1.

HOW TO CREATE A MARKETING PLAN

1.1.

How to Create a Marketing Plan

What is a marketing plan and why is it so essential to the success of your business? Find out
here, in the first section of our comprehensive guide to creating a marketing plan.

Firms that are successful in marketing invariably start with a marketing plan. Large
companies have plans with hundreds of pages; small companies can get by with a half-dozen
sheets. Put your marketing plan in a three-ring binder. Refer to it at least quarterly, but
better yet monthly. Leave a tab for putting in monthly reports on sales/manufacturing; this
will allow you to track performance as you follow the plan.
The plan should cover one year. For small companies, this is often the best way to think about
marketing. Things change, people leave, markets evolve, customers come and go. Later on
we suggest creating a section of your plan that addresses the medium-term futuretwo to
four years down the road. But the bulk of your plan should focus on the coming year.
You should allow yourself a couple of months to write the plan, even if it's only a few pages
long. Developing the plan is the "heavy lifting" of marketing. While executing the plan has its
challenges, deciding what to do and how to do it is marketing's greatest challenge. Most
marketing plans kick off with the first of the year or with the opening of your fiscal year if it's
different. Who should see your plan? All the players in the company. Firms typically keep their
marketing plans very, very private for one of two very different reasons: Either they're too
skimpy and management would be embarrassed to have them see the light of day, or they're
solid and packed with information . . . which would make them extremely valuable to the
competition.
While your business plan
and your marketing plan
have a lot in common,
make sure to keep them
separate. Your business
plan should show how you
plan
to
support
the
operation
of
your
marketing. Your marketing
plan should be a concrete
working-out of the ideas
implicit in your business
plan.

You can't do a marketing plan without getting many people

involved. No matter what your size, get feedback from all parts
of your company: finance, manufacturing, personnel, supply
and so onin addition to marketing itself. This is especially
important because it will take all aspects of your company to
make your marketing plan work. Your key people can provide
realistic input on whats achievable and how your goals can be
reached, and they can share any insights they have on any
potential, as-yet-unrealized marketing opportunities, adding
another dimension to your plan. If you're essentially a oneperson management operation, you'll have to wear all your
hats at one timebut at least the meetings will be short!

What's the relationship between your marketing plan and your

business plan or vision statement? Your business plan spells out what your business is about
what you do and don't do, and what your ultimate goals are. It encompasses more than
marketing; it can include discussions of locations, staffing, financing, strategic alliances and
so on. It includes "the vision thing," the resounding words that spell out the glorious purpose
of your company in stirring language. Your business plan is the U.S. Constitution of your
business: If you want to do something that's outside the business plan, you need to either
change your mind or change the plan. Your company's business plan provides the
environment in which your marketing plan must flourish. The two documents must be
consistent.

The Benefits of a Marketing Plan

2
A marketing plan, on the other hand, is plump with meaning. It provides you with several
major benefits. Let's review them.
Rallying point: Your marketing plan gives your troops something to rally behind. You want
them to feel confident that the captain of the vessel has the charts in order, knows how to run
the ship, and has a port of destination in mind. Companies often undervalue the impact of a
"marketing plan" on their own people, who want to feel part of a team engaged in an exciting
and complicated joint endeavor. If you want your employees to feel committed to your
company, it's important to share with them your vision of where the company is headed in the
years to come. People don't always understand financial projections, but they can get excited
about a well-written and well-thought-out marketing plan. You should consider releasing your
marketing planperhaps in an abridged versioncompanywide. Do it with some fanfare and
generate some excitement for the adventures to come. Your workers will appreciate being
involved.
Chart to success: We all know that plans are imperfect things. How can you possibly
know what's going to happen 12 months or five years from now? Isn't putting together a
marketing plan an exercise in futility . . . a waste of time better spent meeting with customers
or fine-tuning production? Yes, possibly but only in the narrowest sense. If you don't plan,
you're doomed, and an inaccurate plan is far better than no plan at all. To stay with our sea
captain analogy, it's better to be 5 or even 10 degrees off your destination port than to have
no destination in mind at all. The point of sailing, after all, is to get somewhere, and without a
marketing plan, you'll wander the seas aimlessly, sometimes finding dry land but more often
than not floundering in a vast ocean. Sea captains without a chart are rarely remembered for
discovering anything but the ocean floor.
Company operational instructions: Your child's first bike and your new VCR came with a
set of instructions, and your company is far more complicated to put together and run than
either of them. Your marketing plan is a step-by-step guide for your company's success. It's
more important than a vision statement. To put together a genuine marketing plan, you have
to assess your company from top to bottom and make sure all the pieces are working together
in the best way. What do you want to do with this enterprise you call the company in the
coming year? Consider it a to-do list on a grand scale. It assigns specific tasks for the year.
Captured thinking: You don't allow your financial people to keep their numbers in their
heads. Financial reports are the lifeblood of the numbers side of any business, no matter what
size. It should be no different with marketing. Your written document lays out your game plan.
If people leave, if new people arrive, if memories falter, if events bring pressure to alter the
givens, the information in the written marketing plan stays intact to remind you of what you'd
agreed on.
Top-level reflection: In the daily hurly-burly of competitive business, it's hard to turn
your attention to the big picture, especially those parts that aren't directly related to the daily
operations. You need to take time periodically to really think about your businesswhether it's
providing you and your employees with what you want, whether there aren't some innovative
wrinkles you can add, whether you're getting all you can out of your products, your sales staff
and your markets. Writing your marketing plan is the best time to do this high-level thinking.
Some companies send their top marketing people away to a retreat. Others go to the home of
a principal. Some do marketing plan development at a local motel, away from phones and fax
machines, so they can devote themselves solely to thinking hard and drawing the most
accurate sketches they can of the immediate future of the business.
Ideally, after writing marketing plans for a few years, you can sit back and review a series of
them, year after year, and check the progress of your company. Of course, sometimes this is
hard to make time for (there is that annoying real world to deal with), but it can provide an
unparalleled objective view of what you've been doing with your business life over a number of
years.

3
Researching Your Market
Whether you're just starting out or if you've been in business for years, it's always a
good idea to stay up-to-date with your market information. We'll tell you the best
methods for finding your data.

The purpose of market research is to provide relevant data that will help solve marketing
problems a business will encounter. This is absolutely necessary in the start-up phase.
Conducting thorough market surveys is the foundation of any successful business. In fact,
strategies such as market segmentation (identifying specific segments within a market) and
product differentiation (creating an identity for your product or service that separates it
from your competitors') would be impossible to develop without market research.
Whether you're conducting market research using the historical, experimental,
observational or survey method, you'll be gathering two types of data. The first will be
"primary" information that you will compile yourself or hire someone to gather. Most
information, however, will be "secondary," or already compiled and organized for you.
Reports and studies done by government agencies, trade associations, or other businesses
within your industry are examples of the latter. Search for them, and take advantage of
them.
Primary Research
When conducting primary research using your own resources, there are basically two types
of information that can be gathered: exploratory and specific. Exploratory research is openended in nature; helps you define a specific problem; and usually involves detailed,
unstructured interviews in which lengthy answers are solicited from a small group of
respondents. Specific research is broader in scope and is used to solve a problem that
exploratory research has identified. Interviews are structured and formal in approach. Of
the two, specific research is more expensive.
When conducting primary research using your own resources, you must first decide how
you will question your target group of individuals. There are basically three avenues you can
take: direct mail, telemarketing or personal interviews.
Direct Mail
If you choose a direct-mail questionnaire, be sure to do the following in order to increase
your response rate:

Make sure your questions are short and to the point.

Make sure questionnaires are addressed to specific individuals and they're of interest
to the respondent.
Limit the questionnaire's length to two pages.
Enclose a professionally prepared cover letter that adequately explains what you
need.
Send a reminder about two weeks after the initial mailing. Include a postage-paid
self-addressed envelope.

Unfortunately, even if you employ the above tactics, response to direct mail is always low,
and is sometimes less than five percent.
Phone Surveys
Phone surveys are generally the most cost-effective, considering overall response rates;
they cost about one-third as much as personal interviews, which have, on average, a

4
response rate which is only 10 percent. Following are some phone survey guidelines:

At the beginning of the conversation, your interviewer should confirm the name of
the respondent if calling a home, or give the appropriate name to the switchboard
operator if calling a business.
Pauses should be avoided, as respondent interest can quickly drop.
Make sure that a follow-up call is possible if additional information is required.
Make sure that interviewers don't divulge details about the poll until the respondent
is is
reached.
Secondary data
outside information assembled by government agencies, industry and trade
associations, labor unions, media sources, chambers of commerce, etc., and found in the form
of pamphlets,
newsletters,
and other
magazines, but
newspapers,
and so big
on.advantage.
It's termedSome
As mentioned
phone trade
interviews
are cost-effective
speed is another
secondary
data
because
the
information
has
been
gathered
by
another,
or
secondary,
source.
of the more experienced interviewers can get through up to 10 interviewers
an hour
The benefits
of
this
are
obvioustime
and
money
are
saved
because
you
dont
have
(however, speed for speed's sake is not the goal of any of these surveys), but five to to
six per
develophour
survey
methods
or doPhone
the interviewing.
is more
typical.
interviews also allow you to cover a wide geographical range
relatively inexpensively. Phone costs can be reduced by taking advantage of cheaper rates
during
certain
hours.
Secondary
sources
are
divided into three main categories:
Interviews
1. Personal
Public. Public
sources are the most economical, as they're usually free, and can offer
There
are
two
main types These
of personal
interviews:
a lot of good information.
sources
are most typically governmental departments,
business departments of public libraries, etc.
2. Commercial.
Commercial
are equally
usually
involvecan
costs
1. The group
survey.sources
Used mostly
by bigvaluable,
business,but
group
interviews
be such
useful as
as subscription
and association
fees.inHowever,
you spend farand
lessnew
than
you would
brainstorming
tools resulting
product modifications
product
ideas.if They
you hired
research
team to
collect
the
data firsthand.
Commercial
sourcesamong
typically
alsoa give
you insight
into
buying
preferences
and purchasing
decisions
certain
consist populations.
of research and trade assocations, organizations like SCORE (Society Corps of
Retired
Executives)
and Dun One-on-one
& Bradstreet,
banks and
other
institutions,
2. The
depth interview.
interviews
where
the financial
interviewer
is guided by a
publiclysmall
traded
corporations,
etc.common sense. Depth interviews are either focused or nonchecklist
and basic
3. Educational.
Educational
institutions
are encourage
frequently respondents
overlooked as
information
directive.
Non-directive
interviews
toviable
address
certain topics
sources,
yet minimal
there is more
researchThe
conducted
in colleges,
universities,
with
questioning.
respondent,
in essence,
leadsand
thepolytechnic
interview. The
institutes
than virtually
any
of the
business
community.
focused
interview,
onsector
the other
hand,
is based
on a pre-set checklist. The choice and
timing of questions, however, is left to the interviewer, depending on how the
interview
goes. is the business section of public libraries. The services provided
One of the best
public sources
vary from city to city, but usually include a wide range of government and market statistics, a
large collection
of directories
information
domestic
and foreign
businesses,
as
When considering
whichincluding
type of survey
to use,on
keep
the following
cost factors
in mind:
well as a wide selection of magazines, newspapers and newsletters.
Mail. Most of the costs here concern the printing of questionnaires, envelopes,
Almost every postage,
county government
publishes
population
and
distribution
figures
in
the cover letter,
time taken
in thedensity
analysis
and
presentation,
the cost
of
accessible census
tracts.
These
tracts
will
show
you
the
number
of
people
living
in
specific
researcher time, and any incentives used.
areas, such asTelephone.
precincts, water
or evenhere
10-block
Other
public
sources
Thedistricts
main costs
are neighborhoods.
the interviewer's
fee,
phone
charges,
include city chambers
of
commerce
or
business
development
departments,
which
encourage
preparation of the questionnaire, cost of researcher time, and the analysis and
new businesses
in their communities.
They
will questioning.
supply you (usually for free) with information
presentation
of the results
of the
on population
trends,
community
income
characteristics,
payrolls,
development,
andcards
Personal interviews. Costs include the printing
of industrial
questionnaires
and prompt
so on.
if needed, the incentives used, the interviewer's fee and expenses, cost of researcher
time, and analysis and presentation.
Among the best commercial sources of information are research and trade associations.
Information
by trade associations
is usually
confined
to a certain
industry
and
gathered
Group discussions.
Your main costs
here are
the interviewer's
fees
and expenses
in
available only recruiting
to association
members,
with
a
membership
fee
frequently
required.
However,
and assembling the groups, renting the conference room or other facility,
the research gathered
by time,
the larger
associationsused,
is usually
thorough,
accurate andand
worth
researcher
any incentives
analysis
and presentation,
thethe
cost of
cost of membership.
recording media such as tapes, if any are used.
Research associations are often independent but are sometimes affiliated with trade
associations.Research
They often limit their activities to conducting and applying research in industrial
Secondary
development, but some have become full-service information sources with a wide range of
supplementary publications such as directories.
Educational institutions are very good sources of research. Research there ranges from
faculty-based projects often published under professors' bylines to student projects, theses
and assignments. Copies of student research projects may be available for free with faculty
permission. Consulting services are available either for free or at a cost negotiated with the
4 way to generate research at little or no
appropriate faculty members. This can be an excellent
cost, using students who welcome the professional experience either as interns or for special
credit. Contact the university administration departments and marketing/management studies
departments for further information. University libraries are additional sources of research.

5
The Ingredients of a Marketing Plan
Ready to get it all down on paper, but not sure where to put it? We'll help you with
the format and elements of your marketing plan.

Every how-to book on the market has a different take on the essential elements of a marketing plan.
Those geared toward the big corporate crowd communicate in a language few human beings understand.
However, the words you use are much less important than how seriously you approach the task.
This section outlines the key elements you need to include in your marketing plan. No matter how it's
ultimately organized, your marketing plan should be a straightforward, easily understood company
document. It should provide you with a clear direction for your marketing efforts for the coming year, and
it should give an incisive look into your company for all readers.
Preparing to Write
Before you begin to write, pull together some information you'll need. Getting the information first avoids
interruptions in the thinking and writing process. Have on hand:

Your company's latest financial reports (profit and loss, operating budgets and so on) and latest
sales figures by product and region for the current and the past three years or, if less, for however
long you've been in business.
A listing of each product or service in the current line, along with target markets
An organization table (If you can count your employees on one hand, you can probably omit this.)
Your understanding of your marketplace: your competitors, geographical boundaries, types of
customers you sell to, existing distribution channels, latest and most useful demographic data, any
information on trends in your markets (both demographic and product-related)
Ask each of your salespeople and/or customer-relations people to list the most crucial points, in
their opinion, that need to be included in the coming year's marketing plan. You don't have to
include all of them, but you do have to take them into account.

Market Situation
The "market situation" section should contain your best and most clear-headed description of the current
state of the marketplace (this is no place for hunches).

What are your products/services or product/service lines?

What is the dollar size of your markets?
What is your sales and distribution setup?
What geographic area do you sell to?
Describe your audience in terms of population, demographics, income levels and so on.
What competitors exist in this marketplace?
Historically, how well have your products sold?

Your market situation section might read like this:

Sumners and Associates is a bookkeeping and accounting firm started in 1981. We provide tax services to
individuals and to businesses under $500,000 in annual sales. We provide bookkeeping and payroll
support to those same businesses. Our market area is Boulder, Colorado, and its northern suburbs.
For the personal market, our clients typically are in the $75,000 and higher income range, or they are
retired with assets of $200,000 or more. For the business market, most of our work is for restaurants,
service stations, independent convenience stores and a large courier service.
With the exception of a slump from 1988 through 1991, Sumners and Associates has grown steadily from
its inception. Gross sales in 1997 were $145,000.
5

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Competition for our immediate market is a group of eight firms roughly comparable to our company. Only
one of these firms, Acme Bookkeeping, has an interest in marketing itself. We believe we rank second in
the group of competitors, behind Acme.
We have a strong position in the restaurant portion of our business.
Much of this information exists in the heads of the management team, the way it is at many companies.
But now is when you write it down. For example, how much information do you have in your officeright
nowon your competition? A marketing plan gives you a chance to pull all this relevant information
together in one place, to spur ideas and justify actions.
Consider each of your products or services up against the matching products or services of your
competitors. How well do you stack up? Is there any significant market opportunity for you that neither
you nor your competitors are currently exploiting?
You'll also find that the best thinkers in your company may well have different ideas about elements of the
current situation. Your marketing plan will provide a good arena to test different snapshots of the market
against each other.
Threats and Opportunities
This section is an extension of the "market situation" section, and it should focus on the bad and good
implications of the current market:

What trends in the marketplace are against you?

Are there competitive trends that are ominous?
Are your current products poised to succeed in the market as it now exists?
What trends in the marketplace favor you?
Are there competitive trends working to your benefit?
Are the demographics of your market in your favor? Against you?

There are lots of places to go to get information on the trends in your market. City and state business
publications frequently publish overview issues; you can talk to local business reporters; and local
chambers of commerce publish projections, as do associations of manufacturers (the names are different
in various parts of the country). Talk to your professional association and read your trade journals.
Here's an example of what a threats and opportunities section would look like for the Sumners and
Associates firm:
Threats:
The company faces four identifiable threats in the coming year:
1. Our computer system needs upgrading to the latest version of our accounting and tax software. To do
this with all of our machines will be too costly. We'll need to work with the existing version of our software
for another 10 months. This may put us at a service disadvantage with some clients.
2. Two of our clients, Porkie's Carryout and the Magnus Group, are facing difficult business prospects in
the short term. We will likely need to replace this business before the end of the year.
3. Acme Bookkeeping, our major competitor, has hired one of our staff members. We have to assume
they now have our current client list and will make solicitations based on their greater size and service
capabilities.
4. Growth on the south side of town is outstripping growth on the north side. We'll need to consider
opening a south-side office or look into ways to use couriers or electronic communications to make
ourselves fully competitive in providing our services.
Opportunities:
1. Morrissey's Inc., a long-time client, has purchased three significant restaurants in the adjoining county
and has expressed an interest in having us take over the accounting work for these operations. This
should provide us a great chance to hire one and perhaps two additional people.
2. Changes in the tax laws have made many small businesses uneasy with handling the bookkeeping by
6

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themselves or through a one-person bookkeeping service. As the details of these revisions become more
public, we anticipate increasing calls for help.
3. We have been asked to participate in several educational venues in the coming year, which include
three presentations at a small-business forum, an evening class at the university on starting a small
business, and a role in the Boulder Entrepreneur Club. These will provide us good exposure and strong
business prospects.
4. The local economy continues to be strong, and we believe our typical clients will continue to flourish in
this growth cycle.
Marketing Objectives
In the "marketing objectives" section, you paint your picture of the future: What marketing objectives do
you want to achieve over the course of the plan? Each of your marketing objectives should include both a
narrative description of what you intend to accomplish along with numbers to give you something
concrete to aim for. Just to say you want to make a first entry into the Swiss screw machine marketplace
isnt providing much guidance. Saying you want to go from 0 percent to 8 percent of the local market in
two years is easier to understandand verifiable. If you're not sure of the size of the local market, then
aim at a dollar figure in sales. Your accountant will let you know whether you've succeeded or not.
Goal for It
If you're new to the marketing plan racket, how do you set a quantifiable goal? Start with your past.
Review your past sales numbers, your growth over the years in different markets, the size of typical new
customers, and how new product introductions have fared. If over the last five years you've grown a
cumulative 80 percent in gross revenues, projecting a 20 percent to 25 percent increase in the next year
is reasonable; 45 percent is not. Make a low but reasonable projection for what youll be able to
accomplish with marketing support toward your new marketing objectives. Set modest goals to start, until
you get a feel for the terrain.
You should make it a point to limit the number of marketing objectives you take on in a given year. Let's
face it, change can bring stress, disorient staff and sometimes even confuse your target market. Keep
your objectives challenging but achievable. Better to motivate yourself with ambitious but worthy targets
than to depress yourself by failing at too many enthusiastic goals.
Here are some typical marketing objective categories:

Introduce new products

Extend or regain market for existing product
Enter new territories for the company
Boost sales in a particular product, market or price range. Where will this business come from? Be
specific.
Cross-sell (or bundle) one product with another
Enter into long-term contracts with desirable clients
Raise prices without cutting into sales figures
Refine a product
Enhance manufacturing/product delivery

This third section of your plan should include perhaps a half dozen such objectives, spelled out with
specific goals. Some examples:

Objective: Introduce our accounting and audit services to Blankville. By the end of the first year,
we want to have six clients of significance and billed time of $75,000.
Objective: Reverse the decline in our package Caribbean winter tour sales in Chicago, Detroit and
Minneapolis. Sales over the past three years have declined 11 percent. We intend to increase sales
4 percent this year and 8 percent next year.
Objective: Introduce lunch fax business at the west side restaurant and deliver 420 lunches per
week by June 1.
Objective: Demo updated X-ray crystallography at selected trade exhibitions in the summer of
1999. Capture 250 leads per show and secure 75 on-site demos.
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To repeat, make your objectives simple, concrete, countable, ambitious and achievable.
Marketing Goals: Where the Details Start
Here's where you come down out of the clouds and spell out how you're going to make things happen.
While your spreadsheet has shown increasingly stunning profits each time you bump up the market gains,
now you're in the real world. Gains must be earned by marketing brains and brawn.
Each marketing objective should have several goals (subsets of objectives) and tactics for achieving those
goals. In the objectives section of your marketing plan, you focus on the "what" and the "why" of the
marketing tasks for the year ahead. In the implementation section, you focus on the practical, sweat-andcalluses areas of who, where, when and how. This is life in the marketing trenches.
When Eisenhower and the Allies decided to invade Normandy in 1944 to open up a mainland Europe
offensive against the Axis powers, they developed detailed plans for victory. While successfully landing in
Normandy and holding it were the overall objectives, many intermediate goals were set to make this
possible: lining up the needed boats, air cover, behind-the-lines paratrooper drops to cut off
communications, feints at a Calais landing to fool the enemy and so on. And, of course, each of those
steps had its own list of details.
The key task is to take each objective and lay out the steps you intend to take to reach it. As an example,
let's take the first marketing objective mentioned
Objective: Introduce our accounting and audit services to Blankville. By the end of the first year, we
want to have six clients of significance and billed time of $75,000.
How can you make this happen?
Let's suppose you've assigned this objective to a group of people, and they've worked up some plans on
moving into Blankville. Here are what some of their goals might look like:
1. Since accounting and auditing services don't work well at a remote site (except for the very largest
companies), we'll probably need a local office in Blankville. We should open this new office by July 2001.
(Always include target dates when possible.)
2. If we're going to talk about our expertise, we need some of our professional staff there. We'll probably
want to detail two or three of our experienced people in that new office, as well as hire local support staff.
3. We may want to do some direct-mail advertising to companies in Blankville. Our message might talk
about special expertise in certain areas of business. We'll target those types of businesses in Blankville.
4. We'll talk to the business editor of the local paper and let him or her know we're coming to town. We
might contribute a "tax tips" article or two for the exposure.
5. We'll approach several business associations in town and offer to give a talk on some specialized topic
in which we can offer some expertise.
6. We'll ask our clients in other cities if they'd be willing to give us some referrals in Blankville.
7. We may run some modest advertising in the Blankville Bugle (a fine and respected newspaper)
announcing our arrival and explaining our special expertise.
8. We'll have an open house and invite a number of local business celebrities, political people, potential
clients and media.
9. We might look to get our Blankville office involved in some high-profile charity or public service work.
You get the idea. If your objective is to build a business in Blankville, you have to put together concrete
goals to make it happen. Each of these actions makes sense. You might come up with others (there's no
limit to human creativity, after allespecially in marketing). The point is that each goal should consist of
concrete actions.
Each of these goals needs to have its own series of steps formalized. Who's going to check on the
advertising rates for the Blankville Bugle? And when should those ads run? Which professionals are
moving to Blankville and how do they feel about it? How do we get a list of companies in Blankville? Lots
of work to do.
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One of the best ways to handle such details is through an activity matrix. A matrix is a grid table that lets
you plot actions across time. When you're developing a marketing plan, you'll soon reach the point where
you have to turn to your calendar and see when things should happen. A matrix provides you with a clear
and very usable framework for such timeline plotting.
You can make the matrix as detailed or as big picture as you want. It should, however, include everything
that's scheduled, when it's scheduled and who the responsible party is. Don't forget to delegate
responsibility as you go.
One of the best things about working with a matrix is its adaptability. Each block on the matrix above
lends itself to another chart, providing more detail. For example, in March 2001, Marge Turner (MT) will
train staff at the home office. Marge, dutiful planner that she is, constructs her own matrix to help her
stay on track. However, her itemized matrix wouldn't appear in the marketing plan. That level of
operational detail would gum up the "big picture" overview the marketing plan is meant to provide.
Budgets
Whether done well or poorly, business activity always costs money. Your marketing plan needs to have a
section in which you allocate budgets for each activity planned. This information shouldn't appear on the
activity matrix since there's enough detail there already. But it should be in writing with the individual
carrying overall program responsibility. People responsible for portions of the marketing activity should
know exactly what funds are available to them. In fact, you would be wise to involve them in planning
those budgets.
Be as objective as you can about those costs you can anticipate. For things with which you have no
budget experience, add 25 percent to your best estimate. Your budget should allocate separate
accounting for internal hours (staff time) and external costs (out-of-pocket expenses). Make sure to enter
the budget on a Lotus or Excel spreadsheet so you can manipulate it during construction to see which
variant works best.
Your budget section might look like this:
Gross sales

$142,000

Budget for annual marketing efforts

$7,045

Yellow Pages

$2,600

Sales letter mailing to prospects

$625

Clerical help on mailing list

$125

Advertising in local business magazine

$500

Advertising in newspaper business section

$1,200

Brochure design and copywriting

$380

Brochure printing

$315

Registration for business exhibitions

$145

Attend training session in Chicago

$930

Purchase new mailing label software

$225

Controls: Tracking Effectiveness

To track progress on your marketing plan throughout the year, establish a regular schedule of meetings,
and spell this out in writing. How will you make adjustments to your plan midstream? How will you
monitor progress in sales/costs to make changes during the year? You can't leave yourself without this
capability.
The reason you pick measurable marketing objectives is to have the ability to track your progress toward
reaching them. Too many marketing efforts aren't quantifiable, with the result that the achievements of
your marketing campaigns aren't satisfactory, or they're just plain illusory.

