Desty Online -- Online and Offline Businesses, Online Marketing » Business

When Just Providing a Sevice or a Product is Not Enough

Desty — Thu, 25 Oct 2007 15:03:00 +0000

When starting a business, generally, the value created by the business can be broken down into two areas

Product or Service — You provide either a new product or service, or you are providing a higher quality product or service.
Price — You can undercut all other competitors and still have a reasonable level of quality in relation to price.

All business can be boiled down to the value added to customers, but that is only half of the battle. Customer has to realize two things

They need the product or service
The product or service exists

That is where marketing comes in. Word of mouth, advertising, etc. You can have the most amazing product in the world, if no one knows about it, how many have you sold? Not only must you call attention to your business, but you must also demonstrate how your service will enhance the customers’ life or make their lives easier.

Quality of Marketing

Which product would you be more likely to buy, the product advertised during Grey’s Anatomy with a flashing commercial staring Nichole Kidman, or the late night 1-800 commercial where you can buy now for $19.95 and get a free set of knives? The products could be 100% the same, the only difference being a brand name and the marketing behind the product.

There can be such a thing as too much hype. Take Blogrush for example. I like Blogrush; I use Blogrush. Blogrush had two problems when it was released last month.

The process for the actual system was still in beta. Too many spam sites were allowed into the network.
Massive hype. Everyone and their sister were talking and pushing Blogrush.

Had Blogrush been released in it’s final form (which is still isn’t) with all the hype, it would have been a smashing success. On the other hand, if it had been released exactly as it was but without the massive marketing push behind it, I think everyone would have been alittle more tolerant of its issues and allowed it to grow naturally.

Is It a Catch 22?

When it comes to releasing a new product or service to the public, which model do you follow? Wait until the product is as perfect as it can get without massive testing and feedback, or release when it’s functional and make adjustments on the fly?

I think we all know what happens when an unready product is released, it gets ignored and damages any chances of success down the road. First impressions matter. If you provide an inferior product, people will always refuse to associate with that product due to it’s past history, no matter that it’s been totally revamped and a massive marketing campaign gets put behind it.

I, however, can sympathize with the other problem. With my new project aged 1 week into actual virtual existence, even though it is live and anyone could visit and check it out, I have done zero marketing beyond Technorati tags and pings. Traffic has been next to nothing, to which I am glad. We’re not ready yet. I think the idea has merit, but due to my lack of extra time to fully develop it, I make small additions and changes everynight. Also, I crave feedback. I would love to have someone else look at it to get an outside opinion. I guess that’s where alpha and beta testers come in.

Blogrush, business, product testing, marketing,

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Be Prepared to Stick With Your Business For the Long Haul

Desty — Wed, 11 Jul 2007 18:16:18 +0000

We’re a society in trouble. In just two to four generations, we’ve gone from a hard working, industrious nation to a culture that refuses to wait. We want something and we want it now mister! Gone are the days of starting something, be it jobs, relationships, investments, or hobbies. Too many people want instant results.

~~Refuse to Lose~~Everyone’s a Winner

There are several reasons for the decline of our population’s lack of patience. As I was getting ready to leave school in the late 80’s, a movement was starting where it was considered wrong to tell a child he was wrong, incorrect, or lost. This was start of the notion that there were no losers, everyone was a winner! Competition was bad. Psychologists were so concerned with a person’s self esteem that teaching started to revolve towards giving a child the idea that he wasn’t wrong or lost, that it was ok.

With failure becoming permissible, quitting was no longer a big deal. You don’t like something after trying it once? Fine, go ahead and quit. Calculus 201 too hard, drop it. The first scheduled softball practice too hard or the coach made you run some laps? Don’t go back.

