.

Friday, December 09, 2011

4 Easy Ways To Lose Money Partnering With Groupon

IStock_000011826621XSmallGroupon has quickly become a lighting rod of debate among many small business owners. On the two sides of the issue about whether the service is good or bad for small business – the disagreement usually comes over the philosophy of deep discounting. Are you killing your profit margin in exchange for a short burst of fickle customers who will never come back to your business unless they get a similar discount? Or are you using a smart discounting method to bring new customers in the door, who you might convert into loyal customers paying at close to full price?

The answer, it turns out, relates as much on how you choose to use Groupon as anything else. A few weeks ago at the Corporate Social Media summit, some presenters from popular website analytics firm WebTrends shared some survey results that raised the possibility that the biggest success factor might be what products or services you choose to discount. This led me to the topic for this post – which spotlights some common strategies that lead to failure on Groupon – and how you might avoid them:

  1. Groupon Money Losing Strategy #1: Discount your core product/service. There are likely products and services from your business which many of your current consumers depend on coming into get. Discounting them simply offers your existing customer the same thng at a lower price … a sure recipe to fail. Instead, find products and services that have a higher margin where you can afford to lose some money initially, but will make it back if a customer gets hooked on that product. 
  2. Groupon Money Losing Strategy #2: Sell a longer term product or service. If yours is the kind of business or service that the average consumer might do only a couple of times a year (such as hair coloring) – that may not be the ideal thing to offer a deep discount on because you will have effectively lost your one chance to interact with that consumer for months.
  3. Groupon Money Losing Strategy #3: Offer a forgettable discount. While the simplest thing to do may be to offer a coupon where a consumer spends $10 to get $20 of spending power with your business … the reality of a promotion like this is that it is completely forgettable.  Instead, if you can tie a promotion to a part of your business – such as offering 3 rounds of Golf for $81 as a course recently did in my area – it can be much more memorable for consumers who choose to take advantage of it.
  4. Groupon Money Losing Strategy #4: Focus offer on the item and not your brand.  When writing up the offer that you will present for consumers, a common mistake is to only focus on describing your offer without doing a good job of selling your brand along with it. This misses a golden opportunity for building brand recognition among local consumers (presumably a major goal of why you would do the Groupon in the first place).  Instead, make sure you try to use a real photo instead of a stock image, include links to positive online reviews, include links in the body of the description of your business and generally do a better job of talking about why your business would be a great one for the consumer to choose not only for this promotion, but in the future as well.

Friday, December 02, 2011

3 Ways To Inspire Your Employees With Social Media

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As the full swing of the summer is starting up, if you are in any sort of retail business – chances are you have had to hire or release some of your employees to manage the seasonal flow of business. In other industries, keeping your employees motivated through the summer vacation and daydreaming season will likely become a new priority (if it hasn’t already). 

While the summer might bring these thoughts to the forefront of a small business owner’s mind, the real question of how to continually inspire your employees to show up for work happy and committed to the job you are asking them to do is one that you should be asking yourself every day.  Though there is plenty of conversation on using social media as a sales tool to help you bring in new customers – how effectively are you using it to inspire the employees that you already have?

Here are a few ideas for how you might effectively use social media to inspire your employees on a more consistent basis – to get the best effort, thinking and performance from them, even during the season of distraction :

  1. Share inspiring content. Whether you find a great article or a powerful video online, creating a culture of sharing content which inspires you can help to do the same for your employees. Whether you use the tried and true method of email to share a link to a great piece of content, or you take the more “social” approach of creating some sort of destination (such as a private group on Facebook) where employees can watch or read inspiring content – both can be great ways of bringing more inspiration into the workplace.
  2. Use co-creation to seek new ideas. Sometimes the biggest barrier to sparking innovation is routine. When employees are challenged to think beyond their roles and share new ideas in some way, it can get new creative thinking to happen and inspire them to think bigger.  So take a lesson from some consumer brands and sponsor your own employee video contest or blogging challenge and see what ideas and voices you get to participate. The upside is that some of these same people may make great voices for your business in social media when you do launch any marketing or external initiatives.
  3. Incentivize employees to attend relevant events. Social media doesn’t have to remain virtual and online. There are plenty of organizations and meetup-style events which are often primarily promoted through social media in your region.  Encouraging and even incentivizing employees to find them and go can be a great way to have them learn something and make great connections in the process.

