Author Archive for davidcsmith

Get Simple: 3 Areas Of Your Business That Will Benefit From Being Simple

By davidcsmith · Comments (0)
Monday, September 24th, 2012

Union Pacificis celebrating 150 years of making and supporting our great country. Their traveling exhibit showcases their locomotives, rail cars, and their involvement in America’s history and growth.  Their exhibit is interesting, especially if you like train stuff like I do, but as I explored the Union Pacific exhibit a pattern starting catching my attention.  The work environment of the train (the moving parts, mechanical features, etc.) had been labeled to ensure there was no misunderstanding of what to do and how something should be used.  Signs like “Jack Here”, “Water Only” and “Plunger Out Brakes On” were clearly visible and easy to understand.  The necessity of this was clear; safety, speed, and efficiency are all important when you are working with massive rail cars and tons of equipment.  Clear messages associated with the business of rail cars helps Union Pacific.

The concept of “simple” can apply to your small business too.

Here are 3 areas of your small business where working to become “simple” will deliver results: Goals, Marketing Messages, and Measures.

Goals

Union Pacific played a major role in the expansion of the United States.  Their goal was huge, but also very focused: create a rail system that would connect the East Coast and the West Coast.  It was an enormous task but very easy to understand. Creating big goals that are simple to explain and communicate is important to small business as it provides the focus for your entire team.  Simple, and SMART, goals are essential for ensuring every member of your small business understands and is “on board”.

Marketing Messages

Small business owners can get frustrated with marketing, specifically poor results even though they are spend money on marketing.  If there is not a consistent marketing strategy the business usually has multiple, and often conflicting messages, which confuses your target market. In addition, if you are trying to attract everyone to your business your marketing messages can be ambiguous or overly complicated.  When crafting your small business marketing message focus on identifying and then creating messages only for your ideal customer. By narrowing your target market you’ll be able to simplify your marketing message to only those prospects you want to attract which will improve your results.

Measures

We have all heard the axiom “what gets measured, get managed”.  Unfortunately many business owners attempt to measure too much or create complicated measurements that are hard to consistently calculate.  This results in spending most of your time measuring – not managing.  The emphasis on measures should be on what you do with the information not an exhausting exercise of monthly data gathering and report generation.  Creating a list of the right measures for your business and ensuring they are as simple as possible will allow you to concentrate on making that aspect of your business better.

The advantages of getting simple are clarity, less frustration, and better results.  A word of caution though: Getting to simple requires hard work. That’s because simple does not equal easy.

What areas of your small business are you overly complicating and would benefit from being simpler?

davidcsmith

About David C. Smith

David C. Smith is a Managing Partner at Valens Point, a specialized consulting firm that helps small business owners increase the value and ‘sellability’ of their company. David comes from a long line of entrepreneurs having been involved with various family small businesses and working with small business owners. He has experienced first hand the strains of expanding a small business while continually delivering optimal customer and financial results. David helps small businesses implement sales and marketing systems using the proven principles of the Duct Tape Marketing. David attended Faulkner University in Montgomery, AL earning a degree in Business Administration. He resides in Boise, ID.

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Categories : Marketing Strategy
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Learning Marketing Lessons from a BBQ Joint

By davidcsmith · Comments (0)
Wednesday, September 19th, 2012

It’s Saturday night and I’m right on the outskirts of Birmingham, AL.  The day has followed the typically summer recipe; I part heat + 1 part humidity = a melting summer day in the South.   Even with the heat, one thought that couldn’t be baked out of my head all day was to reward myself with a southern classic – pit smoked BBQ.  I picked a local place of historical significance and while it is out of my way, I manage to find the place without too many U-turns. Once inside, I place my order without having to review the limited menu.

While I’m waiting for my order I take in the joint.  I’m seated at a large counter in the middle of the restaurant.   I can see the huge, wood fired pit at one end and the wait staff at the other.  The pit is being worked by some very seasoned veterans, who turn and pull pieces in the pit with cast iron tools that look as old as they are.  The wait staff takes and fills orders, organize the counter, and make customers feel like regulars – even if they’ve never been there before.   The product of a well-practiced process, the BBQ is clearly the focus of the business and why everyone is here. My order arrives and I enjoy the bliss of the first bite. What I know to be the proper way to eat a meal – slowly, savoring the flavors, is forgotten and I finish dinner quickly. Wow was that good – this place rocks!

Happy with the fulfillment of my culinary quest, I start thinking about the business itself and how the success of this BBQ joint is the secret sauce that many small businesses should be building.   I’m learning marketing lessons from a BBQ joint.

