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The Need for Promotion

You’ve experienced your business “light bulb” idea for a terrific new product or service. You’ve organized an office complete with desk, phone, and computer, and you may possibly even have a small storefront or service vehicle. By all accounts, you are in business. Now ask yourself this: Does your target market know you exist?

In order for customers to purchase your goods and services, you must first go to them. You need to advertise and actively promote your business before you can expect inquiries into what you have to offer. While there are a handful of promotional means that are standard for all business ventures, entrepreneurs’ limit to promotions is their own creativity.

Unless you know enough customers to keep you in business from the day you open up, you need to gain customers. To some extent, that is a game of numbers. To get people to buy what you are offering, you first need to make an impression on them, letting them know who you are and what you are offering. Those who have some interest become your sales leads and the most interested ones become your prospects for a sale. So at a fundamental level, promotion drives sales. How many prospects? Marketers talk about the marketing funnel, a rule of thumb about how many prospective customers it takes to find one who will actually make a purchase. For mass market and Internet advertising, the typical ratio is 1000 to 1.

Promotion is essential to gaining the attention of people in the general audience, and any- thing you can do to improve your marketing will improve your chances of making a sale. The funnel provides some insights into recognizing what is truly important in the marketing process. For this funnel, every customer you keep saves you from having to contact 1,000 new people in the general audience to find a replacement customer—so improving customer loyalty is tremendously important. We will talk about loyalty and other postsale issues later in this chapter.

The funnel illustrates selling to the general public, but what if you could target people you al- ready know have a reason to be interested in your goods or services? Maybe one or two people in a thousand would buy a baseball glove, but what if you could target people playing baseball? Instead of two sales per thousand, with qualified leads like people already playing baseball, you might be able to sell 10 times as many gloves, or more.

Following Figure 10.1, in this chapter we will talk about defining your target market and deter- mining how to identify segments like those already playing baseball. We then discuss the methods of promotion including social media, public relations, and press relations. We conclude the chapter with a discussion of personal selling, and managing postsale relations in order to retain as many customers as you can. But first, as is true in so much of entrepreneurship, it all starts with you, your ideas for your business, and its goods or services. Because all promotion is about the value you can provide your customer.

The Basics: Crafting Your Value Proposition

Chapter 7 introduced the idea of value and cost benefit. This was further developed by talking about your total product in Chapter 9. As you recall, your total product is not just the bare bones object or service you provide, but what it means to your customers. You don’t just do a great job cleaning houses; you provide free time to your customers. You don’t just sell desks; you handcraft beautiful and functional desks in exotic woods. You can talk about your competitive edge—what you do bet- ter than your competition—or your distinctive competency—what you do that no one else does, but what it all boils down to is your value proposition.2

Youcanthinkofdefiningyourvaluepropositionalongthesamecategoriesofvalueandcostben- efits of quality, style, delivery, service, technology, shopping ease, place, and scale and scope. For eachofthecategoriesmentionedinChapter7,thinkabouthowyourcompany,product,orserviceis differentfromanyoneelse’s.Undereachcategory,answerafewquestionsasobjectivelyasyoucan:

?   Why would someone want your product or service? What need does it fill? List the benefits and the problems it solves. In what way does it improve the life of the user?

? Would you personally buy this product? Why or why not? The “why nots” may give you an insight into potential weaknesses or categories of differentiation that you need to work on.

From there, you can then start to determine who will most benefit from your product or service. Begin with these questions:

? Who, in your opinion, is most likely to buy it? Be as specific as you can. How old are they? Male or female? Where do they live? Where do they work? These people are your primary target market. It doesn’t mean that you don’t have second-or third-tier markets.

? How does your primary target market currently go about buying existing products or services of this type? What are its sources of information? Word-of-mouth? Trade publications? Yellow Pages? The Internet?3

By answering these questions, you can start to further develop the value of your product and ways you can find and communicate with your customers. Once you know who needs your product or service, you can begin to craft your value and message directly to where your market would look to find information related to your small business. Skill Module 10.1 will help you develop a value proposition.

Segmenting Your Market

Many entrepreneurs have trouble answering the question, “Who is your target market?” Most en- trepreneurs assume that everyone is their target market. Why should an entrepreneur care who buys their product, as long as it’s sold? If pressed, the entrepreneurs can usually tell you who is most likely to buy their product or service and why. When they can tell you this, they have targeted their market. Although targeting and market segmentation are more fully discussed in Chapter 12, there are some concepts that are important to know in order to understand promotion.

