Written by Dave Lavinsky on Sunday, July 1, 2012
Fact: Most businesses never reach $1 Million in annual sales. They start small and end small. While you can certainly create a great income with lower revenues, depending on your net profit, it's also true that staying small does not necessarily ensure that your business will survive.
There are no guarantees in business or in life! Every entrepreneur is faced with the risk that all their hard work and sacrifice will go belly-up. You have two choices for dealing with this uncertainty-shrink and survive, or survive through evolution and growth.
If you increase your annual revenues, you'll find you have more options. You'll be in a more likely position to ramp up your advertising or fund your own growth. There's also the old saying, "Revenue covers a multitude of sins," meaning that you don't have to have a perfect business to do well, as long as revenues are high and cash flow is healthy.
If times get tough and people aren't buying as much, you'll have your savings to weather the storm, your revenues will have room to decrease without putting you completely out of business, or you may have the cash on hand to get aggressive and attack your way out of the slump. Plus, you'll make more from the sale of your business, after all your hard work.
Whereas, if you stay small in order to keep things more manageable, it is often just a case study in shrinking back within the confines of your comfort zone. Yes, I know, you're a fearless entrepreneur and nothing daunts you, but let's get real here. Everyone has a comfort zone, and the fulfillment of dreams rarely happens within their limited boundaries. You will have to grow ahead of your business.
So with the mindset of achieving and maintaining fast growth, here are some tips for forming a growth strategy of your own.
Start with the most common ways for a smaller company to grow. Each of these involves some risk, effort, and uncertainty, though less than with other growth strategies. I suggest choosing and working on one of these at a time to stay focused and minimize the risks.
These strategies are as follows:
1. Sell more to your existing customers
The growth strategy with the least risk is continuing to sell more of your existing products to your current customers. You can do this by offering upgrades, maintenance and service packages, or finding new ways that your customers can use your product or service.
If you can't figure out what else to sell to your customers, try this - ASK THEM. Yes, it's really that simple.
2. Attract new customers
The next straightforward way to grow is to sell more of your product to adjacent markets-customers in different cities of states, or business buyers in related industries.
3. Additional sales and marketing channels
This could mean making sales through new channels-such as online transactions if you're a brick and mortar store or selling clothing at fairs and shows instead of strictly online. Or, you can advertise the same products through different lead generation channels, like pay-per-click, direct mail, etc.
4. Offer new products
Creating new products to offer existing customers is one sure-fire way to make more sales without having too much risk-compared to making new products for new customers.
Think of new, related ways to meet their needs, or meet them better, or more easily. Try personalizing. Different colors. And, once again ask them what they want so you can give it to them!
5. Growth through acquisition
Another way to grow is to acquire other companies, though this is usually more capital-intensive. In addition, often-times mergers and acquisitions fail to deliver the full value predicted for them.
Nevertheless, keep your eyes open for opportunities to buy competing businesses (especially if they're in a tough spot), or buying out one of your suppliers and even distributors to pass the savings through to your bottom line.
I hope you choose to grow your business versus staying small, and that you grow through one of these proven strategies. The horizon is constantly changing, and changing with it is a reliable way to stay ahead of the game and in a strong cash position.
Suggested Resource: Would you like to know more ways to maximize the value of your business. And specifically to turn it into one that exceeds $10 million in revenues? Then check out Growthink's 8 Figure Formula. This video explains more.
Written by Dave Lavinsky on Tuesday, June 26, 2012
Outsourcing tasks and projects allows you to get more work done, more quickly and for less money. And it frees up your time to complete higher value-add tasks and otherwise grow your business. When outsourcing, a natural question arises as to when you should use several outsourced individuals or one virtual assistant, or both. This article will help you better answer this question, and allow you to outsource more profitably.
Of the many types of providers to which you can outsource work, there's a certain amount of leverage you can achieve by hiring a virtual assistant trained to do many things.
Would you rather hire and manage different people for each of these tasks?
- Administrative tasks
- Editing and posting blog content
- Keyword research
- Contacting customers
- Scheduling appointments
- SEO / Getting backlinks
- Customer service
...or just hire one person to do them all?
Something I have found very helpful is to write up a big, long list of every task that currently must be performed for your business to operate. Make it a list of ongoing, necessary tasks (not project-related tasks-more on that later).
Now go through the list and note which tasks are already handled by someone, which tasks could be done more inexpensively, which tasks you're currently doing yourself, and which tasks should be done but currently are not.
Doing this will leave you with a list of ongoing tasks that should probably be completed by a virtual assistant. So, what is a virtual assistant? A virtual assistant is a freelance service provider like any other, but who is more of a catch-all to handle numerous things for you (as opposed to an outsourced provider specializing in one thing, like design or computer programming).
Ideally, you can find one virtual assistant with previous experience doing everything you need done. If not, hire whoever can do the most and train them to do the rest. And/or for specialized projects, continue to hire individual outsourcers.
Virtual Assistants vs. Outsourcing Projects to Service Providers
There are pros and cons to both virtual assistants and individual outsourced providers.
One benefit of virtual assistants is that it's a lot easier to screen, hire, train and manage one virtual assistant for eight tasks than eight individual outsourcers for one task each.
Conversely, the benefit of an individual outsourcer is generally that they are well-trained in their area(s) of expertise. If you need a writer for example, you will probably get better quality work from a professional writer than hiring (or training) a virtual assistant who does a variety of things including writing.
Another difference is the length of time they work with you. Virtual assistants tend to be a longer, more ongoing commitment. Versus individual outsourcers who are often hired to complete just one task. Each of these scenarios has their benefits. Ongoing relationships cost more, but the virtual assistant often gets better with time as they learn more about you and your company. Individual outsourcers are only paid for the specific project they do, but there is more work to constantly find and educate them.
