RonTester, Author at Do This Not That Marketing

October 20, 2015 by RonTester Leave a Comment

Hiring a Business Consultant for Small Businesses: Pros and Cons

When people ask me whether hiring a business consultant is a good idea, I am torn.

My answer is usually “it depends” or “maybe.” There are so many red flags. As a business owner you may have identified problems in your company, yet you just can’t figure out how to get over that particular hurdle. Perhaps you can’t quite pinpoint what would make your business run more efficiently. Or maybe you have a project that only requires someone for a short period or a specific task. Hiring a business consultant can help you tackle these problems more efficiently and improve your bottom line. At the same time, many of the consultants I have hired have been terrible, costing a lot of money and not helping me very much. Working with the wrong consultant feels like speeding down the highway throwing money out your car window. I hated that for me and I would hate that for you. So let’s take an in depth look at the pros and cons of hiring a business consultant.

PROS

First, a good business consultant (or consulting firm) can help find and implement solutions to problems you have already pinpointed in your business. If you keep banging your head against a problem, a business consultant might be able to get you over, around, or through that problem. If that’s what you’re looking for, make sure when you are interviewing potential consultants that you ask that person for their specific experience in addressing this type of problem. “Just to make sure we’re on the same page, I’d like you to share three to five times you’ve worked with a company like mine to address a problem like this. What went well? What went poorly? What were the main reasons those projects succeeded or failed? Of course I don’t want you to reveal any private or proprietary information.” If they can’t give you at least three projects they’ve personally worked on like yours, be very careful. If they can’t give you any, but talk about how their firm “has been doing this sort of work for 87 years,” RUN!

A good business consultant can also guide you and your business in a direction needed for greater growth and efficiency. By mapping out a clear cut plan, business consultants can give you feedback about your goals and, if appropriate, can help get you to your next goal. A good business consultant should always be looking for the right opportunity, making sure you have the right resources to achieve the goal, and making it clear how they are going to provide you with the right solution for your problem. Do NOT settle for glittering generalities or base your hiring decision on hope. As former Mayor of New York Rudy Giuliani once famously said, “Hope is not a strategy.”

Business consultants can also provide a sounding board for business owners. If you are going to use a business consultant as a sounding board, make sure they have either worked in companies like yours, consulted with companies like yours, or preferably both. I once hired a consulting firm dripping with MBAs. I figured these guys were the masters of the universe so they would obviously have all the answers to my problems. The problem was NONE of them had ever worked for a small business like mine or done enough consulting in businesses like mine to offer me real, helpful advice/feedback/guidance. Their advice might have been helpful for a hundred million dollar company, but not for a five million dollar company like mine.

Another potential advantage of business consultants is the ability to reduce overhead. Some projects may only require a certain amount of time. Hiring an employee in this case could be costly due to labor burden (insurance and benefits, etc.), work space, and more. By hiring a consultant, you only use them when needed and thus save on paying a salary for the same type of position had you hired an employee. Remember though, consultant fees vary based on the work, so weighing the length of time needed and type of consulting required are important factors in deciding on hiring a consultant.

CONS

The biggest potential disadvantage of hiring a business consultant is hiring the wrong one. That’s painful and can be costly in terms of morale and money. If their advice is misguided, it could actually sink your company, so be careful. Another potential downside is consultants can create a relationship of dependency for businesses. In this case, the business owner spends more time and money with the consultant and thereby the business ends up losing money. Let me be clear, in the long run, the wrong consultant can end up costing you truckloads of money. Being clear about the specific problems you need help with, checking out references, and performing a rigorous interview is crucial. If the potential consultant bristle at your vetting process, move along. You’re not hiring a best friend, you’re hiring a consultant to have a positive impact on your bottom line.

The bottom line: consultants can be an important member of your business team, especially in situations where hiring a full time employee for a particular project would be overkill. Weighing your options and your business needs is paramount when deciding on whether or not to hire a business consultant. Take enough time to know exactly what problem you want to address, what goal you want to achieve, and why you think hiring a consultant may be the best option to fix the problem or achieve the goal. Once you know those things, you can decide whether hiring a consultant is really the best thing for you, and you can find the right consultant for your situation.

