Category Archives: Sales & Marketing

How Do You Build Market Awareness on a Small Budget? Seven Ideas

Situation: A small technology company has a handful of major customers. They are very good at what they do and want to expand and diversify their customer base. The challenge is that they don’t have the funds for large-scale marketing.  As an additional twist, for now they prefer to stay under the radar of their largest competitors.  How do you build market awareness on a small budget?

Advice from the CEOs:

  • Start with the basics. Define your market niche and build from there.  Create a beachhead in this niche and generate strong testimonials from your current customers.  Segue to tradeshows and broader marketing opportunities as you build marketing strength.
  • You already have several marquis clients. Look for opportunities in other divisions within these client companies. The work that you have done for existing divisions makes you credible.
  • Network with your current clients to develop other opportunities. They won’t want to help their competitors; however, if you can improve what they receive from their other vendors they may provide introductions for you.
  • As a small company, focus on a single market where you have strength and credibility.  You don’t want to spread yourselves too thin.
  • Find a good customer and solve their problem well. Create an evangelist who will tell others about you.
  • Look for speaker opportunities at high visibility events within your market niche.
  • Consider webinars, these are inexpensive and if you promote them to decisions makers in your target niche you can quickly build credibility.

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How Do You Respond to a New Competitor? Six Options

Situation: A company performs service that is primarily locally-based.  A competitor is establishing a new site less than two miles from the company’s location, offers a broader array of services and is larger than the company. How can the company protect its business by responding to this new competition?

Advice from the CEOs:

  • Your most important asset is understanding what you are doing right, and what is most important to your customers.  Remember that business is more than just a product or service. It’s a relationship. Your customers depend upon your for more than just what you offer for sale. Reach out to your customers for these answers. Make sure that you respond to their needs. As a benefit you may also find new growth opportunities.
  • Ask current customers whether you need to expand your service offering, or whether your current offering and lead time is acceptable to them. Ask how their needs are changing and how you can better serve them.
  • Reestablish the connection to your customer and listen. Preempt new competition by contacting your customer base before the competitor gains a stronghold.
  • Study your options and avoid knee-jerk reactions.  You may be in better shape that you think.
  • Major retailers and service companies have moved into many locations. Local businesses who survive their presence do so because they are focused on their customers’ needs and are better at serving the customers that the big companies are.
  • Invest in key components of your business relationships:  services, payment terms, responsiveness, your facilities, and so forth.

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Does It Still Make Sense to Off-Shore? Seven Suggestions

Situation: A company is investigating off-shoring to lower costs. Trends are confusing with some companies returning operations to local production and others continuing to offshore. In addition, options include partnering with an existing company with expertise, or developing off-shore resources themselves. Does it still make sense to off-shore?

Advice from the CEOs:

  • Instead of looking at broad trends, narrow your focus to what other companies in your industry or closely related industries are doing. You can get this from industry publications and trade associations, as well as from other companies with whom you have personal relationships. This will help to clarify trends that potentially impact you.
  • Consider whether there are complimentary objectives that will influence your decision. For example, do you want to expand your market presence abroad and would off-shoring operations help you accomplish this?
  • Look at other US locations – for example the Midwest. Midwestern moms working from home provide high quality customer service for Southwest Airlines. Part- or flex-timers may be less expensive than full-timers.
  • Make this move in steps. Consider breaking up your needs into distinct components and outsourcing each component from a different provider or vendor. This will help to preserve your “secret sauce” and corporate IP resources from those who might want to steal it if they saw the whole picture.
  • Good off-shore functions utilize as little management as possible. Distinct tasks are easier to off-shore than complex processes.
  • Look at scalability issues – based on your own past experience.
  • Tie the resources that you need to what is readily available in different geographies.

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When is “Good Enough” Enough? Five Factors

Situation: A company is about to launch a Beta version of their web-based software. The CEO strives for perfection. What is sufficient for launch, and can the company tolerate imperfections in Beta version? When is “good enough” enough?

