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Archive for the ‘Business’ Category
The Cost of Free
Thursday, June 16th, 2011 by Butch WhitmireI emailed a respected marketer and he made a statement that was quite profound. He said, “Free stuff we’ll take all day long. But I also don’t want to work with somebody who gives away their products or services too cheap – if they can’t sell their own stuff, how can they help me sell mine?”
I loved his perspective in a time when open source code, free downloads, Groupons, free newsletters, “kids eat free,” are running rampant. People seem to crave “free” and statistically, they move in big numbers when the see the word “free” attached to a marketing campaign. However, I have big concerns with “free” (or the ridiculously reduced.)
As I wrote in an earlier post about scarcity, for things to be valuable people must perceive them as both a) useful and b) scarce. So, when we say something is “free” (meaning zero monetary value) people intuit that the service or good is either not very useful to them or it is abundantly available to all. Free lowers perceived value.
Another reason I am concerned about free is that people intrinsically intuit that “nothing is free.” So, clients assume there are strings or other cost attached. For example, our developers utilize an amazing open-source CMS/CMF called Drupal. This PHP-based code is available to us and everyone for no cash outlay. However, learning Drupal has been anything but free to Force 5. Our team has invested scores and scores of unbillable R&D hours to learn this protocol. “Free” usually has a cost attached – somewhere.
So, why are so many sales people and marketers using “free” (or ridiculously under-priced) to gain business? For me, there are only four plausible explanations:
1) You are lowering the barrier to entry. Free trials can lead to sales but they must be made scarce; meaning they are limited. Free one time to get to know your product or service. After that, it’s time to charge – drug dealers have known this for years.
2) You are relying on the social norm of reciprocity. (You scratch my back, I’ll scratch yours.) This is a risky approach. As I mentioned, people usually assume “nothing is for free” so they will take and take from you with little compulsion to give you anything in return.
3) You don’t believe your product or service is really very valuable. If this is the case, it’s time for a gut check. It’s time to evaluate and change your product or service to meet the demands of a crazily competitive market.
4) You’re a little lazy or at least not very creative. Free is easy. Free is fast. Free is simple. Free creates a lot of activity. Free doesn’t require you to make a compelling case for your product. Maybe it’s time to work on your marketing or selling skills, at least a little.
So the question must be asked: Are you overusing “free” and at what cost?
Hey Buddy, wanna deal?
Tuesday, June 14th, 2011 by David MorganHey, Want a deal? Ok, here it is….I’ll give you $2,500—1/3 now, 1/3 in 30 days, and the final 1/3 in 60. You give my customers $10,000 in retail business from your shop. How does that sound?
credit: Rocky Ayrawal
That’s a Groupon deal.
The “daily deal” industry structures their deals so that the retailer must be very careful about the deal they are getting.
Generally, a company like Groupon wants you to give a 50% deal ($10,000 worth of stuff for $5,000)—then they take 50% of the income from the sale of the coupons. Will you get customers in your door? Sure….But here are two questions you must consider.1-Will the people who take advantage of my coupon be existing customers?
2-If they are new, will they return?The problem is we don’t know the answer. If we have a lot of number 1, we lose money. We just gave away a 75% deal…to an existing customer!
If we have a lot of the second group, and they don’t return, we lose money too. Are people returning? Its too early to tell. We know that Groupon is making money, but will you?There are many more factors in the daily deal scenario that needs to be scrutenized by the savvy business person. So be careful. Usually, (and depending on your type of business) couponing isn’t a bad strategy—but how many 75% off deals can you afford?
To see the original article from Rocky Ayrawal, Tech Crunch
The Value of Small + Smart
Tuesday, June 7th, 2011 by Butch WhitmireWhenever I’m asked about Force 5, one of the things I say about our company is that we are“small and smart.” Most people understand immediately what half of that means. We have only a handful of people on our staff – so, we’re small – pretty easy. Small is good these days. That means we don’t carry a lot of overhead so we can be competitive. Being small also means that we can be pretty agile, too. There aren’t too many people or committees required to make decisions. We can quickly decide what to do and move – and that’s a good thing for our clients.
When I say “We’re smart,” I think I run the risk of sounding arrogant. Granted, there are some pretty sharp people I get to work with here (me - not so much.) The “smart” part is really about bringing in the right resources when we need them. This allows us to assemble the best possible talent for a specific need and remain laser-focused on the client. Being smart also keeps us fresh and creative.
