Sales

A Better Mousetrap?

A Better Mousetrap?

The Wall Street Journal recently reported on a couple of entrepreneurs that apparently came up with a better mousetrap--make that pen. For how many hundreds of years have we as human kind been using writing utensils that are straight like a stick? Been a few at least and before that the quill. Then in 1987 Colin Roche, a high school student at the time, gets sent to detention and dreams up a new design for a pen to relieve his writer's cramp (any guesses as to what he was writing 500 times?).

The first prototype was built in his dad's garage (see picture-first prototype on far left) and the company, called PenAgain, did nearly $2 million in sales last year. Now, according to the article, they've been given a shot at the big time--thirty days to prove it will sell in Wal-Mart. If 85% of the 48,000 pens ordered by Wal-Mart and placed in 500 test stores sell during the first thirty days, they are in. If not, they may stay on in some of the trial stores or be completely dropped.

Getting into Wal-Mart is a big deal. They have 138 million customers every week! Competition to get a product into that channel is stiff. According to the chain they see about 10,000 new suppliers every year. Of those only about 2% make it to the trial run stage and that is just the beginning. Suppliers to Wal-Mart have to adhere to strict packaging and shipping requirements, monitor the sales of the product in each store, and drive customers into Wal-Mart to buy the product.

So what is PenAgain planning to do to drive customers into Wal-Mart to buy their pen? Unable to afford print or TV ads they plan to do viral marketing. Over the past several years they have collected an email list of 10,000 customers who regularly buy their pens. Mr. Roche describes them as "people who really want to know what the heck is going on with us."

I hope they succeed. Next time I'm in Wal-Mart I'll look for one of their end caps and drop $3.76 to see how it works both because I'm curious but also because I learned a few things from them:

  1. It is possible to improve everyday things that we take for granted. I'll never look at a pen again the same way. A good paradigm shift.
  2. Though it would be easy to summarize this story by saying, "A kid came up with a new kind of pen while in high school detention and now it is selling in Wal-Mart," the fact is a lot more than just a better mousetrap has gone into their success so far. The article doesn't say how many small retailers they work with, but $2 million in sales is a lot of pens and I'm betting a lot of retailers. That's a lot of selling to get to this point.
  3. It doesn't matter what kind of business you are in, building a database or list of customers that want to know "what the heck is going on" with your business is vitally important. The world may not beat a path to your door if you build a better mousetrap, but your loyal customers will if you have a way to let them know. I checked out PenAgain's website, you can join their mailing list right on their front page.
  4. Public relations efforts do work. PenAgain is doing something right as far as PR goes. I was impressed they were in the Wall Street Journal, then I took a look at their site. They've been in Newsweek, Wired, Entrepreneur, and San Jose Mercury News just to name a few. Whatever they are doing, it works and their odds of selling 48,000 in the next 30 days is going up.
The growth of your business will be determined by what your customers say about it. Do you know what they are saying? Learn more

5 Steps to a Sales-Doubling Buzz Force!

5 Steps to a Sales-Doubling Buzz Force!

Interested in doubling your sales? That is exactly what Proctor & Gamble did with their Dawn Direct Foam dish detergent. How did they do it? With a word-of-mouth marketing program called Vocalpoint. According to a recent article in BusinessWeek, this is how it works:

Procter and Gamble looks for customers that match their target criteria, in this case moms and particularly those with large social networks. They find most of them by advertising online and through referrals. Participants are asked to talk to their friends about new products. In return, P&G promises a stream of new product samples, "a voice that is going to be heard," and specific messages to share. So far 600,000 moms are participating.

According to Steve Knox, the CEO of Vocalpoint, the most difficult challenge with word-of-mouth marketing is making it predictable. His solution: find a strong reason why a person would want to share product information with a friend. The article goes on to say--and this is very important--that the message given to the participants is always different from the one P&G uses in traditional media.

For example on the Dawn campaign, traditional ads stressed the grease-cutting power, But the message sent to the Vocalpoint mom's focused on how fun the foam was for kids to use--so fun they would be asking to help wash the dishes. They also received a sponge shaped like a foot and a dozen $1.50 coupons. The result: sales in the three test markets were double those in markets where Vocalpoint was not used.

