Sunday, September 2, 2007

What We Can Learn From The Office

Thinking Small Can Make You Rich
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Say you're a small, semi-obscure paper-supply firm, under siege from the big boys: Staples, Office Depot-ever-expanding behemoths with bargaining power you can't match and Web-based customer interfaces you can't beat. Short of cashing out and going home, do you do? If you're Dunder Mifflin, you take a deep breath, throw open your doors, and invite the cameras in. You identify your most floundering, dysfunctional branch and offer it up to NBC to use as the subject of a warts-and-all documentary series.

To some, this might seem an act of corporate seppuku. Who wants their seemingly inevitable decline immortalized on tape? Generally, the market for Wall Street snuff films doesn't kick in until after a firm's Enron-like implosion. But since the documentary began filming, most of the employees at the camera-infested Scranton, Pennsylvania, branch have embraced radical transparency. After all, openness builds consumer trust, which will move any product-even dead trees. Why? Because "business is always personal," in the words of Michael Scott, regional manager at the Scranton office. "It's the most personal thing in the world."

Personal, maybe. Private? Hardly. So far, the cameras have captured everything, including Scott's gaping, baby-bird screeches for validation (yes, ladies, he's single!) and the high-wire romantic tension between assistant regional manager Jim Halpert and receptionist Pam Beesly. From cubicular microdramas (will adjutant, humorless sales agent Dwight Schrute ever learn to anticipate Halpert's daily pranks?) to ticking time bombs (who'll crack first, alcoholic Meredith or evangelical Angela?), the Scranton branch is a teeming reef of pungent humanity - individuals you can't help but care about, even at their pettiest and most paranoid.

But will transparency rescue a moribund business? Turns out, it already has - across the pond, at least. In 2001, a BBC film crew began following the worker bees of a midsize paper supplier based outside of London. When the documentary aired as a weekly series in the UK, the company's paper sales skyrocketed. "Office managers with purchasing power empathized with the employees' hopes and fears and errors and dreams and errors," explains Jan Levinson, Scott's supervisor and director of Dunder's mid-Atlantic operations, who helped bring the concept stateside. "Um, did I say errors twice?"

No one understands - and embodies - Dunder's blunders more than the hapless Scott. His tactless, childish management "style" is often inappropriate and occasionally illegal. Will Americans embrace a guy so eager to please that he authorizes the hiring of a stripper for an in-office bachelor party? "Yes, because I showed I learned something," Scott explains. "I learned that letting a stripper sit on your lap is wrong, especially if you have a girlfriend - who's also your boss. My boss. Jan Levinson... My boss with benefits." He winks. "Sex benefits? I also learned that honesty is not such a lonely word, as I think Billy Joel said, but is, in fact, the best policy... which I think Shakespeare said. Or Jesus."

You're right, Michael: Honesty may be the best - and only - policy these days for Dunder Mifflin, an embattled underdog that can't help but be itself. The Scranton team maintains a boutique regional clientele on the strength of their sweaty-palmed, oddball intimacy - at once their biggest liability and best asset. "David will always beat Goliath," Scott recently thundered to a business school class. After being reminded that Dunder faces not one but five huge competitors, he replied, "You know what else is facing five Goliaths? America: al Qaeda, global warming, sex predators, mercury poisoning." He paused, appearing to lose count, then rallied: "So do we just give up?"

Give up? No. Fess up? Yes. Because in this new era of radical trans parency, the way you sell paper is by showing the world that you're not above getting reamed. "That's what she said!" laughs Scott. "That's a sex joke. But not about my boss... with benefits. You know what?" He looks into the camera. "Can we do that part over again?"

[via wired.com]


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Tuesday, June 5, 2007

The Basics of Building an Online Business


The Basics of Building an Online Business

As an internet marketing guide, a lot of people ask me how to start and grow an online business. I tell them this: There's a proven sequence of steps you can follow to guarantee your success. How do I know? I've seen thousands of people start and grow online businesses following the same exact process.

Step 1: Find a need and fill it.
Most marketers make the mistake of finding a product before they have a market. But unless people are actively searching for your product online, you'll never make a sale. The trick is to find a group of people with a common problem they're trying to solve and then solve it.

