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What's keeping your up at night? Send us your most pressing questions and our expert John Mansour, founder and CEO of ZIGZAG Marketing, will try to help. Question: Our product can take up to three months to build. Our customer's anxiety during this process can be misleading. Because blogging can damage a reputation overnight, how do we protect our brand before we've had a chance to present the final product? -- Vanz Steimle, California Pools, West Covina, CA Vanz: Since your product is a custom build for each customer, it's imperative to set expectations up front in a way you can meet or exceed them. Predicting your own performance is probably the best way to mitigate your customers' anxiety, which prompts the negative blogging before the final product is presented.
Question: With marketers increasingly adopting more and more refined market segmentation -- fueled by the Internet and other customization efforts -- some critics claim that mass marketing is dead, while others counter that there will always be room for large brands that employ marketing programs targeting the mass market. Is mass marketing dead? Or is it still a viable way to build a profitable brand? -- Ekwunife Uche Juliet, Bangi, Selangor, Malaysia Ekwunife: Remember when the marketing experts predicted that the Internet would remove the middle man from the supply chain? It never happened. The same is true of mass marketing. It probably won't ever die, although we are seeing less and less of it. There are three primary drivers behind the decline in mass marketing. Question: I am starting up a concierge company. I am trying to come up an effective way to charge people. I thought about having a membership fee; however, since I a new at this, I don't think I will get the clients to pay the membership fees. How should I charge them? -- Robbie Wilson, London Robbie: Before you can create your pricing structure you must first determine the value of your service by further defining it. Here are the 4 W's of introducing a new product or service.
In order to accurately answer these questions, do some market research to analyze other concierge services. At a minimum, you'll get a good understanding of the niches being served (and not served) and what the market will bear in terms of fees for different types of concierge services. Once you've chosen your niche, do some informal research by asking your target customers if they find enough value in the service to pay a fee. If the answer is yes, present three different pricing structures (annual subscription, pay as you go, etc.) to determine which is most desirable. Lastly, determine the habits of your target customers to determine your marketing and promotion strategy. Where do they go? What do they read? Who they talk/listen to? This will give you good insight into how and where you need to market your services. Question: After leaving the IT industry, I started up an upscale, confidential courier service to serve the legal industry and upper / upper - middle class (similar to the Transporter movie). Since this is a very niche market, what would be the best approach to take this to market, considering I don't have a large chunk of funding? -Alani Kuye, The Transporter, Norwalk, CT Alani: The first and most important decision is to choose a single target market since you have limited resources. You've identified two potential markets -- legal firms and upper middle class consumers. As a start-up, focus is extremely critical. You want to develop a core competency serving a single market then leverage that competency to expand into other markets. To help you choose the market segment that lends itself to a fast start for your company, here are three considerations:
Question: I've created a design concept, which can conceivably thwart or greatly reduce bank robberies, but it requires technology that I have little knowledge about. How can I obtain a prototype for my design concept? -Lance Gardner, MonEBack, Assurance, Inc., Arlington Lance: It sounds like a fabulous idea. The first order of business is to contractually protect your idea before sharing it with anyone. Consult an attorney who specializes in intellectual property rights and determine the level of contractual protection you need to safely share your idea with technology companies. Have the attorney draft a non-disclosure agreement that you will require technology providers to sign prior to discussing your idea. Once you have a mechanism to protect your intellectual property you can begin searching for technology providers to prototype the idea. Google is a good place to start. If your idea requires software, find companies who are in the business of custom software development and have expertise working with security applications for financial institutions. If the idea requires a hardware appliance, find manufacturers who specialize in design and engineering of security appliances. Before you engage with any technology providers, be thorough and ask for customer references. The key metrics you're evaluating are project completion by the date promised, within the allotted budget, scope as planned and quality. Once the prototype ball is rolling, do some market research to determine the banking segment that has the biggest need for this solution. While it sounds reasonable that all banks would want to thwart robberies, the reality is that some are more willing to pay for it than others. Is it the largest banks with the most branches or the small and medium size community banks that are most susceptible to robberies? Many entrepreneurs fail to clearly define a target market before launching a new business and quickly drown because they're too small to satisfy the needs of very diverse customers. Start with a narrow slice of the market and use your successes as the stepping stone to widen your market reach. Question: Is cold calling a "one-size-fits-all" approach to sales prospecting? Can it jade a relationship with a potential client? - Glenn Moore, Freedom River LLC, Hudson, Wisconsin Glenn: There are two techniques to successful prospecting, cold calling and marketing. Using a combination of both will result in a bigger sales pipeline as well as healthier prospect relationships. If you do absolutely no marketing, then cold calling is your only option to find prospects. The key to successful cold calling is a pitch that strikes a nerve with your target customer. The lynchpin of any successful prospect relationship is to make the dialogue 90 percent about them. Think of it like this. Your paycheck is in their pocket. If you want their money you have to talk about them. The reason many cold calling campaigns are unsuccessful is because marketing and sales people make the mistake of opening the dialogue with statements that have no relevance to the prospect such as, we're the leading provider of... we're the market leader in...we offer the highest quality products... our technology is superior to. This is affectionately known as "we-ing" on yourself and yields very poor results. The better approach is to open the dialogue with something that's relevant to your prospect such as, "I've been speaking with a number of your counterparts at other legal firms and one of the top issues we routinely deal with is the excessive amount of time and effort spent on the phone with frustrated customers to correct invoices. If your firm is experiencing a similar issue please call me and I'd be happy to discuss how we've helped your counterparts solve this problem with our time tracking and billing solutions." By taking this approach you're making the call all about them and it doesn't come across as a sales pitch. You portray yourself as more of a resource who can help solve a problem versus a product-hawking marketer or sales person. If you dread cold calling as most sales people do, up the ante on your marketing efforts and be sure to have a call to action that offers something of value, such as a white paper or industry metrics. By collecting a minimal amount of contact information for people interested in the fulfillment material you now have a list of prospects who are more likely to entertain a warm call because they now know something about you. Whether you're cold calling or marketing, remember one thing. It's not about you. It's about your prospective customers. Keep the conversation focused on them and you'll have greater success cold calling and your prospect relationships will begin with a more positive tone. Question: My start-up is a website specializing in hosting a niche market of viewers' videos. As an original content site offering free information and video my only source of revenue will initially be through advertisement. How can I forecast earnings to my potential investors with a business model such as this? - Gregory Smith, Where In the World LLC, Greenville, SC Gregory: Revenue and earnings forecasts are an inexact science, so the most important thing you can do to earn credibility with investors is to demonstrate a logical thought process and a dose of reality to support your forecasts. In your case there are three variables to consider, the number of potential advertisers, the average amount of annual revenue you could realistically expect from each based on current statistics of similar businesses, and the productivity of your sales engine in any given year. The formula is fairly simple. Follow these steps.
In subsequent years the number of sales reps and average advertising revenue may change according to your growth objectives, but as long as you stick to these formulas as the basis of your forecast, your investors should buy it. The only other variable to keep in mind is competition. How many other businesses are vying for the same advertisers? Is the number of advertisers you're forecasting each year realistic? Keep your forecasts simple and logical with a high dose of reality and your investors should be content, especially if you're meeting or exceeding the forecast. |
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