Segmentation is the process of dividing the market into smaller portions of people who have certain common characteristics. Your target market is the segment or segments you select on which to concentrate your marketing efforts. A marketer can chose more than one target market, but it is customary for a smaller business to concentrate its efforts on one target market at the beginning and consider secondary ones later. Marketers use information on the target market’s wants and needs in order to tailor the product or service, as well as its price, distribution, and promotion.4

Dividing the market into different segments can be done in a number of ways. Some of the more typical ways include geographically (in a certain city or neighborhood), demographically (income, age, religion, ethnicity, and many others), or by the benefits sought (clothing that is practical, styl- ish, for a particular sport, etc.). Most companies will use several ways of segmenting to come up with their final target market. For example, the Beacon Street Girls products were segmented by gender (girls) and age (9–13). In addition, the fact that they were into values and community service would be a form of benefit segmentation. Beacon Street Girls also had primary and secondary target markets—the girls and their parents and other gift givers.

Let’s start with an example: you run a day care center. Who is your market? For starters, it is small children, or at least, the parents of small children. You have segmented by life cycle position; that is, you have eliminated children, teenagers, senior citizens, and parents of older children. But this really does not eliminate very many potential customers. How else could you limit your poten- tial customers? Driving distance, say 15 miles, is a popular limit since parents are unlikely to want to drive too far. Income, or disposable income, is also a key segmentation device. Families need to be rich enough to afford your service but not so rich as to hire nannies. Other segmentation ideas include schedule (parents who work evenings and nights) or children’s hobbies (e.g., offering soccer or music lessons). The more accurately you define your segment, the closer you come to defining your target market.

Using our example from above, let’s say that you are located in a town with a large Hispanic population (Phoenix) and all of your day care workers are fluent in Spanish. Your day care center is located in a middle-class, Hispanic area where most households are dual income parents with several children. Your research has shown only a couple of nearby competitors and none of them have the bilingual staff that you have. This opens up the opportunity for the business approach you have in mind, targeting a bilingual day care center for the Hispanic parents needing day care. A potential secondary market might be non-Hispanic families who desire their children to be fluent in Spanish—a market that could be considered at another time.

With the target market defined, it becomes easier to determine what information customers need in order to make a decision to buy your service. The Juarez family (as we imagine our typical cus- tomer) needs to find a day care center for little Tomas, who speaks a mix of English and Spanish. Good news! At your center he is not likely to be misunderstood. Other benefits include being able to leave instructions in English or Spanish or having children get a mix of both cultures, such as holi- day and birthday celebrations, stories that are read, decorating colors, the day care center’s name, and such. These are things that an entrepreneur could use to make this day care center “perfect” for a bilingual clientele.

Promotion includes getting the message out to the target market so that they can make decisions about your product or service. When advertising, your day care center will want to mention the lan- guage abilities and other benefits likely to be important to the target market. In order to catch the eye of the audience, the advertising might make use of Hispanic music, a Hispanic model/spokesperson, or symbols that will resonate with the Hispanic culture. (In the Phoenix area, perhaps a Mexican flag would work well.) It is likely to run ads in Spanish or at least partially in Spanish. It is also likely useful to use local Spanish television, radio, or newspapers depending on its budget and the ability of these media to reach the target market. Your day care center may send out mailers in the local area and other predominately Hispanic neighborhoods.5 Parents who visit the day care center would likely hear a sales pitch that was directed to cares and concerns of this target market.

Consider, for a moment, promotion for the secondary market mentioned earlier: the non-Hispanic parents that wanted their children to be fluent in Spanish. Now the ads are likely to be in English. They are likely to run in different media. Mailings would go out to other areas. The sales pitch that the prospective parents would hear would likely be much different.