But with regards to cost, you can hire full-time virtual assistants in the Philippines for only $5 per hour, or $400/month full-time! So the cost might be very reasonable.
What should I have my virtual assistant do first?
The list of tasks you wrote up above can also be used when posting a project to hire a virtual assistant. These core tasks become their job description. As you think of new tasks your assistant can perform for you, add them to the list and train them to do it when the time is right.
You can't teach them everything all at once, so you've got to have a planned and orderly
system for training your assistant. Number each of the tasks in the order in which
you want to train them.
I recommend numbering only the top five at first so that you will stay focused. To number more is a waste of time, and your priorities might change in the meantime, anyway.
When you're almost done with the first five, choose a new top 5 tasks to teach, with the current #5 becoming the new #1.
There are three methods you can use to prioritize what to teach your virtual assistant and when:
1. Based on Frequency
Using this approach, the first things you would train your assistant to do are the ones they will be responsible to perform every day.
This makes sense, because these tasks are needed most often. And, they will begin to establish a daily routine. These tasks will become a habit, which will ensure they are done on time, every time.
Once these are taught, you can then move on to items that are to be done weekly, and then monthly. Think of training your virtual assistant in things that happen regularly as the foundation. Once it is laid, you can build upon it by adding other tasks that arise from time to time.
2. Based on Time Consumed
The first things you would teach your assistant to do using this approach are the ones that currently take YOU the most time to do. By doing this, you free up your time a lot faster.
Some of these tasks take a long time to train; others will only require an hour or so. You may prefer getting these monkeys off your back sooner, and like this method better.
3. Based on Importance
There are some things that each of us really needs to do, but we just can't seem to find the time to accomplish. You may wish to teach these to your assistant first in order to make sure they get done.
You may also decide on some combination of the above. Use your judgment, and don't put
off things that should be trained just because they take a few hours to teach properly.
While outsourcing can certainly save you a ton of time, there is still some unavoidable work on your part to get it set up for success and to manage and coach your virtual assistant over time. So the point is...you have to put in the hours and pay the price in order to get top-notch results consistently.
But would you spend one hour to save ten? Ten hours to save one hundred? I hope so. Taking the time to properly train and manage your virtual assistant and individual outsourcers is one of the best ROI's you'll ever see in business-but there is still an investment to make.
I'm hammering this home because I see a lot of entrepreneurs hiring someone, throwing them into the work, and then getting busy again with other things-wishfully hoping that everything will just run on auto-pilot from the beginning. It won't.
Suggested Resource: If you don't outsource, you can't compete. The math is simple...if your competitors are outsourcing and only pay $X to complete a task, and you pay $3X, $5X or $10X, your competitors will eat your lunch. You simply must outsource to stay competitive. Outsource the right way using Growthink's Outsourcing Formula. Learn more by clicking here.
Written by Dave Lavinsky on Friday, June 22, 2012
In today's business environment, you absolutely must outsource to stay competitive. No, I'm not talking about outsourcing your core competencies. But I am talking about outsourcing those business functions and activities that someone else can do faster, cheaper and/or more easily than you.
Unfortunately, when they start outsourcing, most entrepreneurs and small business owners make several mistakes. In this essay, I'm going to outline the 10 most common mistakes made when outsourcing work or projects to freelancers or other service providers not on your internal team [note that I use the term "freelancers" below to describe folks to whom you outsource].
Feel free to print this out as a quick checklist to run through when setting up your next outsourcing project. For each of these, think of how you will address or avoid these mistakes in advance to ensure smooth sailing.
Mistake #1: Define the task/project clearly
This is something I would do before even posting the project [i.e., to find the outsourced candidate]. Because you need to really understand the project in order to write an accurate job description. The process of defining the task/project clearly will also help you to estimate the costs, time frame, and skills needed from the person you hire.
One way to do this is to write down a very clear and descriptive explanation of the task. Another way is to record yourself speaking the description. Finally, another great way is to take a screen recording of yourself doing the work you wish to outsource (or taking a video of you doing the work if it's not computer based). Try using a free screen recording program like Jing to make a quick video.
Mistake #2: Not having a well-planned estimate of costs
The more clearly you can define exactly what you need done by breaking it into parts, the better you can estimate how much time it will take - and therefore how much it will cost at the person's typical hourly rate. You don't want to just hand a bunch of work to someone and then get surprised when you get their bill and/or incorrectly assume they took too long to complete a project.
If the project you need completed is something that requires specialized knowledge, describe the project to potential freelancers and get their opinion on what is really involved and how long it should take. If there's no typical hourly rate for the work they're doing, then just get a solid estimate of the total project cost and consider it to see if it makes sense compared to the revenue it should generate (or costs it should save).
Mistake #3: Know your timeframe for starting and finishing the work
If you've ever provided services for a client in a rush, you know how stressful it can be to drop everything at the last minute and make their emergency yours. The people you outsource to are no different, and it will benefit you to plan and begin things in advance and not at the last minute.
So for whatever work it is you want to do, figure out how long it will take and when it absolutely has to be completed. You'll come out with a rough idea of when the work needs to commence. Then, give yourself a week or two before that to post projects, screen candidates, and choose the right person...maybe more.
Mistake #4: Hiring someone without enough experience
Nothing is worse than the blind leading the blind. When I hire someone to do something that I do not know how to do personally, they need to know how to do it - period. They need to educate you on their chosen skill set, not the other way around.
Your role is to describe the end result you want, ask for and listen to their suggestions, and rely on their expertise and talent to achieve it according to your description.
