How To Market A New Product

So you’ve invented the next great gadget, and you’re sure it’ll be a hit. In fact, you’ve got cartons of inventory stored in every room of your house that you’re itching to sell, sell, sell. Your test market said they love it, but how can you reach the legions of consumers you’re sure will want to buy it?

Welcome to Sales 101. While there are countless books you can read about sales and marketing, here’s a relatively simple, proven strategy that’ll teach you how to market a product and grow your sales.

Create a Sales Plan
First, define your market as accurately as possible so you have a deeper understanding of exactly who you’re selling to. For example, instead of all women, it may be working women with above-average incomes and kids under age 5. Instead of all men, it may be divorced men in their 40s with six-figure salaries. The more specific you get, the more accurately you’ll be able to target your sales and marketing efforts, choosing the sales channels most receptive to your product.

Next, you’ll need to develop a sales plan. Before you groan, “Another plan,” understand this can be a simple document for your eyes only that’ll help you organize and think through your sales strategy. Write it in a way that makes sense for you. Typically, it should include the following:

  • Sales goals: These goals should be specific and measurable, not something like selling a million units. Base them on the nature of your product and try to break them down into manageable parts. For example, sell 50 units to end-users in 30 days and sell 100 units to local independent retailers in six months.
  • Sales activities: These are your tactics–how you plan to make the sale. You may say you’ll sell direct-to-consumer through a website or via craft shows, for instance. Or this part of the plan may include activities like developing a sell sheet to send to independent retail stores.
  • Target accounts: Your sales plan should also include the accounts you want to sell to. If it’s end-users, for example, plan how you’re going to reach them through eBay, classified ads or your website.
  • Timelines: Put dates to all of the above elements so you can define your steps within a realistic timeline. Don’t forget that your timelines should be fluid–if you’re underachieving, your sales plan can help you figure out why and define the corrective steps you need to take.

Finally, follow a proven process for growing sales over time. While it would be fabulous to have Wal-Mart carry your product right out of the gate, it may not be realistic. Most large retailers want to see a track record of successful sales before agreeing to take on a new product.
Build Your Market
To learn how to bring a product to market, begin by selling directly to end-users. This’ll give you confidence that there’s demand for your product and will also create referenceable customers that you can contact for product and packaging feedback before you hit the bigger leagues. So where can you reach your end-users?

The web is one highly effective channel, and you can reach your market through your own website or via a site like eBay. You can also tap into your own personal network as you begin. Host a home party to share your product with friends and friends-of-friends, sell through local community groups and e-mail your network.

Once you get feedback directly from your customers, refine the packaging and price point before approaching your next market–wholesalers. You’ll probably start with small, independently owned, local stores. It’s a good idea to start with them before hitting larger chain stores because it’s easier to get in touch with the direct decision-maker, and they’re more inclined to take on new, unique or hard-to-find items to differentiate themselves from larger stores. To sell to these retailers, be prepared and bring a product sell sheet, photos, product samples (if possible) and a succinct introductory letter to explain what’s in it for them, highlighting your product’s profit margin, features and benefits, and proven sales record.

Expand to New Markets
Once you’ve established sales strength with independent retailers and are ready to support new markets, it’s time to sell to the big guns. Of course, exactly who those big guns are will depend on your product. For some, it’s powerhouse general mass retailers, like Wal-Mart and Target, while other products will fit more specialized but equally powerful retailers, like Williams-Sonoma, The Sharper Image and Sephora.

Note that when dealing with these major accounts, the sale is just the beginning of the deal. Handling fulfillment, returns, rollbacks, slotting fees, advertising and more will require strengthening your business’s infrastructure and resources.

But back to the sale. What’s the best way to approach a larger retailer? Here’s a quick cheat sheet:

  • Get the correct buyer: One of your biggest challenges is finding the right buyer within a large organization, so do your homework. If you’re experiencing roadblocks, consider hiring a distributor or manufacturer’s rep who already has established relationships in your industry.
  • Be prepared: Develop a presentation and have professional-looking sell sheets ready. Your product should also have packaging that’s ready to go.
  • Know your target: Understand what products they already carry and how yours will fit in. Don’t waste your time pitching to a retailer who’s unlikely to carry your product.
  • Take advantage of special programs: Some mass retailers, such as Wal-Mart, have local purchase programs that give managers authority to try local items. And other retailers may have different initiatives, such as minority business programs.
  • Be patient: It can take up to a year or longer before you see your product on store shelves, so don’t get frustrated. And if the final answer is no, try to turn it into a learning experience.

