Category Archives: Small Business

Paying to Advertise for You

 

Almost every small business is looking for a way to get its name out and about without dropping a ton of cash on expensive ad campaigns. Who wants to spend much-needed money with little in return, especially in today’s economy? Companies try giving out customized pens, calendars, t-shirts, caps, you name it, each with varying degrees of success and associated costs. Check out the Advertising Specialty Institute impressions study, which compares different types of promotional items.

Custom printed bags get a lot of bang for the buck, the best way for small businesses to constantly market and advertise their names. The impressions study listed above has more specifics.

Consumers want bags they can use a dozen times more for different reasons. Not only does customized packaging serve consumers by providing reusable bags, but it also reinforces the company’s image and promotes the business name every time the bag is used. Yes, every time the bag is noticed, on the sidewalks, at friends’ houses, at the office or on the subway.

It’s similar to a walking billboard. Pedestrians who see a well-designed bag will turn their heads for a second look. Don’t believe me? Just sit on a park bench and observe. The pedestrian is not likely to remember the stranger carrying the bag, but the image of the bag itself will resonate. Or maybe the friend or co-worker will inquire about the store. Better to have that great image associated with your company than your competitor!

And by the way, according to the Advertising Specialty Institute, 187 people will see that bag in the United States. The cost to make those impressions is lower than other forms of marketing.

Speaking of marketing, a number of small businesses try to go the online route by blanketing the web with promotional comments. I’m talking about those who drop links to their blog or website link on tons of forums, regardless of whether these are appropriate avenues or not. Believe me, it’s more than okay to market your business online, it’s encouraged, through signature links and mentioning your store when appropriate. It’s not okay to derail threads! No one likes a spammer, or ad bomb, the type of poster who leaves one self-serving comment and a URL link no matter what the forum topic. Or worse, illegible posts created by auto commenting software. Ever see those? Like obnoxious word salad. Grammatical nightmares that make no sense in any context. Don’t associate your company with that kind of marketing. To promote your small business in a positive way, it’s much better to be part of the online discussion than a sideline hack. Just my two cents.

Brand or Bland?

 

Which bag above are you immediately drawn to?

As we discussed in previous posts, your company logo, from its lettering to design and choice of colors, immediately makes a statement about your business, for good or bad. Your logo is what your business stands for, what your particular style is, and what a consumer or client can expect. It’s a vital form of communication, an instant visual image that will either resonate or repel. If you have a million different emblems used in advertising, packaging and marketing, changing styles from one week to the next, it certainly makes it difficult for customers to associate any particular motif with your company. How will they recognize your business when it’s constantly changing image?

Consistently using the same carefully crafted logo is a much better bet to building your brand. In a tight economy, consumers are extremely leery about shelling out dollars for a brand they know nothing about or do not trust. When money is falling from trees, they may be less hesitant to try every product under the sun. But when the wallet contracts? So do the extra expenditures and the risk taking. Yet brand loyalty remains, as consumers perceive value in its purchase.

So what message is sent when packaging has next-to-no design? I’m talking generic packaging here, plain bags and boxes. Perhaps nothing comes of it. Maybe no one gives it a second thought as they head out the store door. Maybe a consumer assumes that the retailer is doing so well, the retailer ran out of customized shopping bags. Or maybe the consumer wonders if the stockroom forgot to re-order or is a disorganized mess. Or maybe, there is no message, because the store doesn’t have one, because it’s not important enough. That is a wasted opportunity. Maybe someone likes the red bag handles. But is anyone going to remember where that bag came from? Is anyone going to feel compelled to ask? Of course not.

Who wants to be anonymous? Small businesses that prefer to hide don’t make the Fortune 500 anytime soon. And just like companies take their logos and packaging seriously, very few businesses set out to be confused with a generic store brand. Everyone wants to stand out from their competitors and catch a shopper’s attention, for the most part. So when department stores and national retailers set up their own lines, they treat them as separate entities, including their own particular design and logos. J.C. Penny promotes a lot of its floor space to its own private clothing label, Arizona, while Target prominently displays its own food lines, Archer Farms and Market Pantry, near the name brands. Each brand has its own look and continues to attract and retain its own market. Those are just two examples, I’m sure you have a dozen of your own.