From a personal standpoint, being “small and smart” forces me to be more rounded as a business person. It’s made me realize that client issues are most often multi-faceted and that one area of expertise is seldom the cure for a particular issue. This regularly pushes me outside the limits of my capacity and into the realms of more capable people in specialize areas. The results are: wins for the client, wins for Force 5, wins for freelancers, and wins for me. And who wouldn’t want that?
Google Panda
Tuesday, May 24th, 2011 by David Morgan
Google’s recent “Panda” update is getting plenty of notice and discussion on SEO and web marketing sites. This is an algorithm update, the formula Google uses to rank sites—using a variety of areas of your web site.It’s clear that one of the biggest goals for Google’s algorithm update is to provide higher page rankings for quality, rather than quantity, content. The biggest sites hurt in the change seem to be the “content farms”. A content farm (according to Wiki…) “employs large numbers of often freelance writers to generate textual content which is specifically designed to satisfy algorithms for maximal retrieval by automated search engines”. In other words, spammy content designed to fool Google into better results.
While your site may not be a content farm, you could be adversely affected by this update if your site contains:
* Relatively high amounts of advertising on the site
* Duplicate content (either on your own site or other domains)
* Page headlines that don’t match their contentYou can improve your site’s ranking with:
* Authoritative and useful content
* If your site is currently light on verbiage, more words per page may be an asset
* Content that provides value to your visitors
* Social network visibility via comments and sharingGoogle constantly looks at their search methods, and modify them to help you bring you the results you want. Good content—relative content—is always the proper way to build your site. Force 5 tries to stay abreast of the latest search methodologies – contact us if we can be of assistance as you update your site.
Order Up!
Monday, May 23rd, 2011 by Deb DeFreeuwForce 5 recently wrote about a project we did involving QR (quick response) codes. The campaign, done for Smoker Craft boats, has been a success and a practical application of this new and growing tool. Since the boom in QR codes, I have since seen them on everything from ads in magazines to the lettuce container at the grocery store. So, it has led me to think about their use and where they might be most effective. While reading an article in the technology section of the Wall Street Journal I came across an example worth sharing.
The article talked about a coffee shop in British Columbia named Ethical Bean. They were looking for a way to stand out in a very crowded market. Ethical Bean decided to put QR codes on ads that were placed inside trains. When a user scans the code, a coffee menu pops up and they can order their coffee and have it waiting when they arrive. Now that is a practical use of QR code technology. Ethical Bean doubled sales by providing an easy way for the on-the-go consumer to purchase their product.QR codes are popping up everywhere, if you are using them, make sure they take your consumer to content worth the trouble. If it’s your first tip-toe through the QR code field, we can help, call us.
Web of One
Tuesday, May 17th, 2011 by David MorganI was listening to a TED talk yesterday from Eli Pariser, who just wrote the book “The Filter Bubble”.In his talk, he tells of the personalization taking place on the web. Everything is filtered before it gets to us. I have an interest in sailing, and listed that on my facebook. And lo and behold, I see ads and articles on Sailing. Google Ad words looks at blogs, and then show ads linked to key words found in the article.
The Filter bubble by Eli Pariser
In fact, Google uses 57 different criteria to filter content to you. This might include your location, you age, gender, and whatever else they know about you.
Is personalization a good thing? In most cases, sure. I don’t mind seeing ads on sailing, but what am I missing? Eli’s premise is that you start to see only your filter—a filter that’s not necessarily controlled by you. So if I’m conservative, I may not see liberal points of view. If I like dogs, I might not see cats…Get the picture?
Some argue that most people lack the time, motivation and self-knowledge to customize their filter, if they are given the chance. But others think that automatic personalization severely limits the power of the net to stretch our minds.
Do you want to see opposing views on a subject? Do you want to see challenging and contrary viewpoints? Is your filter relevant, important, uncomfortable, challenging, other points of view? Again, as we’ve noted in previous blogs, its all about data mining.
As a brand development and marketing communications firm, Force 5 is always interested in metrics. We want to know if our target audience for any given product or service is seeing (and responding to) our message. But has data mining and filtering gone too far—limiting our selections, making a “web of one”—instead of a “web of many”? What do you think?
