This is a digest and recap of highlights, quotes, and comments from articles and discussions posted on this date on the Applied Entrepreneurship, LinkedIn group site.
*Testimonials Let Customers Praise Your Good Graces … by Debra Jason
Whether you’re a well-known company that’s been around for years or a “new guy/gal on the block,” establishing credibility for your company is vital.
“Every potential customer wants to know the benefits of doing business with you (i.e. “what’s in it for me?”). Then, once their interest has been piqued and they’re seriously considering your product or service, they want to know that your company is a viable business, one they can count on.”
“Readers find the endorsements of fellow consumers more persuasive than the puffery of anonymous copywriters.”
Setting up a methodical testimonial-soliciting program, can increase the effective use of testimonial. Here are some suggestions:
- Get permission from the person you’re quoting before you use their comments in any way, shape or form.
- Don’t use testimonials without names, if you can at all help it. They lack credibility. You can use a person’s:
- a) Full name along with a city and state and/or company name.
- b) First initial and full last name with city, state and/or company name.
- c) First and last initials with city, state and/or a company name.
- d) A person’s title, again with a city, state and/or company name.
- Use specific testimonials.
- If you can afford to have a well-known celebrity back your product/ service, be sure that it makes sense for him/her to endorse you.
- Ask people for their input. There’s nothing wrong with doing this. Put together a short letter asking your clients for their feedback.
“When you’re looking for ways to market yourself and wondering just what you’ll do next, turn to your customers. Give them the chance to praise your good graces. And don’t be afraid to ask them for “constructive criticism” as well — it will help you provide better service in the future.”
*How to Use Market Research in a Recession by John Quelch
Recession-challenged consumers are buying less, looking for deals, or switching to different brands, product categories, or stores. Some are even changing long-held attitudes toward consumption. To many folks, filling the home with more stuff or keeping up with the Joneses is no longer appealing.
The article recommends that CMOs take the following seven steps to minimize the impact of reduced spending:
- Stay focused
- Enlist trusted partners.
- Value experience and judgment.
- Seize opportunities overseas
- Go online with a dash of skepticism.
- Don’t cut across the board.
- Keep an eye on the new consumer.
*The Five Competitive Forces That Shape Strategy by Michael E. Porter
In essence, the job of the strategist is to understand and cope with competition. Often, however, managers define competition too narrowly, as if it occurred only among today’s direct competitors.
Competition for profits goes beyond established industry rivals to include four other competitive forces as well: customers, suppliers, potential entrants, and substitute products. The extended rivalry that results from all five forces defines an industry’s structure and shapes the nature of competitive interaction within an industry. As different from one another as industries might appear on the surface, the underlying drivers of profitability are the same.
The five forces that shape industry competition are:
- Rivalry among existing competitors
- Threat of new entrants
- Bargaining power of buyers
- Threat of substitute products or services
- Bargaining power of suppliers
The strongest competitive force or forces determine the profitability of an industry and become the most important to strategy formulation.
Understanding the competitive forces, and their underlying causes, reveals the roots of an industry’s current profitability while providing a framework for anticipating and influencing competition (and profitability) over time.
Understanding industry structure is also essential to effective strategic positioning.
*Is Your Company Brave Enough to Survive? by Freek Vermeulen
The market is Darwinian: the strongest ones survive. And an economic downturn is like winter in Alaska; many animals can live a happy life in Alaska all through spring, summer, and fall, but when winter comes, it’s not a great place to be. It’s a much tougher environment — and only the fittest survive.
There are a few survival techniques from looking at firms’ downturn survival strategies, although they are not for the faint-hearted.
What firms are better off doing, is opening up; exploring new sources of potential revenue and experimenting with bottom-up processes to generate such ideas and innovations.
Quite a lot of firms display “threat-rigidity effects.” When under threat, facing a shortfall in performance, firms are inclined to more narrowly and firmly focus on the one thing they do well (e.g. their core product or service), stop doing other things, and become more hierarchical and top-down in terms of management control.
This often makes things worse, or at least prevents you from coming up with any solutions. To combat this you can initiate some processes for all employees to start generating ideas for potential new sources of revenue. Most ideas may be rubbish; some ideas were so-so, but a few ideas may be really good! You may only need one of these ideas to realize a substantial new source of revenue.
