Be an Ethical Entrepreneur, Marketer, and Business Builder

Internet Marketing for Small Business – Commitment

In my Internet Marketing for Small Business series of blogs we reviewed the 3 pieces of your small business’ online presence:

  1. Traffic
  2. Website
  3. Commitment

We then discussed the 3 primary ways to get Traffic (Search Engines, Online Ads/Google Adwords, Viral Marketing) and of course reviewed videos explaining some basics of Viral Marketing, Search Engine Optimization and optimizing your Google Adwords campaigns. We most recently looked at some great tips for your website in my last blog.

The final piece to the puzzle and the item we’ll be reviewing today is the Commitment. The commitment is simply the visitors commitment to buy from you or to contact you for more information if you’re not selling any products online. Obviously we’ve been talking about the sales aspect of your website, not how it caters to current customers, so with that in mind, everything you do to your website should be geared towards that goal. Here are a few pointers for achieving that.

  1. Setup your website layout and design according to my last blog.
  2. Use the 4.5 points of marketing to address their questions and concerns.
  3. Offer them something for free in exchange for their email address.

Since the first 2 points were addressed in the last post, we’re solely going to focus on the third.

When buying a product, the primary reason people use the internet is to educate themselves by reading information about the product or service they are interested in. They may also be looking for the best value, but without knowing what makes a product or service valuable they’ll first have to educate themselves on that product or service. This is where you have the opportunity to set yourself apart. If you’re an online retailer, the best reason for someone giving you their email address would be to receive email notifications of special sales and promotions. However, if you’re a service or knowledge-based business, they can have many reasons for dealing with you. A few thoughts your prospect may have to consider would be:

  1. Your level of expertise – Can you fix their problem the right way the first time?
  2. Your history – If your business is less than 5 years old chances are you’re not going to be here in another 5 years.
  3. Your prices – Are they fair and reasonable for the services you deliver?
  4. Your credibility – What do your customers say/think about you?
  5. Your guarantee – If you turn out to not do what you told me, what do I stand to lose?

Now your website can do a great job of addressing most of that, however you need to hold something back. You need to not let the cat out of the bag on your expertise right away. Why? After all, that may be the most important thing to your client and what they NEED to know about you before making a decision. Exactly. Because of that, if setup correctly, your potential client will gladly give you their name and email address in exchange for you sharing some of your expertise with them. Read that sentence again and let it sink in for a minute. That’s your hook. If the rest of your website is setup in such a way to address the other 4 items (and any others you may determine your prospects want to know) then they’ll trust that you are an expert.

This is where you utilize an “opt-in”. An Opt-in is where your visitor opts-into your mailing list or newsletter. Obviously the key to getting someone to decide to sign up for your newsletter is to offer them your expertise for free in return. So once they opt-in, you email them a PDF or direct them to a web page where they can download a PDF providing your expertise. (Mailchimp.com can get you started with this for free.) This would be in the form of an article, whitepaper, special report, expose’, or research paper addressing your expertise. For instance:

  1. For a law firm – “The top 10 cost-saving questions you need to ask before putting down a retainer for a lawyer.”
  2. For an accountant – “The top 10 things your accountant missed on your last tax return.”
  3. For a plumber – “How to know if your plumber is more interested in your pipes or your wallet.”
  4. For a an auto-body shop – “The quickest way to tell if your body-shop repair estimate is accurate or if the body-man has been spending too much time in the paint booth.”
  5. For a photographer – “The 5 things a photographer must do to get the best picture of you – that have nothing to do with the camera!”

You get the idea. The goal is to provide a topic that is relevant and important to your visitors. Here are a few guidelines:

  1. Make it generic – Don’t say “top 10 reasons to do business with us”. No one is going to give you their email in exchange for a sales pitch. They’re looking for a “free lunch” by learning from your expertise.
  2. Set it up to paint a picture that only your business fits – This is, of course, the power of this sort of marketing. It allows you to define exactly what the perfect lawyer, cpa, plumber, beauty salon, etc. should look like. Make sure only your business can fit that definition. This is part of the way you can build value to demonstrate that your prices are higher but your overall value is unmatched.
  3. Provide some real expertise – We’re all smart enough to see right through a thinly veiled sales pitch. This is the kind of thing that will help them decide to NOT do business with you.
  4. Make it simple – Lay it out with a list or graphs and make it conversational. Write this copy, as you should with all marketing copy, as if you’re sitting across the table from this person explaining to them exactly what you’re talking about.
  5. Promise not to sell their email – Unless of course you do plan to sell their email. But I don’t really recommend that.

