A few weeks ago a good friend of mine that is starting up a new professional services firm asked me to have lunch with him to talk about what he would need to focus on to be successful in our town. Here is the exact memo I sent to him and I think that much of it applies to just about any business and /or any individual trying to separate themselves from the rest of the market – especially a local market. Take a look through my suggestions and see which ones might work for you and your organization.

1) Figure out exactly who your key target customers are – the part of the market you want to own, that is the most profitable, and where your services will have the most value… as defined by the CUSTOMER… who is the only person who can decide what is valuable and what THEY are willing to pay for.

2) Create a very detailed “Ideal Customer Profile” to help you understand and stay focused on the people who will truly make your business successful

3) Determine who your top competitors will be for those specific target customers, who is already servicing them right now?

4) Study those top competitors, who are currently servicing the customers you want to win, to deeply understand how they position themselves – what services they offer – what promises they make – what sort of value proposition they are currently bringing to the marketplace that is, for some important reason, winning over the customers that you want to win away from them.

5) Figure out how to clearly differentiate yourself from your competitors in a way that will raise the bar and recalibrate the customer’s expectations, and be sure that the way you differentiate yourself is of true of value to your customer, as defined by the customer, not by you.

6) Create strategic alliances with people in town who, by the nature of the business they are in, can become wonderful sources of referrals to you. You want to get as many people like this on your team as possible… but you especially want to identify the top four or five “Opinion Leaders” who are the most influential sources of referrals for you so that you can get these very important individuals on your team and creating a constant stream of high-quality, targeted referrals that represent your Ideal Customer Profile.

7) Also determined people who are in your direct area of competition – but that you do not want to compete against, and try to form strategic alliances with them so you can work together and be in co-opition instead of competition.

8 ) Identify your key “Moments Of Truth” — the handful of key things that absolutely have to go right in order for you to be able to meet and exceed your customers expectation –  and create processes to make sure that they are delivered flawlessly — flawlessly – – – every single time.

9) Establish a brand for yourself and oyur business that represents a completely new level of service and changes the game in your competitive environment.

10) Position yourself as an expert, trusted advisor, partner and peer to your customers by continuously delivering them REAL value and assistance in making their businesses better and more successful — by making them look really good and delivering massive value to their customers.

11) Be sure that every single time you do a superior job – and your customers tell you that you are fantastic – follow up instantly with a request for referrals. If they say you’re awesome, thank you, thank you, thank you… tell them that the very best way they can thank you is to tell 10 other people about how fantastic you are and strongly recommend that they do business with you. Positive word-of-mouth through strong personal referrals, are the single most valuable advertising/marketing vehicle there is on the face of the earth. You can pay hundreds of thousands of dollars to buy ads in every magazine, website and newspaprer in the world – but a handful of strong personal for referrals from key opinion leaders will drive much more business than those as ever could.

12) Keep track of your best customers. Check in with them regularly – talk with them – ask questions and LISTEN. The best way to grow your business is to determine who your very best customers are – and turn them into your marketing department. Deliver GREAT products and service to them and get them to help you find more customers just like them – and understand the needs of those customers better than any of your competition.

13) Once you figure out what works best for you – what truly leads to gaining real market share and significantly increasing profitability – focus like crazy on that area and get better and better at it every day.

 I hope you found some of these ideas helpful. As always, I look forward to your feedback, ideas, comments and suggestions. Thanks so much — John