So how do you do this for your particular product or service? First of all, consider where your target market gets the information they need to make purchasing decisions. Is it the Internet? From their friends? From magazines such as Consumer Reports? From television or radio ads? From talking to the clerks at the stores? Or is your product something they will buy without much prior thought processes—an impulse purchase. These all have implications on where you will put your message in order to make sure they see it.6

Secondly, what features about your product or service are important to your target market? That is, what is it they are looking for when considering buying this product or service? Is it cost? Reli- ability? Technology? Appearance? Fitting in with their peer group? Convenient location? How do what the customers deem important fit in with your product or service? (If your customers are motivated by price and your product’s distinction is style, technology, or other factors that increase price, maybe you have the wrong target market—or the wrong product for that market.) Knowing what the customer wants will help you determine what to say about your product or service. If you really aren’t sure about where they get their information or what they want, try checking out your competitors’ ads—your successful competitors, that is. While you’ll want to be different in your message content, you can get a lot of hints from what is already working.7

Next, what will get your target market to pay attention to your message? Are you going to use rap music or classical music? Will the people in your message be wearing grunge or high fashion, business professional or jeans and a T-shirt? Will you use bold colors and exotic fonts, or will you use understated elegance? One of the major mistakes an entrepreneur can make is to choose an ap- pealing (to them) message or media, instead of picking one which matches the demographics—and tastes—of the target market.8

The answers to these questions are determined by a person’s age, gender, ethnicity, education, income level, profession, geographic region, personality, and a myriad of other factors. This is what makes defining your target market accurately so important. While many entrepreneurs have dif- ficulty selecting only one target market, it is nearly impossible to design a message that will appeal universally or to find media that will reach all consumers. These rather generic messages often end up appealing to nearly no one and can be a considerable waste of marketing dollars.

A word of caution: unless you are particularly artistic, do not create your own promotional pieces. It is quite acceptable to sketch out concepts, suggest colors, symbols, and other features and to retain final approval, but expect to spend a little money getting professional artistic help. A graphic artist is well worth the investment. If you have an exceptionally tight budget, consider asking a graphic design department at a local university to use you as a class project or for a student who is willing to do the work for minimal cost and a chance to include the results in his or her portfolio.9

Once you have a clear idea of who your target customer is, a world of data is available to help you think about their habits. Many of the large marketing firms offer information on predetermined market segments based on their own unique approaches. Nielsen, a company you probably recall is famous for television ratings, has several types of segmentation analyses. The one that fits for most consumer-oriented firms is called Prizm (www.MyBestSegments.com). For nearly any zip code in the United States, Prizm can tell you the predominant groups in it.

For the day care center, our entrepreneur defined the target market based on personal contacts, discussions, and first-hand research. With the target market defined and the likely areas (specifically zip codes) identified, it is possible to supplement the personal work with information on predeter- mined market segments. Prizm, for example, will identify the five largest market segments within a specific zip code for free. For each segment, Prizm provides a free, detailed, rundown about the buying habits and demographics of this group. For the day care center, one of the likely zip codes is 85008. In that zip code the Prizm segment “New Beginnings” is one of the top five. The information on the segment is shown on this page.

The information in these predetermined market segments can help you identify the financial and shopping characteristics of the group, which can be difficult questions to ask people face to face. These segments can also be a useful check on your own analyses of your target market.

Competitors to Prizm include Esri’s Tapestry model (www.esri.com/data/esri_data/tapestry .html) and Strategic Business Insights’ VALS survey (www.strategicbusinessinsights.com/vals/). Each provides descriptions of their segments, as well as the opportunity to see some data for free by

zip code. Additional data requires a fee. If you want to know the general characteristics of particu- lar zip codes without the addition segmentation analysis, you can use any of the new crop of free zip code data sites, like www.zipwho.com, www.censusscope.org, www.zipskinny.com, or www .city-data.com, the use of which are shown in Skill Module 11.2. There is also a mountain of free data available at www.census.gov for areas, businesses, and households.

Why don’t we recommend using these carefully crafted segments first? Because the essential strength of small business owners is that they are close to their customers. Good entrepreneurs under- stand their customers and their needs at a personal level. It actually hurts your ability to define your own target market if you first rely on some other group’s or firm’s idea of who the target audiences are. The only certain way for you to know your customers is to start looking for them personally, finding out what they are like personally, and hearing what they have to say personally. Then you have a basis for deciding if and how these predetermined market segments fit any of your real cus- tomers. If they do, then these commercial products can help you know more about your customers, but they can never really replace the knowledge you first build about your customers on your own.