Advice from the CEOs:

  • Many successful software companies – think Microsoft – have realized that finishing the last 10-20% of a new release can be as expensive and time consuming as the first 80-90%. The challenges are often greater and it’s difficult to prioritize the final pieces. So they release when the software is 80-90% complete, prioritize the final pieces based on user feedback, and focus on quick response to user feedback.
  • You really have no idea how users will experience a new web-based program until you hear it from them. They will tell you what does and does not need to be fixed. They may even be able to help you fix it! Craig’s list stinks from a pure GUI perspective, but is highly popular and successful.
  • Get the Beta program out ASAP. What you perceive as imperfections may not appear as problems to young Beta users, and may in a way add a quirky appeal to the user experience.
  • Find a customer or group of customers who will pay for the program. Only this proves its actual worth. There can be conditions for a Beta release and discounts, but if nobody is willing to pay, where is the value?
  • Consider releasing your Beta version in a college campus environment and invite both participation and feedback. College students are very web-savvy, more tolerant of Beta programs, and crave the opportunity to contribute.
    • As an additional bonus, when you are ready to launch, college students are great at helping you generate buzz and early adoption because they talk to so many of their friends from both college and high school.

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How Do You Tell a Client That They’re Wrong? Five Factors

Situation: A company’s client is furious at the service they received from the company, It turns out upon investigation that the source of the client’s difficulty arose from their own actions, not from anything done by the company or its employees. How do you tell a client that their assumptions are wrong?

Advice from the CEOs:

  • Ask open-ended questions in an attempt to “clarify your understanding” of what happened. You want the client to answer these questions so that they explain the situation to themselves. Always allow them to save face in this process. Some people are better at this technique than others.
  • Try to understand the client’s experience of the problem as opposed to focusing on the problem itself. This may reveal more deep-seated challenges facing the client that are just being expressed through the current situation.
  • Email communications often complicate these conversations. Call or visit to let the client know that you are responding personally to their concern. The best communication is person-to-person through conversation. Let them vent. Peel back the onion through questioning to reveal the core problem.
  • Be honest. Not negative but simply honest. Listen to gain understanding and repeat the facts, as stated by the client, to assure that you properly understand their perspective. If you need to present your own perspective, and it differs from the client’s, do this in a neutral, unemotional tone.
  • Sometimes you will find a win-win in these discussions, and sometimes you won’t.

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How Do You Mature an Ad Hoc Sales Effort? Four Factors

Situation: A company’s sales process is currently ad hoc with a 20% close rate and an unpredictable pipeline. The CEO wants to develop an organized sales effort. How do you mature from an ad hoc to an organized sales effort?

Advice from the CEOs:

  • Use the same discipline that you use to develop and bring new products to market to develop and engineer an organized sales effort. Start with a clean slate. Develop a full business plan and process to support your sales. Set projections and milestones, assign responsibility and accountability, and hold regular meetings to monitor progress and adjust your tactics.
  • Utilize the company’s knowledge of the market and your customer base to better understand your sales efforts to date. For example:
    • Look at your sales history, and look at the cases where you have closed business. Are there commonalities or patterns among clients with whom you have won new business?
    • Similarly, look for patterns in situations where you did not close new business.
    • Look for a sweet spot which characterizes business deals that you’ve won. If you find that in past efforts there is a segment where your close rate is higher – perhaps among clients of a particular size or in a particular industry – hire a sales executive who has a history of success in this segment of the market. This will improve your close rate and provide a base from which you can expand your sales efforts in a planned and orderly way.
  • Determine your most important market differentiation – what makes you special – and validate this with current and past customers. Make sure that your differentiation is as important to clients as it is to you. If it isn’t find out why clients chose you rather and your competition.
  • Is your sales process reactive or proactive? Until you truly understand your market, it is reactive. Once you understand where your sales efforts are most effective, improve your knowledge of this segment of the market and focus both your sales and marketing efforts here to boost your results.

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What Leads in Building Brand Focus? Five Factors

Situation: A company faces a question branding a new product – what should lead the branding focus: product design or product attributes that will be an eventual part of the branding strategy? Which should lead in building brand focus?

Advice from the CEOs:

  • There are two areas of focus – each an important part of the overall trademark and branding strategy:
    • A distinct name or symbol, for example Amazon.com or eBay, will gain the right kind of attention and be easy for potential customers to remember. The prime risk here is stepping on someone else’s mark.
    • Your overall branding strategy. The point here is not confusing your customers. Marketing people will advise you to KISS – Keep it Simple Stupid! One tack is simplifying the complexity of technology.
  • It is important to develop a consistent set of product attributes – one that you know through research will resonate with your client base – before your Alpha launch. It is dangerous to conduct an Alpha launch without clarity on this point. Subtleties of the eventual brand do not need to be finalized, but the overall framework of key product attributes should be consistent and clear from the beginning.
  • Design and the development of important product attributes ideally take place in synch with each other. Positioning will depend on your audience, and the unique needs and expectations of the audience.
  • The name itself could be important. Being clear and easy to spell may be important. Test alternative names for this trait.

