The Sears Problem and Theory Validation

'Tis the Season for a great many things, including holiday shopping and evaluating the resulting retail profits. Some of this years' results seem to bear out the underlying philosophy of this blog.

As reported on the Dow Jones Newswire: “Sears Holdings Corp. (SHLD) plans to close as many as 120 stores and take a charge of up to $1.8 billion as the struggling retailer reported fewer sales during the all-important holiday season, again raising questions about the company's ability to regain lost momentum.” The article went on to say that the company plans to take the money saved by these store closings and re-invest it into the store facilities and in their customer loyalty program.

Investors aren't impressed.

Share prices have fallen 25% over the last 12 months, and fell by another 25% on the announcement.

SHLD owns the Sears and Kmart stores, with about 2200 locations in North America. These brand were the kings of American retail a few decades ago. So what happened?

Sears was the biggest name in department stores. They were famous for their catalog, and they were the place to go for appliances, tools, and quality clothes at reasonable prices. They competed against Montgomery Wards and JC Penny on the clothing, but nobody put the whole package together as well as Sears. Kmart was the top discounter in the nation, when the only competition was Woolco.

The competitive landscape has changed.

• I buy most of my clothes at specialty clothing stores.
• I buy tools at the big-box hardware stores.
• I can buy brand-name appliances at numerous retailers.
• If I want to shop at a discount store, I head to the big W.
• And no one but my 95-year old mother shops from a catalog anymore.

So what, one might ask, are Sears and Kmart particularly good at these days?  

NOTHING, it would seem.

Business mediocrity comes in many business forms, but the most common marketing example is the “Me Too” image. Neither of these companies do anything particularly noteworthy, and their marketing image is simply one of the many Me Too's.

Mediocre operations can survive when the competition is weak and the selling environment is strong. But when the competition is strong and the economy is weak, the mediocre have few advantages to promote. The only option left is to constantly lower prices, and they aren't well positioned to do even that. As a consequence, they often die a slow death.

Although it doesn't make the headlines, small businesses go out of business every day for exactly the same reason: They haven't figured out how to stand out, and the buying public sees them as just another “me too” operation. If your company falls into this category, NOW is the time to make some changes.

Practical Tip of the Day:

• What is your company known for in the buying community? Don't trust your analysis of this, take the time to ask your customers for their opinion.
• If the answer is “Nothing”, but your sales numbers are still OK, then your competition is in the same boat, and you still have an opportunity to succeed. Start looking for some key differentiation.
• If the answer is “Nothing”, and your sales are drifting downward, Now is the time to respond.

The Great Sales Training Myth

As mentioned in previous posts, I have worked for several organizations, in both sales and marketing positions. Some of these companies were very large and (supposedly) well organized, while others were small operations trying to grow any way they could.

One phenomena I often saw involved the Great Sales Training Myth. The purpose of the myth was to excuse management from having to provide any relevant training for the sales staff. It wasn't phrased that way, of course. Instead, what you heard was:

• “We hire only professional sales people, who are already trained.”
• “If we gave them more training, they would just leave and go somewhere else.”
• “The good ones would be offended if we tried to tell them how to do their job.”
• “If they would just work harder and sell more, everything would be fine.”

And to all of those bosses who used these excuses to save themselves some money and effort, I say You are Complete Idiots!

The sales staff is the customer-facing part of the company. These are the people who interact with your customers every day, for good or bad. If the sales staff doesn't create a great impression in the mind of your prospects, all of the money spent on advertising has been wasted. If the sale staff can't effectively close leads because they don't know (in detail) how customers use their product, then all of the marketing efforts are for naught.

A well-trained sales staff can make up for weak marketing, but it can perform twice as well when given the benefit of great marketing. But even a well-trained sales staff cannot make up for weak product or poor customer service.

Lets answer the four excuses listed above:

1. Even “professional” sales people bring both the good and bad experiences from their past employment with them. You should take the time to train them to seek the customers you want, to promote the benefits you offer, and to make the kind of lasting impression you deserve.
   
2. Good sales people want to be successful, and they want some appreciation for their work. If you don't invest some training time into your staff on a regular basis, they will look for other job opportunities that do offer the recognition they seek.
   
3. The “good ones” want new opportunities to succeed, and will be ready to soak up any good information you can offer. This assumes, of course, that you really know what you are talking about. The good ones don't want you to waste their time.
   
4. Finally, if you really think that having your sales people “just work harder” will bring great results, you most likely have deeper problems to deal with. It's usually a general marketing problem, not a sales problem.