Now some of the great internet marketers have learned that providing a PDF in exchange for an email only gets you so far. Instead they setup automatic email responder campaigns with the help of sites like aweber.com. This basically tells your visitor they’re going to receive some level of your expertise once per week for the next 4 weeks or something along those lines. This keeps you in touch with them constantly and helps you get closer to Jay Conrad Levinson’s claim that it takes 9 communications to make a prospect a customer. This is the reason gathering an email address is so important to begin with. If Levinson’s research is accurate, your chances of gaining a customer because of one visit to your website are pretty slim. However, if they visit your website and then you keep in constant contact with them via email, now the tide has turned in your favor. 😉

To your success in gaining a commitment with your website, Bryan

How I nearly doubled profits the first year of my first business…

My primary business was purchased April 7th, 2008. My goal was quite agressive in that I planned to double the business in year 1 and starting “buying back my time” in year 2. In other words, in year 2 I want to figure out how to keep growing the business, supporting myself, and not having to work 60+ hours per week. To be more specific, year 2 goal is to eliminate myself from the business almost entirely… I’ll keep you up-to-date on how to make that happen but for now let’s look at the year 1 summary…

Increase in gross revenue of 17% due mostly to a mid-year acquisition of another bordering franchise. Not quite  what I had in mind, however my unaudited books are showing an increase in net profit of around 95%!

Better than I expected on the profit side even if the revenue side was a bit lower than expected. Overall, a doubling of gross revenue maintaining profit margins or a doubling of profit put the same amount of money in my pocket and increase the value of the business the same amount so you can’t argue with that. 🙂

So there are now 2 questions to answer:

  1. How did I manage to increase profits 95% in my first year?
  2. What would I do differently next time?

For this blog we’ll address how I managed to increase net profit 95%.

  1. I knew and watched the numbers. A few of the numbers I watch were listed in my blog on weathering the economy. Possibly the most important number at my business was the average revenue generated per day per technician. Nearly doubling that number has increased our profits a lot with zero increase in overhead.
  2. Converted our revenue generating team members to partial commissions. So the question that comes to mind is why aren’t they full commission? Because our small business can’t allow each team member to “specialize” enough to just generate revenue and I haven’t taken the time to figure out a better more “incentive-based” method of compensating.
  3. Cut overhead. We had 4 different phone companies and am still working on getting that down to 1. With Quickbooks we’ve been able to cut our accounting expenses a few hundred dollars per month. Started using Quickbooks Payroll to save about $100/month over Paychex or ADP with much more flexibility and control. Adjusted payroll to more accurately reflect work. In other words a few pay decreases were warranted.
  4. Cut costs of goods sold. We compiled a computerized list of all of the parts we sell and use (still a work-in-progress) to track who we purchase them from and have started shopping around for the best combination of price and quality for the parts we sell.
  5. Acquired another business to leverage economies of scale. The business was acquired cheaply with non-standard financing in a territory that had been underutilized and never marketed for a long time. We converted the Payables, Receivables, and Customer-service into our current location with minimal increases in overhead compared to a separate office and staff just for that small business.
  6. Cut personnel to only what’s necessary to be profitable. This will also be on my lists of things I would change. By nature I’m a “nice” guy so letting someone go is tough. However when it’s necessary it needs to be done quickly and decisively. The easy way to know if it’s being done is if you provide benchmarks, procedures, and responsibility lists and a team member isn’t holding up his or her end of the bargain it’s time to move on. This is also paramount if you want your business to run on its own.
  7. Created processes, procedures, responsibility lists and checklists. You can’t increase productivity and you can’t determine if your paycheck-for-work trade is worthwhile if you and your team members don’t have exactly what’s expected of each team member in writing. It seems sad that the team members who just go the extra mile without prompting are few and far between.
  8. Sold more to existing customers. We simply increased our marketing to current customers for upgrades and recurring service.
  9. Tracked marketing and started cutting out the bad. The cuts, yellow pages for instance, have just started since it takes some time to gather that data so in 2009 we should be leveraging our marketing even more. We also started using lead-tracking software to make sure no leads were getting forgotten or missed.
  10. Integrated real-time GPS units into service vehicles. “Inspect what you expect” is how one business owner phrases it. If you expect people to work 8 hours per day and not stop off for multiple lunch breaks or go home, it’s best not to temp them with “no one will ever know” opportunities.

Obviously a lot more things have been done – like integrating weekly team meetings and simply having management at the business every day – however those were the 10 that most quickly came to mind as I started reviewing the last year.

Beyond that, the absolute most important part of buying a business you’re going to grow rapidly is to wait for the business that needs a similar list of things to fix. If you buy a business that’s already “perfect”, which mine certainly is not and we’ll address that in the next blog, what choices do you have for growth? Your only options then become to increase prices, sell to more customers, or sell more products to current customers. And that stuff is hard work! 😛

In summary, if you’ve read through my blogs for the last year, you realize that last year has probably been the most educational year of my life. The nice part about that, compared with my years getting an engineering degree, is that I learned a lot and got paid to do it. 😀

To your success, Bryan