~~If You Don’t Succeed Right Away Go Ahead and Quit~~ Pay Your Dues

While its now acceptable, from a culture standpoint, to expect a holding-your-hand treatment, the business world does not work that way. In business, only the strong survive! In not only with customers, who believe they’re entitled to the best products at the lowest prices, but in B2B (business to business) transactions, if you can’t deliver on time, give quality customer service, or provide a competitive product, forget about it! There is no second place. You don’t like that, going to quit? Fine, there are two more companies right behind you that will work and will hustle for the business. Keep these following points in mind when you run into obstacles in business:

Pay your dues – don’t expect to hit a home run the first time at bat. There are companies out there that have brand recognition and years of goodwill built with their customers. Unless you can really wow the customer, and I really mean WOW them, you’re going to have to build your business one customer at a time.
Prepare to fail – before you even start your business, you must expect to lose and throw your money out the window for the first three years. It usually takes one to two years for a start-up business to break even. Plan for the worst case and you’ll be ready should it take longer to make a profit.
Treat every customer like your business depends on them – having a higher price than average can be acceptable if your customer service warrants it. It’s not enough to treat the customer as if they were #1; you must treat the customer as if your existence depends on them. If they say jump, you jump as high and as hard as you can, then ask if that was good enough because you can do better.

Business is a dog eat dog world. If you can’t be tough and be ready for whatever is thrown at you, it’s better if you take your sensibilities and stay out of the real world.

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The Investments That You Know About, but Choose to Ignore

Desty — Wed, 04 Jul 2007 19:03:28 +0000

Remember back in early to mid June I mentioned we would go over how to use the money that you used to pay yourself first? You don’t? Refresh yourself with this earlier article on paying yourself first.

Remember now? Super.

We are now going to use this money for safe investments. When I say safe investments, I don’t mean mutual funds or index funds. We are going to use your own knowledge and experience to see where your investment dollars go.

You: Investment Guru

Get out a pad of paper and write down all of your hobbies and the jobs you ever had. This is your sphere of influence. We’re going to stick to these areas when it comes to investing. Work for Microsoft? Ok, how is the company doing? You probably don’t know how well the company as a whole is doing, so you need to go to the company website and find the corporate link. You’ll see various investor and shareholder links and information. What you’re looking for is the annual reports. Try to go back atleast 5 years in your research. For right now, unless you know how to read income statements, balance sheets, and cashflow reports, stick to the written reports. Now, based off what you know from working there and what the annual report says about current operations and future endevors, what do you think of the company’s outlook? Do you think things are doing well? Do you feel, based off your own experience and the annual report, that this company can make money, and therefore, make you money as an investor?

Wait For the Fire Sale

Ok, you’ve determined that you want to invest in a company. You know what the company does, you feel that things are going well and they will continue to do well in the future. Don’t buy just yet!!! Its time to go shopping. When you go to buy a computer, you look for the best deal, correct? That’s what we’re going to do. We’re going to wait for the investment to go on sale. That means waiting for bad news. When that bad news comes, and it will, you have to look at the news with a critical eye and determine if this is a shift in what you think about the company. Has anything about the basic structure of the business altered that makes you think the company will not make profits in the future? An example of this is Apple.

Remember back in the summer of 2006 when Apple was in trouble over stock options? Well the price per share fell down to $50.67. Now, as an investor, stock options do affect the value of a stock and gives questions about management, but is the core business affected by this? The iPod is still going strong and rumor has it that Apple might launch a new product, maybe even a phone based off the iPod. Jump to summer 2007. Price per share is $127! If you had bought on the bad news last year, your investment would have doubled!

I’ll Close With a Personal Example

Back when I was working for a major food producer as a trucking dispatcher in their private fleet, I invested in the company’s 401k. This was pre-Enron, so I invested in company stock. While researching, I noticed a pattern in the stock. The core product sales was responsible for over 90% of revenue, so if it sold well, the price per share was good; vice versa when sales weren’t so good, the share price tanked. Well the product enjoyed a seasonal cycle. In the summer months, with the grills fired up, everyone had to buy the product, so from May till September the price per share would be very nice. In the winter months, no one was grilling, so demand for the product would lower dramaticly and so would the price per share.

So what I did was buy as many shares I could during the winter months with prices low. As the price per share would start to rise with the warmer weather, I would keep the shares, but all my new investment funds going into the 401k would go into the money market account; the price to buy new shares had gotten too high for me to make it worthwhile. Finally around August or so, with the temperatures at their peak, along with the stock price, I would sell all my shares of stock and put the money in the money market account. The money would then sleep until winter, with the price per share in the tank, when I would put all my money back into the stock.

