Building a Pyrotechnic Business - 7 x 7 ‘Sure Fire’ Accelerants for Entrepreneurs

Accelerant 6: Paraffin Marketing

1. Embrace Social Media

This is probably a marmite test (you either like it or you hate it). You can either ignore Social Media and let it pass you by or get engaged. What’s so attractive about social media is that it offers a low cost way of promoting your personal brand, your business and its reach. Bear in mind, though, it might be low cost financially but there can be a significant time cost until you work out the best mix for your business. The favourite have fairly distinctive roles but they are becoming increasingly blurred. Linked In tends to be a professional network, Facebook more friends and family. Twitter is more about immediacy and spontaneity – the limit of 140 characters certainly focuses the mind. 

If you haven’t done so get on an introductory workshop – there are plenty about. At some stage unless it’s something you enjoy you’ll have to talk to and pay for a ‘geek’.

2. Know your cost of acquisition

There’s a famous quote – attributed to many of the marketing gurus – that 50% of your marketing budget is wasted – but you don’t know which 50%. This was in an age when advertising was mainly in television, newspapers and magazines – this was called ‘broadcast’ - as in paint thrown at the wall. Later direct mail came along and it was then possible to measure response rates more precisely. 

These days both the targeting of customers and the response analytics are much more focused. It’s surprising, however, that not many businesses sufficiently understand the actual business they get back per £ of marketing spend. This spend is not just the direct costs but also the time costs if you’re providing a service, say, travel or estate agents.

What you spend to get business has to be related to what you get. Make sure you understand what this relationship is – collect the data so your decisions are evidence based.

3. Go wide

In the early stages it pays not to be too narrow minded about how you promote your business. Cost is inevitably the major inhibitor here. But see if you can find some cheeky low cost ways – which should be ethical of course - to get your message out. Plug and play to see what works and what doesn’t work. Remember just because it didn’t work once doesn’t mean it won’t work for ever - in many cases timing is everything.

4. Blitz local

Quite often when you start out there’s an urge to chase business all over the place because, perhaps, of some sort of assumption that locally there’s no understanding or need. Or, it may be just to do with being busy which, when you start your own business, can be a bit of an aphrodisiac. 

It might come, too, from a personal sense of reticence or self-consciousness. Go large as well as wide. If you can’t sell it locally then it’s unlikely you can sell it nationally. Stay close to home - it’s cheaper and easier to service and you can go and find out face to face why you’re not getting the sales.

Join local networking groups – many offer free trial membership so you can see if it works for you – to promote your business and build potential local collaborative partnerships.

5. Copy – but do it Better

There’s a sufficient body of evidence that suggests that those who are first with an innovative business idea don’t profit the most from it. There are a number of reasons for this (such as a focus on technological features rather than buyer needs) but pragmatically a potential benefit for you is that they may have ‘softened up’ the market.  

So, if you’re idea is already out there, don’t worry, look and learn and motor on from their experience! This applies not just to product innovation but also to the whole suite of marketing and sales activity. Where is the best practice? 

Find out and copy? Yes, but do it in a thoughtful and forensic way that adds demonstrable value to your own business.

6. Drive referrals

Often business owners will say referrals are where there new business opportunities mostly come from. This is the ‘virtuous’ circle, but typically though, these are ‘passive’ referrals, relying on good nature and goodwill. You can’t afford to wait for something that may or may not happen – this is the ‘vicious’ circle.

There may well be some cultural dynamics at work here – because we don’t like asking for feedback or like seeming to be ‘pushy’. But, get over it, if you’re running your own business it’s perfectly legitimate to ask satisfied customers to make specific referrals for you.

Ask them:

·         Who should I speak to?

·         Will you introduce me?

·         What do I need to know about them?

·         Will you come with me to the meeting?

You might want to put some reward mechanisms in place but don’t don’t do this unless it’s asked for and then be very careful about the longer term implications of what you agree.

7. Who is Buying Right Now?

When you start out, you’ll have developed a thoughtful considered view about who will buy your product – and that’s good practice - target marketing as they say. The reality, of course, is understanding who is actually buying your product now it’s on the market. 

And, more importantly, what their motives are. Where is the money coming from?

And you may be surprised – but be not judgemental! If the buyers aren’t who you thought they’d be are you going to give them their money back? 