Finally, remember there are other sales channels besides the traditional brick-and-mortar retail store. Catalogs, TV shopping networks and online stores can also be excellent methods to enable you to learn how to market a product online.

Is Network Marketing Just a Scam?

Q: Some friends continue to try to recruit me into network marketing deals that seem like some type of money game or pyramid. Other friends tell me they’re illegal and I’ll get into trouble. How do I know what’s legal and legitimate?

A: To help you understand what network marketing is, I must first explain what it isn’t. First, network marketing isn’t a pyramid scheme. Pyramids are programs similar to chain letters where people just invest money based on the promise that other people will put in money that will filtrate back to them and somehow, they’ll get rich. A pyramid is strictly a money game and has no basis in real commerce. Normally, there’s no product involved at all, just money changing hands. Modern-day pyramids may have a product, but it’s clearly there just to disguise the money game.

Network marketing is a legitimate business. First, it’s based on providing people with real, legitimate products they need and want at a fair price. While some people do make a lot of money through network marketing, their financial benefit is always the result of their own dedicated efforts in building an organization that sells real products and services.

Pyramids are illegal and are based on taking advantage of people. For a person to actually make money in a pyramid scheme, someone else has to lose money. But in network marketing, each person can multiply his or her efforts, skills and talents by helping others be successful. Network marketing has proved itself as part of the new economy and a preferred way to do business here and around the world.

Network marketing isn’t about taking advantage of your friends and relatives. Only a few years ago, network marketing meant retailing to, and sponsoring people from, your “warm list” of prospects. Although sharing the products or services and the opportunity with people you know is still the basic foundation of the business, today we see more people using sophisticated marketing techniques such as the Internet, conference calling and other long-distance sponsoring techniques to extend their network across the country.

Network marketing isn’t a get-rich-quick scheme. Of course some people do make large amounts of money very quickly. Many would say those people are lucky. But success in networking isn’t based on luck. (Unfortunately, money won’t sprout wings and fly into your bank account no matter what someone has promised you.) Success in network marketing is based on following some very basic yet dynamic principles.

Now let’s discuss what network marketing is. Network marketing is a serious business for serious people. It’s a proven system where the design, creation and expense the corporate team has gone through becomes a road map for your own success. Just follow the simple, proven and duplicable system that the good companies provide.

The real key is this: Network marketing is all about leverage. You can leverage your time and increase the number of hours of work effort on which you can be paid by sponsoring other people and earning a small income on their efforts. J. Paul Getty, who created one of the world’s greatest fortunes, said “I would rather make 1 percent on the efforts of 100 people than 100 percent on my own efforts.” This very basic concept is the cornerstone of network marketing.

For example, most successful people building a network marketing business do so in an organized method. They work a few dedicated hours each week, with each hour of effort serving as a building block for their long-term business growth. Then they sponsor other people and teach those people how to sell the company product and sponsor others who duplicate the process.

By helping the people you personally sponsor to sponsor others, you duplicate yourself. As this process continues, you create compound growth that can lead to hundreds or even thousands of people coming into your business. You leverage your time by helping others be successful and earn an income from all their efforts.

With network marketing, there are no big capital requirements, no geographical limitations, no minimum quotas required and no special education or skills needed. Network marketing is a low-overhead, homebased business that can actually offer many of the tax advantages associated with owning your own business. Network marketing is a people-to-people business that can significantly expand your circle of friends. It’s a business that enables you to travel and have fun as well as enjoy the lifestyle that extra income can provide.

10 Questions to Ask When Collecting Customer Data

 

10 Questions to Ask When Collecting Customer Data

When your customers disclose their personal and financial information to you, they’re taking a leap of faith that you won’t lose, abuse or otherwise mess with it — accidentally or not. Your customers don’t want you to spam them every two minutes, hawk their info to third parties or, worse, expose it to cyber attackers.