Mistake #5: Not screening or testing enough freelancers
In choosing the right candidate, I would rather have more options to choose from than fewer. If you run a project only on Elance, for example, you are only going to get a few providers from Elance bidding on your project. This might be enough, but suppose you posted this same project (copy and paste) on Guru and ODesk as well? [Elance, Guru and ODesk are 3 of my recommended websites for finding freelancers and outsourced help]
I would rather have 30 applicants and choose from among the top three than to have 10 applicants and choose from among the top one.
Also, your goal is to build a list of qualified people to contact whenever you need them for projects or ongoing work. So even if you post a project and only hire one person, keep tabs of the runner-ups so to contact or test later on for future projects.
Mistake #6: Choosing someone with no room to grow
If you are outsourcing a project (e.g., graphic design) that you know you'll need again in the future, you want to have one eye on the present project and your future needs. Think about what similar services you'll need in the future and to what extent?
Or, if you have a freelancer build something that, once done, needs maintenance, then be sure to ask them about their work hours and schedule. Find out if they have enough time left for your needs in addition to their other clients. It's terrible to go back to a great freelancer later on who is apologetic but too busy to help you.
Mistake #7: Outsourcing your weakness
If your business is weak in a certain area, it may also be weak at managing someone performing the work outside of your company, too. Think about it... every worthwhile endeavor requires some basic knowledge and strategy, as well as some understanding of how to perform the work and measure the results.
At least get this working knowledge upfront so that you can be effective at managing your freelancers. It doesn't matter if someone else is doing the work or not, if you don't start the project with a clear outcome and strategy, and continue to stay on top of it (not washing your hands and hiding somewhere) it will fail regardless of the skills and intelligence of your outsourcers.
Mistake #8: Lack of communication
You heard of management by walking around... well, this here is called seagull management. A seagull manager will be gone for days on end and suddenly come sailing in with the wind, squawking and dropping tons of work on everybody, and then flying away never to be seen again for days or weeks on end.
What seagull managers don't realize is that you have to constantly be there for your team. This doesn't mean it needs to take a lot of time, but they would appreciate fast responses just as you like them from others.
Again, just because someone else is performing the work does not mean you can abdicate your responsibility to support and manage them to achieve the result.
Mistake #9: Insufficient feedback
If you plan on using your freelancer for more than just a few quick tasks, then you will want to invest in your relationship with them from the beginning. Your job as a manager is to coach them and help them to do things exactly as you want over time.
You should expect them to make mistakes and encourage them to fail quickly so you can give feedback and show how to do it the right way. Don't be a perfectionist, and don't make them afraid or hesitant to admit challenges or mistakes and then blame them later.
Many managers just assume that the people who are working for them can read their minds and know all the little details without being told. This is not true, even when the person is highly intelligent. It's your job to communicate clearly and often.
Mistake #10: Underutilizing hired talent
This probably keeps most entrepreneurs and small business owners from outsourcing in the first place. As entrepreneurs, I have to admit that we can have some pretty big egos. While this helps in the vision and confidence departments, it can also lead to the "no one can do it as well as I can" syndrome.
Maybe not, but I would still rather have 10 people who are 80% as good as me doing 90% of the work. Think about it! Besides, with proper coaching and support, you can make a good person great-as long as they are coachable and motivated to grow.
And even when you are outsourcing work to someone, don't miss opportunities to give them even more work once they have proven themselves with some smaller task. I like to list all the work required on a consistent basis and check the sub-items off as I outsource them, one at a time.
Implement these suggestions and your outsourcing experience will be a lot more effective and hassle-free!
Suggested Resource: If you don't outsource, you can't compete. The math is simple...if your competitors are outsourcing and only pay $X to complete a task, and you pay $3X, $5X or $10X, your competitors will eat your lunch. You simply must outsource to stay competitive. Outsource the right way using Growthink's Outsourcing Formula. Learn more by clicking here.
Written by Dave Lavinsky on Sunday, June 17, 2012
Normally, if I were to ask an entrepreneur or business owner how they could double their sales, they'd propose increasing their sales force, trying to get customers to buy twice as much, or doubling their advertising budget.
But often, a superior strategy can get the same results with less effort. In this case, your pricing strategy might be this superior strategy.
There are several pricing strategies to choose from when offering a new product/service or trying something new with one you're already selling.
Making even minor price changes to find the "sweet spot" where the most people will buy can massively increase your results. Think back to economics class, when they covered the Price Elasticity of Demand. Now, if you're still awake, remember how you might raise your product's price down or up and lead to an increase in sales.
Price it too high, and your margins will be great, but you'll generate less revenue because fewer people buy it. Don't price your product too low, for obvious reasons, but don't be afraid to try going lower (even temporarily, like during a promotion) and observe the results.
Test this enough and you'll find the sweet spot that works the best for customers and your bottom line.
Changing your price (and therefore the number of units you sell) can affect your other expenses, so take these into consideration and work it to your advantage.
For example, say you lower the price of your widgets and sell many more of them. You have more sales, but the cost to create and deliver your widget stays the same (meaning lower margins on each widget sold).
This would be a great time to negotiate a volume discount with your vendors and suppliers, since you are bringing them more business. Then your customers get a lower price, you make and keep more revenue, and the vendor does more volume-everybody wins.
Another key consideration is your customers' perception of your product-or, more importantly, how you want it to be perceived. If you price a premium item too low, customers may not believe the quality is good enough. They are accustomed to paying more to get more-and trust me, this is not necessarily a belief you need to go about changing.
On the other hand, if you price something too high, customers will go elsewhere to buy it for less, unless it has something very unique and beneficial.
Some additional pricing strategies to consider are ...
Based on Competition
With this strategy, you'll need to gather the top competitors' prices to use as a starting point.
Determine if they are positioning their products to be on the low end, high end, or right in the middle, and compare that with your own positioning strategy. Also assess whether their product or service is of higher or lower quality than yours?