Crafting Your Message

American consumers are bombarded by messages all day, for example, a Yankelovich Advertising Agency study reported the average person was exposed to 5,000 ad messages a day.10 However, many of us screen out most of the commercials we see or hear. Even when an advertisement catches our eye, we are likely to spend only a few seconds at most considering it unless it is of special importance to us. For example, if you are in the new car market, the car advertisements suddenly become more visible to you, but even when you are interested and move down the marketing funnel from having an impres- sion to becoming a sales lead, you may have a poor recall of any ads you’ve seen. Was it the funny ad or the one with the special effects? Ad recall is a major problem for all advertisers.

The bottom line consists of two questions: How can you get the attention of your potential cus- tomer? If a potential customer sees or hears your message and walks away with only one thought about your firm, your product, or your service, what do you want that to be?

The how has been addressed somewhat by thoroughly investigating your target market and find- ing out what they like. This will give us a good idea of where they are likely to be exposed to our messages. This will also give us a good idea of how our messages should be designed.11 So if you did a good job on the target market analysis introduced earlier, you should know where they look and what they want. That leaves crafting a message that fits their needs.

Figure your goal is to craft one message for your target market. It should be specific to them and appealing to them. You should plan to repeat it, because a message repeated is more often the message recalled. You should also make sure the message is clear. There have been famous com- mercials (like one for Rozerem sleeping pill) where people remembered the commercial (with Abe Lincoln and a talking beaver), but had little recall about the product.

The message you craft should combine the elements of your product or service’s value proposi- tion with the needs of your target customer. If they want speed, you should stress speed in your message. Once you have that key element, what can you do in the message to reinforce, repeat, or otherwise support it? Red is the color of speed, for example, and a fast-paced radio, television, or web ad can also support the impression of speed.

In general, you can structure messages to be similar to the target customers or distinctive. Ads with a similar approach use average-looking people. Ads seeking to be distinctive may opt for mod- els. This is where understanding what your target audience likes is important.

Along the same lines, you need to decide the voice or tone of your message. Tones or voices include humor, fear, patriotism, collegiality, sex, romance, love, and nearly every other emotion. Some, of course, will work better than others, often depending on your product. Humor may de- grade into slapstick (okay for some audiences, but not all); romance or love may become sappy. Medications, insurance, safe cars, security products, mouthwashes, and breath mints may be fine for fear appeals, but they may be tough for other products. Be careful of being too strong. A fear appeal that is too strong may cause the audience to react negatively.

Will your ad show a real-life situation (think ads for paper towels) or will you exaggerate (the less- than-average guy with the super-model girlfriend), use fantasy or cartoons? Will you demonstrate

your product or compare it to competition? If you compare, will it be overt (We are better than Company A) or not (We are the best)? Will you use rational arguments about the size and speed?

The answers to these questions vary based on product/service and target market; there are not al- ways hard and fast rules. Car commercials, for example, range from the excitement of the speeding car on the curving road to rational appeals about miles per gallon and other features of the automo- bile. They use comparisons to others, humor, sex, fear (safety), and feel-good family themes.

Effective messages are succinct messages that will make your business clear to potential clients and customers. You will use more general messages to convey your firm’s overall image.

A great example is Mary Kay’s slogan “Enriching women’s lives.” If used consistently, these mes- sages will ensure the development of a solid business identity.

To start initially, you can use your value propositions for each identified market to help you develop your overall message or slogan. Try to think of three to five key words that would describe your business to anyone. What words capture the essence of what you do and why you exist?

Specific marketing messages use the same principle: What is the key idea I want the potential consumer to leave with? Sometimes these messages are pretty straightforward like “We are having a sale on May 24 through May 26.” Others may take more time to craft your value proposition or other distinct features of your product in a form that will resonate with your target audience. Start out with a strong first mental image—the first thing your client will see in his or her mind when exposed to your message. Avoid overworked verbs; use action wherever you can but pick unexpected words. Saying “We beat the competition” is fine, but how much more interesting is “We wallop the competition”—and even adds a bit of alliteration as well.12

Conveying Your Message

The challenge of conveying your message is knowing that your intended customer has actually heard or seen it. If you are selling face to face, you can be more sure that you and your message are connecting, but when you send out a press kit or have an ad printed in a newspaper, it is harder to know. One of the interesting aspects of Internet advertising is that it provides a somewhat more detailed understanding of who looked at a page, and if a viewer clicks on an ad, you can learn a lot about the potential customer. However, away from the Internet, it is hard to be as sure.