By the way, I’m not saying that logos are the be all and end all to a successful business. That is ridiculous. Start-ups can’t rely simply on well-designed logos to attract a billion new clients and call it a day. The company has to offer something to begin with, and something that consumers want or need, and let those consumers know the company exists in the first place. But we can’t ignore the vital part that packaging and overall branding plays.

Customer in the Driver’s Seat

 

Consumers buy what they want, what they need and what they think they need. Unappealing packaging does not fit in any of these three categories. Uninspired, bland boxes without a company logo are appealing only to the recycling center on collection night. If you were purchasing a present for a family member, would you appreciate a thoughtless presentation? Of course not.

“Needs” do not have to be practical either. Needs may be entirely subjective, can be based simply on emotion rather than a tangible, utilitarian purpose. Yes, we need food, shelter and clothes, that is pretty simple. However, we may want a steak or salmon entrée, a cashmere sweater, a penthouse or a five-bedroom ranch house. Those are wants that fulfill needs.

Consumers may later regret what they purchase because the item is no longer needed or wanted. But in the moment of buying, whatever the product may be is something that the consumer wants or needs. Who is drawn to a plain, unlabeled box and says to themselves, wow, I must have that! For what?

When a consumer is in the market for something specific, more often than not they seek recommendations, from friends, relatives or co-workers. And now, more than ever, from online strangers. Major retailers have online presence where customers submit comments and lengthy reviews regarding products. Amazon has hundreds of thousands of reviews for all sorts of merchandise, not just books and music. Yelp and many other sites don’t actually sell anything but have a ton of users offering their own reviews about every restaurant, store and retail establishment in the U.S. With millions of users adding two cents each, a consumer has access to a wealth of ancedotes. He or she can find out whether he or she wants to buy a product, visit a store or restaurant, try a new service, even if that consumer lives halfway around the world.

You know, even though we are an online society, increasingly more so each day, word of mouth is still true to its literal meaning. Recommendations can still come from random people on the street. Products and services are routinely a topic for small talk between strangers, whether at the ballpark or bus stop. “Where did you get that….?” Fill in the blank. Tie, watch, shirt, haircut, cup of coffee, groomed dog, etc.? What kind of ….. are you using? Strangers can easily talk about restaurants, hotels and a million types of products as easily as talking about the weather. Bad word-of-mouth can serve as a deterrent while a positive compliment may inspire someone to look further into the brand or service. The look on someone’s face also says it all when describing the product or service in question, from annoyed eyerolls to bright smiles.

What Does Your Company Stand For?

 

Great businesses are not in business simply to be in business, but to fulfill a purpose. If you own a local coffee shop, you are in the business of serving the neighborhood by being the neighborhood – a comfortable gathering place that serves great coffee to its residents. Does your packaging reflect your purpose? Does it represent what you stand for? How would customers make the connection if your boxes and bags are unremarkable?

Values are defined by what your company believes in, not just what it sells. Ideally, the products follow those beliefs, not the other way around. Wal-Mart didn’t start out as a conglomerate, and didn’t position itself as a “cheap” bargain basement bin. Rather, its values are to help customers “to offer low-priced goods every day “so that families can live better.” Large companies may spend tons of cash on neuroscience marketing studies – connecting how the brain works to the magical “buy now button” that prompts a consumer to purchase a particular item. But what does the company itself actually stand for? What does it believe in and strive for? Small businesses simply do not have the marketing budgets, the advertising dollars or the manpower to compete with the behemoths. But it does not stop them from having a purpose and fulfilling that purpose.