When people approach me by asking why they should hire me as a consultant, my response is something along the lines of, “I don’t know. Maybe you shouldn’t.” Until both of us know your specific needs and situation, neither of us has any idea whether I can help you or not. Neither does any other consultant worth his or her salt. Don’t be bamboozled. As a small business owner, you’ve worked to hard to let someone else screw this up.

If you’d like to discuss your situation and see if I might be able to help you, please email me so we can set up a time to talk. If you’re afraid I’m going to try to smooth talk my way into some sweet consulting gig, don’t worry. I won’t. I’ve been in your shoes and I know what it’s like.

October 15, 2015 by RonTester Leave a Comment

The Benefits of Marketing Your Small Business

You Should Be Thinking About Marketing All the Time

In my previous article “What is Marketing,” I defined marketing as any action you take to put your service or product in front of your customers. The ultimate benefit of marketing may seem obvious, but I am going to spell it out here. If you don’t market your products or services, you will probably not have enough of the right kinds of customers. And if you don’t have enough of the right customers buying your products and services, you will go out of business. And if you go out of business, you won’t be able to serve to people/businesses/customers you were meant to serve. That would be a real shame. I see too many businesses where the “grand opening” sign is replaced by a “going out of business sale” sign within the year. I don’t want that to happen to you. So think about your marketing. It will drive everything else in your business. IN here are specific, clear benefits to marketing your product or service. Let’s take a look at them.

Brand Recognition

Enhanced recognition of your product, service, and/or brand. Creating an effective marketing strategy helps place your brand into the minds and eventually the hands of your customers. When you think of a soda company, a particular brand comes to mind. You recognize their logo, their slogan, and their theme song. Branding is one benefit of marketing that will help get the phone to ring. At the same time, if you’re a small business, I highly discourage you from making branding a primary goal of your marketing efforts. It costs a ton of money to effectively brand your product or service on the scale of a Coke or Pepsi, and that’s money you could better spend doing something that will more directly help you to get more customers. When it comes to your marketing plan, branding should be a secondary goal for most small businesses, not a primary goal.

Target Your Customer Base

As you are establishing your brand, marketing helps you identify and target your customer base. By targeting the types of people your service or product will benefit, marketing will help get new customers and keep the ones you have. It will also help pinpoint where to spend your marketing budget by targeting potential clients instead of spending money marketing to just everyone. Here’s the key though: you have to track where your customers are coming from. If you’re like most small businesses, you don’t need a fancy tracking system. Simply train everyone in your business to ask new prospects or customers, “How did you hear about us?” Then jot it down on a piece of paper.

For example, if I am running an ad in the newspaper and radio, my tracking sheet will have the following columns: newspaper, radio, walking by, referral from customer, referral from employee. Once the prospect or customer tells me how they heard about me, I make a check mark or tick under that column. At the end of the day, I can see that 2 customers heard about me on the radio, 43 read about me in the newspaper, 4 customers were referred by a current customer, etc. With good data (which would obviously need to be more than one day’s data), I can decide whether to keep running the radio ad, incentivize current customers to refer, etc. But this only works if I know where my customers are coming from. (As a side note, I realize this is a simplistic was to get started and it would be helpful to track sales/profit per lead type. You can get there eventually, but starting simple is better than waiting to deploy the complex system.)

Communicating Through Content Marketing

Communicating with your customers as well as providing information and establishing trust are valuable aspects of marketing. The best way I know how to do this is through content marketing. Sharing great content with your audience shows your level of expertise in your field and helps your audience to trust you. Also, by providing relevant and valuable content, you are communicating with your customer base. Information about your industry and your product or service helps your potential customers know whether you are the right person or company to meet their needs. Remember, for most small businesses, you don’t want just any customers, you want the right customers. If you sell the wrong solution to the wrong customers, they may be disappointed in what they receive and go tell everybody on Facebook, Twitter, LinkedIn, etc. In the long run, the wrong customers will do you more harm than the short run revenue will do you good.

