SWOT Analysis -- A bit of James Bond for Your Business

“I need a four-letter word ending in ‘T,’” I yelled out to my wife in the next room. My daughter in Indiana had gotten me hooked on an i-Phone app called “Words with Friends,” and here I am at 6:30 a.m. squinting at the screen. 

“Try SWOT,” my wife yells, and, feeling particularly stupid, the palm of my hand flies up to hit my head. How could I not have thought of this word that I have used almost every week for the past years and written countless time?  In marketing business, SWOT has a special meaning because it’s an abbreviation for Strengths, Weaknesses, Opportunities and Threats. And for every small business, part of its annual planning process should be a SWOT analysis.

A SWOT analysis is a great way to identify and summarize many of the factors that can influence small business success. Along with goal setting and a marketing plan, it can help inform business owners and managers about their best choices for investment, hiring, promotion, and even new product development. 

I like to capture SWOT findings in a graphic consisting of a large rectangle divided into 4 equal squares. In the upper left goes a list of Strengths—the skills, abilities, and assets of the business. What does the business do particularly well? Are any employees “thought leaders” in their industry or can any employees be expected to make an extraordinary contribution to the business in the months ahead? Anything a customer wants that you provide and your competitor doesn't can constitute a possible strength.  This is the place to list every aspect of the business that makes it a “stand out” enterprise.

To the right of that rectangle goes Weaknesses, a list of problems, temporary or long term, which could impair success of the business in the months ahead. A cash-flow issue? Running out of space? No parking for customers? Lack the latest machine or offering? Rack your brains to think of anything that could hamper your business in the months ahead.  This is the place to list them.

In the bottom left square go those business bright spots that you see for the months ahead: Opportunities. If you provide house-cleaning services, find out how many potential customers are prospects moving into a new subdivision.  If you’re a printer, find out what businesses are changing their names—and consequently in the market for re-branded stationery products. Are your present customers converting to a new platform and will they need migration services? What upcoming opportunities do you see for an uptick in business or profits?

Finally, in the bottom right square--Threats. What stands between you and success? What specific development in the coming months could interfere with your plans for business success? Potential threats include downward price pressure, technology change, or even a specific competitor.  It is possible for opportunities to become threats and vice versa. But advance thought and planning can reduce your exposure to threats and, sometimes, even transform them into strengths.

For example, computer maker Dell has been locked in competition with HP for leadership in the PC market. Here is a SWOT analysis, compiled by a 3^rd party as an exercise, of the factors effecting Dell in the next year.

Once you’ve completed your SWOT analysis, you can use it to give your business an edge. Take all necessary steps to avoid the threats you’ve identified and leverage your strengths to position your business to take advantage of the opportunities you’ve identified.

Don’t Shoot Yourself in the Foot When Using Powerful Marketing Tools

When I opened the envelope, a crisp $10 floated out. Yup, it was real and completely spendable. The letter from one of those survey companies wanted a few minutes of my time and was willing to pay in advance for it.

Business-to-Consumer (B2C) marketing and Business-to-Business (B2B) marketing are different realms. But both are slaves to customer expectations.  To be successful, they need to adapt their customer overtures to what customers expect and will tolerate.  Of course, giving money away is a great way to initiate prospect relationships!

Consequently, I was predisposed to be patient when a few days later the survey company phoned me. When I look back on it, my surprise was how quickly I lost confidence, interest, and patience with this firm and metamorphosed from being a “booster” to being “completely dissatisfied and disinterested in further contact.”

So what happened? I think that the mistakes this firm made in managing our relationship are all too frequent and bear examination. Company X--I won’t embarrass the firm—is a leader in compiling usage data on American consumption patterns of mass media.  Owners of radio, TV, and cable channels depend on accurate data about their audiences in order to set ad rates, confirm programming decisions and directions, and acquire other information to guide their business. This data is provided through a process of statistical sampling, a specialized function provided by a few companies that constantly revise their collection methods.

When Company X called, I was ready and willing to talk with them. Asked if I would be willing to join their panel, I said, “Sure.” “Not so fast,” they said. “First, we have to qualify you to confirm we are talking to who we THINK we’re talking to.” (Ok, they paid me $10 for some time. I will give them the benefit of the doubt).  We then launched into a fifteen minute question-and-answer session with increasingly probing questions.  When it developed that my wife would also need to participate and that she would need to give her approval in person, a follow-up call was requested. When the agreed-upon time came and went, I was unable to successfully call them to finalize things. When they finally called back and attempted to “requalify” me, I lost patience and called a halt to everything.