Friday, November 25, 2011

The Anchoring Principle

On Black Friday, think about the most expensive product that you sell.  If you followed the advice of one particular behavioural economist named William Poundstone – you should triple it.  Last year Poundstone published a book called Priceless: The Myth of Fair Value (and How To Take Advantage Of It) where he shared a core principle that many others in the behavioural economics field have written about as well. 

It is called “anchoring” and it refers to the practice of using one high priced product or service option (an anchor) to make everything else that you sell seem cheaper by comparison. It is a simple idea, but one that is repeated over and over by large businesses as they focus on the psychology of selling.  It is also a principle that can help your small business.

In practice, it might seem a bit dishonest to use a trick like this. The truth that Poundstone argues in his book is that in reality people are clueless about what goods should be worth and what they would be willing to pay. How do you know that a mango should cost a dollar, or a DVD should be $24.99? These are arbitrary prices set based on what we are conditioned to expect in the market. The negative side of this is that when we expect to pay a certain amount for something, we may be ready to overpay.

This principle of anchoring is one that can be used to describe all kinds of situations we might see in real life, from the rationale behind why lawyers in personal injury cases often demand completely unreasonable amounts of money for compensation (eg - $20 million for the woman who spilled hot McDonald’s coffee on herself and sued them because the coffee was “too hot”).  When you ask for that much, settling for $2 million seems like a great deal.

Street vendors use this principle often, as you may head to any country in the world and the first price you get from a street vendor may be exorbitantly high – but fairly quickly they are eager to drop the price by 50% or more.

Pricing is always a tricky question as you try to determine what the true value is for what you have to offer.  Anchoring can be one way to help you get the most for all that you do, simply by giving your consumers an option that most will never take.  The side benefit of this is that you might even sell your high priced service or product to a few customers as well.

Friday, November 18, 2011

Human Sizing: Why Offering Less Is A Great Business Strategy

One of the truths of many American chain restaurants is that they all offer a portion size that no normal person could possibly finish. In theory, this is meant to ensure that you always have some food to take home – though critics will often point to this lack of portion control as a major factor in the obesity epidemic in America and its growth in many other countries around the world. Indeed, in the US, we seem to love celebrating the oversized – believe it or not there is even a Major League of Eating.

We have come to expect that portion sizes for everything from restaurant dinner entrees to movie popcorn will be huge.  Several months ago, my wife was attending a premiere of a new Bollywood film and sitting behind a famous and well known Indian actor. As someone brought him a “regular” size popcorn and coke to enjoy at the movie, he handed back the tub and asked for a “human sized” portion. 

Finding anything human sized is tougher and tougher these days – and the effect is going far beyond food.  Have you ever used the most of the special features on your phone?  How many of the hundreds of cable TV channels that you pay for every month do you actually ever watch? In a culture where excess is expected, your small business is constantly under pressure to offer more for less. Unfortunately, the cost of goods or services is a real cost which doesn’t scale.

How might you get around this without your customers feeling like you are skimping or just offering less value than your competition?  One trend in your favor is that there are plenty of consumers who would gladly pay the same amount (and perhaps sometimes even more) if they could find a “human sized” option. We don’t automatically want more or bigger stuff, we just want more value and offering less can be a type of value.

Small sized packages of snacks proudly declare they are “100 calorie servings” now. Apple is a brand that has become famous mainly for producing a VERY small number of products. Small is the new big – and that means simplicity can lead to a very profitable business strategy.

How many of us wake up and ask ourselves how we can offer LESS than our competition?  Probably no one – yet that may be the most important question you can ask yourself about your small business. Slapping more food on a plate, or more features into a list is not the same thing as offering more value.

Sometimes the most valuable thing you can do is offer less.