Don't skimp on training and skills development with your sales staff. A small investment here can have a huge pay-off.

Practical Tip of the Day:

In addition to the points listed above, your sales people should be a great source of information about the competition, and your customers' expectations. Get your people together often, and listen with an open mind to what they have to say about their selling environment. It can be very enlightening.

The GE Marketing Position Strategy

General Electric is rather unique in the world of business these days: they operate as a conglomerate. A popular business format in the 70's, the conglomerate lost its luster in later decades as some of the largest ones imploded. But GE seems to be able to pull it off. And a key reason is their Market Position Analysis.

General Electric has numerous divisions and makes a wide variety of products, including:

• Wind Turbines
• Power Plant Generators
• Airplane Engines
• Advanced Healthcare Screening Devises
• Locomotive Engines
• They own ½ of NBC Universal
• and they do a dozen other things

I was intrigued with a key financial tool they used for managing investment across their various product lines. The process starts with an honest assessment of where each product ranked in its own marketplace. Each product was evaluated, and put into one of three categories:

1.) If the product was ranked among the top three in its industry / market segment, it was provided the investment necessary to keep it there.

2.) If the product was not in the top three but had strong growth potential in the near term, it was given the investment necessary to get it into the top three.

3.) If the product wasn't in the top three, and wasn't likely to get there, the investment of new funds was stopped, the division was milked for cash or, often, sold.

Here's the reason:

The top three companies in any market generally offer strong value, and have the pricing power to earn reasonable profits.

All of the other companies in the market end up competing on price, and earn little or no profits.

So GE invested its capital in products that were proven winners, and products that had strong potential growth. It cut its losses on those that never really made it, or had run their course.

Applying the lesson to small business

Contrary to the logic used by many entrepreneurs, a small business needs to be even more focused than its larger competitors. Here's why:

• The small operation has even less cash available to invest in non-winners.
• The small operation has even less management capacity to invest in low-profit lines of business.

We strongly recommend that each business periodically undertake a Line Of Business Review. This LOB analysis should be run for each segment of your operations (either product or services). It should detail not only your sales per each LOB, but also look at customer groupings and net profits for each segment.

It can be a lengthy process to do all of this analysis, but the results will help you do a better job of tailoring your business for the future.

Practical Tip of the Day:

Once you have completed your LOB analysis, ask yourself three questions:

1.  Which products are at the top of their field, and could justify a margin increase?
2.  Which products could be enhanced to get them to the top of their field?
3.  Which products could be dropped without having a negative impact on your bottom line?

The Tiered Elevator Pitch

For years, business people have been encouraged to develop an “elevator pitch”: Something that would describe their business, and could be given during a short elevator ride. As a management tool to help people focus on essentials, and to develop a succinct presentation, this has some benefit. As a marketing tool to help promote your company, it has limitations.

The most obvious being this: People who casually ask about your job don't really care.

It's like that adage about personal communications: “How are you?” is really a greeting, not a question.

However, a while back I came across this idea of a tiered introductory pitch which intrigued me. I couldn't find the reference in my personal library, and I don't remember the author (she was a Hollywood writer or agent, I believe), but I remember the concept and I think it has legs

Recognizing the problem mentioned above (most people don't really care about your answer), the tiered approach starts off with a teaser line. So, instead of saying “I am a real estate agent”, you might say “I help people find their dreams”. Instead of saying “I am an accountant”, you might say ”I am a master of the financial arts.

All of which leads to one of two responses:

1. “Oh, How interesting. Have a nice day.” (They weren't interested anyway.
2. “That's interesting. Please tell me more.” Or, “What do you mean by that?”

If you get the second response, they really are interested in hearing more, and you can give them a more traditional introduction that spells out what you do.

If you put some thought into this, you can even come up with a second line that is more specific, but still leaves some mystery. The listener is now truly engaged, and will pay close attention to your pitch.

Even if they aren't really focused on your answer, you have presented yourself as both interesting and memorable. That gives you an advantage.

This multi-step approach allows you to give your best, focused introduction to people who are really interested, and won't be bored with your answer. And having an engaged audience is always more fun.

Practical Tip of the Day:

• Throw this idea out to your staff, and see what they come up with.
• Perhaps, as a group, you can come up with 2-3 standard introductory pitches to use, depending on the situation.
• Once you find some appropriate lines, practice them until they feel comfortable, AND THEN USE THEM.

How Does Your Business Card Sound?

If you've read my previous posts, you know I believe in having a tight company focus. If everyone in the company is focused on doing a few things very well, you have a much better chance of success....if you also communicate in the same way.

