Entries from December 2009 ↓

The marketing process is often depicted as a funnel.  The funnel guides the consumer from the widest part, his awareness of a product, down to the thinnest part, the actual purchase of a product.  The funnel image is a great tool for describing the marketing process. However, for as long as I’ve been exposed to the funnel, I’ve had an issue with it: The sale of a product is not the end of the marketing process.  In fact, it’s a point at which a whole other process kicks off that culminates in either repeat business or referrals.

I struggled with how best to articulate this concept for a while until I stumbled upon Duct Tape Marketing’s blog post, “The Easiest Way to Describe the Marketing Process.”  In that post, John Jantsch explains the process, not as a funnel, but as an hourglass.  This was a “duh” moment for me, and I immediately decided that I needed to start using this imagery (thanks, John!).

The Two Halves of the Hourglass

The reason the hourglass works so well is because it’s basically two funnels, one stacked inverted upon the other.  The top half is the marketing funnel that we all have come to know and love/hate.  It deals with the customer acquisition part of the marketing process.  In the top half of the hourglass, we’re going out to a wide pool of consumers, and slowly guiding them towards the purchase of the product that we’re selling.  The tools to do this are the well-known marketing tools of advertising, PR, demoing, sampling, etc.

The second half of the hourglass is where this whole concept gets interesting.  The traditional funnel model, essentially says that once you’ve made the sale, your marketing job is over.  If you want to make more sales, go back to the top of the funnel.  The hourglass, however, acknowledges that there are better and more efficient ways to make additional sales.  As the consumer (or the grain of sand) passes through the middle of the hourglass he comes out on the other side in a process that aims to keep that customer coming back as a repeat customer and/or or to have that customer refer another customer to your product.

The second half of the hourglass is so important because the repeat customer, or the customer that will evangelize your product is the holy grail of any business.  Having every single sale come through the top half of the hourglass means lots of new customer acquisition, which is expensive, and time consuming.  Every grain of sand going through the top half of the hourglass is a single sale.  If you want another sale, you need another grain of sand.  When you get repeat business and referrals, it means that the first process yields multiple sales.  Every grain of sand through the top half of the hourglass can yield an exponentially larger number of sales. Some businesses do the second half of this process so well, that they can eventually forego the entire first half.  Isn’t that the dream?  When you no longer have to worry about finding new customers, and your customers instead find you, or just keep returning to you?

Expressing the Halves of the Hourglass

John Jantsch at Duct Tape Marketing expressed the different steps involved in the hourglass process of marketing in his own way, but what follows are the steps as I see them.  In some places, they’re simpler, in others more elaborate.  In the end, we’re expressing the same thing, but using different methods.

Awareness:  The consumer becomes aware of your product or service. At this point, all that’s happened is that he now knows it exists. If you sell purple widgets, this is the point where you need to make people aware the purple widgets exist and are for sale.

Interest:  The customer knows the product exists, and now he’s interested in learning more about it.  This is where you get to educate the consumer as to why he needs a purple widget.

Intent:  The consumer has now done his homework and knows he wants to buy.  At this point, he’s just looking for where to buy it.  The idea here is to make it as painless as possible for the consumer to buy your purple widget.

Purchase/Sale:  The consumer has purchased your purple widget.

Experience:  Now that the consumer has purchased your purple widget, you better be sure the experience he has with it is positive.  This comes down to making sure you can deliver on what was promised.  If you can’t, forget about getting return business.  Bonus points if you can overdeliver on what was promised.

Trust/Identify:  Assuming that the consumer is happy with his purple widget, you now have an opportunity to create a link with him.  You can forge a relationship with this consumer.  Some companies are doing this through loyalty programs, others are experimenting with social media to find new ways to connect with their customers, and the best companies realize that no matter what they do, this is all about delivering top-notch customer service and showing the customer just how much he means to them.

Repeat/Refer:  If you do the above steps correctly, the customer will gladly purchase from you again, and he’ll probably even tell his friends that they should purchase from you as well.  All of a sudden, all of the people he knows are getting their purple widgets from you.