Traditionally marketers think in terms of five types of avenues for getting your message out: advertising, sales promotions, public/press relations, and personal selling that will be covered in this chapter, while direct marketing, will be covered in Chapter 11 as part of distribution. The promotional mix essentially describes how much of each of these five approaches you will use. The key to promotion for you as the entrepreneur is deciding on the promotional mix that works best to meet your needs and your budget.

Advertising

Advertising is the major way most businesses convey their message to potential customers. Adver- tising is the presentation of your company’s image, products, and services to potential customers and the general public. It can be done in print outlets, or electronically via mass media or the Inter- net, or via signs from business cards to billboards to aerial banners. The goal for any advertising is to give customers and the general public a positive impression that they will associate with you, your firm, and its products. If the impression is positive but they don’t recall who you are, the advertising did not work. If they recall who you are, but the ads didn’t make the viewer feel more positive about you, the ad didn’t work.

Because of the Internet, today’s entrepreneurs have never had so many ways to promote their businesses. Traditional media like advertisements in magazines and on billboards can now appear all over web pages. Commercials on TV can also appear on the web. Door hangers with your coupon can be supplemented with local campaigns on Groupon or with Google Local to focus on particular cities or even neighborhoods. There are more places to put the name of your firm or product than ever before—from every square inch of a NASCAR racer’s uniform, to the poles of turnstiles at the amusement park, to pop-ups inside of your YouTube video. Table 10.1 gives you an overview of the many forms of promotion available to you.

As you can imagine, given the enormous number of ways to advertise, it is impossible to give you detailed information on the ins and outs of each type of advertising technique. In fact there are semester-long courses in advertising in most business programs, with whole textbooks going through the many forms. You can get a lot of information online from reputable sources such as www.entrepreneur.com, www.inc.com, www.itsyourbiz.com, www.mashable.com, and www .ducttapemarketing.com. What we can do here is help get you started in advertising your busi- ness. So we will talk about the first steps you take—those you need to pay for and those you can do for free.

Paid Advertising

The first thing you need to do when starting your business is to establish your company identity. While some elements are free, others will take some money up front. Exhibit 10.1 gives you a list- ing of the key elements of creating your corporate identity. Central to the identity is picking your company name, which we discussed in Chapter 9.

You will want a name for which you can get a matching domain name. That domain name is necessary to get your own website, and most websites with domain names also give you the ability to get an e-mail address with your company’s domain name. You can check if prospective names are available at any online firm selling hosting packages or domain names, but if you find that a name

you like is available, plan to buy it that day. There are firms paying each day to see what names were looked for, and they buy the names up for the purpose of reselling them. Search for cheap domains to find low-cost vendors. Many web-hosting companies will give you the domain name free with a web-hosting package. Unless you’re planning to do e-commerce from day one, you can open up a “starter” type website (usually around five pages) for a low fee and upgrade as you get an idea of what your business really needs.

Armed with these you can start making business cards, and then websites and brochures (the print equivalent of your website). If you think a professional-looking logo would help, there are free do-it-yourself sites like www.logomaker.com or www.logosnap.com, or you can post for proposed logos on a site like www.elance.com and offer a price ($25 is typical) for the logo you select. Most marketing and web design firms can help you in this area as well.

Although regular phone service is not free, you need it, and you need the number to include on your business card and website. Think about getting a number that reflects your business—one tile company snagged a phone number they could display as 555-868-TILE (8453). One free service to consider is Google Voice, which will let you program one number to ring in multiple places or across multiple phones. With these basics in place, you can get down to the serious business of ad- vertising your product and service offerings.

From your prior workups of value proposition, target market, and market segmentation, you should have a clear idea of your intended audience. You should have some idea of where they get their information—from TV, radio, newspapers, magazines, direct advertising like mail, or the Internet—and how much they use and trust each of these vehicles. From this, you can begin to think about how to structure your mix as soon as you add one more item—price!

Advertising costs are usually based on cost per thousand (CPM—the M is the Latin mille or thousand). Figure 10.2 shows you CPMs for a number of different forms of paid advertising. What the chart doesn’t show, but you need to keep in mind, is that one ad impression is unlikely to do the job. Marketers talk about needing 15 to 20 impressions for people in the general audience to notice and remember who you are. This is why you will notice that commercials are repeated so often on TV and radio. The companies are trying to get enough impressions to you so that you recall their product. Taking a look at the graphic; knowing the underlying need for ad repetitions, you can quickly see that major advertising campaigns using traditional media are problematic for small businesses— they are just too costly for most start-ups. How can you build an advertising campaign on a limited budget?