One approach to improving your communication is known as the Aural Business Card.

Side Note: This is also sometimes called the Oral Business Card. However, “aural” (what people hear), is more important than “oral” (what you say), so I prefer the former.

Imagine yourself in the following setting: you are a visitor at a Chamber of Commerce mixer, with hundreds of attendees. People come up to you during the evening, shake your hand, and ask “what do you do?” How do you reply?

When we run this exercise at seminars, we get all sorts of answers:

• The long, rambling explanation that wouldn't fit on a brochure, much less a business card.
• The too-short reply that mentions the company name, but not what it actually does.
• The technical product description that few people can understand.
• And a few that are short, simple, and to the point.

The preferred form is the Aural Business Card: One or two sentences that state what your company does, and some additional point that sets you apart from the competition. It's an approach that people will remember.

Here is what it should include:

Part A.)  “I am with XYZ Company.” 

“I own...” or “I am a partner in...” also work here.

Part B.)  “We do ABC, specializing in DEF.”

Don't start this section with “I”, even if you are a 1-person business. Find a way to say “we”, or “our company.” Something that makes you look bigger than just yourself.

Make the ABC part generic enough that everyone can easily grasp what you do. Assume your audience isn't as conversant with your industry as you are.

Make DEF some feature that sets you apart from the competition. If that person at the Chamber mixer meets 10 people who say they sell insurance, he won't remember any of them. If you say you specialize in Key Man Insurance, you will be easier to recall.

 Some examples:

• We sell deli sandwiches at lunch time, specializing in mid-town office delivery.
• We manufacturer metal storage racks, specializing in industrial refrigeration installations.
• Our company provides bookkeeping services, focusing on independent retailers.

Have another 2 or 3 sentences ready and waiting for the person who wants more information. But wait until they ask before trotting them out: In the introductory stage, the more you say, the less they hear.

You can change the words to make them fit your situation, but you should have a statement available that covers all of these points.

Practical Tip of the Day:

Create your own tightly focused company introduction.
Practice it enough so it rolls off your tongue.
Get everyone else on your staff to use the same line.

It may take some work to create this introduction, but it's well worth the effort.

NEXT POST: The Tiered Elevator Pitch

Make a New Plan, Stan.

I have worked for companies large and small, US and Canadian, with Japanese and domestic management. I have seen a wide variety of planning techniques, strategies, and implementations. And, you won't be surprised to learn, much of the effort put into their planning was wasted.

In large organizations, senior management assembles The Plan at the start of the year. It is then set in stone, and set on the shelf to collect dust. In my opinion, a very poor approach.

In small organizations, by contrast, there often really isn't a Plan. Also a poor approach.

So what makes a Good Plan?

Successful companies see planning as an on-going process that periodically produces a temporary document, called The Plan.

The purpose of the process is to determine:

• What's working, and what's not
• What shifts in the marketplace are creating challenges
• What adjustments need to be made NOW to meet those challenges

The process should be a collaboration between those that are close to the market (sales, marketing, customer-facing staff), those in touch with industry trends, and those that can re-allocate resources.

The purpose of the document is to:

• Communicate the near-term goals to every staff member
• Coordinate everyone's efforts
• Keep resources from getting dissipated on secondary tasks

If your planning process hasn't providing the bang you had hoped for, here are some thoughts:

First, Scrap the Annual Plan

I saw this in action while working for Japanese organizations. They prefer a 6-month planning time frame, and base their performance compensation on the 6-month goals.

A 12-month program stretches out too far. Market conditions can change significantly over that length of time, making the plan irrelevant. Also, a 12-month deadline is so far off that the hard projects just keep getting push back.

A 6-month time horizon is long enough to tackle big projects, and short enough to keep everyone focused.

Next, Don't make the Plan about Numbers

The focus of the plan should be on:

• the projects you want to get done
• the people you want to train
• the new markets you want to open up
• the new products you want to get out on the store shelves
• etc.

It should be about the changes you want to make so that the company is better positioned for the future.

If you are doing the right things and focusing on the right issues, the numbers will follow. Putting too much emphasis on the numbers causes staff to take short cuts that look good in the near-term, but don't move the company forward.

Finally, Share the Plan with Everybody

Don't keep it a secret from your staff. Share the plan, share the logic behind the plan, share your belief in how achieving the plan will make the future better, and (often the hard part) solicit their opinions. The further you go down in the company hierarchy, the closer you get to the customer. And that's where you will find the ideas that can really make a difference.

