Please, if you own a business, take this simple (only 8 questions) survey on the impact the credit crunch is having on your business. It’s asking you whether you’ve applied for a loan, was it approved, would you have applied if it weren’t for the economic crash, and so on. I’d like to know, and of course I’ll share the results. Please click here to take the survey.
Thanks,
Tim Berry
President and Founder
Palo Alto Software
Survey says…
Every now and then you have to stop guessing about what your customers are doing and actually ask them. This fall, we conducted a survey of over 650 entrepreneurs and business planners who are using our software. Their responses yielded some helpful information for others tackling the most challenging aspects of business planning.
As part of our series on “Back to Fundamentals” in business planning for Global Entrepreneurship Week we’ve posted an article about our survey, what it tells us, and you, how to use survey results in developing and planning our marketing strategies, tactics and programs.
Click here to read our Planning tips from Palo Alto Software customers article.
There’s a lot of talk in the media and the blogsphere about the economy and how businesses will be reacting to the climate. Many are guessing there will be layoffs coming in the next several months. PR and Marketing departments are tightening their belts and some companies are cutting those departments altogether. Pretty scary times. But they don’t have to be.
If you look carefully, you’ll find a small but very vocal group of business advisers and business owners who are being smart and not reacting blindly to what is happening in the world.
They’re sitting down with their budgets, their management teams and consultants and really looking at what needs to happen to ensure their businesses survive.
If business is slowing down, what are you doing to ensure your customers keep coming back? If your competitor slashed their advertising budget, isn’t this the time for you to add a couple more budgeting dollars to pick up where they’ve left off? That expensive marketing tool or reporting system that costs you thousands of dollars a month – have you checked to see if there’s a low cost alternative that does pretty much the same thing?
Don’t doom your business by reacting too strongly to what’s going on. Sit down and make good decisions about where your money is being spent and where it will do even more good in the future.
Please join us November 17th, 2008 for a special webinar by Tim Berry on the importance of going Back to the Fundamentals of business.
Sign up for Tim Berry’s Webinar!
One of the most overlooked, forgotten, and intentionally ignored sections in a business plan is the analysis of the competition. Don’t kid yourself. You have competition. Everyone has competition.
It might be direct competition; another business selling the same service or products. Say you sell house paint. There are probably several other paint dealers and home improvement stores in your area selling paint as well.
It might be indirect competition. Using the same example, stores which sell wallpaper, wood paneling or vinyl siding compete against you. Even the house painter/contractor may compete against you by convincing a “do-it-yourself” homeowner to pay for the job on a “time and materials” contract where the painter provides the paint, purchased from his favorite supplier.
Read more about the competiton in Tim Berry’s Hurdle: the Book on Business Planning online: What you Sell and The Business You’re In.
Here at Palo Alto Software, we have read hundreds of business plans over the years. Our Business Plan Pro business-planning software includes over 500 sample plans. Time and again we’ve read a plan where someone thinks they have a unique service or product and proclaims they have no competition. Wrong. So very wrong.
Remember, before anything else, that every potential customer you identify has the option to not spend their money at all. They can choose not to buy from you, choose not to buy from anybody. Or they can spend their money on something entirely different.
Your competition is the savings account, the electric bill, the school tuition, the 401(k), the groceries, the kids’ allowance, next year’s vacation fund, etc.
When you develop your business plan, whether it is a startup plan for the bank or your day-to-day operations roadmap, spend some time thoroughly finding and analyzing your competition. From this you can evaluate what the other businesses are doing right and what they are doing wrong in marketing themselves, how well they are generating potential leads, and then converting those leads into customers.
For a marketing perspective on competition, visit John Jantsch’s Duct Tape Marketing and do a search on competition. Here is one of the many good articles from the list; Analyzing your competition.
Steve Lange
Senior Editor
Palo Alto Software
I find myself looking more often for reviews as I look for things I need to buy. And I’m routinely trying to read through the reviews, or between the lines, to weed out the in-house hype reviews on the one hand, and the raging angry maniac on the other.
Thanks on this topic to Jackie Huba of the Church of the Customer Blog for her post earlier this month sharing results of a study on word of mouth pass-along among adults. That’s on Online vs. offline word of mouth. She has some detailed statistics on word of mouth, quotes on research, and some good comments on available research. She notes that adults who conduct a lot of online research are much more likely to share results — facts and opinions — than those who don’t.
She also notes some conflicting results, and adds more flavor with her own additional comments. For example, she cites a Keller Fay study that says:
… 75% of word of mouth occurs in person, 17% on the phone, and just 7% online using instant messages, chat rooms, email and blogs.
That study apparently gets substantially different results from a study conducted by BIG research, which indicates a lot more online behavior. I like the skeptical addition, such as:
Here’s what I consider a flaw with that thinking: The frame of credibility. Being credible isn’t dependent solely upon the medium in which a recommendation occurs. Credibility comes from an established position of trust, whether it’s in-person or online, or from a preponderance of independent evidence, such as a collection of reviews on a product site like Amazon.