Thankfully, the internet makes market research easy. Here are some easy steps for researching your market:

  • Visit online forums to see what questions people ask and what problems they’re trying to solve.
  • Figure out which keywords a lot of people are searching but not many sites are competing for.
  • Check out your potential competitors by visiting their sites and taking note of what they’re doing to fill demand.

After you've done this, use what you’ve learned to create a product for a market that already exists--and do it better than your competitors.

Step 2: Write sales copy that sells.
On a website, your copy has to do the selling for you. There’s a proven formula for writing sales copy that'll take visitors through the selling process from the moment they arrive:

  • Arouse interest with a compelling headline.
  • Describe the problem your product can solve.
  • Show them why you can be trusted to solve the problem.
  • Add testimonials from people who've used the product.
  • Talk about the product and how it benefits the user.
  • Make an offer or a guarantee.
  • Create urgency.
  • Ask for the sale.

Throughout your sales copy, focus on how your product or service is uniquely able solve people's problems or make their lives better. Think like a customer and ask, what's in it for me?

Step 3: Design and build your website.
Once you’ve got your market and product and you’ve nailed down your selling process, you’re ready to build your site.

Remember to keep it simple. Your website is your online storefront, so be sure to make it customer friendly. You have less than 10 seconds to grab a visitor's attention before they're gone. Some important tips to keep in mind:

  • Use a plain, sans-serif font, like Arial, on a white background.
  • Make your navigation clear and simple and keep it consistent throughout your site.
  • Only use graphics, audio or video if they enhance your message.
  • Include an opt-in offer so you can collect e-mail addresses.

Step 4: Use search engines to drive targeted buyers to your site.
How do you get traffic to a brand-new site? Pay-per-click advertising, which has two advantages:

  • The ads show up on search pages immediately.
  • They allow you to test different keywords, headlines, prices and selling approaches.

Not only do you get traffic immediately, but once you've figured out what keywords are working best, you can use them throughout your copy and code, which will help your rankings in organic search results.

Step 5: Establish an expert reputation for yourself to drive even more traffic to your site.
People use the internet to find information. If you provide valuable information for other sites to use--and include a link back to your site--you’ll get more traffic and better search engine rankings. Some ideas for establishing yourself as an expert include:

  • Give away free content, like articles, videos or other useful information, and distribute that content through online article directories and social media sites.
  • Include “send to a friend” links on your site's valuable content.
  • Become an active expert in industry forums and social networking sites where your target market hangs out.

If you use these tactics, you’ll reach new readers. But even better, every site that posts your content will link back to yours, and search engines love links from relevant sites and will reward you in the rankings accordingly.

Step 6: Use the power of e-mail marketing to keep in touch with your visitors and turn them into buyers.
When you build an opt-in list, you’re creating one of the most valuable assets your online business can have--permission to send visitors e-mail. Why is e-mail marketing so valuable?

  • You're giving potential customers something they've asked for.
  • You're developing lifetime relationships with people in your target market.
  • The response is 100 percent measurable.
  • It's cheaper and more effective than print, TV or radio advertising because it's highly targeted.
  • It can be almost entirely automated.

Anyone who visits your site and opts in to your list is a very hot lead. And there's no better tool than e-mail to let you effortlessly follow up with those leads.

Step 7: Increase your income through back-end sales and upselling.
One of the most important internet marketing guidelines is to develop every customer’s lifetime value. At least 36 percent of people who have purchased from you once will buy from you again if you follow up with them. Closing the first sale with a customer is by far your most difficult task--not to mention your most expensive one. So here's how to get them to buy again:

  • Offer products that complement their original purchase.
  • Send out electronic loyalty coupons they can redeem on their next visit.
  • Offer related products on your "thank you" page.

If you reward customers for being loyal, they'll become even more loyal to you in return.

Step 8: Start an affiliate program to maximize your sales and revenue.
Once your business is up and running, it's time to launch your affiliate program. Affiliates are people who promote your products on their sites for a cut of the selling price. Every time they send you a buyer, you pay them a commission.

