On Internet Business

How not to launch an e-business

Posted by Michael under Business Growth, customer service, Entrepreneur Resources, Leadership, Online Retail, Social Media

A recent article at Inc. suggests that the easiest way to launch an e-business is not to have a great business plan but buy a website through a broker on which to launch it. I’d like to suggest that ‘easy’ is not a good route to business growth and that buying somebody else’s mistake is an unlikely way to achieve success.

Inc. suggested Ebiz brokers and eBay as the best places to find sites. There are more established locations to find sites for sale such as Flippa and Dalton’s Weekly

Looking at the ecommerce section of business brokers sites can also show up potential opportunities. UK brokers include:

Knightsbridge
Avondale.

Even if you can find a good site (and if they were going concerns with a good customer base why would they be on the open market, rather than brokering a goodwill deal with a competitor who can see their value?), there are inherent risks in this approach:

1.    The observable traffic on a site you purchase may have no value or even a negative value, if it’s not convertible
2.    Search engine rankings are fragile and Google, in particular is tough – if there are hidden dangers in the site you buy (cloaking, embedded automatic content generators, black hat blogging), stripping them out is costly and even when they’re gone, you’ll find yourself penalised by the Google algorithm
3.    The seller wont always give you the full story – it’s all very well asking questions but it’s quite another thing to get honest answers: when e-commerce fails, very few site owners are willing to own up to their mistakes in front of a buyer, even if they recognise them.

There aren’t any shortcuts to starting a successful online business. The business fundamentals have to be right

•    Products
•    Pricing
•    Promotion
•    Reaching the right customer base
•    Customer service.

If any of these are less than excellent, online customers find out quicker than any others, and spread their disillusion faster and wider than any others, using social media to inform a wide audience about your failure. They may be low barriers to entry in setting up an ecommerce business but without a clear strategy and unique selling proposition why will customers buy from a new online business?

If the fundamentals of the business are right, services like Volusion can help build a scalable online business. Volusion is an all in one software solution which already powers 30,000 online stores. It takes a lot of the headaches out of starting an online and, unlike many other solutions, it is targeted at UK merchants.

However if your aim is build the best possible online experience for your customers, starting from scratch with a bespoke website may not be the cheapest or easiest option but in the long run it still might be the best one.

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Real-Time Marketing and PR: How to Instantly Engage Your Market, Connect with Customers, and Create Products that Grow Your Business Now

Posted by Michael under Business Growth, customer service, Entrepreneur Resources, Leadership, Social Media

This book is an exploration of value and speed. It’s like an equation in business physics – the businesses that learn to deliver value faster than others are the ones that gain market share and loyalty. Speed added to value provides competitive advantage in the internet age.

So how does it work?

Some people struggle with the insight and anecdote based approach that David Meerman Scott uses to take the reader through how people, and organisations, have coped (or failed) in using real-time opportunities to engage with the real world, in real time, by offering value rather than relying on a pre-determined PR formula.

From the Amazon reviews about it, there are people who complain about the anecdotal style Meerman Scott uses: that he doesn’t provide enough empirical detail; that the metrics just aren’t in the book.  And that’s precisely the problem that this book sets out to solve. You can’t operate in real time using a manual. You can’t know what’s going to come at you, and you can’t guess in advance how the world is going to change around you, and in relation to you.

A perfect example, and the most famous, is the ‘United Breaks Guitars’ saga. A musician whose guitar was broken by United Airlines became so disgusted by the way the different airports passed responsibility for his claim to each other, that he wrote a song about it and made a video. That video went viral on YouTube. Two associated businesses: Taylor Guitars and Carlton Cases, seized the real time opportunity to publicise the value of their products in relation to the video and gained market share as a result. United Airlines apparently lost $180 million by failing to respond to the story.

In a blog interview David Meerman Scott made a key point about the brutality of real-time marketing, “Losing control is the toughest principle. You have to let people talk about your organization in the way that they want to talk about it. You can’t complain that they didn’t use your key words”.