Sound expensive and difficult to manage? I don't think it has to be. Here are five simple steps to get your Buzz Force going and your sales increasing:

  1. Make it worth their while. Proctor and Gamble offers two things: product samples/discounts and a sense of empowerment. Both make their participants feel like a VIP or an "insider." That is your goal. Price the coupons such that you will be happy to see your "buzz force" using them and remember the pay-off is not just your participant coming back in with the coupon but the friends they are talking to and the feedback they are giving you.
  2. Invite your customers. The need to invite is obvious, the method can vary. Proctor & Gamble places ads to attract those interested. That can be expensive. Why not just invite your customers as you complete your transaction with them? There are several ways to do it. You can start by asking for feedback and then follow that up with an invitation to stay in touch. Another option is to invite them to join a birthday or some other kind of club and then develop the relationship from there. Finally, is the direct approach. "Interested in joining our fan club? You get discounts and sneak previews you can pass along to your friends."
  3. Give them a message worth telling. Hopefully your business is so remarkable that your customers will be anxious to tell their friends about you, but don't leave it to chance. Remember Proctor and Gamble always gives their buzz agents a specific message that is easy to share with friends. Put yourselves in your customers' shoes--what would be an easy way for them to tell their friends about you? Maybe it is "privileged" information: "Did you hear Subway is coming out with a new sandwich?" Maybe it is a great deal. "Hey, next time you need a hair cut let me know, Sport Clips gives me great coupons." Or maybe it is something just plain remarkable, "I got two movie tickets today from my insurance guy!"
  4. Give them another message worth telling. This shouldn't be a one time campaign. Stay in touch regularly. Those who have "opted-in" want to hear from you. The more ideas you give them to talk to their friends, the more likely one will work for them and you'll start seeing their friends.
  5. Listen and Learn. Perhaps this one should have been first rather than last, because it is very important. Those who join your buzz force can become your best source of market intelligence. They know and like your product, they know how people react to your product, and they are willing to put some effort into your product. Ask them what they think and listen carefully. Look to their feedback for message ideas and ways to improve your offering. How do you think the Proctor and Gamble folks figured out kids like the foam? It didn't happen in a board room.

Still sound like a lot of work? There are tools that can be used to greatly streamline the time and effort required to manage a word-of-mouth marketing program (Caution: shameless plug approaching). PromoterZ is one such tool. In simple terms, it gives users a quick and inexpensive way to invite participants, gather feedback, send messages (including online coupons), and even includes an easy online way for the buzz force to pass the word to their friends. It handles the logistics so that you can focus on the message. Check it out at www.promoterz.com.

The average American consumer discusses brands 56 times a week. Are they discussing yours? Learn more

Fish Jumping in the boat!

Fish Jumping in the boat!
Remarkable Businesses get great Word of Mouth

I came across this amazing video. I don't know the story behind it but it appears two people are in a boat "fishing" at night with a spotlight. What is remarkable is that they don't have any fishing poles. The fish are just exploding out of the water and jumping into the boat!

Sometimes it seems as a business owner that if people just knew about our product/service they would be jumping into the boat to get it. In a way it is true. The trick is getting people to know about it and knowing implies believing too.

I would love to know the story behind this video, how did they discover this spot where the fish are jumping? Did they just come upon it themselves or did they hear it from someone else?

My bet they heard it from someone else. Word of mouth is powerful in its ability to not only share a message but to attach some trust to it as well. The trust part seems to be the key.

Not all word of mouth referrals come from a trusted source, think fish stories! But even the wildest fish story is often as believable as some ad copy!

So, as business owners, are we providing a service/product that is so remarkable that our customers will share the good news?

Customers who feel that you are listening to them are more likely to recommend you to a friend. How do your customers know that you are listening? Learn more

Taking Care of the Golden Goose

Taking Care of the Golden Goose

Came upon an interesting post in the Life Insurance Agent Blog. The title of the entry is The Lie About Leads. Buying and selling leads is big business in the insurance industry. Do a Google search on "Insurance Leads" and you will see what I mean. Just like any other business, finding new customers can be an expensive and time consuming process. Here is a quick primer on lead terminology from the Life Insurance Agent blog:

Cold lead—this is worthless—it’s a name from a mailing list broker. The person may meet certain criteria—e.g., age, income or household value. Above that, it’s just a name, like a name from a phone book.