I no longer work for the company and unfortunatly the company has diversified somewhat, so it’s no longer possible to ride the ups and downs of its share price.

I’m investing in a company now, an oil tanker company. I’ve never worked in the oil tanker business, but, at its heart, it’s just a transportation business that uses boats instead of trucks. So, stick with what you know, and buy on the cheap!

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What Would You Do With $5000 per Month?

Desty — Mon, 02 Jul 2007 00:42:38 +0000

Maybe it’s just me, but everywhere I go, I ask myself the same question:

“How the heck do they make money with that?”

I go to McDonalds, see how many people work there, figure about how much per hour they’re making, see how long McDonalds is open, and wonder how many happy meals, or Big Macs they have to sell to make a profit on a daily basis.

Every business has a fixed cost, be in inventory, property costs, taxes, payroll, or salary for the owner. Bloggers have fixed costs. Web hosting and domain registration isn’t free, unless you use Blogger or Wordpress.com, but you’ll find that most serious bloggers have their own domain and servers. When bloggers are actually able to make money thru their blog, I wonder what they do with that money. I’m relatively new to the blogging scene, so I can’t think of any other fixed costs to blogging. So after paying their hosting and domain fees, is the rest of the income free cashflow?

It seems that alot of the people who read the ‘how to make money online’ blogs want to be able to quit their job and have blogging be their primary source of income. While that would be nice, there’s no way I could handle doing that. My JOB is that of a trucking dispatcher; I send semi tractor-trailers to shippers to pickup and deliver to customers. It’s a detail-oriented career and I love it to death. I’m the type of person who MUST keep his mind occupied, otherwise I’d go crazy! It’s just like if you won the lottery, would you quit your job?

What would you do with $5000 per month from blogging? Would you quit your job?

Here’s exactly what I would do:

Speed up current debt repayments while investing $500 per month into my current stock profile
Enlarge current emergency fund from 3 months to 1 year’s worth of JOB income
Inject more funding into current businesses to expand
Save up and make down-payment on larger house
Pay off new home
Invest the income

Every point, except for buying a larger house (wife would insist), is working towards not only securing future income, but also expanding future income. That’s why, currently, even though I could take a small salary out of my current businesses, I don’t; all business income is directly reinvested back into the business, along the lines of cash management established in my business plans.

I actually have a written cash management plan I wrote long ago, but I can’t find my old business journal (too busy actually running the business to write a journal about it anymore), so I’ll wing it.

We check to see if 90% of the monthly income will cover the fixed costs and any variable costs that have popped up. If it does, take 10% of the monthly income and put it into the investment capital pool, the rest goes to paying off monthly costs. Any leftover income gets measured against the predetermined business plan goals in expanding the business. If the leftover income will allow the next goal to start, it does so, if not then the leftover income goes into either the company’s money market account or into CD’s; where the money goes is a judgment call depending on how long I think it will take to pay the investment to start the next step on the business plan.

It would be SO easy to pocket that leftover income, but then my businesses would never get where I want them to be. Businesses are always a work in progress; they’re never exactly where you want them to be. While the end result of those businesses may be pie-in-the-sky goals, you take them one step at a time in a preplanned and measured set of mini goals. When the business is where you want it to be, then you can enjoy the fruits of your labors.

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Online Marketing is a Must For Any Business

Desty — Thu, 28 Jun 2007 16:21:39 +0000

Any business owner that has a lick of sense will tell you that marketing is a tricky business. Whole departments are dedicated to it. You can study it in college for four (or more) years to get a degree. You can take the following statement to the bank:

Your business lives or dies by its marketing strategy.

That statement is true for all businesses, offline or online. Online businesses have a greater task in their marketing. Like it or not, online marketing is still in its infancy. While the World Wide Web appears to be everywhere and on the cutting edge, there are two limitations that people just don’t realize when thinking about marketing.

