value proposition | The MarketFarm

Your business card is not an ad

Work boots are like soccer shoes in the sense that they both provide a protective covering for your feet. But if you play soccer or work in a steel plant, they are anything but interchangeable.

Your marketing materials are purpose built in the same way. A brochure isn’t interchangeable with a frequent buyer’s card any more than work boots are interchangeable with soccer cleats.

People who run their own small businesses are hard-working and busy. They typically seek to leverage time and money by applying one solution to as many problems as possible.

Many publications take advantage of that tendency by creating ads that are the same size as a standard business card. Business owners don’t have to think or spend to design an ad, and the publication gets a quick signature on a contract.

But just because it’s cheap and easy doesn’t mean it’s smart. In fact, it’s usually a waste of money. Business cards and advertisements are simply designed for different work.

The job of business cards is to make it easy for people to reach you. And that’s all they do. They work because you hand them out to people who have already expressed an interest in being able to contact you.

On the other hand, the job of an advertisement is to help people decide if they’re interested in what you do. It has to tell people what you do – and why you do it better or differently than others. It has to provide some call to action. It also may need to include a coupon or special offer of some kind to allow you to track results. And, of course, it must include at least a few critical bits of contact information.

If you plan to advertise, spend time thinking about how your ad must differ from your business card in order to really sell your product or service. If you’re not able to make that commitment, then find another way to invest in your business.

Because running a business card as an ad probably won’t generate results. But it will indicate that you ‘re someone who thinks it’s a good idea to play soccer in work boots.

Image courtesy of Luigi Diamanti/FreeDigitalPhotos.net

Make sure value-added really adds value

Value-added is the currency of the new economy. The idea is this: You do business by giving people what they pay for, but you gain and retain customers by adding a little something extra on top.

When the Eat ‘n Park restaurant chain gives each child a free Smiley cookie after dinner, that’s value-added. When UPS and FedEx provide tracking numbers so you can follow the progress of your package, that’s value added.

But beware of providing value-added that fails to add value. That can actually harm your business.

Here’s an example from the business-to-business world: On behalf of a client, I recently placed some small advertisements with a local media outlet. Ever since, I have received a weekly e-mail letting me know that my online customer profile has been established and that if I fill it out I will receive a free listing in some under-explained and over-complicated online system. They call it value-added; I call it extra work with dubious benefit for which I won’t be paid. But ignoring it leaves me with the inescapable knowledge that maybe – though not likely – I am shorting my client on some meaningful opportunity.

Here’s another, from the business-to-consumer world: The pharmacy placed four automated calls to my house the other day.

One was important; it directed my daughter to call the store about a question on a prescription she had transferred from another location. Over the next few hours she called several times and nobody ever answered the phone. In the end, she drove to the store and waited in a long line to speak to the overwhelmed pharmacist.

While she was there, I asked her to pick up another family member’s prescription that had been submitted electronically the previous day by the doctor. Not only wasn’t that prescription ready, nobody in the pharmacy could find any evidence it had ever come in. But 20 minutes after my daughter got back home, another robo-call arrived to announce the prescription was ready.

That phone call was intended to be value-added, but instead, it emphasized that the pharmacy is understaffed and has flawed processes – resulting in the inconvenience of another trip to the store.

By the time I returned home, there were yet two more calls – “courtesy” reminders that it was time to refill some maintenance medications.

I never asked for these reminders. In my household, we have a better reminder system: When the pill bottle is close to empty, it’s time to reorder. But the pharmacy decided its calls would add value, and opted us in to receive them.

I’m sure there is a way to change the settings for these automated calls. But why should that be my job? I didn’t ask for all this value-added in the first place. Aside from the momentary pharmaceutical chaos in my household, we’re basically healthy and view our business with the drug store as a transactional necessity.

This, of course, is what the pharmacy corporation hopes to change. By offering all this value-added service, it hopes to turn our transactions into a relationship.

It’s having the opposite effect; rather than figuring out how to change my preferences, I simply seethe in the background while the answering machine records each call.

The lesson is this: If you’re going to offer value added, make sure it really adds value. Otherwise you’re just spending money on something that actually harms your business.

