Entries Tagged 'Marketing Strategy' ↓

I read a lot of blogs.  Too many blogs.  I read so many blogs that I’ve cut out most mainstream media in favour of blogs.  Because I read so many blogs, I am very ruthless about what other information sources I consume.  As a result, until recently, I had a strict “no newsletter” policy.  I tried to keep my inbox pristine.

I’m not alone in this kind of thinking.  Many people have a hard time digesting e-mail newsletters.  it’s one thing to visit someone’s blog daily, it’s another to give them permission to deliver something into your personal inbox.  Besides, what’s the point?  If you have a blog, why would you need a newsletter?  Why can’t you just say everything on your blog?

Before blogs, there were…

Before blogs became one of the biggest forms of publishing on the web, the web was rampant with ezines.  Ezines served a similar purpose to blogs in that they were a medium to convey content, but they had more in common with their offline counterparts. They were more editorialized, often organized around set publishing schedules, and were generally collaborative, as opposed to individual, endeavours.

One of the earliest books I read on freelance copywriting as a business advised leveraging the internet to find clients.  A website was the main focus of the internet marketing campaign, but more important was the newsletter.  The newsletter was a regularly scheduled release of information that would be given away for free to anyone who wanted to sign up for it.

When blogging became all the rage, I decided that blogging combined the best of ezines and newsletters, and could probably replace both media.

I was wrong.

The purpose of a blog

There are any number of reasons to start a blog, but for a small business owner, the primary reasons to start a blog are to create content that will attract visitors to your site, whether through search rankings, or through social channels.  Blogs also help to build trust, and they demonstrate a level of expertise.

The purpose of a newsletter

At first, I thought the purpose of a newsletter was identical to that of a blog.  That’s where I was wrong.

If you create a newsletter with the same goals as a blog, you can probably have a relatively successful newsletter, based on readership and subscriber base.  However, that’s a waste of a newsletter, because a newsletter is first and foremost a prospecting and lead generation tool.

Because of the more personal nature of a newsletter, the reader invites you into his inbox, the relationship between the creator of a newsletter and the creator of a blog is generally much closer.  These are the publisher’s biggest fans, his tribe.

Running a blog and a newsletter

The fine line that needs to be walked of course, is for those who have both blogs and newsletters.  It is easy for the two to become redundant.  After all, to the reader, in the end, what you’re doing is creating free content.

The best way to avoid this is to create each with the knowledge in mind of who the audience is.  A blog’s audience is large and wide. Anyone should be able to stop by your blog, read and browse. The content should appeal to all, and should be written for all.  Meanwhile, subscribers to your newsletter already know who you are, and they like you enough that they’ve decided to let you into their inboxes.  As such, this is a place where you should be writing to a smaller, closer audience, an audience that you should be engaging in a dialogue with.  This is your inner circle, and they should be treated with the respected that that commands.

Oftentimes, I point to Chris Brogan as an example of a guy who does a lot well on the web, and I learned about Chris through his blog.  I became an avid reader, and devoured everything he wrote.  One day, he came straight out on his blog and asked me (okay, everyone) to subscribe to his newsletter if they felt so inclined.  He promised different content, and a different feel.  And y’know what?  Chris delivers in his newsletter.  He gives subscribers to his newsletters unique content, addresses them colloquially and even gives them early heads up on his upcoming projects.  Sometimes he encourages them to share the word, other times he asks that they keep the news their little secret.

If you want an example of how to run a blog and a newsletter properly, visit Chris’ blog, and then subscribe to his newsletter.

Getting the most out of your newsletter

Now that you’ve decided to create a newsletter, and have an idea of how to differentiate it from your blog, how do you actually pull a benefit from it?

First, and foremost, never forget that your number one goal is to provide valuable content.  If your newsletter degenerates into pointless rants, or constant sales pitches, you’ll lose subscribers faster than you sucker in new ones (and yes, if that’s all the content you offer, you are suckering them in).

The next thing to remember about a newsletter is that it is a leads generation tool, as such, there is a certain amount of selling that you should be doing, and that’s okay, because newsletter subscribers, when they subscribe are expecting a certain amount of sales pitch.  People don’t necessarily mind being sold to, as long as they know it’s coming, and it’s something they’re interested in.  So, in addition to your content, sprinkle in some offers, or news about upcoming projects, or products.