Use Hourglass Marketing

So much emphasis is put on the top funnel in marketing because it’s the hard part.  You have to take non-believers, and get them to buy from you.  The bottom half of the hourglass is easy.  It’s just a matter of delivering on your promises, treating your customers like the valued people they are, and making it easy for them to come back, and to tell their friends how great you are.  Unfortunately, because we’re often so busy focusing on the tough first half, we forget about the second half.  The hourglass as a whole is important, and truly successful businesses know this.

If you want your business to succeed, use the hourglass.

Image courtesy of secubie.

A Story You Might Recognize

Bob used to work for a Big Corporation as a product manager, but he recently decided to make a change.  Bob joined the team at Medium-Sized Business Ltd. (MSB).  MSB is a dynamic, up and coming, growing manufacturer of custom-made, high-end wall units for home entertainment systems.

Bob’s boss is Joe.  Joe started MSB five years ago, as a one-man show.  He would build units on commission for family and friends, and eventually his reputation grew.  Now, Joe has a team of 50 people working for him.  MSB is known as a premiere boutique shop for high-end living room furniture in the metropolitan area where it is located.  While many other boutique shops are going out of business due to tough economic times, MSB has only seen a slight dip in revenues, and Joe, being a savvy businessman, sees the downturn as an opportunity.

Joe wants to expand MSB.  He has the high-end market segment locked down, so he has decided he wants to make a play for the mass market – the middle-class consumer.  He knows that to do this, he will have to compete with the big box stores, and he will have to make changes to his product line.  That’s why he hired, Bob.  Bob knows what it takes to sell to the middle-class.

Bob spends his first couple of months at MSB, crafting a product line that he believes will be a big hit with the demographic Joe wants to target.  It’s cheaper than MSB’s customized offerings, and as a result is far less customized.  It’s a basic product line, with only three options of colors, and a handful of configuration options.  Because the products are more standardized, MSB can churn them out at greater scale, for less cost, and can afford to sell them at prices that appeal to the middle-class consumer. It will stand apart from the products of the big box store because it has MSB’s reputation behind it, and because despite being cheaper, it will still be well-crafted.

Bob thinks they have a winner on their hands, so he presents the plans to Joe, and Joe is onboard.  Initial investment begins to create the infrastructure needed to add to MSB’s current custom business and bulid a standardized product line parallel to the custom line.

Two weeks before the launch of the new product line, Joe calls Bob into his office.

“Bob, I was talking to Sally from sales, and she’s really concerned that we’re not offering chestnut as a colour.  She thinks that if we don’t have chestnut, which has been one of our signature colours on our current products, we might lose our customer base.”

“Uhh…  Joe, we launch in two weeks.”

“I know, but I need you to find a way to add a chestnut colour option.”

Bob runs out of Joe’s office spends three sleepless nights at the office, but eventually figures out a way to add a chestnut colour option to the product line, and still launch on time.

A week before the product line launches, Joe again calls Bob into his office.  Joe looks anxious, which is unusual for Joe, normally a very calm and collected man.

“Bob, I was talking to Tim from sales, and he’s concerned that we don’t have a $50 piece in the new line.”

“Uhh…  Joe, we launch next week.”

“I know, but Tim thinks that without a piece at a bargain price-point, we’re not going to be able to get the bargain hunters.”

Bob has always prided himself on getting things done, and so he runs out of Joe’s office, grabs MSB’s chief designer, and they throw together a cheap, bargain-priced unit to add to the line, just two days before launch.

Launch time comes, Bob is exhausted, also he’s worried.  The last minute changes to the line make it a lot less tight than the line that he had initially planned out.  The production process is no longer as smooth and seamless as it was, as now there are manual workarounds that had to be worked out to accomodate the last minute changes.  There’s possibilities for human errors.

Sales start coming in, and Joe is ecstatic, they’re getting the sales from the mass-market segment they were looking for, but they’re also getting tons of orders for the low-end $50 bargain piece.  Also, Chestnut is the least popular colour in the line, but there are still a decent number of orders for it.

Volumes continue to grow, and Joe continues to get happier as he sees his revenues growing.  Bob, on the other hand is getting increasingly concerned. He hasn’t been sleeping of late.  He’s been talking to the people on the production room floor and they’re having trouble accommodating the volume of the bargain-priced piece, and the cost of keeping the chestnut coloured stain in stock is straining their budget.

