MYSMB Part 1 – Assess Value, Passion, and Risk

Holy smokes I’ve been busy. I’m supposed to be working on something else right now, but promised to get this series rolling out last week and then again this week.

As a quick aside, we launched websites for Essex Appraisal and Kimberley Studios over the last week. Both are simple CMS websites built with Concrete5 and Kimberley studios uses a Wufoo form for the online rental application. I’ll be launching our own consulting site soon as well as a new business line for the embedded hardware geeks out there. Details to follow here soon.

Anyways, on to Part One:

Marketing your Small Business – Know what you do, what you’ve done and what you need to succeed.

Before looking at print, television, radio, social media, word of mouth, or any other channel of advertising, your budget and ad copy, the most important thing to do is figure out some answers to a few questions:

What is it you provide in exchange for money, or other goods, that provides value to your customers?

That question may sound absolutely stupid for many business owners. “We sell widgets you idiot” you’d say, or “We build websites” or whatever it is that you do. These responses all answer part of the question, but not all of it. Widgets and websites themselves can be great products and services, but anybody can sell widgets or create websites. I can buy widgets from anywhere. I can pay almost anyone to build a website if I need it. The goal of this question centres around the VALUE you provide. And not value from your perspective (“We’ve got the best widgets out there”), but the value from your customer’s point of view (“Their widgets are good enough, but their service is really good and they make it convenient”).

Because anyone can sell products and services, the goal is to see how you add perceived value over your competitors. Maybe you provide better service, guarantee your work, faster service, better communication, free upgrades, bulk discounts, or whatever else you do that your competitor doesn’t. Maybe you’re an expert in your field and can support your product, while the other guy carries widgets as part of his product line but doesn’t know a damn thing about them.

Your value proposition will likely take some time to evolve and may continue to continually revolve. With our website business, we’re working with clients while we shape how we can add and scale our value. While right now, this sees us spending time on non-chargeable activities, we get to run experiments to see if certain services are viable to offer to all of our clients. Every client we work with has different needs and we end up working on a lot of non-website (and non-billable) work. We’ve sourced tradeshow booths, signage, business cards, done flyer design, fixed computers, swept showroom floors, and a million other things. Our main value is that we’ll do pretty much anything to help small business owners get started and succeed. Does that scale? Not in the slightest. But while we’re small and getting started, we provide a huge amount of value for our clients and we get to evaluate offering new services.

Know your customers and where you might find more

Talk to your existing customers or your potential customers. Ask them what makes them come to you for widgets in the first place and what keeps them coming back. While you’re at it, ask them if there is anything that would make them come back more often or tell others about you. Think about alternate channels that you might find new customers that you haven’t looked at before. Consider narrowing or widening your scope.

Engaging with your customers provides insight into how they view your products and services, giving hints at where to find more. You might sell a widget that prints dollar bills and find out a client uses them as a cheap doorstop alternative. Instead of being offended that “their using it wrong”, you may find yourself in the doorstop business too. Define these verticals as a means of targeting where to spend your marketing dollars.

What makes you passionate about your business?

One client set out on his own because his old employer rarely did right by their customers. He knew he could deliver better service, at a better price and would not have to lie to get their business. He’s a great craftsman, does top notch work and is one of the most honest guys in his line of work. Sure, his pricing is lower than anyone else in the city, but his value is in getting accurate estimates and schedules and no price shenanigans. As he starts out, things are moving slower than he wants it to, but he’s building a foundation for a business that will be there for decades if he so chooses.

I started myTooq because I felt that there was a lack of real solutions for small business owners to manage their own books without complication or year-end expenses to have their accountant track down and fix their mistakes. I love seeing small business owners transform from idealistic dreamers that think about making the leap, to the their first sale, to hiring the first employee, and hopefully to that point where money in exceeds money out. When the doors fling open on day one and no one comes rushing in, there is a sense that I can help people through that and channel the lows into making progress. I’ve been in that depressing low stage of business ownership and the only way out is to do something productive that works toward your goals. Helping SMBOs is what I love doing.

If you think back to why you started in the first place (or if you’re thinking of starting, think about why you want to jump into the unknown).

Where lies your risk?

All business ventures contain some element of risk. If you chase down the wrong path, make a big spend on a television commercial campaign and it flops, what will that do to your business? Are you better to focus all your efforts on one area of marketing or spread yourself to have many ‘lines in the water’? Can you afford to experiment. Ensure you listen to that little voice in your head when it comes to risk. It’s easy to listen to the big shouty voice that says “YES! RADIO ADS AND TELEVISION ADS WILL MAKE ME RICH!”, when you should give some credence to the little voice back there saying “but if they don’t, I’ll need a bankruptcy lawyer. Maybe lets look at other things too”.

Ideally, the value you add for customers combined with your passion and knowlegde will be the bedrock of how you market your business. Knowing where your risk is at will help eliminate high cost avenues of advertising and marketing and help you operate at a level where you can sleep at night and gain incremental results.

Lastly, never underestimate the power of word of mouth advertising. If you’re in a business that’s all about burn and turn, no amount of marketing or advertising will help you keep a business running in the long term. You’ll eventually run out of suckers and your reputation will precede you in all that you do.

If you’re in a business where repeat sales are rare due to the nature of the product or service, you need to wow the pants off of every client so they talk about you. If you install hardwood floors for a living, it’s not likely that you’ll be back in a few years to install new floors again (and if new floors are needed, they are not calling you this time around). Assuming you sell good flooring and do a great job of installing it, you’ll probably get some good word of mouth for the first little while. But over time, the floors are not new anymore and your smiling installer face fades from memory. Why not send a bottle of good quality hardwood floor cleaner out at the first couple of anniversaries of the installation with a handwritten note thanking the client for their business again? Maybe in year 8 or 9, you offer a discount on refinishing services and the cycle starts again. Even if you don’t see repeat business from the customer, you can bet that anyone that brings up hardwood with them will hear all about you.

And if you sell consumable items or services, the goal should always be to be the first and only place people would ever think of buying from. Always look at the long tail and never pre-profile a customer. The person buying a tiny widget today, may be the guy coming back to buy a thousand of them next week. Treat every customer as if your business depends on their loyalty. It does.

(Note: I’ve used advertising and marketing interchangeably throughout this post and I’m aware this is not quite right. The post was written throughout the day without proofing and requires a little more work. I’ll make some updates over the next day or two.)

Next Post: No-to-Low Budget Bootcamp

 

 

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One Comment on “MYSMB Part 1 – Assess Value, Passion, and Risk”


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