Practical Tip of the Day:

• Can everyone in the company tell you what the key objectives are for this quarter?
• Do you staff refer to the plan regularly to see which projects should be given priority?
• If the answer is No, throw out the plan binder that's just sitting on your shelf, and start over.

Vive La Difference!

A technical term often used in marketing discussions is the USP: Unique Selling Proposition ( or, sometimes, Unique Selling Point).

It refers to something offered by the company that the competition can't/ won't/ doesn't match. It is a great way to get the buyer's attention.

Having a USP creates a superb marketing benefit, but only if it is actively promoted. Which brings us to today's topic:  Comparative Advertising.

I LOVE comparative advertising! I think it exemplifies what great marketing is all about.

The first time I remember seeing this approach was in a television ad for Wilkinson Sword Blades. This was back in the day when the US shaving market was dominated by Schick and Gillette. Wilkinson, the big British company, was trying to break into the market with its new, plastic coated blade. The commercial was simple: a small table, with 4 packages of blades from the major US companies. A hand appears, brushes the competitor's products to the floor, and places a pack of Wilkinson blades in the middle of the table. The announcer states that Wilkinson Sword makes the best blades anywhere, and the commercial ends.

The advertising community was shocked. Mentioning your competitors, particularly in a negative manner, just wasn't done. Complaints were made to the FTC (Federal Trade Commission), but they held that comparative advertising could benefit consumers and encouraged it, provided that the comparisons were “clearly identified, truthful, and non-deceptive.”

What constitutes “truthful and non-deceptive” has been debated in many court cases since, but that hasn't stopped the practice. Some great examples through the years include the famous “Pepsi Challenge” and, more recently, the very clever “Mac vs PC” ads. (Here is the Youtube link to those ads.)

The automotive companies make extensive use of this technique today, particularly in their truck advertising. The Ford ads with Dennis Leary, and the Chevy ads with Howie Long, both state their advantages over the competition. They tout their mileage, power, and towing statistics, and they name names. It is powerful, and persuasive.

So, why don't more companies use this tactic?

We can assume it's because:

• They wish to appear to be “polite”
• They don't want to mention the competition's name
• They haven't figured out a USP
• They don't want to encourage a counter-attack

In my admittedly-radical point of view, if you don't have a USP, you really shouldn't be wasting money on advertising. I am a big believer in addressing the customer in manner they consider relevant, and in answering the Big Question. As detailed in an earlier post, before someone makes a purchase from your company, they endeavor to find an answer to the Big Question: “Why should I buy from you, rather than 6 other companies that do the same thing”.

Comparative advertising certainly attempts to answer that question. Are your ads as effective?

Practical Tip of the Day:

• What sets your company apart from the competition?
• What do your customers like about your company, as compared to the competition?
• Do you promote those qualities in your advertising?

Letting Go is the Hardest Part

I had a great conversation over coffee the other day with an acquaintance that runs a small business in town. He'd read my posting touting the benefits of focused product lines, and had a major objection. His argument boiled down to this: He needs all the business he can get, and can't afford not to offer a wide range of products and services.

I understood his plight, and I paid for his coffee. But I don't agree with his analysis.

If his objective is to earn enough money to pay his bills this month, I can see his logic. If, however, he is trying to build his business for the long term, he should take a different approach. I recommend the following:

Part One: Find a unique niche that will provide both sales and profits.

This is a three-step process:

• Find a product or service at which his company truly excels, and
• the competition does not do particularly well, and
• that appeals to a significant segment of his market.

I know, that seems like a big, perhaps impossible task. Isn't everything already being done? Aren't the competitors already in the lead in these areas? Not necessarily.

Most competitors are not particularly innovative, and customers are always looking for new products and new ways to do things. There are often unexplored niches available to exploit. And all significant profits come from providing something the competition doesn't have.

Many business people will say they differentiate their business from the competition in some way. Observe them at work, however, and what you see is their daily attempts to convince customers that they are:

• Nice people to work with
• Willing to work hard for their customers 
• Always eager to offer a discount to get some business.

Two problems with this approach: It doesn't set them apart from the competition (who are doing exactly the same things) and it doesn't give customers a compelling reason to buy from them. (Read The Big Question post here.)

So get going, find the one big thing that will set you apart from the competition, and then move on to

Part Two: The really hard part, Letting Go.

The first part is undoubtedly difficult, but it deals with pragmatic, quantifiable issues. Part Two is much harder because it has an emotional impact. Part Two involves Letting Go of something.

• Your staff is already busy doing things they assume are important.
• Your management group bandwidth is already stretched working on existing projects.
• Dedicating time and resources to the new focus (as determined in Part One), requires eliminating some current activities.