Soon, a few glitches start happening in the production process, and the team falls behind its production schedule.  In order to make up for lost time, they start taking shortcuts, and some of the units going out are not the quality that MSB is used to producing.  Also, the shortcuts take less time, but cost more money.  Joe’s looking at his revenues, but Bob’s looking at the balance sheet, and while it’s still in the black, it’s not looking as great as he’d hoped.

Two months into the new product line, Furniture Weekly, after five years of writing nothing but glowing reviews of MSB, has slammed their new product line as “cheap, and of poor craftsmanship.” MSB’s reputation takes a hit, and the sales of their flagship custom line start to fall.

Joe calls Bob into his office one last time and tells him that he made a mistake. “I should have stuck to what we did best.  I’m sorry, Bob, but we’re going back to making high-end furniture only.  We’re not going to need your services anymore.”

The Moral of the Story

The above story is fictional, but I’m sure anyone who has worked in business for a little while has seen variations on it many times over.

Joe did make a mistake, but it wasn’t expanding his business.  There’s a large movement towards “small is the new big,” but I think what people forget is that this doesn’t mean that small can’t continue to grow.  Joe had successfully cornered his market, and he was in a good position to unlock a new revenue stream.  He wasn’t growing just for the sake of growing.  It was intelligent growth.

Joe’s mistake was that with his new product line, he tried to be everything to everyone.  By adding in the new colour option at the 11th hour, he was trying to appeal to the customers that he was already serving with his customized product.  By adding in the bargain-priced unit, he was trying to target the bargain shopper.  Bob’s product line was not meant to target either of those consumers.  It was meant to target the middle-class consumer who wants good quality at a reasonable price.  The consumer who wants a wider colour palette needs to spend more.  The consumer who wants bargain-priced goods is going to buy from Walmart, and isn’t as concerned about craftsmanship.

When you try to be all things to all people, you weaken your product offering, and you set yourself up for failure. Bob knew this, but he didn’t say anything because he was the new guy and he wanted to please his boss.  In the end, this cost Bob his job, so Bob failed in a big way, too.  It was his responsibility to make sure Joe understood what was happening.

What does this have to do with marketing?

If you don’t understand that this whole story is about marketing, I think you should head over and read Mitch Joel’s recent post on Six Pixels of Separation on the differences between marketing and advertising (even if you did understand it, Mitch Joel is still worth reading).

On a more precise note, however, the same lesson needs to be applied to all your marketing strategies.  Know your target market, and target them with a single-mindedness. Don’t get distracted by those that kind of look like your target market, but aren’t quite it.  The bigger your target market, the broader and more generic your messaging has to be.  The broader and more generic your message becomes, the less attractive it is to your target market.

Resolve to Treat Your Target Audience Well

A new year will be starting soon, and you’ll probably be making some resolutions.  Include in there a resolution to treat your target market with respect, and not get tempted to market to the world.

Happy Holidays, All. I hope you’ll all be taking this time to spend with your families, and enjoy some downtime, no matter your beliefs or religious denominations.

It’s the end of December, and the internet is flush with year-in-review blog posts. As much as I despise being a conformist, this blog WAS a one-year experiment that started a year ago. As such, a review of the past year, and an evaluation of how the experiment went is required.

Barefoot Running: After several years of trying to become a serious runner, but consistently being held up by minor injuries, I made a purchase this year that changed how I run, changed how much I run, and definitely changed the way people look at me. Vibram Five Fingers are quite possibly the ugliest shoes on the market, but they quickly became my favourite thing to wear on my feet (I am wearing my VFF Sprints as I write this). I highly recommend them if you don’t mind strangers whispering things about you as you go by.

Twitter: This year, I hopped on the bandwagon and started using Twitter. It took me a little while, but I eventually got the hang of it, and while I’m far from being an addict, I do enjoy logging in for a few minutes a day to see what’s happening. The great thing about Twitter is that its simplicity means the only limit to its usage is your imagination. It can be a tool for businesses, for writers, or just for having fun.