And I hope that everyone reading this benefits from it as much as I have.  ~ Jim

1. We’re losing money on every sale, but making it up in volume. If we run deals at deep discounts or even a loss with the intent of creating exposure or capturing new customers, we need to consider what impact the increased volume and reduced margins will have.  Remember, a businesses is an interconnected web of causation.  We can’t increase lead generation and conversion without influencing other areas.  So, we need to ferret out these impacts and make sure that, on balance, our great group deal will translate into great results.
2. Look we’ve sold 1000 (wow!)… 10,000 (uh oh!)… 100,000 (gulp!) deals. More is not always better and selling too many deals at once can ruin a small company.  We need to think carefully about what sort of volume we can handle and limit the number of available deals to something manageable.  In the same vein, we need to give careful thought to when our deal expires.
3. Hey we just doubled our customers on this deal… or did we? Well, that depends on what type of customers we’re targeting.  My favorite are the evangelical, repeat kind — those who shouts our praises from the rooftops and uses our products and/or services whenever they can.  Will the customers clamoring for our $50 deal stay customers when they have to pay $100 for the same products or service?  Will they be raving fans to other ideal customers?
4. Let the deals flow (our operations are scalable, right?). If 500 customers take us up on our deal and want fulfillment within the next three weeks, can we accomodate them?  If so, will the quality of what we provide remain consistent?  While satisfied deal takers may not build our business the way we expect (see previous item), dissatisfied ones will almost certainly have a negative impact.
5. Our existing customers just love us, so the deal takers will, too. Again, deal takers may not be as similar to our existing customers as we might like to think.  We need to have systems in place, prior to deal execution, that elicit feedback from deal takers and allow us to compare with feedback from existing customers (we do have feedback from existing customer’s, right?).  Similarly,we need to make sure that we have a plan for maintaining a relationship with this influx of new customers.
6. Hey, someone mentioned existing customers.  Yea, what about those guys? When we launch such initiatives designed to quickly build our customer base (our eyes are apt to fill with visions of deals and dollar signs), meanwhile, there’s a real risk of hurting or alienating our existing customers.  If fulfilling these deals is going to impact our ability to service current customers, or leave them feeling mistreated since others are getting an amazing deal that they didn’t, we need to carefully consider and address these issues before we execute the deal.

Again, I am not against group deals as a rule, simply concerned that for many businesses, the consequences of success may not be fully understood or adequately anticipated.

That’s what I think, what do you think?  Have you run a deal?  If so, what were the positive and negative impacts to your business?  If you’re just thinking about running a deal, what are your motivations and reservations?  Please post your comments below.

- Archbishop Temple

I frequently find that the best business wisdom isn’t.  That’s because wisdom, regardless of where it originates, tends to have broad application.

In that vein, I was struck a few years back by the insight in this quote by Archbishop Temple, which places the spirit and caliber of our earnest effort over the ends for which we strive.  Shouldn’t we be thinking about business this way?

Riding the Archbishop’s coattails, we might say:  

The right relationship between continuous improvements and results is not that results are supremely important and continuous improvements may help them, but that continuous improvements are supremely important and results test them.

Viewed this way, results are merely the litmus test of the quality and effectiveness of our continuous improvement efforts. This may not seem revelatory if you are part of the quality crowd, but in my experience it is not the predominant view held in business.  We hear individuals described as results-oriented, but how often are they said to be improvement-oriented or growth-oriented?

The implementation of defined retrospective loops, where we inspect our practices and adapt based on our outcomes is something that we tend to forgo, believing that it is takes time and effort away from the business of achieving results.  But, investing our energies in relevant personal and organizational improvement, learning, and growth does not detract from our ability to produce.  Rather, these activities enrich us as individuals and organizations, while enabling more effective production and higher quality output.  Perhaps that’s why W. Edwards Deming, the famous statistician and business consultant, stated “Learning is not compulsory… neither is survival.”

Finally, while this “paradigm shift” is wholly justified by it’s ability to enhance our returns, it appeals to me for one additional reason.  It further humanizes business by compelling us to focus on activities that support our self-actualization.  Talk about  a win-win.

- Herr Hunt, my third grade German teacher

When I was in third grade, my teacher invited a guest instructor, Herr Hunt, to come in for a few weeks and teach us a bit about Germany and the German language.  While I’ve forgotten most everything from that experience, save how to count to twenty in German, there was one comment made by our instructor which has never left me.

Whenever Herr Hunt would see that we were afraid to answer a question, he would say, “A man who never makes a mistake never makes anything.”

You mean that it’s OK to make mistakes?

Wait…Wait… You’re not just saying mistakes are OK, you’re saying they’re necessary?

The idea was a revelation, and ultimately a valuable counterbalance to my already overdeveloped perfectionist tendencies.  Yes, even at that tender age.

You don’t have to be a recovering perfectionist, like me, to have been tainted with our society’s pervasive contempt for mistakes.  How often has your significant other commended you for a mistake?  How frequently have you witnessed a grade raised or bonus increased on the grounds of a mistake?

Don’t get me wrong.  I’m not saying that we necessarily have to reward mistakes, but in our culture we are on the other end of the spectrum.  We seem to be at war with mistakes, and in that war we are largely unaware of the collateral damage to innovation, learning, and our ability to improve.  Fear of making mistakes stifles our collective creativity, risk taking and, ultimately, our growth.

As business owners and leaders, we have a responsibility to our businesses and our stakeholders to maximize value.  Doing so means getting the most out of each relationship.  One way to quickly add value to our organizations is to normalize our perception of mistakes, by turning them into tools for learning and growth.