Consider market trends and your product or service's value, and either price it a little under or a little over that of your competition. Having one or two advantages over the competition can lead to more sales, especially when the price is near the same as those with fewer benefits.
Based on Cost, Plus Markup
In this strategy, you determine your product or service's costs to create and fulfill, and then choose a price above this amount based on the gross profit you want to make when selling each item.
Loss leaders are products or services that you offer at or below your cost, in order to attract more first-time customers who you hope will buy higher-ticket items or a variety of items over time.
The hardest sale to make is the first one, so sometimes it's wise to make the offer so irresistible (by undercutting the competition) that you get to start a relationship with more new people-knowing that you'll recoup your money in the future.
My advice is to also have a plan for what you will upsell them, when, and how. Ideally, it will be as soon after the time of the first purchase (or perhaps as an upsell or cross-sell at the same time as the first transaction), so your cash flow is not affected as much.
Higher Perceived Value
Some products come out of the gate with higher prices, to take advantage of the premium image and psychological positioning. Make sure the quality really is high when you do this, though it doesn't have to be the absolute best product on the market.
Make sure you don't arbitrarily raise the price of your existing products, because people will note the change and not see the justification for it.
Also called "liquidation sales," you can try this strategy when you have excess inventory. Your goal here isn't to generate the most profit-it's to minimize your costs of continuing to store the items, or throw them away. Though it isn't a long-term strategy, it can get you out of a cash flow crunch when needed and/or clear out old inventory.
This is a way to reward people for making larger purchases from you. Offer discounts on bulk purchases, such as "Buy two, get one free." Or, make special deals with the repeat customers who bring you the most volume.
Like the above, but applicable when a customer buys several different products from you-not several of the same ones. You can offer these bundles and their pricing at the time of the sale to sweeten the deal, or you can make it the focus of a marketing campaign.
Some speakers and trainers package together a group of related books, courses, and seminars so that the total price if you buy now is much less than getting them all separately, or at different times. It's a great way to build urgency into your offer, if customers know they'll have to act now to get the savings.
You see this pricing technique used often with services, or technical products like software and apps. With this, you sell the same product in two or three different versions. The trial version (often called Basic) is usually priced very low or is even free. Think of it as the loss leader that gets people in the door and wanting to expand to the full functionality that it offers (often called the Premium, or Gold/Platinum version).
You would then offer upgrades or additional features and services at a higher price. A good example of this would be Tom's Planner-a simple online software for making charts to schedule project-related tasks. You can create one chart with the free version (I used it to make a few charts, one at a time) or upgrade to the paid version where you can make unlimited charts. Think about how you might apply this to your products and services-especially the ones with monthly, recurring income.
So there you have it -- eight proven pricing strategies at your disposal. Make smart use of these pricing strategies and your bottom line will soar!
Suggested Resource: Want more ways to increase your profits? Check out our "Double Your Profits" training. You'll learn tons of quick, proven tactics that will grow your revenues and profits right away. Check out the "Double Your Profits" training here.
Written by Dave Lavinsky on Tuesday, June 12, 2012
In the great movie "A Bronx Tale," protégé Colagero asks the gang leader Sonny, "Is it better to be loved or feared?" Sonny replies, "That's a good question. It's nice to be both but it's very difficult. But if I had my choice, I'd rather be feared. Fear lasts longer than love."
When running a business, some entrepreneurs don't know how to act. Some think they get the best results when they are feared. Others want to be loved, but are concerned with being seen and/or becoming a pushover.
In either case, including variations of each (e.g., you desire to be slightly feared), entrepreneurs who run companies must mentor their employees in order to get them to excel.
Typically, when people think of mentoring, two things come to mind-someone outside your company showing you the ropes, or some kind of apprenticeship program. However, I believe you can and should be a mentor and friend to your own employees and team, and not just a boss. This article will show you what mentoring is, why it works, and who in your organization you should spend time mentoring.
My favorite definition of mentoring was created by Bozeman and Feeney, who defined it as "a process for the informal transmission of knowledge, social capital, and the psychosocial support perceived by the recipient as relevant to work, career, or professional development...
...Mentoring entails informal communication, usually face-to-face and during a sustained period of time, between a person who is perceived to have greater relevant knowledge, wisdom, or experience (the mentor) and a person who is perceived to have less (the protégé)."
So How Do I Mentor My Team Members?
A leader who is also a mentor cares about their protégés and teammates, and approaches work from the eyes of a servant, not a commander. They know that educating and improving the skills of individual team members will help them and their company be happier, more productive, and more successful.
Mentoring also adds a degree of friendship and affection to the workplace. This makes work a lot more pleasant for all employees, and also makes for a work environment that is more conducive to learning, admitting mistakes, and personal growth.
To mentor someone, you should invest time with them one-on-one in order to:
1) Teach them their job position's skills
2) Assess what they need to improve and measure their growth
3) Infuse leadership in them, so they are more empowered to solve
problems and figure things out on their own without waiting for your answers
Why the Need for Mentoring?
Mentoring has been shown to have a positive effect on one's career. One study by Gerard Roche (1979) found that mentored employees were more satisfied with their work and careers than their non-mentored counterparts.
It has also been found that mentoring facilitates the socialization of new hires into the organization, reduces turnover, minimizes mid-career adjustments, and enhances the transfer of the entrepreneur or business owner's vision, knowledge, and values.
These are the exact things you want - better, happier, more skilled employees who are committed to the vision of your company! This is why mentoring is such a high-leverage practice to include in your leadership activities.
Who Should be Mentored?