The BBQ joint is a great example of how a clear and narrow focus can build a better business. 

The maniacal attention placed on doing one thing right has put this place on the map and in the minds of its customers.  A product that is consistently made and delivered at the highest quality has built a reputation and a following.  They have built Know, Like and Trust by doing ONE thing exceptionally well.  Everything they do here centers on the product.:

  • Customers are completely engaged; they see the business, smell it, and feel it.  Key Points: customer experience, authenticity.
  • The product is in clear view; no mystery or confusion. The customer knows they are not buying the plate in front of them but the years of knowledge, applied through hours of preparation and cooking, delivered within minutes of ordering.  Key points: transparency, trust,
  • By offering a view of the BBQ on the hardwood pit, they show their work and the customers see and understand the processes that are used.  The customer is educated on the process of cooking and sees the evidence. Key points: trust, value, appreciation.
  • The employees and the tools of their craft demonstrate a commitment to the satisfaction and delight their customers.  The cast iron tools of the pit demonstrate strength and hard work.  The precision of the knife as it cuts your portion of meat demonstrates a commitment to quality and respect. The wait staff and their attention to every detail of your meal shows their desire to make it an experience.  Key points; excellent customer service, attention to detail.

Many small businesses have yet to recognize the simplicity and beauty of this model.  They fear that by narrowing their focus they eliminate many in the market that might otherwise appear to be their prospects.  They are right.   The illusion of marketing and serving everyone is misleading. It increases the number of businesses you compete against.  It reduces the satisfaction level of your customers because you can’t give your best to those that aren’t suited for your business. And ultimately, it is an expensive and exhausting business model to try to be all things to all people.

Most businesses, especially services-based businesses, know that getting more customers may not be as important as getting the right customers.   The ideal customer for your business appreciates the value of your products and services. They appreciate your process and product and know why your business is the right fit for them.  They are intellectually and emotionally connected with your business.

The lesson learned from this BBQ joint is this: Doing one thing exceptionally well allows you to focus on a narrow market which makes it easier to engage ideal customers and allow your business to differentiate itself from the competition.  The creation of a secret sauce for your business is a great way to build your business. Just like this joint.

What’s the one thing your business does exceptionally well?  And, are you using that as the “secret sauce” to develop your marketing strategy and grow your business?

davidcsmith

About David C. Smith

David C. Smith is a Managing Partner at Valens Point, a specialized consulting firm that helps small business owners increase the value and ‘sellability’ of their company. David comes from a long line of entrepreneurs having been involved with various family small businesses and working with small business owners. He has experienced first hand the strains of expanding a small business while continually delivering optimal customer and financial results. David helps small businesses implement sales and marketing systems using the proven principles of the Duct Tape Marketing. David attended Faulkner University in Montgomery, AL earning a degree in Business Administration. He resides in Boise, ID.

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Categories : Lead Conversion, Lead Generation, Marketing Strategy, Sales
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3 Questions For Determining If A Referral Prospect Is A Good “Fit” For Your Business

By davidcsmith · Comments (0)
Friday, September 14th, 2012

Growth in sales and increasing profits are essential elements for creating a sellable business. Referrals can be a tremendous source of new business, offering a means to grow your customer base with less cost and time.  Prospects sent to your business by customers and partners deserve a heightened level of attention, as the trust these referral sources have extended is precious.  If you have implemented your referral marketing system correctly your referral sources are sending you prospects that understand the value of your business and are towards the middle of the Marketing Hourglass™.  By extension, they know, like and trust you due to their relationship with the source and now they’ve been referred to your business to solve a problem, deliver a service or resolve an issue.  That doesn’t mean it’s a slam-dunk, touch-them-all, dance in the end-zone situation. You still have to determine if there’s a “fit” with the prospect.  (My fellow sports fans will appreciate that I managed to get a hat trick of sports references in the sentence above!)

Prospects sent to your business by customers and partners deserve a heightened level of attention.

Fit, that sense of being aligned, valued, and connected, is something that only you and the prospect can determine.  Here are 3 points that will help you think about and achieve the right fit with your prospect.

1.    Are you and the prospect aligned?  What I’m referring to here is the pursuit of solving the right problem or providing the right solution.  Understanding the prospects needs, requirements and expectations will help ensure you are the right business for the situation.  An honest assessment of your business focus and capability against the needs of the prospect will help you ensure you are the right solution.

