Small Service Business Marketing Synergy Ideas

Although true success in Small Business Marketing Rests on a combination of Push, Pull and Personal Marketing techniques, there is particular power in those initiatives that combine aspects of all three. Here are some suggestions:

---- Build a Facebook Page (used to be called Fan Pages) for your business and add to it each day.

In particular, add info of your upcoming talks, appearances, or networking events that you would like to invite people to (even if you are not speaking). Promote your page and ask people to “opt in” to receive your feed by clicking on the “like” button. This is a powerful integrated investment. You get the power of push, the reach of pull and if you get more face time with prospects, all the advantages of a personal marketing overture. If you're not sure why this is a great idea, check this link out for LOTS of reasons to do it!

------ Arrange a small wine and cheese event at your place of business or a neutral venue. Make a speech or give a tour. Record it. Share it.

I recently saw a presentation that explained how to get on to YouTube in 10 minutes. It is that simple now with new video tools. If you have a place of business, invite some prospects for a tour. If you run a virtual business, choose a nice meeting room and put together a presentation. Invite them. Make a video of your presentation (either during the talk or afterwards with your webcam). Use YouTube and use a variety of techniques to promote your video as a “pull marketing” element http://www.webtvwire.com/15-ways-to-promote-your-video-online.

------- Do you belong to a local chapter of The Rotary Club, Lions, Elks, Women in Technology, or any other service or professional group? Leverage this membership to enrich existing connections.

When is the next meeting? Is the program of general interest? Do they allow guests? Why not announce the program on Facebook, in your newsletter, or use a program like Evite (http://www.evite.com/) to send out an email to your LinkedIn connections or your Outlook contacts? Arrange to meet your guests at the door and introduce them around. They will appreciate the networking, you will solidify your relationship with them, and after the meeting, write up a little piece for your blog or newsletter and POST it.

If you need some additional ideas, give me a call for an appointment. I offer a free 1 hour of consultation without obligation or charge.

Tom Pencek

Service for Profit, LLC

tom@serviceforprofit.com

650-799-7261

Lumpy Mail – Secret Weapon or Dud?

"Tom, if you’re not using Lumpy Mail, you are missing a great opportunity.”

The speaker was Jim Cecil, founder of the Nurture Marketing institute, and a lecturer at a marketing conference I attended in 1993. Jim had been talking about some amazing results he had obtained using regular mail, with an enclosure large enough to make the envelope “lumpy”. When doing a B2B mailing for a large software company based in Washington State (!!) he achieved a 63% open rate. (In direct mail circles, that is considered REALLY good).

Since that time I have used lumpy mail from time to time, where the value of new relationships was high enough that it made sense to do anything we could to make a connection with a target. As a matter of fact, I am working on two such programs now for a couple of clients. They work because, as one happy customer put it, “With [lumpy] mail pieces I've experienced as much as a quadrupling in response rate over "flat" letters and postcards. There's just nothing like dimensional mail...it's like being a kid again, ripping open your mail to see what the surprise is inside! ”

If it is such a great technique, why isn’t every B2B solicitation “lumpy”? Because the other side of the coin (pun coming!) is cost and lead quality. The cost per lead makes this technique an unprofitable one if the Lifetime Customer Value is not greater than $500, in my opinion. And then there is the cost of the “enclosure”. I got a piece of lumpy mail last week with a pen inside. I opened it, kept the pen, and threw out the mailing piece. You want to avoid buying the lead with an enclosure that is too valuable.

Howard Sewell, of Connect Direct Inc., a highly successful direct mail firm that focuses on high technology businesses, advises his clients to ask these questions before embracing lumpy mail for a lead generation campaign:

• Is my goal maximum response at any price, or is it minimum cost per lead?
• How much is a lead really worth to our company?
• What qualifies a prospect as being a genuine lead, and will this campaign generate those kinds of prospects?

Facebook for Business?

Many People have asked me about the suitability of using Facebook for business development. Recently, The Professional Services Journal posed this question to its readers, and the Journal's editor recently summarized the feedback. Here is her article, reproduced with attribution:

Tom

Face It: Facebook Can Help Businesses

Do it right to make it work

by Meryl K. Evans, Editor, Professional Services Journal

While many businesses see Facebook (FB) as more of a personal social network where people find family and school friends, an equal amount of businesses have set up shop on Facebook to create communities and boost brand loyalty.