I suggest starting with:

• Education – Raise awareness as to the vital role mistakes play in achieving successful outcomes.  From idea generation and selection to planning and implementation we must leverage our mistakes to reach desired outcomes.
• Encouragement – Encourage communication and acceptance of mistakes.  Remove any stigma of shame associated with mistakes, get them out into the light of day and encourage everyone to learn from them.
• Integration – Integrate acceptance of mistakes into your processes.  When brainstorming, value all ideas regardless of which you pursue.  When implementing, record and discuss blind alleys and wrong turns that you’ve made, as a way to share learning.
• Commitment – Don’t stop.  Many things that are simple, are not easy.  Old habits take time and repetition to eliminate.  Stay committed.
• Tempering – While we don’t want to demonize mistakes, we’re not trying to encourage a proliferation of mistakes for their own sake, either.  Rather than a culture of “make no mistakes” or one of “make lots of mistakes”, strive for a culture of “we embrace and learn from our mistakes”.  Redirect the energy spent condemning mistakes into energy dedicated to learning from them and codifying their lessons into your collective business knowledge, processes and wisdom.

Over the years I’ve come to realize that for those who can graciously accept their charity, nothing pays more handsomely than a mistake.  May you accept and prosper from yours.

If you want to learn how coaching can help you achieve top business performance, increase your personal satisfaction and achieve your dreams, please contact me for a Free One-Hour Strategy Session.

In it Bud shares a simple, but very insightful venn diagram that shows the overlaps between your business strengths (What We Do Well), satisfaction (What We Want To Do) and ability to earn (What We Can Be Paid To Do).  From the diagram, we can infer that if you hit the trifecta (meet all three criteria) – Hooray!  You’ve found the formula for business happiness – getting paid to do what you are both passionate about and excel at.  If, instead, you are only firing on two of these cylinders, Bud provides succinct advice on how to increase your happiness.

What I really like about the diagram is the obvious importance of the What We Want To Do piece.  As a business owner or leader your satisfaction, and that of your employees, requires that you be doing what you want to do.  While doing so does not guarantee business success, failing to do so guarantees consistent dissatisfaction and likely a failure to thrive.  Life is too short to not follow your passion.  Right?  Right!

This diagram really resonates with me because I’m committed to working with my coaching client to improve not just their business performance, but also their satisfaction both professionally and personally.  If you want to learn more about how business coaching can help you reach your potential and achieve your dreams, please contact me for a Free One-Hour Strategy Session.

Finally, mad kudos to Bud Caddell for boiling down many business books worth of insight and wisdom into a single, consize visual.

In his article, Mr. Bacal writes:

Here’s the bottom line for those in a hurry. Do NOT invest the time on twitter with the expectation that it will yield business results. If you want to participate because it’s fun, then do so. But don’t do it for business, because you’ll be disappointed now, and in the future.

While this is probably true for many small business owners, I tend to get nervous when I hear a blanket statement.  Without examining your particular business needs and marketing plan, I wouldn’t unilaterally cast Twitter out.

One Data Point – My Site

I’ve been experimenting with it as a means of driving traffic to my new website.  How successful has it been?

Well, so far 31% of my new website’s traffic has come from Twitter.  Having said that, the bounce rate for my Twitter traffic is 72%, while the pages per vist and average time on site stats are about half that of my direct hits and facebook referrals.  So, the Twitter traffic is coming, but they’re about half as committed as the rest of my traffic to stick around once they take a peak.

What does this mean for my Twitter experiment?  Well, for me, it means it’s not over…yet.  While my Twitter traffic is not sticky, it is still a significant portion of my overall site traffic.

Small Business Hope for Twitter?

Contrary to Mr. Bacal, I can imagine Twitter providing value for some small businesses.  For example, I know of one local business that occasionally distributes a dollar off coupon for Gelato via email;  if you mention the email, you get a break on the Gelato that week.  Is it possible that some subset of their customer base wouldn’t want to give out their email address, but would follow them  on Twitter?  How much more effort would it be for them to tweet their coupon in addition to sending it by email?  Would they get enough business to warrant the time?

In the end, I see Twitter as just another communication medium, albeit an immature one with a, currently, poor signal-to-noise ratio.  If you can find a way to get your message to the right audience via Twitter while achieving your desired ROI, by all means do so.    As is so often the case, it is ultimately about alignment.  If a technology, and what it provides, aligns with your business strategy and goals, use it.  Otherwise, concentrate your energy elsewhere.

I would be especially interested in hearing from any small business owners that are currently using Twitter as part of their business efforts.  What’s working for you?  What’s not?  I look forward to your comments.