What’s Your Shtick?
A shtick is a Yiddish word that means your gimmick or unique talent. In the business world they call this your USP, Unique Selling Proposition. Essentially, what makes you different from your competition? What do you have to offer that they don’t? For example, a freelance writer might differentiate themselves by delivering any article or blog post project in 24 hours – the 24-Hour Article Service.
Narrow Your Focus
Trying to be all things to all people does one thing – it increases your competition. Specializing, on the other hand, narrows your competition. It also helps you become the best at what you do. For example, instead of offering information products on how to care for your pet, you might specialize in how to care for your aging dog. Or how to care for your aging Pomeranian. Specialization can virtually eliminate your competition.
Become Invaluable
Offer products, information, and resources that make you invaluable to your audience. When planning your business, ask yourself this single question – what can I do to offer more value to my audience? Of course, you have to know your audience well to answer this question.
Be Memorable
You cannot be boring in this competitive market and survive. Now that doesn’t mean you have to be over the top either. Instead, be yourself. Capture the interest of your audience and customers by sharing your personality with them in your content, interactions, and even in your products or services.
Pay Attention to Your Customers
Chances are you already have some very valuable information regarding what your customers respond to. Take a look at what they buy, when they buy, what emails they open and what links they click. This information will help you hone in on how to offer value and how to be memorable. It may also help you specialize.
Build a Community
Connect with your audience and customers on a regular basis. Invite them to get involved through a number of means. For example, invite them to connect with you on Facebook. Ask questions and invite comments.
Repeat Successes
Pay attention to what works for you and repeat it. For example, if you find that checklists are downloaded more than free reports you know that your audience enjoys checklists. If they buy more during the summer than in the winter then offer them more during the summer.
Staying ahead of your competition doesn’t just mean following their actions online and reacting to them. Instead, create a plan to be proactive. Differentiate yourself and focus on your customer. That’s how you’ll survive and thrive long term.
]]>Why?
1. The Very Basics: How Is Your Website Doing?
If you don’t even track the rudimentary things, such as how much traffic your website is getting, how many people are coming back to your website after leaving and other basic metrics, you’ll have no idea how your website is doing at all.
If your website is starting to get serious traffic, that means an opportunity to make money. If you don’t have tracking installed, you won’t know when that happens.
In addition to the basics, there are a lot of other benefits of tracking some of the more advanced metrics.
2. Using Metrics to Rank Well in Search Engines
With the Panda update, Google has publically stated that they’re using visitor metrics much more heavily now in their ranking algorithms.
That means that pages where people stay longer will tend to rank higher. Pages where users click and then never come back to Google also rank higher, as that probably means they found the answer to their question on your site. Pages which users don’t bounce from and instead go to other pages on your site will rank higher.
These are just a fraction of the metrics Google is now considering in their ranking algorithm. If you want your website to rank, you need to be consistently monitoring things like return rate, bounce rate and exit rate to improve them over time.
3. Tracking Performance to Immediately Improve Cashflow
Some metrics may not immediately improve your bottom line. Improvements in other metrics, however, can immediately improve your cashflow.
For example, what’s your current visitor to email sign-up rate? What’s your email to conversion rate?
By tracking these two metrics, you can immediately add more cash to your bottom line. More importantly, any improvements you make to these metrics will last over time, paying off for months and years.
4. Improving the Non-Tangibles of Your Business
How useful are people finding your website? How many people feel like your site is resourceful enough that they come back? How many people post things from your site to their Facebook status?
These are metrics that won’t necessarily add to your bottom line right away. However, they’ll result in more links, more visitors and more community goodwill. In the long run, that’ll turn into more visitors and more cash.
These are some of the many reasons you should be tracking the performance of your website. Without good tracking, you’re essentially flying blind. By tracking and measuring your metrics, you’ll be able to refine and improve your website over time.
]]>Let’s go into two of the most important elements behind the buying psychology: emotions and logic.
Buy on Emotions, Justify It with Logic
Does someone buy a Mercedes because it logically makes sense? No – they buy a Mercedes because of how they believe they’ll feel when they own the car. The luxurious feel. The envy from others. The sense of pride, of power.
Then they tell themselves: “I’m buying it because I need to impress clients.” Or “I’m buying it because if it helps me land just one deal, it’s almost paid for itself.”