Use your newsletter as a prospecting tool.  These are the people most likely to purchase from you, but at the same time, be careful how you position this.  Remember, these people have trusted you with their contact information, and trust is easily lost when you oversell.

The true secret to a great newsletter is managing the balance between offering great value, and earning trust, and also prospecting for leads in a way that’s acceptable and unobtrusive.

Do you have a newsletter?  Do you have a blog?  How do you balance the two?

“Traditional advertising is dying.”

In my line of work, I hear that line a lot.

I work for the Yellow Pages Group of Canada, a company that is associated with one of the most traditional forms of advertising you can think of. I also happen to work on the online side of the business, specifically in relation to online performance marketing products, such as search engine marketing. In other words, the industry that’s killing traditional advertising.

Traditional advertising refers not only to yellow pages directories, but print newspaper advertising, radio broadcast advertising, and some push it as far as broadcast television advertising.

I have seen all the numbers.  I have read all of the reports.  Internet advertising is still a growing business.  In fact the amount of time consumers spend on the internet is still vastly disproportionate to the amount of money businesses are spending online.

That tells me two things:

• First, that if internet advertising is a growing business, and there is a finite amount of marketing dollars in the market, by definition, other forms of advertising will take a hit.
• Second, there’s still a lot of types of advertising out there that businesses are spending money on. And if they’re spending money on it, it means it’s working to some degree.

One of the things I’ve noticed in the past couple of years of working in the industry is that internet marketers seem to have an endless bag of reports and numbers that they can pull from to justify just about every single argument they can make.  The scariest part about these numbers and reports are that most of them are created by groups that have a vested interest in making money online.  What else would we expect them to say?

In defense of the fact that traditional advertising is dying, and that web advertising is gaining ground, someone pointed out to me the other day that after decades of advertising during the Super Bowl, Pepsi decided to instead do a Facebook marketing campaign.

Fair. Pepsi was absent from the Super Bowl. But do you know who did advertise during the Super Bowl for the first time ever? Google.  Google has also been using print and billboard advertising to market its various apps and its Nexus One phone.  They’ve also used billboard advertising to advertise their search engine outside of North America, where they generally tend to have a lower share of the search market.

So, Google, the ultimate symbol of internet advertising does traditional advertising. They must know something, that the other internet marketers don’t…

Yes, traditional advertising will decline, simply because online advertising will continue to grow. However, it will not disappear, and the simple reason is that it’s still effective.  Yes, we spend a lot of our time in front of glowing screens, but we also do a lot of other things during our day that aren’t connected to the internet, and until we abandon them to live our lives entirely virtually, there will be a use for traditional advertising.

Let me put this another way. Internet marketers spend their lives on the internet, so they sometimes forget that other people – normal people – have slightly healthier, more balanced lives.  People read.  People listen to the radio.  People watch TV.  Believe it or not, people flip through phone books.  People drive by billboards on their way to work.  People go to sporting events.  People live outside of the web.

Traditional advertising is still alive because it’s still effective.

Whether we’re talking about actual ad blocking software (Full disclosure, I myself use the Firefox extension AdBlock Plus on my home computer), or we’re talking about a general blindness to display advertising, one thing seems certain, display advertising is not as effective as it once was.  As the general population becomes more web savvy, fewer people are clicking on those whack-a-mole-style banners.

Furthermore, users have gotten used to the constant bombardment of ads, and in order to cope they have developed an immunity.  When you walk by a section of town where every inch of wall space is covered in promotional posters, those posters become a part of the scenery and lose their effectiveness as advertisements.

Bouncing Back

The case against display advertising seemed pretty damning a year ago, but it would appear that things are turning around.  Display advertising appears to be bouncing back, and continuing to grow.  With growth particularly in industries like the automotive industry, display seems poised to re-establish itself as a mainstay in any marketing mix.

There’s no doubt that the economic conditions of the past two years have hurt display advertising, as advertisers seek only the highest ROI marketing. But with a recovering economy, display is once again becoming an option, and with good reason.

Display Advertising Works Differently than Search

Before the rise of search marketing, display advertising was the only way to drive traffic that would convert to a website.  Search, and in particular the more recent advancements led by Google to improve the relevance of search, made conversion to sales the biggest strength of search marketing, and made display look lame in comparison.