The majority of the world’s population is still offline. According to comScore Networks 771 million people over the age of 15 used the Internet in May 2007. Based off of a world population of 6.6 billion people, that’s only over 11.6% of the world online. From January 2006 to January 2007 these numbers increased by 10%. World population growth and the percentage of that population that goes online both show continued signs of growth.
Technology and context change instantly online. Facebook and mySpace did not exist 5 years ago; now you couldn’t imagine that they didn’t exist. Yahoo! used to be the 800-pound gorilla when it came to search engines; Google reigns supreme now, with Yahoo! trailing in 3rd behind MSN. Trends, what’s hot, and what’s popular change in the blink of an eye. What’s the rage today, for sure, won’t be tomorrow.

To get your business noticed online, your marketing must be ahead of the curve, not playing catch up. In order to do that, you need to be dedicated to your online marketing. When I say dedicated, I mean, focused on what the search engines are saying about you, and how they’re saying it. This is where SEO comes into play. Read 100 different sites about SEO and you’ll get 100 different opinions about SEO. Which of those 100 opinions are correct? Who knows?

Your best bet is to get professional help with your SEO and your online marketing. I don’t mean buying some book. You need to outsource your online marketing needs to people whose only job is to stay current on online marketing trends and keep your business current as well. An example of one such company is Discount Click.

Discount Click offers a comprehensive online marketing service. They offer search engine optimization services, link popularity campaigns, SEO self-service tools, ad management services, and email list management and processing. Discount Click allows you to focus your attention on building your business while they take care of making sure your online presence is effective and taking full advantage of all the perks that being online allows.

Whatever method or strategy you use for your online marketing, it must be serious. If you don’t take the online marketing of your business serious, then, really, what’s the point of being online?

This is a sponsored review

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Passion Makes the Business Grow Strong

Desty — Mon, 25 Jun 2007 17:05:42 +0000

I hear this question more times than others, “I would invest, but I don’t have the money.”

My response is simple, “Start a business and have it invest for you.”

Your Own Business
I’m not saying quit your job, buy into a MLM, or any such thing. Your own business can begin so easily as your hobby. What do you like to do in your spare time? What are you passionate about? The reason for starting a business can be something simple like wanting to make some extra money, but what you do in your business had better be something you like to do. Starting and running a business is tough! If you don’t like what you’re doing, it will be too easy to quit. That’s why I suggest starting with your hobbies; you’re already doing them in your spare time, it’s nothing to just add to it and make it a business.

Example:

Dave S. loves to exercise and lift weights. He has entered and won several weight-lifting competitions locally and has even gone overseas to enter international competitions, such as the Good-Will Games. He took some classes, got with an attorney to see what he needed to worry about from a liability stand point, bought some insurance against injury, and set-up his own personal trainer business. He’s doing what he loves in his spare time and kept his day job. He has plans to invest his income from his training into a website where he can have clients from all over the world and advise them over the Internet, and a long term goal of starting his own gym.

What I Did
As a personal example, I got my 1st iPod off of eBay and LOVED it! So does my wife, so we’re constantly fighting over who’s using it and what’s loaded on it. Realizing that I would be on the losing end of this (love ya hon), I went back to eBay and started shopping for another iPod. There were so many for sale, and I’m not kidding, they were all being sold! My eBay sales business began, with my niche being iPods. I would buy them as I could find them (locally on sale, thru an Internet retailer, Apple selling refurbished iPods, etc) and would mark them up as sell for profit. I was making a decent amount of money for what little time I put into it, but I gave it up. There were other things I wanted to spend my time on rather than bargain hunting iPods.

Once your newly formed part-time small business starts making a profit, then you will have the same problem that all CEO’s have: use the money to spend (dividends to shareholders), pay off debt, or use the money to expand the business to make even more profit. Its called capital allocation and it will determine not only how you see your business, but its future as well. At this point, the business is like any other investment, spend the income (not wise) or reinvest to help the income grow.