The reality is, however, buying decisions are almost always made on desire. Only once a strong desire has made the decision, then logic is used to justify the buying decision.
How can you use this to your advantage?
First of all, perhaps the most important skill you can master as a marketer is the ability to create desire. If you can instill a sense of excitement, of urgency, of tangible desire to own your product in your potential customers, your ability to sell will go up dramatically.
The other thing to take away from this principle is how important it is to help lay out the logic your client needs to justify the purchase. If you can explain why they’ll make their money back from their investment, you make it much easier for them to give in to their desire to own the product.
The Importance of Believability
Marketers and salesmen often try to make huge claims. It’s almost as if they’re in a competition to see who can make a bigger claim that nobody believes.
The most important thing in getting people to buy isn’t making big claims. Instead, it’s getting believability.
If I could convince you that I could show you how to make an extra $2,000 a month for no additional effort, all it would cost you is $50 and you believed me 100%, how likely are you to say yes?
On the other hand, if I tried to convince you I could make you a million dollars and you didn’t believe me, how much would you pay me for that?
The most important thing really isn’t how big a claim you can make, but how big a claim you can make your customers believe.
Desire is built on claims people believe. If someone really believes their lives can be better, they’ll get excited. Logic is also built on claims they believe. If someone really believes that buying that new Mercedes is worth the investment, they’re much more likely to spend the money.
The psychology behind buying is in some ways simple. Get people to want your product and remove the logical reasons why they shouldn’t. It’s also a skill that can take a lifetime to master.
]]>The idea that the cyclical nature of the economy makes recessions a great time for entrepreneurs goes as follows; the economy runs in ups and downs. Right now it’s down, but it won’t be forever. It will recover, likely to a point even stronger than it once was. Why is this good for entrepreneurs? Because starting a business now, while the economy is down, means that your business will be established when the economy recovers, making the timing perfect for explosive growth or even better, to sell!
In theory, this is actually a fairly valid point. After all, if you start a business in a boom and your growth is strong, when the next recession hits, you’ll have to hold on to that struggling business and deal with all the problems established business deal with in recession, and hope for the best. If you want to sell, you’ll either have sell in a buyers market like no other, or you’ll just have to wait! However, if you start your business in a recession, it’s the opposite.
Your costs are low because you’re still small. You won’t have to worry about layoffs and massive cost cutting, because you’re haven’t incurred enough major operating costs or enough staff to make it necessary. If you can grow your business a bit and establish yourself in the hard times, when the good times roll out again (and most people decide to launch start-ups), you’ll be in good shape to take advantage of all the associated opportunities. If you decide to sell, you’ll be selling an established business in a time when money is flowing and the market is in your favor as a seller.
The unfortunate part is that it’s not as easy to launch a successful start-up when the collective chips are down. Capital is hard enough to come by when the economy is doing alright, let alone when people are being squeezed. Angels and VC firms won’t be investing as much as they would be in good times, and sources of funding closer to home like friends and relatives will probably be even more dried up.
Boot-strapping will be an absolute necessity, and money will be extremely tight. It won’t be easy to get off the ground and get going, but it’s far from impossible. So if you’ve got an idea on the shelf that you thought you’d leave for a sunnier time, dust off and seriously analyze whether or not you could get it going, even in a limited form, with the means available to you now. If the answer is yes, it could result in a serious advantage down the road.
The second argument the author of the article made in favor of our current situation was related to hiring and the amount of talent available. So it goes, and logically so, the massive amounts of layoffs that have been going on have freed up a lot of very talented people from the jobs that once made them inaccessible to you. Likewise, the lack of jobs out there right now due to companies restricting hiring have lowered the compensation expectations of this newly available talent to levels far below the salaries they’d demand in prosperous times.
What does this add up to? Talented, cheap, available professionals who may very well now be in your price range, which they weren’t four years ago, and probably won’t be four years from now. So hunt them down. Best case scenario, your business takes off and when times get good, you’ll be able to afford their inflated expectations. Worst case scenario, you won’t be able to afford them, they’ll leave, but you’ll still have had a top notch professional working for your business for as long as they’re around, and the impact they may have could be substantial.