2.    Does the prospect value your product or solution? Understanding what and why the prospect values your solution will also help you determine fit.  Appreciation of the factors that make your business unique and distinct are often the most important components of the business relationship.  If you value “A” and the prospect appreciates “B” doesn’t mean it won’t work – but knowledge of this difference from the start may help you determine if you are a good “fit”.

3.    Do you have a connection with the prospect?  Connection is also thought of as chemistry and is that “certain” feeling you have when you meet someone that has shared experiences, contacts and community.   People sometimes say they “hit it off” meaning that they achieved this sense of emotional connection with the other person.

These three points, while not an exclusive list, provide a basis for ensuring you and your prospect are a good fit.   Ignore the “fit” and you risk a situation where you may not serve a customer well, have not honored your referral source, and may lead to a compromise on your business focus.

How does your business determine if a referred prospect is a good fit? 

image credit: jscreationzs

davidcsmith

About David C. Smith

David C. Smith is a Managing Partner at Valens Point, a specialized consulting firm that helps small business owners increase the value and ‘sellability’ of their company. David comes from a long line of entrepreneurs having been involved with various family small businesses and working with small business owners. He has experienced first hand the strains of expanding a small business while continually delivering optimal customer and financial results. David helps small businesses implement sales and marketing systems using the proven principles of the Duct Tape Marketing. David attended Faulkner University in Montgomery, AL earning a degree in Business Administration. He resides in Boise, ID.

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The First Step To Managing Risk Is To Identify Risk

By davidcsmith · Comments (0)
Wednesday, September 5th, 2012

A Sellable business is not perfect and risk free, nor is that a desirable goal.  Artful management and balancing growth, profitability, sustainability and risk are what creates a sellable business.  But often its unmitigated risk that causes a good business to go bad.  Losing a key customer or key staff member, a change in laws or regulations, or the potential to lose critical financial support can bring about difficulty for small business owners.

The ability to mitigate risk begins with identifying where risk resides in your business.   Business owners have at least three areas within the business where risk can be identified and prioritized.

  1. Financial Risk
  2. Operational Risk
  3. Legal Risk

A business can never be totally without risk.  A sellable business is one that has identified risk and created the appropriate mitigation strategies.

Financial risk involves how you acquire and use money.  This might include access to capital and lines of credit, investments and investors, and over reliance on singular sources of revenue.  The owner must also consider the market conditions, competition, revenue risk, and product and/or service obsolescence when analyzing financial risk. Understanding financial management and cash flow is fundamental for small business health and is essential for the owner to master.  A relationship with a “banker” and not just a bank can be a valuable asset in understanding financial risk. They often can help the owner understand the acquisition and use of money and offer suggestions on improvement.

Operational risk may be the broadest area of risk as it includes almost every aspect of the business. Supply chain risk, process and procedure, equipment, technology, environment, and resources are all elements of operational risk. Reliance on a singular supplier or customer, business disruption due to weather or the volatility of a precious resource are examples of where risk is obvious but hidden risk may be in the areas of aged equipment, key employees, location changes that may increase costs, or insufficient controls. Detailing the business model and identifying relationships, channels, key resources, processes and partners are great ways to identify operational risk.

Legal Risk deals with not only the potential litigation areas of the business but also the regulatory and statutory environment.  Understanding risks associated with safety, staff conduct, intellectual property, and corporate responsibility must be balanced with changes in the regulations and laws that govern the location and industry of the business. Legal risk, especially in the regulatory and statutory areas, may seem like the least manageable area of risk but identifying what the risks are provides the basis for plans to address these legal risks.

A business can never be totally without risk.  A sellable business is one that has identified risk and created the appropriate mitigation strategies.

What do you think is the toughest risk to mitigate?  How have you addressed this risk in your business?

image credit: mack2happy

davidcsmith

About David C. Smith

David C. Smith is a Managing Partner at Valens Point, a specialized consulting firm that helps small business owners increase the value and ‘sellability’ of their company. David comes from a long line of entrepreneurs having been involved with various family small businesses and working with small business owners. He has experienced first hand the strains of expanding a small business while continually delivering optimal customer and financial results. David helps small businesses implement sales and marketing systems using the proven principles of the Duct Tape Marketing. David attended Faulkner University in Montgomery, AL earning a degree in Business Administration. He resides in Boise, ID.

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Categories : Marketing Strategy
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Building Trust is Essential for Business Growth

By davidcsmith · Comments (0)
Monday, August 27th, 2012

A sellable business can demonstrate consistent and purposeful growth.  Achieving growth is often tied to one of the biggest challenges businesses face today: building trust. The presence of trust increases the effectiveness and efficiency of the business, which leads to an increase in speed and a reduction in cost.  Shorter sales cycles, lower delivery cost, and a better bottom line are all potential gains from building trust. The results gained from building trust can help your business grow.