Saks Fifth Avenue is known for not only for its quality merchandise but the “experience” its customers have while shopping. So the store’s shopping bags reflect that. In a 2008 interview with the Boston Globe, Terron Schaefer, Saks’ senior vice president for marketing, was quoted as saying ”The bag is a reflection of all of those things and allows consumers to take a little piece of Saks Fifth Avenue with them.” Nordstrom, another high end chain, strives to provide a customer experience. Its founders started on the sales floor, and built their business on satisfying customers with exceptional service.

As an aside, many companies are jumping on the Groupon, Living Social and other “daily deal” bandwagons, with some sectors seeing success and others taking a bath. If your store, restaurant or retail establishment does not offer any kind of memorable “experience” to new clients, the retention rate will be alarmingly low. So please keep that in mind before rushing into promoting a half-off sale.

This should probably go without saying, but studies also show that consumers prefer to shop where values are shared or mirrored. I mean, do you hang out with friends that you simply can’t stand? Maybe you disagree on certain topics, but every single topic? How do you even get along or get through an evening, if that is the case? Same with consumers being attracted to stores that share their views.

If your company stands for friendly service, does it make sense to have gloom and doom cashiers or sales reps? It actually doesn’t make sense for any company to have such personnel, unless they are in the business of selling a depressing experience, perhaps a gothic boutique.

Bottom line: Your company’s core purpose should stand the test of time, meaning that no matter who the CEO is, whether it’s you or your great-grandchildren, that purpose holds. That purpose is still valid. This does not mean a company stagnates with products, refusing to update or upgrade. Technology will routinely change and any business wanting to stay in business will adapt to a fluctuating market place. But a change in strategies is NOT a change in purpose.

No matter what, remember this basic business principal: Be the best that you can be at your core business, everything else is ancillary.

Does anyone recall eating at the local Walgreens restaurant? Prior to 1975, the drugstore chain had more than 500 restaurants. Yes, that’s right. Restaurants. The company was performing below market average for years on end. Once the company focused on its core – the convenience drugstore model – its stock value went up considerably, outperforming bigger corporations in other industries. This is completely different from trying to be the best in unrelated and sometimes incompatible fields. For many companies, being the best at anything and everything is simply impossible. So why waste valuable resources, time and money competing in areas that other firms have a better standing in? Also, sticking to core values makes the decision process easier, for any business decision. If the choice contradicts your values, then the choice is simply not acceptable. Our values includes providing exceptional customer service, by solving problems. What’s yours?

Here to Stay or Gone Tomorrow?

 

Why do some companies thrive, some survive and some abruptly jump off after a short and miserable stint? Jim Collins and Jerry Porras, authors of the bestselling Built to Last, explored this question all business owners must ask themselves. The answer, in a nutshell, is that companies with core values, a vision and ability to sustain that vision are in business for the long haul. What that vision is, i.e. the purpose of being in business, does not change with the seasons, the tides or the daily mood.

Identify who you are, what you stand for and who needs you to be in business. Why is your product or service needed? Because it’s cool? Trends will come and go, what’s hot in this moment may be lame three minutes from now.

Define the customer, identify the market. Small businesses can easily overextend themselves by trying to expand too quickly with too many products that do not represent the core brand. Brand extension is everywhere and just becomes silly after a while. Don’t drive yourself out of business selling additional products that your customer base has no interest in purchasing.

In addition, all businesses which last usually have an identifiable brand. To resonate with consumers, the brand must be authentic, that captures your company’s mission and values. The packaging, therefore, must represent the brand because it is constantly communicating that message.

Custom printed packaging is not a luxury, or an option for the select few. Instead, customized packagaging is equally visionary, standing for your business goals, mission and customers. Are you selling self-confidence or selling to the self-confident consumer? Are you catering to a niche market or trying to catch everyone in a great big net? Define your market, always. If you don’t know who you are trying to reach or why you are trying to reach them, you may as well be walking around in the dark.