In other words, to succeed, a business has to take part in a real-time conversation, not control it, and that requires leadership.

So how does a business use social media, crowdsourcing, videos, mobile devices, media alerts and so on to deliver value in real time?

Meerman Scott offers a range of tactics to help organisations speed up their information gathering and shorten their response time, but over and over he makes the point that what successful real-time marketing requires is a new mind-set that accepts that action is outward facing and fast, not inward looking and risk-assessment based.There are many examples of how other businesses learned to listen to more voices, act more swiftly, make rapid course adjustments and demonstrate their core values in both success, and failure.  He also talks about how to drive real-time customer value through an organisation with zeal and enthusiasm.

The examples recognise the need for speed and agility, while helping readers to understand when process applies and when it needs to take a back seat to swift communication. Moving quickly at the right time is prioritised in customer-facing business areas, while ensuring core values remain integral to decision-making is seen as part of the strategic function of a management team committed to integrity of response when under pressure.

There are many obvious tips that businesses still ignore – Meerman Scott says a business should respond in the same medium that the challenge arrived in. So United Airlines should have made a video apologising to the musician and loaded it on YouTube. Insisting on using ‘formal channels’ means not being heard by the same audience who get to hear the bad stuff about your brand, company or product, so all efforts are wasted because you’re talking to people who hadn’t heard about the problem (but have now you’ve pointed it out) and ignoring those who had heard about it. In other words, you’re damaging your own brand.

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What are the options for small businesses looking for a CRM System?

Posted by Michael under Business Growth, customer service, Entrepreneur Resources

Tech Cocktail pared down the guidance at Software Advice on the five top systems for start-ups looking at CRM, while a recent LinkedIn discussion on which CRM systems work best for start-ups pulled out some key features that mattered and why companies found themselves needing to upscale their CRM functionality. Interestingly, there was only one overlap in the systems that Software Advice ranked highly and LinkedIn discussants recommended to other entrepreneurs.

For Tech Cocktail and Software Advice the market leaders were:

Sage Act! Integrates with the Microsoft platform and has two levels, one for fewer than ten users, one for ten upwards. Its weakness is no partner management function, which matters to many start-ups at present.

Sugar has a key feature that will appeal to many – the community based version of Sugar is free! It’s also very basic, but for entrepreneurs new to CRM, it could be the easiest route to exploring the field, before committing to the paid version with many more functions.

Salestrakr is a sales-led CRM platform which imports contact data in almost any format, making it exceptionally flexible for companies with high contact volumes and a lot of networking activity.

Maximizer has a different feature appeal – mobile integration. In the Entrepreneur version, Mazimizer offers complete integration with mobiles, whether Blackberry, iPhone or Android, and then simple upgrading as the organisation grows.

The one system that appears to be popular with both software reviewers and CRM users is Infusionsoft – considered  ideal for start-ups and good as an introduction to CRM for small companies, although not so highly ranked by users on LinkedIn on its sales-led functionality

Highrise – based on the Basecamp project management platform, was praised by LinkedIn contributors for its simple interface and excellent automated reports, but was considered not so strong on sales-led functions. The overall view was that it might quite quickly become too limited in function for companies with a wide range of CRM activity.

Salesforce was considered to be powerful, web-based and have a wide range of functions. It’s a system that’s popular with businesses that have pipeline reporting needs and accounts in the thousands or hundreds of thousands. The downsides of Salesforce were twofold: it can take a while to get used to which can feel like a drag on performance and it might be viewed as costly compared to other systems.

Zoho operates like Salesforce, but is built on a business apps based platform so it’s cheaper (but even less intuitive for new users to find their way around). Those using Zoho praised its good functionality but commented on the longer-than-expected learning curve which seems to have frustrated several users.

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The language of business

Posted by Michael under Business Growth, customer service, Leadership

Charlie Mullins has been looking at the way that employers are pilloried in ‘Horrible Bosses’ and making the point that many employees are ‘unprepared for the challenges of employment’ and that people find it difficult to deal with ‘tough face-to-face confrontations’.  So how does a boss get the message across?