The traditional wisdom is to invest the most support and training in your best and brightest employees. But Delong & Vijayaraghavan (2003) reported that it's a wiser move to support the large middle-base (your team's B-players):
"Like all prize-winning supporting actors, B-players bring depth and stability to the companies they work for, slowly but surely improving both corporate performance and organizational resilience... They will never garner the most revenue or the biggest clients, but they also will be less likely to embarrass the company or flunk out... these players inevitably end up being the backbone of the organization."
This makes sense to me, however, I prefer to invest more in the hiring process so you only hire "A" players. Then, you can mentor your "A" players and turn them into "A+" players that allow you to dominate your market.
As the leader of your business, you are more than just the boss, the visionary, the founder, and CEO. You also play the role of coach and mentor for your team. Because you cannot mentor everyone in your company, particularly as it grows, choose 5 or so employees that you can comfortably mentor. And then have them mentor 5 employees beneath them. Etc.
At times in your business, you'll have to be a player yourself in order to score points, win the game, and get results. But over time, you'll see your time allocation changing to include less time spent "playing," and more time spent coaching and mentoring your players to perform under your direction.
Written by Dave Lavinsky on Tuesday, June 5, 2012
Hopefully you collect your customers' (and prospective customers') email address so you can send them tips, announcements, and special offers. Because email marketing is a highly effective way to stay in touch with your customers and generate revenues.
Depending on what emails you send, they can lead to customers calling you, buying something online from you, walking into your store, telling a friend about you, becoming more interested in purchasing from you, etc.
But, most entrepreneurs don't achieve these results. Why? Because they don't methodically track and improve their email marketing tactics.
Rather, to succeed, you must track certain key metrics and modify your strategies based on what you learn. Fortunately, tracking these metrics is simple using most email delivery/management services like ConstantContact, iContact, aWeber, etc. These services all have a tracking section where you can look at previous emails to see their delivery rates, open rates, and clickthrough rates.
Here are certain elements you must track.
You might think that if you have 1,000 people's email addresses and press "Send," that 1,000 emails will all arrive in the Inboxes of those people. Unfortunately, it doesn't happen that way. Emails don't all get delivered because they get sent to Spam folders on accident, get lost in transit, and for other reasons.
Typically, 5-10% of your emails won't get delivered. To improve deliverability, make sure people get removed quickly (or automatically) when they unsubscribe from your list. Also, don't send out irrelevant emails. Both high unsubscribe and low open rates can hurt your email delivery through certain email providers that your subscribers use (e.g., Gmail, Yahoo mail, etc.).
Your email management service will tell you how many emails were opened, and what percentage of the total delivered emails that number represents.
Your open rate can vary a lot-mostly depending on the subject line. That's what people read in their inbox to decide if they want to open the email or not. You've only got about 55 characters (depending on the recipient's email provider), so choose your words carefully and persuasively.
If you send out 3 emails to promote a product of yours, and notice that more people opened one of the three than the others, it suggests that the headline was more effective. This would be a subject line to reuse in the future, or add as an autoresponder message that every new subscriber receives.
Or use the same language in your subject lines as in ads you run to generate leads. After all, you know it already gets the attention and interest of people in your target market.
Importantly, if you see your email open rates go down over time, it means you are not providing your subscribers with value in your emails. And as a result, people stop opening them. The ideal is for subscribers to be excited to open your emails each time they arrive.
Your email management service will also show you how many recipients clicked on a link (or links) that you placed in the email, and what percentage of opens and total recipients this represents (this "click" rate is known as the clickthrough rate).
You want to know your total clicks so you can estimate in advance how much traffic you'll get to the webpage you're promoting. And the percentage of people who click after opening is the main indicator of how persuasive the language was in your email body.
Another idea: Try sending an email with the same subject line to three groups of recipients, but use a different email body in each one. The open rates will probably be the same (because you used the same subject line), but the clickthrough rates will give you an apples-to-apples comparison of which email copy was more effective. Cool, huh?
When people click on your link, they will all visit the webpage to which you chose for them to be directed. What do you want to happen once they get there? Do you want them to read a blog post? Make a comment? Share on Facebook? Buy something?
Whatever you choose, there's a metric involved and a way to track it. You can use Google Analytics to see how much time visitors spent on your page (hopefully several minutes if you want them to read a post). You can count the comments on your blog. Your Facebook "share" button will tell you how many people shared your page. And your shopping cart service will tell you how many people made a purchase from that page. And if your goal was to get phone calls coming in, you can count the phone calls and ask what prompted them to call.
So know what actions to measure, because that's the whole purpose of sending your customers or readers email in the first place.
Importantly, if your goal was to generate sales, then you'll have a dollar amount for the revenue created as a result of sending out your email.
If you email 1,000 people and make $100...congratulations! You have revenue of $0.10 per subscriber. Now imagine if you had 10,000 and ask yourself if it's worth spending a few hundred or thousand dollars on building your email list.
In addition to these metrics, I track:
- New subscribers: how many new people have joined my email list
- Unsubscribes: how many people unsubscribed to my list (and then I look at the recent emails I've sent to see what may have caused this)
- Email revenue per subscriber per month: this is an important metric. If you know, for example, that the average email subscriber is worth $1 per month to you, and the average subscriber stays for 12 months, then you can consider marketing tactics to build your email list, and perhaps pay $1, $2 or even $6 or more per subscriber since you know you'll earn a good return on this investment.
Email marketing is a highly effective marketing tactic. But, you must track your results carefully and improve based on this market feedback.
Suggested Resource: Want to learn my complete strategy for methodically maximizing the success of your email marketing, plus get more online traffic, leads, sales and profits? Then check out my Ultimate Internet Marketing System.
Written by Dave Lavinsky on Thursday, May 31, 2012
There are some marketing methods that take continual effort and persistence in order to pay off someday. This is NOT one of those. And for those of you without a website or for whom internet marketing can seem overwhelming at times...you don't even need a website to use this lead generation method.