Again, it’s a little easier said than done. Hiring the right people is always difficult regardless of the economic situation businesses face, but the fact remains, the level of talent available at a certain compensation level will always be higher during recessionary times than it will in prosperous times. A top notch pro who demands $150,000 a year when things are good may very well accept $85,000 a year to come work for you after their old company is forced to cut them loose. So if by some form of magic you have money to spare in your hiring budget, do NOT horde it. Spend it. It may be the best money you spend during the entire recession.
]]>Anyone who uses Facebook has heard of Facebook Apps. Anyone who uses Facebook has been invited by a friend to install a Facebook app. Many of Facebook’s users have taken up that invitation. In fact, very many. So many that an entire small industry popped up that revolved around these applications. Companies were established that did nothing but create Facebook applications. Successful companies by the way.
These companies made millions and millions of dollars off of the successes of their Facebook applications and are still doing very well today. But just as fast as this micro industry was born, it’s more or less all but dead. Well dead at least for new comers.
When Facebook announced that it was going to open up its development platform so that outside developers could write applications that could be installed and used on the Facebook interface, the idea caught on extremely quickly, and if sheer numbers are any indication of success, did very, very well. Facebook application started to pop up all over the place, and like wildfire, many of the applications spread extremely quickly across the entire network.
Some of these applications ended up being installed by millions and millions of users and the companies that specialized in developing them exploded. Companies like RockYou and Slide Inc. (which was backed by the founder of PayPal), did so well that they’re now valued in the millions. RockYou now even has its own ad network that other Facebook developers can use to monetize their new apps.
The monetary potential of some of these applications was mind boggling considering they’re just widgets designed to work in another companies infrastructure. Now though, the money to be made through Facebook applications is all but gone. So what happened? Why did the revenue potential of the might app. go extinct?
Well firstly, there isn’t a lot of room for completion among Facebook applications. It tends to be a real first come, first serve kind of world. In the business world outside of Facebook, competition is always a threat and new entries have the potential to steal market share away from established mainstays.
On Facebook though, people tend to use what their friends use, and the adoption rate is so ridiculously fast, that first entries into any given niche tend to take hold and grow like weeds, choking out any possible competition. If you were the first guy to write a Facebook application that lets people post pictures of their dog’s butts on their friends’ walls, then you’re probably not particularly concerned about the second guy to write a dog’s butt application.
This can be seen by analyzing the most popular and most used applications. Almost none of them are duplicates of another concept among the list. Once one app. takes hold of a niche, it tends to keep hold.
Secondly, and likely most importantly, is that Facebook was initially very liberal on what it considered spam, and those days have changed. If you’re a Facebook user you probably remember the days when you’d log on each day only to find five more “invitations” from friends to install the newest widget that would allow you to send your best buds a digital booger or an e-fart or whatever.
You also might notice that now you receive much, much less of those invites. This is because initially, Facebook let applications be programmed so that users could invite as many people as they wanted to install. Naturally, Betty would install an application that she liked and in turn, with one click, she’d invite every one of the 1000 friends she’s attached to on Facebook.
The view was, it’s not really spam if it’s coming from your friends, and growth of the initial rounds of Facebook apps was lightning fast. Now though, Facebook has realized that people don’t enjoy being flooded with notices and invitations, and have severely limited the number of them that applications can send out. Invitations are now limited to 10, and notices are policed by users.
Too much negative reaction and your application will be labelled “spammy” and taken off the market. What this means for new entrants into the Facebook application arena is that growth is at a snail’s pace compared to the growth seen by the forefathers that paved the way. And that also means that the applications that established their major user bases are now essentially cruising along uncontested because the new limitations make it almost impossible for new competition to touch their massive user bases.
Still though, people flock to the Facebook developer platform in search of their fortune (the author isn’t innocent. I recently had an app. developed with fairly high hopes for its viral potential, only to realize the folly of my ways). It’s like a gold rush continuing on well after all the gold has been excavated. The vast majority will be disappointed, but some may actually do alright.
They won’t bring in millions like Slide and RockYou, but a respectable revenue stream is still not impossible. Just remember that if you are going to try and take on Facebook apps., you need to be prepared for slow growth, and under no circumstances should you try and compete with an established application. Overall though, the Facebook application directory is already super-saturated, and your time, effort and money could be spent much better focused on other projects.