10
All your marketing efforts will benefit from the classic feedback loop: Act, observe, adjust, act again.
Scheduling quarterly meetings is best. At these meetings, responsible individuals should report on what
they've accomplished in the last quarter, including how much of the budget has been spent. Reports
should be verbal, with a printed summary for the record.
As your activities move forward over time, you'll doubtless find the need to adjust the timing, the budget
or the tasks themselves. At these points you must decide whether to intensify your efforts, add more
tactical steps to pick up the pace, or scale back your objectives. Make your changes in an organized
manner, adjusting all the dependent tasks so that the plan shifts as a whole. Whatever your decision,
make sure to update your marketing plan document. Put in writing your understanding of why you didn't
reach your goals. Keep the original, and date and number all changes. Your plan must be dynamic, but it
shouldn't lose its sense of history. All this information will be extremely useful when you create next year's
marketing plan.
Marketing isn't a science, but it is a skill in which you can make steady incremental improvement.
Your effectiveness section might look like this:
A) Annual gross sales from the previous year

$865,000

B) Marketing expenditures planned during the

$40,000
current year
C) Anticipated impact of marketing expenditures
$110,000
on gross sales
D) Actual marketing
current year

expenses

during

the

$32,500

E) Annual gross sales at the end of the current

$971,000
year
F) Percentage of the actual difference between
this year's sales and last year's sales that can 60%
be fairly attributed to the marketing effort
Executive Summary
Put a brief summary at the front of your marketing plan binder. On a single page, sum up (with key
financial numbers) in no more than a single page the contents of your marketing plan. Use bullet points,
short sentences and bold type for major points, and stay focused on the big issues. What does someone
have to know about your plan to have any sense of it?
This summary gives plan readers a concise description of what your company plans to do in the coming
year. It also forces you to boil your thoughts down to their rich and flavorful essence, which is always a
good thing.
Here's a sample marketing plan summary:
The year 2000 marketing plan for Sumners and Associates has four main elements:
1. We review our existing competitive marketing situation. Overall, prospects look good for our company.
Boulder is growing at a steady 4.2 percent rate, with new businesses starting at roughly 750 a year. No
competitive bookkeeping and accounting firm has made significant marketing efforts, although Acme
Bookkeeping did run a series of advertisements in the business section of the Boulder Bugle. Our gross
sales were $145,000. We'll have to upgrade our software sometime this year, and this will cost us about
$20,000, with associated hardware costs. Our supplier will let us spread these costs over three years.
2. We plan on marketing ourselves aggressively in the coming year. In addition to speaking and training
engagements, we will prepare a series of three half-page ads to run on a six-time schedule in late
summer and early fall in the Boulder Business Bulletin. We'll also produce our first company brochure,
which we'll use as a handout at the training venues. Costs for production of the ads, the brochure and
placement of the ads will be $8,500.
3. We foresee the following results for the coming year:
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Gross sales $ 154,000
Net profit $ 12,400
4. In the long term, we'll explore the possibilities of opening a second office in the city. Over the next two
to four years, we anticipate maintaining our historical growth of 5 percent to 7 percent per year. Toward
the end of that period, we'll hire at least one other employee and consider expanding our leased space.
Your plan must address two different time frames: the short-term (one to 12 months) and the long-term
(over 12 months). Most of your document should focus on the coming year, which is the most important
for the majority of small and medium-size businesses. Marketing typically demands the performance of a
number of short-term actions planned in unison, which together bring about change. Once you've outlined
the major year-end goals, the analysis will largely focus on the mechanics of media, mailing and
promotion. But you shouldn't stop your serious thinking at year-end. Stretch beyond your business's
immediate needs and envision the next two or three years. What are you ultimately reaching for?
Write this down, briefly and in general terms. Questions you might answer could include: How many
employees do you envision adding over the next few years? Will your need for office space stay the same?
Will there be major equipment purchases? Will you be able to hire a manager? Do there exist specific
training courses or certifications you'd like to put your staff through? Will your profit margin stay constant,
or do you think you'll be able to better it? Will you become active in local, regional or national trade
groups? How will market demographics affect your business in the coming years? Keep track of how your
larger vision changes over time as well.

1.2.

23 Hours to a Great Marketing Plan

Unlike Rome, your business's marketing plan can be built in a day. Here's how.

Beth Talbert was a highly respected interior designer. After reading an article about
successful homebased businesses, he decided to quit his 9-to-5 job and launch his own
corporate-office design consulting company. He turned a spare bedroom into an office,
ordered a batch of business cards and called a few colleagues to let them know about his
new venture.
Then Talbert patiently waited for the phone to ring. Six months later, he had only one
client, and his business was failing miserably.
While some entrepreneurs brag about achieving success without much planning, stories like
Talbert's are much more common among businesses that don't have an ongoing marketing
program. Just as a winning football team always goes onto the field with a solid game plan,
your business must have an outline of how to reach out to prospective customers in order
to succeed.
If the word "plan" makes you break into a cold sweat, fear not. It's possible to create a
simple, effective marketing plan in less than 24 hours. By following a series of steps, you
can schedule your marketing activities as part of your daily routine and reach your
expansion goals much sooner.
HOUR 1: Taking Stock
Before you map out where you want your marketing plan to take you, you need to find out
where you are now. How have you positioned your business in the market? Is this how
your customers see you? You may want to ask some of them for feedback. Being as
objective as possible, write four or five paragraphs that summarize your business, including
its philosophy, strengths and weaknesses. Don't worry if it's not neatly organized -- it's
more important just to get everything down on paper.
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HOURS 2-3: Setting the Goal
Who are your target audiences? If you say "everyone," you need to rethink your answer.
Even the largest companies don't market blindly to every individual. They break their
audiences down into distinct profiles, or niche markets, and create messages and
vehicles designed to reach each segment.
Define your niche markets as clearly and specifically as possible. If you're reaching out
to businesses, describe which type, including the industry, revenue level, location and
other important characteristics. If consumers are your audience, describe their age, sex,
income level, marital status and other relevant facts. If you identify several market
segments, rank them in order of priority.
HOURS 4-9: Researching Your Plan
Now that you've outlined where you are and where you want to go, it's time to determine
the best way to get there.
Nothing will get you where you want to go faster than research. Information about your
target audiences is available from a variety of resources, many of them free.
Take some time to find out about the demographics (physical characteristics) and
psychographics (psychological characteristics) of your target markets. Demographics
outline such factors as age, geographic location and income level.
Trade associations and publications are often great places to start your research, especially
if you're reaching out to businesses. Use your own and your target industries' trade
resources for market information. Many associations have Web sites, and many
publications are also available on the Net.
Once you've gathered this information, write a detailed profile of your audience segments.
Include all the demographic and psychographic information you've gathered. For instance,
if you're selling a product to homeowners in Anytown, USA, find out what percentage of
people own homes in Anytown. What is the average household income? Do most
homeowners have children? The more specific your profiles are, the better.
HOURS 9-18: Planning the Action

This is the heart of your game plan. For each goal you've outlined, create a strategy,
complete with your key messages and steps that will help you accomplish the goal. The
good news: You have many tools at your disposal.
As you examine each of your goals, conduct a minibrainstorming session. Consider the
best vehicles for your message. You may decide to use newspaper, radio, TV, magazine
or outdoor advertising; direct marketing programs, including postcards, sales letters,
fliers, business reply cards, newsletters or toll-free response numbers; or public
relations elements such as publicity, events, speaking engagements, sponsorships and
opinion polls. Perhaps you can accomplish your objectives and cut costs by teaming up
with related, noncompeting businesses for in-store promotions or cross-promotional
campaigns. Online promotional opportunities are more abundant than ever, so consider
designing a Web site or uploading information into a news group or special interest
forum.
Write out each strategy, and beneath it, list key messages and tactics. Here's a
sample:
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Strategy: Position myself as the market leader in home inspections in my community.
Key messages: Homer Wright Home Inspections is a reputable, trust-worthy name in
home inspections.
Tactics:
Approach local community colleges about teaching a home-buying class.
Propose a feature story to a local paper about "10 Things to Look for When Buying a
Home," with me as the expert to be quoted.
Create a brochure entitled "Secrets of Buying a Home." Offer it free to people who
call.
Issue a press release about the free brochure to local media.
& Send informational brochures to real estate agents and mortgage brokers who
refer home buyers to home inspectors.
For each step you plan, keep asking yourself, "Why should I do this?"
Don't decide to do big, splashy promotions if you really can't afford them. Smaller, more
frequent communications are much more effective if your budget is limited. For
example, a small accounting firm wanted to increase its exposure in local newspapers.
The owner made a $10,000 donation to a local charity's annual gala, believing this
would make a great news story. While the gesture was greatly appreciated by the
charity and its supporters, that money represented the majority of the firm's annual
marketing budget. In return, the owner got one brief story in the local paper. If the organization's goal was to become more philanthropic, the donation would have been an
effective gesture. However, because the original goal was to increase publicity, the
money would have been better spent on a diverse program with more components.
Finally, be sure the promotions you've selected project the right image. If your audience
is conservative, don't stage an outrageous promotion. Similarly, if you need to project a
cutting-edge image, make sure your efforts are sophisticated.

HOURS 18-21: Budgeting Your Resources

Some business owners believe marketing is an optional expense. This is one of the
most tragic myths in business. Marketing expenses should be given priority,
especially in times of slow cash flow. After all, how are you going to attract more
business during the slow times if you don't tell customers about your business?
Take a realistic look at how much money you have to spend on marketing. While you
shouldn't overextend yourself, it's critical that you allot adequate funds to reach your
markets. If you find that you don't have the budget to tackle all your markets, try to
reach them one by one, in order of priority.
For each of your tactics, break down each expense and outline the estimated cost of
each. For example, a brochure includes writing, photography, graphic design, film,
printing and delivery. From there, you can beef up or pare down your plan,
depending on your financial situation.

HOURS 21-23: Timing Your Projects

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Now that you've broken down the steps involved in each activity, allot a segment
of time and a deadline to each. Again, make sure you're not overextending
yourself, or you may get burned out. It's better to start with smaller, more
consistent efforts than an overly ambitious program you'll have to discard a few
months later.
HOURS 23+: Go For It!
What you now hold in your hands is probably the most effective "to do" list you'll ever
write. You have prepared a document that can help you reach your market segments
from a position of knowledge and expertise instead of from shoot-from-the-hip
hunches.
Don't put your marketing plan on a shelf and forget about it. It should be a living
document that grows and changes over time. As your business reaps the benefits of
your initial strategies, you may want to increase the scope of your marketing. If you
find something is not working, change it.
Consistency and continuity, delivered with a dash of creativity, give you the formula
for successful marketing.
Sock It To 'Em
The Argyle Studio used their marketing plan to keep them focused as their business
evolves.
Daryl Felicetta woke up one morning and said, "Oh my God. I have a business." In less
than one year, her advertising and graphic design firm, The Argyle Studio, had grown
from a few freelance projects to a respected studio with high-profile clients and a
steady stream of revenue. When Marion Reinson joined the Metuchen, New Jersey,
company as Felicetta's partner in 1991, it became clear the duo needed to put some
new systems in place to achieve the growth they desired. They created a marketing
plan dubbed "The Living and Breathing Document." Felicetta describes it as "nothing a
bank would ever want to see."
The Argyle Studio's marketing plan is a record of all the firm's marketing efforts and
plans for growth. It includes client profiles as well as promotional strategies and
tactics. In addition, it archives previous promotions that didn't produce the desired
results, analyzes particularly successful programs, and projects future needs such as
training or new equipment.
According to Felicetta, the document's primary goal is to keep the partners focused on
their core business values. "The landscape of our business has changed dramatically
over the past year or so, as we began offering Web site development," Felicetta
explains. "The marketing plan has helped us stay balanced, rather than allow one
segment or one client to become an overwhelming portion of our business."
Felicetta and Reinson, both 34, look forward to their annual plan review. First, they get
together in an informal, relaxed setting to discuss the effectiveness of the plan and
brainstorm ideas for the coming year. With no phones ringing and no clients
demanding immediate attention, they focus on revisiting their goals. Then, in a more
structured session a few days later, they rewrite the plan, fitting their analyses and
new ideas into the existing document.
Felicetta estimates Argyle's business grew 100 percent the first year they instituted the
marketing plan and has continued to grow at an astounding rate of 50 percent or more
annually since then. The firm, which is based in Felicetta's home, now has five
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15
employees and a pool of freelance talent.
Felicetta warns budding marketers not to get caught up in making their plans too
formal, but rather to make sure the format is easy to use. "After reading about other
companies and their plans, I've found the most successful were those that didn't try to
be anyone else," says Felicetta. "What they sold was their philosophy-and people
bought it. We really found ourselves when we realized that."

1.3.

Finding Appropriate Prospect Lists

How to hit a bulls-eye when defining your marketing demographic

Q: I've opened a new business in a fairly competitive area and am planning to mail out some
informational brochures about the services we offer. Where I can find the names and
addresses of my target market?
A: U.S. businesses will spend nearly $50 billion on direct-mail marketing efforts this year.
From retailers to marketers of consumer products and services, finding the best lists can
mean the difference between success and failure for many businesses that target consumers
in their homes.
The more precisely you target your audience, the greater number of qualified responses your
program will generate. Typical positive response rates for direct mail are just one to five
percent, so the majority of your respondents must fit the profile of your ideal client or
customer. Before you approach list vendors, define the characteristics of your target audience
using such demographics as age, gender and household income, and refine your geographic
market. You might decide, for example, that your best prospects are married, homeowners,
age 50 and higher, in specific zip codes.
List rental companies call these demographic characteristics "selections" and price their lists
accordingly. Lists are rented on a cost per thousand basis (CPM) with an additional charge for
each selection. If you intend to follow up your mailings with telephone calls, you can expect
to pay an additional fee for a list with phone numbers.

1.4.

Market The Right Image

Tips for creating a marketing plan that attracts the right attention

Q: I'm thinking about opening a children's fine clothing boutique, and I have several great
marketing ideas. A new hospital just opened less than a mile from the proposed store. Can I
make some type of advertising offer through the maternity ward? Is it bad marketing to
distribute fliers in my large competitors' parking lots? I'm also planning to contact the PTA at
nearby elementary schools for a fashion show and fund-raiser. Any thoughts or other
suggestions?
A: First and foremost, it's important to make the way you promote consistent with the image
you wish to project. Unlike megastores that offer low prices to the masses through hundreds of
outlets, your unique boutique must draw from a carefully targeted market within a small
geographic area. Instead of fliers on car windshields, which would cheapen the image of your
"fine" apparel, create an upscale direct-mail campaign to households with the right
qualifications within a 5- to 10-mile radius of your boutique. Support your direct mail with
advertising in local publications that reach parents and have appropriately targeted subject
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matter.
Since you plan to offer fine clothing for children in your new boutique, develop a creative
marketing message uniquely different from that of your major competitors. Devise a slogan or
theme for your store's campaign to carry through into your advertising and promotional
activities that focuses on quality, value and the finer aspects of the apparel you offer.
Lastly, special promotions are a great way to build awareness for your new boutique. Your
fashion show idea sounds like a winner. While you probably can't advertise in the local
maternity ward, you may be able to offer a gift to new mothers that's accompanied by a gift tag
with information about your store. Join local organizations whose memberships consist largely
of parentsif the groups are focused on children's issues, so much the betterand get involved
with membership drives and contribute door prizes. Set up in-store promotions that build
repeat business, such as forming a "Grandmothers' Gift Club" to give all grandmothers a special
discount and notices of upcoming sales. When new members join, you can record their
grandchildren's birth dates, then mail friendly reminders with gift suggestions.

1.5.

Marketing Plan Makeover

Is it time for an update?

Q: I'm the owner of a computer software design company, and I need to update our marketing plan.
Where can I get examples of some good plans and/or programs? I'd appreciate your help.
A: It's a great idea to update your marketing plan annually and to review and adjust it quarterly. A solid
plan should consolidate all the required information within an easy-to-follow structure. Over the years,
I've developed an effective format with five concise sections:
1. Situation analysis. Begin your plan with a realistic overview of your competition and how you'll
position your company against them. Outline the challenges you face, then describe the benefits that set
your company apart.
2. Target audience. List each primary and secondary target audience followed by a description of each.
If you're marketing to consumers, include a profile of your target audience based on demographics, such
as age, gender, household income and location. For a B2B plan, describe your targeted business
categories and the qualifying criteria for prospects in each.
3. Goals. Make a list of your marketing goals, and assign a completion deadline to each one. It's vital to
make your goals quantifiable. For example, it will be easier to measure your success if your goal is "Gain
three retail accounts by September 30" than if it's "Win new retail accounts."
4. Strategies and tactics. This is the heart of your plan. Define each of your marketing strategies, and
outline precisely which activities you plan to undertake and the tools you'll produce to achieve your goals.
How will you use advertising, direct mail, public relations or the Web to reach your target audiences?
What types of brochures and sales tools will you create and in what quantities? Describe your tactics, and
attach media and production schedules with completion dates.
5. Budget. Once your tactics are fully outlined, you can determine the costs to execute each one. If the
tactics you've selected are too costly, you can easily re-evaluate them and look for more affordable ways
to reach your goals.

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1.6.

Improve your marketing.But first you MUST answer to these 6 questions

1. What are you marketing?

Before you outline your marketing objectives you must identify your organisations product, service, or
benefit. Ask what your project or organisation is about:

What do you do?

What is your special quality (your unique selling point)?
How does your offering differ from your competitors or similar organisations?
How do you want to be perceived?

2. Who are you trying to reach?

Try to find out as much information about your target audiences as possible: their age group, social class,
interests, lifestyle and region.
Potential target audiences are:

Service users or beneficiaries.

Volunteers.
Individual donors and funders.
Families and friends of the beneficiaries.

3. What are your marketing objectives?

These need to be measurable and timed, e.g. a 10% increase in users or volunteers over six months.
However, you also need to be sensible about what you can achieve. It is a good idea to create your
marketing objectives in a yearly plan. Since you are marketing to a number of people, you are going need
a separate objective for each audience. The five Ws will help you define how you are going to do it, and
you should always check them when considering any form of communication:

Why?
What?
Who?
Where?
When?

Added together, these five points = How.

4. What methods will you use?
What are you going to use to market your organisation or project? Marketing vehicles include:

Direct mail - post, door-drop.

Face-to-face - e.g. door-to-door selling.
Telemarketing.
Advertising.
Website.
Events and promotions.
Sponsorship/partnership.

Planning and timing are essential. Plan which days, weeks or months are best to approach each audience.
5. How do you want to come across?
How you are perceived is essential to your organisations brand identity.

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Establish your key messages - a maximum of three.

Outline your core differentiation, strengths and offerings.
Summarise this into three-word statement. Tesco has every little helps, Fairbridge has helping
inner-city youth, the Media Trust has helping charities communicate.
Customise the tone and style of your literature to each audience. One tone will not be suitable for
all audiences.
Invest time and effort in your literature. It is crucial to have accurate and accessible
communications - befriend or invest in a copywriter if you are uncertain about writing clear, simple
copy.
Memorable names and logos are an advantage - if your organisations name or logo is difficult to
use, resize or remember then perhaps it is worth reviewing or redesigning it.

6. How do you evaluate whether your objectives have been achieved?

It is important to measure your success, especially for future funding or building awareness. Everyone
likes facts and figures - they prove that your organisation is or is not making a difference. In addition to
measuring numbers you can:

Organise focus groups with your different audiences. Ask what they think of you, whether they are
satisfied with how you communicate to them and how it can be improved.
Collect feedback, whether this is by email from your website or by a survey in an annual piece of
literature.

If you find that you aims are never accomplished perhaps have a brainstorming session with a person
from each division in your organisation. Keep asking whether your objectives are realistic and keep trying
new ideas.

1.7.

Prying Eyes
The cry has gone out from Web surfers everywhere: "Stop looking at me!" How can
your marketing plan respect their wishes?

Nothing has quite stirred passions lately as much as the topic of Internet privacy. Everyone
seems to have an opinion on the topicwhether you're talking to business owners or their
customers. Even lawmakers are struggling to get a handle on the issue; more than a dozen bills
proposing various regulations have already been introduced this year.
On one hand, you have your customerswho, incidentally, have become increasingly tech-savvy.
They're now demanding greater restrictions on the use of their private data as well as
accountability from the companies that collect it. Some even remain reluctant to engage in ecommerce altogether, fearful that their personal information may be shared with other businesses
or government agencies down the line.
Then there are the entrepreneurs who walk a fine line between
collecting the information they need to build better customer
relationships and scaring shoppers away. It's a tall order to reassure 94%
customers that collecting their data is necessary, that it truly benefits of U.S. Internet users
them and that their privacy will never be compromised.
believe Net firms and
top executives should be
"Rising consumer concerns, technological advances and business punished if they violate
pressures will make privacy one of the hottest areas of the Internet users' privacy online.
policy debate in the next several years," confirms Jay Stanley, an SOURCE:
The
Pew
analyst at Forrester Research.
Internet & American Life
Project
Meanwhile, lawmakers are continuing their attempts to nail down more
stringent requirements for Web businesses. Last year, for example,
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19
Congress passed the Children's Online Privacy Protection Act, which makes children off-limits to
aggressive data-collection and marketing techniques. And experts expect even more privacy
legislation to pass this year, especially with so many bills regulating numerous privacy issues
pending.
But compliance won't be cheap. According to a study conducted by the Joint Center for
Regulatory Studies of the American Enterprise Institute and the Brookings Institution and
underwritten by the Association for Competitive Technology, adhering to the new Internet privacy
rules could cost businesses a combined $9 billion to $36 billion.
The secret for entrepreneurs is in finding the perfect balance. "Modern technology, especially the
Internet, has made the collection of personal information easier, faster and more thorough," says
Walter O'Brien, executive director of the Privacy Leadership Initiative, a New York City partnership
of CEOs from major corporations and business associations. "And that makes many people
profoundly uncomfortable. There's a trust deficit of troubling proportions that keeps too many
consumers on the sidelines. "For any company, the stakes in missing so many 'wary but wired'
consumers are enormous."
Keeping the Faith
So with all the controversy swirling around the privacy debate, what's the best way for
entrepreneurs to earn trust from customers, yet gather the information they want at the same
time? For starters, experts say Web sites that collect personal information from or about
consumers online should comply with the four widely accepted fair information practices: notice,
access, choice and security.
That means you should write a privacy policy and disclose to consumers exactly what you intend
to do with their information. Post the policy prominently on your site and provide those
consumers not only access to their information, but the means to challenge data that's incorrect.
Also, give customers the choice to opt out. Finally, be sure you protect the security of the
information you collect. As long as you're upfront and do what you say you're going to do,
customers will continue to trust and shop with you.
"Consumers don't mind giving information if they know it's going to be in the trusted hands of the
company they're doing business with," says Silvana Gragossian, co-founder of DecorLine, an
online retailer of original art and craft items. One of the first things this six-employee Encinitas,
California, firm did when it opened in 1999 was construct a privacy statement.
Written with the help of a lawyer, the statement says DecorLine is committed to protecting the
privacy of its customers and that the information collected on the site is used solely to process
orders and enhance the shopping experience. DecorLine occasionally sends e-mail notices to
customers, informing them of new services, products and special offers, so recipients are always
given the chance to opt out. But few take DecorLine up on its offer. Gragossian, 37, says, "We
rarely get a request for removal from a user."
Astrocenter.com Inc., which owns Center.com, a wellness portal in San Francisco, takes a
different approach to consumer privacy. The site offers members free health, beauty and fitness
information, along with personalized horoscopes and astrological reports. In its privacy
statement, Center.com says it not only uses demographic and profile data to personalize services
to match customer interests, but it also shares the information with advertisers on an aggregate
basis.
The statement further explains that Center.com might share personal information with other
companies. "Our customers can check a box that says they would like to receive special offers
from our partners," says Jeremiah Rosen of Center.com. "If they don't want the offers, they don't
have to check the box."

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However, Rosen points out that even if members opt out of the offers, their information is still
part of the sites database. The way he sees it, if consumers don't want their information shared,
they can unsubscribe from the site. "We aren't trying to hide anything," he says. "It's clear that
we sell advertising; how we do it is by selling information about our audiences." Given the site's 3
million monthly visitors, the model doesn't seem to deter customers.
"Center.com understands visitors want their privacy protected," says Eric Bonjour, 42, co-founder
and CEO of Astrocenter.com. "That's why Center.com is committed to fully disclosing what and
how information is gathered from site visitors. Should users choose to examine our privacy policy,
they will clearly understand how personal information is usedon an aggregate basis only."
But as times change, you may need to alter your privacy policy. Take a
lesson from eBay: Recently, the online auction site changed its privacy
policy to include a stipulation that stated it reserved the right to share
customer information if the company merges or is acquired. EBay
decided to do this after another online retailerToysmart.comwent
bankrupt last year and made headlines when it attempted to sell its
customer database, even though its privacy policy had stated that it
would never share that information. The FTC, as well as privacy
advocates, contested the sale, and the list was ultimately destroyed.

65%
of customers surveyed
said they "sometimes"
or "always" read privacy
statements.
SOURCE: cPulse

Like eBay, you should explain that your policy may change from time to time. It's not a bad idea,
especially considering the fact that laws may change. Customers should always be notified of any
alterations and given the opportunity to notify you if they don't agree to the changes as
described. Of course, that doesn't take away the need for customersnew or existingto always
be given the opportunity to opt out if they're not happy with the policy.
"You have to give customers a choiceit's their information," says Gragossian. "Customers come
to your site and give you their informationso you just can't take that lightly."
How Far is Too Far?
Most consumers don't mind sharing personal information for marketing purposes with a company
they trust. In fact, shoppers provide personal information all the time, especially if they're offered
a freebie to do so, or if they get access to a personalized Web site.
A recent survey by the Pew Internet & American Life Project, a nonprofit organization that
evaluates the social impact of the Internet, found that while U.S. Internet users want a guarantee
of privacy online, they're willing to give Web sites personal information in return for content they
like. In fact, 54 percent of respondents had done it, and another 10 percent said they'd be willing
to.
What consumers do object to is the way some Net businesses track users across multiple sites
without their knowledgeand collect huge amounts of information about them, such as spending
habits, income, illnesses and occupation. Then these companies try to make money with this
information. Not surprisingly, consumers also don't appreciate when a company says one thing
about how they handle their customers' private information but then does something different.
Take TiVo, for example. The maker of digital video recorders was put in the hot seat earlier this
year when it was revealed that the company didn't clearly disclose how much information it
collects about users and their TV viewing habits. Privacy advocates pointed out that TiVo
recorders, located in users' homes, were set up to automatically transmit streams of data, such
as detailed viewing information, to the company's headquarters each night. This was in direct
contrast to statements made in the recorder's owner's manual, which asserted that "unlike the
Internet, all of your personal viewing information remains on your PTV receiver in your home."
TiVo says that phrase has since been removed from the manual and that data-collection policies
have also been modified.
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If you don't want to find yourself in hot water, think in terms of full disclosure. "Companies must
fully inform their customers of what they'll do with their information and explain why it's needed
and how it offers value," says privacy expert Dr. Alan F. Westin, president of the Center for Social
and Legal Research in Hackensack, New Jersey. "They also must give them choices and show
that they respect and implement those choices."