I want to give you a quick tip today on listing your website (or just your contact information) in business directories so that people can find you online in ways they otherwise couldn't.
I'm not talking about ranking your site in the search engines, or paying for online ads. I'm talking about going to a website like Yelp.com, Manta.com, MerchantCircle.com, or other sites that list businesses by category with their contact information.
Not everyone searching for something on the internet is necessarily typing in a search for it in Google, Yahoo, or Bing. Sometimes people go to these directory sites and scan for local businesses there. Your goal is for them to find you!
And sometimes the pages about you in a business directory will come up in search results when people are searching for your keywords.
Not as good as having your actual website in the first page of results, I know, but getting your name and contact info in front of people's eyes is definitely a good thing.
Plus, being listed in an official directory can add credibility to your company in the same way that being listed in the yellow pages can set a local business apart from fly-by-night operations.
So without any further ado, here's the quick-and-dirty way to help prospective customers find you through this unique online marketing method:
Step #1: Determine your outcome
You've got to begin with the end in mind. Why are you going to list your business profile on these websites-for backlinks? Or do you want direct traffic from the sites' visitors?
Let me explain...If you list your business information on a directory (I'll describe how in a minute), you will be asked at some point to type in your website address (URL).
Your goal might be to have people find you in the directory and then visit your site at some special page for visitors (called your "money" page, which could be your homepage, your best-selling product's page, or a page designed to collect email addresses or elicit a phone call). If this is the case, then just enter in the URL of that specific page.
But, if you're listing your business in directories to get links to your site to rank higher in the search engines, then you would want to use the keyword you're trying to rank for in the business profile, the tags, and in the link to your website.
This latter method is done assuming you have a search engine optimization (SEO) plan in place, and know what keywords to rank your site for, and how. I can't explain all of that here, so if you're not currently trying to do SEO, then I suggest you just enter the URL of your "money page."
Step #2: Create a list of directories to submit to
I've already done this for you. I put together the below list for you of the Top 23 business directories for local marketing. Copy them into a spreadsheet, or print them out and check them off as you list your business information on each of them.
1. Yahoo Local Listings (listings.local.yahoo.com)
2. Switchboard Super Pages
5. Bing / MSN Local Listings (bing.com/businessportal)
19. Google Profiles (profiles.google.com/me)
Step #3: Enter your business profile into each directory
The task now is to list your business' information manually into each directory, one at a time. This is as straightforward as it sounds-find each site and look for a "list your business" section on it somewhere. Then follow their directions to set up your profile.
You'll enter your business name, address, phone numbers, emails, website, business category, and can often write a description of what you do. I would store these in a Word document somewhere and paste them the same way each time.
This is very simple to do but also very tedious in large amounts, to be perfectly frank. That's why I gave you a list of the top 23 to start with (there are over 200 total). Take 5 minutes after reading this to pick a free one and list your business there.
That wasn't so bad, was it? Now, for the rest of them, you can block out some time to knock them all out in one sitting, do one a day for a month or so, or pay an assistant or contractor to set them up for you by pasting in the business information you give them.
Step #4: Track your results over a few months
When you've listed your business on these 23 directories, you can sit back and do nothing and will probably see some great results within a few months.
Or, you can add to your list of directories and list your site on more of them. It's up to you. But whatever you determined your desired outcome to be, find a way to measure it. If your goal was direct traffic, then you'll want to use Google Analytics or your website's tracking software to see how many visitors came from each of the directories over time.
If it was worth it, go get listed in some more directories. Then evaluate if they were worth it. Keep this up until you start to experience diminished returns-meaning that the directories you're getting listed on have very little traffic and are no longer worth the time to get set up on them.
But worst case, follow these directions and in a few hours, you'll be visible in 23 more high-traffic places on the web than before. No need making it more complicated than it is...just do it!
Suggested Resource: Want to learn my complete strategy for methodically maximizing your online traffic, leads, sales and profits? Then check out my Ultimate Internet Marketing System.
Written by Dave Lavinsky on Sunday, May 27, 2012
To help you to be more productive (and stress-free) during this new era of "crowdsourcing," I put together a list of 23 websites and services that let you harness the power of the crowd, or otherwise help people more effectively work together through the Internet.
Most of these are hubs that brings a wide variety of people together from around the world with some sort of value to exchange. It's amazing to see how this has been done in matching freelance service providers, and now business funding from multiple donors online.
What's also interesting is to see how specialized a lot of these sites are. It used to be that Elance and Guru were the only two places to go to hire people. Now it seems there is a site for every specific kind of niche freelance needs, as you'll see.
So here are 23 virtual platforms and tools that are gaining in popularity and also stand out for their uniqueness, ideas they provoke, or just plain being cool.
- Elance, Guru, and Odesk - These are the 3 old favorites for finding contractors that still got it. I suggest posting a project on each of these and hiring the best from among the total responses.
- OnlineJobs.ph - A subscription site that gives you access to hiring skilled workers in the Philippines directly, often for $300-400 per month full-time!
- Amazon's Mechanical Turk - this is a marketplace where you can request tasks requiring human intelligence-tasks from getting questions answered to writing product descriptions for you.
- Fiverr - It amazes me all of the things you can get from people here for just $5. Professional voiceovers, fast logo designs, and all kinds of writing and search engine marketing gigs are available here.
- 99Designs - a great place to get multiple designs or logos made BEFORE choosing a provider to pay. This is valuable if you've ever paid someone to make a design you didn't like.
- Hatchwise - This site is nearly the same as 99Designs. I've used them both but have no real preference. Both are worth checking out.
- Etsy - this is the "Ebay" of handmade goods. Many entrepreneurs and small businesses test-market new products here first to see what sells better before investing more in promoting it elsewhere.