No, of course not. So the message here is be curious. Set up tracking systems – for example online/offline satisfaction surveys - that give you permission to talk to these customers and find out why they bought. And then build this into your on-going marketing and sales activity.

chrisfarrance@btclick.com

@chrisfarrance

www,chrisfarrance.co.uk

Building a Pyrotechnic Business - 7 x 7 ‘Sure Fire’ Accelerants for Entrepreneurs Accelerant 5.- Dousing the Home Fires

Prelude I’m writing this blog listening to ‘Sounds of the 80’s’. As far as I am aware there is no correlation between the music and the blog content. But it could be sublimal!

1. It’s My Business!
   
   

Survivor - ‘Don’t lose your grip’

Pride of ownership is understandable. The strength, focus, direction and probably the money that you provide are essential. That’s what makes you want to run your own business - an entrepreneur if you like. But it can’t be a totalitarian state because life’s not like that anymore.  So, loosen up! Listen to the people around you – particularly those you’re not likely to agree with. Listen to learn not to argue. Be open!

2. I have to Know Everything
   
   

Africa: Toto

Oh no you don’t – more loosening up! Because this mindset is a recipe for disaster.  If you’ve come out of corporate life you will be imbued with a number of assumptions. Knowledge is power, seniority is what counts. But there’s no way you can know everything you need to know about your business. Learn humility and again a willingness to listen. Build a network around you of knowledgeable, challenging and supportive people. Look for opposites to challenge the way you think.

3. Urgent v Important

Love Resurrection: Alison Moyet

You’ll never run out of things to do. Running your own business will most likely consume all your energy and all your time. Let’s deal with the time issue here. There’s a functional element true - like getting to meetings on time and handling a piece of paper just once.

There’s a decision making element – a big ‘P’ word to avoid here – ‘Procrastination’ – not all decision making issues improve with time. 

But the killer challenge is identifying those critical few things that make a real difference to your business. They’re going to be things like staying close to your best customers, managing your cashflow and making sure your staff aren’t the terrorists in your business. Do you know what your critical few are?

4. Focus on next week

Dancing in the Dark: Bruce Springsteen

Most people are not energised by the past – the future in all its uncertainty is much more stimulating and potentially exciting. So, don’t spend too much time looking in the rear view mirror - often this just causes post mortems - something to be learnt maybe but too often just a big bagload of recriminations. Be upbeat:

·         What have we learnt about what our customers want?

·         What’s getting in the way?

·         Most importantly. What should I be doing differently? 

This is a killer question! Don’t be afraid to ask it of yourself and others.

Make sure you step up and be prepared to acknowledge that you may be part of the problem. Yes – it’s a great team building offer and you could learn a lot about yourself.

5. Dealing with your competitor’s  ‘Killer’ offers
   
   

99 Red Balloons: Nena

It won’t be unusual – given all the things you have to deal with – if your customers and your staff in particular know who’s doing the best deal at the moment. For your staff this will be potentially demoralising if you don’t deal with it.

The knee jerk reaction, once you’ve found out, is to want to match the offer.

Don’t – take some time to consider the ‘whys’ and ‘wherefores’.  Competing on price is a zero sum game. Stick to the principles of your pricing strategy. Sorry, there’s a huge assumption here - that your pricing strategy is well founded. 

But essentially this is the trade-off between volume and margin – high volume v low margin and lower volume v higher margin. The issue is what profit do you make at the end of the day?

Make sure your people know the story too.

6. The ‘To Do’ list

Down Under: Men At Work

Writing lists is good practice – it really does free up space in your head and helps you to stop talking to yourself. So you have a list - check it against the ‘Urgent v Important’. Check it against ‘Now/not now’. What’s on there that only you can do – think about what you can delegate.  So, if you’re not selling something people will buy you don’t have a business. If your supply chain isn’t working properly then you don’t have product. Think about what you can safely ignore. Test and trial. Sharpen your decision making skills!

7. The Money Thing

Ghostbusters: Ray Parker Junior ‘I ain’t afraid of no ghosts’

.

If only we could do without it!  Of course we’re all afraid of the ’ghost’ of money. Not many people will say they have enough but a lot will recognise that money doesn’t buy them happiness. Moving from the relative certainty of being salaried to the total ambiguity of self-employment is very very frightening. But a good friend told me that if you get uptight about money or more particularly the lack of it – then it will radiate through in sales interactions.

So, put the money ‘ghost in its place – in a dark dark cupboard and leave it there!

