Category: Consulting with Small Businesses

I’ve been dabbling with the new “social media” app called Foursquare. It seemed, from the very beginning to be a great app to help small businesses reach new customers.

So I decided I’d not only try it out, I’d jump in and do everything you could do with it so I could really see how small businesses are using it, and perhaps be amongst the first to know of any changes or monetization ideas.

To some degree Foursquare is a game.  For small businesses, that may make it hard to conceptualize as a revenue generator. But the game involves GPS in mobile phones, which means people must find you in order to play.

If you’re small business goal is to increase exposure,  then Foursquare might be a small part of that strategy. From the game perspective, that only works if checking into your business contributes to the player achieving a Foursquare goal like attaining a new Foursquare Badge.

(By the way, it’s really a mobile phone scavenger hunt where “badges” are the prize and “check-ins” are the requirements.)

So far some big companies have been able to get their own badges, like Lucky Mag, Explore Chicago, Mountain Dew and Zagat’s. For the small business, that hasn’t been an option.

But the other side of Foursquare is where small businesses have made some headway.  The person who checks in the most times at an establishment gets labeled as the “Mayor” of that location. Places like Starbucks are honoring Mayors with 15% off at the register.  Get your customers competing to be the Mayor – and perhaps you’ll increase the number of times your regulars show up.

For some businesses (like this one), Foursquare has been a tremendous asset to their bottom line.  But the ease of “check-ins” make me wonder.

In my quest to get all the badges being offered by companies and Foursquare, I’ve noticed a few things.

1. You can check-in without going inside and sometimes being as far a city block away. Occassionaly I ran into a pop-up that said “Whoa, you’re too far away to check-in”, but it is rare.
2. You can drive around like in a scavenger hunt and check-in at all the places you need to. (Though there is a pop-up if you check in to several too quickly).
3. If you’re GPS shows you to be somewhere else, because of a glitch, you can check-in wherever your phone thinks you are. But if your GPS rights itself and you check in again locally, you’ll get a “Whoa, you couldn’t possibly have traveled that fast” pop-up.
4. Finally, it’s hard to check-in if you’re business is in a building that inhibits your phone GPS from working. That’s the most frustrating part.

There’s little downside to listing your business on Foursquare. Probably the very best thing is knowing that anytime someone checks in within a 1,000 meters, they have a chance to see that you’re a nearby business – which they may have never known before.

If you’re “playing” foursquare and have some ideas for small businesses – leave them here and let’s chat about them!

Somehow, overnight it seems, flat screen TV’s are no longer available as an upgrade. Nope. Now flat screen is the default. In fact, if you want to buy a regular cathode ray tube TV, you’re going to have to go to an electronics store, or eBay or Craigslist. Because, Wal*Mart isn’t going to special order it for you.

I don’t recall it, but I imagine there was a day that color TV was the default – not just an upgrade option.  Just as there was a day that CD’s replaced tapes, and the automatic replaced the stick. In fact, can you find ice cream makers that require you to hand crank them? When is the day that all banks will have drive-thru’s?

Change is inevitable. The question is whether or not your small business is ready for the change? Just think about the simple things like popcorn ceilings that really make you look old and out-dated. How about business cards that don’t feature your e-mail or web address? And are you prepared to have a corresponding Facebook page should that become the norm?

Keeping up with technology is hard – there’s so much of it. But because it changes rapidly, you can begin to lose customers just because your technology is outdated – and thus foreign to today’s consumer.

Check  your website, is there a “contact us” tab? If not, perhaps there should be because everyone expects to find the hours, e-mail and phone number there. It’s no longer an add-on – now it’s the norm. Is your main web address a hotmail account? Today’s savvy youth see that as cheap and out-dated. Make sure to get info@yourdomainname.com right away.  Finally, are you ready to book appointments, sell products or communicate with your customers through your website? Soon enough the lack thereof won’t be tolerated.

Doesn’t sound like sitting on your hands is helping does it? What else is becoming the norm? More importantly – are you ready to grasp it? Leave your web address, we’ll look it over and tell you what we think about your site and the future “norms”.

Ever seen Dog the Bounty Hunter? He’s a Harley-looking dude in Hawaii who goes around rounding up the bad guys. But he doesn’t just round them up, he takes them down with style. Duane “Dog” Chapman and his family have turned their little bounty hunter enterprise into a full blown reality TV sensation. Since 2005 Dog has also turned up as a guest star on other popular shows as well.

Alright, enough with the show prep. What has that got to do with your local business? Well let me answer that with a question. If you live in Hawaii and need a bounty hunter who are you going to call? I’ll answer that for you, you’re going to call Dog the Bounty Hunter because he is the expert.How did he become the expert? He did it by allowing you to see what he does for a living – but more importantly he shows you how he does it.