An affiliate program is a simple, low-maintenance way to grow your business. Once you get your program set up, all you have to do is share your marketing materials with your affiliates and send out checks when they make sales.

By doing this, you don't have to go out and spend money on advertising--your affiliates do the advertising for you. Better yet, you only pay them when they make a sale.

The internet changes quickly, but the principles of how to start and grow a successful online business have changed very slowly in the more than 10 years I’ve been in the business.

If you’re just starting out, stick to the sequence of steps in this quick guide. If you’ve been online awhile, do a quick review and see if there’s a step you’ve been neglecting or never got around to doing in the first place. You can’t go wrong with the basics.


Derek Gehl is Entrepreneur.com's "E-Business" columnist and the CEO of the Internet Marketing Center, an internet marketing firm that has helped thousands of people learn to start and run their own online businesses.He has just released the 2007 edition of his comprehensive Internet marketing guide, The Insider Secrets to Marketing Your Business on the Internet.


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Saturday, June 2, 2007

GPSDude Maps Out Success


What is Google's Supplemental Search Result and How to Deal with It.

With apologies to "The Big Lebowski": If you're in the market for a GPS unit, the Dude will do plenty more for you than just abide.

Jay Moore, a.k.a. the "GPS Dude" of GPSDude.com, has been at it for over four years now, with steady revenue and site visit increases every month. It's about three and a half years longer than he ever thought he'd be advising on and selling satellite-based navigation devices to consumers.

"I initially thought, if I make a little money, great, but I'm only going to have it for a little bit of time," admits the 40-year-old Moore, who holds an MBA and has also been doing business consulting since 1990.

It was a drive to help his consulting clients enter the online marketplace that got Moore interested in starting GPSDude.com, which he still calls an "experiment" — an internet laboratory to test e-commerce methods, using his own money, from which he could report back successes and failures.

"It was an incubator, and it still is," says Moore, who lives near Cincinnati. "I'm constantly looking at things." Choosing to sell GPS devices came easily; Moore spends a lot of time outdoors, and has used a GPS device wherever he goes for years.

Opportunity Knocks

But it was also financially appealing. The GPS market, led primarily by Garmin and Magellan, was exploding five years ago, yet big-name retailers were slow in catching on. Moore also figured out he could drop-ship the units online (relying on third-party distributors to fulfill orders; he now has five), and keep prices high enough to offset shipping.

Moore now sells 300-400 units per month, enough to push him towards $1 million in annual sales. But the secret to his success isn't technological at all — rather, it's old-school customer service.

The most popular feature on GPSDude.com is "Ask The Dude," where visitors can fill out a query form and receive advice from Moore or his one employee on which GPS unit to buy, depending on the customer's needs and budget. And, it works, pure and simple: 75 percent of these customers are converted to sales.

"All that most of those folks want is a little personal contact," says Moore. "When we send an e-mail out, my name's on it."

He doesn't stop there, though. Aside from military personnel and traveling salesmen, many of his prospective buyers are retirees — Moore admits pleasant surprise at the 70-something set's Web proficiency — who want GPS units for road trips.

Selling to the Senior Set

More often than not, retirees fill out the online form but request a call back instead of an e-mail. "There's not a high level of trust with Internet retailing," says Moore. "If I talk to them on the phone, it's a guaranteed sale. Unfortunately, there's just not enough time to talk to everyone on the phone!"

All purchases are made by credit card online, never by phone, with PayPal Merchant Solutions processing charges. Last July, Moore switched his hosting solution from Monster Commerce to ProStores, another eBay-owned company.

"I liked the fact they were integrated with PayPal, and they're affordable," says Moore of ProStores. "I figured we wouldn't have any problems long-term with them being in business. Hosting companies are like a lot of Internet stores, you don't know who owns them, or how long they're going to be there."

As for his storefront, Moore likes to keep his site navigation as simple as possible, separating out his left-side menu by brand (he sells seven at present) and model. Yet he still wants to improve its functionality, and better connect customers to their ideal GPS units. "I haven't found a great way to do that yet," he admits.