Comfort Factor

SOURCE: The Gallup Organization

1.8.

Find Time for Marketing

or kick yourself later when your client pool dries up. Here are 6 ways
to make time for marketing.

Q: I started my homebased graphic design business about six months ago. My problem is, I'm
spending so much time working on projects for my existing clients and managing my business
that I can't seem to find the time to market to new prospects. I'm worried that I won't have
enough work in the pipeline to keep my business going once I'm done with the projects I'm
working on right now. What do I do?
A: You're smart to be thinking about this now before it's too late. The principal issue here is time
management. When you're starting a business, you're wearing several hats at once. You must
deal with client demands and deadlines, cash-flow issues, personal and family "crises"--and
you've still got to go out and market your venture. Here are six tips to help you free up time for
marketing, even when you have several "plates" spinning at once.
1. Make marketing a priority. You must commit to making time for marketing--whether to
attend networking events, put together a brochure and business card, research prospects
on the Web, or write a proposal. Without a strong commitment, you'll find yourself
consistently putting off your marketing efforts, which could haunt you a month or two
from now.
2. Plan ahead to diffuse crises. It's hard to market your business when you must spend
the bulk of your day dealing with urgent matters. Anticipate potential problems and do
what you need to do to diffuse them ahead of time. As you plan your week, ask yourself
"What are the worst things that can happen this week?" Then devise a plan of action to
deal with those situations before they blow up into time-consuming crises. When you're
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proactive in managing your time, you reduce the number of unexpected crises that you'll
have to face in the next week, freeing you up to devote more time to your marketing
initiatives.
3. Cut the fat.
A common mistake new entrepreneurs make is not focusing on their
most important tasks. As a result, they're spending hours upon hours working but aren't
really getting anything done. So, create time for marketing by evaluating your schedule to
see where you can "cut the fat." Which activities are most crucial to you achieving your
goals? Which tasks can you effectively delegate?
4. Consolidate your activities when possible. Plan ahead to accomplish tasks in a single
trip. Bulk group-related activities together. If you have client and prospect meetings
outside the home office, try to cluster them within the same vicinity. Do this with your
errands as well. Decide which ones you can complete while you're on appointment. Why
take extra trips when you don't have to?
5. Avoid telephone interruptions. Break the habit of answering the phone every time it
rings. This means giving yourself enough respect to say "That call needs to go to voice
mail so I can focus on the person in front of me right now," or "That should go to voice
mail because I'm on a roll with this project and it's most efficient for me to finish right
now." Schedule time for answering and making phone calls and checking your voice mail.
This way, you can get more done without the stress created from the phone ringing off the
hook.
6. Cultivate positive thinking. Negative emotions like worry, frustration and anxiety waste
time and cause you to panic. And it's hard to market your products or services when
you're stuck in panic mode. When things don't go according to plan, ask yourself "What
can I learn from this situation that will push me closer to my goals? What can I do now to
make today more successful, despite the setbacks? Say no to anxiety and "rescript"
worries into proactive and positive thoughts.

2. WHAT IS A BRAND?
2.1. How to build a brand
A legendary DDB ad-man and a well-known marketing director provide
their brightest brand insights.
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How do you define a twenty-first-century brand, and even more important, how do you manage a brand
successfully in a new business era?
Follow the five I's--"intrusive, intriguing, interactive, informative, and 'inter'-taining"--says Keith Reinhard
of the multinational advertising firm DDB, who presented his take on branding during "The Rise and Fall of
the Brand," a day-long conference organized by the Office of Executive Education and the Atlanta Ad Club
as part of Exec Ed's ongoing Marketing Leadership Series.
Reinhard is perhaps best known for his legendary brainchildren of the advertising world, including the
"Bud-WEIS-er" frogs, the Michelin babies, and the classic McDonald's ditty "two all-beef patties, / special
sauce, / lettuce, cheese, / pickles, onions, / on a sesame seed bun."
He described DDB's latest innovation in advertising: creating "brand foundations" for its clients, in which
an organization defines its mission and then transforms itself before unleashing a new message via a fullscale, multi-media advertising blitz.
"In the next ten to twenty years, the organization known as the advertising agency will have transformed
itself into an agency that not only builds brands but also creates and licenses them," Reinhard told the
one-hundred-plus conference attendees. "It probably will have merged with an entertainment company
and an Internet company. It'll be back to the future' to brand-created and brand-sponsored content--an
approach similar to the soap operas created by Procter & Gamble to sell soap."
The conference's second keynote speaker, Al Reis, author of Positioning: The Battle for Your Mind and The
Twenty-One Immutable Laws of Branding, attacked the topic of twenty-first-century branding from a
theoretical point of view. "Your brand is your company. Manage the company for its brand," he said. "The
way to build a brand is to think narrow."
Reis told attendees to define a company's strength--singular--and then exclaim it to the world.
"And if you can't be first [in your category], set up a new category to be first in," he said. "[Market]
leadership is the most powerful thing you can communicate."

2.2.Successful brand building creates a belief in the consumer's mind about your product or
company.
People buy products or services, but they TRUST brands.
Simply stated, successful brand building creates a belief in the consumer's mind about your
product or company. People buy products or services, but they TRUST brands.
You can have the entire world thinking you're "The Choice of a New Generation." Or you can
convey how your product "Melts in your mouth, not in your hands." Branding can sway
consumer loyalty from one product to another (it's called brand wars).
And brand building can evoke images in the consumer's mind. When you hear Walt Disney
World, you can easily envision Mickey Mouse standing in front of the Magical Kingdom. The
brand has a lasting impression. According to Hall of Fame creative Ed McCabe, "I'm not
interested in day-after recall. I'm interested in a 10-year recall."
Of course, brand building is a complex issue that involves a variety of stages. Here are a
few steps you need to cover if you're going to build a brand.
Brand Strategy
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Determine the kind of brand that will work best: Monolithic, shared, endorsement,
decentralized, etc.
Brand Identiy
Create a name, category, and personality that will personify the brand.
Brand Position
Differentiate from and associate with your competitors.
Brand Value Proposition
Show why people should choose your brand.
Trade Dress
Create a look that you will consistently use to express your personality.
Visibility
Reach the right people, in the right context, with enough frequency and impact.
Customer Experience
Make every contact reflect the brand personality and ethos.
A lot of companies have built brands based on their name.
Several years ago there was a new startup computer business that wanted to break into the
school market. They decided the best way was to target educators. In doing so, they chose
a name associated with teachers for centuries: Apple. The rest is brand history.
A name can become ingrained into our culture thanks to years of brand building. For
example, do you order a soda or a Coke at a restaurant? Do you Xerox or copy documents?
When you blow your nose, do you ask for a Kleenex or a tissue?
Creating a personality is another essential element in brand building. A brand personality
allows you to stand out in the competitive market place. It can change the consumer's
attitudes, and create a belief that you're the best choice. Even if you aren't the number 1
choice. And even if there is no appreciable way to differentiate you.
Being second best made Avis the top dog in the rental car category. They used this negative
position in the marketplace to brand themselves as the company that tried harder than
Hertz. And it worked.
By differentiating yourself from your competition, the consumer has a reason to choose your
product over the other guy. The following tag lines gave each brand a personality that
boosted them above the competition. Can you guess the brand name?
1. We bring good things to life.
2. Pizza, pizza.
3. Just do it.
4. You deserve a break today.
5. We'll leave the light on for you.
6. Look, mom, no cavities.
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25
7. Plop, plop, fizz, fizz, oh what a relief it is.
Don't mistake brand building with simply creating a few ads. First, you need to know where
your product stands in the marketplace. Does the consumer know who you are?
According to Lee Clow of Chiat/Day, "You have to accurately and faithfully translate the
company's culture, spirit, and point-of-view to the consumer." This kind of information
allows you to position your brand. Is it the best? Does it get more miles per gallon? Is it a
better value? Will it make people healthier? Is it new and improved?
While brand position helps differentiate a company from the competition, it can also give the
consumer a reason to choose their product. Take Volvo cars. They've positioned their cars as
the safest available if you're in an accident. Basically, they made choosing a car a life or
death decision. And they are consistent with their message.
No straying from the point is allowed if you want to build your brand.
Budweiser has always been the King of Beers. They communicate this brand building
philosophy on every piece of communication they produce. No wonder they own over 48%
of the beer category.
But brand leadership isn't easy. Or cheap. After all, you don't become the King of Beers
without constantly reminding the consumer.
In the 1920's Hershey owned over 90 percent of the chocolate market. Getting there
required a heavy marketing push. Once they owned the category, they suddenly stopped
advertising. The door was opened for the competition to come in and take over. The result
was a loss of over 60 percent of the market share in chocolate for Hershey.
So once you've built your brand, protect it. Guard it. For larger companies that's the job of
the brand manager. For smaller groups, it's often the CEO or marketing manager that must
zealously protect the brand. Of course, we think that's our job too.

2.3.

How to create, characterize and build a brand

This is "branding" for creative people. Those of us who bring the brand to life in print, TV, or web sites.
To do that, there are three things you need to understand or create:
> The brands personality.
> The relationship the brand has with the audience.
> Visual icons, symbols or other representations of the brand such as the logo or a character.
So the three steps to building a brand are:
1) Create a character or personality for the company, the product or service. Just as you would for a real
person, based on that brand-person's reputation, attitudes and behavior.

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2) Build a relationship with your target market based on that personality. Do this over time, using
advertising in addition to all other communications, including the way employees are trained to interact
with customers.
3) Reinforce the relationship and trigger recognition with consistent visual symbols. These symbols can
include everything from a color scheme and logo to an imaginary character, or even the president of the
company.
Corporate brands and product brands:
> Generally, the corporate brand should be based on genuine qualities that exist in the company itself.
Ideally, the corporate identity should reflect the company's culture, values and practices.
It's difficult or impossible for a competitor to duplicate your client's culture. Much easier to copy the
product or service.
> Generally, when creating product and service brands you can exercise greater tactical freedom. Take a
sharp, critical look at competitors in the market category. Then devise a brand identity that will appeal to
consumers.
Yes, it's great if that identity is similar to the parent or corporate brand. A recognizable part of the family.
But it doesn't have to be so, so long as it works.
OK, with apologies to all the theorists who are wincing at these generalizations, let us now venture into
the mysterious realm of the Real World.
Think of some brands. Could be Sony or McDonald's. Microsoft or Nestl. Maybe Yahoo. Now think of those
brands, or one of their products, as a person.
Get real here, the way you really think and feel. Go beyond generalizations like, "young, exciting,
professional," or the like.
Obviously, some brands you recognize, but dont really know. Some you like, perhaps some you detest.
And some brands, like some people, are a part of your life.
Those are the brands you know very well. And by owning or using them, well, it says something about
you. In fact, when you can't buy them or find them or use them -- when you cannot interact with your
favorite brands -- you may feel disappointed. Dare we say disgruntled or depressed? "Mom, me and my
friends want to watch MTV!"
There are probably other brands you would like to bring into your life. Brands you aspire to posses.
Because they would say something about who you are by virtue of association. "Hey, check out my
genuine Rolex, man. Yeah, I'm makin' the big bucks."
Or more quietly, "I think I'll buy the Brand Zed pharmaceutical instead of the less expensive generic. That
way I feel I'm getting the best. And nothing is more important than my good health."
The artistry in all of the above lies in creating a brand that has a relationship with consumers, one that
fulfills a genuine psychological need, one that is maningful in human terms. Like a good friend. Or
interesting person. Or someone you admire or would like to associate with.

Get the idea? Then let's get down to business.

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For some clients you will need to create a brand personality for the company, and one for each individual
product or service. So for a large company with multiple services, you might create an entire family, with
distinctive personalities for each. Typically, a parent brand and sibling brands.
Now that you have a clear definition of the brand personality, bring it to life in your ads.
> In the way you write, which should express the brands personality, not the writers.
> In the appearance of your ads, which should be formal or friendly or whatever is appropriate to the
brands personality.
> And remember that a brand should differentiate the product from competitive offerings. Make it
distinctive.

2.4.

Branding Your Homebased Business

Household name? No problem--if you've got a few tricks like these up
your sleeve

Q: My goal is to build my home business into a brand name. How do I do stand out in a
crowded marketplace?
A: Build your brand around a real person, like Lillian Vernon, founder and CEO of giant gift
and houseware products catalog company Lillian Vernon Corp., who started her company as a
homebased business. It's reassuring to know that Lillian Vernon believes there's more to the
art of branding than a jumbo advertising budget. Here are some tips on how to create a
brand through the power of personality.
It's one thing to create a symbol, like Betty Crocker, and build it into a brand, and quite
another to build a brand around a person. The person needs to have the qualities that
underlie what you communicate as the company's strengths.

Communicate your brand's personality. You can convey personality with unique
products, clever presentation, a strong guarantee and other qualities that represent
promises you can keep. Vernon communicates in each of her company's catalogs, "I
am my customer's personal shopper, even though I have a team of buyers scouring
the globe."
Build credibility--keep your promises. Gallup has research showing that if
customers don't have a firm foundation of confidence and trust in a brand, customer
loyalty erodes. Trust in a brand also pays off because as a company moves into new
products and markets, the power of the personality helps improve the chances of
success. By relying on the key aspects of her personality, Vernon was able to extend
her credibility to the children's market by introducing a catalog with children's
products. The same has held for the online marketplace.
Rely heavily on public relations. If you as a personality are regarded as interesting
and creative, opportunities open up for magazine profiles and appearances on talk
shows.
Don't lose sight of your original values. Promises must be kept not just at first,
but always. As your company grows, it's easy to get sidetracked into ventures or
products that might not be worthy of the personality's claims to high quality or value.
For example, a new product line may not be of the same quality, or the company may
discontinue a highly valued money-back guarantee.

2.5.

Charity branding
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What
is
a
brand?
"Any visible sign or device used by a business enterprise to identify its goods and distinguish them from
those made or carried by others" - Encyclopaedia Britannica.

Your brand is the package which represents your organisation and differentiates it from other
charities.
A brand should make your charity's message clear to supporters and potential backers.

In a society fixated with image, branding is big business. A fittingly-conceived and well-executed brand is
essential to an organisation's survival.
Creating a successful brand
A brand is more than just a logo or an image. It provides a first impression of your organisation and
shapes the way in which the public perceives your work. The charities and voluntary organisations whose
brands are most profitable are those that successfully emulate and are comparable to corporate packages.
A clearly articulated brand should thus present to backers an unambiguous image of your organisation's
competency and professionalism. Developing and establishing a strong brand, moreover, will increase the
likelihood that potential backers will choose to support your organisation over a lesser known and less
well-marketed charity.

A brand should clearly express your charity's vision and values.

Ensure that the brand appeals to your target audience.
A recognised good brand is a result of consistent messages, steadfast marketing efforts, good
experiences and positively reinforced images emanating from your organisation over time.
Potential donors will probably interact with your brand before they meet the human face of your
organisation. A brand should make explicit your charity's needs and objectives while immediately
conveying to backers what it is you desire from them. It should also inform those who might
benefit from your services exactly what your organisation offers.
A brand must permeate internal and external communications. Make sure that the language and
attitude of your staff reflects the charity's brand and objectives. Your brand should also feature on
all materials issued by the organisation.
Be prepared to reassess and if necessary restate your brand.

Your organisation and its brand

Before presenting your brand to the market ensure that the charity can live up to its promises. Delivering
on your assurances will encourage people to trust your organisation. Failure to live up to expectations, on
the other hand, could do irreparable damage to your charity's reputation and support. You should,
therefore, take steps to ensure that your charity's brand is consistent with your goals.

Be clear about what your organisation represents and what you hope to achieve.
Talk to your stakeholders and investigate whether their expectations are in line with what your
organisation is doing.
Investigate how you compare with your competitors.
Look at who supports your brand and why.
Ask what it is that beneficiaries gain from your service.

Why rebrand?
If you decide to rebrand, be sure of what the process entails and of the benefits you envisage your
organisation will accrue.

Revamping your brand can reinvigorate the organisation, expose it to new markets and increase
financial contributions to your charity.
The image of a long-standing organisation might appear tired and outmoded. Distinctive images
and styles are closely associated with the era of their conception thus a timely repositioning has
the potential rejuvenate your organisation's image.

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Certain words or images might have a negative impact upon the success and marketability of your
organisation. Adopting a brand that is consumer friendly and which encapsulates your message can
significantly transform your organisation's performance and appeal.

The costs
For charities functioning on limited budgets, employing a branding consultant can be an extremely
expensive, perhaps infeasible, exercise. The budgets of many charities will not stretch to covering the
costs of a full-scale, professional branding exercise. Options do exist, however, for your organisation to
develop a good brand.

Investigate which businesses are willing to offer their services to charities on a pro-bono basis.
Concentrate on presenting a strong image in your defined market. Be aware of how global, medialed brands perform, and where possible seek to emulate their success.

Potential pitfalls of slick branding

Good branding can make a significant difference to the financial health and public awareness of your
charity. Nevertheless, some problems may arise. Charges of extravagance, for example, could seriously
undermine your brand's value if a donor disputes the value of paying the costs of a branding exercise with
funds they believe would better be spent on fulfilling your charity's brief.

Be careful to ensure that your organisation justifies its expenditure.

If you are convinced that a wholesale revamp of your brand will enhance your organisation's
performance, regard the project as an investment. Present evidence of likely advantages to your
organisation and its backers in defence of your proposal.

Ensuring the continued success of your brand

Measure the performance and perceptions of your brand through brand valuation surveys.

Gauge the responsiveness of existing, new and potential donors.

Assess the reactions of your employees and beneficiaries.
Ensure maximum impact for your organisation's brand by monitoring and responding to your
audience's changing needs.
Remember that branding and advertising, especially when they are well-executed, stay in a
person's mind. Be consistent and persistent in your publicity and in the messages you project.

2.6.

Branding on the web.

In simplistic terms, branding refers to establishing such a strong identity for your product or service that
potential users or customers think of you first when they're in the market for that particular product or
service.
And, with all the competition on the Web for the attention of the casual surfer and certainly prospective
customers, you need to not only differentiate yourself but to become "the source" in your category. Even
large, successful companies are actively developing a strong online brand. So, how do you do this?
In this issue, we'll give you examples of some well-known companies'
efforts to establish an online brand identity as well as some ideas on
what you can do to become a brand yourself.

29

How do you compete

with large, well known
companies to create a
brand identity?

30

Using Your Brand in a TagLine or Slogan

In the past few months, more and more online businesses are going offline to advertise their brand name
in TV and radio ads. In fact, start noticing how many zero in on their brands as being the "source" and use
their name repeatedly both verbally and visually.
What Can Branding Do For You?
In an article called "Cyberbrand study: Web Branding Opens Links to Customers" by Alice Z. Cuneo, in
Advertising Age's NetMarketing Online (the article is no longer available online), the author pointed out
that "strong product branding on the Internet can provide marketers with a powerful advantage over
competitors." The comments in this article come from a survey of 4,000 brand management, creative and
production professionals. This survey, by GISTICS Inc., a Larkspur, CA-based research and consulting
firm, found that successful digital brand building requires a two-part strategy: "One focuses on the
business process, that is, how a company finds, serves, and satisfies its
customers. The other targets the branding process, in terms of how a
company manages media and positions messages in competitive and
A strong brand on the
confusing markets."
Web
will
result
in
higher
sales
and
This study suggests that "because the Web site is the No. 1 brand builder conversion rates as well as
in cyberspace, its development and operation should not be relegated to more opportunity to sell
technical staff who might have little regard for brand equity."
additional items into the
aftermarket.
For example, Compaq Computer Corporation created a new position to
oversee the company's cyber brand, from internal intranet communications to managing product line and
support. Peter Himler, of Burson-Marsteller, New York, said that "It's not enough just to hit the consumer
with messages. Messages need to do more, to have an interactive capability and a direct response
capability."
Is the Web best used for branding or direct marketing?
When you read articles in the sources stated above, you'll see a wide variety of opinions. Try to
understand what the issues are and how they relate to your business goals. Becoming the SOURCE or
BRAND for a product or service is not easy for small site owners, particulary if they're not the first entries
into the marketplace. Obviously, it takes a large budget to generate brand identity when you're unknown.
What to Do When You're Not a Well-Known Brand--Tips and Techniques for Competing With
Those Who Are
Use a domain name, tagline, or product name that prospects can remember. Many domain
names have hyphens, which break them unnaturally, or strange spellings. Sometimes you can't access
them without searching for the correct URL.
Offer an advantage of buying from you rather than the brand names. This could be lower pricing,
personal service, etc. Any service at all would be an improvement over a lot of companies on the Web,
including some of the biggest companies!
Show your physical address and contact information, including phone, fax, and email address. And,
respond when you're contacted.
Offer interactive capability. For example, set up automated email follow up that keeps reinforcing your
brand name. Or, try adding a bulletin board to your site so users can interact with each other.
Offer a guarantee on your products or services. Specifically, offer a money back guarantee for a
specified period of time.
Set up your site so it's easy to find what you're selling. Some sites are arranged so poorly that you
must wade through too many pages to find the product or service sold there.
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31
Offer several options for purchasing, such as online, fax, phone, or snail mail.
Indicate a quick delivery in terms of a few days.
Make sure customer service personnel answering your phone know about your Web site and the offers
made there. We've called phone numbers shown on Web sites only to reach someone who doesn't appear
to know what a Web site is.
Get testimonials or good reviews for your product or service. Well-known reviewers and satisfied
customers can help substantially in establishing credibility. The comments should be as specific as possible
regarding the benefits of the product or service.

2.7.

Web site creation and promotion

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Web site creation and promotion.

How to position your site in relation to competitor.
Amazing how one simple thing can make
32
the difference between life and dot.com death.
How to create your site's brand identity. Take a tip from today's top marketers, and "Think."
Now that doesn't cost much, does it?
How to make your site magnetic.Want to increase the number of unique visitors by 100% to
200% or more? This is how you do it.
How to design an inviting, sticky and addictive site. Once you've got them there, this is how
you keep 'em clicking' and coming back for more.
> "Well, feckin' a," as some Irish say, "'tis a World Wide Web we've woven."
For some companies, the most promising. For others the most devastating. For all, the
fastest changing evo-revolution in the history of marketing.
This is Basic WWW for ad and marketing people. Those who need to know what the Web can
do for their company and clients. How to integrate it into their marketing strategy. And how
to make an effective site. With the option to learn more if they have the time and interest.
How to position your WWW site in relation to competitors.
Case study

For your consumer, a site's

"position" is that one simple
thing that first comes to mind
or heart. If anything.
The "brand" is everything else.
From appearance to
reputation. From personality to
values, such as 'this product
stands for quality and
reliability.' And including
credibility: Can I trust this
company? Who are they?
Where are they?

Cracker is positioned as an "i-tool to create ad & marketing

ideas." That's how we want you to think of us, the first notion
to spring to mind. So if you need to create an ad, or
campaign, or come up with a big marketing idea, you just
might give us a click.
Our positioning statement is simple. It's expressed in a way
people really think, with common English words. And it
differentiates us from other web sites.
A little Blah, blah, blah.
1) Everyone knows, or has learned the hard and expensive
way, the advantage of being first to market with your site.
There are a few tricks if you are entering late. One is to
position yourself differently. So instead of "That's another
online office supply store." Maybe you're the online office
supply store with the daily dollar discount.
The daily dollar discount is a loss leader, a product sold at or
below the wholesale cost. Yes, you can say, "that's a sales
promotion," which it is. But it's also a way to attractively
position your site in the market. In the consumers mind,
you're the "online office store with those daily dollar
discounts." And for some, that's a reason to look, try, and
continue buying.
And friend, if your entering late, you've got to buy market
share, one way or another. And clever positioning is one way
to do it.
2) The other major positioning consideration for WWW sites
concerns the extraordinary pace of change.
32 not a stay-on-top-of-it issue for companies
That's typically
with products or services that remain essentially the same. For
instance, a corporate web site for a company in the industrial

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3.

3.1.

RULES OF MARKETING

10 immutable rules of marketing

The good news is, you have a great product to sell. The bad news is, no one will ever buy that product.
How can I be so sure? Because customers don't buy productsthey buy solutions to problems. And that's
the whole secret behind marketing. Marketing is nothing more than understanding what a customer really,
really wantsand then showing them how you'll provide it. Marketing is about learning what makes
people tick. It's having the common sense to know that kids like ice cream on hot days and that holiday
shopping is a hassleand then using those shiny nuggets of data to fill a need. Marketing means creating
brochures, a Web site and products that make people say "That's exactly what I want!" It's about finding
customers' hot buttonstheir real desiresand then pressing them to make the sale.
That kind of marketing is what makes a colored sugar-water called Coca-Cola one of the best-selling
liquids on the planet. It's what makes us all eager to know Victoria's Secret. Because from corporate
giants to two guys in a garage, effective marketing is what separates business success from
entrepreneurial purgatory. Marketing isn't just about productsit's about the people who buy them.
But old mindsets stop most entrepreneurs from grabbing marketing success. It's time to forget fancy pie
charts and Madison Avenue budgets. According to mega-selling marketing guru Jay Conrad Levinson,
marketing has gone guerrilla. It's a street fight to win customersby finding clever, convenient, appealing
ways to fill their needs.
In that spirit, we set out to find 10 key marketing strategies for your start-up. Our answers came from the
unlikely combination of a pair of Internet gurus, a management consultant and a brainy Playboy
centerfoldeach one an expert at knowing exactly what customers want. Mind you, the techniques we
discovered aren't exactly your father's marketing plan. But today's businesses aren't your father's, either.
1. Discover customers' needs.
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Think backwards.
Johnny said, "Here's a great product I can sell." But his business bombed. Janey said, "What
a great customerwhat can I sell her?" Now she's rich. If you want start-up gold, then shift
your entrepreneurial thinking into reverse. Stop searching for "a business to start". Don't
hunt for "a product to sell." Instead, start looking for customers. Understand what they
need. Then build your business around them. Bingo! You're a market-driven entrepreneur.
Right now, in the margin, write down one kind of customer you can reach, such as "boat
owners." Then list things that customer might need, like fishing gear and trailer hitches.
You'll find a business with guaranteed customerssince that's where you started. Want to
move forward? Then start thinking backwards.