Personal Life/Social

There were no major events in my personal life this year, and I’m okay with that. My relationships, with family, friends and girlfriend remained the same, or got stronger. I realized that the most important people in my life have not changed for at least five years, and most of those, I’ve known far longer. Change is good, but sometimes, stability is better.

Overall

I may have come short of my goal to write 52 short stories, but in many other ways, in both writing, and outside of writing, 2009 was a good year for me, and I’m going to spend what’s left of it being grateful for that.

So, now that the year’s over, what happens to 52SS? Well, I think it’s going to stick around. I think I’ll extend the experiment, and I enjoy having a spot to share my thoughts. Expect the next post to come in the new year, and to talk about what’s in store for 52SS, and for me, in 2010.

How was your 2009? I’d love to hear what you’re proud of having accomplished in 2009, so please share in the comments.

In my last post, I told you all why I think more businesses need to focus on the local, and move into the global.  As a follow-up to that, I want to talk about one of the primary ways local businesses can use the web to promote themselves: search engine marketing (SEM).

SEM/PPC (pay-per-click) has become synonymous with Google’s PPC product, Google Adwords. Adwords accounts for over 90% of Google’s annual revenue.  The majority of that revenue, however, has been generated by larger, national or multinational advertisers.  Google has had a harder time penetrating the local market.  There are a number of reasons for this, but one of the bigger ones is that creating a SEM ad campaign for a local business requires different techniques and different strategies than creating a campaign for a national advertiser.

With this in mind, let’s take a look at 10strategies for improving the SEM campaign for your local business.

1. Don’t stop at Google

Google owns a little over 80% of the search market in the US, and 90% in Canada.  With such a vast majority of the market covered, there is a big desire to simply forget about the other search engines.

That’s silly, especially for local businesses.  Google’s primary advantage from a paid search perspective is its massive distribution network, and the huge amount of traffic available.  Local advertisers don’t benefit very much from the distribution network (see #6 below), and they typically have smaller budgets, as such, they can’t touch most of Google’s traffic anyway.

Most local businesses could easily spend their entire budget on Yahoo or Bing paid search. There have even been various studies that have been conducted that suggest that both of these engines convert better than Google. While I’m skeptical of that fact, one thing I do strongly believe is that, whether your potential customer is coming from Google, Yahoo, Bing or Dogpile.com, he is still arriving at your site through a relevant ad, based on a search he performed. Why should you care where he came from?  Would you turn away business from a newspaper ad because you really just wanted to focus on your television spot?

I also haven’t mentioned the primary reason to use search engines other than Google: the clicks are cheaper.  Because all paid search engines run on a bidding system, the more competition there is for keywords, the higher the cost of a click.  Yahoo, MSN, and even smaller, second-tier search engines, can provide you with traffic for a fraction of the cost of Google.

This being said, while most of the strategies that follow can be used on any platform, they will be written from the Google perspective for the sake of simplicity.

2. Target locally, target nationally

No matter how many times Google tells me they’re doing all kinds of cool things to determine the geographic location of a computer, I can’t quite bring myself to believe them, and here’s why: I live in Montreal, and I consistently see ads for Toronto, a city that’s 600 km (400 miles) away.  The reason for that is that the primary way that search engines determine a user’s geographic location remains through his IP address.  A user’s IP address is determined by where his internet service provider’s hub is located.

While this works well in most cases, there is still a large number of cases (such as mine), where geographic targeting of a campaign is inaccurate.  As such, the only way to ensure that your campaign remains truly local is to build two campaigns.

The two campaigns will essentially be identical, but the targeting on one campaign will be local, and the targeting on the other will be national.  Obviously, you don’t want traffic from all over the country, so in the national campaign, you will only use keywords that are modified with local modifiers.  So, while in your local campaign you might have the keyword “plumber,” your national campaign will include local variations of this word, such as “plumber nyc” or, “plumber manhattan.”

3. Include a local phone number in your ad texts

Users who search for local businesses are often bombarded by irrelevant, non-local results.  One of the easiest ways for you to make an impression on a user is by showing him a local phone number.  He knows his local area code, so he knows you’re a local business.  I’ve run a number of large scale tests on this, and it works almost without fail.  Don’t expect to save a ton because of people who will just call instead of clicking, though.  Remember that user behaviour on search engines is often driven by a click-happy, information-hungry, user-base that want more than 70 characters of description before they call you.

