To cut through the digital clutter:  Tell stories.

To cut through the digital clutter:  Tell stories.

Feb 13, 2017 | Branding, Marketing

Stories are personal, they resonate, you see the real people behind the business, not some nameless corporation, the people who do the work, and are accountable for  the decisions and outcomes.

Facts never change anything, but stories can.

Martin Luther King did not recite a list of the facts surrounding the deprivations and discrimination of the American negro in his 1963 speech, he told us of his dreams, and changed the world.

Facts are boring, stores are listened to, part of our DNA, we listen to stories and relate to them into old age.

 As a kid Dad read to us from what became known as ‘The weekend book’. A book he had been given as a kid, of the Greek legends. I saw that book again for the first time in probably 40 years last weekend. My sister had it carefully stored, as it is now falling apart from almost 100 years of love and use. She has kept the family tradition alive by reading the stories to my niece, who is as familiar and engaged with them as I was at her age. As I turned the pages, every page, story and picture was as familiar as if 55 years had not passed and I was 10 again, listening to my dad reading them.

Stories allow you to differentiate in an emotive and highly engaging way. Your story is yours, not your competitions, yours. They can be used to give potential customers a reason to go nowhere else, they give you a personality that cannot be erased with a cheaper price, or a hyperbolic sales pitch.

Tell stories

I am currently working with a medium sized printer, a 60 year old business founded by the current MD’s father in the mid 50’s. In a recent move of premises, sitting in the corner was the original little printing press that he had used to start the business,  about to be sent to the tip. Aloud, I wondered at the stories it could tell if it could talk. That press now holds pride of place in the foyer of the new premises.

We trust those we know, and we get to know people by hearing, understanding and relating to their stories. Facts simply do not  build trust, they bring enlightenment, and understanding, but not trust.

Tell your stories, you may be surprised at who is interested.

How do you price for services.

How do you price for services.

Feb 9, 2017 | Customers, Marketing

A common question from all those in consulting, and one I ask myself regularly, as it becomes really easy to under-price in order to get the job.

From time to time in the past I have done jobs for various bodies that I believe in, pro bono. I always thought it was my way of making a contribution, and that the effort was understood and appreciated.

Not so. In most people’s minds, things are worth what they pay, so a free consulting is worth exactly nothing, particularly if the recommendations are challenging and uncomfortable to implement. It is then very easy to just walk away as there is no skin in the game.

So, how do you go about setting your price?

Determine your hourly rate. Generally you can get a handle on the amounts that are the ‘going rate’ in the market, not just for your service, but for the range of services a business may need. For example, book-keeping is around $60/hour, a virtual CFO will be around $160/hour and a partner in a large accounting firm $400 plus. If you are selling accounting services, at least that gives you a context. More qualitative services like marketing have a similar range from the kid who can run your Facebook account for you, (not the copywriting, that should cost way more than a base rate) to the virtual  marketing manager with all  the skills of implementation at $160, to the widely experienced guru who will be $400 plus. Most shudder when that number is quoted, but why would a highly qualified accountant who looks in the rear vision mirror most of the time be worth more than a highly qualified marketing and strategic thinker who is looking forward, to the things that will sustain the success of your business?

Estimate the hours of a project. This always involves breaking a project down into its component parts, and making a judgement about the time each will take. The complication is always ensuring that the goal posts do not move. Agreeing the exact scope of the work up front is essential, and always hard, but scope creep adds enormously to the risks you face, and is present in almost every project I have ever done.

Provide the quote. Pretty obviously a multiplication of the rate by the hours, in most cases, perhaps plus a bit for scope creep and complications you did not anticipate. These are some of the considerations that play into the quote process:

  • A fixed price will always be appreciated by the client, as it removes risk, so long as there are also guarantees of performance in place. A fixed price also enables budgeting, which is usually very welcome.
  • Will the job lead to ongoing work? Often a key question in providing a quote, particularly for small firm like mine where a lot of time is spent prospecting. A flow of work that generates reliable revenue is enormously valuable as a means to keep the beast fed.
  • Who will be doing the work? Often the system is that the really important and highly compensated partner or rain maker sales person does the selling and negotiation, then hands the job over to the gophers, whose time gets charged at the high rate. Clients are not stupid, they understand this process, and have differing attitudes to it, usually depending on the confidence the gophers create in the first meeting. In my case, I do all the work, bits where some specialist advice is needed, I provide some referrals, and my clients make the choice. I do not clip the ticket for the referral, unless I am involved in the project management, and then the added cost is absolutely transparent.

Actively manage and communicate the project progress. Managing expectations is a key success necessity, and to do this communication is essential. Usually about the time you are tired of the communication is about the time that it is sinking in. Mutually agreed KPI’s are important, they act as milestones, but often the qualitative understanding of progress being made is as, or more important than, the pre agreed KPI’s.

Tracking your time is a key activity, you need to know how you are going compared to your expectations, and while this is not for the clients sake, it is vital for yours and the long term profitability of your business. There are many tools around to track time, pick one that suits you, even if it is a simple note in a diary.