2. Know your customers

Get personal.
"Smart, young professional with a hectic career and lots of friends; hates moonlight
strolls but loves whitewater rafting; seeks a simple life plus excitement . . . " An ad from
the personals? Actually, that's the customer profile we'd use to start a new e-zine aimed
at young, urban women. The moral? Know your customer. You can answer it allfrom the
product, to the price, to the color of the boxby knowing what your customer wants.
Kaila Colbin, 26, and Ken LaVan, 31, take that approach for their Fort Lauderdale, Florida,
company thoughtSource Inc., which offers lively educational books and videos like "The
Real People's Guide to the Internet."
How well do you know your customer? Does he read Field & Stream or Hot Rod? Is she
into crossword puzzles or heavy metal? Where do they vacation? What's her day like?
Quick exercise: Write "personal bios" for your typical customers. Then drop your business
into their lives. Make it fit and make it sell

3. Find their problems

A good product is like aspirin.
Why? Because it helps the customer get rid of a headache. That's what marketing
consultant Raj Khera of Khera Communications Inc. tells his clients. In other words, great
marketing is about discovering your customers' problems and then solving them. "He
hates installation manuals"your on-screen prompts cure that. "She's not sure about
that lipstick shade"offer a money-back guarantee. "They need info fast"let them
reach you on the Web.
To discover and solve your customers' headaches, try offering free advice. Promote a
"complimentary design service" at your remodeling business. Offer a "party-planning
hotline" at your catering firm. Run a "reader's help desk" at your bookstore. Then sit
back, and let your customers tell you what they'll buy . . . and buy and buy.

4. Press the hot buttons

How did interactive game entrepreneur Gillian Bonner, 34, get her Los Angeles start-up,
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Black Dragon Inc., noticed by top players in her mostly-male industry? She posed for
Playboy. "I'll be your centerfold," she told Hefner, "if you'll market my firm." (Talk about
getting exposure!) But that's nothing new. When this former model, hardware/software
developer and Miss April 1996 meets with her design team to create cutting-edge CDROM/DVD fantasy adventures like the hot-selling "Riana Rouge," she asks one magic
question: "How will this product make our customers feel more attractive, hip or good
about themselves?"
It's about understanding "hot buttons"the basic motivations that drive customers'
buying decisions. And it's not just curvy playmates. Even if you're selling sump pumps,
this information is crucial to the sale. What are your customers' hot buttons? Buying fine
quality? Show that your handmade desks last a lifetime. Protecting their children?
Highlight that about your security system. Use the hot buttons to get hot sales.
5. Listen to them

Habla customer.
Thought Source's Colbin used to be a global sales rep, so she speaks more languages
than the UN. But her best linguistic feat is speaking her customer's language, focusing
on their needs and listening to their concerns.
Can you speak "customer"? Take this pop quiz:
My business goals come from:
a) my personal desires
b) market demand.
I sell products that
a) I like
b) my customers want.
Just "b" smart, and listen to your customer.
6. Get market intelligence Without it, your business is a collective idiot, trying to sell
refrigerators at the South Pole. Pour through your competitors' catalogs to spot what
you can do better. Become an "anthropologist" in the shopping mall, observing how,
when and why people buy. Peek into the future at your industry's trade shows.
Remember, the only person who can find a successful business entirely inside himself is
a sword-swallower. For the rest of us, marketing is an outside game. So get out, and
get smart.

7. MARKET FOR FREE.

Advertise your new business nationwide at no charge. Get paid to sell your services.
Sound impossible? Watch this. LaVan turned thoughtSource's training videos into live
seminars. Community groups pay the team to present their programs, and attendees
buy the packages. And Colbin and LaVan get free focus groups to beta-test their wares.
Can a class or demo boost your biz exposure? Or how about getting radio time, TV spots
and full-page newspaper spreadsall at no charge? Simple. Turn your business into
news. Make what you do interesting to the media. Find a trend and grab on. "Too many
kids are overweight"-our health club offers a K-12 program. "Buildings can make you
sick"-better call our cleaning service. "Latin music is hot"so why not sample our
authentic salsas? Want your business to get ahead? Then get a headline.
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8. Sell the benefits

Sell sizzle.
It's not the snowboard; it's the fun we'll have in Aspen. It's not the dress; it's how great
you'll look at the party. People don't buy products; they buy the positive anticipation of
using them. It's not the steakit's the sizzle.
Unfortunately, most start-ups try to sell features (such as durable construction or extra
insulation) when they should be selling benefits (it won't break; it keeps you warmer).
Khera uses this simple exercise with his clients to carve through the steak and release the
sizzle: Fold one sheet of paper. On the left, list every feature of your product (for instance,
surgical steel blades). On the right, turn every feature into a benefit (gives you a smooth
shave). Left side, "product." Right side, "marketing." Do the right thing. Sell the sizzle.

9. Get in their heads

"Psychographic experts" are people who get inside customers' heads to discover why they buy.
Their take? Every purchase is really about filling basic human needs, such as:
Success (that leather briefcase)
Excitement (premium sports channel with the latest "hardcore" activities)
Security (auto insurance)
Belonging (that "members only" jacket)
What are your customers' secret desires? How do they want to see themselves? Clean-cut?
High-tech? What makes them feel important? Beautiful things? The highest-quality products?
Good marketing is about tapping into those feelings. Right there in the aisle, show that
customer you'll make her kids smarter (your instructional software), keep his home warmer
(your fatwood kindling) or deliver their summer fun (your wet and wild pool toys). Make it
happen while they're reading the box. Take them where they want to go.

10. Sell sex

When thoughtSource premiered a book concerning sex called Society and the Net, it attracted a
media storm. Surprise! It was all praise, because Colbin and LaVan gave the topic a wholesome
twist: how to keep kids away from porn, Web sites for good relationships, Net facts about Viagra.
A positive storyand a PR goldmine.
On her Web-based forum, "Virtually Gillian," for Playboy's Digital Culture (www.playboy.com),
Bonner explores high-tech topics, from new operating systems to the Web revolution, and makes
them accessible and sexy. For Bonner, sex sells because it's really just a way of talking about
what's exciting and what makes people feel good about themselves. The moral? Every product
has a sexy sidefrom that dental floss bikini that says "Look at me!" to the baby-sitting service
that lets mom and dad finally spend some time together. Find the sexy side of your product,
because sex always sells.
That's 10 use-anywhere marketing strategies for your start-up success. And here's an easy
mnemonic to keep the whole game plan fresh in your mind. Just remember that marketing is the
business equivalent of putting on your underwear: It's what you need to do, first thing, every
day, in your new firm.

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3.2.

3 Rules for Niche Marketing

Follow these maxims to grow your business's audience.

Q: What should we know before our company goes after a niche market?
A: Most companies, whether big or small, direct their marketing to select niche audiences.
Even the country's largest manufacturers target carefully pinpointed market segments to
maximize the effectiveness of their programs and often tackle different niches for each
product group. Hewlett-Packard, for example, markets all-in-one machines that print, fax and
scan to segments of the home office market, while targeting larger businesses for higherpriced, single-function units.
Niche marketing can be extremely cost-effective. For instance, imagine you offer a product or
service that's just right for a select demographic or ethnic group in your area, such as
Hispanics or Asians. You could advertise on ethnic radio stations, which have considerably
lower rates than stations that program for broader audiences. So your marketing budget
would go a lot further, allowing you to advertise with greater frequency or to use a more
comprehensive media mix.
Taking on a new niche can be a low-risk way to grow your business, as long as you keep in
mind several important rules:
1. Meet their unique needs. The benefits you promise must have special appeal to the
market niche. What can you provide that's new and compelling? Identify the unique needs of
your potential audience, and look for ways to tailor your product or service to meet them.
Start by considering all the product or service variations you might offer. When it comes to
marketing soap, for example, not much has changed over the years. But suppose you were a
soap maker and you invented a new brand to gently remove chlorine from swimmers' hair.
You'd have something uniquely compelling to offer a niche market--from members of your
neighborhood pool to the Olympic swim team.
2. Say the right thing. When approaching a new market niche, it's imperative to speak their
language. In other words, you should understand the market's "hot buttons" and be prepared
to communicate with the target group as an understanding member--not an outsider. In
addition to launching a unique campaign for the new niche, you may need to alter other, more
basic elements, such as your company slogan if it translates poorly to another language, for
example.
In instances where taking on a new niche market is not impacted by a change in language or
customs, it's still vital to understand its members' key issues and how they prefer to
communicate with companies like yours. For example, suppose a business that markets
leather goods primarily to men through a Web site decides to target working women. Like
men, working women appreciate the convenience of shopping on the Web, but they expect
more content so that they can comprehensively evaluate the products and the company
behind them. To successfully increase sales from the new niche, the Web marketer would
need to change the way it communicates with them by expanding its site along with revising
its marketing message.
3. Always test-market. Before moving ahead, assess the direct competitors you'll find in the
new market niche and determine how you will position against them. For an overview, it's
best to conduct a competitive analysis by reviewing competitors' ads, brochures and Web
sites, looking for their key selling points, along with pricing, delivery and other service
characteristics.

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But what if there is no existing competition? Believe it or not, this isn't always a good sign.
True, it may mean that other companies haven't found the key to providing a product or
service this niche will want to buy. However, it's also possible that many companies have tried
and failed to penetrate this group. Always test-market carefully to gauge the market's
receptiveness to your product or service and message. And move cautiously to keep your
risks manageable.

4.

LEARN HOW TO CAPTURE THE BEST CUSTOMERS

4.1.

Who Are Your Clients?

Get to know potential customers with market research

Q: I need to reach potential clients for our environmental engineering consulting firm to learn about their
buying habits, styles, personality types and favorite ways of receiving advertising or communications. How
do you recommend I learn about them?
A: Telephone surveys are a terrific way to gather in-depth information on B2B prospect groups, as they
often have a higher completion rate than written surveys. It's best to rely on the services of a qualified
research company, though finding one with expertise in your field may take a bit of legwork.
Once you've selected a research firm, you should provide an outline of what you want to learn from your
survey and discuss the most logical order in which to present a total of about eight to 10 questions. It will
be the firm's job to design a 10-minute telephone survey that relies predominantly on closed-ended
questions (those that can be answered with yes or no or a multiple-choice answer) but also incorporates a
few open-ended questions that allow your prospects to answer in their own words. Focusing on closedended questions will make the survey results easier to analyze, particularly if you have a large survey
group. If you're looking for predominately qualitative information, you may need to talk with as few as 50
prospects, but if you want projectable data with a low margin of error, several hundred completed surveys
will be required.
Is your prospect base quite small? If so, you may choose not to hire a research firm and instead approach
this as a sales challenge. Design a call report (a form used to record the outcome of each sales contact)
that includes all your most important questions, and use it diligently when calling on your prospects by
phone or in person. This is the best way to build relationships while gathering the vital data you need

4.2.

Capture The Best Prospects

If youre trying to sell oranges, dont sell to people who like apples.

Q: I manufacture archery target backstops. One of my markets is archery clubs whose

members are 95 percent bow-hunters. The remaining percentage is made up of target
archers. There are some 5 million archers in North America.
I want to attract new people to the sport of archery, which will spur additional sales for
me as well as other manufacturers I'm affiliated with. My plan is to target the
nonhunting interests. What is the most effective means of drawing their attention?
Should I publish articles about archery in inexpensive, small weekly newspapers? How
about offering classes or going to special events where I would give people a chance to
shoot a bow? Am I on the right track?
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A: I'm absolutely delighted to answer this letter. You see, so many entrepreneurs make
this same mistake: Instead of focusing their efforts on the segment of the market
closest to making a purchase decision, they expend time and resources trying to
convert a vast group of people who have little or no interest in what they offer.
Major companies don't commit this error. Michelin Tires, for example, doesn't target its
marketing efforts on people who don't own cars hoping to convert them into car buyers
who will someday want to buy tires. That would put them too many steps away from
the buying customer. Instead, they market to people who own cars and are planning to
replace their tires. Likewise, you must market to folks who are actively involved in
archery and who want to replace/upgrade/purchase new target backstops. Leave the
promotion of the sport to associations and others who are directly responsible for
enticing new participants. If you truly feel committed to this aspect of the marketing
effort, perhaps you can join such a group and participate in its activities during your
spare time.
To build your business, focus all your marketing efforts in media that reach archers,
with the least amount of waste. That means using well-targeted print media for
advertising and public relations efforts, like placing print ads and submitting articles or
columns for publication that position you as an expert and your products as superior.
Explore the availability of good direct-mail lists of enthusiasts who participate in the
sport. You can probably rent subscriber lists from special-interest publications or
participate in their card decks. If you don't already have a terrific Web site, you should
set one up with links to major archery-related sites. Also, your idea to offer classes is a
good one, provided you target those who have already decided to participate in the
sport and want to improve. Just be sure that when you preach, you're preaching to the
choir.

4.3.

Attracting Referrals
Encourage your happy customers to spread the word about your
business.

Q: What can we do to win more referrals for our business? We see a lot of our competitors
getting customers this way, but we don't seem to have the same luck.
A: When it comes to winning referral business, luck plays a smaller role than you may
think. What matters most is cultivating current customers or clients and creating an
ongoing program to generate referrals from "influencers."
Learn
to
Ask
Your first step is to communicate with your customers to let them know you're open to
receiving referrals and what you're looking for. This may be done in person--when meeting
or speaking with them on the telephone--and it's best to be direct. Let's say you write a
newsletter for a division of a major corporation. When meeting with a department head
with whom you regularly work, you could ask her to refer you to other divisions within the
company that might benefit from copywriting services. If you have a good, solid working
relationship and a happy client, she may be willing to make introductions for you
throughout the company.
But sometimes this kind of direct request is difficult for entrepreneurs, and you may find
you're more comfortable using comment cards, surveys or other forms of written
communication with your customers to get referral names. A remodeling contractor, for
example, could send a follow-up letter at the end of each project asking for feedback and
include a section requesting referrals. Depending on your type of business, you may find it
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advantageous to offer an incentive to your current customers to provide referrals, such as
a discount or rebate, when their friends or family members make a purchase or sign up for
services.
Market
to
Influencers
Influencers are people who have direct contact with your primary prospects and can send
them your way. For instance, real estate sales associates are major influencers for home
inspectors, since many prospective homeowners rely on them to recommend an inspector
before they make an offer on a home. Likewise, home security companies that install
smoke detectors and other equipment often consider insurance agents major influencers,
as they frequently recommend installing such devices when reviewing new policies with
homeowners.
What types of businesses or individuals are major influencers for your company? There
may be thousands in your area--as in the case of a home inspector who relies on referrals
from real estate sales associates--or just a handful. Often, marketing to them can be as
important as the campaigns you use to reach your prospective customers or clients. That's
why it's essential to set up a program that includes a combination of sales contacts and
marketing tactics to keep referrals coming in year-round. Since referral relationships are
based on trust, it's vital to get to know your key influencers one-on-one. So you'll need to
identify them, then call and set up meetings to get acquainted.
Once these relationships are initiated, it's important to nurture and maintain them by
staying in contact by telephone, in person and through marketing tools such as direct mail,
e-mail or by fax. A great way help your influencers send business your way is to supply
them with marketing tools to use directly with your prospects. The home inspector, for
instance, could create a "10 Point Inspection Checklist" with his company's name and
contact information for real estate sales associates to use with prospective home buyers.
Set up a database with your referral list and schedule your ongoing activity in your contact
management program just as you would contacts with prospective clients or customers.
This will keep your program on track and important contacts from falling by the wayside.
The way you handle the referrals you receive will solidify your relationships with your
sources. So be sure to keep your influencers in the loop with thank-you notes or calls and
updates on the satisfaction of each referral they send your way. With a hard-working
referral program in place, you won't have to rely on luck to win the business your company
needs.

4.4.

Get your business in front of consumers the Seth Godin--author and

marketer extraordinaire--way.

Advertising and marketing are increasingly costly, yet decreasingly effective. Marketing guru
Jay Conrad Levinson says a consumer has to be exposed to an ad 27 times before it has the
desired effect. Only 10 percent of viewers remember TV ads the next day, even those
they've seen before (and never mind actually responding). Direct mail is considered
successful if it draws a 2 percent response. And the advent of a plethora of cable TV stations
and, of course, the Internet dilute the effect even further.
The problem is, we all suffer from an attention deficit, argues Seth Godin, marketing expert
and permission marketing director for leading Internet portal Yahoo!, in his latest book,
Permission Marketing: Turning Strangers into Friends and Friends into Customers (Simon &
Schuster).
Interruption marketing, designed to capture attention for a moment, doesn't work like it
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used to. Godin says the only way for a company to break through the message clutter is to
ask potential customers for permission to send carefully targeted messages--and give them
an incentive to pay attention.
Permission marketing, which promotes cooperative interaction between companies and
prospective clients, often produces astonishing results: It isn't unusual for 70 percent of an
audience to read some of the messages, while 35 percent actually respond (and you can
measure this precisely, unlike with most conventional advertising), says Godin.
But first you have to cultivate the potential customer, and ignore the attitude of interruption
marketing, which says "Buy now or go away," Godin warns. He calls permission marketers
farmers, while interrupters are hunters who go for the immediate kill. Agriculture wins bigtime in the long run.
Godin's many years in the business world helped him form his marketing strategy. In 1982,
he graduated from Tufts University in Medford, Massachusetts, with degrees in computer
science and philosophy, and received an MBA from Stanford University two years later. Wellprepared as personal computers became part of daily life, he became brand manager at
Spinnaker Software, where he led the team that developed the first multimedia products,
working with such forward-thinkers as Arthur C. Clarke and Michael Crichton.
In 1995, Godin founded Yoyodyne, the direct-marketing pioneer acquired last year by
Yahoo!. Along the way, he also wrote E-Marketing (Putnam), the first book about doing
business online; The Guerrilla Marketing Handbook (Houghton Mifflin); and The Information
Please Business Almanac (Houghton Mifflin), a ground-breaking reference book.
We recently discussed how to put "customize" into customer with the man Business Week
has dubbed "the ultimate entrepreneur of the Information Age."
Scott S. Smith: As a proponent of permission marketing, are you actually able to use it to
sell your latest book?
Seth Godin: After a long argument, the publishers agreed to put the first four chapters on
http://www.permission.com This asks a low level of permission: Would you like something
free? The key is to attach no strings. People avoid buying books because of a lack of time. I
call their bluff: Anyone can take a quick look at four chapters. In this case, they get it 45
seconds after asking. This beats a glowing review--they can judge for themselves whether
it's what they want.
The next question is, will they buy the book? I've had 24,000 hits on the site in the past
four weeks, and a huge number have clicked to buy it. Compare that with trying to sell a
book by taking out a $20,000 ad in The New York Times that hardly anyone sees. The same
principles can be applied to other products. Give people an incentive to contact you and
start a dialogue, then upsell with the permission they give you.
Every business has permission opportunities with customers. When you buy a burger, for
example, you're asked if you want fries. Or you're in a store and the clerk asks if you would
be interested in buying something on sale. You've already given them permission to sell you
something, and that can be leveraged. It's more cost-effective to increase sales to existing
customers than to run ads to find new ones, yet most businesses don't seem to appreciate
the value of what they have.
Smith: Why is that?
Godin: The business owner hasn't calculated the lifetime value of the customer. Figure out
what you think an average customer is worth in profit and what percentage of customers
you're able to turn into lifetime customers. That puts a value on dialogue--if a customer's
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lifetime value is $200 and if you convert one out of 10, you have $20 for every interaction.
You can easily evaluate your marketing program once you understand the real value of your
customers.
Smith: You offered free chapters of your book. What are other kinds of incentives to get
people to volunteer to be customers?
Godin: Don't start there; just be friends--give them something. It could be a video,
information, coupons, even a chance to simply offer an opinion. Of course, it should be
related to your business. For example, H&R Block ran a sweepstakes. The prize was that
they'd pay up to $25,000 of the winner's taxes. Fifty thousand people enrolled and went to
the firm's Web site to answer questions in a tax trivia game that took place twice a week for
10 weeks. [These consumers] were thinking about H&R Block all the time. You can't buy
that kind of attention with traditional advertising. The company created a dialogue about its
premium tax service.
Smith: What's the ideal type of permission?
Godin: The broadest is what I call intravenous. It's like you're in a coma and the doctor has
permission to give you whatever he thinks you need, and to bill you for it. Ideally, your
customers trust you to make decisions about their needs. You may have a similar
arrangement with the guy who delivers heating oil. In its heyday, the Book of the Month
Club had this level of permission. Internet companies are striving to get there.
Magazines don't look for readers for their articles; they create articles for their readers.
Successful entrepreneurs in the next century will find products for their customers, not
customers for their products. Know your customers and try to cover as many of their needs
as possible.
Smith: Like a good salesperson.
Godin: That actually falls under the category I call personal relationships. According to the
Guinness Book of World Records, Joe Girard is the best retail salesman in the world. In a
good year, he sells almost 20 times as many cars as the average salesperson. He does it by
sending a greeting card every month to each person he's met; everyone is willing to give
him their address for that. He uses that to remind them he's focused on them and is fun to
do business with. I have a financial consultant who has my permission to call me any time
because he's shown me he has good judgment. However, personal relationships are slow to
build and difficult to use to expand permission into new categories.
Cambridge Technology Partners [CTP], a high-tech consulting firm focused on e-business,
has a way of building relationships with its entire target audience by inviting the chief
information officers at leading companies to free seminars with major speakers. They don't
try to sell them anything at the time. But when the CTP representative calls, they've earned
a lot of attention.
Smith: In Permission Marketing, you mention the points-building program. Can you cite a
good example of this strategy?
Godin: This is hard for small companies to do, except in the form of, say, frequency
discount coupons, which are a much cheaper way of getting new customers than
advertising.
American Airlines was one of the earliest and most successful practitioners of permission
marketing with its frequent-flier program, AAdvantage. They have lots of opportunities to
gather information about their customers. They provide them with so many special offers
and affiliate promotions, customers look forward to getting their statement and monthly
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newsletter. They've leveraged the permission from being in the airline business to being in
the loyalty business.
Smith: That also sounds like what you call brand loyalty, which would seem to apply only
to big companies that can do national advertising.
Godin: Actually, you can build brand loyalty as an entrepreneur by using your uniqueness. I
shop at a two-store grocery chain because they've shown me I can trust them to deliver
good value with their house brand.
I'd also like to add something about sweepstakes, the essence of a points program. Even
wealthy individuals will go to great lengths to have a chance at winning something. What's
amazing is how [often] you enter a sweepstakes or send in a rebate slip, and the
information is thrown away by the company afterwards. They don't follow up with any kind
of contact. Large numbers of people have volunteered their addresses and shown an
interest in the company and are ignored!
Smith: But you need to have interruption advertising to get the initial attention of potential
customers, don't you?
Godin: Yes, but so much of it doesn't include a call for action, like an 800 number or a Web
site address. There should be an opportunity to start a relationship in every element of
marketing. You don't have to convert the audience to buying a product--you want them to
give you permission to give them something for free, to open the door, then build the suite
of messages to turn them from friends into customers, and then deepen the relationship.
It's easy to get people to volunteer; how to capitalize on that permission is where you
should put 90 percent of your focus.
Smith: How obvious do you have to make the request to start a long-term relationship with
customers?
Godin: You want to get a dialogue going, but you can't be subtle. The benefit has to be
obvious. You can't sell a mailing list of people who have given you permission to have this
relationship, or you burn it. You have to make it clear that your ability to talk to them is
strictly one-on-one. You want to build trust over time so you can expand your offerings as
you get to know each other.
Smith: Does permission marketing work best with the Web because people can easily
respond to its invitation?
Godin: You can use this anywhere, but it's really the only way to make money on the
Internet. That's what the best Web sites are building toward, permission to sell a broad
spectrum of products and services in the future, after the relationship has grown. They
understand that the immediate sale is not important. Unfortunately, most of the 2 million
corporate Web sites are poorly designed even to convey information. Visitors want to know
immediately where to click, yet this isn't the case. Five years ago at Yahoo!, we realized
how to do it right. Quit trying to make it cool and miraculous! Sites should be small, fast
and simple--too many sites make smart people feel stupid.
Sites should collect e-mail addresses with the promise of a benefit. The Net isn't TV--it's a
trade show with 37 million booths, and you want a card from each of them. You don't want
comets that show up once; you want satellites that will keep coming back.

4.5.

Fishing For Customers

Reel in clients with these helpful marketing tips.
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Q: We have a small fishing charter business in southeastern Alaska and are looking for ways
to find new clients. We've thought about trying to find an agent who would sell our charters
for a commission, but we don't know where to start. We get inquiries through our Web site,
but we need other ways to get our business out there. Any ideas?
A: Whether you own one of a hundred dive-and-snorkel charter businesses in Key West,
Florida, or a charter fishing boat in southeastern Alaska, your principal challenge is to
differentiate your business from the competition and create a unique sales and marketing
proposition that makes tourists want to sail off into the sunset with you. Since your charter
business is particularly remote and tourists must take two planes (Alaska Airlines from
Seattle and then a smaller plane) just to reach you, your story must be extremely
compelling. You must also selectively target potential visitors who are predisposed to your
message using media that reach out to them when they're most receptive.
What makes choosing your fishing charter a unique, not-to-be-missed experience? And why
should fishing enthusiasts book with you vs. a sea of competitors? Take a long, hard look at
what you have to offer, and create a list of unique benefits that incorporate the mystique of
your remote and beautiful wilderness area and the bounty of fish to be had, along with your
own compelling story. Weave these unique benefits into a print advertising campaign in
publications targeting visitors to your part of the state. Research outdoor- and fishing-related
magazines that offer regional advertising rates using tools on the Web, including
www.publist.com. Also contact major newspapers in feeder cities, such as Seattle, for
advertising opportunities in related travel or sport fishing editorial sections.
Make your company's Web site more compelling by using your unique sales and marketing
proposition to make a stronger case for your charter business. Put listings on all related
Alaska sites that focus on fishing and outdoor vacations. And participate in discussion lists on
the Web that draw fishing enthusiasts using a signature line that includes your Web address
and a brief benefit statement.

4.6.

Making Impressions That Count

How to leave clients and other contacts with smiles on their faces.