Wants vs. needs? You’re selling both

Seth Godin, one of the best marketing bloggers I follow, says wants and needs are often confused. He writes:

That pays off for any marketer that has persuaded his market that they need what he sells. It backfires when those ‘needs’ are seen for what they actually are–luxuries.

I agree with Godin in both his point and his brevity. But in being admirably concise, he omits a noteworthy nuance. People are more eager to buy things they want than things they need. They’ll go to great lengths to pay the lowest price possible for actual needs – stuff like medicine, groceries, industrial consumables. But they’ll happily spend more on things they want – think wine, golf clubs, a redecorated office.

The point? While Seth Godin is correct that you’ll improve sales by persuading people you can fill a need, you’ll lubricate the sales process and increase pricing margins by convincing people that your product is also something they want.

As evidence, consider:

Dell v. Apple
Toyota Yaris v. Mini Cooper
Emerson audio equipment v. Bose

There’s a lesson for your marketing in that knowledge too.

First things first: What game are you playing?

Strategy before execution. This should be simple.

But it’s human nature to jump right into doing stuff before sweating out the big questions.

For example, a couple prospective clients have put off small, closed-ended projects that I proposed to help them align operating strategy and marketing. This in turn would help them answer such daunting digital communications questions as how to deal with social media, and what capabilities does the website need to offer?

It’s my suspicion that what they’ll really learn is the organization doesn’t actually have a unifying operating strategy. But in both cases, the reason given for delaying the little strategy project is that they first have to devote all their attention to the big website project.

I understand that building a new website is daunting. But it’s even harder if you don’t know what purpose the new website is supposed to serve. It’s like getting ready to knock the ball in the hole without knowing whether you’re playing billiards or golf.

That’s why strategy always needs to come before execution. Strategy tells you what you’re trying to do. The website will help you do it. But only if you tackle them in the right order.

Image courtesy of James Barker/Freedigitalphotos.net

The time has passed for revenue-enhancing digital products

A small B2B media company contacted me to talk about enhancing revenue by adding some new digital products to its portfolio. The company already offers a digital edition, business directory, email newsletters, web-seminars and a number of other digital B2B staples. Non-monetized but just as important, it has a reasonable Twitter following, a large group on LinkedIn and a Facebook page that is basically just a placeholder.

I’m sure there are more products the company could implement. It doesn’t have any mobile offerings to speak of, and its website represents first-generation internet thinking – a source of information but not of engagement and interaction. With a little bit of study and a few billable hours I could have made some recommendations.

Here’s what I told them instead: The opportunity to increase revenue by adding digital products has largely passed, and simply adding new products will probably hurt the business by:

spreading the editorial staff even thinner;
raising digital development costs;
over-running the sales force’s competence;
stressing customers, who don’t have more money to spend on new products and will be forced to decide which products to support and which to ignore.

In essence, trying to invigorate the company by adding more digital products is just going to lead to more fatigue for everyone – and at best provide only incremental revenue gains.

The real opportunity – and the only real option – is to use digital tools to increase the organization’s footprint and prominence.

Here’s the argument:

In B2B media, ad revenue and unit yields have been stagnant for a decade, and there is no reason to think that’s going to change for the better. As hard costs continue to rise, print circulations have been on a forced retreat. Publications that have maintained controlled circulation levels are doing so by cutting in other areas or – more likely – by winning market share and profits from other, lesser competitors. Neither is sustainable.

Given that it’s not economical to add print readers, the real value of a digital strategy is to present the brand to new people – either by expanding outside the magazine’s traditional market (taking a step upstream, toward the advertisers’ suppliers, for example) or its traditional geography (i.e. international).

That doesn’t mean simply launching a digital or iPad edition. These are passive – cool media in Marshall McLuhan’s lexicon.

But extended audiences demand hot media. They need to be actively engaged; they need learn for themselves how a media brand is valuable to them. Engagement at that level means creating a different kind of relationship based on interaction with community, expansiveness of content, and flexibility in the way content is applied. These are the strengths of digital tools – when those tools are skillfully and strategically applied.

In the real world, it probably means a pretty significant website overhaul and, more significantly, redeployment of staff and restructuring of sales compensation.