I’ve thought about this episode and believe it offers important learning for marketers in B2B and B2C roles.

1.  Customers expect consistency in their communications. Paying someone in advance for their time sets an expectation that you have their interests in mind and that you have a keen awareness of the value of their time.  Once you position yourself or your company as having a specific belief or attitude, consistency assumes an even greater importance

2.  Companies often confuse processes designed for their convenience with customer-friendly processes.

3.  Proper segmentation is important to marketers. But needlessly enlarging your prospect pool to make up for prospects who become disaffected before they can become enrolled is also expensive – and can have indirect brand-impairment consequences.

Companies like Company X have outsourced the prospect segmentation process to low-cost call center personnel whose freedom of action is tightly controlled by a script and process designed to minimize errors. “In an effort to screen large numbers of prospects in a cost-effective manner, many call centers utilize low-wage team members with minimal discretionary authority and tight performance metrics, “ says Kerry Elkind, call center trainer and change management expert.  While this might help the bottom line and make the “segmentation process” more predictable and cost-effective, prospects who feel steamrollered by these processes may well opt out before the enrollment or sale can be concluded.

The direct effect of unfriendly processes is a needless enlargement of the prospect pool.  That means more people in the initial mailing, more expensive enclosures, and more prospects to process. But the indirect cost can be significant, too. I have told many people about my negative experience.  Multiplied by many times, that is a lot of negative reputation impact.

According to Elkind,“Call centers are powerful vehicles for transforming prospects into customers and repeat customers.  To achieve this goal, though, call centers must meet (and exceed) customers’ increasing expectations and demands for a level of professionalism that can be implemented only through training and a careful analysis of contact procedures.  This can only be obtained through implementing and maintaining a double-feedback loop which listens carefully to the voice of the customer.”

The moral? If you are going to use powerful marketing techniques to get attention and introduce prospects to your company, service, or offering, be careful. Consistency, customer orientation, and professionalism will pay off and in the long run, it will also be less expensive.

Are You Getting Referrals?

At a business meeting recently, we went around the table telling our colleagues about the “best referral” we had in the last year, the business lead that generated the most revenue. After thinking about it, I realized that for the past twelve months I had not received a single referral that resulted in business! Fortunately, I have been busy, but looking back, I realized that all my business had come to me directly—by meeting and talking with people. I began thinking about why I had failed to reap any benefit from this traditionally important source of professional business leads.

After completing a survey of some recent customers, I identified some interesting answers. The top three reasons for not referring to me were:

1.       “I didn’t feel comfortable about what promises I could make on your behalf. Everything you do is different for each person.”

2.       “I don’t like asking people to do something. I just gave them your card.”

3.       “I just forgot about you!”

If you are wondering why your referral pipeline is not as full or moving as swiftly as you would like, consider whether the feedback I received could also apply to you and your potential referral sources. If any do, you may find that some solutions that I recently implemented may also work for you.

Make Promises

There is a big difference between telling people what you do and telling people what promises they can make on your behalf.  When I introduce myself at networking events, I usually say something like, “I specialize in helping companies increase their revenue by developing, launching and selling services.” I thought that was adequate, but I have been experimenting with a new “promised-based” description: “I work with small businesses for 6 months at a time to increase revenue by as much as 30% by selling new and existing services in smarter ways and for more money.”  People have told me that they feel more comfortable with the second version. What do you think?

I’ve heard other people use “promise-based” descriptions for what they do:

                “I specialize in helping people who can’t pay their mortgages or who owe more than their house is worth.  I will meet with them and offer suggestions without obligation.” My friend, Rick Smith, of ClickHome Reality, San Jose, CA, specializes in helping people sell houses at a difficult time. The way he describes his offering clears up any doubt about what he will do for anyone I may send to him.

                “If you know of a group or organization that would like to tour the Winchester Mystery House and would like to save some money on admission, have them contact me. I can offer them a group discount.” It ‘s hard to be confused about what will happen if I send you to my friend Nathan Emmett at the Winchester Mystery House. If you and 14 friends want a tour, he’ll give you a discount. Simple.