Also, be aware that toll free numbers don’t work as well for this kind of thing for the same reason that local numbers do: they don’t scream local.

4. Modify keywords with landmarks as well as cities

When modifying your keywords for geography, don’t stick to the city level.  While many users will search with a city name, others will search using the name of a region, a neighborhood or a landmark.  So, in addition to “plumber nyc,” try things such as, “plumber in soho,” or, “plumber near central park.”

5. Use Google Local extensions

Under the campaign settings tab in Adwords, Google allows you to add a local extension to your ads.  To use this feature, simply add your business’ address in the local extension form.  Your ad is now eligible to serve in Google Local results, as well as show the address in regular search results where it is relevant based on the user’s search query.

6. Avoid the content network

Google’s distribution network, known as its Content Network, works well for large national advertisers, because they don’t really care where their potential customers are, but for local customers, using the Content network efficiently is very difficult.  Unless you can choose individual placements on sites that you know are locally relevant, you’ll likely be wasting your time and money on the Content Network.

7. Target mobile

By default, Google allows you to serve ads for people on all platforms.  I used to recommend removing the option for “mobile” because the odds of getting a conversion from someone browsing on a regular mobile phone were slim to none.  Now that smart phones have become the norm, that logic has flipped on its head.  Phones have the most accurate geographic recognition from a search engine’s perspective, larger screens, and click-to-call power that make mobile phone users the ideal targets for a search marketing campaign.

8. Take advantage of negative keywords

Because local advertisers tend to have smaller budgets, it’s important to keep the focus of a SEM campaign tight.  Some of the ways this can be done is through the use of carefully selected keywords set to exact match.  The other way to do this is to liberally use negative keywords in both broad and exact match.  In order to determine good negative keywords, use Google’s keyword tool, and run regular search query reports withing the Adwords report section. Add nonsensical keywords as negatives.  Look for irrelevant queries in your reports, and add those as negative keywords.  Also, be sure to include nearby locations that you don’t do business in as negative keywords.  This will prevent someone close, but not close enough, from mistakenly clicking your ad and costing you money.

9. Use day-parting

Most local businesses have operating hours.  If your business has opening hours, and you can spend your SEM budget while serving ads only during those hours, do so.  While you can get good leads from customers who find your business after hours, and return to your site, or take your contact info down, visits that occur during business hours, are that much more immediate, and are that much more likely to lead to an immediate action by the user.  That added proximity and immediacy makes leads during business hours, more valuable than those after hours.

10. Optimize your landing page for local

You can have the greatest campaign in the world, but if your landing page is not optimized, it’s useless.  Be sure to optimize your landing pages specifically for local traffic.  This means including elements that speak to the location of the business, such as maps, driving directions, nearby points of interest, etc.  Users looking for local businesses, are likely looking for a more “traditional” experience (ie. talking to a person), so make sure your contact information is prominently displayed and easy to access.

Explore More

The above were just ten of my favourite SEM strategies that are particularly useful for local, but there are many more.

What are some of your favourite local web advertising strategies?  Have you tried SEM for a local business?  What were the results?  Let’s chat in the comments.

The other day, a colleague came up to me and said, “Can you take a look at this client’s search marketing campaign?  He wants to target all of North America.”

“What’s his budget?” I asked.

“Five hundred dollars per month.”

This got me thinking about how small businesses perceive the web and the opportunities that it presents to them.

Going Global

Not too long ago, a small business was, by definition, a local business.  Expanding beyond local was expensive.  It required infrastructure, logistics management, more inventory, and more resources.  Small businesses didn’t have any of these things.  Today, for the most part, small businesses still don’t have any of these things.  The difference is that now they don’t need most of them.

The first thing that allowed small businesses to expand beyond the local was the availability of cheap shipping.  This opened up the door to business models that included a centralized location, but that could service a wide area.  Amazon would not be the largest book seller in the world if it weren’t for carriers like UPS, FedEx, DHL and more, competing to bring down the price of bringing goods to the consumer’s front door.