For companies whose products have a regional, national, or global audience, there is no real competition to the Internet. Ads bought on the major services like Google, Bing, and Yahoo can be seen by millions around the world every hour. But because Internet ads depend on how often they get shown, you will want to limit who sees the ad to people in particular localities, or people who have searched for a term linked to your product, or people online on certain days or times of day. You will be able to check how many people react to the ad by their click-through rate, the frequency with which they click your ad for more information or to buy the product. You can also test multiple forms of the ad in a day, and adjust the ad as you learn what works best with your target audience.

But as great as web-based advertising is, it is only worthwhile if your intended target audience is on the Internet on sites where you can advertise to them. The story of AO Rafting in the Small Business Insight box shows a powerful way to leverage the web. For our day care center in Phoenix, we could limit online ads to people in Phoenix who search for terms like day care. Services like Google Adwords Express let you focus your paid ads in a relatively small geographic area. Ser- vices like Valpak and competing local coupon mailing or door-hanging services offer a similar service using traditional print media. For our day care center, we could use Google Adwords for people searching for “day care” or “child care” in the local area and supplement that with mailed coupons in areas of town we know have families with children. We could then supplement these with the free techniques discussed below. We also could check locally for neighborhood newspa- pers where we might place ads, as well as church and school newsletters, which tend to be very low cost.

When you think about spending money to buy advertising space, especially when we are talking about traditional media like TV, radio, and print, it can make a lot of sense to also allocate some money to have advertising professionals prepare your ads. There are small advertising and market- ing agencies virtually everywhere (and if you are comfortable working with an online ad agency, they literally could be virtually everywhere). Most good ones will show you a portfolio of their work, and hopefully you can check them out with their other clients. Most will also give you a cost estimate to help you determine quickly if you can afford them.

This can also apply to your Internet ads, especially if you are planning to develop videos or want interactive websites with state-of-the art graphics, or if having a styl- ish site is central to the image you want your firm to project. Otherwise, many people using the Internet seem to prefer the less professional ads that give you the sense of a personal connection to the entrepreneur at some other computer on the World Wide Web. On the other hand, you may want to hire some professional help in order to make your website appear high up on search results, through the techniques of search engine optimization (SEO). Identifying the best keywords and descrip- tion tags to your web pages can be extremely useful, especially if you are new to the intricacies of the World Wide Web.

Free Advertising

There has always been free advertising. It probably started with entrepreneurs telling their friends about the business while working their “day jobs,” or people calling out what they had available in the marketplace, or putting up a self-made sign showing what they were selling. Every one of those forms of free advertising remains very much in force and they still work! But today there is more—a lot more.

For our Phoenix day care center, we already have talked about paid advertis- ing. There are several free ways to get the word out. Posting brochures or business cards on the bulletin boards of supermarkets and pharmacies or other stores in the targeted neighborhoods is one way. Passing out brochures or flyers in local areas or at meetings (e.g., PTO) is very inexpensive, but make sure you get permission first! Think about places families might go and pass out cards and brochures there—think

of parks and playgrounds on weekends, for example. The idea is to think, “Where does my target market go?” and be there to advertise your business. We could look for local bloggers on family topics and send materials about our new day care center to them in hope of getting a mention on the blog. In other words, wherever we can get the word out, we do it. This kind of thinking will be used when building press and public relations programs later in the chapter.

We can make free websites for our business on Facebook (useful if you sell to consumers), LinkedIn.com (useful if you sell primarily to businesses), and Twitter (popular with both groups). These sites give you ways to get involved with customers and with groups as part of an online social exchange, making them feel more connected to your firm. On all three websites, there are groups of people with shared interests, and there is also sharing with the members’ network connections. So if a customer of yours “Likes” your Facebook page, all of their Facebook connections will see that, which can explosively add to your growth. Typically these social networking websites are linked back to our main website, so that customers can easily use all your web resources.

While these sites are free and interactive, giving you a way to exchange ideas and opinions with one another, if you are going to be serious about using these free networks, you need to be consistent about living up to your social obligations. Checking Facebook, LinkedIn, or Twitter every 24 to 48 hours is necessary, and you need to not only check what is happening, but to keep the site’s content fresh, with new postings at least a couple of times a week. A dormant Facebook or Twitter account actually hurts your business reputation because it seems like you don’t care.