 Don’t Ask for Something; Give Something

Asking someone to do something is hard. Giving a gift is easy!  My friend and client Dan Gonzales, of the San Jose law firm, Ferrari, Ottoboni, Caputo & Wunderling LLP, recently wrote a “special report” that addresses risks of holding commercial property outside of an LLC. When I talk with my clients, I never ask if they would like a recommendation to a good attorney. (Obviously, my asking could seem insulting!) But I do frequently ask if they would like me to have sent to them a copy of Dan’s special report, which is well written and likely to impress them with Dan’s understanding of the law. If they say “yes,” it could indicate that they have a need for legal advice—and not just concerning the topic of the report. Offering this gift is a great easy way for me to generate leads for Dan while offering something of genuine value to my other clients. 

So ask yourself: Is there an informational product you could create that would make it easy for your referral sources to give a gift from you? This is what I came up with. What do you think?

Forgotten? I’ve got an app for that!    

People are busy. Moreover, according to psychologists, we have the ability to hold only about 10 people in our “shelf of mind”—the virtual bookshelf in our minds. As we meet new people in the course of business, other people automatically drop off the shelf unless they remind us of their existence.  If they can link the reminder with an additional benefit, even better.

To do a good job of staying on a customer’s “shelf of mind,” many  firms send them newsletters or greeting cards.  The key to success with both a newsletter and card program is making your content relevant and useful to your clients and potential clients:  it’s never all about you; it’s about them. Because then it gets read and you gain “shelf of mind” as someone attuned to their interests. My CPA is my son-in-law, and the father of 3 of my grandchildren, so whenever I talk to the grandkids or my daughter, I am reminded of Dave’s tax practice.  But even if I didn’t have Dave on speed dial, hearing from him once every 3 weeks or so with an article or a bit of news that might affect me or my business would be a great way for him gently to remind me of his availability. 

To stay in touch with clients and contacts, I have used a newsletter and created a business Facebook page that I post on daily. But I think that may be too passive. I’m going to start calling people about once every 6 weeks or so just to check in with them. 

What are you doing to stay in touch with clients with whom you are not actively working? Please let me know and in a future blog, I’ll share your strategies so all of us can benefit from them.

Making An Email Introduction--or Declining to Do So Graciously

"I’ll send you an introduction via email!”

Sound familiar? How many email introductions have you made in your busy career? If you’re like me, I bet you routinely take sloppy short cuts:

Have you simply copied both parties to the introduction in your email, without first checking with each of them to see if they want to be introduced?

Have you been unclear about WHY you are introducing them (who gains, and why)?

Did you forget to give both parties an “out” if they don’t have the time or interest to meet?

The short cut to which I am most prone is the first one: I am always pressed for time and don’t always call or check with both parties before making an email introduction. According to the Harvard Business Review this is a BIG DEAL. My friend Bob always makes a practice of calling people to make sure they are open to an introduction. Other people send TWO emails, one to the first party, await a response, and only then forward the introduction to the second party. This seems cumbersome, especially if I am doing 5-6 email introductions at a time, which is typical after a BRN or networking meeting.

Recently, I discovered an elegant solution. Called “Introduction Agent,” it is a double opt-in Web-based tool that requires both parties to opt-in to the introduction before the stored introduction is sent. Created by two software developers in their spare time, it offers a pure Web-based method for doing email introductions right. It is free. Try it yourself.

The Introduction Agent forces you to be clear about why you are introducing, gives either party a way to opt out, and makes you look very professional! I talked to Introduction Agent Co-founder Allan Grant about this need to “pre-confirm” email introductions:

“Most Introductions, however well-intentioned, fail. When we started working on Introduction Agent — this was something we believed from analyzing the success rates of our own introductions, but we didn’t have any proof for it. Now that we’ve built the service, we are starting to see some meaningful data to support this. In analyzing the last three months of introductions created using Introduction Agent, we’ve found that only 47% percent of sent introductions are accepted. That means that when someone sends an introduction asking two friends to connect, the introducer is wrong more than half the time.”

So the key point is – either do it virtually (on the web or with separate emails) or in real time with a quick phone call, but it is critical to check first before sending out your virtual introduction to all parties.

But what if you don’t want to make an introduction?

Have you ever been asked to make an introduction that you didn’t want to make? I have. I took the easy way out and made some excuse to the person seeking an introduction that the person to whom he sought an introduction was traveling or in the hospital with a tropical disease. But again, a recent article from Jodi Glickman at HBR offers some great advice for this sticky situation. If you don’t think the introduction is a good idea, don’t make it. But if you decline, how can you do so without incurring hurt feelings? Unfortunately, for this dilemma there is no Web app. But I have some advice:

1. Be honest—more or less. Explain why connecting the requestor with one of your contacts is not a good idea. Offer specific reasons.