Companies that thrive do not rest on their laurels. Some of the greatest products are a result of trial and error, and constant experimentation. Some products come about because of seizing an opportunity or being unbelievably lucky with timing. But imagine being satisfied with one success? That’s like being happy with scoring a touchdown during a senior year home game, and never vying past that, even refusing to participate in college level sports. Indeed, there are many instances where companies stick to one success and find themselves languishing as competitors take the lead. Everyone knows 3M, for example. How many may remember its competitor, Norton? Once incredibly successful, the company decided to halt expansion into different product lines by sticking with tried and true abrasives. 3M, of course, went in multiple innovative directions, with the ubiquitous Post-It Notes – just one of thousands of examples. One company is still alive and well, the other was acquired in 1990 by the French-based Compagnie de Saint Gobain.

Companies that thrive refuse to rely on only one method of attracting new clients. Companies that thrive never alienate their customer base.

Falsely Green

 

There is a big difference between admiring an ad and believing its message. There is a big chasm between rhetoric and reality and you can bet your bottom line that your clients know that difference. Boasting about excellent customer service, then leaving a caller on hold for three hours? That’s not going to get anyone to take your claims seriously. Or for another example, say you own a plumbing or electrical firm, and promise “same day service or its free”. Then proceed to break that promise by finding excuses not to honor the pledge? Your company will either become a laughingstock or resented, perhaps used as a last resort when the other, more reputable plumbers are busy.

Same goes for making earth-friendly promises, then reneging or acting hypocritical with operational procedures or practices. Claiming to be eco-conscious and then packing items in multiple layers of non-biodegradable bags just doesn’t cut it.

More than ever, consumers are looking for products from companies that are going green. But just claiming to be green is a huge turnoff and can actually create a backlash, sending companies into the red. The results of this year’s Cone Green Gap Trend Tracker show that 71% of American consumers will stop buying a product if the environmental claims turn out to be false. In addition, a third of these consumers will outright boycott the company if a product does not live up to its eco-friendly claim.

This means if a coffee company claims its bags are “100% compostable” then the packaging has to be fully biodegradable, not partially. (SunChips launched a 100% plant-based biodegradable packaging. After consumers in the hundreds of thousands complained about the bag noise, Frito-Lay pulled the design. Companies that go with 100% compostable paper bags do not see such consumer outrage, or 44,000 Facebook friends setting up a page just to complain.)

Also, it doesn’t do your company any favors to imply endorsement by an environmental group. The most egregious, however, is to create a fake endorsement by an unverified third party. Similar to diploma mills, fake eco-labels are meaningless, and handed out left and right at whim. Some have even claimed that a product helps “fight global warming” which is a rather ridiculous assertion that can’t be verified.

Maybe a company can get away with such claims in the short term. Selling products to a number of strangers might be one way to make sales. Is it possible to continue building such a business? To retain the customer base, the consumers must have trust in your product and your company. Environmentally friendly packaging that is not friendly to the consumer is not going to impress too many customers.

Trying to ride the green buzz just for buzz sake is not going to fly either. More than half of your clients will be naturally skeptical to green claims. Don’t tarnish your reputation with false claims. If you want to go green, go green and mean it.

Follow the Golden Arches

 

Fifty six years ago today, Ray Kroc opened a McDonald’s Restaurant in Des Plaines, Illinois. It was actually in 1940 that McDonald’s stared with a car-hop restaurant, in San Bernadino, California. Prior to even that, White Castle popularized the fast-food hamburger by selling an image to the middle and upper classes. “Julia Joyce,” a White Castle spokesperson hired in host cities, visited several Women’s Clubs each day, touting the nutritional values of hamburger meat and cleanliness of the White Castle kitchens.

Today, McDonald’s is a multi-billion dollar franchise. Rather than relying on or taking its repeat customers for granted, the biggest fast food chain stays vigilant with marketing. In other words, McDonald’s is constantly making buzz about its products, whether it’s a new menu item, a variation of an existing menu item or a promotional tie-in.