Building a Pyrotechnic Business - 7 x 7 ‘Sure Fire’ Accelerants for Entrepreneurs

Accelerant 4. Lighting the Customer's Fire

1. Easy buying
You'll have your own personal experiences of companies who you really thought didn't want to do business with you because it was so so difficult to get anything done. This might include out of stock products, poor in-store signage, indifferent staff, incommunicado call centres, failure to call back and so on. Life's too short for all this hassle! Buying your product or service should be effortless and painless for your customers - test drive it for yourself. Remember there's a strong emotional element to this too. Where you can, walk your customers through the process to give them confidence - let them 'plug and play' for themselves.

2. A transparent offer
How often when you're buying something - particularly a service - do you find that you're not really sure what you're getting? If it says what it does on the tin then that's a bonus but too often the offer is opaque, the policy document too long, and the conditions unreal. Jargon! Jargon! Jargon! Make it clear if something else is needed - like batteries or a supporting software package. Think about what you would want as a customer, resist the temptation to be a lawyer, let your values shine through.

3. The Wow! Factor
Where you can, generate some excitement for the customer. Better still exceed their expectations. It doesn't have to be expensive. Remembering customer's names, how they like their coffee, picking up on family news they shared with you when they were last in, all create a positive impact. Research says we all want more attention so give your customer your full attention - don't look over their shoulder or precipitately start a conversation with someone else. Another neat move is to offer the customer more choice than they thought they had and act as an impartial expert. Recommend competitors if you don't feel you really have what the customer wants. Finally, make sure you send them away with a smile!

4. Value
Understand what the actual value is that you're providing to your customer. This may not be what you think - avoid falling in to the trap of confusing features with benefits. Get your customers to tell you in their own words exactly why they bought the product - what satisfaction they are getting from it. These may not be the same as you imagined when you put your proposition together. This helps in a number of ways - in your advertising, yes, but more importantly for your pricing. If you understand the customer's perception of value then you can break free from arithmetic pricing like cost plus pricing or percentage mark ups.

5. Keeping promises
Research suggests that people's perceptions of brands are rarely matched by the reality of experiencing them - there's usually an initial fall in satisfaction. So, it's doubly important that when the customer engages with you, you do all you can to deliver on your promises - whatever they might be. There's the issue too of buyer's remorse - the anxiety associated with buying a product. Is it too expensive? How can I justify it? How am I really going to pay for it? Your promise here is that what you are selling will really deliver the stated benefits. Do you ring back when you say you'll ring back?

6. Guarantees
Think very carefully about what sort of guarantees you might be able to offer - these will help minimise the perception of risk in the eyes of the customer. They will also demonstrate your confidence in your product too. Guarantees can span all of the steps in your buying process - time to answer the phone or be served, delivery time, returns polices and after sales. Give generously if there is any doubt - use it as market research to uncover and correct poor processes. Here, too, we could include making it easy for customers to complain - another source of rich information - research suggests complaining customers who are dealt with well have higher levels of satisfaction.

7. Fanning the flames
The message here is 'think communities'. Encourage your customers to share their positive stories with their networks. Get testimonials and be sure to share good news stories with staff as well. Social media has a huge part to play here and as we know it's cheap and easy now to take and post customer videos. Set up a loyalty scheme as well as rewarding existing customers for introducing new customers. Many companies find a family focus works where your product/service meets common needs. Think, too, about engaging with your local community through sponsorship or links with a local charity.

And finally, if you're so inclined score yourself on a scale
of 1 (low) to 10 (high) against these Accelerants.

Building a Pyrotechnic Business - 7 x 7 ‘Sure Fire’ Accelerants for Entrepreneurs

Acclerant 3 -7 Ways to Light Up Your People

1. Walk the Talk

It’s tough, but the people around you will be able to assess your mood when you walk in to a room pretty much instantly. In an office, that mood can permeate the room in seconds. It may go against the grain but aim for upbeat and smile, smile, smile. If necessary fake it! People will also be constantly checking – rather like a virus check –what you say against what you do. So, if customer service is your thing – as it should be – then make sure you remain customer focused in all that you do and say. Think of your suppliers and staff as customers too.