Being straightforward is often seen as being ‘horrible’ or ‘critical’ in work situations and Mullins points out that technology doesn’t help. Many younger people are not used to direct communication and text rather than calling or send emails or ims rather than speaking face to face. This leads to indirect communication, passive information sharing and the inability to formulate responses to challenges in real time.

The problem is often made worse by company structures that hive off complaints into call centres or customer service departments that don’t interact with the rest of the organisation. It means that painful communications aren’t shared and the techniques for dealing with them aren’t spread through a company.

Some bosses are horrible, but Mullins seems to suggest many employees are incapable of telling the difference between tough talk and horrible treatment, and even if they could, they aren’t equipped to do anything constructive about it.

In the same week that Horrible Bosses premiered, a study by Judith Baxter (Aston University) examined the different way that men and women talk in business meetings. She found that in the boardroom, men and women who are effective tend to use similar language. When, as is almost always the case, women are a minority at director level, they tend to self-deprecating language like ‘you might already have tried this and it didn’t work out’ or ‘perhaps I’m being a bit dense but I don’t understand ….’ as the result of being ‘too aware’ of another person’s point of view.

There’s debate about whether this helps women build consensus for their viewpoint or whether it holds them back. What does seem clear is that language matters and that the ability to talk tough in business is a skill that we all need to develop – just as we need to learn to listen tough too.

Boardroom by Adrian Eden

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Economic slow-downs around the world but shopping on the increase?

Posted by Michael under Business Growth, customer service, Entrepreneur Resources, Online Retail

From the beginning of July there have been concerns expressed over the pace of the UK’s economic recovery after evidence that the manufacturing sector in Britain is growing at the slowest pace for nearly three years.  Ireland’s manufacturing industry is shrinking and the economic boom in China is also dropping in pace. While the UK is not reversing direction or even stagnating, the healthy expansion seen earlier in 2011 is definitely on the decline.

However, while the making of things might be dropping, the buying of things is still growing, as in the space in which things can be bought! The top ‘retail destinations’ in the UK – London, Glasgow and Birmingham are about to be joined by Leeds, where a vast circular shopping centre is under construction. As property developers continue to invest in massive retail parks and shopping centres, UK high streets are seen as being under threat and in decline. Many familiar names have vanished in the past two years: Woolworths, Jane Norman and Habitat from city centres and Focus DIY from out of town shopping parks. So what makes speculators confident that big shopping venues will continue to thrive?

Retail analysts believe that three forms of shopping will grow in the next few decades:
1.    Diversity shopping – shopping with added extras; shopping centres with open markets attached to them are proving particularly popular, especially if the markets have theme days such as ‘organic’ or ‘local’ or events like chocolate festivals, beer fests or Christmas fairs
2.    Super centres – the bigger the centre, the more scope it has for appealing to the entire family: shopping with bowling or trips to the cinema added in, dropping of the kids for swimming or karate lessons while you buy the groceries, or mall walks for senior citizens that finish with a cup of tea and biscuit in a café – all currently bringing in multi-generational shoppers on a daily basis
3.    Online retail – the biggest growth centre for many retailers has been online shopping: the recognition that customer service is key to good online retailing has changed the internet-based marketplace and driven standards up so that many online retailers have the same kind of reputation in virtual reality as high street shops once had through word of mouth.

The high street isn’t extinct, according to Anna Smee, director of business strategy at Hundred Consulting, rather it’s evolving, ‘… [it] has undergone a huge transformation in recent years, which is a result not just of the recession but the growing momentum of online shopping. We are seeing a shift back to specialist, often owner-managed retailers that offer a high level of personal service or an unusual mix of products that are not available in the big retail outlets on the outskirts of the UK’s towns and cities.’ And that could mean that the next Habitat or Woolworths will begin trading online, with a market stall that travels around big shopping centres, and builds a reputation for exceptional service before expanding through franchise or other entrepreneur-led systems to create a business empire based on an intensely personal experience for both shopper and shop-owner.

