The importance of creating a brand for your startup business

March 31, 2009 Leave a Comment

 

There are few certainties when it comes to launching a new business, but one of them is starting with zero customers.  This fact alone is what deters many would-be entrepreneurs from taking the plunge.  Without customers there is no income, and without income…well, you know how that story ends.

For those who press ahead anyway, good for you.  Now the sales cycle begins.  And for your prospective customers that cycle includes an information gathering stage, a shopping stage, and a purchase stage.  The key for your startup is to stand out in each of these stages, gaining a measure of relevance along with way.  How do you do that?  One important way is to insert your brand into the mix.  That’s because your brand makes selling easier.  It conveys a promise – before, during and after the sale – that builds trust around what you do and how well you do it.

The benefits of branding to the sales cycle are numerous.  Your brand builds recognition and name awareness in the marketplace in advance of the sale, which leads to increased selection of your product or service over competitors.  It also builds equity for your business in the form of premium pricing and customer loyalty.    It raises your product or service above the level of being a commodity, which helps reduce churn and protects your profit margin.  And finally, it increases the odds that your business will survive and prosper.

So make sure that building your brand is a part of your business plan.  Weave it into your product definition, your positioning, and your messaging.  Realize that shaping your brand’s perception requires persistence – so stick with it.  And know that there are lots of people who can help you with your branding strategy including PR and advertising firms, logo designers, and web-site developers to name a few.  But remember that you control the key ingredient, which is what your product or service stands for and the benefits it transmits.  That is your brand.  Others can help you message it, but you need to be it first.

Filed under advertising, Business, Marketing, PR, Sales, Startups & Entrepreneuring Tagged with , , , , , ,

Is online advertising failing or is it just the recession?

March 23, 2009 Leave a Comment

Eric Clemons has just written a very thoughtful article on “Why Advertising Is Failing On The Internet” on TechCrunch. His high level argument is that the Internet shatters all forms of advertising because it allows consumers to bypass them. He provides evidence for why people don’t trust ads, why they don’t want them, and why they don’t need them. He then goes on to illustrate how the Internet provides ways for people to meaningfully get the information they need without them.

He then moves quickly from advertising to the ecommerce space where he talks about new monetization models around selling real things, selling virtual things, selling virtual experiences, and selling misdirection (a subject where he expresses a lack of faith in Google’s revenue model and sustainability.)

Unfortunately, he falls short in the end of providing a list of concrete replacements for advertising. Can you really imagine a world without ads? Surely they will exist, perhaps in different forms, but they will be omnipresent.  In addition, he sites declining online ad revenues to support his thesis at a time when the culprit may be nothing more than the current recession. Whatever the outcome, his sweeping approach to the landscape of online advertising bears reading.

Filed under advertising, eCommerce, Marketing, Retailing Tagged with , , , , , ,

Local ad spending expected to decline through 2013, interactive segment the only bright spot

March 17, 2009 Leave a Comment

According to the BIA and The Kelsey Group, economic conditions over the next few years will reduce overall local advertising spending through 2013.  Local advertising revenues in the United States are expected to decline from $155 billion in 2008 to $144 billion in 2013, representing a negative 1.4 percent compound annual growth rate.

Only one segment is expected to show growth over that time, which is interactive advertising.  The others should see marginal or rapid declines over the next 1.5 to 3 years. 

Tom Buono, president and CEO, BIA Advisory Services, sees an accelerating shift to online and an increasing demand for “accountability metrics”.   According to the survey, interactive share of local ad spending will grow from 9 percent ($14 billion) in 2008 to 22.2 percent ($32 billion) in 2013.   For purposes of the survey, “interactive” includes mobile, Internet Yellow Pages, local search, online verticals and classifieds, voice search, and email marketing.

In contrast, the “traditional segment” is expected to decrease from $141.3 billion in 2008 to $112.4 billion in 2013 (CAGR of -4.5%).  This area includes newspapers, direct mail, television, radio, print Yellow Pages, cable television and magazines.  Neal Polachek, CEO of The Kelsey Group, indicates that the share shift “could actually be more pronounced if the major traditional media are not able to integrate new interactive products into their bundle.”

With yet another major print newspaper (the Seattle Post Intelligencer) closing its doors, the transition already feels very real.  If traditional media companies are to thrive over the next 10 years they will need to continue to embrace interactive strategies far more aggressively.

For more information about the survey and its methodology, click here.

Filed under advertising, Business, Economy, Marketing Tagged with , , , , , , , , , ,

Focus on being a niche web site to earn higher eCPMs

March 16, 2009 Leave a Comment

 

Don’t let what happened to AOL happen to you.  AOL’s broad-based content mix including news, weather, sports, music, tv, movies and dozens of other categories meant it was good at one thing in terms of making money:  selling remnant advertising across its network.  That “success” probably helped hasten Randy Falco’s departure as CEO.