There’s a roofer in Maryland who has achieved the same “expert” status in his community. He didn’t have a TV show though. He, like you, has YouTube. He films himself everytime he gets on a roof to make his initial inspection. He films the roof while talking about the problems he sees and the solutions required.

He’s created so many films that he’s featured prominently when you search for his local keywords. That ability to prove yourself by allowing others to see your expert knowledge creates a level of trust, appreciation and credibility. Not only that, but he uses the video when he talks to the client and proves to them he understands their problems and necessary solutions.

Become the Dog of  your community. Plan your work and turn it into a marketing and teaching moment. You’ll revel in the appreciation your local community shows and accomplish your marketing activities while you’re getting your work done.

Structuring your social media platform as a business gives you an opportunity not available to a consultant or sole proprietorship. While I spend a good deal of the time branding my own image, a company has the option of allowing it’s “employee faces” to brand themselves as employees or to make the “employee faces” anonymous giving all the credit to the company. Continue reading “The Structure of Social Media for Small Business”

So you’ve got a website and you’re proud of it. In fact, many of you were probably excited to tell people once it was up and going.  I’ve got some questions for you. What is it for? What does it do? How do people find it? How do people use it? Do you know the answers to any of these questions? Continue reading “Does your company website make sense?”

So you’re familiar with Groupon, I’m going to assume. It’s a great service for those of us that like 50% off – but like many lead generating services you’ve got to be prepared on the back-end.

Most companies that use Groupon get excited about all the traffic that’s coming to their front door, but don’t realize that unless that traffic is harnessed or brought back somehow, it can be a really big money losing proposition.

Groupon customers pay 50% for a service. So $20, for a $40 service. The company providing that service gets 50% of the $20 – so $10. Basically they sell a $40 service for $10. That only makes sense if your cost of goods is much less than $10 and if you’re able to make additional sales from the traffic.

And that’s true for any special or giveaway that you put together.

To make a Groupon or other giveaway a success, build the backend first. What do you plan to offer the customer next? How are you going to capture their information if the service your using isn’t going to give it to you? How are you going to harness their original interest and turn it into something bigger?

Many, many companies have complained about Groupon and have decided they would never do it again. While others flourish and do them over and over. Don’t let the tail-end catch you by surprise.

Build it in its entirety and then figure out how you’re going to get the customers into the funnel – whether that’s Groupon, banner ads, postcards or a blimp.

I’ve got a couple Groupon Case Studies on my blog: http://lettersfromdan.com/examples-of-bad-social-marketing-decisions/

So many horror stories, and yet they can all be avoided. Learning how to use Groupon for your business really means . . . what do you know about your business?

How do you make money?

The first step in using Groupon for your business is understanding where money is made in your business. For most businesses, a customer’s seventh purchase is more profitable than the first purchase because of the media cost required to acquire them as a customer. In that case the money is made in repeat buyers.

Some business owners understand that if they can get a customer to come in a 5th time, that customer will likely come in many more times. They may have detected customers who don’t make it past 4 just don’t have the same proclivity to shop there regularly as the ones that make 5.

In some businesses the money is made in large items. For example a watercolor painting store may really do well selling the large canvases and specialty brushes, whereas their paint-by-number and smaller painting kits don’t have the same margin. For restaurants that may translate to big money in catering dollars compared to the high cost of the single slice pizza customer.

Part of learning how to use Groupon for your business is understanding what kind of customer makes you the most money – and what is it about those customers that are different than the rest.

Defining the strategy

Before we get to Groupon, it’s imperative to understand the path that someone takes from before they know you exist until they are buying your high margin items. How does that path compare to the customers who never make it to the high margin items? Drawing or tracking the path that your customers take on that journey will give you great insight into what types of marketing you should be doing.

While it’s not easy to do, tracking the source of your customers over the long term makes enormous business sense and well worth the money spent. For a cleaning company it would be great to know if the “get your bathrooms squeaky clean” or “spend time with your kids, hire a maid” produced the most profitable batch of customers.

Crafting the Deal

If your ideal client is the mom who buys a full year of gymnastics lessons, because that parent is likely going to buy 2, 3 and 4 years of gymnastics lessons, then it makes sense to create a special that encourages mom’s to buy a full year. Whether that special is on a flyer, in Groupon or through e-mail it doesn’t really matter. Anyone gained through that effort is likely to be a customer for the next 4 years.