With a distribution network already in place, the ubiquity of the internet made going beyond local a breeze.  With a home on the web, you could just as easily be found by your neighbour, one block over, or by a Texan rancher, or by a Tokyo yuppie.  The dream of going global was no longer reserved for the multinational.

Hugh MacLeod, the copywriter turned artist, turned small business author (affiliate link), often writes about the global microbrand.  The global microbrand is the manifestation of a single individual turning himself into a brand that he can market across the planet.  It appeals, particularly, to creative entrepreneurs like artists and writers, who often have a hard time finding a big enough market for their goods locally.

Hugh has built himself a global microbrand, with little financial investment, and a whole lot of hard work and perseverance.  Still, Hugh has always been quick to point out that while he has become “internet famous,” he has yet to strike it rich.  As sales of his books and his art increase with the size of his audience, it may only be a matter of time, but it hasn’t been easy for him to get there.

Hugh’s story, and stories of those like him, have showcased that it is possible to go global with a small business and be successful. But, I can’t help but feel that going beyond local too quickly makes this process harder than it needs to be.

The Advantages of Local

Before the internet and cheap shipping made it so easy to start a global business, the ordinary route for expanding beyond local went something like this: Start a local business.  Develop a reputation as a trusted member of the local business community.  Grow revenues.  Use revenues from your first location to open a second location.  Wash.  Rinse.  Repeat.

Going global, was a slow and tedious task, especially if every location you opened took as long to grow as your first location.  No wonder people wanted to skip all that and turn to the web.

The thing that we forget is that growing beyond that first location isn’t a direct line of growth, it’s an exponential growth curve.  Sam Walton started off owning a single general store in Arkansas.  Today, Wal-Mart is the biggest retailer in the world, and the Waltons are one of the wealthiest families in the world.  Every single store they opened after the first store got progressively easier to open.  the simple reason for that is that the reptuation from all of the previous stores, made expansion easier.  Today, if you find out a Wal-Mart is opening near you, regardless of your feelings towards the chain, you know exactly what the expect.  Decent, but not excellent, quality goods at everyday low prices.  You just know that.

There are certain advantages to starting locally, and the biggest all have to do with reputation.  When you start your business locally, you know the people around you.  You know your market.  You know your customers.  In fact, when you start locally, you probably knew your customers long before they were your customers.  In many instances, you start off with a built-in group of customers.

Those customers learn your reputation, and they spread it to those closest to them.  They talk about it at the office, at the bar, at Sunday barbecues.  Word of mouth is really easy to achieve locally.  Getting brand awareness locally is also really easy.  How easy?  Start wearing a T-shirt with your business’ name on it, and walk around your city.  If you don’t think that’ll generate leads, then there’s an issue with your business, not with your city.

Aside from that, in the local space, we all already have pre-established networks that we can use to spread the word of our business, all of which contributes to its success.

So, that’s great for getting that first location up and running, but how does that help in going beyond local?  Quite simply because now you have a history when you open your second location.  You have experience, you have testimonials, and you can point to all of these as social proof that what you do works.  This makes the second location that much more likely to succeed.

The Problem with Skipping the Local Step

The big problem with skipping the initial local step, and going global first, is that you’re removing all of your pre-existing advantages.  The web, and the world are huge, scary places, and most of us don’t have many connections “out there.”  If you’re concentrating on making worldwide sales, your backyard barbecue probably isn’t going to do you a whole world of good as a networking event.

I concede that there’s no reason why the people who would have bought from you if you were local won’t buy from you if you’re trying to go global, but the fact of the matter is, companies trying to go global have a different mindset.  They start thinking of their market in terms of generalities, and oftentimes, this isn’t the best way to attract local buyers.

The other big issue with skippling the local step is that while many of the problems of going global have been resolved by modern conveniences, some still remain.  True, you only need a single warehouse, and can ship around the world relatively cheaply.  Alternatively, you can use drop shipping services.  You don’t need physical locations all around the world, you can take orders from a single website.

But what about our client from the beginning of this article?  Is he ready to go global?