However, the strength of display is not in clicks to conversions, but rather in branding and reach.  A comScore report from not too long ago demonstrated that despite a lack of clicks, display advertising can have a significant positive impact on:

• visits to the advertiser’s website
• likelihood of conducting a search for the brand or product
• likelihood of purchasing the brand or product online
• likelihood of purchasing the brand or product in physical retail locations

The reason for this is quite simply that the reach of display ads is typically greater than that of search.  This means that display advertising is best used to create awareness of the brand or product, and to prompt a user to conduct a search query, or otherwise seek more information. Meanwhile, search is best used when that user is closer to the point of purchase.

In other words, the best results are obtained when display is used in conjunction with search.  In marketing circles this is conventional wisdom, but the love affair with search has caused some to lose sight of this.  However, both logic and empirical evidence suggest that a multi-pronged marketing approach is the best way to go.

The evolution of marketing is not about forgoing one form of advertising for another.  The evolution of marketing is about serving the right advertising to the right audience.  Whether it be search, display, banner, or other, it doesn’t matter, as long as it’s relevant to the user.  If advertising is relevant, it will be effective.

Oftentimes, when I talk to people about internet marketing, if they’re listening, they quickly come to a sudden realization.  “It seems like you’re giving away a lot of stuff for free.”

It’s true.  The internet has created a culture of free.  On the web, craftsmen demonstrate how to perform tasks that they would normally charge for.  Accountants and lawyers dole out advice that once upon a time they billed for.  Software makers give away their products.  Writers publish their writing publicly, without even the modest advances that they would get in print.  Artists post their work for all to see, free of charge.

“If you’re giving everything away for free, how do you make any money?”  That’s a question that a lot of people have struggled with on the web.

There seems to be two main approaches to dealing with “free.”  The first is to reject the notion of free altogether.  If you create something of value, you should be compensated for it.  While I agree with that argument, notionally, in the long run, it’s doomed to failure.  The internet has created this culture of free, and like it or not, it’s going to continue.  There will always be a group that’s doing exactly what you’re doing, but for free. That group will get bigger, and if you’re the only guy in the field who’s charging, how good do you think your chances of surviving in the long run are?

The alternative is to embrace “free” and find ways to still make money while doing so.

The Freemium Model

The Freemium model – popularized by Chris Anderson, the founder and editor of Wired magazine – is possibly the most popular business model among web start-ups.  The idea is simple.  You offer a product or service for free, but you also offer a premium version of that same product or service for a fee. On the web, you find feature charts on any website where you can download an application.  The feature chart outlines what features come with the free package, and then shows you the additional features you get when you purchase the basic package.  Then more features you get by buying the Plus package.  Finally, even more features you get purchasing Gold package.

The freenium model has been shown to work when the right balance is struck between what to offer for free, and what to charge for.  If you lock too much up behind a pay wall, then you’ll never get the traffic necessary to start rolling.  If you give too much away, all your resources will be devoted to creating free products, and you’ll be bleeding money.

The Other Kind of Free

The alternative is to offer a substantial amount of content for free, but then to offer a different, but related product for sale.  Content sites will often do this by selling merchandise.  This can also be viewed as the “expert” model, because it often involves creating a reputation for yourself as an expert by giving away advice, and then creating products that you can sell based on the strength of your reputation as an expert.

In order for this free model to work, there are a few key points to recall.

First, recall that “free” is a numbers game.  Never will 100% of your website’s visitors (who mainly come for the free stuff) buy your products.  Instead, the idea is you reach a wide audience with your free content, and a certain percentage of those will be interned in purchasing from you. The goal is to convert as many visitors into paying customers as possible.

Second, remember that even those that aren’t buying from you, are still valuable.  The people who don’t buy, may still lead others to your enterprise. These secondary connections can be more valuable than if the visitor had just purchased from you and gone on his merry way.

Third, despite talking about doing stuff for “free,” recall that what you’re doing is still marketing. You’ll need tight copy that reminds your readers/fans/followers/tribespeople what the benefit is to them of purchasing your product.

Finally, if you’re going to follow this tactic, be sure to make it clear from the outset that you’re going to be selling something.  The most important thing you have is the trust relationship between you and your visitors. Part of trust is transparency and honesty. If you have visitors that are used to getting free stuff and you suddenly hit them with heavy-handed sales pitches out of left field, they’ll annoyed, frustrated, and abandon you.

The “Thank You” economy

As far as I know, Gary Vee is the one who coined the term the “Thank You” economy.  Gary for years has created and hosted a web TV show, 5 days a week, reviewing wines.  He also answers every e-mail he receives, and spends hours every day actively interacting with his hundreds of thousands of twitter followers.  He does all this for no charge.