Know who your ideal client is. Maybe not the name, but the characteristics they display, the market they are in, the problems they face to which you have a unique set of solutions and relevant experience. Having this piece of thinking done will enable polite removal of tyre kickers and those who are not really ideally suited to benefit from the experience and knowledge you have.

‘Embrace’ your pricing. This may be the hardest part of the equation for most. Charge what you are really worth, name the number with confidence. Usually for services that is hard, and is based on the outcomes, not the cost. An expensive consultant that gets results is far better value than a cheap one that does not. At some point, the question of what success means to your potential clients business comes into play, as does the ability to pay.

It is inevitable  that you will not get every job, and that you will need to keep a straight face as potential clients over-act a response your prices. You will also have to believe in yourself to the point where you can look people in the eye as you deliver the price and they over-react, and you need to be a good negotiator. Most people respond positively to a high price delivered with clarity and certainty about the outcomes that will be delivered. The first person, who has to be convinced that you are worth the price, is you. The second one is easier.

Guarantee an outcome. This takes a level of confidence that is pretty rare to be able to build as there are simply so many variables at play. However, if you are sure that by employing your services you can guarantee an outcome, you can charge almost anything you like up to that outcome, and most will see it as money well spent. Few will walk away from swapping 10 cents for  20. There is a lot of services marketing that involves an implied outcome, justifying a high price, but the explicit guarantee of success is not something I see much.

Leave it to them. This is a risky strategy, but one I use a bit on short term projects such as a workshop, where the investment of time is understood, there is a clear problem to be addressed that is right in your ‘hitting zone’, but they do not really know you. Giving them a ‘list price’ with the undertaking that you will leave it to them to assess the value of the time to them, and tell you the invoice amount. It removes risk from them, and underscores your own confidence in your ability to deliver value.

Your best marketing tool. We all know that satisfied, even delighted clients are the best advertising you can have. Referral business is the best business, and the easiest to get, as happy clients refer you to their networks as someone who really delivers value. When that value is delivered at a high price, so much the better.

As a final thought. Increasingly in a complicated world, we value simplicity in all things, and the response to your prices will be enhanced by simplicity.

Cartoon credit: Scott Adams and his alter ego Dilbert.

Net rule No.1: Own your own space.

Net rule No.1: Own your own space.

Jan 30, 2017 | Marketing, Social Media

Two recent events have put starkly into the spotlight the need to control your own space on the internet. When you use the space of another, you are just one of a huge number of a mass of irrelevant renters, and the landlord is able, indeed likely, to screw you at some point, as you have absolutely no power in the relationship.

First, Hewlett Packard. In September last year a change to the chips in some printers delivered via the net stopped those printers using anything other than the high priced HP ink working. In other words buy our printer, and we will control which ink you use, and we will actively prevent you making the choice for an alternative, and forget to tell you.  This post by Cory Doctorow, one of the most creative thinkers about things digital on the Boing Boing site  gives the details. A disgusting use of the power that H-P has taken by stealth, that would have the founders turning in their graves.

Second, LinkedIn last weekend. LinkedIn has developed as a remarkable tool offering the opportunity to connect widely, in exchange for just your personal details and commercial history, which they used to flog advertising. While we accepted the exchange, most dislike the ads that chase us around, latching onto the cookies sites we visit sneak onto our drives. Then Microsoft paid $US26 Billion for them and we knew, if we thought about it, that it would just get worse. Late last year LinkedIn told us they were going to ‘retire’ a couple of the really useful tools on the free version at the end of February. Disappointing, but not unexpected. The changes came in last weekend, a bit before the anointed date, and to call them wholesale is an understatement.

Having spent a bit of time last week poking around in the bits of LinkedIn left open to those on the free version, the changes have not just been a few tools removed, and a new look, it has been a wholesale gutting of the functionality. Unless you pay the piper, and the piper is being pretty greedy, the functionality we have become used to LinkedIn delivering, which is what made it so successful, has largely gone.

This will leave many with the choice of pay up or don’t bother any more.

It also highlights again the absolute necessity of building your on line presence on a platform you own.

Like many, I have made coaching my clients on the functionality of LinkedIn a part of my offering. In my case it is a small but important part of the value I have delivered to my SME clients. Many others by contrast have built a business  around flogging strategically superficial advice about how to leverage LinkedIn to generate leads and sales. I guess the side benefit is that those superficial methods are now into the  digital waste-bin, and we will need to get back to the nitty gritty of developing strategies and tactics that rely on our own capabilities and domain knowledge to work, rather than renting influence from digital landlords.

 

 

The greatest self-delusion of marketers.

The greatest self-delusion of marketers.

Jan 24, 2017 | Marketing

We marketers are great at deluding ourselves, we do it about all sorts of things, often to justify the resources we are consuming in the absence of hard numbers.

It is one thing to ‘get away’ with convincing the corner office that the number of ‘Likes’ on Facebook is a valid measure of our success, it is quite another when we actually believe it.

However, the greatest self-delusion in my experience remains undetected most of the time.

We mistake habit for loyalty.