Janet McNaughton considers thank-you notes to be more than a courtesy--they're a

necessity. Founder of Lasting Impressions, a gift company in Kirkland, Washington,
McNaughton says writing thank-you notes to clients and customers is just one of the
ways she markets her company--she even counsels her clients on how to create good
impressions with their contacts.
We know what you're thinking--the last time you set pen to paper in gratitude, you were
thanking Aunt Eunice for the, er, interesting (though slightly garish) candlesticks she sent
as your graduation gift. But if you want to succeed in your customer relationships, a little
expression of gratitude can go a long way. It certainly did for McNaughton, 36. "I started
my business just dedicating myself to the fundamentals," she says. "I believe the
fundamentals are writing thank-you notes, investing in the people you want to do
business with, and providing outstanding products and services at a fair price."
When she set up shop in 1996, McNaughton committed herself to writing about five
thank-you notes per day, to clients, customers and anyone who had done something
good for her company. "It was just a habit," she says.
A habit that paid off. McNaughton's note of gratitude left such a positive impression with
one of her clients--a buyer for retailer Sam's Club--that the buyer recommended Lasting
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Impressions to another client. "Because of that key introduction, I was able to establish a
fabulous partnership."
So we've got the thank-you part covered. How else can you make a good impression on
clients and customers? McNaughton's system includes a database with all her contacts,
whom she rates from A to D. A people refer business to her. B's are people she could
train and convert to A people. C's are people she has just met and cannot yet qualify,
and D's are people with whom she most likely won't be doing business. She routinely
sends small gifts and thank-you notes to her A people--to thank them for their referrals
and building her business. "If you're an A person, you get something from me every
month," she says. "And these things don't cost me that much."
Be it a small Valentine gift that says "You're The Heart Of My Business" or a phone call
that lets them know she appreciates their help, McNaughton has built a core group of
contacts so enthusiastic about Lasting Impressions, they can hardly contain it. "These
people are like walking, talking billboards for me," she says. "Everywhere they go,
everyone they run into--they're like: 'Oh my goodness! Have you met Janet
McNaughton? Have you used her services?' "
That kind of devotion is what McNaughton hopes to give to her clients as they build
relationships with their constituencies. She helps them create a similar system on a
monthly plan. Her key is plotting into their calendars when to send out thank-you notes,
when to send Fourth-of-July-inspired red-white-and-blue cookies and when to make
follow-up courtesy phone calls. "The fundamentals take a lot of self-discipline to
[accomplish]. You really have to buckle yourself in and make those phone calls," says
McNaughton, who is expecting a sales increase of about 50 percent for 2002. "And I
found most recently, especially with the economy being how it is, people are incredibly
receptive to the phone callsI have been so encouraged."

4.7.

Want to turn up the heat on your marketing campaign? Start by turning

cold contacts into hot prospects.

Remember when you bought your last car? You probably didn't make the decision
overnight. First, you started paying more attention to car commercials and ads, and
then you looked at a few different models. Perhaps you did some research on the
Internet and visited dealerships to check prices. When you were ready to buy, you
completed the sale.
Your own business prospects move through the buying cycle in much the same way.
At first, they know virtually nothing about your company, but over time, they become
familiar with the benefits of your product or serviceand eventually, they're ready to
buy.
Every business owner needs a marketing program that involves customers from when
they first start "kicking the tires" to when they offer their closing handshakes. And for
most businesses, the sales cycle requires eight or more contacts with a prospect
before a sale is closed. So to create a successful program, your sales cycle must be
supported by continuous marketing efforts that reach out to prospects in three
stages: cold, warm and hot.
Cold prospects: These are either members of your particular target audience or
companies you have placed on a list of prospects who know nothing about you.
Warm prospects: These most likely make up the bulk of the prospects that are in
your company database. They are businesses or individuals who've been exposed to
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your marketing message but aren't completely ready to close.
Hot prospects: These are the prospects you've successfully moved through your
sales cyclecultivating them through multiple marketing contacts and sales efforts
or who have come to you as referrals with an expressed need for what your company
offers. Personal selling in some form, whether face-to-face, on the phone or even via
e-mail, is often all that's necessary to add the final heat to close the deal.
Feel The Heat

Marketing tactics also come in various temperatures, too, and you should use a
range of them to draw prospects in and move them closer to a buying decision. An
integrated marketing approach draws upon a variety of media and tactics to convey
one central message or branding theme. But avoid adopting just a single tactic
such as relying solely on direct mail to warm prospects or exclusively on PR to
reach cold oneswhile completely neglecting the tactics that have the po-tential to
motivate prospects who are in other stages of your sales cycle. Combine your
marketing program with some kind of interpersonal interaction, such as one-onone sales contacts, for a well-rounded approach.
Case in point: Lets say your company manufactures hand-dipped chocolates that
you sell wholesale to gift and gourmet stores and via retail on your company Web
site. To reach cold prospects, you participate in gift and fancy food trade shows,
where the theme of your booth is carried through into all your marketing handouts
as well as the advertising in the show programs. An ongoing ad campaign in the
trade magazines that reach your audience carries the same message. Following the
shows, your staff makes warm calls to follow up all the leads gathered. The
names of your warm prospects are added to your database, and those retailers
receive catalogs by mail followed by mailings about every six weeks that continue
to move them through the sales cycle. To turn warm prospects into hot ones and
close sales, you send broadcast faxes with special pricing and promotions to create
immediacy, and your staff follows up the faxes with telephone calls to close. Hot
retail prospects whove purchased from your Web site receive special reminders via
e-mail of birthdays or upcoming occasions to stimulate repeat sales.
Do you have a well-rounded marketing program like the one described above? To
turn up the heat and increase the year-round success of your growing business, set
up an ongoing integrated marketing program that does an effective job of reaching
out to cold, warm and hot prospects. And dont be afraid to mix it up a little bit
choose from advertising, PR, direct mail, special promotions, broadcast faxes and
Web marketing. Combined with your companys ongoing sales efforts, youre sure
to find the winning formula thats right for your business.

4.8.

Converting Prospects to Your Way of Thinking

When prospects understand your business, they're more likely to
becoming paying customers.

Q: I've just completed a yearlong advertising campaign designed to increase my

business' sales volume. Although my sales have increased somewhat, I must admit
I'm rather disappointed in the overall results. I had expected a much larger impact
on sales. What can I do to improve the results of future advertising efforts?
A: Some of the most difficult things to access are the root causes for the failure of
an advertising effort to produce the results we originally expected. Sometimes when
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our advertising falls short, it's because our expectations were too high to begin with.
Other times, poor results are caused by systemic weaknesses in, and/or the
misdirection of, the specific advertising campaign itself. Or perhaps you tried to
market to potential customers--but they didn't share the same view of your business
and its products and services that you do. When this happens, your potential
customers may respond better to "conversion marketing."
Traditional marketing efforts typically focus on attempting to make a sale. In this
scenario, a business's products and services are introduced to potential customers
by telling them how great the products and services are, as well as the benefits of
doing business with this particular company. Conversion marketing takes a
completely different approach.
Rather that constantly attempting to drive increased sales as the first order of
business, you may be better served by implementing the precepts of conversion
marketing. Your business's marketing efforts can then be focused on the process of
converting potential customers to your business's way of thinking. Once potentials
customers think like you do, they are much more likely to listen to, believe and take
action based on messages your advertising is delivering. You will also have paved
the way for your business's future marketing efforts.
In order to successfully integrate conversion marketing, you must communicate
what your business is really about to your potential customer base. In this manner,
you allow them to see behind your business's entity, products and services and
identify reasons why they should patronize your business.
The following examples illustrate three businesses that have successfully engaged in
conversion marketing:

The accounting firm that goes beyond advertising that they're CPAs who do
accounting and tax work. Instead, they communicate that they're sincerely
interested in helping small businesses become more successful by consulting
with their owners. Once potential customers understand of this new way of
thinking about accounting services, they'll be much more receptive to this
accounting firm's specific marketing efforts.
The retail shop that specializes in products that facilitate the enjoyment of
wild birds. In this example, the owner implements conversion marketing by
introducing the shop's potential customers to the joys of wild birding. Next,
the owner personally takes potential and existing customers on regularly
scheduled bird-watching walks, where the numerous benefits of birdwatching are demonstrated and enjoyed. Also, the shop distributes a monthly
informational newsletter to members of the business's target market, which
helps to educate this potential customer base. Once these potential
customers become wild bird enthusiasts, the business's marketing becomes
much more effective.
The Web site that provides medical information and advice to site visitors.
Once site visitors discover that it's possible to receive very specific medical
information and advice, they will have been converted into Internet users
who have confidence in the ability of this Web site to provide highly technical
information in a useful format that they can easily access anytime they have
medical questions. Once converted, they will return to the site again and
again, and will then be more receptive to any marketing that is also included
on the medical Web site.

Once you've successfully implemented a permanent conversion marketing presence

into your marketing efforts, you'll find potential customers to be much more
receptive. And before long, you'll be enjoying significant growth in sales.
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4.9.

Building Customer Relationships

Increase your sales through better relationships with your existing
customers.

Q: I've been debating with my marketing advisors for some time the implications
and importance of relationship marketing on a marketing strategy. Do you think that
relationship marketing represents a new paradigm and should replace the marketing
mix paradigm? Or is it just a fresher concept of the traditional marketing mix way of
dealing with things?
A: Our lives are generally organized around long-term relationshipsa favorite dry
cleaner, hair stylist and family doctor come to mind. It's easier to stay with the
companies and products we're used to, and as consumers, we respond well to
communications programs that build loyalty and earn our trust. So a successful
marketing strategy should include an integrated marketing campaign that builds
trust with prospects through the selling process and maintains customer service
relationships with them long after the initial sale.
A relatively new term for an old concept, relationship marketing (or customer
relationship management, CRM) formalizes the process of identifying your best
customers and, through communication and rewards, builds a relationship with them
that increases their lifetime value. It doesn't replace prospecting tactics, including
advertising, in the marketing mix. It's about using today's high-tech tools and an
ongoing communications program to enhance your return on investment in
marketing to existing customers.
To start out, you'll need a solid databasethe essential tool to begin a CRM
program. You can use top-selling software such as GoldMine 5.0 from FrontRange
Solutions Inc. or ACT! 2000 5.0 from Symantec Corp., both priced at about $180.
These easy-to-implement programs give you and your staff shared access to
customer and prospect information; let you log in calls, meetings, to-do lists, letters,
faxes and e-mails; perform mail merges; schedule the steps in your marketing
strategies; and evaluate the results of your marketing programs. You can also
perform the same tasks anytime, anywhere using one of the new online subscription
CRM services such as Salesforce.com, which is priced at $50 per month for your first
five users.
Once your contact management program or subscription service is in place, segment
your database and identify your best customers. Then design a program that
includes special services, offers and communications designed to build loyalty.
Newsletters, direct mail, e-mail and fax-back programs are excellent ways of
maintaining communication with customers via marketing tools. But don't forget
one-on-one contact by phone and in person. By integrating sales and marketing in
this way, you'll improve customer retention and increase your company's revenue.

4.10.

Automate
Customer
Relationships
With
CRM
Software
Stay focused on the most important component of your business--your
customers--with CRM software.

Do you know your customers? Probably not as well as you think. Customer relationship
management, or CRM, helps focus your business on the folks that butter your bread.
Part mantra, part software - CRM includes a wide range of tools designed to understand and
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serve both prospective and existing customers more effectively. At first glance, this may seem
like an additional unnecessary expense with little return. However, taking a customer-centered
focus should be able to boost your revenues, lower your overall expenses, or achieve both
goals.
CRM applications can be grouped into a few large buckets. Sales force automation tools help
track your pool of prospects as they move from interested leads to paying customers. This
includes software that forwards incoming leads and tracks interactions with prospects. Armed
with such information, you can better forecast your expected revenue, understand your sales
cycle, and evaluate the effectiveness of your salespeople.
Customer support automation improves the process of handling customers so you can better
satisfy them while minimizing your costs. Whether you support your customers through a call
center, in-person, or online, a wide variety of applications exist. They range from live online
help, searchable knowledge bases to look up answers to previously asked questions, and case
tracking to ensure no inquiry gets lost.
Finally, marketing automation tools help track the effectiveness of your various advertising or
marketing efforts. These tools track the expenses from activities like trade shows, mailings, and
advertising and compares them to the sales that were generated and attributable to these
efforts. While it may be a less than perfect measure in some cases, trying to determine the
return on investment for these efforts is a terrific discipline that can only improve any company.
The good news is that CRM has finally come downstream with vendors offering packages
designed for small businesses. However, make sure to take the time to evaluate whether the
software is truly built to size or simply a large suit cut small. To ensure the best fit, look for CRM
that specializes in the need you want addressed.
CRM products can still be pricey though. Do not be surprised to see price tags in the $3,000 to
$5,000 range. Prices can easily escalate into the tens of thousands of dollars and even higher
for more complex implementations.
To make it easier on the budget and for companies without in-house technical support, hosted
CRM applications do exist. Pricing ranges from $50 to $150 per month per user. If you are
testing the CRM waters for the first time, this can be a great way to cut your teeth without
having to invest the months it can take to get a system actually integrated into your system.
In a world where fewer and fewer customer interactions actually take place in person,
implementing CRM technology can be an excellent way to provide a more personalized touch
when working with your customers.

5.

LEARN HOW TO CREATE AN EMAIL MARKETING CAMPAIGN

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5.1.

How to Create an e-Mail Marketing Campaign. At a fraction of the cost of

direct mail, e-mail marketing is one of the best ways to reach your best
prospects

Q: What does it cost to rent a targeted e-mail list, and what are the typical response
rates?
A: E-mail marketing may be taking the place of traditional direct mail as more
entrepreneurs find they can save money, get quicker responses and increase their
overall response rates with e-mail. It can take a month or two to execute a directmail effort, but an e-mail campaign can be completed from concept to mailing in
under two weeks. And while typical response rates for direct mail and e-mail are both
about 1 percent, permission-based e-mails (those using opt-in lists) fare much better.
The average click-through rate on mailings to opt-in lists is between 6 and 8 percent,
according to the research and advisory firm Gartner G2.
Marketing via e-mail is also considerably less expensive than going postal. The cost to
rent an opt-in list will range from under $100 to about $350 per thousand. And
because it eliminates printing, postage and other costs, e-mail marketing is one of
the most affordable ways to reach targeted groups of prospects.
Here are some helpful tips to guide you through the four stages of e-mail list rental:
1. Find the right lists. With your specific target audience in mind, begin with
Web searches on "e-mail list management" or "e-mail list brokers." List
management companies, such as www.edithroman.com, offer opt-in e-mail
lists from a wide range of vendors, while brokers will make recommendations
regarding the best lists to meet your needs and execute the buys for you. If
you need very small quantities of e-mail addresses in a variety of categories,
you may want to assemble your own consumer or B2B lists with the help of
sites such as www.postmasterdirect.com.
2. Make your selection. When evaluating a specific list, ask the sales rep for
the data card. That's a single sheet describing the list and its source,
selections available, counts for categories, costs and rules concerning list use.
Then begin asking questions. It's important to know how the list was
assembled. E-mail lists of individuals who have purchased a product like yours
or subscribe to a certain publication typically outperform lists that are simply
compiled from directories, for example. Also, find out how recently the list has
been cleaned and who else has been using it. It may be helpful to know
whether one of your chief competitors has recently mailed to the same list.
3. Submit your creative. Most list vendors will require approval of your creative
content prior to final purchase. This helps ensure that the content is consistent
with the information their list members have agreed to receive and filters out
any objectionable material. During this approval stage, you should also secure
a transmission date.
4. Finalize the layout. Once your payment has been received, the list vendor
will take your text word processing file and put it into an e-mail format. Bear
in mind, your mailing will look different in various e-mail programs. So prior to
your mailing, be certain to send a test e-mail to select addresses to make sure
the layout is what you expect it to be.
And here is a final important tip: To evaluate your response rate efficiently, request
tracking services from your e-mail list manager. They'll monitor click-throughs by
redirecting your hyperlinks through their server and back to you. That way you'll
always have reliable information on the results of your e-mail efforts.
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5.2.

10 Ways to Improve Your e-Marketing

Get the highest return on your marketing investment using these
strategies.

Q: I do a great deal of marketing for my products on the Internet. While I have had moderate
success, I would like to increase my effectiveness. Do you have any suggestions?
A: Most people seem to approach marketing on the Web as if it were some type of daunting
undertaking. They tend to forget basic marketing fundamentals, especially when it comes to
promoting a desired action. However, the Web is not some imposing technological behemoth,
but rather a new form of media. Like other forms of media, it does have its own unique
elements, but you can produce effective results through some basic tenants called ROI
marketing.
The basic principle of ROI marketing is to create efficiencies between the first point of contact
or promotion and the desired result. For instance, if you want to produce some type of
transaction, why have the potential customer wade through screen after screen of copy? Take
them directly to a page where they can get basic information but also have the opportunity to
complete the transaction.
If done properly, ROI marketing can take a poorly performing campaign and increase its
effectiveness tenfold. Here are 10 tips to help you get started using ROI marketing:
1. Use short, catchy headlines. Don't get too creative or esoteric. Make sure your
selling points are the primary focus.
2. Include a strong call to action. If you are offering 10 percent off, highlight that and
use bold typeface to draw attention to the offer.
3. Adjust the creative to the audience you are trying to influence. Don't try selling
$50,000 servers to a company of five employees.
4. Keep your message and creative focused. If you're selling travel specials, don't
focus on the functionality of your site; concentrate on offers you want to sell.
5. Use different touchpoints on the page to reinforce the overall message. On
your own site, run promotions at the top, middle and bottom of your pages. On sites
where you are marketing, see if you can buy takeovers during specific times of the day
where your creative will dominate a particular page.
6. Make the desired action clearly visible. Don't underplay the action. If you want
someone to click, tell them where.
7. Take them where they need to be. Once you have captured a potential customer's
attention and they have clicked through to your site, don't bury the transaction event
five screens away from the entry point. Give the potential customer the opportunity to
complete the transaction immediately. In fact, if you can carry the transaction within
the initial promotional message, take advantage of that opportunity.
8. Keep it simple. Once you have the prospect's attention, don't make him or her wade
paragraph after paragraph of copy. Get to the point immediately, and offer them
additional opportunities for information if they desire it.
9. Show the product. If the product is worthwhile, it's worth showing. A picture is worth
a thousand words.
10. To create a transaction, you have to create trust. Keep a link to your privacy
statement in clear view. Make sure customers know the transaction is secure. Place the
security certificate emblem in clear view. Do everything you can to build that feeling of
trust with the prospect. It may mean the difference between one transaction and 10.
Make your marketing work for you. Whether you are placing campaigns on other sites or using
search engines to drive the bulk of your traffic, make that investment in time, money and
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energy really count.

5.3.

Start The Presses

Making the most of newsletters.

Newsletters can be wonderful tools for communicating with your customers, employees
and other key audiences. Because of their format, they're often infused with more
credibility than traditional brochures. If your newsletter is little more than blatant selfpromotion, however, it's likely to hit the wastebasket before it hits your target's desk.
By following a few basic tips, you can cultivate interest in your newsletter and make it
an effective marketing tool.
Keep it interesting. Whether you're informing prospects or encouraging teambuilding among your employees, provide useful content and avoid the temptation to
use a hard-sell approach. For example, if you own a home-decorating supply store,
include "how-to" articles on faux-finishing and wallpapering featuring products that you
carry in your store. While these topics relate to your field and reinforce your message,
they also offer valuable advice and will help cultivate a loyal audience.
Do it yourself . . . or not. The abundance of desktop publishing programs on the
market makes it easy for virtually anyone to create a newsletter. However, poor
knowledge of design basics and overzealous use of difficult-to-read fonts has led to
more than one design disaster. Before you try to do it yourself, consider hiring a
professional graphic designer to create a template into which you or a staff member
can input copy. If you still want to give it a shot yourself, pick up a book on graphic
design basics before you create your masterpiece.
Find your look. Depending on your budget, you can choose from a variety of
styles--from a simple, one-color piece to a multipage, full-color format. Factors such as
the number of colors and pages, type of paper, and paper size can mean big
differences in cost, so ask for quotations on different specifications from several
printers.
Keep it short. Generally, it's best to limit your newsletter to eight pages or fewer
and keep articles at 300 words or fewer. If you have a lengthy or complex issue to
address, try to break it up into two articles or one longer article accompanied by a
short sidebar piece.
Remember what a picture's worth. Photographs add interesting elements to your
piece--as long as you use something more creative than the traditional "smiling head"
shots. If you choose not to use a full-color format, keep in mind that photographs
reproduce best in shades of black. Learn from one unhappy marketing manager whose
two-color newsletter featured the company president's face printed in a very
unflattering shade of green.
Don't ignore the details. Triple-check spelling and grammar. Typographical errors
can quickly damage your credibility and distract your reader. In addition to running the
document through spelling and grammar checkers, have someone proofread it-preferably someone who hasn't seen the article before. He or she will be more likely
than you are to catch any errors.
Include a feedback mechanism. Make it easy for readers to respond by including a
contact name, phone and fax numbers, and postal and e-mail addresses
Cost Cutters

Looking for ways to cut your newsletter costs? Here are a few tips:
Team up with another business that reaches out to similar prospects. Split the
content--and the cost--of the newsletter.
Run your rough design by your local post office. Sometimes, simple size changes
can cut postage costs.
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Get prices from at least three printers, and let them know you're soliciting
multiple bids for the job. Competition can help you get a better price.
Offer an e-mail option. This allows you to save on postage and printing, but send
it only if customers ask. New laws are cracking down on unsolicited e-mail.

5.4.

They've Got Mail

Want to power up your marketing plan? It's cheaper than you think.
Send your business to the next level (and save some trees).

Are you ready to increase awareness of your business, enhance your company image and boost
your sales--all without breaking the bank? Try adding an e-mail newsletter to your marketing mix.
An e-mail newsletter is a document you put together yourself and distribute via e-mail, usually free
of charge. E-mail newsletters are either text-based (without art, photos or fonts) or HTML-based,
which requires a more complex design process.
Gary K. Foote's two-person Webbers Communications, a Web site development agency in North
Conway, New Hampshire, has grown substantially as a result of its e-mail newsletter, The EMarketing Digest. "When we began e-mail publishing," says Foote, "our business customer base
came 90 percent from offline contacts and 10 percent from online contacts. Today it's more like 30
percent offline and 70 percent online."
Any business whose customers regularly use e-mail can benefit from this marketing method, says
Leslie Speidel, a marketing coach in Raleigh, North Carolina, who has launched four e-mail
newsletters.
You don't need to be a tech or writing whiz to publish an e-mail newsletter, but you do need energy,
motivation and dedication. While e-mail publishing requires some time on your part, the result is
worth the effort. Consider the following investments you must make:

Time to research the technology you'll need

Time to write content or find writers
Creativity to come up with fresh, useful content
Time to maintain subscriber files
Time to read and answer mail

Producing your newsletter should take from two to six hours per issue, depending on the length
and how much you write yourself. Also, plan to devote about two to four hours the first time to
setting up a template. Finally, expect to spend about five hours per week marketing your
newsletter. The following steps will maximize results:
Step 1
Write a mission statement. Before her clients launch e-mail newsletters, Pullman, Washington,
public relations consultant Cynthia Freyer has them "determine what competition exists, create a
mission statement and determine how they'll evaluate the newsletter's success."
To develop your mission statement, decide what information would help your typical customer
make purchasing decisions. Put this in a three-line summary. Remember, your newsletter isn't
about your business, it's about your customers. A sample mission statement includes:
For a travel agency: "Our newsletter covers issues of interest to the business traveler. Sections
in each issue include tips to make travel easier, a humorous Top 10 list and a profile of a major
metropolitan area." A sample article: "Atlanta's Best Breweries . . . Where to `Head' After the
Convention." Your mission statement guides editorial content. Keep it in mind when putting
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together articles for each issue.
Step 2
Tell the world. There are several places online to announce your new publication:
Other newsletters and Web sites: Search newsletter directories and the Web to find examples
of other e-mail newsletters. If they're complementary (not competing), write the editors and ask
if they want to offer your newsletter to their readers.
Step 3
Start writing. You can do the writing yourself or outsource it to a professional freelance writer.
This costs $150 and up per article, but it saves time and can mean better writing. Or try moneysaving options:
Ask authors of previously printed material for permission to reprint their work.
Ask vendors of complementary products or services to write articles about their
businesses.
Ask customers to write articles about how they've successfully used your product or
service.
Design a standard template to use for each issue. Start with a header that includes your
newsletter name and your business name (for example, "Gorgeous Gardens, published by
Silver's Landscaping Service"). Follow with your name and contact information.
Present a consistent format to your readers in each issue so they know what to expect.
Think about how your favorite magazine includes the same regular columns each month.
Dividing your newsletter into regular sections also makes writing easier. Sections to
consider: "Expert Tips" (perhaps written by a vendor), "Success Stories" (telling how a
customer used your product or service) or "How To" (explaining a useful skill).
If you distribute your newsletter weekly, include no more than five sections with three or
fewer paragraphs each. If you're distributing less often, you can double or triple that
length. Online newsletters can be delivered as often as every day or as infrequently as
once a month. Plan yours according to how much time you have to spend. Include a
copyright notice indicating that because you own the publication it may be forwarded only
in its entirety. Also include a privacy statement promising you'll keep subscribers' e-mail
addresses private.

Step 4
Plan your distribution. Because your newsletter will be a plain ASCII-text document, follow
these formatting rules to ensure the line breaks are even:
1. Put a hard return at the end of each line; each line should be 65 characters or less.
2. Use special characters (such as plus signs and asterisks) to divide between paragraphs.
Subscribe to other e-mail newsletters before designing yours to see how they are laid out.
3. Carefully proofread your newsletter, and do a spelling check and a grammar check.
There are three ways to distribute your newsletter: with a basic e-mail program, a Web-based
distribution program or custom list software.
Beginners can use a basic e-mail program such as Eudora Light or Pegasus Mail, both available for
free on the Internet. Maintain a file with all your subscribers' e-mail addresses in it; to send the
newsletter to your list, paste the file in the `bcc' (blind carbon copy) field of the message. (If you
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paste it in the `To' field, recipients will see a long list of e-mail addresses.)
A Web-based distribution program, such as those offered by Listhost, Revnet or Oaknet Publishing,
uses a Web interface to distribute your list, either for free or for a fee. The distributor maintains
your subscriber list and handles requests for new subscriptions. When you're ready to distribute,
simply paste the content into a Web-based form and press a button. You won't need to consider
custom list software, such as LISTSERV, until your list exceeds a few thousand names.
Step 5
Keep marketing. The best way to promote your newsletter without blatantly advertising is to
become active on discussion lists and newsgroups.
Discussion lists: Messages are sent to readers via e-mail. The content isn't written by the
editor or publisher; instead, readers send an e-mail (a `post') to the entire subscriber base.
Most discussion lists have rules about what's appropriate to contribute.
Chat rooms: Commercial services such as AOL and CompuServe offer chat rooms, which
allow for real-time online discussions.
With all three groups, your goal is to present your expertise by offering suggestions and asking
informed questions. Create a signature file you attach to each e-mail, briefly explaining what your
e-mail newsletter offers and how to subscribe. Each time you post in these groups, your signature
file subtly promotes your publication.
Make sure online promotion is a continuing priority in your business, says Freyer. Think of your email newsletter as a handful of seeds you plant with every issue. Eventually, the seeds will grow,
and you'll reap more sales than you thought possible.

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6.

EXTREMELY IMPORTANT HOW-Tos!

6.1.