Gary coined the “Thank You Economy” to explain what he gets out of it.  Gary accepts that what he’s doing is free, and that the vast majority of the people who watch his show, or read his blog, or take advantage of his wine recommendations will never give him any money.  However, there is that portion of his followers, his fans, his tribe, that will thank him for all he’s done, and when he does a paid product, they will thank him by purchasing it.

Gary proved the effectiveness of this method when his first book came out late last year and became a best-seller (Amazon affiliate link) as soon as it went on the market.

Thank you.

YouTube’s been around for years, and it’s one of the most popular sites on the internet.  Sites like Hulu and Boxee are making American cable companies nervous (in Canada, Hulu’s blocked).  Certainly, the move from broadcasting on the tube, to broadcasting over the web is coming, but we have yet to see any groundbreaking made-for-web content. Last week, Rev3 put out a tongue-in-cheek open letter to Conan O’Brien, encouraging him to move his show to the web.  While the letter was a joke, is that so far off?]

The big question around broadcasting content on the web, however, is what’s the revenue model?  Network television makes its money through advertising – raising the same kind of advertising revenue on the web could prove to be problematic.  Cable networks make money through subscription.  This could be a possibility, but I think we’ll truly see if this is feasible this year if Hulu begins charging for content.

Where does this leave the advertisers?  Advertisers have used 30-second television spots with great success for half a century, but what happens when (not if, when) network television dies?  The logical answer is that advertisers will move these dollars to the web.  Some marketers are touting video as the next generation of advertising on the web.  Some marketers go so far as to imply that video will become the dominant content on the web, replacing text and static images.

This is where I get skeptical.

We have seen a number of success stories of people who have used video for business purposes to great success (the name Gary Vaynerchuk comes to mind, for one).  However, a few examples of success doesn’t mean that video is going to replace all content.

4 Reasons Why Video Won’t Replace Text

1. History Tells Us Otherwise

The web’s great value is that it’s a resource in addition to an entertainment source.  People go to the web to find information. That’s where there’s value for advertisers, because they can find consumers who are looking for answers.  Just as documentaries did not replace books as the way we do research, so too, will videos not become the definitive resource for a person searching for information.

2. People’s attention spans are too short

The web has nurtured an environment of people who have an 8-second attention span.  You might think this is an argument in favour of video, but it’s not.  How often can a person be hooked by the first 8 seconds of a video?  Not often.  Video as a medium needs time to develop, and it can’t easily be scanned.  Text on the other hand is inherently scannable.  I scan tens of thousands of words of text on the internet every day.  I do it because scanning text is easy.  I can’t scan hundreds of hours of video every day.

3. Look at usage patterns

When does a huge portion of web traffic occur?  While people are at work.  People will happily read/scan through multiple articles during spare moments at work, but very few people have the kind of job where stopping and watching a full video is acceptable or feasible.

4. The right way to use video hasn’t been discovered yet

The 30-second commercial spot on television worked because of the nature of the medium.  People had to watch it while they waited for their regular programming to come back.  There is a small trend of companies trying to reproduce this same format on the web.  That simply won’t work work on the web, because no one will actively seek out a commercial.  In fact, people watching television are actively looking for ways to avoid commercials.  What makes these companies think that just because you put them on the web now, people will want to watch them?

A Few of the Right Ways to Use Video

As mentioned earlier, there have been some success stories for using video, and as such, there are some lessons we’ve been able to glean from these about how to use video.

1. Promotional tool. Use video content as yet another avenue to guide people back to your web HQ.  This can be accomplished by posting something of interest on YouTube, and pointing people back to the HQ for more info.  This is about creating valuable content, not selling.

2. Do something different. A lot of people, especially in the world of blogging, are experimenting with video.  Unfortunately, most of them are simply taking the blogposts they would have normally written and reciting them into a webcam.  If your video doesn’t add anything, just write it.  Video allows you to demonstrate and visualize things in a way text doesn’t.  Take advantage of that, or risk creating some of the dullest videos on the web.

3. Add personality. The social web has demonstrated to us all that consumers like it when the brands they buy from have personality.  Video allows consumers to see who they’re buying from.  If you can create video that allows your customers to feel like they know you better, you’ve succeeded.