Editors have to stop thinking in terms transferring knowledge from experts to the readers – instead becoming moment-to-moment conduits for peer-to-peer communication. Less like network news anchors and more like a highly specialized cruise directors.

Sales strategy has to evolve too. It’s less about products and more about platform – how the media brand provides a fluid and organic conduit between the advertiser and the market.

These are not small changes to make, and this is not a short-term project. But it represents the difference between relevance, growth and prosperity on one hand; and retreat into a niche position or extinction on the other.

So much to do that nothing gets done

Many small business owners are not marketers. They’ll tell you as much.

People start their own business in order to do what they love and do well. Marketing becomes a necessary evil.

For many, writing is a chore. Or databases are a mystery. Or blogging takes too much time. Social media creates an uncomfortable blend between business and personal. Networking is superficial. Advertising is too expensive and doesn’t work quickly. Public relations is a crapshoot.

It’s altogether too time-consuming, too hard, too expensive. There’s so much marketing work to do that nothing gets done. And it’s easy to justify, because word-of-mouth is the thing that works the best anyway. But word-of-mouth isn’t real marketing; it’s luck. And while I’d rather be lucky the good, the real winners are both.

Aside from being under-capitalized, marketing paralysis may be the most common affliction among small businesses. There is a lot to know about marketing and too many easy reasons not to get started.

But marketing is now more accessible to small businesses than it’s ever been. Marketing rarely comes for free, but it’s possible to start marketing seriously without risking thousands of dollars like you had to do 10 years ago.

So here’s an idea: Try one thing. Instead of getting overwhelmed by all there is to learn about marketing, try choosing one marketing activity and focusing on it until you’re proficient – or at least comfortable.

What should you do first? I’d advise doing the activity that interests you most; you’re more likely to find the joy in mastering it.

But if you insist on being pointed in the right direction, swallow your pride and jump onto Facebook. Why? It’s a tool that can allow you to reach 1 out of 2 people in the United States – for free. If you coughed up $3 million to advertise on the Superbowl you wouldn’t reach that many people. Facebook is, simply, the largest media outlet in the world. And you can get started without spending a nickel.

What do you do on Facebook? Start by building a profile for your company, and then explore and experiment. We can discuss it in more detail another time. What’s important is that you do something. Anything.

Buy good equipment; take good care of it

Call this Rule #1 for life. Maybe it’s not the most important rule; it’s not the Golden Rule or even the Rule of 72.

Let’s call it the Hard Goods Rule: Buy good equipment and take good care of it.

Nothing provides better affirmation and aids in a better outloook than moving through the details of the day with equipment that works easily, well and with the rarest of failure.

If you need to buy a printer for your office, don’t settle for the $25 model that comes along as a premium with your computer. I’ve learned that lesson too many times. Go out and spend what you it takes to buy a durable, solid printer that runs and runs. Buy the features you need and just pay the price. If you find yourself leaning toward a cheap compromise, imagine yourself being late out the door and suddenly remembering a document you forgot to bring along. You’re in your winter coat and boots, leaning over the computer, the dog is barking because he thinks you’re going to take him for a walk, and you get a paper jam, or a message that the printer is out of magenta. With a cheap printer, this seems to happen 1 out of 2 times (thought it’s probably more like 1-in-5).

Visualize this and you’ll spend the good money.

A corollary to this rule is the Hard Goods Corollary: More power/fewer features.

Here are some tools and equipment to which the Rule of Hard Goods and Corollary apply:

Computer printer
Power tools (A drill shouldn’t drill just some stuff. For an extra $60 you can get a drill to drill any stuff. That’ll amortize to about $1.50 anytime you need to drill something really hard over the next 10 years).
Lawnmower
Computer (The reason people pay more for a Mac.)
Camera
Snowblower (If you want to wrestle with a piece of equipment, you’ll spend less and fare better against a snow shovel.)
Winter coat
Washer/Dryer (It’s all about power. Features break over time; a powerful machine runs forever.)
Stapler (Unless you never plan to staple more than 4 sheets at a time.)
Sporting goods (Whatever your passion – golf, tennis, baseball, sailing, jai alai – equipment that doesn’t go all the way just saps the fun. You may as well stay home to figure out what’s wrong with that g-d- Scanner/Copyer/Fax/Printer/Stickintheeye.)