High street shopping courtesy of Maxwell Hamilton

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Strikes and business

Posted by Michael under customer service

As Britain copes with the effects of the public sector strike called by four unions, the Chief Executive of the London Chamber of Commerce has gone on record, saying the strikes will harm business.

Around 750,000 public sector workers are on strike, and the range of interruption to business—from long delays at airports, to the need for parents to organise childcare or remain home with children whose schools are closed—is likely to have both immediate and more long term effects, possibly knocking on as far as the Olympics in 2012.

The London Chamber of Commerce predicts ‘… a nightmare for businesses as staff absence and losses in productivity will be inevitable.’

The Wall St Journal highlights the risk of harm to the UK’s inward investment, in a week when the Chinese Premier has been making happy noises about China investing more in the country, and points out that the dispute is likely also to divide the public.

For businesses, a ‘national’ strike can be a challenging scenario, but the smartest organisations are using the opportunity to re-invest or re-invent forms of work so that they can actually innovate around potential future scenarios.

Several of the largest UK firms have offered parents a ‘work from home’ day where they can focus on their annual appraisal or complete training modules and one of the biggest accounting and consultancy companies is urging both staff and clients to ‘Skype it in’, providing teleconferencing and other facilities so that business can continue as usual. It’s more difficult for freight firms and other large physical plant companies to find ways to get around such issues, but there may be opportunities for every kind of business to seek out savings or new technologies that will help them address a period of unrest.

Closed sign courtesy of charenton_

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Smart businesses have savvy social media…

Posted by Michael under customer service, Social Media

… but sometimes even the people who are supposed to know their stuff get it badly wrong. In the small but highly charged world of computer games, a bad review can be a substantial belly blow, but when a PR agency hit back, the story went viral.  The game was Duke Nukem Forever and the agency was the Redner Group, which responded to negative comments on the game previews by posting a tweet saying “too many went too far with their reviews. We r reviewing who gets games next time and who doesn’t based on today’s venom.”

While the tweet was swiftly removed, so was the game designer’s confidence in their PR choices. Redner Group no longer have a contract with the game company and as that was their biggest client, their future is looking less than promising.

The phrase coined to label this kind of behaviour is ‘social over-sharing’ – it means that a business or individual has lost sight of the boundaries that separate personal emoting and business communication and in the case of James Redner of Redner Group who posted the infamous tweet, he’s on the record as saying that he ‘felt like a father’ about the game and his overreaction was as a result of that emotional identification.

Dealing well with negative social media commentary

Social media is a two-way track. It’s more like a conversation than an ‘exercise’ so (a) you can’t control what comes back at you and (b) everything you say may be overheard by other people who respond immediately – be prepared for that! In the case of Duke Nukem Forever, journalists jumped all over the tweet as it looked to them like blacklisting. That may not have been Redner’s intention but when ‘conversation’ is ‘overheard’ there may be a wide range of interpretations that the business needs to recognise and deal with.

Define the problem. If you’ve got any constructive criticism at all, in amongst the negative stuff, say thank you. The revealing of genuine problems should always be something a business is grateful for. If you think the person has gone over the top, but there is some truth in their negative comment, try reframing the facts in more pleasant words and then respond to your reframed version. Example – ‘this product stinks: it took me four tries to put the thing together and the instructions are useless, too small and badly translated.’ Reframe – the product was more difficult to assemble than expected and the instructions are not as helpful as they could be. Response – thank you for pointing out that the instructions could be clearer: we will work on that. We’d like to know if you think better instructions would have made the assembly easier?

Trolling and Trashing. Trolling is the behaviour of online personalities who simply like to cause conflict. Trashing is where a person comments on your product negatively in order to promote a rival service or product. The only way to deal with trollers and trashers is to ignore their comments and remove whatever you can of their presence. The good news is that even determined trashers have a short attention span if you are on their case and don’t respond to them. Be sure they are a trasher though – one way to find out is to copy and paste their comments into a search engine: if you get identical hits appearing you know you have a trasher on your hands. Trolls are clever, manipulative and determined, but in social media terms, poorly tolerated so often you’ll find social media will patrol its own trolls and you just need to be on your guard against giving them the oxygen of publicity.