4. Create a viral hit. The holy grail of internet marketing is going viral.  It costs next to nothing, and all of a sudden everyone and their cat has seen your video and passed it along.  The problem with creating a viral hit is that there’s really no way to predict what will go viral.  The first viral hit of 2010 has been the American Idol rendition of “Pants on the Ground.”  Not sure that was intentional…

Experiment with video and add it to your marketing mix, but make no mistake, it is not a replacement, it is a supplement.

While you’re playing with video, you might also want to check out Get Seen, as recommended by Chris Brogan.  I haven’t looked at this yet, but Chris usually gives good recommendations.

Oh, and don’t expect many videos from me in the near future.  I know my strengths and my weaknesses, and I know that for the sake of anyone reading this, I should stick to writing.

In my previous post, I talked about the importance of having an internet presence, but went on to claim that that presence didn’t need to be a website. Now, I want to explore what some of the options for building that presence are, and discuss them a little more deeply.

To be clear, what I’m talking about here is not just a place where you appear on the web. It’s the hub of your internet presence. You may show up in a number of different places on the web, but what I’m going to be talking is the main place where you want all your traffic to be feeding back towards. It’s what Chris Brogan calls a home base.  I call it a HQ (headquarters).  I’ve also heard it called a hub.  Whatever you call it, it’s the place that all your other online presences should be pointing towards.

If you have multiple presences on the web, I highly recommend picking one of them to be your HQ, and putting your best content there, while the purpose of everything else you do should be to drive traffic to the HQ.  That being said, let’s look at a few different ways to build your HQ.

1. Build a website

Yes, I did predict that websites are going to begin to fall out of favour among SMBs, but for the moment, they’re probably still the most popular choice for SMBs looking to get online.  A good business website is not about having the coolest design on the planet, or having the best flash intro.  It’s about being accessible, clear and leading to conversion.  You can easily spend twenty thousand dollars on a site that will never make a single sale.  That’s why I think that the most important thing about a web design team is not how skilled the graphic designer, but how smart the person who optimizes for conversion is (and if no one’s doing that, then you might as well be throwing away your money).

Design and flash are cool, and can help make a good impression on a new visitor, but unless your site is optimized for conversion, don’t bother.

It’s also worth noting that while the skills necessary to build a mainstream website from scratch are slightly more intricate than when I learned HTML ten years ago, building a professional looking site has never been easier thanks to a variety of do-it-yourself platform based tools.  These are often good cost-effective solutions for an early site, and you can always upgrade later. One example, I’ve heard good things about is Squarespace.  There are many others.

2. Take advantage of a social media presence

3. Use directory profile pages

4. Use Google Local Business Centre

Google Local Business Centre is Google’s big push to get into the local business market.  Traditionally, Google’s been great for national advertisers, but has had a hard time attracting smaller, local advertisers into its fold.  The Local Business Centre might be the answer that Google’s looking for.  Essentially, Google aggregates information from a bunch of different sources and creates listings and pages for every Local Business.  If you never do anything about this, Google will still create this page for you, and will populate it with whatever content its search robots find on the the internet that’s related to you.

Admittedly, that’s slightly alarming in some respects, because you don’t have complete control over your internet presence, and for that reason alone, I don’t think I would rely on Google Local as my business HQ.  However, being aware of it is a good idea, because it can be a powerful tool, and could potentially deliver a lot of traffic.  John Jantsch at Duct Tape Marketing recently posted this article about Google Local, that’s worth a look if you want to know how to get more out of it.

5. Build a Squidoo Lens

Squidoo is a site started by Seth Godin, one of the leading thinkers on internet marketing.  That fact alone should make you want to consider it.  If, however, you’re not convinced by my endorsement alone, I’ll do my best to describe Squidoo.  On Squidoo, you create a “lens.”  A lens is a kind of page that captures all sorts of different pieces of content and presents it in a chronological, but otherwise, unorganized fashion.  I played around with a Squidoo lens for a little bit, but ended up getting distracted by something shiny.  My aborted attempt, however, shouldn’t discourage you from seeing what the site has to offer.

6. Be a Virtual Shopkeep with an Ebay Store

If you sell goods over the internet, setting up an Ebay storefront might be the only HQ that you need.  The auction super site provides a trusted mechanism by which you can sell your products without going through the trouble of building your own e-commerce site.  It also has built-in traffic generation since people searching for products on Ebay are likely to come across your storefront, or if not, at the very least your products.  If your sole purpose in being online is to sell directly to people through the internet, and not have them ever come into your brick & mortar store, there are worse options.