How to market your product on television

Q: I'm in the process of making a product, and I'd like to market it on television much
like they marketed the famous Ginsu Knives. I'm not looking to do an infomercial. I
think it might give too much of my product away for free. Where and how can I locate
these marketing companies?
A: Direct-response television today, which includes everything from short, 30-second
direct-response shots to infomercials that run several minutes or the length of an
entire program, is a far cry from the days when products like Ginsu Knives captured
the imagination of TV viewers nationwide. Back then most people could view only
about eight TV channels, while now we have hundreds to choose from. Also, some
media rates have risen as much as 500 percent in the past five or six years, making
the cost to run a successful infomercial $150,000 to $500,000 a week. And you can't
cut costs by running your direct-response spots on a small local station. The response
rate would be too low to cover the production costs and the 10 to 20 percent product
return rate that's common in the infomercial business.
Depending on the type of product you've created, why not consider marketing it on
QVC or the Home Shopping Network to reduce your risks and marketing costs? These
networks buy your product at 40 to 50 percent off the retail price, test it and then sell
it, so your principal out-of-pocket cost is for inventory.
Another alternative is to opt for the newest form of direct-response marketing that
makes use of VHS tapes or CD-ROMs with full-motion video. In place of a product
catalog or brochure, you could mail a VHS tape to a highly qualified list, like Mercedes
Benz did for its new E-class cars. The response rates are higher-as much as 60
percent, according to Dworman-the videos are cheaper than many printed catalogs,
and recipients tend to keep videos because they have an intrinsic value.
If your budget does permit forging ahead with direct-response television, it's best to
hire an advertising agency to produce and place your spot. Production costs range
from $150,000 to $600,000 for infomercials of two minutes or more, and $50,000 to
$75,000 and up for a typical 30-second spot. But anything less than two minutes may
not be enough to sell your product on television, according to Steven Dworman,
publisher of the Infomercial Marketing Report newsletter, who says an advertiser must
leave a toll-free number on the screen for 40 seconds in order for it to be effective.
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6.2.

How To Price Your Product Or Service

This three-step process will help you decide.

Q: Im starting a wedding planning business, and Im wondering how much I should charge. How
do I price my services?
A: Unfortunately, theres no easy answer to your question. Every business owner must arrive at
his or her own pricing structure. The good news is, the information you need is readily available
you just have to do your homework. Ultimately, your rates will depend on three things: your
actual costs plus a reasonable profit margin, the pricing the market will bear and the ways youll
add value to your service offering.
Start by itemizing the cost of a typical job, including a markup on any subcontracted products or
services. Consult your industrys national association for rate guidelines, and contact a range of
potential vendors to learn what it will cost to purchase their goods and services. Then add
overhead items to your pricing, such as the costs for your rent and marketing materials, plus a
sufficient profit margin to grow your business.
Your next step is to review your local competitors marketing materials, including their brochures,
ads, direct mail pieces and Web sites. If their rates are unpublished, you may have to mysteryshop them by speaking with their sales staffs. Youll undoubtedly note similarities in their pricing
structures. This will give you invaluable insight into the rates the local market will bear.
After surveying your competitors rates, you may be tempted to price your services lower, thinking
youll gain a competitive advantage. This would be a mistake, as prospective clients are more
likely to base their buying decisions on value than price when choosing between similar services.
Decide how youll add value by offering special features that clients will find worth paying a bit
extra to obtain.
Finalize your pricing based on your fixed costs, what youve learned about your competitors
pricing and the ways you plan to add value to your service offering. That will give you just the
right solution to your pricing dilemma.

6.3.

How to Remove Sales Barriers

Overcome rejection and transform prospects into customers.

Q: My problem is not generating leads, but converting those prospects to customers. It seems
we're getting lots of people in, but only a small percentage become clients. Can you help me
figure out what's standing in the way of sales?
A: A low conversion ratefrom leads to salesis a common sales and marketing problem
many businesses face. First, I suggest reviewing and fine-tuning your media selection. An
advertising or direct-mail campaign that targets too wide an audience may yield a lot of
unqualified prospectstire kickers who are interested but who are not qualified to become
customers because of price or other requirements.
What characteristics must your best prospects possess? Write down a brief description of your
target audience, then reexamine the readership of the publications in which you advertise, the
broadcast audience makeup and the list criteria you use when buying direct mail to be certain
you're reaching your best prospects.
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Next, examine your marketing materials, including brochures and sell sheets, to be sure they
don't make inflated claims that your product or service can't deliver. In that instance, prospects
may respond to your materials but feel let down when they find your claims are unrealistic. On
the other hand, your marketing materials may accurately present the benefits your product or
service offers, but your sales staff may fail to present them properly. In both cases, these
errors can pose significant sales barriers.
A sales process that's too lengthy or that puts the responsibility on the prospect to act can also
cost you sales. How many steps must your prospects take from the time they respond to your
media until they finally become clients? Put yourself in their shoes, and walk through your sales
process. Then eliminate as many steps as possible, especially those that require prospects to
take action on their own, such as by calling you or returning to the store if you're in retail.
Many sales are also lost because entrepreneurs and their staffs simply fail to ask for the
business. So train your staff in consultative sellingthat's uncovering and filling needs in a
friendly, noncombative and supportive wayto help improve your conversion rates.

6.4.

Our quiz can tell you how to sell with the best.

How advanced is your marketing knowledge? You may think you know it all-but you won't know
for sure until you take the quiz in this column. In order to challenge you on the latest
marketing information, we've broken it down into six vital areas, from how to reach working
women to PR strategy and trade magazine ads. So break out a writing implement, and circle
one letter for each answer. When you've completed the quiz, check out our answers. Then go
put that information to work in your own business.
1. Teens represent a $150 billion market, yet motivating them to spend their money can be
tricky. After product quality, which marketing factor do teens say has the most powerful
influence on their purchasing decisions?
A. Price B. Advertising C. Whether a company donates to a cause D. Celebrity endorsements
2. Contest promotions with large grand prizes are used exclusively by major corporations with
deep pockets to support big payouts.
A. True B. False
3. Broadcast faxing is a high-impact, low-cost direct marketing tactic that can replace direct
mail to cold prospects.
A. True B. False
4. Nine out of 10 women are the primary shoppers for their households, and 75 percent of all
women between the ages of 25 and 54 work full time or part time. What's the best broadcast
advertising vehicle for reaching them?
A. Radio B. Television
5. What percentage of buyers and specifiers (the people who are responsible for
recommending products their companies should purchase) look for Web site addresses in trade
magazine ads when they're trying to find additional information about the products?
A. Less than 10 percent B. 25 percent C. 50 percent D. Nearly 90 percent
6. Which of the following factors is the principal advantage of conducting market research
online?
A. Lower cost B. Speed C. Surveys hard-to-reach respondents D. All of the above

Better Than Cosmo

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Answers

Give yourself 20 points for each correct answer:

1. C. Eighty-five percent of teens would switch to retailers associated with a good cause,
according to the 2000 "Cone/Roper Cause-Related Teen Survey." After the quality of the product,
teens consider whether a company makes a donation to a cause (71 percent) and whether the
company supports the cause (68 percent) to be the second and third most important factors
when deciding what to buy. Teens indicate they're most concerned about violence in school, drug
and alcohol abuse and crime. Make a smart PR move by affiliating with related causes.
2. B. Entrepreneurs are increasingly sponsoring major promotions by using prize payout
insurance. Companies such as SCA Promotions Inc., in partnership with commercial reinsurers
such as Lloyds of London, offer guaranteed payment of prizes for on-air radio promotions, retail
and sports contests, and Internet promotions. For pennies on the dollar, the provider assumes all
the financial risks, helping a modest promotional budget support a large grand prize.
3. B. Although broadcast faxing is high-impact and low-cost, it is best used to maintain ongoing
relationships with existing prospects or customers. Unlike direct mail, unsolicited faxes fall afoul
of the FCC's Telephone Consumer Protection Act. Permission to send unsolicited faxes is
presumed to exist only if you have an established business relationship with the companies you're
faxing to.
4. A. Working women are approximately half as likely as the average adult to be TV watchers,
according to MediaMark Research Inc., and 16 percent more likely than the average adult to be
radio listeners. So radio is the best broadcast tool for reaching working women between the hours
of 6 a.m. and 7 p.m., which covers an important purchasing timethe evening commute home.
5. D. A whopping 87 percent of buyers and specifiers search for URLs in trade advertisements,
according to research by Martin Akel & Associates in conjunction with Cahners. If you want to
help buyers get the information they need quickly and easily, include your URL in all your trade
ads.
6. D. Considering the refusal rate of people asked to participate in phone or direct surveys has
reached 60 percent, online surveys make a good alternative. Entrepreneurs can find a variety of
vendors on the Internet that provide inexpensive, do-it-yourself research tools and databases for
B2B and consumer marketers. One such site is InsightExpress.
How Did You Do?
If you scored 100 to 120, consider yourself a marketing genius. If you fall between 60 and 80,
you should increase your efforts to bring your marketing knowledge up to speed. And if you
scored 40 or less, dont worryjust remember this quiz is simply an indication that its time for
you to get motivated and brush up on your skills.

6.5.

How to overcome your fear of public speaking.

Q: My business is such that I'm required to make presentations, either one-on-one or to small
groups. I usually have someone else do these presentations for me, but as my business grows,
it's getting more difficult to find someone who has the time. Plus, by now, I should be doing my
own presentations, but I still haven't gotten over my fears or nervousness. Am I in the wrong
business, or is there some way to learn how to do what seems to come naturally to everyone
else?
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A: In reality, terrific presentations don't come naturally to most people. There has even been a
published report that claims more people say they're afraid of public speaking than say they're
afraid of death. But I promise you, after nearly 25 years of training people to make presentations
and giving hundreds of presentations to groups large and small, I haven't known one person to
die from speaking in front of a group. In fact, it can be lots of fun, and it's a vital part of building
many types of businesses, including yours.
The three factors that make or break a presentation are content, structure and presentation style.
The best way to conquer your trepidation is to polish up on all three. Start by writing a complete
script or detailed outline of the content of your talk, making sure to create a benefit-oriented
presentation that contains valuable information. Consider what your audience is hoping to gain
from your talk, and center your message on how your prospects will benefit from accepting your
proposal. The structure of your presentation should flow logically from beginning to end, without
digressions or omissions. Try to anticipate the questions you'll receive, and structure your script to
allow for audience interaction.
Next, memorize and rehearse your presentation. The best way to polish your presentation style
and eliminate any bad habits is to use a video camera to tape your rehearsals, then watch the
tapes critically, looking for signs of nervousness or stiffness. For example, grinning, grimacing and
repeating a single word or gesture, such as shifting from one foot to the other or saying "um"
over and over again; speaking excessively slowly or quietly; speaking in a monotone voice; or
staring at the floor all convey nervousness to your audience.
Once you spot your problem areas, practice your talk until you're comfortable that you've
overcome them. Watching the videotape of your newly polished presentation style should give you
the confidence to begin making presentations on your own.

6.6.

Got Ideas?
If not, don't worry! Your workers do, so make them your marketing
team.

Want to know who's really responsible for marketing your company? Think beyond your ad agency
or marketing department, because every employee contributes to the achievement of your
company's sales goals, from your executives and advisory committee, to your receptionist, office
staff and plant workers. Everyone plays an important and specific roleand it all begins with you.
Successful entrepreneurs communicate goals, give their people a clear vision of the future and
make everyone in the company aware of their marketing promises. You're chiefly responsible for
motivating your entire staff to work as a marketing team by promoting both your vision and the
benefits employees will earn by helping you achieve it.
Where Good Ideas Begin
The best way to start is by setting up multiple idea channels within your company. Allowing people
to submit ideas only in circumscribed wayssuch as through a suggestion boxwill sorely limit
their contributions. Instead, make it clear that you're open to ideas on any topic, at any time.
Also, institute formal idea-generation practices, such as brainstorming sessions comprising diverse
teams drawn from all areas of your organizationnot just marketing and sales. When evaluating
ideas, consider potential results first, then examine them for feasibility. Einstein once said, "If at
first the idea is not absurd, then there is no hope for it." And who are we to argue?
Acknowledge and reward all ideas, reserving the biggest rewardsincluding financial incentives
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for those employees who generate ideas that pay off. Not all rewards, however, should be
monetary. A private thank you note or conversation will often suffice, or you can give an employee
a new and exciting project or more responsibility in his or her existing job.
Public celebrations and symbols of success also motivate employees and keep morale high. Years
ago, when I served as the director of development for a marketing communications agency, I kept
a pair of indoor roller skates under my credenza and donned them whenever we won a new
account. The sight of me skating through the halls, suit and all, signaled that our team's ideas had
rolled over the competition. That would, in turn, set off celebrations and congratulations
throughout the firm. Together, we grew the agency from a staff of 18 to about 120 employees in a
little more than four years.
Ideas You Can Use
Everyone in your company, regardless of his or her department or skills, can contribute ideas to
support your marketing efforts. Here's how:
Advisory committee or board members: Because they actively
provide referrals, client or customer contacts and introductions, they The
sight
of
me
can keep you abreast of new opportunities and economic changes that skating through the
could affect your company's position.
halls, suit and all,
Sales staff: They are your eyes and ears when it comes to signaled
that
our
customer feedback, new market potential and competitive information team's
ideas
had
that affect the way you market and even what you sell. Look to them rolled
over
the
for help on positioning and when you need to define your principal competition.
marketing benefits.
Office staff: Good communication keeps them generating positive
PR and referrals. Solicit their ideas for improving operations to make things better for customers.
Plant workers: They can point you to improvements sure to bring customer benefits and
marketable results, such as product adaptations, efficiency upgrades, new products and
innovations that affect quality.
Executives: As a continuing source of ideas that affect marketing strategy, they can help you
develop new markets through brand extensions and product adaptations and also generate
ongoing referrals and competitive information.
Receptionist: He or she can suggest ways to convey a more positive company image to
prospects and customers who contact you by phone.
Your employees take their cues from you. When you make it clear that ideas are welcome and
often rewarded, everyone in your company will pull together to achieve your ultimate goals.

7.

7.1.

MARKETING STRATEGIES

6 Ways Others Can Promote Your Business

When people ask if they can help you, be prepared to say yes with these
simple strategies.

How many times have friends, family and associates said "If there's anything I can do to help
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you, let me know"? How often have you said "Well, now that you mention it, there are a few
things you could do"? If you're like most people, you aren't prepared to accept help at the
moment it's offered. You let opportunity slip by because you haven't given enough thought to
the kinds of help you need. You haven't made the connection between specific items or services
you need and the people who can supply them. But when help is offered, it's to your advantage
to be prepared and to respond by stating a specific need.
Don't let the next opportunity for others to help slip through your fingers! Being prepared with
some simple requests can make a real difference in the success of your business. Systematic
referral marketing requires that you determine, as precisely as possible, the type of help you
want and need. There are many ways your sources can help you promote yourself and your
business:
1. They can provide you with referrals. The kind of support you'd most like to get from your
contacts is referrals--the names of specific individuals who need your products and services.
They can also give prospects your name and number. As the number of referrals you receive
increases, so does your potential for increasing the percentage of your business generated
through referrals.
2. They can introduce you to prospects. Your contacts can help you build new relationships
faster by introducing you in person to people they think need your products and services.
Furthermore, they can provide you with key information about the prospect. They can also tell
the prospect a few things about you, your business, how the two of you met, some of the things
you and the prospect have in common, and the value of your products and services.
3. They can endorse your products and services. By telling others what they've gained from
using your products or services in presentations or informal conversations, your sources can
encourage others to use your products or services.
4. They can display your literature and products in their offices and homes. If these
items are displayed well--such as on a counter or bulletin board in a waiting room--visitors will
ask questions or read the information. Some may take your promotional materials and display
them in other places, increasing your visibility.
5. They can distribute your information. Your contacts can help you distribute marketing
materials. For instance, a dry cleaner might attach a coupon from the hair salon next door to
each plastic bag he/she uses to cover customers' clothes. Including your flier in the middle of
their newsletter is another idea.
6. They can publish information for you. Your contacts may be able to get information about
you and your business printed in publications they subscribe to and in which they have some
input or influence. For example, a source who belongs to an association that publishes a
newsletter might help you get an article published or persuade the editor to run a story about
you.
Keep this list with you and add to it as other needs occur to you. Knowing how to match your
needs with the right sources is key to obtaining the type of help you need. But remember--it's a
two-way street. These support activities are also things you can do to help your contacts
promote their businesses and generate referrals. Helping your sources achieve their goals goes a
long way toward building effective and rewarding relationships.
Finally, it's good practice to develop a list of ways to reward referral sources for helping you.
Once a referral has become a customer, be sure to recognize and reward your source
appropriately. Doing so encourages them to send you more referrals. Distinguish between
tangible (e.g., cash) and intangible (e.g., a public thank-you) rewards. Estimate the cost, and set
aside some money to pay for your recognition program. The key is to find a unique, memorable
way to say "Thank you" and to encourage your colleagues and friends to keep sending you
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referrals that turn into business.
It may take a while, but if you've selected and trained your sources well, and if you use the
system to its best advantage, you will speed up the process of turning the ever important
referral into business.

7.2.

Achieve Growth Without Borrowing Funds

Use strategic alliances to grow your business fast.

Q: I would like to grow my business; however, I would rather not borrow anymore money for now.
Is there any way I can increase my business' sales and profitability without having to invest
additional dollars?
A: Yes. One of the most powerful ways to facilitate business growth is through the application
strategic alliances. These alliances, or virtual funding as they are sometimes called, allow you
enjoy many of the benefits typically associated with the infusion of cash into your business, and
do so within a very short period of time. By using strategic alliances, you can avoid having
borrow, or bring outside investors into your business.

of
to
to
to

Two important strategic alliances are marketing alliances and product alliances. Under a marketing
alliance, you and another business exchange customer bases. This allows you to gain access to
another business's customers, to whom you can market your business's products and services.
Additionally, you may be able to earn a royalty or share revenue from the other business' (your
alliance partner's) sale of its products and services to your customers.
With a product alliance, you are able to offer another business's products and services to your
existing customers, while your alliance partner sells your business's products and services to its
customers. Under this type of alliance, your business is able to sell products and services without
any additional costly requirements, such as manufacturing know-how and capabilities, product
distribution networks, or increased investment in inventory and storage. Under most circumstances,
your alliance partner can direct-ship its products and/or provide services directly to your customer,
without your business having to be involved at all beyond the sale. All your business has to do is
collect the money and divide this sales revenue between your business and your alliance partner.
The Internet has more clearly defined the respective roles of strategic alliances for business owners.
Marketing alliances are facilitated by merely creating a direct link from one business's Web site to
their alliance partners'. The other business's customers can reach your business with the click of a
mouse (and visa versa). Product alliances are created and activated when one business's customers
move to your business' site and purchase products and services, and when your customers travel to
other businesses' sites and make purchases.
The ideal businesses with whom to form alliances are those that offer products and services that
are complementary to those of your business. For example, if your business offers sporting
equipment, you could create an alliance with a sports clothing retailer as a way of offering their
sports clothing to your business's customers, while they sell your business' sporting equipment to
their customers.
Before you enter into an alliance with another business, you must complete due diligence research
and analysis to determine the trustworthiness, capabilities and reputation of any potential alliance
partner. Referrals from a business's customers and/or suppliers are good sources of information,
along with any credit information you can access. If the potential alliance partner has any existing
successful alliances with other businesses, this feedback should be very useful to you in making
your decision about this potential alliance partner. Also, be certain that you obtain signed copies of
any and all appropriate confidentiality and noncompete agreements, as well as any operating
contracts, before you enter into any agreement. This requires that you have legal documents drawn
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up, protecting such assets as your business's proprietary trade secrets, its reputation and, above
all, your business's relationships with its existing customers.
Finally, before you make a strategic alliance a permanent agreement, you should test your alliance
concept with each potential alliance partner. Once you have the results of your tests, you can refine
the terms and conditions of the alliance and then finalize all legal documents and operating
agreements.
Remember, in order to be successful, an alliance must benefit all members sufficiently to both
entice them as well as maintain a strong level of interest and working cooperation throughout the
entire term of the alliance.

7.3.

Get Big Marketing Results With Little Cash

Don't dry up your funds with expensive marketing methods. Instead,
make a name for your company with creative (and outlandish)
grassroots methods.

Q: We have a very limited marketing budget. What can you suggest to make our company stand out
and bring in new customers?
A: Marketing doesn't have to cost a lot to have a big impact. Thinking outside the box--from
outlandish stunts to quirky grassroots marketing--can make your company stand out. The challenge
lies in making your promotion memorable, consistent with your company image, closely linked to
your product or service message, and, above all, motivational.
Get Customers Involved
The best way to motivate customers for very little money is to get them involved on an emotional or
experiential level. Here's a great example featuring a familiar product. The LifeSavers five-flavor
pack has been around for years, and the company has consistently studied consumer response to
each individual flavor. But it wasn't until LifeSavers considered phasing out its pineapple flavor that
it turned research into a highly effective promotion.
LifeSavers set up a special Web site and toll-free number asking customers to vote to keep
pineapple or replace it with strawberry or watermelon. When more than 1 million passionate
responses were tallied overall, the pineapple flavor was saved from extinction. LifeSavers got
tremendous publicity from media reports on the company's responsiveness to the overwhelming
public demand. And LifeSavers energized its customer base with an extremely low-cost promotion,
when compared with what it would have paid to gain the equivalent number of gross impressions
through advertising or any other marketing means.
Entrepreneurs often use low-cost grassroots marketing tactics to introduce products. Bill Flaherty,
the 45-year-old president of Toy Craze, makers of Crazy Bones plastic toys, used scout meetings,
club groups, fairs and shows for toy demos to get his product in front of the target audience and
create a buzz. His company eventually landed Crazy Bones in a McDonald's Happy Meal, plus chain
stores Zany Brainy and Learning Express, and remains committed to grassroots marketing.

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Make It Memorable
You don't have to host a bungee jumping contest to stand out. Consider the San Francisco missiondistrict restaurant, Casa Sanchez, which offered free lunch for life to anyone who got a tattoo of
their Jimmy the Corn Man logo. When the contest was announced with a simple flier in the
restaurant window, two local nightclub employees got the tattoos and spread the buzz. If you think
this is too outlandish a proposition to be effective, note that through the course of the promotion, 39
people were willing to be tattooed with the sombrero-wearing mariachi boy riding a blazing corn
cob, according to an Associated Press story. That's right, the Associated Press, LA Weekly, USA
Today and local TV stations were among the media that picked up the story, affording the restaurant
extensive coverage for what was essentially a free promotion.
If you can't induce customers to tattoo themselves with your company logo, try the next best thing.
Use giveaways with your logo in conjunction with a promotion. During the Thanksgiving 2000
holiday weekend, the Atlanta Chamber of Commerce gave away 3,000 pairs of sunglasses in New
York's Times Square with the Web address AtlantaSmartCity.com printed on the earpiece, all
designed to build awareness of high-tech career possibilities in the Atlanta area.
Link to Your Company Message
Whether you use outrageous stunts or basic grassroots marketing, you still have to rely on strategic
thinking to develop a core message and strategy. While stunts may be platforms for your product,
they must be relevant and communicate something memorable that reflects well on your company.
The bottom line is to have a theme you can support with other tactics, not just a single event. Then
get creative by combining fun with customer involvement, and you'll grab attention and make your
message stand out.

7.4.

Partnership & Place-Based Marketing Techniques

This one-two punch is a great combination for a low-cost, high-reach
campaign.

Q: I've recently started my own custom wiring and home theater business and have a limited
advertising budget. I've sent business cards to contractors and developers, made cold calls and
even gone door to door in some of the newer neighborhoods, but we still have few customers.
What do you suggest?
A: Launching a consumer product or service business on a tight budget can be challenging. To
get your new business off to a solid start, try combining two proven techniques: strategic
partnering and place-based, or "ambient," marketing.
Right now, you have limited funds and staff. To overcome these negatives, you can partner with
other businesses that have more extensive marketing budgets and can provide a means to reach
your prospective customers. Since you market home theaters, having a display in a retail store
that specializes in upscale furnishings could expose the right prospects to your product and
message. Their retail staff would sell for you, and your product could be included in the store's
newspaper ads for considerably less than if you were to create your own campaign.
Place-based, or ambient, advertising reaches prospects wherever they happen to be--preferably
in the right environment to be receptive to your message. You can now reach consumers the way
search engine Ask Jeeves did--by sticking its name on 15 million grocery store apples. You can
make blanket-sized impressions on public beach sand like Skippy peanut butter or Snapple, or
purchase wraparound banners on gas station and convenience store light poles like Gatorade and
McDonald's. Advertisers are putting their product names and logos on athletic stadium snack
packs and on posters in nightclub bathrooms. It seems if there's an empty surface of any kind

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anywhere, there's a company selling ad space there.
Do-It-Yourself
Savings
But why pay an advertising fee when you can create your own place-based opportunity? The key
is to find the right environment and to stretch your marketing dollars by getting other businesses
to market with/for you. Here's a good example: If you have a pet, you probably spend some
time in the veterinarian's office. Ever notice all the rack brochures and posters that contain
helpful information supplied by the makers of pet foods and flea remedies? These companies are
taking advantage of place-based advertising opportunities. Chances are, since visitors to the
veterinarian's office are thinking about pet health and nutrition, they'll be more likely to pick up,
read and perhaps take home these marketing tools.
With a bit of negotiation, you could put a home theater display in a retail showroom frequented
by your target customers. The display might be accompanied by signage with your company
name and contact information and a rack brochure on your business and its products. You could
give scheduled talks for customers on how to set up a home theater and create a contest or
giveaway that could be promoted in the store and in its advertisements to draw attention to your
display.
By combining marketing partnerships with place-based marketing strategies, you'll create a lowcost, high-reach campaign that affords multiple opportunities to make impressions on B2B
prospects as well as consumers. Having a quality display in a good retail location will help you
earn credibility as a viable business and will go a long way toward building the trust you need to
gain valuable B2B contracts. It will also help you create effective marketing tools. For example,
you could shoot a short promotional video demoing the installation and setup of the retail display
to use as a presentation tool with B2B prospects. And you could use the retail display site to
meet with select contractors and developers.
All in all, your marketing efforts can go as far as your imagination and your ability to foster
successful marketing partnerships will take you. With a bit of negotiation and hard work, you'll
get what most new entrepreneurs need most: lots of bang for very few bucks.

7.5.

Partnership Pointers
Growing your online business through successful alliances.

Q: I have created an original e-learning portal that appeals to a receptive global niche market. Part of
my strategy is to form partnerships with academic and corporate entities. The products and services
I've developed offer a "ready-made solution" to these potential partners who have not yet developed
the niche I've targeted, although they're in this space. How can I formulate an alliance strategy with
specific intervention approaches?
A: The key to successful partnerships is universal whether you're dealing in the e-learning segment or
another equally defined niche: Both parties must feel they have sufficient equity in the venture and can
meet specific goals that are strategic to their business. In order to achieve a balance of equity within a
partnership, you'll need to do your homework about your desired targets prior to approaching them.
By conducting the necessary research regarding your alliance targets, you'll be able to define the key
points that are strategic to their business. This will allow you to formulate specific approaches you can
use to elicit interest from your targets and generate a response to your query.
Too often, business development managers don't do the necessary research on their targets to fully
understand their needs. They are too consumed by their own business models and submit query after
query using the same pitch line and benefit statements, expecting the business development managers
at their targets to be immediately captivated by what is essentially a one-sided offer.