2. Attitude v skills

There’s a popular mantra that goes ‘Hire for attitude, train for skills’. Ideally you want both of course, and in some circumstances – where, for example, there is an urgent need short term for some pretty technical stuff - then you can park this. But if you’re recruiting people in to the business, and especially if they’re customer facing – then the right people focused, positive attitude is critical. Teams, too, tend to be more successful if members are positive and goal orientated and this goes a long way to creating a positive climate for your business.

3. It’s their business too!

Get people to take ownership of the parts of the business that they have the greatest ability to influence. Be clear with them how what they do contributes to the overall success of the business. Make sure that performance discussions are open, frequent and evidence based. Spend more time looking forward rather than backwards otherwise life becomes a series of post-mortems. Help your people become ‘intrepreneurs’ within your business so that they build their own entrepreneurial skills.

4. Hearts and minds

You want people to bring their whole bodies to work – that’s to say their hearts and minds. Shocking results from a recent survey revealed that more than half of the employees polled felt disaffected from their job and the company they worked for. For a small business, this level of overhead – effectively two people to do one job –is untenable. So, you have the challenge of engaging your people as fully as possible. What we have talked about previously here will help. Take a real interest in your people, find out about their families and what they do in their spare time. And above all catch them doing things right and give immediate feedback.

5. Doing it right

Make sure you’re doing the ‘right things right’ rather than ‘wrong things right’. It’s so easy to get sucked in to stuff that is energising, exciting and inevitably time consuming. But if it’s not moving the business on – and that’s you’re prime goal – then you’re just wasting time and perhaps other resources too. Are you spending too much time travelling around chasing marginal business? Has social media taken over your life? Are terrorist customers sapping your strength? If so you need to get a grip. Keep a diary for a week and see how you spend your time relative to your business priorities.

6. Hymn sheets

What do your people actually say to customers when you’re not there? What do they say on the phone and face to face? In this day and age, what are they saying too about your business on their texts, on Facebook and Twitter? The days of direct control may be gone but you still have the ability to influence. Make sure that uncomfortable conversations and differences of opinion are resolved within your business before they go public.  Get feedback from customers, both satisfied and unsatisfied and even ‘mystery shop’ your business yourself.

7. ‘Could do better’

Too many businesses drift along failing to address self-evident performance issues amongst their staff and suppliers. In the poll about disaffected staff, employers also reported that they felt that 25% of staff were ineffective. This is outrageous!  Is there something in our culture that gets in the way of dealing in a timely and effective way with unsatisfactory performance? The longer you leave it, the more you collude and the more your staff – who will know who the poor performers are – will doubt your leadership capabilities.

And finally, if you’re so inclined score yourself on a scale

of 1 (low) to 10 (high) against these Accelerants.

Building a Pyrotechnic Business - 7 x 7 ‘Sure Fire’ Accelerants for Entrepreneurs

Accelerant 2: The Pyrotechnics’ Toolkit

1. Focus

It goes without saying that there will be a lot going on when you’re running your own business. So, you’ll need to identify and focus on the ‘critical few’ that are going to make a difference to your business success. Amongst the fundamentals will be marketing, sales and cash flow. It’s also important to nurture key relationships including looking after yourself. Time management is of the essence so don’t procrastinate and put things off. Delegate where you can and recognise when you need to talk to experts because you’re moving beyond your own capabilities.

2. A Clear Business Model

Your business model is the way in which you create, deliver and get value for what you do.  This means looking at your business in a very objective way. Park your passion and excitement to really understand what core value you offer. It could be:

·         the actual product or service;

·         your ability to build collaborations and partnerships;

·         the reach of your network ;

·         your Intellectual Property (IP).

Whatever it is, this is the part of your business which you must monetise effectively.

Remember that the value may be monetary but it could come in other ways like altruism and personal satisfaction too. Many people who run their own businesses give generously of their time and experience.

3. Finding ideal customers

There is a tendency particularly when starting a business to believe that any customer will do. This is true up to a point because customers who buy are the acid test of your proposition. But don’t fall in to the trap of believing that all customers are good customers. Take time to identify the characteristics of good customers for your business (What do they buy? How often do they buy? Do they pay on time? What do they say to others about you?) and then make sure your marketing and sales activities are targeted at them.

4. Profit before turnover

This is, of course, closely related to the point above. Chasing more business to generate a higher turnover doesn’t in itself automatically generate more profit. There’s a saying ‘Turnover is vanity, profit is sanity’. Be very sure by understanding your costs and margins that every additional £1 of turnover delivers the appropriate benefit to the bottom line. Know your numbers and don’t lose control of your pricing – it’s the road to ruin!