Collecting customer data has been notoriously loaded with a tangle of privacy pitfalls. But when done right, the benefit to your bottom line could outweigh the risks. Leveraging customer data can lead to happier customers, reduced client churn and bigger profits.

Gathering sensitive customer information isn’t something business owners should just jump into and make up as they go. Get up to speed with these 10 essential questions to consider before you ask your customers anything:

1. I don’t have time to get anything from my customers but their money. Do I really need to collect data from them, too? 

Without customers, you wouldn’t be in business. Knowing who they are and what they want, particularly from you, can lead to more effective marketing, increased brand loyalty and the holy grail — more sales.

“Collecting customer data helps you know each customer more individually and treat them that way,” says Jeff Tanner, professor of marketing at Baylor University and director of the school’s “Business Collaboratory.” And the info you glean from them can empower you to “craft offers that increase purchase rates at higher margins while also delivering better value to the customers because they’re getting things they want,” he says.

2. What types of personal data should I collect and why?

Start with the basics, such as customer names and mailing and email addresses. These allow you to personalize your communications with them, directly market to them and follow up with them if there’s a problem with their order. Other data points to collect for an overall demographic snapshot are age, profession and gender.

As you develop trust with your customers, Tanner suggests going deeper and asking them for certain psychographic data points, like details about their personalities, values and lifestyles. For example, if you own a furniture store and find out your customer has children via a customer questionnaire, you might consider marketing children’s furniture to them.

3. What types of transactional data should I collect and why? 

Recording and analyzing each customer’s transaction history — what they purchase from you, when and how often — helps you know which products and services to offer them in the future. Companies like Amazon, and Zappos are some of the best at this powerful marketing practice, also known as “basket analysis,” automatically delivering sometimes impressively personalized product recommendations based on past purchases.

4. What are the best ways to collect customer data?

You can start by accumulating customer data every time they interact with your company — on the phone or in online chat with customer service, in-store with a salesperson or via online survey or contest, Tanner says.

It’s important to note, though, that the CAN-SPAM Act of 2003 prohibits procuring email addresses from certain online sources, including blogs and internet chat rooms, without the permission of site users and owners.

5. How should I organize and store it?

Once you obtain the customer data you want, dumping it into a basic Excel spreadsheet won’t do you much good. The best, most time- and cost-effective way to store, track and make sense of customer data, Tanner says, is to use an all-in-one customer relationship management (CRM) solution.

He suggests trying CRM packages for entrepreneurs from Pipeliner ($30 per month with a 30-day free trial), Zoho ($12 to $35 per month with a 15-day free trial) or Teradata (prices available by contacting Teradata sales).

6. How can I best protect my customers’ personal and financial data?

Encrypting all of your customers’ data is your first step in safeguarding it. This includes their names, email and physical addresses, credit card numbers, spending habits, social media logins and any other sensitive data points you’re privy to.

Best practices for data encryption vary from industry to industry. Here’s a guide to creating a strong cyber security plan for your small business, complete with expert encryption tips. You might consider hiring a data security specialist to take on the task for you.

If you hire a third-party to collect and store your customer data for you, be sure that they use the highest encryption standards available.

7. How can I be sure what I’m doing is legal?  

All that’s legally required of you when collecting customer data is to create a customer information privacy policy and give your customers access to it, Tanner says.

In an ideal world, your privacy policy should closely follow the Federal Trade Commission’s Fair Information Practice Principles, which are guidelines for securely collecting electronic consumer data, though they aren’t enforceable by law.

Clearly state in your policy exactly who is collecting which types of data, how it’s used and with whom you share it with (and if you intend to share it at all). You also have to allow your customers to opt out of receiving marketing material from you.

Specifically, if you own a business in the healthcare industry and gather patient information, you have to abide by Health Insurance Portability and Accountability Act (HIPPA) laws. Or, if your company’s target demographic is children and you interact with them online, compliance with the Children’s Online Privacy Protection Act (COPPA) is mandatory.