Facebook allows you to assign minimal access to people whom you don't know well or know only on a professional level. They won't be able to see your photos and other personal information.

Not all readers agree on whether Facebook should be part of your business marketing strategy. Their advice falls into one of the following three ideas:

• Take advantage of Facebook Pages and Groups.
• Go a-twitterin' instead.
• Look to your customers.

Take advantage of Facebook Pages and Groups

Facebook Pages and Groups can be a great place to serve your customers, share tips, announce upcoming free seminars and so on. When creating a Facebook Page, focus on offering value to your customers and mention your blog, newsletter and other resources. A good social network strategy uses various social networks and refers them to each other since everyone has a preference for one network over another.

Go a-twitterin' instead

For some businesses, Facebook might not be ideal, and they should look to Twitter instead. "Facebook is designed to keep you on the page as long as possible with all those annoying applets and friends poking you. Ignore FB and work a Twitter account into your business. It's best to focus your efforts on one avenue in social media rather than spreading yourself out too much," says Greg Wolkins, Web consultant with Catscape.

Look to your customers

Marketing's first rule comes to play here. What do your customers want? What do they use? "The whole point of social media is that it is social. Determine where your customers and collaborators are and join them. If you discover that your community is on Facebook, then develop a quality presence there. The same for LinkedIn or Twitter. The first question to ask is always, whom do I want to interact with and where will I find them? Once you answer this question, you'll know where you need to be," says Joan Koerber-Walker, chairman of CorePurpose, Inc.

Some business-to-business (B2B) companies have not yet warmed up to the social networking thing, especially with Facebook. CEO and President of Retention Resource Center Terri Schepps says, "If a business is consumer-focused, I can see the value in having a Facebook page. Facebook is not the best platform for B2B businesses. Mixing personal and business can be risky for both."

You can manage your Facebook account to connect with business contacts while minimizing what they can see on the personal side of your FB account. Users connect with others, join networks through Group and FB Pages and reinforce their business brand. In fact, should you decide to try FB for your business, discover 32 ways to use Facebook for Business.

Service Naming: Are We Missing an Opportunity?

At a recent networking event, it had been a long day, and I was ready to go home. But I had paid to attend the event, which offered a chance to mix it up with VCs and small business funders. After slapping on my badge (why don't those things ever stick?), I headed straight for the wine bar, where I saw three bottles: a generic, mundane merlot, a generic white wine and something called Smoking Loon Merlot. WOW! I could almost smell the evening campfire, and hear the woods at sunset. My choice was easy.

Yet as marketers and sellers of professional services, we frequently pass up the chance to make the choice easy for our customers. Instead of enticing them with names of rich emotional significance, fragrant with the emotional impact of the benefits embodied by their services, we default to uninspired names like "Gold" or "Server Integration Service." No wonder our sales teams must work so hard to sell service contracts and service uplifts. Are pedestrian names causing us to miss sales and profit?

And we may not be missing just a tactical advantage; services can have a strategic impact on our core business. In the technology space, for example, support revenue represents the lion's share of the service revenue pie. At margins of 30 percent to 50 percent (or as high as 60 percent for some high-tier support offerings), support revenue contributes a disproportionately high percentage of the overall corporate profit.

Smoking Loon or Gold Medal Merlot?

Just because I'd go for Smoking Loon over mundane Merlot any day, I was delighted to come across some research that seems to support my preference. According to an IT Services Marketing Association (ITSMA) group study of its members, in some geographies, the "take" rates for high-level offerings using the precious metals naming convention (Platinum, Gold, Silver, Bronze) are falling. Of particular interest is the observation that European buyers seem to be willing to settle for the "gold" offering: Sales levels of the highest and most profitable services and support offerings have trailed the U.S. results.

Does this mean that European buyers are less discriminating? Or that they have no emotional connection to the underlying value of the highest level support offering? I vote for the latter.

Moving from tired naming conventions to refreshing ones.