2. Offer a consolation prize. Is there something else you COULD do that might be helpful to the requestor?

3. Stay in touch. Leave the door open for a future introduction. Perhaps circumstances will change in the future, and you will feel different about facilitating the desired contact.

Email introductions are a powerful network-building tool. Take a few minutes to examine your past practices, then resolve to be better at helping yourself and your contacts expand their networks.

Sometimes a Crank is Just an Unfamiliar Gear!

Leigh Van Valen died in last October. I read his obit in the NYT. I’d like to be able to say I recognized his name, but it was his picture that caught my eye. He looked like a grown-up version of some of the geeks with whom I went to school, the ones who were brighter than I. The way Dr. Van Valen lived his life has something to say to all of us.

The guy was brilliant: he published over 300 scholarly papers on all sorts of subjects, rarely twice in the same field. Although his early degree was in zoology, he was just as likely to write something publishable about evolutionary biology as about ecology. His immense energy led him to stick his nose into and challenge lots of established dogma. “He could be a fly in the ointment in the sense that his ideas often upset people, and it took time for them to be accepted,” said William B. Provine, a historian of science at Cornell.

One of Van Valen’s most talked-about concepts came to be known as the “Red Queen Hypothesis,” after the character in Lewis Carroll’s Through the Looking Glass. If you remember, the Red Queen noted that "It takes all the running you can do, to keep in the same place." The Red Queen Principle can be stated thus:

For an evolutionary system, continuing development is needed just in order to maintain its fitness relative to the systems it is co-evolving with. (Van Valen, L. (1973). A new evolutionary law Evolutionary Theory, 1, 1-30)

In its time, that concept and the paper associated with it were deemed so controversial that the paper was rejected for publication by 20 established professional journals. As a reaction to his difficulty in finding a publisher for his ground-breaking, contrarian idea, to publish the paper Van Valen founded his own professional journal, Evolutionary Theory. As its editor-in-chief, for years Van Valen spent hours poring over every submitted manuscript, many of them from people whose credentials and publishing history were light to nonexistent. Asked “Why do you spend all that time with submissions from cranks?” he replied, “It can be hard to tell a crank from an unfamiliar gear.”

How well do we separate the cranks from the odd people who have something unexpected to offer or say? Today as part of our strategy to make it through too-busy days, most of us tend to triage our perceptive inputs, censoring what we’re willing to listen to. Consequently, I wonder what “unfamiliar gears” we tune out. Van Valen’s life and willingness to entertain ideas that are decidedly odd should make clear the wisdom of listening to ideas that challenge our own.

Who knows what "crank" will be coming up with the next great idea?

Up, Up and Away with an Innovative Push & Social Media Campaign

I think the lines between traditional Push, and Pull marketing are blurring, and especially as social media becomes more relevant to spreading the word about your service brand. My friend Roger Smith was kind enough to tell me about an interesting one involving the Northern California company Airship Ventures (owners and operators of one of only two blimps in the world), its marketing partner Farmers Insurance, and the online gaming site FarmVille. It’s a great example of how one company is leveraging traditional marketing investment in new ways to reach prospects it never would have through traditional means.

Farmers Insurance Group of companies, the nation's third-largest insurer of both private Personal Lines passenger automobile and homeowners insurance, also provides a wide range of other insurance and financial services products. Farmers operates primarily in 41 states through the efforts of approximately 20,000 exclusive and independent agents. responsible for serving more than 15 million customers. Bottom line – it is a big company, with plenty of resources for traditional marketing campaigns. Yet it has made a significant investment in using Social Media in a new and unique way.

Farmers is leveraging its investment in traditional push marketing via an unusual implementation of a floating bill board and a very new marketing vehicle, the Facebook Business page, to reach hundreds of thousands of new customers with content on its company, its offerings, and its brand promise. Here’s how it works:

Farmers invested a sum of money to advertise for a limited time on the sides of the Eureka, one of the world’s two functioning airships. In making this investment, the company is following the same marketing imperative to promote its brand for 80 years.