8. Should I sell my customer’s information to third-party marketers?

The choice is yours and plenty of companies do — and profit from it. But Tanner warns that doing so could alienate your customers. And they generally don’t come back once they’ve gone.

“If [business owners] use customer data like a mailing list, then they spam,” he says. “If they use data to have an intelligent conversation that includes relevant offers, then they become a preferred partner. You might be able to sell access to your customer list, but no customer will want to stay with you once they figure that out.”

If you decide to sell customer data to third parties, clearly say so in your privacy policy.

9. What’s the best way to benefit from the customer data I collect? 

Leveraging it to offer added value to your customer is the biggest advantage. Customer data helps you paint a clear picture of who your target customer is and how to best communicate with, advertise and market to them.

When you know your ideal customer better and really understand their needs and wants, you can better craft offers to entice them, which should in turn boost sales.

10. What are some common mistakes to avoid?

Perhaps the worst in the bunch, Tanner says, is asking for too much at one time and overwhelming your customers. Other common faux pas Tanner suggests steering clear of are not using the data at all and making assumptions about customers based on collecting transactional data only.

Improve Your SEO by Improving Your Links

 

Improve Your SEO by Improving Your Links
Image credit: Shutterstock
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In his book Ultimate Guide to Optimizing Your Website, SEO and online marketing expert Jon Rognerud shows you how to build a high-performance website and get top ranking on all search engines. In this edited excerpt, the author offers some tips on how you can improve your links by submitting your site to directories.

To get high search engine rankings, you should be providing quality inbound links to related, quality page contents. Make sure to always build links–the various types are discussed below–and the more you can get without spamming, the better. Use the competition in your niche to figure out which links are high-quality and where they link to and from. Studying the competition will help you get a higher ranking faster, and you won’t be doing it blindly. Make sure to also look at page structure, content, and so on.

Be sure to follow the top directories. Here are some to start with:

  • dmoz
  • Yahoo! Directory
  • Business.com
  • JoeAnt
  • Gimpsy
  • Best of the Web

Quality directories that include editors or fees are likely something to invest in. Many free sites are switching to paid submission only or have closed free submissions. The list above is simply a guideline to get you started. If a directory (and especially one you’ve never heard of) offers special incentives that seem spammy, don’t do it. Google has come down hard on the directory addition strategy for search. If you think it helps your audience and is relevant within the directory, it may warrant a deeper look. The results in Google will show a slightly different display after installing the SEO for Firefox plugin. You may see listings that have a lower page rank but is shown before a page rank 6, for example. It’s important to know that other metrics, like overall traffic, user behavior, domain age, recent cache date, total links to site and individual pages, help weigh the ordering of results.

Some paid directories are created not only to make money for their creators but also to provide a firewall to protect them from spam. Google and others also value these directories as providing better-quality links, and if you can afford it, it’s wise to belong to them.

Quality directory links can be good for your traffic and ranking, and strongly elevate your brand. The assumption is, if somebody has the money and is willing to pay, then it’s not likely a spammy site. Some of these sites insist on you using company names, not keywords, but don’t try to trick the system. You can establish unique domains with keywords to it with a redirect, but it’s considered tricking the system. Better to do it right.

In your marketing efforts, it’s important to take advantage of the social web to build links and your brand. The list below is by no means comprehensive, but it offers a sample of social media sites to consider in your marketing efforts:

  • delicious.com
  • Digg
  • Facebook
  • Flickr
  • 43Things
  • LinkedIn
  • MySpace (still)
  • Newsvine
  • Ning
  • Reddit
  • Squidoo
  • StumbleUpon
  • Technorati
  • Twitter
  • Wetpaint
  • WikiHow
  • Wikipedia
  • Yahoo! Answers
  • YouTube

Yahoo! is one of the most complicated. Go to yahoo.com, select the “More Y! Sites” link, then click on the “All Products” link. You’ll see everything in the Yahoo! world. Then select the “Directory” option. You’re now in the directory (dir.yahoo.com).

To locate the best place for you to list in the directory:

  1. Locate a competitor, and type in their name.
  2. Click on it, and you’ll see the breadcrumbs link to where it’s located.