This is a good post on an important topic, with good data as well.
Tim Berry
President
Palo Alto Software
Technorati Tags:
marketing, word of mouth marketing, amazon reviews
Last week saw the thrust and parry of dueling keyboards as [a mainstream media consortium] took umbrage with the blogosphere, and bloggers’ frequent quotations from the [mmc]’s posted stories. There were demands for the take-down of various blog pages, and attempts to collect fees-per-word of quotes, as well as rapier-like witty ripostes. You can read about this on the TechCrunch blog, Post 1, and and Post 2.
While this issue seems, on the surface, to be about copyright, fair use, and possibly expansion of new revenue streams, it also deals with attribution and citing of sources. This is not just for journalists. It is just as important to entrepreneurs.
When you write your business plan, especially if you are using the plan to secure funding, you must cite your sources. Your plan will have topics and statistics covering your target market, population demographics, spending habits, market trends, market growth, and the like. The banks or investors or VCs are savvy business people. They know how to double check your assumptions, and will have no qualms about calling your bluff…and quashing your funding if they don’t credit your stats.
If your business is going to provide day care services, you’d better be able to show an increase in young dual-income families in your area. Investors are unlikely to support the construction of high-end mansions in a community that has been losing all of its industry. If you forecast skyrocketing sales, you’d better be able to document how a similar product or service did the same, and why yours will follow suit, and not crash and burn in a saturated market niche.
In other words you can’t pull your projections out of your … that is, out of thin air! Do your research! Develop your forecasts using that information. Document your sources in your plan. Take a look at this blog post by Alan Gleeson, Managing Director of Palo Alto Software Ltd, in the UK. The post quotes several people, businesses and news sources, and includes links and footnotes. Your business plan should do the same, giving the proper attribution to your sources.
As a raconteur I can make it up as I go along. As a business owner you don’t have that luxury.
Steve Lange
Senior Editor
Palo Alto Software
A few days ago the Wall Street Journal published an article about the results from a survey at a Microsoft Small Business event called Vision to Venture conference. The survey at this event found that 61% of women who own small businesses do no online marketing and 40% do not have a website. I read the results and naturally I was disappointed. Why is it that women continue to fall behind? But then as I thought about it, and investigated the source, I can say I don’t think these stats are representative of all women-owned businesses. Think about it:
So what’s my point? I think it is really important for everyone to understand that there are professional survey writers who know how to position a survey to get the results they want. Think about how politicians come out with survey results that always support them and their issues to a tee. I am going to say that I don’t believe that there is such a discrepancy between men and women in business when it comes to being online. I think that being online depends more on which generation you belong to than what gender you are.
-Sabrina Parsons, aka Mommy CEO
www.paloalto.com
www.emailcenterpro.com
Ask any teenager how he keeps in touch with his friends and he’ll spin out his Facebook/MySpace/Twitter account for you. But most likely not his e-mail.
More and more young people are communicating via their MySpace pages instead of email. This kind of trend suggests that the landscape of how we market to consumers will be changing drastically in the next several years.
Does this mean all businesses should run out right now and invest in those social media networks, dropping their older, more traditional modes of marketing?
Well, no. Not exactly.
While the other channels are gaining ground, e-mail is still far and away the preferred choice of current consumers.
‘Chelle Parmele
Social Media Marketing Manager
Palo Alto Software
On the Freakonomics blog there’s an interesting conversation happening about “The Perils of Free Coffee”. Author Stephen Dubner tells two stories of free coffee offers that had the opposite effect than was probably intended.
There are, of course, a lot of different kinds of “free.” Giving away a free razor or a free computer printer in order to lock a customer into buying your razor blades or printer cartridges is one model; giving away free merchandise as a pure marketing play is another.
The comments are filled with more stories of people turning away from the “free” offer to go across the street to take advantage of a paid option – all to avoid standing in line.
‘Chelle Parmele
Social Media Marketing Manager
Palo Alto Software
Gathering information is often one of the most challenging aspects of preparing a business plan or a marketing plan. A good plan supports assumptions with facts. Who says, besides you, the market for your product is going to grow 200% annually for the next five years?
A recent post by Michael Stelsner over on Copyblogger was the spark that led to this post. In his post he talks about using LinkedIn’s Answers feature to find credible sources for articles, blog posts, and white papers. It’s a good post and worth reading.
After reading the post, it occurred to me that services like LinkedIn’s Answers and Yahoo’s Answers could also be great resources gathering the information needed for a good business plan or marketing plan.
Your plan (and your business by association) will be better off if you can say that FirstName LastName, head of the IndustryName Association, said the market for your product is going to grow 200% annually for the next five years.
So give it give it a shot and let me know how it goes. On the surface, it sounds like a good idea.
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