Troll image by meshmar2

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Making customer service work

Posted by Michael under Business Growth, customer service, Entrepreneur Resources, Leadership, Social Media

A recent article in Inc suggests an unusual approach for any business that has an intensive service profile: hotel and retail and personal services, travel and holiday industries and every form of catering to name but a few. The problem it seeks to address is the issue that if you’re giving great customer experiences to those in front of you, customers further back in the queue may be losing patience and eventually, you lose their business.

So what’s the answer? According to a study entitled ‘The Quality-Speed Conundrum: Trade-offs in Customer-Intensive Services’, published in Management Science, it’s simply to find the right balance between service and speed, and while that includes a complex algorithm or two, the bottom line is that you end up deciding how many people you can serve superlatively and limiting your service to that number.

This means that you set the price for the customer number that’s optimum and stick to that price/number ratio without reducing service by adding more customers. But how many of us can honestly do that?

Alternative approaches include outsourcing or crowd-sourcing non-customer facing processes so that you can concentrate on driving a customer service ethic from the top.

This means establishing an expectation understanding with your customers – where possible before they actually become customers – and setting up systems that check you meet those expectations more or less all the time.

•    Begin by deciding what you can do, what you can’t do, and what you do that nobody else can do. Should existing customers be addressed by name whenever they call? Do you want a random audit of customer satisfaction every month? What about mystery shopping? How will you handle complaints and suggestions for improvements? What will you do to reward loyalty?
•    Make sure your staff, but more importantly, your customers, know how and when they can access this customer service. There’s no point offering superlative service if it doesn’t work for the times when your customers can access it.
•    Ensure consistency in response – don’t agree you will call customers back by phone within 24 hours but allow a week to pass before responding to emails.
•    Be honest about failure – things will go wrong, and telling your customers (where possible, in advance) that you know there’s a problem, and what you’re doing to rectify it, goes a long way to turning a negative customer experience into a good one. If there’s a postal strike planned, make sure your website, facebook page, twitter feed and phone staff all know the details of your alternative delivery system. If bad weather or some other uncontrollable force knocks out your service team, be ready with a fall-back system like an outsourcing centre, and be clear to your regular customers that this is a fall-back and they may not get the consistent familiar service they expect from your organisation.
•    Offer alternatives – if you can’t do what people want, suggest somebody else who can. It sounds risky but it’s better to hand over a relatively happy customer than lose a disgruntled one: often they come back if you’ve done the decent thing.

Poor customer service image courtesy of Matthew Wilkes

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How negativity can lead to business success

Posted by Michael under Business Growth, customer service, Entrepreneur Resources, Leadership, Social Media

There used to be a deeply offensive joke that did the rounds in working men’s clubs accompanying a cartoon of a man in a smart suit with a speech balloon saying,  ‘The doctor says I’m impotent, so I’m going to dress impo’tent’. The addition of the missing letter gives the joke some sense: impotent or important?

One of the biggest stumbling blocks to new businesses is the way that issues come up and hit the executive team in the face. If there’s no team, just a solo entrepreneur, it’s his or her face that gets slapped with each new ‘important’ demand. A customer complaint needs handling with tact. A new contact has to be massaged into becoming a client or supplier. A competitor moves into the company’s space, challenging market share (or withdraws from a joint arena, offering the opportunity for business expansion) and a decision has to be made. Something trending on Twitter or Facebook seems likely to bring attention to the company, but somebody has to oversee the engagement process …

Some of these are important, some make you impotent. Focusing on the wrong ones is like stepping into a hamster wheel: the faster you move the faster you have to move, but you’re getting nowhere.