7. Join the Blogosphere

I was talking to a prominent blogger and marketing consultant a couple of weeks ago, and I asked him about his blog.  It is a bare bones, standard templated blog, and it’s not attached to any “real” website.  As it turns out, this person had had a website built for him, had invested the money in it, but once it was ready, he found that he didn’t like the outcome. It was not adding any value, and it was just burying the one thing people came to him for in the first place: information. So, he scrapped the website, and continued using his blog as his sole internet presence. This tactic seems to work well for professionals in an information industry.  it’s easy to communicate the information through a blog, and you don’t need to worry about listing inventory or hosting galleries of your stock.  A simple blog with an “About” page and a “Contact” page has worked well for many consultants, designers, writers, artists, and could also work well for lawyers, accountants, and other knowledge workers.

Those are just a few of the various possibilities for buildling your internet HQ.  Do you have any to add to the list?  Add to the conversation in the comments.

A few weeks ago, I wrote a post asking whether a small business needs a blog, but I realized while writing it that I had jumped ahead of myself. The question I should have first posed was whether a small business needs a website. The answer to that question is no.

Small businesses don’t necessarily need a website, but they do need a web presence. A web presence is simply a foothold on the web that a business can direct its customers to. It serves the function of providing basic information, whether that be about products and services, hours of operation, or even simply contact information.

Ten years ago, the only way to have this kind of presence on the web was to have a website, and that probably meant learning a bit of HTML and getting yourself a Geocities account. A website was a collection of linked together static web pages. When was the last time you heard someone use the term web page? The term has fallen out of use because a page is only a useful term when it is static. Today’s websites have evolved where they’re no longer a collection of individual pages, but a single interactive platform.

Web site design has come a long way since the days of basic HTML and Geocities. You could still create a site using basic HTML and a free web host, but if you expect that to stand side by side with a professionally designed site, you may be kidding yourself. It’s the equivalent of erecting a lemonade stand next to a Starbucks.

As website design capabilities have evolved, though, a curious thing has happened. Websites have become more than what most small businesses need. Most small business don’t need fully interactive sites with integrated CMS, AJAX capabilities, check-out carts, and user review functionality. More importantly, most small businesses can’t afford all those bells and whistles.

That’s why I predict that after several years of consecutive growth, the percentage of SMBs that have a website will now begin to fall. The reason for this is not that SMBs are going to turn away from the web – that would be a huge mistake – but rather because they now have other options for crafting their web presence without investing in a whole website. So, you’ll actually see the percentage of SMBs with a presence on the web continue to rise, all while you see the percentage with websites falling.

There are three reasons why we will soon start to see this trend towards a web presence that is not a website. The first is because SMBs now have alternatives to websites for creating their web presences. Things such as internet directory profile pages (internet yellow pages, yelp, etc.), Google local business center, Facebook fan pages, other social media profiles, blogging platforms, and many other standardized options offer the ability to present the necessary information without all the bells and whistles that SMBs don’t need for the right price: free or just about. The standardized pages look very similar, and offer similar content, to the websites of a few years ago. The difference is they’ve now been commoditized.

The second reason we’ll see a move away from websites is that the web design industry will actually push SMBs away from websites. Web design for SMBs is a high-touch, low-margin business. Because of the availability of cheaper alternatives, the only way for web design firms to justify charging enough to be profitable is to offer customization. However, customization means that the work isn’t scalable, and if it’s not scalable, it isn’t very profitable. Instead, web design firms will prefer to work with bigger customers, who will have deep enough pockets to pay for a truly customized experience, and remove the need for these firms to worry about scalability. As the web design firms focus on the high end, SMBs will naturally look at other forms of web presence.

The final reason we’ll see a shift away from websites is that the new forms of web presence come with a pre-existing method for generating traffic. One of the biggest issues SMBs have with standalone websites is that they pay good money for them, but then once they’re built they need to spend more money to get people to visit the them. The standardized web presences often come pre-packaged with at least one method to be found. Registering with Google Local Business Centre makes you eligible to appear in Google’s local search results. Creating a Facebook fan page allows you to easily attract word of mouth traffic by spreading word through your Facebook friends. Creating a profile with an internet directory means that anyone using that directory will be able to find you.

In my next post, I’ll look a closer look at some of the options for setting up a SMBs web presence.

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.

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.