Without strong niche brands and content, AOL was never able to aggregate demographically targeted audiences in a way that advertisers were willing to pay a premium to reach.  So their sales people did what sales people do, they took lots of orders for low cost run-of-network ads.  In the last few months AOL’s now deposed CEO had made a push to move the business in the direction of niche content and premium ad-buys, but with little success.  As a result, he’s gone and there is a new sheriff in town – Tim Armstrong of Google.

The double-negative with launching a broad-based content site includes a) being of no interest to advertisers until you have lots of traffic volume, and b) once you get that volume being so mainstream as to be of little strategic value to buyers.

If you already have lots of content covering a variety of categories, consider launching individual destination sites which will have immediate appeal to both niche audiences and advertisers.  Replicating web sites is inexpensive these days, and the premium ad revenue should be worth the extra effort. 

If you are just starting out, think small to earn big.

Filed under advertising, Business, Editorial/Content, Marketing Tagged with , , , , , , , ,

What does it take to start an online B2B community?

March 10, 2009 Leave a Comment

 

A typical B2B community is one that is created by a company intent on reaching and connecting customers to a) the organization or b) each other.  And it starts by asking a question – what do you want to build the community around?  More succinctly – what are your goals?  For some firms it is a stated desire to get feedback from customers or partners and make a closer, ongoing connection with them.   For others it is to reduce costs by having customers help other customers.  Still others desire to market to their customers in new ways using the latest social media tools.  Whatever your goal, be sure to define the “what” of your community before investigating the “how”.

bridgeAfter defining the goal (customer loyalty, lowering support costs, feedback, keeping customers informed, etc.) the next step is put a small team of people together who are highly motivated to seeing the community come to life.  Like many Web 2.0 communities, the best ones are built around the notion of high focus, high tailoring, niche-type destinations where collaborators can easily engage. 

Early on your launch team will want to do two things.  The first is to identify the key influencers who should be invited to join the community and whose presence will inspire others to join and participate.  The second is to pre-seed the community at launch with topics and conversations that relate to the overall goal.  But note that very quickly the team should be prepared to step away from micro-managing the conversation and let the community organically shape the content and topics on its own – because it will.

What about ROI?  In many B2B communities the ratio for those visitors who read versus those who add content is roughly 25 to 1. This means that every successful interaction potentially influences another 25 visitors on average.  Since influence is often correlated with purchase intent, start with the proxy that 2-5% of sales made to community members were influenced by the community itself.  Then you can refine the proxy value by surveying your members.  And for those B2B communities engaged in self-service customer support the cost avoidance equation is just as straight forward to measure.

However, the best thing about online B2B communities is that they are (in essence) the daily expression of what used to be annual or sporadic conversations of a highly important and valuable nature.  So putting a ROI on this part of the model is much more qualitative.  But there is little doubt that if your business can leverage the opportunity to connect important constituencies together in a real-time fashion, you will gain timely insights, customer credibility, and improved profitability (via increased sales, decreased costs) that otherwise were going untapped. 

Filed under Editorial/Content, Manufacturers, Marketing, Retailing, Sales Tagged with , , , , , , , , , , ,

Google announces expandable ad units to improve click-through rates

March 6, 2009 Leave a Comment

In an industry where display ads enjoy 0.25% click through rates and low CPMs, Google is stepping up the footprint of its Adsense units with the introduction of expandable rich-media ad units that grow larger after a user clicks.

Google is being careful at the moment to restrict the expansion to only when users click on the ads (some competitors allow it happen on simple rollover), and holding the size of the expansion to 2x the original width and height.  In addition, filters allow publishers to opt-out of having certain advertiser ads show up on their site.   This is the second relaxation of standards for Google ads in recent months.  In December the company allowed ads for alcoholic beverages to run in Britain. 

For more information about the new ad units and Google’s overall policies, click here.

Filed under Marketing, Search Engines Tagged with , , , , , , , ,

Consumer demand for in-home entertainment helps make premium cable recession resistant

March 4, 2009 Leave a Comment

As reported by Paidcontent.org, cable operators and networks are faring better than ad-driven media companies in the recession, thanks to subscription revenue.  Profits at Time Warner’s HBO and Cinemax grew more than 10 percent during the fourth quarter of 2008, and the networks ended the year with their highest subscriber total ever—40.9 million.   Revenues at Showtime and Starz were also up in Q4 at 6% and 8% respectively.