Warm lead—the person has requested information by completing a card, an Internet form or expressed interest with no coaxing. Your best prospects will always be the ones that take action on their own, with no one convincing, no coaxing, no call from a telemarketer.

Telemarketed lead. This is supposedly a warm lead with interest in meeting—they tell you that the prospect is waiting for your call. I doubt it. Few people have the time and inclination to talk to telemarketers on the phone and sales people.

Set appointment—this can be a very valuable lead but ask how the appointment was made. Did the prospect first call from an ad or direct mail offer and then a telemarketer set an appointment? That’s good because this prospect took the initiative.

I think he makes some great points but may have left off the most important lead of all: a referral from a happy customer. Even the most qualified lead listed above has no clue about you--your honesty, your integrity, your ability to deliver great service. On the other hand, a lead that comes from a happy customer, that lead comes with your customer's reputation attached. That is, your customer likes you enough that they are willing to put their reputation on the line with their friend on behalf of you and your business. Countless surveys have shown that referrals are without a doubt the most powerful influence on just about any purchasing decision.

Does that mean that there is no place for buying leads? No, not at all. Especially when you are getting started. You have to keep your funnel full. What it does mean, is that every lead that you successfully turn into a customer is a golden goose. Your highest priority should be to take care of that goose so that it continues to lay the golden eggs of referrals well into the future.

Think it doesn't work? Tyler Slade of Canyon Lands Insurance, one of our PromoterZ™ customers, gets a 9 or 10 from 95% of his clients when asked how likely it is they would recommend him to a friend. Not surprisingly, he has received referrals from 60% of his clients. It works.

So here is my blatant PromoterZ plug: Apply some modern technology to your client care tools to make sure your geese are being well tended. PromoterZ™ will make sure they are happy, send information to them regularly, send them a birthday greeting, and collect referrals. Check it out: www.promoterz.com. End of blantant plug.

The average American consumer discusses brands 56 times a week. Are they discussing yours? Learn more

Customer as Emperor

Customer as Emperor

From Japan comes the tradition of oshibori. Oshibori is the Japanese word for the rolled up hot towel you receive after eating at an authentic Japanese restaurant or at the conclusion of an international flight. If you have never experienced a hot towel after a long flight, it is as close as you can get to a refreshing shower in the comfort of your seat with all your clothes on. What does it have to do with growing your business? It's remarkable.

As noted, you might expect a hot towel in a Japanese restaurant or on a flight but how about in the dentist chair just after the hygienist has stretched your mouth into unnatural shapes to chisel that last piece of plaque from your teeth? Nice and warm, with the light sent of lemon--that would be remarkable wouldn't it? How might that change what you tell your friends about your trip to the dentist? Simple thing. Only costs a few cents. But it could lead to a number of referrals. What would your customers tell their friends if you gave them a hot towel?

According to Jason Stark of White Towel Services, the majority of his customers are dentists. Dentists that understand that filling your cavity is a commodity--any one of a thousand dentists could it. But having a remarkable experience in their office--that is something that nobody can compete with.

So what do your customers remember about your business? Do they experience something remarkable enough to tell their friends about? For some businesses it might be their concept. For example, Entrees Made Easy provides the ingredients and recipes for several meals to its customers making it easy and quick for them to create great tasting home cooked meals. The concept is new, innovative, and needed in today's hectic world. Those that try it can't wait to tell their friends.

Thankfully, an innovative new concept isn't the only way to be remarkable. The sad fact is that good service is so rare, any company that does provide it is remarkable. I read just yesterday in a column by John DiJulius about Cameron Mitchell Restaurants (27 restaurants in 7 states). What I read wasn't about their food or their concept (though with further research I learned both are amazing). What I read about was their customer service. They seem to realize that indeed the customer is the emperor and the emperor doesn't like to be told "no." Their promise: "The answer's yes..now what's the question?" Given their growth, I think their customers remember that kind of service and find it remarkable enough to tell their friends.

Still wondering what is remarkable about your business? Here is a suggestion: ask your customers. Ask them if they would recommend you to a friend and if so why? Then listen carefully.

How ever you figure it out, do it quickly. Being remarkable is not just a good idea--it is absolutely required for any business to both survive and grow.

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Seeds from the blogworld
We search the business blog world looking for posts that illustrate principles, or "Seeds", that if followed, or "planted", will help small businesses grow. We list them here for your convenience. Enjoy.

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