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For example, revenue-share proposals are currently popular. Every service and product is pitched with
a revenue-share component as the core benefit with the close, "It will make you a lot of money!" The
reality is, revenue share strategies rarely make anyone "a lot of money" unless you want to devote "a
lot of real estate" to them. There are, of course, exceptions. These are products and services that will
invoke initial interest. Beyond that initial spark of interest is where your research can make a
difference.
There are several approaches you can take to form your strategies, depending on the needs of your
targets.
They include:

Revenue components. Instead of a straight revenue share, are there strategies you can build
whereby you are able to retain the major portion of a sale generated through the target's source
in return for providing revenue components to the targets that are strategic to their business.
For instance, in exchange for marketing and distribution of your product or service by the
target, you can offer to promote within your own properties, items deemed significant by the
target. In this manner, both parties accomplish their goals.
Co-branded environments. Under this strategy, you can work with your target to create a
mutually beneficial co-branded environment whereby the product or service can be offered, thus
extending the revenue-share model into a more strategic framework. The co-branded
environment can be combined with the intent to embed all revenue components so both parties
can benefit from the partnership. For instance, you may offer your targets a co-branded elearning portal that combines items you deem strategic along with other components for the
target.
Private-label environments. Many times, targets with established brands prefer to develop
products under their own "halo." This may benefit your business as well. Having your product or
service positioned under an established brand not only may increase sales of your product or
service, but it may also serve to better position your partnership opportunities to other targets
you are pitching.
Under a private-label environment, the product or service would be offered through a design
identical to the target with their brand present, not yours. You may charge for the initial buildout of the private label or ask to retain a greater portion of the revenue share. As with the cobranded environment, you can also mix in additional revenue components if it will help ice the
deal.

Pay-for-placement. Sometimes referred to as anchor fees, there may be some targets that are
especially strategic where you may want to buy your way into their properties if all else fails.
This is a pay-for-placement strategy whereby you'll retain all revenue from sales by paying
upfront what you expect to recoup in sales.

There are various hybrids of this model. Some rely strictly on a flat fee. Others rely on an initial
allowance that's paid on a monthly basis. Once sales reach the allowance level, the target partner then
shares in the wealth through a revenue split. This particular model is used to offset the amount of the
initial anchor fee.
As you can see, there are a number of ways you can structure the initial query. Much depends on your
research. Find out what makes a particular target tick, then fashion a strategy that will capture their
interest.

7.6.

Ride the Sold Train

No matter your budget, you can create retail marketing that screams
"Hey, check me out!"

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Looking for the best way to market your retail business? From cybercafes to local dry cleaners,
this month the spotlight is on building retail traffic and sales. The goal is choosing the most
effective marketing opportunities within your budget. Because advertising costs are based on
the number of people who will be exposed to your message, your media dollars will go further in
a smaller city or town than in one of the top 10 largest markets.
But no matter where you're based, you can select from a host of marketing options, including
directory ads, television, radio, newspaper, Web marketing, PR and events, marriage mail and
outdoor media. Depending on your budget, here are some ideas for how to spend your
marketing dollars:
$100,000 to $150,00 budget: A well-rounded marketing mix will always generate the best
results. For example, imagine you're the owner of three cybercafes where customers can surf
the Internet while enjoying cafe lattes, light meals and desserts. A radio campaign would be an
important part of your mix. To make your ad stand out, you'd choose the stations that best
reached your customer base and purchase the first spot in the commercial blocks. You could
also book promotional activities, such as after-work parties with station DJs at your cafes. Ads
on taxi tops or bus shelters (www.clearchanneloutdoor.com), in addition to "marriage mail"-your coupon mailed in an envelope with those of other advertisers--would allow you to target
workers and residents near each cafe. And advertising in an "alternative weekly" newspaper,
such as the Washington City Paper in Washington, DC, or Atlanta's Creative Loafing, could be a
lower cost option than the major daily (find one at www.casscom.com). To round out your
marketing program, a fund-raising drive to put computers in inner-city schools would generate
positive PR.
Now, say you own a business that allows more visual presentation, such as a plant nursery and
garden center. Instead of radio advertising, you could place seasonal television campaigns on
local cable and independent stations, with an emphasis on programming that reaches gardening
buffs, and use billboards to drive traffic (www.infoutdoor.com). A 10-foot-by-30-foot billboard in
Phoenix, for instance, costs just $900 per month. And you could offer workshops by plant
experts and promote them in a customer newsletter.
$50,000 to $100,000 budget: Are you located in a small to midsized market, and do you sell
products with strong visual appeal? You can use cable television--an affordable, high-reach
consumer marketing vehicle. It would make a big impact for a retail craft gallery, for example,
with newspaper advertising, online marketing and special in-store events.
Retailers in higher-cost media markets and those selling products aimed at specific consumer
segments can use more focused media. For instance, an electronics store could place ads in
magazines or weeklies that reach a tech-savvy group. And instead of marketing on television or
radio, a children's clothing boutique might advertise consistently in a parenting publication at a
much lower cost. For a well-rounded campaign, you could add PR such as charitable events
related to children's issues and a customer-reward program.
$10,000 to $50,000 budget: Even when funds are limited, directory ads alone aren't enough
to build a campaign. Here, low-cost tools, such as marriage mail and customer relationship
marketing programs, take on greater importance. A dry cleaner could test special offers by
sending marriage mail from Val-Pak (www.val-pak.com) to nearby households. A gift shop
owner might build a customer database and mail discount offers to frequent shoppers to give
them a reason to come back.
And it pays to search for media opportunities. The owner of a deli, for example, might donate
sandwiches to the local National Public Radio station in exchange for on-air mentions. It doesn't
cost a lot to reach your best customers-it just takes some creative thinking.

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7.7.

Secret Service
Boost your business by doing a little shoppingundercover, of course.

Thomas Stemberg, the CEO and founder of Staples, is addicted to shopping. Despite the fact
that he heads an $11 billion store chain, Stemberg continues to shop the competition in person,
sometimes even enlisting family members to helpincluding his mother-in-law, who, he says,
"was a regular shopper at Office Depot's delivery business to help me learn how it worked."
Shopping the competition is one method of stimulating growth and innovation for your retail
operation. It's easy, do-it-yourself research that can help you find your marketing edge by
monitoring service from the customer's perspective.
Getting the most out of competitive store visits means having clearly defined
objectives and knowing what matters most to you and your customers. A
Mystery
shopping is an clothing store owner, for example, might shop her competitors to compare
early warning prices, the variety of sizes and styles in stock, store hours, store clerks'
friendliness and the way customers are greeted. With a good shopping
system for
any business program, you experience your competitor's store the way customers do, then
that relies on apply the best of what you learn to your business.
extensive
public contact. Also shop retailers outside your industry. Laura Livers, president of Shop'n
Chek, a mystery shopping firm in Atlanta, recommends finding a company in a
noncompeting field that faces similar operational challenges, such as handling
phone orders and comparing their tactics and techniques so you can develop
ways to improve yours.
Stemberg suggests small retailers study the tactics used by leaders outside their industries
"such as the Wal-Mart greeter," he saysand learn to emulate them.
The other side of shopping-based research takes place in your own store. Mystery shopping is an
early warning system for any business that relies on extensive public contact. Because poor
service is most often cited as the reason for loss of sales, consider hiring a mystery shopper to
evaluate the experience your store offers. Professional mystery shoppers go to businesses
posing as ordinary customers and then provide evaluations of their experiences using written
questionnaires and reports.
"A successful mystery shopping program can evaluate and measure the product knowledge and
skills of salespeople," says Livers, whose company has nearly 30 years' experience and 90,000
shoppers throughout the United States. She says a visit from a mystery shopper is a "snapshot
of time, and the more often you shop, the more you fill your photo album and start to identify
strengths and weaknesses."
Before starting a mystery shopping program, understand what your customers want. Suppose
you own a store that sells energy-efficient windows and doors. Mystery shoppers can't help you
build sales over the long term if the product quality is poor, and they can't tell you what your
target market wants from your business or products. But they can help ensure that people who
come in to shop for windows are waited on promptly and courteously and that the sales
information is presented consistently. "Identify what the consumer wants and build a training
program around meeting their expectations," says Livers.

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7.8.

VIRAL MARKETING. Imagine your marketing messages growing on their

own. No expensive ad space. No overworked sales team. Just your
product and your message . . . spreading. That is viral marketing.

It's Alive!
Imagine your marketing messages growing on their own. No expensive ad space. No
overworked sales team. Just your product and your message . . . spreading. That is viral
marketing.
Jeff Smith has the kind of bug every marketer wants to catch. In seven years, the 32-year-old
founder and CEO of Tumbleweed Communications Corp. in Redwood City, California, has built a
company valued at more than $1 billion. Customers such as UPS and American Express rely on
his service to deliver secure electronic messages. But here's what's even more amazing: At the
beginning of 1999, Smith had only 40 employees. Today, Tumbleweed's payroll tops 200.
How could such a tiny company grow in such a short time to capture such big-name customers
and command such a massive market capitalization? One answer is that Smith is regarded as
one of the premier practitioners of viral marketing. Viral marketing is a special kind of marketing
that creates rapid adoption by employing word-of-mouth networks, according to Tim Draper, a
Redwood City, California, venture capitalist and Tumbleweed investor, who is credited with
originating the term in 1997. Elaborates Smith, "It means that usage of a solution promotes the
adoption by beneficiaries."
In practice, Tumbleweed's viral marketing works like this: Tumbleweed's customers send e-mails
to their customers alerting them to the need to transmit credit reports, statements, invoices or
other documents ordinarily considered too sensitive to send over the Internet. In the message is
a Web site address that the message recipient can click on to access an encrypted, passwordprotected file containing the sensitive document.
It's a useful service that promises to provide a cheaper and faster alternative to the couriers and
express package services generally used for delivering sensitive documents. But a key to
Tumbleweed's rapid growth, according to Draper, is that everyone who gets a secure message
notification from a Tumbleweed customer also receives the address for Tumbleweed's Web site
along with it. The recipient must visit Tumbleweed's site to retrieve the document. "So when a
new customer starts to use Tumbleweed, thousands of potential customers receive the
Tumbleweed pitch," wrote Draper and co-author Steve Jurvetson in a seminal 1998 article on
viral marketing.
Tumbleweed isn't viral marketing's only success story, though. Hotmail, an e-mail service started
in 1996 and sold to Microsoft for $400 million in 1998, signed up millions of subscribers with the
help of a self-promotional plug inserted at the bottom of every message its users sent. Blue
Mountain Arts, a greeting card company, lets visitors to its Web site create electronic cards and
send free greetings-recipients have to visit the site to see the cards. The company, which
started in 1971, sold its online operation to Excite@Home in October 1999 for nearly $780
million.
The Internet isn't the only place viral marketing can thrive. Trivial Pursuit's climb from an
obscure Canadian parlor game to a pop-culture trend with more than $1 billion in sales may
have been the result of its viral-style marketing, says Chris Byrne, a marketer who worked on
Trivial Pursuit's extraordinarily successful introduction in 1983. He also contributed to the
development and implementation of the marketing program for Pictionary, as well as its launch
from 1985 to 1987. Byrne, now editor of toy marketing journal The Toy Report in New York City,
says the late marketer Linda Pezzano generated viral buzz long before the Internet was a
household name distributing free games to toy buyers, celebrities and even fellow passengers
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on airplanes. She got people talking about Trivial Pursuit and Pictionary by staging gameplaying
contests in bars, restaurants and other venues.
Even in today's Internet-crazed world, you can market virally with the lowest of techs. Book
publisher W.W. Norton markets Patrick O'Brian's 20-volume seagoing novel this way-by including
in each book a certificate offering to mail anyone the buyer chooses a free copy of the first
volume in the series.
The Speed Of Viral Marketing
Spreading Fast
The beauty of viral marketing is that it combines speed, economy and effectiveness in a single package.
When successful, it works off a relatively small marketing investment. Hotmail, for one, spent just
$500,000 advertising its service, yet its viral marketing snagged more than 12 million users in its first 18
months. Meanwhile, a competitor, Juno Online Services, spent more than $20 million promoting its free
advertising-supported e-mail service, including mass mailing CD-ROMs of free software. What did it get?
Just two million users. The speed with which viral marketing can operate is breathtaking: After just four
years in business, Hotmail now has more than 50 million usersmaking it the world's largest e-mail
service.
This extremely fast rate of growth is due in part to having a large number of people pass on the message,
allowing for rapid expansion as more and more people are exposed to it. Another factor is the implicit
personal recommendation each user provides simply by passing on the advertising message to friends and
associates. Says Draper, "The implied endorsement is a strong and effective feature that allows something
like this to spread much faster."
What Makes It Work
Infection Accomplished
Although viral marketing is relatively new, at least in its current incarnation, it's clear there are
certain rules that govern successful viral marketing programs:
It has to be easy for your customers to propagate your message. Hotmail set the standard
here with its technique of automatically inserting its plug at the end of every e-mail message.
But viral marketing doesn't have to rely on such passive users. Some marketers have gotten
good results with Web site buttons that let visitors forward information or recommendations by
clicking and entering the friend's e-mail address.
You have to wrap your virus in something that people will consider worth passing on. The
wrapper might be something useful, such as a free e-mail account. Or it might be something
entertaining or simply interesting, such as an animated dancing baby.
In addition to being valuable, the device containing it should be free. If not, you have to offer
an unusually high value-to-price ratio.
Viral marketing won't work if you try to pay people to distribute your marketing message,
warns David Roman, vice president of marketing for ReleaseNow.com in San Carlos, California.
The 90-person firm, which helps software companies create viral distribution of evaluation
products, recently studied the effect of offering people discounts on future purchases in
exchange for passing trial software on to their friends. "Much to our surprise, we found it was
counterproductive," Roman says. "People would send it on more easily if everybody knew they
weren't getting anything out of it."

Whatever you do, don't neglect to include your message in the virus. Bill Hunt, COO at
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Multimedia Marketing Group in Bend, Oregon, a veteran of numerous viral marketing
campaigns, points to the dancing baby animation that started in 1996 as a free sample bundled
with a software package from Kinetix in San Francisco. Thousands of people e-mailed the file
containing the eerily captivating image to friends. Eventually it decorated numerous Web sites,
appeared on television programs and ad campaigns and inspired T-shirts and musical
recordings.
True, the viral propagation of the original file and its later modifications made Kinetix's dancing
baby a pop-culture icon whose popularity endures today. "[But] what they didn't do," notes
Hunt, "was put in that document what it was created by." As a measure of the effects of this
oversight, nobody associates the dancing baby with its creatora simple Internet search returns
more than 81,000 pages relating to the dancing baby, but only 6,000 for Kinetix, and just 299
with both terms.

When It Works Best

Resistant Strains
Viral marketing won't work for just any product. It's most effective with things that are trendy or at least
have a high profile in the popular eye. Hotmail's rampant growth had a lot to do with the explosion in the
acceptance and use of e-mail at the time it was launched. Similarly, the dancing baby's appeal was largely
based on the novelty of computer animation.
It also works best in markets where there is little entrenched competition, or when the established
competitors can't, for one reason or another, counter with a matching viral program. Automobile
manufacturers, for instance, might be prevented by strong ties to their dealer networks from pursuing
viral-type strategies, which could cut into dealerships' sales opportunities.
Most viral marketing to date has been in mass-market products and services, such as compact
discs and books. Business-to-business uses have been limited, although some viral marketers
see B2B as the next frontier. "We have used it inside a business-bot business channel," says
Hunt. "But it's really suitable for anything where there's a widespread consumer interest."
The Risks
Gotcha!
Viral marketing has its downside as well. By suddenly flooding a market with free or low-cost
products and services, it can drastically reduce the total revenue generated by that market. This
means firms employing viral marketing have to postpone sales, not to mention profits.
Presumably, sometime in the future, they'll be able to capitalize on their outsized market share
by raising or instituting prices or by selling advertisers their ability to capture consumers'
attention.
Extremely rapid growth, profitable or not, also carries the significant risk that the firm will not be
able to handle the increase in volume. Successful viral marketers like Tumbleweed may gain a
million customers in one quarter, doubling their user base and requiring enormous additions of
technology, equipment and people. "That's kind of hard to absorb," notes Smith. "That's the
'Gotcha!'"
Vigorous viral marketing can turn negative if it goes too far and irritates customers by making
them unwilling carriers of excessively commercial messages. Roman says it's important to realize
that viral techniques are for spreading marketing information, not for closing sales. Marketers
have to be careful not to try to include implicit endorsements that exceed what the virus carriers
are willing to bear. He adds that if a viral marketer's plan calls for collecting e-mail or other
addresses of people who are receiving the message, the company must post a prominent
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statement of its privacy policy, promising not to sell or use personal information for any other
purpose.
Another risk is the possibility that a viral marketer will lure large numbers of customers to what
turns out to be an inferior product. "If you don't have a great product," Smith contends, "it
doesn't matter how you market it."
Byrne goes even further, warning that the rapid and intense growth in attention that can go with
viral marketing may make product flaws even more of a liability than with traditional marketing.
"The bigger the sizzle," Byrne says, "the bigger the fizzle."

Study Its Course

Some experts expect viral marketing to become a dominant mode of marketing for the Internet
economy.
As marketing messages from all sources increase, notes Byrne, those few that are delivered by a
friend or acquaintance increasingly stand out. "In a world of spam," he says, "this kind of personal
endorsement is going to be worth even more."
Viral marketers are also learning to apply this method of promotion to new uses beyond the mass
markets where it's been successful so far. Smith predicts the first thing that will happen is that
viral marketers will abandon the increasingly crowded consumer space and focus on the businessto-business channels. "You're going to see fewer business-to-consumer applications of viral
marketing," Smith says, "and more business-to-business."
Instead of trying to get large numbers of customers to pass along their message, viral marketing
to businesses will probably concentrate on getting endorsements from a smaller group of highly
influential corporate customers. Smith points to Tumbleweed's recently successful effort to attract
UPS to a Tumbleweed-based online document-delivery service. "Those businesses with whom they
communicate now become leads for UPS to utilize the secure document exchange," Smith says.
"And we'd hope to enroll those businesses as adopters of the UPS document exchange as well."
The image of a marketing campaign expanding on its own like a computer virus infecting a
network is catchy, and the stories behind Tumbleweed and Hotmail, which attribute enormous
success to viral marketing, are indisputably extraordinary. But one of the technique's appeals is
that it reaffirms a basic marketing commonplace: Nothing succeeds like success. "It means,"
shrugs Smith, "that usage drives adoption." The more people who use something, the more
people who will try it and become adopters themselves.

7.9.

Word-of-Mouth: The World's Best-Known Marketing Secret

Everyone knows about it, but hardly anyone does it well. It's time to
change your approach to word-of-mouth marketing.

What if there were a way to build your business, year in and year out, regardless of fluctuations
in the economy or the activities of your competition? Well, there is. It's called word-of-mouth.
Word-of-mouth marketing truly is the world's best-known marketing secret. You're probably
wondering how anything can be both the "best-known" and "a secret" at the same time. Easy.
Practically every businessperson knows how important word-of-mouth marketing is. Yet almost
no one truly understands how to build their business through word-of-mouth.
Some people think that word-of-mouth is a little like the weather: fairly important, but not
much they can do about it. Many others think that it's just about good customer service, but it's
not. Don't get me wrong--good customer service is critical for the success of any business, but
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if you expect happy customers to talk about you a lot--think again.
For the past two decades, I've talked to tens of thousands of business professionals about
word-of-mouth marketing and customer service. I've described how the "average unhappy
client" can talk to dozens of people about their bad experience. I've then asked my audiences if
their "average happy client" truly talks to as many people as a potential unhappy client. In two
decades, no one has ever said yes to that question!
Unfortunately, people are more likely to talk about your business when they are unhappy than
when they are happy or satisfied. Therefore, good customer service generally reduces
"negative" word-of-mouth. However, the good news is, there are many things entrepreneurs
and business professionals can do to positively impact their business through word-of-mouth.
Below are the three most important things that a business professional can do to start the
process of increasing their business through word-of-mouth.
1. Diversify your networks. I believe that most business professionals are cave
dwellers. They get up each morning in a large cave with a big-screen TV called their
home. They go out to their garage and get into a little cave with four wheels called their
car. They go to another really big cave with plenty of computers called their office. At the
end of the day, they get back into their little cave with four wheels and drive back to the
large cave with the big-screen TV, and they can't figure out why no one is referring
them. If you want to build your business through word-of-mouth, you have to be visible
and active in the community by participating in various networking groups and/or
professional associations.
2. Develop your contact spheres. Contact Spheres are businesses that are symbiotic
and noncompetitive to you. For example: a lawyer, an accountant, a financial planner
and a banker. All of them have clients with overlapping similar needs. They can all work
with and refer each other easily. Another good example is what I call the wedding mafia:
a florist, a photographer, a travel agent and a jeweler. A referral for one of them
becomes a referral for all of them. You should immediately determine what professions
fit within your Contact Spheres and start developing relationships with them.
3. Word-of-mouth is more about farming than it is about hunting. Building your
business through word-of-mouth is about cultivating relationships with people who get to
know you and trust you. People do business with people they have confidence in. One of
the most important things I've learned in the past two decades is this: It's not what you
know, or who you know, it's how well you know them that counts. If you go into this
process understanding this one key point, you will have a better opportunity to build
your business through word-of-mouth.

8.

8.1.

LEARN THESE!

LEARN TO MAKE PROFESSIONAL MAILING LISTS. Building an Effective

Mailing List.To get your direct-mail message across, you have to start
out with the right names.

Q: How do I go about finding the right mailing lists that target my customers?
A: Much depends on the specifics of who your customers are and whether you're targeting
businesses or consumers. But, generally speaking, here are nine avenues for you to explore to
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get you started in the right direction.
1. Small Business Development Center (SBDC): The SBDC is a government program
sponsored by the SBA and funded by your tax dollars. It provides expertise and advice on a
variety of small-business issues, including marketing, at no charge to you and has access to
targeted mailings, which it can offer to you, as an SBDC client, at a relatively low cost. Log on
to www.sba.gov/sbdc to find the SBDC center nearest you.
2. List brokers: Look them up in the Yellow Pages under "Mailing Lists," "List Brokers" or
"Mailing Services." A good list broker knows what lists are available and can also advise you on
what type of list would work best for your business. Many list brokers can also custom-build
lists based on your specifications.
3. Trade associations: What trade associations do your prospects belong to? Say, for
example, you want to reach professional speakers. In this case, you'd contact the National
Speakers Association and ask to rent or purchase a mailing list comprised of its members.
4. Local chamber of commerce: This makes sense if you're selling to local businesses. Most
chambers of commerce sell a member directory or offer the directory as part of their
membership package.
5. Internet directories: Do a Google search (at www.google.com). For example, I do a lot of
work with PR and ad agencies across the country. To find qualified prospects, I recently
conducted a Google search on "PR agency directories." One of the search results was Agency
ComPile (www.agencycompile.com), which has more than 1,000 agencies in its database,
indexed according to various categories. This site has been an invaluable research and listbuilding tool for me--and it's FREE. Perhaps there's a useful directory on the Web that features
your target customers.
6. Magazines and trade journals: Magazine and trade journal publishers usually have a list
manager, who handles orders for the mailing list. Therefore, if you know that subscribers to
Men's Health Magazine, for example, are likely to be good prospects for your product, then you
can rent their subscriber list directly.
7. Community newspapers: This approach makes sense if you're targeting local consumers
as opposed to local businesses. Just as with magazines and trade journals, call the community
paper and ask for the person in charge of mailing list rentals.
8. Homeowner associations: Say you want to target your mailing to local upscale consumers
who live in homes valued at $300,000 and higher. A good place to begin is to scout the
neighborhoods that fit your profile and then find out which associations manage those
subdivisions.
9. Building your own list: How do you build your own contact list? Anytime you meet people
who fit your customer profile, put their information in your database. If you find qualified
prospects through your Internet research, add them to your list. Or if you've purchased a
directory from the chamber of commerce or trade associations, include those contacts. Over
time, you may find that you've built a database extensive enough that other businesses would
want to rent your mailing list.

8.2.

Learn to make the most effective MARKETING DATABASES

You know the drill: Go through the checkout line at the supermarket and whip out one of the
several hundred plastic cards in your wallet so the checker can scan it for your extra-special
club savings. So did the savings of $.35 on a can of olives and $1 on dog food buy your
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loyalty for that particular chain? Not likely.
Theres a whole lot more to gaining customer loyalty than discounts, and thats where
customer relationship management comes in.
QUESTION: What is customer relationship management? How is it revolutionary compared to
database marketing?
Frederick Newell: Its the next stage of database marketing. In database marketing, we were
trying to learn about customers to sell more of what we wanted to sell. With customer
relationship management, were trying to learn more about customers so we can offer them
things they want to buy. Theres a big difference.
QUESTION: What are the biggest mistakes you see companies making when trying to build
customer relationships and loyalty?
Newell: One of the major points of my book is that discount and points programs are not
going to build loyalty. Theyll get people to show a card so you can capture transactional
information and thats fine, but you cant buy loyalty with discounts or points. You have to
develop loyalty by making customers lives easier and more pleasant, making it easier for them
to do business with you. And thats a mistake many, many people are making.
QUESTION: What are a few examples of what companies are doing right to make customers
lives easier?
Newell: In the book, I talk about Nat Sherman, the tobacconist. The company keeps track of
all its customers likes, dislikes and purchases, and knows so much about its customers that it
can serve them beautifully. The company knows when its time for customers to reorder. Their
reminder is online for them, their order form filled out, and all they have to do is just click it.
And the company literally does make customers lives easier. The reason for the loyalty is that
customers arent going to bother to teach somebody else everthing theyve already taught Nat
Sherman.
Many, many businesses now are collecting data, but they dont know what to do with it, or if
they know what to do with it, theyre not doing it. And that includes most of the dotcoms and
most of the supermarkets in North America. Some of the supermarkets in Europe and the
United Kingdom are doing excellent work with this. If Tesco [a supermarket chain in the United
Kingdom] does a 5 million mailing, it will have five different magazines based on peoples
interests. Within each version, there will be 100,000 totally different cover letters addressing
specific interests of the customers.
QUESTION: Why shouldnt a company try to build relationships with all its customers? Why is
it important to focus on certain groups?
Newell: Because some customers are just cherry pickers. They come in for low prices, and
when the discount goes away, they go away. So you want to find out which customers are
profitable and invest your efforts with them. Take the money you were spending in trying to
reach everybody and wasting on that bottom group, and youll be able to afford more
communication with your best customers.
QUESTION: What are some ways a company can use the Web to develop customer
relationships?
Newell: First, theyve got to get e-mail addresses, which not many companies have done yet.
And in the process of getting them, theyve got to get approval to send e-mails to customers
because customers dont want any more spam. Once you get that information, its quick and
easy and near zero cost to send out thousands of very specific, personalized messages. And I
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think thats the secret. If youre using e-mail, it has to be very, very personalized.
If you get in the e-mail game and are asking people to reply to you, youd better be able to
handle the replies because people dont want it next week or next day. They want it right now.
And not too many people are well staffed to do that, though some are outsourcing it very well.
So its a different ball game.
QUESTION: How are customer relationship management and the Web changing brick-andmortar businesses?
Newell: The fact is that customers have the power now because they have so much more
information. But I dont think its the end of brick-and-mortar businesses. I read the other day
that 63 percent of people shopping online get their research and information online and then
go buy at a brick-and-mortar location. So I actually think that brick-and-mortar companies, in
the long run, will do better than the pure dotcoms. The multichannel is going to be the answer,
although I think they have to understand that theres a lot more to the Web than just selling
merchandise. E-commerce is fine, but e-service and e-information is just as important.
Customers value information highly, and the smart retailer, whether pure dotcom or brick-andmortar, is going to use the Web as a communication tool more than just as an e-commerce
selling tool.