Our marketing strategy and activities are normally about finding those to whom we add great value, and by hook or crook, getting them to stick to us in preference to a competitor. We go through processes now often summarised as ‘the buyer journey’ trying to create order in the place of the chaotic behaviour that is normal in our lives, creating diagrams like the one above,

Those few who we call ‘heavy users’ or some such term, we would also usually call ‘Loyal’ customers.

I would propose that in most cases they are not loyal, you have just managed to make it easy for them in some way, so they are habitual users rather than loyal users.

Habitual users do not think much about you beyond the transaction, unless you change something, the price, or availability, terms of service, whatever it is that they value from you, then they will consider the purchase in the  new light.

If they choose to stay, they are loyal, if they leave, or try an alternative, they are just habitual. In addition, the loyal users will proselytise to their networks the benefits of your product, habitual users will not bother.

Make sure you know the difference.

 

Will this change finally compel you to build your own digital assets?

Will this change finally compel you to build your own digital assets?

Jan 20, 2017 | Change, Marketing

Back in June 2016 when Microsoft paid $US26 Billion for LinkedIn, we all expected there to be changes. You do not spend that sort of dosh, even when it is just change as it is for Microsoft, without a plan.

The advice from many, including myself was that it had just become even more important than ever to own your own digital real estate, a functional and attractive website, delivering your value proposition,  rather than relying on rented real estate, someone else’s platform like Facebook or LinkedIn.

All the platforms monetise by being wholesalers of eyeballs, they sell advertising by many names to those who want to reach you, and do not care much about how you feel, only that you are reachable, and they have found remarkably innovative ways to do so, and I suspect the pace of innovation is just accelerating.

Early in January, all LinkedIn members received an email from our friendly hosts at LinkedIn saying they were ‘retiring the notes and tags features’ our connections page for those using the free version. This is simply code for if you want it, you can pay for it.

As the platform is theirs, as with a rented house we live in, we have no control over the terms and conditions, we accept them or leave. Not too surprising I thought, but nevertheless, annoying as the tags feature particularly is (was at the end of March) very useful.

Now I opened up LinkedIn this morning and there is a whole new look, no doubt aimed at making my experience better, code for we are going to charge you for something else you have had for free to date.

Again, not surprising, but annoying, not just because it will start  to cost me,  but because I will have to adjust to a whole new layout. I am 65, change does not come as easily as it once did.

Never has the importance of having your own digital real estate been more important, and never has it been harder to build. No longer can you stick up a dodgy website and have people find you, there are millions of sites, and billions of posts daily, being found by chance is harder than finding a particular grain of sand on Bondi beach.

The best time to start building a digital platform you own was 10 years ago, the second best time is now.  It is a bit like the telephone in 1915, everyone had survived to date without one, it seemed that you could continue to do so, but by 1920, no business could survive without a phone.

Do not stuff around, but it is not free, there is a substantial investment of time, skill, and money involved, but like the phone 100 years ago, you cannot survive without one for long.

 

How do you set your prices

How do you set your prices

Jan 16, 2017 | Marketing, Small business

Most times people set prices as a function of three things:

  • What their costs are,
  • What margin the budget demands,
  • What the competition is charging.

All are the wrong way to go about it.

Prices should be absolutely dependent on what customers are willing to pay.

This bears no relationship whatsoever to your costs, or what the boss wants by way of margin, but has a lot to do with what the competitors are charging, assuming your product is substitutable.

The challenge therefore is to ensure that there are no substitutes for your product.

In many categories, perhaps most, this is a real challenge, one that makes marketing all that much more important, as marketing should be focussed on the delivery of value.

Most businesses set out to deliver all the bells and whistles, and the reasoning is that they are trying to help customers by giving them as much as possible, and some choice. However, looking at a product feature by feature and figuring out which ones customers are willing to  pay for, and which are just in the way, makes more sense.

The better you know your customers, it follows, the better you will be able to determine which features they are prepared to pay for, and how much they are worth to them. It also follows that the more specific the niche you are in, the easier it becomes to understand their purchase motivations. Nobody can be all things to all people, choices simply have to be made.

There is an electrician in my local area with a strong proposition.

In an environment where we do not expect tradies to come on time, and when they do turn up, they tramp through your home, and leave a mess behind them. This bloke makes several promises:

He will be there at the nominated time, + or – 15 minutes, or you do not pay him,

He leaves the work area at least as clean as he found it, or you do not pay him.

He will give you the price before he starts the job, and it is a fixed price, it will not change.

He charges a premium rate, and the biggest problem for a potential customer is the waiting list. If you cannot wait, or do not like the hourly rate, he does have the numbers of others he will give you, without any guarantee of performance.

Many people in the area would not use him, as he ‘charges too much’. They are the ones who see little value in the propositions that make him different, and he is fine with that. In fact, he seems to enjoy directing potential customers elsewhere, as it highlights the fact that he is really busy, and has become a price setter, not a price taker.

Back to the challenge of price setting.

When the cost of provision of something that adds value is less than the value customers see, then it makes sense to provide it. In my electricians case, he leaves himself some spare time to ensure he can make good on his promises, and he charges for the privilege, simply because the certainty offers great value to his client base.

Simplicity is a key, the simpler the better.

Simple to explain, deliver and understand.