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How Do You Respond to Market Changes? Three Options

Situation: A company has a successful product, but the market is changing. Previous customers were savvy, but the market is shifting to more naïve customers who don’t understand how to use the product. How so you respond when the market for your product changes?

  • What you are seeing is a typical market evolution. (See Clayton Christensen’s book Crossing the Chasm.)
    • When a new product is introduced, early adopters are typically savvy users who quickly grasp the utility of the product. They don’t mind some inconvenience provided the product is useful.
    • As the market matures and starts to attract mainstream customers, new users will not be as sophisticated and expect the product to be easy to use.
    • If you don’t adapt to these new customers your product will languish as new competitors enter the market with user-friendly adaptations.
  • The path is clear. Figure out how to make your product easy to use. If you use a GUI (graphic user interface) make the GUI intuitive. Allow customers to get what they need with as few choices or clicks as possible.
    • These changes may alienate more sophisticated customers, but they usually only represent a small segment of your potential market.
  • Add a customer-friendly service component. This builds a service income base around the product. You have different options.
    • Align the customer with appropriate level of resource – you may not require high level resources to assist the customer, particularly if the product is one where the service consultant only needs to be one page ahead of the user.
    • Outsource the service component to a partner or use independent contractors.
  • Consider a remote monitor system:
    • A dashboard interface with easy to read visuals or messages that tell the customer when service is needed. This will enable them to perform simple maintenance using your tools, or alert them when they need to contact you for service.
    • An example is Norton’s evolving system of products that enables an unsophisticated home computer user to either use Norton tools to perform routine maintenance, or directs them to the Norton web site for assistance or more sophisticated solutions.

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How Do You Identify New Customers? Four Alternatives

Situation: A company wants to expand its markets and customer base. Currently their business is dominated by a single customer. What best practices have you developed for identifying new customers and markets?

  • The key to getting new customers is to devote dedicated time to this task.
    • If your company is populated by engineer or software specialists, consider hiring a sales professional – a commission based hunter sales person who has experience landing big accounts in markets similar to yours. You may pay this person a good percentage of sales for brining in this business, but gaining the additional business can be worth it.
  • Much depends upon your relationship with your large customer. When a single client has rights over or ownership of the technology of the company but is not pursuing broader markets that the company is interested in, is it feasible to negotiate rights to pursue this business?
    • The larger client will pursue their own interests, not those of the smaller vendor. Perhaps a win-win deal can be worked out, but it may be difficult – particularly if the larger client is concerned that use of the technology in other markets could affect its interests in their primary markets.
    • Be very careful in this situation. The easiest tactic for the larger company to defend itself from a perceived threat is to sue and simply bury the smaller vendor through legal expenses. While the smaller company may be legally within its rights, deep pockets can beat shallow pockets through attrition.
  • In the case that the larger client simply continues to buy all capacity of the smaller company, an alternative is to raise rates, or perhaps to just say no.
  • Consider recreating the opportunity – create your own adjunct proprietary product with your own software or design talent and expand your horizons with this product.
    • Be aware, the large client can still sue if there is any appearance that your proprietary product impinges on their product rights. As in the case above, the larger company has the resources to bury the smaller company in legal expenses regardless of who is legally correct.

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How Do You Respond to a New Big Competitor? Four Strategies

Situation: A company has just learned that a new, much larger competitor is moving into their market. They are concerned that this may severely impact their growth and even their existence. How do you respond to new competition in your market niche from a much larger new entrant, particularly if the new player comes in with a low pricing strategy to buy market share?

Advice from the CEOs:

  • Take a lesson from those who survive a move by Walmart into their territory:
    • Boutiques and high service specialty stores survive Walmart – especially those that focus on personal service. Walmart does not provide the level of service that you find in one of these stores and doesn’t know their customers as individuals. Boutiques may lose some price conscious customers, but these are not the customers that provide good margin to them.
    • Use your personal knowledge of the marketplace and your long term relationships to your advantage – including your reputation with existing customers when going after new customers.
    • You may remain more profitable than the larger company, especially on a per transaction basis, based on your knowledge of the territory or business niche. Walmart can’t tell you the best product to perform a home repair.
  • Focus on your strengths in the market, and don’t assume that all large companies are Walmarts. Walmart has a unique set of talents and a tightly controlled process. This may not translate to other markets – especially services which are very personal.
  • Research the reputation and business practices of the new entrant in their other territories. What are they known for, and what are their weaknesses? You may be able to learn this by networking with their current competitors and customers.
  • If you are a multi-generation family business, consider promoting your “old world skill” and established reputation and expertise.

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