Suppose it is the large, blank canvas buyer that makes you the most money. . . If that’s the case, is it the beginner painter or more intermediate painter who takes on a large canvas painting? If it’s the more advanced, perhaps creating an offer for a very specialized art technique class would appeal to intermediate painters – the ones who buy the big canvases. An “intro to painting” class may not be as lucrative in the long run.

For the businesses that need customers to come in that magic 5th time to make all the difference, perhaps the strategy is to get a loyalty rewards card in their hand, which offers a discount or free item on their 5th visit. Defining the type of customer that takes and uses loyalty cards is what’s to be decided then. That’s whom you direct the deal or special.

The messaging in the special, whether it’s Groupon or not, is critical to the success of the marketing. There’s a huge difference between a list of serious, intermediate artists who’ve bought at your shop versus a list of beginner artists who just wanted to try their hand at painting. Which list can you monetize later?

Using Groupon

Determining how to use Groupon for your business comes down to what you can afford to pay to acquire customers who fit the mold of your most profitable ones. If that gymnastics mom is going to spend $2,700 over the course of 4 years with you, would it be worth spending $150 to acquire that customer?

Groupon doesn’t work too much differently than ValPak, Yellow Pages or Billboards. If you post the same deal at all 4, you’ve got all the same expenses- just allocated differently. With Groupon, you may be offering $75 of services for $30 – which means you end up with $15. If you did that same ad in ValPak, Yellow Pages or on a Billboard, you’d get the whole $30 from the customer – except you’d have to write a check later to pay for the media. Either case you end up with $15.

The key to Groupon is starting slow. Create a deal that isn’t super fantastic, like $75 worth for $55. You might go broke doing $75 of value for $5 – and attract the wrong customers. Then try at $45 and see who that attracts, if not enough lower the price to $35 the next time and see what that brings in. Test. Test. Test.

If you play your cards right you’ll craft a deal you can sell anywhere, anyday, anytime and hopefully everyday.  And the testing you get through Groupon can certainly be repurposed into your Yellow Page ad, your Billboard and anywhere else you advertise. The only other problem you have to consider is cash flow. But that’s a different discussion.

Being a social media for offline business guy, I take special note when anything local businesses are doing online and making visible to the customer. This weekend I had the pleasure of dining at MaggieMoo’s on West End in Nashville and thought I’d share that experience.

MaggieMoo’s is the first place I’ve been where their social media marketing efforts have gone beyond a Facebook sticker on the door. For the first time ever, an employee contributed positively to their efforts (unlike my example at Daily’s Gas Station).

Next to the register they have an 8 x 11 stand-up flyer suggesting customers “like” them on Facebook (as you’re about to do with the button at the bottom of this post :)) – but they didn’t stop there. The employee actually pointed out the sign, suggested that I “like” them on Facebook and added “Do so before March 15th because we’re giving away free ice cream that day”.

[stextbox id=”info”]Social Media Marketing is about 2 things:

• Engagment and Community
• Driving Traffic to take action[/stextbox]

What a breath of fresh air that was. Promotion, scarcity, likability and a knowledgeable employee. However, social media for offline business is still a leap. With 4 kids in tow, MaggieMoo’s was asking a lot of me to remember to go to Facebook and “like” them the next time I logged in. And since they didn’t gather my contact information, they didn’t have any way to remind me.

So at this point they’re relying on “hope”.

Unfortunately, hope comes into play again with their Facebook strategy as well. Since they haven’t uploaded any special, custom pages – they still don’t have a way to grab your contact information (which is the Gold in marketing). There’s no place to put your e-mail address or anything. And since you can’t message all your fans at the same time on Facebook – they don’t have a real good way to get me back to their FanPage – other than hope.

When you press “like” you’re taken directly to the wall where they pretty much post specials and promotions. I did find mention of the “free ice cream” down the page a bit, but there’s a disconnect immediately without seeing that promotion front and center.

That covers gathering contact information, but I’d also like to see them working to create more of a community on their page.  I love that they posted a photo of one of their truffle cakes, but I would like to have seen them “tag” the person whose party it was eaten at. Maybe even start a “tagging” promotion for people who upload their party photos.

I’d love to see discussions about the best ice cream cake stories, or messy kids with their ice cream cones.  Perhaps questions like what’s your favorite “mix-in” ice cream flavor, or name this mix-in recipe, or even stories of ice cream cakes that melted before they could get eaten.

Social media is about taking a group of unrelated customers and turning them into a community of fans. But a marketer must recognize the temporary nature of everything on the web. How good is 1,00o friends on MySpace right now? Without moving people from Facebook’s world to your own list – you end up with nothing for your efforts.

At least at MaggieMoo’s – you started out with great ice cream.