It may be some products or services, it may be some territories or some specific customer groups. It won't be easy, and it may feel like you are being asked to cut off one of your arms. However, not all products, territories, and customers offer the same profitability or have the same future potential. They do, however, all soak up resources that would be better applied to the new focus.

Calculating what to eliminate may not be highly difficult, but actually Letting Go can be extremely hard to do. That will be the true test of your leadership skills.

Practical Tip of the Day:

Look for some new ideas that will set you apart from the pack.

• Listen deeply to your customers. What are they looking for that you aren't providing now?
• Listen to them again. What do they dislike about your competition?
• What are the innovators in your industry doing to set themselves apart? Are there any clues here you can adopt?

My Favorite Steve Jobs Quote

Tons of newsprint and an enormous number of megabytes have been dedicated in recent months to the wisdom of Steve Jobs. Every article seems to include the word “genius” at least once, and every utterance has been poured over looking for significance.

There are websites devoted to his wisdom, and several lists of his most famous quotes as the high-priest of technology. My favorite quote, however, comes from a more distant past; before his successes with the iPod, the iPhone, and the iPad. My favorite is also directly relevant to small business management.

Let's go back to the mid- 90's, and remember how the computer industry was structured at the time. The top players in the industry were:

• IBM, run by Lou Gerstner, a marketer with great credentials from his time at American Express and RJR Nabisco, the tobacco / snack food giant, and
• Compaq, run by Eckhard Pfeiffer, the former financial controller at Texas Instruments.

These were the biggest players in the industry, and had the lion's share of the business computing segment. Steve Jobs wanted to make the point that business buyers were best served by dealing with companies that had leading edge technology, comprehensive software-hardware integration, and leadership that would create great products both today and in the future.

While speaking to a conference of business leaders, Jobs said:

"Never buy a computer from a company where the CEO can't do the product demo."

(Note: I couldn't confirm these words in my on-line research, but that is how I remember the line.)

I was blown-away at the time with the wisdom and simplicity of the concept, and it applies today to every business, not just computers. Here's why: To do a competent product demo to a customer, you need to know

• The product, and how it compares to the competition, and
• The customer, how he uses the product, and what he wants to accomplish.

If you don't have both sets of knowledge, you won't deliver a compelling demonstration.

And if the leadership at the top of an organization isn't equipped with both sets of knowledge, the company won't have the focus needed to deliver long-term benefits to their customers. It doesn't matter which industry you pick, the concept is the same. For a company to succeed, the leadership needs to understand the product, the competition, and the customer. It also needs a vision about where each of these three components is headed.

I just finished a great book: Car Guys and Bean Counters, by Bob Lutz, certainly a “genius” in the automotive industry. He must be a genius; He agrees with me on this issue.

In a section discussing the decline of General Motors, he describes how car design decisions were being made by marketing types that had earned their reputations selling laundry soap at Proctor and Gamble.

He writes, “Shoemakers should be run by shoe guys, and software firms by software guys, and supermarkets by supermarket guys.” And, obviously, car companies should be run by car guys.

It doesn't matter what industry you are in, if the boss hasn't got in-depth knowledge of both the product and the customer, you will see that reflected in poor product development and weak marketing decisions.

Here's a great BusinessWeek article on the book.

Practical Tip of the Day:

How far down in your organization do you need to reach when its time to give a great demonstration to a new account? If the head person can't do a compelling demo, that's a sign of major organizational weakness.

Why Building a Successful Small Business is Hard.

A reader of this blog has asked my opinion about small business owners in general. I have made critical comments here about typical small business marketing strategies and advertising concepts, but I am a big fan of those entrepreneurs who create successful companies.

It is very hard for a small businessman to become a success, and I have great respect for those who create thriving organizations. The fact that it is hard to do, however, does not excuse the poor examples of marketing that one sees every day.

But why is it harder for the small organization?

Because the small company suffers from two significant drawbacks:

• lack of expertise in multiple disciplines
• lack of a regular infusion of new blood / new ideas.

If you examine the structure of a company with 100 or so employees, you will typically find 7-10 key executives involved in most major decisions, and they will often bring a large and varied experience set to the decision-making process. In the small organization (20 or less employees), you will commonly see on 2-3 decision-makers, and they often have most of their experience within the same industry.

The second phenomena found in larger companies is staff turnover in the middle and upper ranks. Each new employee brings in new ideas, and sees the industry / customers / competitors from a different perspective. It is the mixing of these new ideas with the tried-and-true that gives birth to creative solutions.

