The Juggling Entrepreneurs

It is very important for businesses to understand their customers and their shopping habits.

EMarketer released a great article, “College Perfect for Word of Mouth“, that summarizes several recent studies on the methods Americans use to gain information about products.

A study by Youth Trends shows that the top two methods college students use to gain information about a product are word of mouth (friends & family) and TV.

Only 29.6% of people over 65 use there friends and family for product information.

From WOMMA Blog,

• 19% of teens’ word of mouth happens online, versus only 7% for adults.
• 75% of teens talk about media and entertainment.
• 68% talk about recreation and hobbies.
• 67% talk about technology.
• 65% talk about telecom.
• 62% talk about food and dining.

Posted by WOMMA Editor on August 8, 2007 6:22 PM

A new AWeber posting talks about a new feature in Hotmail. If you are not in the Hotmail user’s address book, no only do images not appear, but hot links to external web pages do not work either.

What is worse… the hot links in the email message show up in blue and are underlined, just like active hotlinks. When you click on them, they just don’t work.

For a great visual, visit AWeber’s post.

Who hasn’t heard of the new Apple iPhone?

Not many. AND most of it has been free.  If you google “iPhone” you will find it as a topic on many blogs, forums, and other Web 2.0 sites.  It has also been an article in most major newspapers.

This is the magic of the Internet.  Apple’s iPod is so successful, that it generated this free press for its new product automatically…. Everyone’s talking about it.

This is a great example of word-of-mouth advertising.  =-)

There is a of buzz about a new report by a new ScanAlert Study called “Digital Window Shopping: The long delay before buying” (get a free copy).

The study says, on average, a consumer takes over 34 hours to make an online buying decision (up from 19 hours in their 2005 study). This is significantly longer than if a customer were buying a product from a brick-and-mortar store.

E-commerce customers do research online before they make purchases. Not only do they do price comparisons, but they also seek out product reviews by experts and people who have purchased the product in the past.

This may account for some of the 60% shopping cart abandonment rate (MarketingSherpa).

Increase Your Competitiveness

• Excellent customer service reduces negative customer reviews. Bad news travels faster than good.
• Quick turnaround from customer ordering to delivery. The major corporations get products into the “mail” within 24 business hours.
• Regularly interact with your sales/customer service representatives to get feedback on what they need to better serve customers.
• Good exchange/return policy.
• Product web pages give information a customer needs to make a decision. Include product dimensions, product awards such as Consumer Reports Ranking, manufacturing warranty, product specifications/details.

Resources:

• ScanAlert study, Digital Window Shopping 2007
• Online Marketing slow to Generate Sales - new ScanAlert Study, WebMetricsGuru, July 10, 2007.
• E-Commerce Customers Today Taking Longer to Buy, StorefrontBacktalk, July 5, 2007.

Are you looking for a calendar that contains holidays of multiple countries that you can use for marketing?

AWeber posted such a calendar on their blog.  The calendar is in both HTML and iCal format for easy loading into your PIM.

In a recent Harris Poll, 91% of those interviewed said a store’s return policy is an important factor in making a purchasing decision (San Francisco Chronicle, “Customers want rules of returns clearly spelled out by merchants,” July 4, 2007).

A return policy was created to give customers the guarantee that the display models they see in stores (and images/descriptions they see online) accurately represents what they buy.

A return policy has more significance in purchasing decisions made online, than at brick-and-mortar stores because the customer cannot physically hold the product.

In your major store franchises, you will find the return policy clearly posted on a large sign by the registers and at the customer service desk.  An abbreviated version of the return policy is also written on a customer’s receipt.

On e-commerce websites

• Display a link on every webpage to your return policy.  Most online stores, such as AppleStore.com, have the link at the bottom of the page.
• If you have a long legal description of your return policy, create a summary section with key information and post it above the legal description.
• Include information about how shipping is handled for the returned item.  Do you pay for the shipping of the returned item?  Do you send a replacement item before you receive the returned item?  Do you include a shipping label in the the box with the replacement item?
• When shipping the product, include on a piece of paper or on the receipt your return policy.
• Train the staff that answers well how to handle returns and, more importantly, exchanges.  Use scripts and training sessions to run through different scenarios.

Example: A Return with L.L.Bean

I purchased a cross country ski package for my husband two years ago from L.L. Bean for Christmas.  It turned out the boots were too small.  I called L.L.Bean customer service.  The representative explained their return policy and immediately ordered replacement boots for me.  My credit card was charged for the replacement boots.  I would be credited for them when L.L. Bean received the boots I was returning - minus the cost of shipping the too-small boots back.

The package with the replacement boots included a shipping label I would use to return the other boots.  To return the boots that were too small, all I needed to do was pack the boots in the packaging the replacement boots were in and adhere the new shipping label and take it to the post office.