- Kickstarter - The largest crowdfunding platform for creative projects and endeavors. It uses an all-or-nothing funding system, where donors' funds will not be transferred until you reach your funding goal, and reimbursed if it isn't.
- IndieGogo, RocketHub, FansNextDoor - These sites operate just like Kickstarter.
- DonorsChoose - Backed by Oprah Winfrey and Stephen Colbert, this site makes it easy to donate (as little as one dollar) to any one of a long list of charities, with total transparency.
- 8-bit funding - a crowd funding site specifically for video game developers. Probably not your specialty, but see how there's a niche for everything? Google "your industry + crowdfunding" and see what's out there. Appbackr is a similar site, but is specifically for mobile phone apps.
- RetailMeNot - this is a site where you can get (or post) coupon codes for business services and supplies at significant discounts, like office supplies or even press release submission services.
- ChaCha - A question answering service you can text your questions to get answers on your mobile phone in a few minutes. It's helpful when you're super-busy and don't feel like looking something up.
- 37signals - Probably the simplest and best Customer Relations Management software I've seen for the price (Highrise) and also project management (Basecamp). With everyone on your team able to make and access notes, files, tasks, and emails about a customer or prospect, it makes life a lot easier.
- Skype - a must-download if you hire anyone overseas, for their audio or video chat feature, but also because their Instant Messaging system is just plain handy. It's nice having a record of every conversation with someone in one place, as opposed to a bunch of archived emails.
- TomsPlanner - A good way to manage projects if you're visually-oriented without having to learn to use Microsoft Project. By the way-if you're in business, you manage projects. It allows you to list action items and schedule them in order, in a printable Gantt chart that gets everyone on the same page about who does what and when.
- Quickbooks Online - If you're still using an older version of Quickbooks, consider getting the online version. The monthly cost isn't fun but it's worth it with the time you save. It imports your online bank transactions right into the register so there's not a lot of re-typing.
- SaneBox - This one will change your email experience by making it sane again-a lot faster than by organizing and checking a bunch of folders yourself. There are even timed folders like @SaneNextWeek and @SaneTomorrow that will make your emails re-appear when you're ready to deal with them.
Written by Dave Lavinsky on Friday, May 25, 2012
If you've been following the crowdfunding phenomenon, you've seen the swift rise of small businesses and entrepreneurs that have been getting funded by everyday people-through specific sites on the Internet that put it all together, like Kickstarter.com.
Instead of trying to find the one donor to contribute 100% of your funding, you can post your project online, spread the word about it, and may end up getting smaller donation amounts from tens, hundreds or even thousands of people.
The overall trend is that the people who fund or invest in crowdfunding ventures want transparency in their investments. They don't want to be far removed from their money as with stock market investing, where they have very little control, and insider information is not allowed in the decision-making process.
With a crowdfunding campaign, people of all incomes will be checking out your project and assessing whatever opportunity you offer to them in exchange. Importantly, just as you want to know the demographics of your customers, you also want to know exactly who your "typical" or "ideal" crowdfunding prospect is, so you can attract and influence them to invest in your company.
It's all marketing - identify your target market, position your offering properly, seal the deal!
So here are some interesting facts about what types of individuals are more likely to invest in your company via crowdfunding, according to an ADCI survey asking thousands of Americans asking them just that (FYI, ADCI stand for The American Dream Composite Index(tm), which is a survey conducted by Xavier University's Williams College of Business).
Keep these survey answers in mind when planning your funding campaign:
- People over 34 are less likely to provide crowdfunding dollars.
While those in their 40s and 50s are now getting on Facebook and social networks like never before, and making plenty of purchases online, they're not using it for social connecting like younger generations are - which crowdfunding is very similar.
- Females typically evaluate businesses themselves before investing, while men take greater risks and often invest based on the suggestion of a third party.
To me, this means that it's better to put all the information up for potential crowdfunders to see, for those who want to know the complete facts to analyze themselves.
- On a percentage basis, Caucasians are less likely to provide crowdfunding than other ethnic groups in the US. Also, Caucasians and Asians are more likely to invest in businesses they don't have an existing relationship with than African-Americans and Hispanics.
- People with incomes of $100,000 or more are most likely to engage in crowdfunding. [This does seem to contradict a little with the first statistic that crowdfunders are younger, but does point to the fact that young (aged 25-34), affluent people are the ideal crowdfunding candidates.]
But plenty of people with incomes closer to median ($40,000 or more) will still contribute, and there are many more of these individuals to reach through the Internet.
Now compare this demographic information with what you know about your existing or target customers. If they're people in their 20s and 30s, they may be perfect for crowdfunding your venture.
If not, it doesn't hurt to announce it to them anyway when the time comes. You also know people within your own personal and business network that you can announce your project to, as well.
And you might use it to determine the types of ads that you run and for whom they appear, should you promote your funding project with any kind of paid advertising. Or, you may find that the opposite is true - this is why we always test and track our marketing.
Suggested Resource: I hope you found the results of this survey on crowdfunding prospects' preferences to be helpful. I've identified even more strategies and tips to ensure you succeed with your Crowdfunding raise. I put them all together in a simple-to-follow program called "Crowdfunding Formula."
Written by Dave Lavinsky on Sunday, May 20, 2012
To be effective, your marketing efforts depend on targeting the specific customers (and potential customers) who will produce the best results for your business.
No company, no matter how big their budget, can afford to spend precious marketing dollars on too wide of a group of people. You just can't be everything to everyone.
You can create fast and cost-effective growth however by identifying your core customers and focusing your marketing activities on them - attracting them, selling to them, and providing the right customer support and retention.
This doesn't necessarily mean to focus on customers who buy the most, though that is the most important criteria in a top customer. There are also the "Influencers" who are the most vocal or respected, and spread the word about you to others - very valuable, even if they don't buy more than other customers.