Why? The mix of factors includes aggressive bundling, more online and mobile promotion, an increased interest in-home entertainment.  If cable operators are to begin to feel the pinch it will be when the lag time between troubles at home and subscription cancellations is exhausted.  For the full story click here.

Filed under Business, Economy, Editorial/Content, Marketing Tagged with , , , , , , ,

Survey Shows Frequent Online Shoppers Respond to Personalized Ads

February 5, 2009 Leave a Comment

 

ChoiceStream, a provider of personalized product and display ads for large retail and entertainment brands, released their latest online personalization survey.   In it they indicate that retailer’s most attractive prospects–those who spend the most money and shop most frequently–are more likely to click on personalized ads than non-personalized ads.

choicestream1Overall, 39 percent of consumers are more likely to click on an ad if it is personalized – a meaningful percentage in its own right.  But the number climbs to 58% for those who shop online at least several times a month.  And the bigger the spender the greater the interest in personalized ads, with 50% indicating they are more likely to click on them.   Contrast this with only 22% of infrequent shoppers who make that claim.  In addition, 50% of the biggest spenders indicate that they are more likely to click on personalized ads than on non-personalized ones, vs. 32% of the smallest spenders.  

The data also supports a similar pattern in terms of consumer attention to the ads.  Over 41% of those surveyed indicate that they will pay more attention to advertising if it is personalized based on their tastes and interests.   That number increases to 49% of consumers who spent more than $250 online over the past six months, and falls to 36% for those who spent between $1-100.

The survey was completed by 504 online shoppers across a variety of age categories.  The bottom line is that if you are a retailer or manufacturer with loyal customers and those customers shop online and spend over $100 with you, personalized advertising that exposes products they are interested in can yield positive results.

To see a summary of the ChoiceStream survey, click here.

Filed under eCommerce, Manufacturers, Market Research, Marketing, Retailing Tagged with , , , , , , , ,

Are You Marketing Gravity or Evolution? Seth Godin Says Knowing the Answer is Smart Marketing

February 4, 2009 1 Comment

 

Here’s a snapshot of how Seth describes it:  Everyone believes in gravity.  Evolution has its share of doubters. 

fallingappleSo what does this have to do with marketing?  Two things, he says.  First, “If the story of your marketing requires the prospect to abandon a previously believed story, you have a lot of work to do.“ Since the gravity story has no detractors, then attaching your new (idea, product, company) to it is smart marketing. 

Second, “If the timeframe of the message of your marketing is longer than the attention span (or lifetime) of the person you are marketing to, you have your work cut out for you as well.”  Try selling evolution.  It is really slow and hard to demonstrate in real time during a school board meeting.  Gravity on the other hand is instantaneous.  Just drop your shoe.

Seth goes on to suggest that the iPhone is gravity marekting.   People had already accepted that they wanted it, you could see it work from across the room, and you didn’t have to wait months for the joy to happen.

So here is how Seth says you should put it into practice.  First, “Try to tell a story that complements an existing story rather than calling it out as false.”  Second, “Try to make the ‘proof’ as vivid and immediate as possible. Like an apple falling on your head.”

Net-net, if you don’t have a ‘gravity’ element in your pitch, strive for it. 

For the full article from Seth, click here.  It is worth the read.

Filed under Marketing, Sales Tagged with , , , , , , , ,

Loyalty Cards Getting Smarter Means Couponing May Be Getting Better

January 26, 2009 1 Comment

 

Kroger (the nation’s largest traditional grocery chain) and dunnhumby (the British data mining company) have created a joint venture called dunnhumbyUSA that is significantly increasing coupon redemption rates.  

krogerIt turns out that Kroger is mining their loyalty card data in a way that is signficantly boosting their savings via higher coupon redemptions.  It turns out that Americans typically redeem only 1 percent to 3 percent of paper coupons, even in the current recession.  But Kroger, In contrast, says as many as half the coupons it sends to its regular customers are getting used.

The difference is that Kroger is augmenting standard purchase information from its shopper cards (lots of companies do that) with dunnhumby’s consumer analysis and customer interview methodologies.  This “blend” allows them to send customers the right coupons for the products they regularly buy. 

If you’re a retailer or manufacturer you may want to keep an eye on dunnhumbyUSA.  In addition to the obvious work the do for parent-partner Kroger, they have added Coca-Cola, The Home Depot, Procter & Gamble, Macy’s an Kraft Foods and others to their growing list of clients.  In addition, their web site indicates that they have been adding new offices in cities around the globe.

It will be paticularly interesting to see if or what direction this joint venture might take couponing in the online space.  Jedwar.com will keep watching.

Filed under 1, eCommerce, Manufacturers, Marketing, Retailing Tagged with , , , , , ,

← Older posts

Follow

Get every new post delivered to your Inbox.