5. Saying ‘No’

Can you see a pattern emerging here?  In the same way that your body is a temple so is your business. Don’t be afraid not to take on or to let go of customers who don’t meet your ideal customer criteria. For many businesses the 80/20 rule (or Pareto’s Law as it’s called) applies. Over time you will find 20% of your customers deliver 80% of your profit - in some businesses it’s even more marked, say 5% of customers/95% profit. Understand who these key customers are – pamper them and don’t let the long tail of the 80% wag your business for you. Watch out too for terrorising suppliers who want your business– just be totally but politely frank with them.

6. Being curious

Ok, so to counterbalance all the control stuff, take time to stay alert to what is actually happening in your business. If you’re meeting your goals then that’s great. However, be just as curious when you do better than you expected as you are when doing not so well. What is happening that you didn’t expect? What can you do to make more of this if it’s good news?

It’s helpful to stay in touch with what your competitors are doing – you may get some actionable hints. Who are the movers and shakers in your business – global, national and local? Pick a few and track what they are saying.

7. Failing quickly

Think of your business as a series of short term experiments. You’ll get some things right you’ll get some things wrong. If the balance is positive then you’ll be moving in the right direction. Don’t dwell on stuff that hasn’t worked but don’t lose sight of it completely. Just because something didn’t work once doesn’t mean it won’t work again – getting the timing right is everything.

Worst case is that actually your fundamental proposition is wrong and you need to start again completely. Don’t worry; if you’ve failed quickly you will have time and hopefully resources to move on. Remember too that you’ll be joining the ‘Serial Entrepreneurs Club’ – many business investors like to see you’ve got this T shirt!

And finally as for Accelerant1, if you’re so inclined score yourself on a scale

of 1(low) to 10 (high) against these Accelerants.

Building a Pyrotechnic Business - 7 x 7 ‘Sure Fire’ Accelerants for Entrepreneurs

Accelerant 1: Lighting your own Fire

1. Passion: Passion is a key ingredient if you are running your own business. You cannot expect anyone else to care more about what you do than you.  Your passion is an accelerant that is transmitted like wildfire through everything you say and do. People will notice it and respond positively – this is how you start to create a presence and build your business.
2. Motivation: If passion is a high revving engine, then motivation is the drive train. Without either you and your business will lack direction and energy. Motivation is not something you can outsource. So when you get out of bed in the morning get yourself into a positive frame of mind. Rate yourself on a scale of 1 to 10 where 10 is high. You need to be about an 8!
3. Half empty v Half full: How do you see the world – are you an optimist or pessimist by nature? If the latter, frankly you’re in for a very tough time. You need a positive mind set - seeing opportunities and challenges rather than problems and barriers. If you have a negative thought, think about how you might re-frame it in a positive way. Teach your mind to see the good before the not so good – it can be done!
4. Handling Rejection: There’s going to be a lot of this and it doesn’t really go away. The temptation is to view all rejection as personal but this is not usually the case. There’s a saying that there is no such thing as failure – only learning! It’s important then to understand where you can what the basis of the rejection is – it may cause you to revisit what you do and the way you do it.
5. Planning for Success: One of Stephen Covey’s ‘Seven Habits of Highly Effective People’ is to begin with the end in mind. If you’re just starting out then it clearly helps to know where you want to end up. Why? Because it will shape what you do and how you go about it.. It’s often helpful to think about what you yourself might be doing when the business is successful and capable of running itself.
6. Bias for action: Frankly it’s no good waiting for other people to do things for you – for just the right moment – you just need to get on with what needs to be done. Banks, governments, friends, family will all have their own agendas and go at their own pace. It’s no good thinking if only this, if only that. You need to take responsibility and make things happen. It’s very rarely that things are absolutely perfect – so make the most with what you’ve got.
7. Reaching Out: Are you one of those guys who doesn’t like to stop and ask for directions? If so, think again and next time give it a try. You won’t know all you need to know to run your own business. Successful entrepreneurs build a support structure around them – people they can turn to for knowledge yes, but also people they can turn to for empathy. Choose your people and networks carefully to make sure they can deliver on both counts

And finally, if you’re so inclined score yourself on a scale of 1(low) to 10 (high) against these accelerants. I’m going to ask my network what they think a good score should be.

Note: Accelerant 2 will follow shortly