You’ll notice that the first question I asked my colleague wasn’t, “What does the client do?” or “Where is he located?”  Instead, I asked, “What’s his budget?”

The internet has done some incredible things for marketing.  It has lowered the cost of marketing to the point where a small business can realistically compete with a multinational.  However, it has not caused miracles to happen.  A $500 budget for search engine marketing campaign is still a small budget, and while you can and should see good results for that budget on a local scale, it simply doesn’t make sense on a continental scale.  It’s the classic definition of spreading yourself too thin.  Yes, search engine marketing is a pay for performance medium.  Yes, you only pay when your ads are clicked.  Yes, mathematically speaking if you convert 10% of all visits on your site, it shouldn’t matter where those visits are coming from.

But it does matter.

Your clicks will be spread across an entire continent.  You’ll get single visits from various places. And, while mathematically, a 10% conversation rate, should mean that 10 out of every 100 visitors will convert, in practice, when all 100 of your customers are sitting in different locations, it rarely ever works that way.

Furthermore, none of what you learn from your campaign has any meaning because your data isn’t significant.  In order for data to be significant, you need to have a certain quantity of data.  Not only that, but all of the data points in that data set need to be similar.  When you’re targeting a wide area with a small budget, all of your data points are different.  You never get significant data, so it’s impossible to optimize your marketing.

The bottom line is that in many media, it still takes bigger budgets to broadcast on a wider scale.

Start local, hit your stride, then bust out of your local market.  Not only will it be easier to do, but you’ll be better prepared to take on the hyper-competitive global market.

What’s been your experience in the local vs. global game?  Have you gone beyond local?  Have you purposely chosen to stay local.  Share your story in the comments.

Ten years ago, the question was does a small business need a website?  Not everyone agreed on the answer to that question, but as the internet grew and took on more importance, the “yes” crowd steadily got bigger.  Recently, though, that crowd is starting to shrink.  If you reframe the question to, “Does a small business need a web presence?” you’ll rediscover the big “yes” crowd.  However, no longer does it seem that that web presence needs to be a website, in the traditional sense of the word.  One alternative to a small business website is a blog.  Nowadays, many small business have a website and a blog. Are blogs the new websites? Does a small business need a blog?

While I firmly believe that every small business can benefit from a web presence, the question of the blog isn’t so clear to me.  Let’s look at some of the advantages and disadvantages of blogging for small businesses.

The Advantages

1. It’s cheap

Small businesses don’t have huge marketing budgets, and so anything inexpensive is worth looking closely at.  Whether you have a website already or not, creating a blog is quick and can be free.  If you want to host your blog on your own domain, then you’ll need to purchase the domain from any number of places.  Then, you have to decide which blogging platform to use.  All of the major blogging platforms are free: WordPress, Blogger, TypePad (micro), Tumblr.  I have played around with each of these, and I think that WordPress is the way to go for the small business.  The interface is powerful, and the ability to add plug-ins makes it infinitely extensible.  Even if you just want to set up a simple blog, it is painless to do in WordPress, and you have room to grow.

If you want something more customized than the basic themes offered by WordPress, there are tons of free WordPress themes out in the wild, and there are developers who specialize in creating WordPress themes if you want to go the route of spending a little money on your blog.  The other option is to tweak an existing theme.  AdamDiStefano.com is built on WordPress and runs a modified version of Chris Pearson‘s free Copyblogger theme.

Even if you do decide to hire someone to create a theme and setup your WordPress for you, these kinds of jobs are considerably less expensive than building a website, because the framework already exists.

2. Creates a rapport with a customer

I keep hearing that customers want to buy from a business that they can connect with.  While, I’m still not convinced that this is the primary thing that customers are looking for in a company, providing a little transparency to customers can’t hurt.  While I may not care if the person I’m purchasing my new rocking chair from is my friend, some insight into that person’s craft can go a long way towards convincing me to purchase from him.

Aside from that, one of the biggest advantages that small businesses have over big business is that they have a human face.  Big business is catching on to this and many big companies now have brand advocates whose entire job is to make the business look human through the use of social media, blogs and other humanizing devices (there is still something strangely creepy about this process).  Oftentimes, these efforts can come off as forced, and rigid, with a corporate blog reading like something between a press release and an annual report.  Small businesses have the advantage of already having that human aspect, and so blogging will serve only to cement that.