The word “building” implies that there is action to be taken and knowing where to start is the first step. Similar to a business strategy, a trust building strategy has to have specific areas of focus. The 2012 Edelman Trust Barometer identified several factors involved in building current and future trust. Operational aspects, including financial performance, rank high for building current trust while future trust is built around more societal aspects like listening to customers and treating employees well.  Most small business owners can resolve these two general areas into four specific trust building focus areas; Customers and Prospects, Staff, Financial, and Culture.

 Shorter sales cycles, lower delivery cost, and a better bottom line are all potential gains from building trust.

  1. The Customer and Prospect trust building activity centers on demonstrating your business’ trustworthiness.  This includes the reputation, track record, and value proposition of the business. The objective is to help prospects overcome trust obstacles and for existing customers to receive the value of the business relationship.
  2. The Staff trust building activity focuses on actions that can be taken that increase the trust your staff has in the business and its leadership.  An emphasis in this area may be the alignment of internal resources for optimal performance and programs that build company loyalty.
  3. The Financial trust building activity deals with how your business both achieves and uses its financial resources. This applies to the business’ supply chain and where the business invests.  A major emphasis in this trust building activity is to establish a link between the purpose of the business and the financial operations of the business.
  4. The Culture trust building activity relates to the internal and external character of the business.  Social responsibility, community involvement, and a demonstration of values and believes become building blocks of a culture that builds trust.

The Trust building activity is not a “one and done” management exercise.  Business owners are faced with daily decisions and actions that can either build or reduce trust.   Elevating trust into one of the primary decision making factors your business uses in these four trust building areas will help your business benefit from higher levels of trust – which is essential for business growth.

Where are you concentrating your trust building activity?

image credit: David Castillo Dominici

davidcsmith

About David C. Smith

David C. Smith is a Managing Partner at Valens Point, a specialized consulting firm that helps small business owners increase the value and ‘sellability’ of their company. David comes from a long line of entrepreneurs having been involved with various family small businesses and working with small business owners. He has experienced first hand the strains of expanding a small business while continually delivering optimal customer and financial results. David helps small businesses implement sales and marketing systems using the proven principles of the Duct Tape Marketing. David attended Faulkner University in Montgomery, AL earning a degree in Business Administration. He resides in Boise, ID.

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Categories : Marketing Strategy
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2012 Edelman Trust Barometer Identifies Operation and Societal Elements Important for Building Trust.

By davidcsmith · Comments (0)
Wednesday, August 8th, 2012

The ability of a business to establish and build trust is an important success factor.  The impact of Trust can be tangible, the financial bottom-line, or intangible, a positive reputation.   Balancing the tangible and intangible aspects of trust is an important skill for business owners to master.

The 12th annual Edelman Trust Barometer, a detailed survey and report focused on trust, provides a description and balance of trust building attributes.  The report provides both broad and specific information on the perceived levels of trust from around the world.  The 2012 version of the report contains no big surprises, for example it validates a decline in trust in Government and Business, and identifies areas where both are under-performing. However, it does provide some interesting points related to building trust in the section – The Path Forward. This section identifies several trust building elements that the survey respondents felt were important. For example listening to customer, treat employees well, and deliver high quality products.  Respondents also provided their view on how well businesses are doing in the execution of these actions and what they see as important for current and future trust levels.

Success Tip: “business owners must balance both operational (tangible) and societal (often intangible) elements in their trust building strategies”

In evaluating the current level of trust in the business the responses indicate that past performance and competence are highly influential.  This includes consistent financial returns (the top attribute associated with current trust) and the business’ innovation of new product. The report categorizes these items as “operational”.   When the focus is turned to future trust respondents list more “societal” items such as listening to customers (the top attribute), having ethical business practices, and putting customers ahead of profits.

The significance of this is that business owners must balance both operational (tangible) and societal (often intangible) elements in their trust building strategies and actions.  Planning and implementing actions that demonstrate trust in four areas of the business: Customers; Staff; Financials; and Culture that align with the public’s current and future trust will enhance business performance.