In 2010, McDonald’s even changed the way it packages fast food. From understated fonts to bold sports typography and bright images of “healthy” ingredients such as lettuce and onions. Different meals have different graphics and different fonts to accent the food. How you see a font is similar to how you see a product. For example, the “Good N Cold” drink has frosty lettering while the fries have “crispy” text. Would you associate Hawaii with a style similar to the Wild Wild West? Of course not.

Most small businesses, unless they were rained on by the lottery fairy, initially operate by their bootstraps, sometimes for many years. Owners, facing a stream of expenses, often opt against investing in marketing, advertising and branding. But all of that is how the business grows and is recognized. Look at McDonald’s. Earlier this month, the corporation announced it would be hiring 50,000 new employees, which shows how business is doing. (Employment is usually a lagging indicator of the economy. Layoffs happen after a market tanks. Likewise, new employees happen after the market picks up.)

No matter what if the economy is expanding or contracting, entrepreneurs are used to frustration. My father and uncle started this business from scratch in 1950 and worked hard for every client. But entrepreneurs are also the types who relish freedom, the ability to act on one’s ideas without consent from a committee. They thrive on recognition and feedback, while assuming risk for failure. The Stockdale Paradox usually comes into play: “You must maintain unwavering faith that you can and will prevail in the end, regardless of the difficulties, AND at the same time have the disciple to confront the most brutal facts of your current reality, whatever they might be.

Again, McDonald’s did not start out to become a multi-billion dollar fast food franchise. It started out as one restaurant serving barbecued meals. It wasn’t until a multimixer salesman, Ray Kroc, took the idea national that it became a franchise (and not overnight.) By 1965, there were 700 restaurants nationwide, 5,000 worldwide by 1978. Today, the franchise has literally served billions of burgers.

What Do Consumers Want?

 

Every day, your company is competing for attention. Similar to a politician meeting the demands of constituents, every day your product must cater to its base, the customers who regularly purchase and those who are likely to do so. But while a whopping 93% of consumers recognize Mr. Clean, most people won’t recognize the average politician. A product that is packaged blandly is not going to be recognized anytime soon either. (Likewise, inappropriate, improper or obnoxious packaging is not catering to anyone and in some cases may just outright offend.)

There are a million theories as to what compels a buyer to buy in the first place. I’ll tell you this: A buyer is not persuaded to purchase a product because you say so. A buyer is certainly not going to shell out hard-earned dollars on a product because you will personally benefit from the exchange. Who on earth, besides maybe your loved ones, wants to make a donation to your wallet? No, the buyer is interested primarily in his or her needs and wants. Here is the “secret” lobbied around in marketing strategy sessions but should be shouted from the rooftops: You, the business owner, cannot convince a buyer what they need; the buyer ultimately must convince himself. But you can certainly make your case.

James Twitchell, author of Lead Us Into Temptation, notes that consumers ultimately live, create and change themselves through material things. So, they want and need products to make those changes. Although many consumers can be put into likely categories based on particular patterns, why anyone makes a purchase is still a personal reason, depending on each individual.

Not everyone gets it right, trying to figure out what consumers are looking for. Even big corporations with tons of money devoted to research and development make bad guesses. Remember Intelligent Quisine? Yeah, unlikely. Campbells created this remarkably bad frozen food line marketed to seniors. But no one liked the taste, so the line quickly died. You can’t sell the benefits of nutritious frozen foods if the meal tastes like cardboard.

And even if you get it wrong, it still pays to push limits. Bill Gates, in the 1970s, famously predicted that computer users would never need more than 637 kb of memory. Imagine if the computer industry stopped there, completely satisfied with a fraction of today’s memory? Consumers would have been fed up by 1984. Prior to 1984, very few individuals wanted a computer for personal use. Less than two decades later, one out of two consumers profess a “need” for home use. So if a consumer believes that he or she needs a computer, that is what the consumer wants.

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