3. Establishes you as an expert

Returning to the example of my rocking chair-making friend, by blogging about his craft, he is building authority.  If he produces quality content that educates and informs, this will be recognized and add credibility to sales pitch.  I imagine that there is considerable skill involved in making a well-crafted rocking chair.

Because small businesses often have to deal with the customer’s fear that they are not as professional or reliable as corporations, building this authority and credibility is essential for reassuring customers and attracting them.

4. Creates a way to be found (SEO)

In a previous post, I explained how search engine optimization works on a basic level.  Blogging helps with three major factors that determine a site’s ranking on Google: content, regular updates, and popularity.

Content speaks for itself.  By blogging, you create content.  Content is what search engines index.  Likewise, by its very nature, blogging provides the regular updates of relevant new content, that search engines like to see in sites.

Blogging helps the site’s popularity because if you’re doing it right, you’re creating content that people will want to link back to.  These back links are the currency that search engine algorithms are built on.

All this boils down to ways people can find you.  Whether it be through search engines, or through those back links (which people sometimes forget are more valuable in and of themselves than as search rank juice).  More visitors to your site means more potential customers.

The Disadvantages

1. It’s time consuming

Writing a blog takes time.  Contrary to what I’ve heard some claim, it takes lots of time, especially if you want to do it right.  You need to brainstorm topics.  Outline posts.  Research information that goes into those posts.  Write a draft.  Proof and edit that draft.  Post the final version and do any necessary formatting.  Then there’s the process of promoting the blog.  All of this adds up to a sizeable chunk of time.

Unfortunately, time is probably the one thing small business owners have the least of, right next to money.  And as we’ve already seen, time is money.

2. It doesn’t make sense for every business

I’ve heard proponents of blogging claim that everyone should be blogging.  I don’t agree.  First of all, if you’re not comfortable communicating with your customers, you shouldn’t blog.  Some will tell you that you can learn the skills necessary to blog, and yes, you probably could, but the idea behind blogging is to be authentic.  If you’re not being authentic, don’t bother.  Or if the authentic you is not someone that you think will draw customers in, don’t do it.

There are also certain industries where I just can’t see much sense in blogging.  The way I see it, the ideal is to be sharing expertise with potential customers or with people who will refer potential customers.  The problem isn’t so much that the service or product you provide doesn’t require much expertise, because if you’re in business, you’re adding some kind of value.  Instead, the issues arises more when the area of expertise is related to something that people don’t particularly want to learn about.  For example, I use dry cleaning services, and I’m sure there’s a whole science behind the process, but I really can’t see myself or (anyone else for that matter) reading a dry cleaner’s blog.  And the people who will read the blog are unlikely to be customers.  There’s a better chance they’ll be people looking to start their own dry cleaning business, or looking for DIY home solutions.

For some businesses, running a blog just doesn’t convert.  A blog just like any marketing tool, should have a measurable return on investment (ROI).  If there’s no ROI, there’s no reason to do it.

3. Risk of abandoning it

Worse than not having a blog is having an abandoned blog.  You see them all the time because they are littering the internet.  A blog that’s online is there for all to see.  If a user finds your blog and sees that it hasn’t been updated for six months, this immediately raises alarm bells in that user’s mind.  The same user finding a static web page that hasn’t been updated in six months doesn’t have those same concerns as long as the info on it is current.

Whether, justified or not, an abandoned blog conveys lack of professionalism, poor management or fear that the business no longer exists.  if you start writing a blog, you need to be certain you can keep up with the commitment, otherwise, it will do more harm than good.

Conclusion

Blogging is not for every business.  To decide whether it’s right for you, you need to evaluate the above points and do the math.  However, even if you decide not to blog, you should still have some kind of online presence.  This can be a static website, an active presence on Twitter (warning: also time consuming if done correctly), a Facebook fan page, a Google place page, landing pages as provided by online directories, etc.

Blogging can be a powerful marketing tool, but it’s not for everyone.  Find what works for you, and use it.  And beware those who promise one size fits all solutions.