In the small, or family-owned business, operating ideas can easily become “inbred”, and can remain in force long after they have become stale. And groups that pride themselves on very low turnover (whether social, political, or business) tend to suffer from stagnation.

Isn't that why I pay outside professionals?

Yes, absolutely, and they have their place. Recognizing this disadvantage inherent in the small business environment, the entrepreneur should be constantly seeking sources for new and innovative ideas. Lawyers and accountants typically fall into this “outside professional” category. Unfortunately, they also tend to focus on specific issues that you bring to their attention.

Another source for ideas can be a board of directors or advisors. If the owner can build a network of people who will serve in this capacity, it can create a significant advantage over the competition. This strategy needs two elements to be effective:

• The advisors must represent several different experience sets and viewpoints
• They must be allowed to see the whole picture, warts and all.

Neither is easy to do. Too many small business operators prefer to stay in their comfort zone, don't go looking for new ideas that would upset the apple cart, and end up missing out on the benefits of outside viewpoints.


Practical Tip of the Day:

• Take a good look at the people involved in you major decision-making process. How many have had extensive experience outside of your company within the last 10 years?
• Take some time to review the strategies of your competition. Do they seem to be moving off in different direction? Are you still using the same basic game plan that you used 5 years ago?
• Do your customers consider your company to be “leading-edge”, or so they see you as being in the middle of the pack?
• If you are not happy with what you have found with this review, go out looking for new answers, from new sources, from people outside your industry. It could lead to some revelations.

And How Would You Define “Marketing”?

The term “marketing” has been used by so many people to mean so many different things, it's no wonder that people find it confusing. Rick Pence defines marketing as the activities that precede the sales conversation. My best description of the term is to say that the purpose of marketing is to create a qualified sales lead.

Too often, people use “marketing” when they really mean “advertising”, and sometimes it is used as a substitute for “sales”. While these concepts are all inter-connected, the important marketing activities occur before the advertising kicks in. These early-process activities are sometimes referred to as strategic marketing.

What is it?

In the world of small business, marketing is the triangulation of three things:

• The benefits that your products / services provide, as compared with
• The benefits on offer from the competition, as compared with
• The wants and needs of your target buying group.

An effective marketing plan will offer an in-depth analysis of these three components, and will produce the single most important marketing tool: The Message.

In an earlier post, I discussed how most small business advertising fails to answer the Big Question. To save you going back and looking it up, I'll remind you: Before making any significant buying decision, the customer asks, “Why should I buy from this company, instead of 6 others that do the same thing?”. If you don't answer the Big Question, you don't have much chance of getting the customer's business.

That's where The Message comes in. It gives the customer a great reason to buy from you rather than the competition, and is formulated in a way that resonates with the buyer. The Message clearly states the unique extra value that you offer.

Once The Message is formulated, everything else gets easier:

• Advertising can be created to push the message to the targeted (receptive) audience
• Leads will come in from prospects that are attracted to the message
• Sales staff can tailor the message to the needs of individual buyers

And why doesn't it get done?

Because, too often, the small business owner prefers to stay in his comfort zone. Further, practical business people often prefer the tangible (What deals did we close this week?) over the intangible (How do our customers perceive our value proposition vs the competition?).

Additionally, there is the Never Quit Credo, which condemns many businesses to endless mediocrity. More on that later.


Practical Tip of the Day: 

     Does your advertising really give your prospects a good reason to buy from you instead of the competition?  If not, try this 4-step approach:

• STOP YOUR ADVERTISING ! It isn't really working anyway.
• Bank your savings, to use when you have something better to say..
• Analyze your top 25 accounts, and determine why they buy from you instead of the competition. (Hopefully, it isn't just price.)  If you are having trouble figuring this out, ASK THEM.
• Create a message based upon these strengths, and re-build your advertising campaign according.

Avoiding the 2 B's of Advertising – Part 2

In the last post, we talked about Baloney. Today's blog topic is about Bumph.

Although they are both prevalent in poor advertising copy writing, they are different subjects. As a reminder, Baloney refers to half-truths, distortions, and falsehoods. Bumph, on the other hand, is less tangible. Simply put, it is “filler”: All the extra lines of copy added-in to fill out the page and make it look like you are saying something important.

Every line of Bumph copy may be absolutely true, it just isn't considered relevant by the reader. The danger with Bumph is not that the reader / listener won't believe what you say. Rather, after 2-3 sentences of useless verbiage, they decide the message doesn't apply to them and they tune you out.

I hope that hasn't just happened here!