“This is the ultimate billboard for Farmers, showcasing our brand for miles,” commented Kevin Kelso, Chief Marketing Officer of Farmers Insurance Group Inc. “Whether it’s flying over sporting events or community-based fundraisers, the Farmers Airship is a larger-than-life reminder of Farmers’ commitment to the communities we serve.”

The Eureka, operated out of Moffet Field by Airship Ventures, has been seen frequently in the last 6 months in the skies above San Franicscos Bay, Los Angeles, and San Diego. It publishes a regular flight schedule, sells seats on its website, and even has charter opportunities available.

So Farmers creates a business page on Facebook and introduces a sweepstakes encouraging visitors to promote Farmers to their friends and enter a drawing for a ride on the blimp. Filling out a sweepstakes entry on the site and clicking on the LIKE button not only provides a lead for a local Farmers agent but also allows Facebook to put Farmers content on your personal Facebook page (they call it your Wall), which triggers a news feed to visitors’ FRIENDS lists. That’s right: if you complete the entry and click LIKE, all of your Facebook friends are notified that you "like" Farmers insurance and have entered the airship sweepstakes.

When I submitted my entry last week, I learned that over 37,000 entries had already been submitted. Seems like a lot, right? But consider that if each person submitting an entry has 10 friends, the contest has already helped the company reach 370,000 people with its product message. But wait, there’s more !

How do you get people to go to the Farmers Facebook page in the first place? Well, you can offer an incentive, you can publicize the incentive using traditional PR techniques, or you can tie in the campaign with ANOTHER online property with LOTS of traffic.

For example, there’s, Farmville from the online social gaming company Zynga. The Farmville game, played online with networks of online friends, is free to users, has a VAST following. Ever played it? If you are looking for reasons to give it a try, check out this posting. Apparently, it simulates lots of the competing forces that affect a typical farm, including bad weather. HOWEVER, if you click on the blimp, and “LIKE” Farmers Insurance, you receive protection from bad weather for a period of time (or could until Oct 27^th, when this feature expired). A great many people felt this was reason enough to provide their contact information to Farmers and share the company’s information with their friends.

The point is that Farmers has made a significant investment in introducing its company and brand to a large and growing demographic (Facebook users, the “farmers” of Farmville) in what seems a powerful validation of the power of social media marketing.

To use social media to promote your brand, you don’t have to rent advertising space on the blimp—though that would certainly be cool! There are less costly vehicles: Do you have a blog? Have you created a Facebook page for your business? Consider adding these “online properties” to your marketing mix because they will enhance your ability to attract new customers.

Get Out of Your Own Way

The other day, I saw The Social Network. Much has been written about the movie and its underlying events. But, as usual, the movie got me thinking about my own less rarefied circumstances.

In the movie, the character played by Jesse Eisenberg pursues a vision of a website for holders of "Harvard.edu" email addresses. Repeatedly, he seems surprised by the ideas others have for expanding on his idea. In my opinion, his vision of success was fairly humble. But It was enough to goad him into action and keep him working.

In the small business space, I see many people with great ideas who could move forward with reasonable success and safety but hesitate because they cannot see the end of the road. They let themselves be stymied because they have no clear idea of what should be their tenth steps—even though they have taken only a first step. I wish I could say to them, “Sometimes you don’t know what turns your business idea will take, so don’t worry about it—just keep moving forward.” People passionate about an idea should pursue it. And they should expect surprises around the bend. That’s what happened to Brian Backus.

Brian is the founder of a hot new start-up called Kidlandia. That’s right – as in "Kid’s Land". As a hobby and a labor of love, he started creating personalized maps of “fantasy lands” named after kids of friends and friends of friends. He had no idea how to scale the idea, and it seemed like a dead end, as a business. But now, with the help of some of his technology-savvy customers, www.kidlandia.com is on the Internet, he has automated the map production, and he is well on his way to founding a successful company. (I just created a map for my grandkids and I had as much fun creating it online, as they will have when they receive it).

One of my friends confessed to me the other day, “I censor myself sometimes. I keep myself from running with an idea, most of the time from fear that it won’t be successful.” Well, we all do that from time to time. But sometimes we learn lots from ideas that don’t work out….wisdom we bring to the next idea.

My thought for the day: don’t over analyze your idea. Unless you are gifted with precognition, you can’t know what will happen. Give your idea a chance to grow. Give yourself a chance to grow into your idea. Get out of your own way. Don’t let your drive to create the “best of the best” business keep you from exploring ideas that remain vague. You just might discover a treasure map.