]]>Firstly, while debt may seem expensive, the cost of borrowing can be, for the most part, considered a short-term cost, at least for start-ups. The debt you’ll be taking on will not likely be on a term of more than a few years. On the other hand, equity financing is forever. When you sell someone part of your business, it’s for good. The only way you can get that back is to buy it back. Consider that and you may come to realize that equity financing can in fact be far more expensive than debt financing when you look at the long term.
If you assume you can build a successful business (a big assumption for most, but humour me), then looking at the cost across the lifetime of your business paints a very different picture than the short term view. In the long term, years after you’ve become successful, that debt you took on to get off the ground will be a distant memory. On the other hand, that chunk of the business you sold will still be in someone else’s pocket, and they’ll have a claim to a piece of your profit pie year in and year out.
Secondly, debt financing leaves control of your business in your hands. You’re responsible to repay that debt, plus the interest, but the lenders generally won’t get in your hair about how you run your business (unless things get really bad). This is a huge advantage. When you raise capital by selling equity, you now have a responsibility to a shareholder or partner. And if that shareholder takes on a large chunk of ownership, you can bet they’re going to want to have a say in how things get done. Rightfully so, too! They’ve put their own money on the line, and they deserve a voice in how things get done.
This might not sound so bad, and in some cases it isn’t, but in some cases, it can be awful. You may take on an investor who you soon find out doesn’t share your vision, decides they don’t believe in your abilities, or are just a general pain in the ass. And you’ll be fully accountable to that pain in the ass! Debt financing on the other hand doesn’t bring with it the possibility of losing control of your own company.
So when is equity financing a good way to go? Check out Part Three of Debt vs. Equity to find out!
]]>While it is true that almost all consumers will make knee-jerk judgments based on their initial experience with a product, that doesn’t mean that all eventual purchases are based off of these reactions. There are definitely situations where a consumer will decide to buy based on a first impression alone, but this depends completely on a number of factors present in the overall buying decision, the most important of which is the risk involved.
Risk could take many forms. It could be financial risk where the consumer may stand to lose money if they make a poor buying decision, or it could simply be the risk of nothing more than being unhappy with the product after purchase, but risk is the key factor. For example, if I stop into a store on the way home and I want a magazine or newspaper, I’m not going to spend time researching the different options, carefully scrutinizing the content of each option, comparing several similar substitutes before deciding. I’m going to walk in, look at the covers, maybe flip through one or two, and make a decision based on very minimal information. Why? Because the risk involved in the purchase is very low. If I choose a crappy magazine, I’m out five bucks and a few minutes. Nothing to cry over. Because of this, I’m more than willing to make a purchase on a snap judgment. There are a lot of products that fit into this sort of buying activity but they all have one common factor. Cost.Products that people buy on whims and first impressions are almost always low cost.
For products like these, focus groups likely are a waste of time and money because they won’t truly reflect the way people judge such products in real life. If I’m a company that sells children’s toys, sitting kids or parents down in a room and asking them to thoroughly examine a toy and give me their feedback on it probably won’t give me much information that will relate to whether or not they’d buy that toy when they saw it on the shelf in Toys’R'Us. I’d probably be better off showing them a couple different packaging options for no more than a few minutes and asking them to point out which one they find more attractive. This would be a much better reflection of the actual thought process that person would go through when faced with a buying decision in store.
This does not hold true, however, for high risk purchases. People won’t make their buying decisions so easily in such cases. They’ll still make snap judgments, it’s human nature to do so. But they’ll go deeper than that because they know that if they do choose wrong, it will hurt them in some way, whether it be financially, physically or emotionally. This is where the value of focus groups becomes clear. Products that require a deeper level of thinking on behalf of the consumer are perfect candidates for focus groups as a form of market research.
When someone walks into a car dealership, the odds are one car on the lot will immediately catch their eye. Maybe they like the colour, the shape, the rims, who knows, but something will stand out and they’ll make a snap judgment. They won’t run into the office and sign a contract because of that though. The buying behaviour is completely different than it was with the toy in the toy store. The same customer that bought a $30 toy on a whim will think long and hard about a $30,000 car. Sure the shiny, fast looking red one may catch their eye and become their initial favourite, but upon inspection, they may find that the fuel efficiency is poor, or that their isn’t enough space for them, the kids and the hockey gear, or any other number of factors that will change their minds. There is risk. If they take home that shiny red car and something about it doesn’t work out, they have to live with that $30,000 mistake.