While traditional service naming conventions may be useful in helping customers quickly identify the most robust among a variety of offerings, they provide no emotional connection for the customer and no hint of a value proposition. Companies that persist in using these "tired" conventions may experience reduced sales levels of their top-tier offerings. This can lead to eroding margins, lower profitability contribution to their bottom line, and they may even cause loss of market segments to competitors that wake up and try something new.

The power of an effective service name can help establish a new offering, even usher in a whole new category of services. In the early 1990s, my friend, Justin, had a new voice mail and messaging service he demonstrated for me. Called "Wildfire," customers could summon it by speaking the word while connected with a special number. Once "in session," it allowed him to place calls without looking up numbers (the system used voice recognition software), send faxes or conduct other business. Even more impressive, when people called Justin, instead of just leaving a message, they could tell the system to page him or find him at one of his other numbers.

This was the early offering of a category of productivity tools known as voice-activated virtual assistant technology, and it grew with market enthusiasm of its value to customers. Sure, it was a genuinely useful service, but I believe that it "caught fire" among early adopters at least partially due to having such a great name.

Why isn't everyone drinking from the "naming" Kool-Aid?

So if names pave the path to riches, why aren't more companies being smarter about naming their services? Recently, I called my friend, Athol Foden of the firm Brighter Naming in Mountain View, Calif. The company has a cool site full of fun stuff about product and service naming, including a Naming Critic with examples and critiques of great and not-so-great service and product names.

Foden says, "Part of the issue is that so many small service companies haven't properly registered their names ...

Making sure you aren't inadvertently stepping on someone's unregistered service trademark takes a little time and research money, resources in short supply when you are rushing service products to market. If companies spend money advertising a service name, they need to trademark it to protect their investment in building awareness and branding. So, as with most things, planning pays off.

Coming up with a great name or naming convention can lead to more money in the coffers of your company, and it makes the choices easier for your customers. Of course, the Great Name didn't keep me from spilling Smoking Loon Merlot down the front of my shirt when I took too big a gulp.

"I should have had the white wine," I said to myself, as I made a quick exit.

Getting Started by Asking Questions

When considering what type of services to offer your customers the simplest way to proceed is to start by asking them. What particular difficulty are they experiencing with your product? What is its business impact? But just asking your customers isn't enough - you need to understand the demands that their customers are making, and how your products are being used to meet that demand. You must strive to provide service solutions that your customers need, not necessarily those they say they want.

Many years ago a major car manufacturer began to study the new car sales market. They were attempting to understand why so many people hated to buy a new car. They talked to the dealers (their "customers") and then began to interview their customer's customer (the car buyer). The result was a new program, offered in selected markets, of fixed price car selling combined with full disclosure. No more haggling or negotiating. There was one price, and it was listed. This new service increased car sales in those regions where studies showed that new car buyers were women. Studying your customer and your customer's customer will tell you what service will reduce "customer pain" and increase solution value. Many times, you can get a good idea of value pricing, based on your interviews.

For instance, an installation and configuration service for complicated lab equipment could get newly purchased equipment "producing" quickly, at measurable value to your customer, which will tell you the value of the service, and provide guidance for pricing.

Consider starting your process by having a conversation with your customer. Ask leading questions and explain what you are trying to do. Consider asking permission to talk to a few of their customers. At first, keep your questions general and open-ended. Remember you are tying to surface a new product idea. As an idea begins to take shape, and you have a straw dog to share, consider going back to the same group to get more specific feedback.

5 steps to getting started with Services

1. Talk to your customers.
2. Talk to their customers.
3. Identify the "pain" associated with existing product.
4. Explore possible service "Band-Aids" for that pain.
5. Create a "test" service proposal and share it with your feedback group.

Service - Product Symbiosis - building service into the product

There are lots of ways to look at service by categories, including by their relationship to “products”. Three categories include: 1) services added to existing products (last week’s issue), 2) services designed into products– this week’s topic), and 3) services independent of products. The “recipe” for successful service design, development, pricing, launch and promotion varies with the category of service.

Just as the old safety razors were useless without their disposable blades, services can supply an essential part of a total solution’s value proposition. How do you design a product and service in true symbiosis – with multiple yet interrelated value propositions?