Touchy Feely
Monday, May 16th, 2011 by Butch Whitmire
It’s been almost a year since the release of Apple’s iPhone 4. I traded in my old iPhone 3G just a few months ago. I love the 4’s speed, video features, functionality. Ultimately, I’m glad I made the switch. But I have to be honest with you; there’s something that’s just not been quite right with my new iPhone 4. And I until this morning, I hadn’t been able to put my finger on the reason why. This morning, as I was reading a book by Tim Mathers, I realized that my fingers are the reason why. In Relevance: Making Stuff That Matters, Mathers devotes a chapter to Design as a function of brand experience. Specifically, he writes about “Tactile Tactics” noting that the iconic Coca-Cola bottle was one of the first packages so unique that it could be identified by feel alone. Additionally, Mathers cites the reinvented pillbox developed for GlaxoSmithKlines’s drug Alli. The shape and texture of this pillbox was ” … almost like you’re grabbing the hand of a friend, almost a clasp … a friend and ally.” He goes on to say that tactile branding works because as humans, we are hardwared to judge people and things by the way they feel in our hands.
For me, the shape and feel is the only disappointment of the iPhone 4. My old phone had beveled edges which fit comfortably in my hand. Those edges allowed my phone to slip easily in and out of my pants pocket and they allowed me to tell if my phone was screen up or down in my pocket. The iPhone 4 gained more usable space when it eliminated the bevels, it is thinner, and stronger, too. But now, it is a rectangle that feels out of place in the palm of my hand. So, for me the in the tactile sense arena, the Apple brand has taken a little step back.
I think the lesson here for me is the simple reminder that brand development encompasses everything within realm of human experiece: sight, smell, sound, taste, and touch. An encounter with you and your business or product is an interaction with all of those human senses and we need to be mindful of each one. Which of the human senses does your product effect most and how are you ensuring that it is the best experience possible?
Raising Entrepreneurs
Thursday, May 12th, 2011 by Nevin McElwrathFirst some background: I am a father to an amazing 2 year old son named Neilan who is in the midst of innocently testing as many boundaries as possible with his mother and I, but still has me belly laughing daily at his antics. He’s a true showman. While I believe raising your children to be entrepreneurs is a great thing to encourage – I do not think it is a good thing for everyone enforce. Why? It depends on your child’s personality traits. There’s no boilerplate on how to raise your child – that’s kind of the fun part. It’s up to you to see the traits and react.
The above video had a huge impact on how I approach supporting my son as he gets older. What opened my eyes the most? The things to look for when searching for those “entrepreneurial traits” that may be hard to see in your child. Neilan certainly is capable of having and/or developing these traits, it may be too soon to tell at 2 years old. There’s no doubt it’s in the blood lines. Both his mother’s family and mine have a plethora of entrepreneurial traits and characteristics both in personality characteristics and family history. However, that doesn’t mean his path is already paved. It’s up to us as parents to watch for the traits before we start encouraging. With a parent’s point of view, here are some of my takeaways from the video:
- Use encouragement instead of limitations to form your child’s interests and capabilities. Don’t build walls, supply them with the tools.
- Once the entrepreneurial traits are seen, encourage these skills: problem solving, to ask questions, to be creative, to lead others, to learn from mistakes, how to save money, to want to make money, how to sell, to ask for help, public speaking, to never give up, to see solutions.
- Teach your child to fish, rather than giving them a fish.
What was your most resonating takeaway from the TED video?
Why Facebook launched the Send button
Wednesday, April 27th, 2011 by Nevin McElwrathFacebook on Monday launched a new way to share content online – the Send button. While the functionality is nothing new, how you share content with friends may change with this new process of sharing. Facebook’s goal is to be that “pipe” in which you share more and more information, ultimately learning much more about you so it can deliver specific and targeted advertising down the road.
Let’s look at Facebook’s point of view for a minute. Why do you share links now? You know someone who would find a use for that content, right? Here’s an example scenario: You thought your friend would like this new recipe on a cooking site because she is into gluten free cooking. You send the web address to your friend(s) through the Send button, Facebook takes note of who you send it to, what the link is, the content of the page you sent, and your message. Before your friend knows it, they are seeing ads for gluten free cooking in the right hand column of your Facebook profile. This is exactly what advertisers are after – user relevance. Would you pay more to know that your product or service is being seen by your exact target audience? Absolutely. Targeted ads sell at a premium and Facebook is upping the relevance factor on it’s users.The difference here is that your friends are helping create your interest profiles for advertisers. In some instances, in bulk thanks to Facebook’s group features.
What are your views on targeted ads? Creepy? Useful? Reminds you of the annoying eCards from a few years back? Let us know in the comments below – or better yet, “Send” this story to a friend.