8.3.

ENDORSEMENTS: Jump-start sales the simple waywith endorsements

Make Em Talk
Daniel Henry, 37, has what most would consider a perfect product: a kit that can fix damaged
CDs in less than one minute. Wipe Out!, Henrys CD repair kit, costs $14.99 and works on 40
CDs, saving consumers anywhere from $12.95 for new music CDs to $100 for high-end
computer programs. Since CDs are made from a plastic thats easily scratched, Wipe Out!
seemed primed to take off in the market. But overnight success didnt develop when the product
was introduced in 1996.
Henrys Esprit Development Corp., based in Long Beach, California, was finally able to push its
sales over $400,000 in 1999. The turnaround: Henry lifted sales with a private-label agreement
with Radio-Shack, as well as a presence in major retail outlets like Borders Books, Sam Goody
and Tower Records. This year, the company is finally gaining the momentum Henry originally
expected. What turned the company into a budding success? Raving testimonials in dozens of
magazines declaring Wipe Out! as technologys latest miracle product.

The Struggle Towards Marketing His Invention

In 1989, Henry was riding in the car when one of his friends CDs suddenly started skipping.
The friend was about to toss the CD when Henry, then an optical shop employee, offered to fix
it. Successfully polishing that scratched CD with optical gear, Henry came upon the idea for a
quick and easy repair kit for CDs.
He spent the next several years developing an easy-to-use chemical formula and, after
receiving his patent in 1997, Henry teamed up with four partnersJames Black, Paul Dragos,
Marc Guest and David Storyto introduce the product to the market.
But sales started with a big thud for two major reasons. The first: The public didnt know CDs
were reparable. Unlike records, music isnt recorded on the surface of a CD; instead, the digital
data is protected by a clear layer, the part of the CD that actually gets scratched. The laser that
actually reads the digital data cant read through scratches. But if you remove the scratch, the
CD is a good as new. Unfortunately for Henry, many believed, and still do, that they distort the
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digital data when they scratch a disc and simply throw it away. Consequently, retail stores didnt
see a demand from consumers for CD repair products.
The second obstacle: There were already CD repair products on the market sold by companies
that had full product lines, so it was easier for stores to buy from their current suppliers.
Another problem with the competing products was that, according to Henry, people who used
them didnt get the results they wanted. People didnt believe Henrys product worked better so
they didnt try it out.
Henry faced a difficult mission: to show his chemical kit was unique, when all the consumer saw
was a bottle that looked the same as any other. And he had to show people just how well his
product works without the benefit of a demonstration.
Pitching His Way To Success

Henry and his partners first overcame their tough breaks by securing the URL
www.cdrepair.com. This site helped Henry pick up foreign distributors and generate direct
orders from consumers searching the Web.
Then, in 1997, after the launching of the Web site, Henry and his team started sending samples
out to various magazine editors and columnists asking them to try the product. The first key
was finding the right people to approach. The partners picked up magazines related to either
electronics or music and looked up the names of editors or columnists who regularly reviewed
new products.
At first, Henry found pitching to editors was as tough as selling to retailers. "No one wanted to
be the first to write about the product," he says. But, after the first article about Wipe Out! was
published, stories appeared in Smart Computing and PC World, as well as Yahoo! and The
Dallas Morning News.
"The magazine testimonials meant everything to us," says Henry. "They told people our product
actually worked and helped us convince retailers our product was actually better than what
they were selling. It helped us get into the stores." Henry also used the testimonials as backup
when his team exhibited at the 1998, 1999 and 2000 Consumer Electronic Shows.
These simple, low-cost approaches provided Henry with an invaluable solution to his obstacles.
From the publicity, he received the essentials for an inventor's success: credibility and
believability among users and retailers.

The Power Of Testimonies

If your product isnt one thats likely to get endorsements from magazines, try getting
testimonials directly from customers. Some companies give products to industry experts or
university researchers free in return for reports or testimonials on the use of the product.
Sporting goods companies often call attention to their products by giving them away to pro
athletes in return for the free publicity.
The secret of using solid testimonials is to provide enough information to make the report
meaningful to the customer. I once worked with a new product that increased the life of
cutting tools. We started with customers reports that tool life increased by 25 to 80 percent.
But that information alone was too vague to impress our prospects. Prospects started paying
attention when we started publicizing more details, including the type of material being
machined, the speed of the product and the amount of material removed. Prospects
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suddenly had a reference point they could understand.
The same principle applies to consumer products. A claim that a food processor cuts cooking
time by 20 percent isnt that meaningful. A mother of four reporting that the food processor
cuts the time of chopping vegetables for beef stew by 70 percent is much more meaningful.

8.4.

Reach the Masses With Radio Advertising

In the car, at home, at the beach: Find customers wherever they are by
advertising on the radio.

Q: I read that in my county, some people listen to radio as much as five to seven hours a day.
What's the best way to use radio to market my business?
A: If you're thinking about using radio advertising, you're in good company. Advertisers spent
close to $20 billion on radio in 2000--and even during the 9/11 crisis last year, radio never fell
victim to the slump experienced by print and other media. You can buy radio locally, regionally
or nationally, depending on the audience you're trying to reach. And you can use radio quite
effectively to target specific ethnic groups, select demographics (young men, age 18 to 34, for
example), or people with interests in common, such as soccer fans.
The results you get from your radio campaign will depend on at least two factors: creating
appealing and effective spots, and making an effective media buy. To accomplish both, stick to
the following guidelines.
Hire Production Pros
Radio spot production is not a do-it-yourself job, so you'll need an agency or production
company that has experience creating spots that motivate members of your target audience or
expertise in marketing your type of product or service. Above all, the spots produced should be
appropriate to the target audience and what's being sold.
Sixty-second spots are still the norm in radio, unlike TV, where :30s predominate. And whether
you take a lighthearted or reverent tone, your spots must be evocative and engaging, using
music, sound effects and dialogue to create "word pictures" that involve the listeners. If you're
advertising in a small market or where the personality of the on-air talent on a particular station
lends interest or credibility to your message, you may choose to use announcer-read spots and
have the station do the copywriting for you.
How to Buy Time
Here are four steps to take when buying time for your radio campaign.
1. Identify a narrow demographic target audience and their important characteristics or
habits. For example: women, 25 to 54, with children under age 6, who reside in a specific
geographic market area.
2. Contact the stations you believe reach your target audience, and ask them to provide
you with proposals that include a ratings breakdown for your target group and a signal
coverage map.
3. Evaluate each station's proposal, looking for reach, frequency and cost per point. The
"reach" is the number of individuals in your target group who will hear your marketing
message. "Frequency" isn't the number of times that you run your spot; it's the number
of times a member of your target audience will actually hear your message. And the "cost
per rating point" (CPP) is the cost to reach 1 percent of your target audience population.
Also, the bulk of your spots should run in dayparts that draw the largest percentage of
your prospects, not run-of-station (ROS), which may include multiple, lower-cost spots
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that air in the middle of the night, when fewer of your prospects will be listening.
4. Select the best stations for your campaign, and negotiate your buys. Make frequency
your top priority, and then include as much reach as you can afford. In other words, it
takes multiple exposures for your message to be effective, so make sure a core prospect
group will hear your spot multiple times, then buy as many additional prospect contacts
as possible.
Tips for Getting Noticed
Consider buying sponsorships--such as news, weather or traffic--because you'll receive the first
spot in the commercial break and often a five- to 10-second "billboard" to say something about
your company. Participating in contests will also get you lots of on-air mentions. So contact each
station's promotions director for upcoming events.

8.5.

Speak Up!
Done correctly, seminars can increase your company's visibility--and
even ring up sales.

Anyone who's attended an interesting and informative seminar knows it can be one of the best
ways to train staff, keep yourself up-to-date on industry changes and learn new skills. On the
flip side, seminars are also a powerful way to build awareness of your company, market your
products or services, and possibly create a new revenue stream for your business. Whatever
type of business you're in, you probably have knowledge and expertise that others would find
helpful--and that might encourage them to use your services. Follow this checklist to make
your seminars great:
Fee or free? When determining what or if to charge for your seminar, consider two rules of
thumb: 1) Most people will attend events for which they've already paid in advance, and 2) the
more you charge, the less overt selling you should do. If your seminar is held primarily to
showcase your expertise, you can charge higher fees. However, if you're trying to create an
environment in which to sell your product or service, you need to charge less or waive the fee.
In either case, make sure you deliver timely, interesting and worthwhile content.
Partner up. Consider defraying your costs by teaming up with another business that's
related to yours. For example, an attorney and an accountant could deliver an informative
small-business start-up seminar to attract new clients for both of them.
Check your date. Do some homework before you schedule your seminar to avoid
competing with other events that could reduce your attendance. Call around to other facilities
and find out what they have planned for that day, and check with your colleagues to see if
there are any industry events at the same time.
Minimarketing. Create a concise marketing plan for your seminar. Include publicity, direct
mail, advertising and other appropriate promotional vehicles. Remember, the more you get the
word out, the more people will attend your seminar.
Oh, won't you stay? Before you determine the length of your seminar, consider your
audience, your topic and other related factors. If you're planning to speak to a room full of
accountants, don't schedule a half-day seminar during tax season. Conversely, if you have a
lengthy, complex topic to discuss, don't try to cram it into a two-hour luncheon.
Where it's at. Most hotels and conference centers routinely host seminars and have the
process down to a science. If your budget won't allow for such accommodations, check out
renting space at a local college or training facility.
Require an RSVP. Advance registration gives you a good idea of how many people to
expect and how many handouts you'll need. Always ask how the registrant heard about the
seminar so you can track your marketing results.
Provide good handouts. Handouts are one of the most overlooked tools in seminar
marketing. Give your attendees professional-looking materials that support key points in your
presentation.
Don't be understaffed. Be sure you have enough staff at the event to handle registration,
last-minute errands, product sales, distribution of handouts and other event essentials.
Capture your attendees. Be sure you obtain names, postal and e-mail addresses, and
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other important contact information from your attendees for follow-up purposes. You may also
wish to develop an evaluation form to distribute and collect to help you make your seminar
even better next time around.
9.

HOW TO MAKE A WINNING BROCHURE

9.1. A Surefire Way to Get Your Brochures Read

Your company spends thousands of dollars a year on the creation, printing and mailing of brochures to
help your sales efforts.
Before you send out your next brochure/letter, read the following tip. It will pay off for you in
increased sales, and save your company thousands of dollarssome of which just might find its way into
your pockets.
This is what happens to most sales brochures:
Ordinarily, your sales letter and brochure is opened by a secretary for the decision maker. It is her job to
screen out sales materials and allow only important correspondence to get through. The rest is trashed or
routed to non-decision making subordinates.
Make your letter important
In order to eliminate the chance that the secretary will trash or re-route your brochure/letter, and to make
sure that it gets in the hands of the intended decision maker, do the following:
DIRECTIONS:
Attach a post-it-note to the front of the letter. Write the following:
(Prospect's Name),
Here is your reference
number: #356821
also, see highlights.

Why does this work?

When the secretary sees this note, she'll think that this is an important number that the boss has been
waiting for. How is she to know that it is just an internal file number? To her, this is an irreplaceable
number that must be passed through.
How do we get the decision maker to read the brochure?
That's where the highlights come in. When we wrote "see highlights" on the post-it-note, the prospect is
forced out of curiosity to at least take a peek. Note. It is important that you only highlight a few key
sentences that must include the benefits that are important to your prospect. If the benefits are
enticing enough, he'll call you back, or at least be more receptive to your future calls.
How can I make a better brochure?
If your sales letter or brochure doesn't ooze with benefits for your prospects, you're dead in the water.
Ask your marketing director or president to contact an advertising agency to create a brochure that will
SELL.

9.2. Sales Materials That Shine

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Want to really impress your prospect and give him sales materials that will make him want to order now?
Follow these five important sales secrets.
1. Target your material toward a specific audience. These days, it's not possible to understand and
meet the needs of every potential custom.er. Show you are a specialist, Bly urges. "You have a selling
advantage and come across as believable when your sales materials are tightly targeted to specific
audiences," he explains. "Say you offer 'accounting services for advertising agencies,' not just 'accounting
services.' "
2. Use testimonials. People might not believe your product or service can do what you say it will. You
can overcome this disbelief by having a past or present customer praise you and your company.
Testimonials are usually written in the customer's own words, are surrounded by quotation marks, and are
attributed to the individual. They can be used in sales letters, brochures and advertisements.
3. Write from the customer's point of view. "Start your copy with something that engages the
prospect," Bly suggests, "and what most people are interested in is themselves." If an insurance agency
wanted to introduce its new employee health-benefit program for small-business owners, it might be
tempted to state the obvious, using the phrase, "Introducing our Guarda-Health Employee Benefit Plan."
The agency would get better results if it wrote something that directly interests the prospect: "Are the
skyrocketing costs of your insurance premiums threatening to put your company out of business?" As Bly
explains, "That's something business owners who provide benefits to their employees can relate to."
4. Use questions. A great way to engage your prospect is to pose questions in the headlines of your
sales literature. "Every car-wash owner should know these seven business-success secrets. Do you?" Or,
"Why haven't satellite-dish owners been told these facts?"
5. Turn a negative into a positive. If you are new in business and haven't sold many products or
signed up many clients for your services, don't despair. You can phrase your situation this way: "Not one
widget buyer in a thousand has ever experienced the advantages of this new XYZ widget design."
EXAMPLE.
I had formerly been a teacher and had done corporate training before I started my own company that
designs custom-tailored sales-training systems for corporations. The first four months, I had no clients. I
told myself to practice what I preached: "The next sales call, I'm not going to mention my product until
the meeting is over. I'm going to build rapport and spend time on the client's needs so I can position my
product." I braced myself and did it. At the end of the meeting, the man said, "You knocked my socks off.
When do we start?" The major difference was in asking for the client's needs, probing deeper and deeper,
and really understanding what the organization was about, what they wanted to achieve and why.

10.

10.1.

DONT DO IT!

4 Marketing moves not to make.

Planning a hot new marketing program for 2002? Sometimes, even with the help of a qualified
agency, what may at first look like brilliant marketing moves can actually be big mistakes.
Here's how to avoid four marketing blunders that can torpedo your best-laid plans.
1. The Wrong Message
One of the most imaginative TV commercials of the year ran during the Super Bowl. Dubbed
"Running With the Squirrels," it was a parody of the running of the bulls through the streets of
Pamplona, Spain, but instead of angry bulls, hundreds of squirrels chased runners through the
ancient city. Unfortunately, the $6 million spot from EDS did little more than entertain, because

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most viewers were left puzzling about what was being sold.
You can avoid this problem by making sure customers receive enough information from your
ads to understand what you sell as well as why and how they should buy it.
2. Forgetting the Benefits
Just as an obscure message can bury your chances for positive results, by neglecting to
explain how your products are useful, you run the risk of turning customers off. For instance,
suppose an investment brokerage firm in Seattle creates a direct-mail campaign targeting
entrepreneurs statewide. In an effort to impress recipients with the company's scope and
ability to compete with national firms, the direct-mail copy lists the range of products offered
instead of how those products will benefit the ad's target audience. Big mistake.
Prospects and customers look at your marketing materials with one question in mind: "What's
in it for me?" So make sure your materials put benefits front and center.
3. Aiming Too Wide
Focus is vital for businesses. Unfortunately, many entrepreneurs try to hit too many targets
and thereby increase their marketing risks. Imagine you own a company that sells handmade
hair accessories to gift shops nationwide. Your marketing program includes print advertising in
trade publications and at trade shows for gift shop owners, catalog mailings to customers, and
direct mail to prospects followed by phone calls from your sales staff.
To increase sales, you could either market your current line to women's clothing boutiques or
expand your current target audience. Both choices involve risk, but taking on a new target
audience would require additional advertising, direct mail and trade shows that could dilute
your budget and drain your staff. On the other hand, adding a new product line for your
current audience could enhance sales without as much financial outlay or risk.
4. Same Ol', Same Ol'
If you really want to ensure success in the coming year, climb out of your marketing rut. If
you've simply been mailing a catalog four times a year or relying purely on trade shows, make
2002 the year you break out and reach customers through additional, more innovative
marketing methods. Figure out where and when your customers will be receptive to your
message, then put tactics in place to make multiple contacts with them year-round.

10.2.

When Your Marketing Materials Flop

. . . go back to the drawing board and do some research to find your best
prospects.

Q: I've started a video surveillance business, and I've been focusing on retail stores. I
recently handed out 550 fliers describing my products and prices, without one reply. We've
also done 1,000 phone calls, followed up by a free estimate, which sold just five systems for a
profit of $3,000 in 60 days. Do you have any marketing tips for us to increase our sales? We
think there's a big market for this business in our area.
A: Like many entrepreneurs, you may have launched your business based on a "feeling" that
there's a big market, without necessarily making sure one exists. What you need is concrete
data. Decide what constitutes a good prospectis it their size, revenue or location? How
many stores that fit your criteria have no video systems in place and can afford to buy one in
your price range? Are you facing entrenched competition or perhaps a completely saturated
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market? Without this information, you're simply marketing in the dark.
So before you do anything else, it would be smart to hire a research firm to conduct a
telephone survey of your retail prospects. You should also perform a competitive analysis by
gathering your competitors' marketing materials. Use them to evaluate your pricing and the
ways your company adds valueadditional services, products or featuresthat can help you
stand out. Then come up with distinct benefits you can use to position yourself against your
competitors in sales calls and marketing materials.
Your most important goal should be to meet with qualified prospectsthe ones your research
tells you will be receptive to your message. Instead of passing out fliers, which can detract
from an otherwise quality image, create color brochures to use in meetings. While your
telemarketing program has yielded marginal results, you may see a higher return once you
refine the list based on your research data. Your low conversion rate may also be due to
underdeveloped telemarketing skills or a faulty script. Consider hiring a telemarketing
company to help you overcome these difficulties and increase the number of appointments
scheduled. And don't overlook networking at business and professional functionsthey're
terrific places to meet retail prospects.
Great customer service that leads to positive word-of-mouth will also play an important role.
For each of the five systems your company has sold, ask for referrals and solicit customer
feedback you can quote in your marketing materials. While building relationships with the
right prospects and customers takes time, it's the best way to lay a solid foundation for sales.

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11.

LEARN TO MAKE PROFESSIONAL MAILING LISTS

12.1.Building an Effective Mailing List

To get your direct-mail message across, you have to start out with the right
names.
Q: How do I go about finding the right mailing lists that target my customers?
A: Much depends on the specifics of who your customers are and whether you're targeting
businesses or consumers. But, generally speaking, here are nine avenues for you to explore to
get you started in the right direction.
1. Trade associations: What trade associations do your prospects belong to? Say, for
example, you want to reach professional speakers. In this case, you'd contact the National
Speakers Association and ask to rent or purchase a mailing list comprised of its members.
2. Local chamber of commerce: This makes sense if you're selling to local businesses. Most
chambers of commerce sell a member directory or offer the directory as part of their
membership package.
3. Internet directories: Do a Google search (at www.google.com). For example, I do a lot of
work with PR and ad agencies across the country. To find qualified prospects, I recently
conducted a Google search on "PR agency directories." One of the search results was Agency
ComPile (www.agencycompile.com), which has more than 1,000 agencies in its database,
indexed according to various categories. This site has been an invaluable research and listbuilding tool for me--and it's FREE. Perhaps there's a useful directory on the Web that features
your target customers.
4. Magazines and trade journals: Magazine and trade journal publishers usually have a list
manager, who handles orders for the mailing list. Therefore, if you know that subscribers to
Men's Health Magazine, for example, are likely to be good prospects for your product, then you
can rent their subscriber list directly.
5. Community newspapers: This approach makes sense if you're targeting local consumers
as opposed to local businesses. Just as with magazines and trade journals, call the community
paper and ask for the person in charge of mailing list rentals.
6. Homeowner associations: Say you want to target your mailing to local upscale
consumers who live in homes valued at $300,000 and higher. A good place to begin is to scout
the neighborhoods that fit your profile and then find out which associations manage those
subdivisions.
7. Building your own list: How do you build your own contact list? Anytime you meet people
who fit your customer profile, put their information in your database. If you find qualified
prospects through your Internet research, add them to your list. Or if you've purchased a
directory from the chamber of commerce or trade associations, include those contacts. Over
time, you may find that you've built a database extensive enough that other businesses would
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want to rent your mailing list.

13.1.

13.MARKETING TIPS.
Using testimonials to unleash the power of the second opinion.

If you've ever watched the Home Shopping Network or seen an infomercial, then you know
about the power of testimonials. In my experience, there's an instantaneous increase in the
number of sales when real customers are seen or heard testifying as to how beneficial a
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product has been for them. It helps potential customers clearly imagine themselves as proud
owners of that product, experiencing the very same benefits as the person who made the
honest testimonial.
The best way to get prospective clients to buy from you is to introduce them to other satisfied
customers. Because you can't drag your best customers around with you on all your sales calls,
testimonials can take their place. Luckily, you don't have to be on a shopping network or in an
expensive infomercial to use testimonials to your advantage.
Ask your best customers whether you can interview them about the positive experiences
they've had with your product and company, and record it with a video or digital camera. You
can then load the videos onto your laptop and, with just the click of a mouse, play them back
for prospective customers.
For example, maybe you know of some situation where the cost of
A picture of a happy your product was initially an issue for a particular customer, who
customer is worth a decided to buy instead from a lower-priced competitor. But then,
thousand
impersonal after discovering that the selected vendor wouldn't be able to
deliver, the customer came back to do business with you. The
sales brochures.
customer had realized that the lower price he or she paid in the
short run would actually cost more in the long run, and the value
you provide in quality and service is more than worth the extra money.
That's the perfect kind of customer to give you a testimonial. Then, should you run into
another prospect with similar concerns, you can say, "I understand how you feel, and other
customers have felt that way, too. In fact, here are some comments from a customer who had
the same concerns as you do now." You can then open your laptop and play the testimonial for
the prospect.
Ask your contented customers to talk about the benefits they've received from using your
product or service. If you have a number of different testimonials, you can always use the one
that best fits the sales scenario in which you find yourself. One particular rep I know takes
pictures of customers using his product. A picture of a happy, satisfied customer is worth a
thousand impersonal sales brochures.
Truth sells-and you can't get closer to the truth than when it comes from someone who's had a
real-life experience with you, your product and your company.

13.2.

Successful marketing takes more than a monster budget

It happens every single day: Two businesses with similar marketing budgets conduct extensive
direct-mail campaigns. While one of the companies realizes only less than a 1 percent increase
in sales, the other somehow manages a 20 percent increase and then turns each one of those
newly acquired accounts into a loyal, repeat customer.
Why do some companies succeed brilliantly in their marketing efforts while others fail? Lets
face it, many entrepreneurs have access to the same tools and resources, but the ones who
succeed know how to pull them all together to make their marketing work. Heres a look at the
nine elements at the heart of true marketing success:
1. Leadership: To be successful, the marketing programs your staff or agency creates must
support your vision of your companys future. Its up to you, at the top of your organization, to
set the tone and clearly define your goals. How can your marketing team meet your
expectations if its unclear what they are?
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2. Listening: Customers will tell you what they want, need and are willing to pay for. Theyll
even tell you which marketing approach they prefer. You just have to ask themand listen
carefully to the answers. Whether you use focus groups, surveys, Web feedback or polls, the
best marketing programs are those that are shaped and molded by customers preferences.
3. Teamwork: Effective marketing doesnt begin and end with you and your marketing
people. Everyone in the company, from the receptionist to technicians or plant workers, can
produce referrals, positive PR and even sales. The key is to enroll your entire staff by
soliciting their ideas, sharing your plans for each new marketing effort and keeping the team
up-to-date on your progress.
4. Coordination: The best marketing programs cant succeed if there are barriers to sales.
Anything from out-of-stock products and pricing glitches to delivery problems and uninformed
personnel can stop a deal. The prerequisite for effective coordination and removal of sales
barriers is open communication between all departments and individuals, so things like
shortages can be anticipated and discussed, and your personnel can support rather than hinder
one another.
5. Focus: Unlike major corporations, where divisions compete for their piece of the marketing
pie, your growing business has the luxury of focusing intently on marketing its products and
services to narrowly defined audiences. Failure to focus by taking on too many different target
markets can diffuse your effortsreducing the time and budget available to effectively
penetrate each oneand sabotage your results.
6. Accountability: Just as the Great Pyramids were constructed one stone on top of the next,
one successful marketing program builds on another. It all hinges on tracking and measuring
your marketing results. Start by setting quantifiable goals for every program or tactic, such as
to produce three new accounts in 60 days. Test and examine each marketing approach and
then reproduce what works.
7. Flexibility: Successful companies respond quickly to changes in the marketplace, customer
preferences and new technologies. When a marketing tactic stops working, dont wait months
to make revisions. Investigate the problem and eliminate it fast!
8. Continuity: Consistent presentation of a brand name and image are essential to long-term
marketing success. While strategies and tactics may change and evolve, names, logos and
even slogans should be considered the bedrock on which the foundation of your companys
marketing program is built.
9. Insight: Some entrepreneurs always seem to have the inside track. They evaluate the
competition and forecast future trends, new products and technologies instead of just
responding to todays ups and downs. Being a great marketer means staying ahead of the
pack. You dont really need a crystal ballit should just look like you use one.

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