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The Perils of Owning a Growing Business

Desty — Thu, 21 Jun 2007 13:04:48 +0000

This is the second day in a row where, while writing today’s post, the general idea for my article was also used on another blog. This time, Problogger.net posted 7 Reflections on Scaling a Blog to a Sustainable Business. Darren talks about a fellow blogger, Wendy at eMoms At Home, writing about her blog growing faster and bigger than she can keep up with, and Darren gives her some suggestions on how to deal with it.

I can relate. Just last night as I was finishing up the dishes my wife oh so gently asked when our next event was. In our offline business, we search out and attend various county fairs, arts and craft fairs, etc. The summer is our go time of the year where the bulk of our business income is generated. I had to admit that I hadn’t taken the time to keep ahead of the pack in booking new events because I had been so wrapped up in getting this blog up and running. She then asked how our books were doing. You see, while she actually runs the operations of the business, I keep the books and set things up. I dusted off the books and discovered that I hadn’t recorded anything since about mid May, which times right along side when I started blogging. She didn’t have to say another word at that point.

As a person and as a businessman, I have two traits, for good or bad, that help me do what I do. First, I can multi-task pretty well, in that I can be working on task number one, stop in mid-stream, switch to task number two, go back to task one, start task three, back to task two, etc. Its funny, but I can compartmentalize fairly well. Also, when I am focusing on a task, I can focus my efforts to a laser sharp point, so much so that almost everything else fades to nothing. Its great to not have to worry about distractions, problem is that I can get so focused that I forget to go back to task one or task two. You guessed it, I had been so focused on the blog, learning about blogging, and creating networks that i had forgotten to go back to my offline businesses!

I’ve determined that I’m going to have to put a clamp down on my blogging activities. For the readers out there, you won’t notice a thing. I, on the other hand, will be limiting my research, my interactions, and postings to a set amount of time everyday, instead of watching the RSS feeds to new posts, checking stats, etc all day long.

There’s a lesson in all of this. Some people can run several businesses as long as they have great systems built around those businesses. Some people can run several businesses without business systems. Those who use systems to help manage their businesses find those businesses growing faster and larger than those without systems. Also, the use of those systems allow the growth to continue without the owner / manager being overwhelmed; when a business grows faster than the current system can withstand, simply expand the system either thru the hiring of more employees, outside contract help, or create a partnership with an existing business and farm the extra work out on a sub-contactor basis.

Develop your business system before you need it. Your system should be in place, if no where else than on paper, before its needed.

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Plan Your Trip Now For Your Business!

Desty — Thu, 14 Jun 2007 15:32:00 +0000

When you go on a trip anywhere, there are three very basic things you MUST know:

1. Where are you going?
2. Why are you going there?
3. How are you going to get there?

Your business requires you to answer the same questions. As hard as it may sound, they are very difficult questions to answer. On top of that, they must be answered in the correct order.

Where are you going?

Most people want to jump to the second question (Why are you going there?) first without understanding that unless you know where you are going you don’t know why you are going there. What is your product or service? What do you plan for your business to do? Will the products / services be the same in the business’s final form be the same as it is in the beginning?

Take some time away from everyone else and just think about what you want your business to become. Do you have a grand design for the business? Now is the time to create one. Take time to write down exactly what you want out of your business; don’t worry, you can (and will) always go back and adjust things.

To use as an example, I’ll tell you about my current business. Our end-game business is a holding company that owns and invests in several different companies. The three planned kingpins of this holding company are a privately owned insurance company, a solar power utility company, and a real estate investment / holding company.

Why are you going there?

At the beginning, everyone thinks that this is an easy question. What’s everyone’s answer to why are you going there? To be rich! BZZZZ Sorry! It isn’t going to be that easy!

Why are you going there is the second question and can only be answered after the first question (where are you going?) is answered. This question helps to flesh out your business in terms of strategy. Why is your business going to be what you planned? Why choose those products / services? A great deal of research will need to go into this. If after you answer this question, you don’t like the answers, you will need to go back to the first question and think about where you want to go. If you’re going to Mammoth Cave to visit and explore the cave, but you’re afraid of closed places, I suggest you rethink about going to Mammoth Cave.