Viral Marketing is Catchy

Marketing his site, which costs him about $2,000 per month, has also been a mixed bag thus far. Moore uses Google and Yahoo search-term services, although he says they result in few sales. He also places ads in print publications, including RV magazines, military publications and newspapers, and spends many hours posting responses with his name in popular GPS online forums and bulletin boards — a viral marketing technique he feels is most effective.

Regardless, Moore continues to focus most on providing superior customer service, advice he also continues to give his consulting clients, as old-fashioned as it sounds.

"Like any business, I have to get my name out there," Moore says. "I'm going to be a failure if I try to compete on price; at the end of the day, Wal-Mart is going to sell it cheaper than me.

"I'm attempting to build a brand, in this case, The Dude, that some small segment of people will recognize and buy from."


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Monday, May 21, 2007

Using Social Networks


Promoting on a Budget

From The Wall Street Journal Online

The social-networking bandwagon is getting awfully crowded.

For companies looking to better connect with consumers and build brand loyalty, social networks are increasingly looking like the ideal tool. Users get a forum in which to share information, pictures and videos about themselves and their likes and dislikes -- and, companies hope, talk up a product. Companies, in turn, get real-time feedback on trends and products. And they can even bounce off ideas still in the works.

The incentive is obvious: People are flocking to social-networking sites like MySpace and Facebook, according to Web-tracking service Nielsen/NetRatings. MySpace, which is owned by News Corp., got more than 53 million unique visitors in November, making it the seventh most popular site on the Internet, while privately held Facebook got about 11.6 million visitors.

Social networking is "even more targeted than online advertising," says Rachel Hoenig, co-founder of New York marketing firm Digital Power & Light. Banner ads gave companies the chance to change ads quickly and direct them a bit better, "but banner ads are still one-way communication," she says. By contrast, social networking is more of a dialogue between the user and the company, she adds.

One natural area for social networking seems to be sports. After all, sports and the hottest sports apparel and equipment always get people talking.

The National Hockey League, for instance, has set up a social-networking site, NHL Connect, where hockey fans can create personal profiles, add friends, upload photos, post videos from YouTube, make comments and join chat groups. The site also has NHL news, game schedules and the ability for users to look up other fans based on their favorite teams and players. In addition, the site links to blogs by contributors as well as team blogs for the New York Islanders, Anaheim Ducks and others.

"Our fans have, for years, expressed their points of view on our game through message boards, chat rooms and blogs," says Keith Ritter, a spokesman for the NHL. "If we didn't provide the tools that our fans want, they would migrate to a place that did." He adds that the NHL doesn't have traffic or membership numbers for the site.

Over the summer, sports-apparel maker Nike Inc. set up a social-networking site, Joga.com, for soccer enthusiasts. The site, built with some technical help from search engine Google Inc., encourages local soccer groups to sign up and create profile pages. Fans can blog, create communities around particular teams or players and organize local games. The site also includes pictures and exclusive video, profiles of famous players and articles about various styles of play. Nike says that by the end of the World Cup games last July, Joga.com had attracted one million users, the most recent data the company would disclose.

Even a maker of gym equipment is getting in on the action. LifeFitness, which makes treadmills, weight machines and other fitness equipment, allows individual gyms to set up a LifeFitness site to create a sense of community around that gym -- and, of course, make exercisers more aware of its wares.

Raj Rao, divisional vice president at LifeFitness, says gyms have a big problem with customer attrition -- typically losing about a third of their clientele each year -- because people feel "they don't have any relationship with other members."

LifeFitness, a subsidiary of Brunswick Corp., based in Schiller Park, Ill., aims to change that by allowing users of its sites to create their own profiles and list fitness goals, workout regimes and other personal information. Like-minded users can then find each other on the site to swap workout tips and challenge one another, among other things. Users also can share workout information -- duration of workout, weight lifted, calories burned, heart rate -- with a sports club's trainers to make sure their workout habits are right for their fitness level and targets.

People also love to talk about where they've traveled or get others' insights on where to go and what to do next. So some airlines are creating social-networking sites to help users give -- and get -- feedback and advice to manage their travel time wisely.