*Need Growth Ideas? Ask Everyone by Julie Gilbert
“Now is the time to stop and take a fresh look at your assets, and engage the people — right in front of you — who have the most relevant point of view for reinventing and innovating a better future. It only takes one simple act of leadership: ask for their help, their perspectives, and their voices at the table. Invite them into the discussion.”
Having your voice heard is the ultimate sign of respect and can be a powerful call to engagement. To actually implement this strategy:
- As a leader, lay out a vision of where you want to be (not the how, just the what)
- Stay true to the essence of your organization
- Lay out on a white board all the assets you have in the organization especially those you may have taken for granted or utilized in a defensive way vs. offensive
- Map out your capabilities
- Identify trends in the communities where you do business and be realistic about the new populations, previously ignored, that exist in your business
- Ask for help from employees and customers using your insights from the previous steps and let them unleash the magic they have in them
The trick? You must have a genuine and authentic belief in the people…not just a select few, but all people.
“You will identify big ideas that reinvent the future, and you’ll come out of today’s environment stronger than ever — with employees and customers cheering at home and in the parking lots.”
* How a simple 3-steps home business plan keeps personal enemies away by Annemarie
Home business entrepreneurs face “apparitions” in both quiet moments and hectic paces, such as “what have I got myself into, what am I going to do next, what will others think.”
A home business, built on strong network marketing principles, can be well fortified by a simple basic business plan, built upon strong pillars:
- education first so you know the main facts
- self-empowerment to believe you can win
- exciting change that is welcome and anticipated
*Work from home steps #1-4
I posted the first four articles in a series of five (couldn’t locate the fifth) about the process of developing an opportunity to work from home. This series from the BabyCenter was obviously intended for mothers, but many of the points can apply to any entrepreneur who is considering leaving their day job to create a home-based employment situation. The self-inventory article, for instance, suggested answering these questions:
- What do you enjoy doing? You never know what you might find.
- What are your talents and skills? There’s a market for everything.
- What experience do you have? This can be professional or volunteer.
- What education and certifications do you have?
The five steps are:
- Brainstorm your goals
- Take a self-inventory
- Choose your path
- Plan for success
- Assess your progress
The series of articles has some nice links to other resources to help you through this process, such as a self-inventory test, a Career Interests Game, articles on goal setting, and a substantial list of links to companies offering work at home options.
What I Think
I think the articles posted on this date provide a nice variety of advice from reshaping your day job, so you can work from home, to surviving the battlefield of competition in the open market. Annemarie’s article on steps to dispel the “apparitions” of personal doubt is followed by more concrete steps and resources in the BabyCenter series on how to get from point A to point B in the process of getting yourself into the marketplace on your terms.
The article by Freek Vermeulen (love the name) points out that you might want to be careful what you ask for. His analogy that running a business in an economic downturn “is like winter in Alaska,” is a fair spin on Darwin’s theory of survival of the fittest. I have certainly witnessed many businesses exhibiting “threat-rigidity effects,” when faced with the challenges of today’s economic downturn. I have not witnessed that leading to success for any of them.
On the other hand, I have found success stories among those companies, which have used this economic crisis to become leaner and more efficient, and to seek out innovative ways to decrease costs, shorten turn around time for deals, and sought out new revenue streams based upon feedback from customers and employees. Difficult times require difficult and sometimes extreme measures for survival. A well-worn saying attributed to Albert Einstein puts a point on this: the definition of insanity is “doing the same thing over and over again and expecting different results.”
If a business is to survive in these difficult economic times, it would certainly seem appropriate for it to be diligent in using self-examination tools, market research and competitive intelligence techniques, and the many other diagnostic tools available even to the smallest businesses. Years ago, I placed a fortune cookie saying under the glass atop the desk in my office. The saying is “Some people spend their lives trying to climb the ladder of success, only to find it is leaning against the wrong tree.”
The common thread among the articles posted on this date seems to be to avoid the path of the dodo bird (i.e. extinction). There certainly are adequate tools available to set a reasonable path for a new business, to test customer reaction to new products and services, and to measure the sustainability of existing ones. Established businesses, likewise, have tools and techniques to gain valuable feedback from customers and employees, to find ways to do more with less, and to increase the number of revenues streams. A business owner or board of directors not in tune with these opportunities would seem far down the path of the dodo.
If you enjoyed my impression of these articles, why don’t you read them for yourself and see what you and I missed or hit? Join the Applied Entrepreneurship group on LinkedIn. Membership is free and I try to post about ten articles a day there. We have some great discussions going and if you are an entrepreneur, we hope you will join us.