Who are Your Top Customers?
It's easy enough to tell which customers of yours buy the most. Look at sales receipts or customer information to see who has made the most purchases, or the largest dollar amounts.
Sort out the 20% of customers who have bought the most from you over time, and that's your target group to which you want to focus your marketing (mainly to find more potential customers like them).
Then gather whatever other information you have about these customers and see what they have in common. While every customer is different, you'll notice there are certain trends and common characteristics among your target customers.
The easiest and primary information to get about these customers is their demographics - the directly observable characteristics that describe them (as opposed to psychological characteristics such as preferences, needs, motivations, self image, etc.).
Find out their basic demographic information
This includes basic facts:
- City/Zip Code
And also some less apparent information:
- Marital status
And if you serve business to business customers, demographic information will include information such as:
- Size of their business (in revenues and/or personnel)
- Purchasing/decision-making authority
How to turn your customer knowledge into gold
Time for a little alchemy...suppose you're going through your list of top customers and find that the majority are married women in their thirties who live within 5 miles of your store.
What can you do with these four demographic facts? To me, this information could be used in the following ways:
1. Running ads on Facebook that only appear for women, age 30-39, within your city or town. By knowing this information you won't have to pay for clicks and traffic from people who are less likely to buy.
2. Using signs, flyers, or some other kind of print advertising just within the 5-mile radius of your store. This would further saturate your business area and make your potential customers more likely to buy (as it takes 7 contacts with your company or ads on average to get a response).
3. Running an offer that specifically appeals to younger married women; for example, an offer to bring in one's husband and receive a discount, if this is applicable to what you do.
4. Selecting photos for your ads of people who closely match your target customers. In this case, you'd show women in their thirties who look like they live in your city, however that can be represented. Or pictures of happy couples, if appropriate.
5. Using direct mail to target potential customers. Chances are the 5-mile radius around your store is all in 1-2 zip codes. This information is very helpful if you're doing a direct mail promotion. When you buy a mailing list through a service like MelissaData or Listsource, you can select only addresses of women within your zip code. Why spend $.50-$1.00 or more per person if they're not as likely to respond, purchase, or love you?
6. Finding out where these women congregate and then going there or sponsoring and event. For example, if you determine that most of your target customers belong to the local PTA (Parent Teacher Association), sponsor a PTA meeting or event. As a related note, this is why I love airport lounges. Yes, it's nice to stay in a comfortable environment when waiting for a plane, but I love the marketing implications. That is, virtually all of the people I see in these lounges are corporate executives and salespeople that travel a lot. If your business' core customers fit this demographic, then hanging out in these lounges could be a goldmine.
7. Designing your store's appearance and layout with these women in mind. Your store would probably be colorful, aesthetically pleasing, and perhaps "hipper" and less formal than if most of your visitors were Baby Boomers.
8. Conducting research to learn what has been discovered about these women's preferences. Did you know there have been tests showing that women prefer ovals over squares, or purple over red? This information would be very useful when creating a logo, designing your store's outside and inside, and all of your promotional materials.
See all the ways you could utilize this information? This is why big companies spend a LOT on market research and surveys, and ask this information of customers when they buy online, etc. The more you know about them, the better marketing decisions you can make.
But what if I don't have this information about your customers?
Start with what you know
If you're interacting with customers face-to-face, you know their gender and can guess their ages. Your sales receipts will probably tell you customer addresses, so there's the city and zip code.
If you have collected business cards or know your top customers' demographics from memory, write that up as a working profile for now until you can do it more formally.
Then, start collecting their information
The best way to do this is to ask for it! Have a jar on your counter for business cards and a drawing/raffle. Or hand them a short survey form to fill out with 5-8 questions.
Or you can make simple online surveys using SurveyMonkey, SurveyGizmo, or Zoomerang, and then promote the web address where people can fill it out. It helps if you offer them some incentive, like a free gift or chance to win something.
It seems like fast food restaurants are getting pretty systematic now about encouraging customers to rate their experience online or by calling into a hotline.
And last time I went to a new doctor, they had me fill out a "Patient Information Sheet" asking for quite a bit about me medically, as well as about my demographics. See how doctors and dentists collect this so routinely? Make it a part of the way you do things and you won't have to remember.
Have you ever registered for something online and they ask for your company name, company type, your job title within the company, and so on? That's a great example of collecting demographics about a business, for B-to-B sales.
Make a demographic profile
Take your findings and summarize them on one page, for easy reference.
I know several copywriters who have told me that the best way to "get through" to people reading their sales letter or persuasive copy is to sit down to write with a photo of their "ideal" or "typical" person from their target market, and write as if speaking directly to that person.
Photo or not, at least write what you know about your top customers' common characteristics and print it out on a sheet of paper.
Make this profile a quick snapshot to reference that will represent them, rather than going about your marketing haphazardly, or in a less focused manner.
Lastly, do some research
As I said, you should also look for studies and reports online about how people of certain ages, genders, or marital statuses behave differently (from a marketer's perspective).
Lastly, in order to prevent false assumptions, if your main customers fit a certain demographic, for example they are mostly of a lower income, ask yourself if this was intentional, or if your previous marketing efforts just happened to attract them.
Executing on the ideas above will shed light on exactly whom you're working hard to serve, and will aid you in your efforts to find more of them and treat them the way they want to be treated.
Otherwise, it's "Round peg...meet Square Hole."
Here's to focused, targeted marketing...good luck!
Suggested Resource: Growthink's Ultimate Marketing Plan Template allows you to expertly create your marketing plan. Importantly, it allows you to quickly and easily build your target customer profile as explained above, and much, much more in order to dominate your market. Click here to learn more.