What actions are you taking to build trust in your business?

image credit: Stuart Miles

davidcsmith

About David C. Smith

David C. Smith is a Managing Partner at Valens Point, a specialized consulting firm that helps small business owners increase the value and ‘sellability’ of their company. David comes from a long line of entrepreneurs having been involved with various family small businesses and working with small business owners. He has experienced first hand the strains of expanding a small business while continually delivering optimal customer and financial results. David helps small businesses implement sales and marketing systems using the proven principles of the Duct Tape Marketing. David attended Faulkner University in Montgomery, AL earning a degree in Business Administration. He resides in Boise, ID.

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Categories : Marketing Strategy
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If You Say “Anyone Who Needs My Service” One More Time I’m Going To Scream

By davidcsmith · Comments (0)
Friday, July 27th, 2012

Every business serves a customer. That customer realizes and appreciates the value of what your business offers. Customers demonstrate this by buying your goods and services. Identifying and describing that customer is one of the most important elements of your marketing strategy.

In dealing with small business owners who are interested in growing their revenue one of the initial, and most interesting, conversations  is the identification of their ideal customer. When small business owners are asked the question, far too many have one of two responses; “it’s anyone who needs my product or service” or “anyone who ______(fill in the blank)”, which may be something as generic as “has a car” or “lives in a house”. Closely following this ambiguous statement of inclusion, the business owner usually states that they recognize this description isn’t very specific. The business owner acknowledges that their description of ideal customer isn’t really descriptive at all and does not help anyone understand how to refer prospective customers to them.  So why do they continue to repeat these generic descriptions? Maybe they have tried to be more specific but were not able to break through the barrier of the obvious.

Identifying and describing your ideal customer is one of the most important elements of your marketing strategy.

Follow these 5 steps and you will have a much clearer picture about your ideal customer.

  1. Identify your most profitable customers.
  2. From the above group, identify those that refer you to others.
  3. Next, find common demographic characteristics of that group.
  4. Identify the behav­iors that make them ideal.
  5. Give the ideal customer a name and draw a full biographical sketch to use as a marketing guide.

Steps 1 and 2 are fairly obvious. You probably know and like these customers a lot. Who wouldn’t like profitable customers that refer you to others?  Step 3, demographic characteristics, may be a bit harder but most business owners can describe a list of demographics that begins to build a picture.  When business owners get to step 4 they realize this requires a bit of thinking.

Here’s an example of how that usually plays out; While speaking with a real estate professional recently about their ideal customer we were at steps 3 and 4. When asked to give a couple of descriptive terms that would help someone better understand their ideal customer’s behavior, they had to really think. After a couple of minutes they had thought of a few attributes including; first-time buyer, qualified to buy, have an idea of what they want. As we were compiling the list we discussed the fact that other realtors were going to be able to include these on their list and identifying 3 or 4 attributes just wasn’t enough. We talked further and begin to look beyond the demographic and obvious statements into something more meaningful. We discovered that the real unique attributes started coming in around 8, 9, and 10 on the list. We were getting to the very specific behaviors that their ideal customer would demonstrate. For example; numerous years in the same job (stability), how they view neighborhoods (status versus convenience), and the phase of life that they may be coming into or out of (divorce, empty nesters, etc.). Once we had this long list of behaviors, attributes, and descriptive ideas it was easier for us to look at the list and pull out just those that would describe his ideal customer and represent a unique sector of the marketplace.

Try this yourself. Get pencil and paper and just start listing the attributes of the customers that you would like to attract to your business. Get your creative juices flowing by listing those obvious demographic attributes but see if you can go past those by adding 10, 12, or 15 additional. Once you have your list, see which ones stand out, which ones are unique, and which ones align to the value that you bring to your existing customers.

The exercise to identify these attributes allows small business owners to see past the initial demographic and generic descriptions that they routinely describe as their ideal customers and target market. Marketing to a defined ideal customer profile will be far less expensive, more productive, and have a greater impact on your business than trying to market to “anyone who has a _______(fill in the blank)”.

Want to learn more on how you can improve the results of your marketing that will increase your business growth? Take the Marketing Audit. It’s free and requires no obligation of further services.

image credit: jscreationzs

davidcsmith

About David C. Smith

David C. Smith is a Managing Partner at Valens Point, a specialized consulting firm that helps small business owners increase the value and ‘sellability’ of their company. David comes from a long line of entrepreneurs having been involved with various family small businesses and working with small business owners. He has experienced first hand the strains of expanding a small business while continually delivering optimal customer and financial results. David helps small businesses implement sales and marketing systems using the proven principles of the Duct Tape Marketing. David attended Faulkner University in Montgomery, AL earning a degree in Business Administration. He resides in Boise, ID.

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Categories : Lead Generation, Marketing Strategy, Sales
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