Would I use L.L. Bean again even though I had to pay for the shipping of the returned item?  Absolutely.

Why?

• A replacement was sent immediately.  I didn’t have to wait until I returned the original item.
• Customer Service that was friendly and could easily tell me how the exchange was done.
• A shipping label for the returned item was included with the replacement item.  There were two labels:  one for FedEx, one for Postal Service.  This allowed me to decide which method would be easier.
• The ability to use the same packaging that the replacement item came in to return my item.  All I needed was tape to close the box.

Last week, this blog was mentioned by AWeber in one of their postings.

The article was about providing email and web content that touches a reader’s everyday life - such as The Isolated Entrepreneur’s postings about postage increases.

Another good example about providing a personalized touch is Google. Periodically the Google logo changes to reflect an upcoming holiday or event.

The Isolated Entrepreneur changes its header to reflect different seasons. Currently the blog shows footprints on the beach. For Easter, it had easter eggs hidden in the grass.

Ideas for your business

There are things you can do to touch your reader’s lives.

• Change the color, images, or logo to reflect changes in season or highlight upcoming holidays.
• Add short notes to your newsletter about upcoming deadlines in your client’s industry.
• Change your phone or voicemail greeting to include such things as “Have a Great Weekend” or “Happy Holidays.”

I was in a local shopping area Friday on my way to a doctor’s appointment. In the main corridor there are several cars on display and a large sign for the local dealership.

These vehicles were covered with dust - at least a month’s worth. People wrote all over them. There was the usual “wash me” sign as well as several derogatory slogans.

Is this the impression the dealership wanted to make?

Advertising Needs Maintenance.

All advertising initiatives you make require maintenance - whether it is the occasional dusting of a car or the weekly submission of store specials to a local paper.

Every advertisement you place should be reviewed periodically for performance.   Your staff should ask customers where they heard about the business and record it so you can analyze what type of advertisement works best.

In the automotive industry, you see it quite often, competitors reacting to popular vehicle designs and features by copying them - after the fact.

If you didn’t look for the Chevrolet symbol, you might think someone driving a Chevrolet HHR is sitting in the better known Chrysler PT Cruiser.  Do you think investing the time and money was worth it for Chevrolet?  Did it increase GM’s market share or draw new customers to Chevrolet?  Not really - unless you count the GM and contractor employees who get GM discounts.

Is Copying a Competitor Ever Effective?

In some cases it makes sense to invest the time and cost in copying features your competitor created.

Take the minivan industry.  Most minivan customers expect a minivan these days to have a sliding door on both sides of the vehicle.  If the automotive manufacturers did not copy this feature, they would actually have lost market share.

This trend is repeating itself again.  Every year more minivan models have a feature where the third (and in some the second) row of seats can be folded down so that it makes a flat floor for cargo.  See Chrysler Town and Country Stow’nGo Seating.

Copying a competitor is only effective when prospective customers come to expect the new features.

It is Best to Stay Ahead of Your Competitors

Awaiting FCC approval, Apple is on the verge of releasing the Apple iPhone.  Many blogs and news sources rave about the iPhone being innovative and expect it to do as well as the iPod.

What do you think Palm (manufacturer of the Treo SmartPhones) is doing?  I can tell you they are not sitting still.  They just announced that they are getting a $325 million cash infusion from Elevation Partners and have added players such as Jon Rubinstein (former head of the iPod division at Apple) to their management team.

Apple’s iPhone is not the first competitor Palm has had to deal with.  Current Treo SmartPhone competitors include Motorola (Moto Q smartphone) and Canada’s Research In Motion (Blackberry).  Apple poses a new threat.  With the success of their iPod product, Apple has a large source of potential customers for the iPhone.

Palm’s new blood and money will hopefully drive the innovation needed to stay ahead of the industry.  The company is already working hard on rewriting their Palm operating system to compete.

Source: “Palm’s New Dough - and New Blood.” BusinessWeek, June 5, 2007.

What is Your Competitive Advantage

For small and micro businesses, your competitive advantage is to constantly keep up-to-date on the latest developments in your industry and to consistently review and update your business/market plan.  The best sources of information are trade shows and magazines and customer/employee feedback.  Where do you think the idea to have doors on both sides of the minivan came from?

Your competitive advantage is not to engage in price wars, but to focus on the factors that make your customers rave about you.

Resources:

• “Give Your Business A Competitive Edge“, NASE Successful Skills Workshop.
• “Spot the Next Hot Trend“, Mark Landsbaum, NASE Successful Skills Workshop.
• “Escape from Brand X: How to Build a Brand for Your Business“, Mary C. Weaver, NASE Successful Skills Workshop.
• “Starting Your Business - Conducting a Marketing Analysis“, SCORE Online Training Module.
• “Grow Your Business - Assess Your Current Status.” StartupNation.
• “Enhance Your Customer Experience.” Startupnation.com