To continue our example using my business, the reason for a holding company is that it allows us to expand into other businesses as desired / required. It allows us to set-up a synergy between businesses that will accelerate the underlying businesses. The real estate business exists to create affordable housing to the middle and lower class. The insurance company, as well as offering various different insurance products, will also insure the real estate holdings. Finally, to create value in both terms of real estate and value to the tenants (savings on utility bills), the solar energy utility will be networked into all real estate holdings, along with reselling generated power to the traditional electric companies.

How are you going to get there?

This is the tricky question. It’s the hardest, most expensive, and most important question to answer. To answer this question requires you to make a judgment call. You have this grand plan for your business. You know why you want to do it. Now how are you going to do it? Do you personally have the knowledge and experience to pull it off or (most likely this is the case) will you have to bring others in with that knowledge and experience? How will you treat them? Will they become partners, employees, or independent contractors for your business? Don’t even get me started on investors and venture capital!

We talked about strategy earlier when planning the business, now we’re talking about tactics involved. What actions must you take to bring your business to where you want it? When you’re taking a road trip, it’s easy to figure out where and why. The how comes from when you pull out the atlas and start looking at what roads to use. Do you use the interstate? Do you use state highways? Do you use country back roads? It all comes back to where you are going.

I’ll hope you’ll forgive me if I don’t share the example of my business on the how to get there. I’m still working on it!

Answer these three questions and guess what you have, a very basic business plan! Sure, there are tons of actual details left before you have a workable business plan, but at least now you have something to work with. This is the foundation of your business. If you can’t answer these questions in detail, then your business is doomed to failure!

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Are You Blogging to Make Money or Are You Blogging to Become Rich? Part 1

Desty — Thu, 07 Jun 2007 15:09:00 +0000

You’ve made it! You’re finally making a “decent” amount of income from your blogging. Its been years in the making but the long hours of creating valuable content, building a loyal readership base, made it onto the 1st page of Google search results, and the traffic is pouring in. You can finally live your dream and become a professional blogger. If you’re at this place, please for God’s sake read and take these words top heart: DO NOT QUIT YOUR DAY JOB!

But you say that you hate your day job. You dream at night about being able to tell your boss to shove it. You dream about staying home and blogging, watching the money just pour in. Don’t give in to that temptation! All you’re doing is trading one J.O.B. for another J.O.B. and, more importantly, you’ll be giving up on your #1 dream. What dream is that, you ask?

The dream to be rich.

But how are you giving up on your dream to be rich? Isn’t being able to quit your job and blog full time show that you’re well on your way to be rich? I’m sorry to say, no, that’s incorrect. You’re making enough money from blogging to REPLACE your job’s income. That shouldn’t be your goal. Please believe me when I say this:

You can make money blogging, but blogging alone won’t make you rich.

Blogging can help you become rich, but I won’t lie to you, its tough. However, if you’ve had the tenacity to build a successful blog, you can do it.

Start off by looking at what you are spending your income from the blog on. I’m sure you’re covering your overhead to just have the blog, but what are you doing with the rest of your monty? If it doesn’t involve your blog in somewhat and improving its revenue, that money is better off in a money market account for the time being; don’t worry, we’ll come back to it soon.

I suggest that you sit down and think about your blog as a whole. Is there anyway you can increase your income from the blog? What would that take? Brainstorm a list of improvements to your blog that would, directly or indirectly, increase its revenue. You’ve made contacts with other bloggers over the years, use them. Work it every way from sideways to come up with ideas. Write them all down, no matter how silly or pie-in-the-sky they might be. Now, one by one, go through each idea and research it. Flesh it out until you have a solid idea about how much work, time, and / or money it would take to do. Is it a one-time cost, or something you’ll have to pay for on a regular basis? Narrow it down to how much net income will it generate. Now go to the next idea, rinse, repeat until you have all your ideas worked out. Now its time to come to reality. How would these ideas impact your current operations? Increased ads might increase revenue, but also might alienate current readers, and therefore decrease income. Make sure you take all things into consideration.

Alright, you’ve brought your blog to a new level of cash generating potential. Now the fun really begins…

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