In a situation like this, a focus group is perfect because it will much more closely resemble how a consumer would analyze that product in the real world. If you’re trying to put out a new mini-van, but your focus group says that upon inspection there doesn’t seem to be enough space behind the seat or that they’d strongly prefer it to have this feature or that feature, you’ve just been given valuable insight into the exact thought process that consumer would be going through standing on the lot.
This is the guideline that should be taken when deciding whether or not a focus group is of value to your marketing research. The most important thing you need to determine is the amount of risk that is involved with the purchase of the product you’re researching for, and if it strikes you that the product is something that is either not expensive enough, or not significant enough, to cause a consumer to worry about making the wrong decision, and in turn put in extra thought, then a focus group may very well provide you with a whole bunch of data that does not accurately represent the real world thoughts and feelings of your target market.
What they say in the focus group is one thing, but its what they think in the store that counts. If you hold a focus group for the wrong kind of product, you may find yourself ending up with a whole lot of very expensive lip service.
]]>In his book The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich
But how can you be more wealthy with less money? The easy answer to that is that there is more to being wealthy than the size of your wallet. Time is just as important as money (and to some, even more important). Afterall, what good is a whole lot of money if you don’t have the time to enjoy it? Likewise, stress levels tend to rise with increased work loads, so that salary may look great on your financials, but is it worth the grey hair and the ulcer that came along with it?
Consider two neighbours who we’ll call Peter and Tom. Peter is an executive at a large corporation and brings in a very significant paycheck. Annually he brings in around $190,000 before taxes. It’s also not unheard of for Peter to spend up to 60 hours a week at work or doing work related tasks. Tom used to have the same job title as Peter but stepped down and now works as an independant consultant. Tom only makes about $90,000 per year before taxes, but he never spends more than 30 hours per week working. Who is more wealthy? The answer might seem obvious on the surface, but is it?
Peter has a wife and 2 kids and a large 6 bedroom house. He works damn hard to pay the mortgage on that house, and he’s earned it, but a house with 2 less bedrooms would be adequate for his family. Tom also has a wife and 2 kids, but he lives in a much more modest house that meets his families needs but doesn’t go too much beyond them. Peter has a speed boat that he keeps a picture of in a frame on his desk at work. Unfortunately, he’s in the office so much that he only gets to drive it a few weekends each summer. Tom only has a kayak, but because he limits his work load, he gets to paddle a few times every week. Peters son is an exceptional hockey player, but most of the tournaments come and go while Peter is bogged down with big, important projects. Tom’s son plays basketball, and because Tom is essentially in control of his own time, he can shuffle things around if necessary in order to ensure he gets out to the big games.
So who is more wealthy after all? That depends completely on what you value personally. There is no right or wrong answer in this situation, the difference is only how each of these people is wealthy. If money, gadgets and status are of personal value to you (and there is nothing wrong with that), then perhaps you would say Peter is better off. However, if time and freedom are of more value to you, then you may look at Tom and say he is the wealthier of the two. He’s completely able to provide for his family and their needs, and although he may not drive a fancy car or have as big a house as Peter, he does have more control over his time and how he uses it. It all depends on what you value. It’s all relative.
This is where hourly rate comes in. Peter might consider himself more wealthy than Tom, but Tom may point out that while Peter pulls in much more money each year, if you break it down, they both make essentially the same number of dollars for the actual time they put in.
So are you a Peter or a Tom? It’s completely possible that you’ve never even asked yourself this very important question. Many people go into work each week and take on more and more until they hit the breaking point, because that’s what they’ve been conditioned to do. Keep giving your employer every ounce you have and keep hoping it’ll result in that promotion or pay increase. But is it worth it? It may be, but maybe not.
So if you knew you could turn a key today that would result in you making less money overall, but with more time, and specifically significantly more control over your own time, would you do it? If the answer is yes, perhaps you’ve already started taking steps to make that possibility a reality. If not, why not start now?
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