The real problem with Bumph is that it hides the message you are trying to communicate. So why is it so prevalent in small business advertising? Let's look at some examples, and then we'll look for some reasons.

• Been in business for 23 years.
• Largest supplier in town.
• Come visit our friendly staff.
• We have been working hard to bring you the very best.
• We put the customer first.

And the list goes on and on. Perhaps every one of these statements are true, but when the audience sees/ hears this type of line, they ask “So what?” They wonder why you are spending your advertising dollars telling them these irrelevant things. At which point, they tune you out and your advertising dollars have been wasted.

Why is Bumph so common?

• The copy writer is lazy, or has been told to use some of the boss's favorite lines.
• The printer wants more copy on the page to balance the look.
• The businessman doesn't have a clear message to communicate.
• Decision makers haven't thought through an answer to the Big Question.
• The piece was designed to target multiple audiences.

This last option may seem reasonable and cost effective. However, it ends up being a waste of money. In an effort to say one thing to audience #1, and something different to audience #2, the primary points end up getting swamped with unrelated copy and the message gets diluted. You are much better off giving one strong message to one audience, and making a big impression.

Bumph is everywhere, and distracts from the purpose of the communications. If you cut away both the Baloney and the Bumph, you will have far fewer words but they will be much more powerful.

Practical Tip of the Day:

• Look over all of the advertising copy from you prime competitors. Try to look at this material through the eyes of your target audience.
• Use a highlighter to identify the statements that qualify as either Baloney or Bumph.
• How much impactful copy is left?
• How does your advertising material compare?

Avoiding the 2 B's of Advertising- Part 1

In the next two postings, I will discuss some highly technical marketing terms:

Baloney, and Bumph

These two examples of bad copy writing appear far too often, and afflict all kinds of advertising.

We will start with Baloney, which is a polite way of saying:

• lies,
• half-truths,
• exaggerations,
• distortions,
• falsehoods,
• fabrications,
• deceits,
• fictions,
• hyperbole,
• and plain, old B. S.

Readers quickly identify this material and recognize it for what it is. And once a reader picks out something considered Baloney, they disregard the other claims in the advertising.

So, why are these types of statements used so often?

I'll answer that question in a moment. First, lets look at some examples of commonly-used marketing Baloney:

• Fastest Service in Town
• Lowest Price Anywhere
• Friendliest Service in the City
• If elected, I will lower your taxes
• As Mayor, I promise to represent all of the voters
• I've never done this sort of thing before
• Satisfaction Guaranteed
• Sale Extended due to Overwhelming Demand
• This may be your last chance to get rates this low

Some of these examples are from business advertising, some are from the political arena, and some are heard on the social scene. They all have something in common, however the audience thinks of them as Baloney!

Here is a critical point in this discussion. It doesn't really matter whether the statement is true or not. It only matters that the listener thinks it to be false, or at least highly suspect. That's what defines a statement as Baloney.

Now, back to the earlier question. Why do these statements appear so often in small business advertising? Four reasons come to mind:

• The businessman thinks the customers are rather stupid; the least likely scenario.
• The owner has come to believe his own advertising (has drunk the Kool-Aid, so to speak).
• The copy writer is just too lazy to create effective copy.
• The statements may actually be true, but are unsupported.

This last option is rather common. The advertising claims are true, but aren't automatically believed by the audience and are classified as Baloney. As a consequence, the whole ad becomes tainted.

How do you address this problem?

If you are going to use a statement that a skeptical audience might find hard to believe, add some support.

Instead of:      We have the best sandwiches in town.
Try:                Winner of Daily Gazette's Most Popular Sandwich Award three years running.

Instead of:      Fastest Service in Town.
Try:                In and Out in 10 minutes, or it's free.

Instead of:       Lowest rates available.
Try:                 If you find a lower advertised rate, we will match it.

You can see the point here. Make a statement that the public can believe, and that they think is credible. Don't just blow smoke. They will see through it every time. It doesn't make sense to pay for expensive advertising media, and then send a message that isn't believable.

Baloney is everywhere, and it is a huge waste of advertising dollars. Don't let it waste yours!

In our next post, we will discuss the other “B” you should avoid: Bumph.

Practical Tip of the Day:

• Look through your marketing materials, and tweeze out statements that could be considered suspect.
• If a statement has some real positive impact, find a way to support it.
• Tighten up your copy, add some more credibility, and you will gain the public's trust.

Don't Argue, Less Really is More.

When I introduce the subject of Less is More in advertising seminars, I immediately get some push-back. How could less advertising be better than more advertising?