Yahoo! search has nothing to do with the directory. You have to enter the directory to see your listing. Think in terms of alphabetical listings. If you’re deeply nested in the tree, it may not be the best place for you. Once you’ve typed in the competitor’s name and found your place, click “Suggest a Link” to sign up for Yahoo!. Directory submission is $299 annually and does not guarantee inclusion. Your next step is to accept the terms of service–print, read and understand them.

Once you’re in, there are four steps to update your listing:

  1. Understand the cost.
  2. Submit the site. You don’t need to get the keywords in each link, don’t sell in the description and be factual–no sales pitch. Look at some existing listings for examples of what to do.
  3. Submit your credit card info, such as your Visa/MasterCard and billing address.
  4. Submit the actual content via a review and confirm.

Wait at least seven business days for a response–it’s not immediate. Don’t forget that many people do a local search for businesses and services in their area. You should also build local and regional links from sites such as Yahoo! Local and Google Local, and through local organizations such as your chamber of commerce.

Is Your Marketing Message Getting Muddled?

When it comes to formulating your marketing message, it is imperative to be clear, concise and thoughtful to make the largest impact. If you sway the other way by providing too much information in a complicated manner, your message may get lost.

For instance, in “When Three Charms but Four Alarms: Identifying the Optimal Number of Claims in Persuasion Settings,” authors Kurt A. Carlson and Suzanne B. Shu suggest marketing messages with more than three claims trigger consumer skepticism and disbelief.

This statement can also be bolstered by the fact that having too many claims (or options) can confuse people, resulting in consumers just giving up and walking away.

Daniel McFadden, an economist at the University of California, Berkeley, told The Economist that consumers find myriad options disturbing because of the “risk of misperception and miscalculation, of misunderstanding the available alternatives, of misreading one’s own tastes, of yielding to a moment’s whim and regretting it afterwards.” This combined with “the stress of information acquisition” can result in what is known as shopper’s paralysis, a situation where consumers find the decision too difficult to decide and therefore buy nothing.

To make sure your message doesn’t get lost in the shuffle, keep these tips in mind:

Pick three attributes. What are the most important strengths or stand out qualities of your product? Make a list, whittle it down to the three essential or most compelling ones and have these be the consistent centerpiece of your messaging.

For example, Wells Fargo’s message emphasizes experience, ethics and forward movement.  While it offers many technological benefits, including online banking and smart phone apps, those are not the prominent features it markets. Instead, they choose to focus on timeless qualities to maintain its base and lure consumers who may be weary — and leery — of trendier banking campaigns and promises.

Another example is J.C. Penney. One reason for the retailer’s downturn was they tried to send too many messages to their core customer.  For instance, the store’s new home department was supposed to bring in customers who could help lift it out of a financial death spiral, but instead valuable selling space filled with home goods from high-end names like Jonathan Adler, Michael Graves and Sir Terence Conran sat empty.  These high-end furniture items weren’t cohesive with its other focuses: family friendly, great prices and affordable brand names. With too many messages, the consumers got confused and gave up.

Don’t disappoint: You’re counting on three ideas to capture your audience’s attention.  Not only should they be forceful, easy to understand and beneficial but also true.  You want your satisfied customers to tell their friends or colleagues, “It really works” or “It’s a really good product.”

The Kindle Fire HDX is another story. It was one of the most successful products of 2013, as it provided users a desired level of media to consumer, at a low price and in a beautiful format. And all it claims happens to be true, at least according to numerous tech reviewers and consumers. No disappointment there.

On the flip side, the opposite reaction can do serious damage to a business — and sometimes it’s permanent.  Many business pundits predicted the fall of Suzuki, and indeed, in January they announced they would stop selling cars in the US. One reason is they lost share to other car manufacturers who have plenty of low cost fuel-efficient vehicles that compete with Susuki’s lower-end or relatively inexpensive cars

Another reason? Suzuki has trouble selling cars because its reputation among drivers doesn’t compare to the company’s reliability message.  A 2012 J.D. Power survey of car dependability in the U.S. put Suzuki’s scores for power trains, body and materials, features and accessories below almost every other brand — foreign and domestic.