Franco-Dutch airline Air France-KLM launched a social-networking site earlier this year aimed at business travelers to China, called Club China. The site offers members tips on doing business in China as well as assistance on tasks like finding a translator or car service. Members also get perks, such as admission to China Club, a country club with locations in Hong Kong, Shanghai and Beijing.

Once users set up their profiles on the site, they can search for prospective business contacts based on industry, home country or company size. They also can find other club members who are traveling at the same time, attending a particular conference or trade fair. One Club China member is Arie Herweijer, regional sales and marketing manager at HITT Traffic, a Dutch maker of traffic management and navigation systems, who travels between the Netherlands and China about 11 times a year. Mr. Herweijer says he finds the site useful for finding contacts he might not otherwise come across.

"China is hot," says Vikram Singh, director of customer relationship management at KLM. "KLM has its own ambitions to serve China....We thought it would be good to step in and facilitate in whichever way we could to connect customers." Club China boasts about 3,000 members, with about 40% of members logging on every month.

Mr. Singh says the Club China site was initially set up as a value-added feature for members, but the company finds that it's increasingly getting valuable feedback about its own services. Customers might make suggestions about, say, putting in more-comfortable chairs at a certain airport lounge or adding a better selection of magazines. Mr. Singh says Club China users "can ask for virtually anything" on the site's open format forum.

A frequent flier in economy class, Mr. Herweijer often makes comments on the site. He hopes that with his frequent patronage and activity on Club China, he might get an occasional perk like a small glass of wine or upgrade. It hasn't happened yet for Mr. Herweijer, but "I keep pushing that," he says.

KLM also recently launched other sites with similar features: one targeting golf aficionados, Club Golf, and another for frequent travelers to Africa, called Club Africa.

To make a social-networking site succeed, marketing is essential, says Ms. Hoenig of Digital Power & Light.

When Nike first launched Joga.com, it simultaneously launched an ad campaign promoting the site. For instance, tags on Nike merchandise had Joga.com inscribed on them and invited people to join the site. Since then, the company has relied on online word of mouth, a Nike spokeswoman says.

Yet even with publicity, not all social-networking experiments are sure bets. Some say retail giant Wal-Mart Stores Inc. made some missteps when it set up a site, called The Hub, for middle- and high-school kids to promote last fall's back-to-school season.

Peter Cashmore, editor of Mashables.com, a blog about social networking, says that starting with the tag line "School, my way," the site didn't come off as believable and sounded like a company trying too hard to be cool. He adds that some profiles seemed more like ads for the company.

Another thing, he says, is that the site tried too hard to control its user base. For instance, the site would ask kids that signed up for their parents' email to get the parents' permission. While some sites targeting younger kids do this, larger and more popular sites such as MySpace and Facebook do not explicitly ask for parental permission.

Mr. Cashmore says Wal-Mart's move "was a little too much" and seriously limited the number of users it could sign up. While seeking parental consent has value since exposing your online identity is risky for anyone, a closed network is unlikely to experience the viral growth of MySpace or YouTube, he says.

A Wal-Mart spokeswoman declined to comment on the site, saying only that it was intended to be temporary for the back-to-school season. The site closed down after 10 weeks on the Web.

Experts who have set up social-networking sites say sometimes the biggest obstacle for companies is overcoming corporate arrogance. Many companies underestimate the amount of work needed to maintain the site once it's up.

Unlike a traditional site, which can be set up and then updated from time to time, the content on a social-networking site is constantly changing to stay current and to deal with customer feedback. A site that stays static is a problem, since users will get bored and stop visiting. What's more, if any criticism isn't dealt with quickly, it can put a dent into a company's image. And if customer chatter turns nasty, the company needs to be prepared to react quickly. On the other hand, a company that tries too hard to control its image on a site can come across as fake.

Companies also shouldn't read too much into things. Feedback from a site isn't a substitute for true market research, says Scott Gilbertson, the former interim chief executive of retailer J.Crew, who has since started his own firm, Ludi Labs of Mountain View, Calif., which focuses on social networking. The online audience may not be representative of a company's entire customer base, so data are likely to be statistically skewed, he says.

Email your comments to sjeditor@dowjones.com.


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