I answer that I am not really talking about advertising frequency or budgets. Rather, the point applies to advertising messages. Especially for small business.

The purpose of an advertising event is to make an impression on the audience. Obviously, a positive impression is preferred. And, as mentioned in an earlier posting, the key to doing that is to answer The Big Question.(see The Big Question post.)  You can't do that effectively if you try to be all things to all people.

Which brings me back to Less is More. If you have a huge advertising budget, like McDonald’s, you can afford to run multiple campaigns with different messages. They run campaigns for breakfast, new salads, new coffee options, and kids meals, all at the same time. And it works for them.
It won't work for you (assuming you run a small business).

Why? Because everyone seeing/hearing a McDonald’s ad already knows exactly what they are and what they offer. They use their commercials to mention something new, or to re-enforce an already-known image.

If you operate the typical small business, most people don't really know your company, or what you can do for them. Very few know how you are different from the competition. Even if you have been around for decades, most of your prospects haven't used your services and have only a vague idea about your operations. And you don't have millions of advertising dollars to spend telling them.

 FOCUS

Pick one area of your industry to specialize in, make sure you do that one thing far better than the competition, make that one thing a key element of every part of your company, and use your advertising to
pound away at that one message.
Somewhere between the 3rd and 5th time your audience hears / sees you advertising on that one message, they will finally assimilate the general idea. (Remember, they aren't paying close attention, so you need to hit them hard and often to get the message across.)

The objection I most often hear to this philosophy runs like this. “We do many things, and don't have money to run lots of commercials, so we must make each one tell our whole story.” While this argument seems logical on the surface, it ignores the most important element: the audience. They aren't really paying close attention, and the MOST you can reasonably hope for is that they will take away one thought from your ad. So make it a big point, and make it count. All of the extras you throw in will just get lost in the noise.

How will you know if the Less is More strategy is gaining traction? First, new customers will start calling and asking about the One Thing. Second, you will get your competition's attention, but they probably aren't reading this Blog, and won't be smart enough to respond effectively.

Practical Tip of the Day:

• Gather up all of the advertising / promotional material you used in the last 2 years.
• Make a list of all the products, services, features and benefits, and customer value you mentioned in those ads.
• Look for 2-4 that make up a common theme, and that (hopefully) set you apart from the competition.
• Build your ads around that one theme for the next 6 months, and watch the impact.

The Big Question!

 There is an old adage in advertising that says:

“Half of my advertising dollars are wasted. I just don't know which half.” 

Anyone who has tried to amp up the effectiveness of their advertising program has had to struggle with this reality, and easy answers are hard to find.

In my personal experience (for more see "About Us") , this old adage is still highly relevant. HOWEVER, it really only applies to large organizations with well-funded marketing departments (more about this issue in a later post).

The rule for small business is rather different:  80% of all small business advertising is wasted ! 

This radical opinion is based upon my informal survey of hundreds of small business ads in newspapers, magazines, and direct-mail pieces, and on radio and television.  I believe most of them to be poorly thought out and generally a waste of money.

Before I proceed, let me state:

• I am not against advertising. In fact, I am an ad junkie. 
• I am not against any of the above mentioned media or their copy-writers. (My feelings about their sales staff are not as positive.) 
• I am not saying that small business owners are foolish, purposefully wasteful, or stupid. 

But I do believe that 80% of their advertising dollars are being misspent.

How do I justify this audacious claim? 

Because so little of the small business advertising I see even attempts the answer the Big Question!

In this over-hyped and saturated media environment, the audience will spend about 10 seconds determining if you are going to address the Big Question. If they decide that the answer is “No”, they just tune you out.

If your ad doesn't immediately address the Big Question, your money has been wasted!

OK, so what is the Big Question? 

Simply put, someone exposed to your advertising asks this question:

“Why should I buy from this company, as opposed to a half-dozen others that do the same thing?” 

Your audience knows your competitors. They want a reason to do business with you instead of your competitors. Most small business advertising doesn't even pretend to tackle this issue. The message most often communicated is simply “please buy from us, because we are in business too”. From the audience viewpoint, that message is just lame.

The reason most small businesses don't tackle the Big Question in their advertising is that they haven't figured out the answer. My advice: Stop all of your advertising immediately, and figure out the answer before spending another penny.

Practical Tip of the Day: 

• Gather up all of your advertising and promotional material for the last 2 years. 
• Have your sales staff go through every line and highlight each sentence that helps differentiate your company from the competition. (Caution: only select those issues that your customers really consider relevant.) 
• Try re-writing your advertising copy using only those highlights sentences.