Most of us have heard of TiVo but what about Teleworld Inc.? This Silicon Valley start-up can teach us a lot about how to accomplish this difficult service birth. According to Randy Komisar, in his book, The Monk and the Riddle, Teleworld was the brainchild of Mike Ramsay and Jim Barton: a home video server that would store incoming electronic information and be linked to a variety of output devices in the home such as Internet appliances and computers. But these innovators quickly realized that the key to success lay in the back-end service required to keep “home servers” working. Such services would include things like a smart program guide, customized viewing based on preferences, variety of services based on “learned” customer preferences. The team at this innovative company, renamed TiVo Inc., went on to revolutionize the home TV viewing market.

“We don’t make any of our set top boxes. Our partners, like Philips, do that. Instead, we focus on the services and programming upgrades, “explained Ted Malone, Director of Product and Service Marketing at TiVo. “The service we provide is not just the smart TV listings. It includes all the back-end technology: software updates, activation and authentication, and technical support logs. Eventually we will add things like Video on Demand or premium content.”

Although not the manufacturer, TiVo, depends on successful sale of set top boxes through retail distribution channels. Only when a customer has a box installed can he become a TiVo service customer. Unlike the hardware, the service is sold directly to the end user. That was one of the service marketing lessons that TiVo developed in its early planning. Another was starting off right with customers. “It was important from the start that we NEVER provide free service. We wanted to be certain to have a true business relationship with all of our customers from the start.” Says Malone.

5 Key ideas

1. Design your product with service in mind

2. Never provide the service for free.

3. Test your assumptions

4. If you can, sell your service directly to your end user

5. Avoid subsidizing the design, production or sale of “reusable” products in a product/service solution unless you can guarantee the viability of back-end service revenue.

Keeping a Low Service Profile

Positioning: what are you going to sell, and to whom? If you have decided that service is "context" for your firm, are you going to package services for sale, give them away with your products, or a little of both? Perhaps there is an opportunity to tier your service - provide a particular level of service free with your product, and allow customers who demand it to pay for enhanced service.

That's a decision that Network Appliance Inc. has made. "We've determined that service is not "Core" for us. Since our products are simple and reliable, we bundle as much as we can into the product, at no incremental cost," says Collette Anderson, Services Field Marketing Manager for Network Appliance Inc. "Our goal is to make service a non-issue for our customers - to remove any reason for low satisfaction with our products."

Firms like Network Appliance Inc. (http://www.netapp.com) invest heavily in service cost reduction to reduce the customer's total cost of ownership. "Our Mean time Between Failure is extremely high but when customers do need service, many prefer to contact us through our service and support web site (http://now.netapp.com/public/sitemap/sitemap.shtml)," says Anderson. Web technology allows customization, and puts the customer in control of the service interaction, especially for self-service items like software upgrades or usage questions.

Remote support, and significant "back office" investment in database profiling and monitoring, is perceived as a powerful differentiator by many customers. "Occasionally we call the customer about a problem that they didn't even know about, but our system has diagnosed the trend, and we've already dispatched the part and an onsite installer," says Anderson.

This kind of "tailor made to the customer needs" positioning can also lead to a lot of custom service business. "If our customer asks for some special service or process, we bend over backward to accommodate him," Anderson explained. Sometimes fair pricing for custom services can be complicated and hard to calculate but a willingness to meet a customer's custom needs allows you to keep up with changing customer requirements. "When we find that a significant number of customers have asked for a new feature, we make it a standard service product."

5 Key Ideas

1. Combining services critical to customer satisfaction with your product, and service tiering, offering additional services or higher service levels for those willing to pay, will allow you to keep fixed costs down, but keep your more demanding customers happy.

2. In service "context" situations, don't apologize for the lack of a human touch. Customers appreciate cost minimization, and they like to "drive."

3. If they ask for it, and you can,-- give it to them. Generally, services are a lot easier to customize than manufactured products. Offer them on demand, for a small premium over cost. (You'll also get a built in Market Research benefit!).

4. Don't be afraid to "partner" if your customers need services that aren't in your budget.

5. Partners are also a great way to reduce the cost of providing on-site service.