Remember, people do business with people they know, like and trust. Everything you do for marketing should be so your target audience will know you, like you, and trust you. It’s important that you note I said your target audience. If you make people outside of your target audience unhappy, don’t worry about it. In fact, sometimes that can galvanize your target audience’s support for you. Think about any specialized brand or service that has a passionate following. If they have raving fans, they probably also have detractors. Don’t let that worry you. Make your audience happy and don’t worry about the haters.

Marketing: Save Time and Money

Effective marketing not only makes you money, it saves you time and money. When you find the right target audience, you can establish your brand while getting the word out to the right people while avoiding spending time and money reaching people who don’t want or need your product. Lipstick companies advertise in Marie Claire, not GQ.

If you’re not thinking about marketing all the time, now is the time to start. Yes, a business needs effective people and processes, but helping your target audience know about and experience your product or service is the best way to ensure sustained success.

If you’re like a lot of small business owners, you may not know where to start. 15 years ago, I was in your shoes, and I know how overwhelming it can feel. My recommendation would be to start small, somewhere, and test to see whether you are getting the results you want. If you aren’t sure how to do that, or would like some help to lessen the uncertainty and stress, please email me and we can talk about how I can help.

October 15, 2015 by RonTester Leave a Comment

What is Marketing?

Marketing: what exactly is it and why is it so important for your small business?

Marketing involves any action you take to put your service or product in front of your customers and potential customers. The great thing about marketing is that, when done well, it makes you money by meeting your customer’s wants and needs. Marketing includes researching and targeting as well as communicating with your customers. Some people think about marketing as advertising or public relations. It is, but it’s a lot more than that, too. Advertising and public relations are just a part of a comprehensive marketing plan.

With target marketing, businesses can pinpoint their audience. John McCarthy revised Neil Borden’s idea of the “ Marketing Mix” and observed that there are four variables within a business’ control to target their customers. These are referred to as the Four P’s of Marketing: product (or service), pricing, placement, and promotion. Where these four ingredients overlap, your target market can been identified.

Another model for target marketing is Robert Lauterborn’s Four C’s of Marketing. This model of target marketing centers on the consumer rather than the producer. The Four C’s of Marketing include Consumer wants and needs, cost to satisfy those wants and needs, convenience or ease of buying, and communication. For smaller businesses, using the Four C’s of Marketing is usually a better way to establish a two-way relationship with their desired audience.

Marketing comes in a variety of forms these days. The oldest and most familiar form of marketing is word of mouth, in which customers simply tell others about the experiences they had with a particular business, product, or service. Another form of marketing includes direct marketing. With direct marketing, businesses have direct contact with their audience through promotional material via mail, email, texts, and fliers. Some companies utilize promotional marketing through contests, coupons, or samples.

Marketing through social media has quickly become a popular means of marketing to customers. Larger companies have created special departments for social media marketing where the employees’ main responsibility is to communicate with customers through social media. Another more recent form of marketing involves mobile devices, allowing for location and time sensitive promotions. With these and many other forms of marketing, creating a plan to incorporate them will help focus your business’ resources.

While marketing can be expensive, creating a marketing strategy for your business is crucial to your business’ survival. Using a variety of forms of marketing gives your business the best chance, but the form of marketing you choose should be based on reason and evidence and not picked haphazardly because “that’s what to competition is doing.”

To recap, marketing targets your audience and establishes a relationship with them. If you’re not marketing your business, your business’ growth will be limited and likely will become stagnant. Marketing allows your business to find more customers and clients and allows for them to find you as well. It’s what we all want, right?

Have you taken a hard look at your marketing recently? Are you doing more than ads in the newspaper or the occasional tweet? To be the most successful, you need a comprehensive plan that you can implement consistently. If you’re not sure how to do that, please email me and let me know how I can help.