Negate the problem

Negativity means refusing to put time and energy into non-productive areas. Each business is different, and every set of priorities will vary, depending on the maturity of the business and the management style and ethos of the decision-makers, but decisions still need to be made. A maturing business be ready to say ‘No, our Founder or CEO isn’t going to deal with customer complaints, but we are going to invest in a customer service workshop to ensure all managers are ready to resolve complaints effectively’ while a new business might decide the boss’s time is best spent on face-to-face customer relations, so his or her energy will need to be removed entirely from social media. The key thing is that the decisions are made because one of the characteristics of a business that outgrows its success is ‘Founder Failure’ – where the entrepreneur’s inability to be equally focused on every aspect of the organisation leads to decline in the areas where he or she is trying, and failing, to maintain personal input.

It’s difficult for determined, committed, smart people to accept that some things are just distractions from their primary role. It’s tough to give up the personal touch, but business evolution requires certain kinds of negativity. Hiring a speech-writer allows a CEO to focus on business-building: a few personal touches added to a professionally written script are usually all that’s needed. Professional ‘ghosts’ manage social media for small companies, engaging with the public and transferring genuine complaints or concerns to the management team – it saves hours of trawling through tweets and Facebook comments and still gives the organisation a personal face.

Let go of the past

How often do you really need to be up to date with finance? Daily, weekly, monthly? Scheduling a one-to-one meeting with your finance manager (or just time to focus on your accounts for the really small business) is better than trying to stay on top of the money every minute of the business day. If you can’t relinquish that level of control you are building a bottleneck into business growth.

Did you start out as a techie with people skills and are you still trying to meddle with the techie side of business? If you’re the boss, it’s your job to delegate while remaining in touch with developments: trying to ‘do’ rather than delegate is one of the main reasons that new businesses don’t grow. Use your background to hire the best, not to be the best, and keep your energy for what the best techs can’t always do: building relationships, spotting opportunities and planning strategies.

Business to do wall courtesy of juhansonin

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Google’s latest algorithms go after content farmers and bad online retailers

Posted by Michael under Business Growth, customer service, Entrepreneur Resources, Leadership, Online Retail, Paid Search, Search, Social Media

Back in December, the Google algorithm was tweaked to deal with a surreal business scenario that was played out through the search engine rankings of an American eyewear retailer, the pages of the New York Times and the number-crunching desks at Google HQ.

Bad Retailers Punished

Essentially, one online retailer had realised that its many extremely poor online reviews and customer comments were actually pushing it up the search engine pages. So (it is claimed) it made an explicit company policy of ill-treating customers and abusing them when the complained, so that they would make negative ‘flaming’ online reviews which served to put the company at the top of the Google searches again, and again, and again.

When the NY Times wrote about this bizarre scenario, the comments redoubled and the company made the top spot on Google … at which point the Google mavens decided to do something. They designed a substantial revision to the search algorithm that stopped negative reviews driving a company up the popularity ladder.  How they did it has not been made clear, and there are still some questions about whether businesses can use this tweak to drive down their competitors by posting false negative reviews to drop rivals back down the rankings. Even so, the tweak made many online retailers happy.

Content Farmers Cut Out

In February a new algorithm, nicknamed Farmer, came into play, and now we’re seeing the results. The familiar name is the clue – this algorithm goes after content farmers who regularly top searches with content that is either derived from other sources (aggregated) or just packed with keywords (spammy).  This is meant to give more content-heavy, original-material sites a chance to reach the top 2 or 3 position, ahead of some of the sites that exist purely to link content to paid-for ads in the hope the viewer will click on them.

Together, these new algorithms herald a substantially different future for online retailers and information providers – they attempt to stop bad retailers using their poor reputation as a search engine tool and they aim to stop content farmers clogging up search pages with keyword-rich but content-poor information.

For many online retailers this heralds a new opportunity – the chance to revamp their own content format to deliver quality information and good customer engagement, not just for its own sake, but because it’s worth competing for a first page ranking again. Or at least it is for now, until the farmers and cowboys work out how to beat this new system …

algorithm billboard courtesy of toastyken

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