There’s a place in the world for cheap stuff. If you’ve never been camping, never want to go camping, but you absolutely have to go camping just this once for one night with your son and the Cub Scouts, then go to Wal-Mart and buy the $39 two-man tent. You can buy a good tent for the next time you go.

Who’s really behind Steven Slater’s spectacular resignation from Jet Blue?

Once you get past the viral thrill of rehashing Steven Slater’s “bailout” from a career as a flight attendant that he could no longer stand to hold, the debate – to the degree that any debate is required at all – quickly gets to the question of who was more wrong?

Was it Slater, who cursed at his passengers, deployed the emergency slide on the Jet Blue plane to which he was assigned, and (worst) stole two cans of beer before escaping?

Or was it a still-unnamed woman passenger, whom he accuses of berating him and hitting him in the head with either the door of an overhead compartment or one of the bags in that compartment?

How about this third option: It’s the airlines.

They have to accept responsibility for helping to turn passengers into snarling beasts with overbooked flights, endlessly punitive fees, optimized fares that make no sense to consumers, and a practice of setting flight schedules that they can’t possibly maintain. Then they exacerbate the effect of all these insults by bombarding us with irreconcilable advertising campaigns to convince us how much we’re going to love the experience.

Further, they have to accept responsibility for their role turning flight attendants and other customer-facing personnel into recalcitrant and uncaring bureaucrats. The tools? Serial layoffs, confrontational union negotiations, low pay and a general disregard for their value. (When stranded near Chicago O’Hare during the 9/11 crisis, I met a dozen flight attendants from a handful of airlines – all of whom told me the hotel and meals were on their own dime during the unscheduled grounding.)

I’ve flown enough to know the truth of the matter. Some passengers, maybe even many, are simply boors who shouldn’t be out in public. And some flight attendants should probably find another line of work before they give their next safety briefing.

But for the rest of us, the airlines need to shape up. I can only imagine how complex and difficult it is to operate in this industry. Executives throughout the industry make incremental decisions that help the bottom line, and they are skilled at justifying why these decisions are in the long-term best interest of the customers.

But it’s simply not the case; there is no justification for selling a ticket and then notifying the passenger a day later that the flight is overbooked and an extra $25 will guarantee he isn’t bumped (this has happened to me a handful of times).

It’s simple really: Each airline needs to figure out a way to make money while treating passengers and employees like something other than refugees and wardens, respectively.

More magazines going mobile

According to MediaBuyerPlanner.com, Esquire (Hearst) and GQ (Conde Nast) magazines are now being offered in an iPhone edition. You can download them for $2.99 per issue.

This small step forward isn’t going to offset revenue losses from advertsing. Nor is it going to revolutionize the way people read magazines.

But it may evolutionize the way we read magazines and newspapers. It’s a small step but a great step.

GQ and Esquire are not alone. Time and BusinessWeek, among many others, have offered mobile websites – accessed through free iPhone and Blackberry apps. But the effort by Hearst and Conde Nast to monetize the use of smart phones is a step forward that the media need to take.

Is the effort any good? I don’t know. I’m a Blackberry user, and these brands aren’t available in a Blackberry version. So I can’t answer whether they’re worth $2.99 an issue. I don’t know how faithfully the print content is reproduced, or if it’s all re-jiggered for a better smart-phone experience than either magazine would seem to offer in its print edition.

But I’m anxious to give any such mobile publishing effort a test run. While people are wringing their hands over consumers’ unwillingness to pay for content, the research is starting to reverse. More and more surveys are showing the people have warmed up to the idea of paying for content.

I think the real problem is that when people need to know what that content would be. If you ask, for instance, “Would you read a newspaper on your smart phone?” most people are going to think of the newspaper they know, reduced to the size of a playing card. Who could be satisfied with that?

But I’m hoping GQ and Esquire will show us how their content can be repackaged and repurposed – providing one experience in print and another experience – different but just as fulfilling – on the smallest screen.

That’s where the next generation of media success will be found.