The other opportunity that opens up with these social network driven sites is the possibility of buzz or viral marketing. You or one of your customers on your Facebook or Twitter account may post a message, upload a picture or a video that people start sharing, and the sharing becomes explosive, withthousandsorevenmillionsofpeopleseeingandsharingthematerial.Havingsomething“go viral” is not easily done. Some say that it can only occur naturally. But you could get a small-scale virus going. For example, imagine our day care center owner posts on her Facebook page a short video on “How to get your child ready for his or her first day at day care.” The customers on the Facebook page like it enough to pass it on to their friends, who pass it on, and suddenly a reporter at the local TV station sees it and asks the owner for an interview. In the interview, the reporter men- tions the video and links to it from the TV station’s website. Suddenly the owner is the top day care expert in Phoenix. Think about that when you see the local news. There are stories like this happening every few days. The two major sources for these are viral marketing and press relation efforts.

Getting other people to talk about you and your business is one of the best ways to get potential customers’ attention. Since the days of newspapers, this has been called free ink because getting the local gossip columnist to mention your restaurant got your name in ink but didn’t cost you hard dollars (although it might have meant the gossip columnist got a free meal from you). Today there are more ways than ever to get free ink, and it goes far beyond newspapers.

Again the Internet is a major player. For example, NM Incite reported the existence more than 186 million blogs worldwide at the end of 2011.15 There are even blogs like Squidoo (www.squidoo .com/sumbit-startup) or KillerStartups.com that are focused on spotlighting new start-ups.16 With that many blogs, there are bloggers focused on every topic, locality, and industry. There are even directories of blogs, search for blog directory on Google or Bing to help narrow your search.

Whether you are seeking free ink from traditional media or the Internet, you have to do your part, mainly providing them with information ready to be used. For example, Internet marketer Kipp Bodnar17 suggests blog-ready materials might include answering customers questions, aggregating an interpreting industry statistics, or making lists or charts the blogger can quickly incorporate in their next posting. We’ll get more into the details of press releases in the section on press relations later in the chapter.

If you can get the bloggers to like your product or service, they are more likely to mention it. Sending them your press release might work if it is relevant, but a sample of your product might be better. Do some research on the sites to decide which to target. For example, there is Coolhunting for urban living products, Kevin Kelly’s CoolTools for tools and gizmos of all sorts, DailyCandy for fashionable clothing, Gizmodo for electronics, Luxist for luxury items, MoCoLoco for modern furniture, and Treehugger for environmentally friendly products.18

The whole idea of connecting businesses to blogs has itself spawned entrepreneurship oppor- tunities. PayPerPost—which is blog focused but not free—is a firm that connects firms hoping to be featured on blogs with bloggers who don’t mind some extra cash for mentioning their products. The company’s founder counters implications that this is unethical by stating that the firm doesn’t specify whether the content needs to be positive or not; in other words, you can even get paid for complaining about a product or service.19

Another of the original forms of free advertising is word-of-mouth (WOM) advertising because it is passed when one person speaks to another about a product or service they like, or when the entrepreneur makes a personal pitch about their business to someone they just met.

When it comes to promoting a small business that is just starting out, spreading the news by word-of-mouth remains one of the surest ways to build a client base. Whether a potential customer meets the owner directly or hears of the business secondhand, a connectedness is established that cannot be matched by advertising or other marketing methods. Entrepreneurs should make use of every opportunity to meet potential clients and expose them to their products or services.

Network advertising includes referrals as discussed in Chapter 9, but also the information you spread through your own network of family, friends, and business associates, who are described in the social networking discussion of Chapter 3. Ask those clients you’ve satisfied to pass your name along. If possible, give them an incentive—a discount on their next purchase, for example—to do so. Another example is by passing out your business card at every opportunity. (You may even want to print special ones offering the carrier to some token gift—an advertising novelty, perhaps—a free estimate, sample, or discount when they visit your business.)

While a business card goes a long way, prepare yourself to sell your business at every oppor- tunity. Join local groups such as Rotary or Toastmasters. Get involved with trade associations, chambers of commerce, or even local government. If you are able, offer to speak at organizations; perhaps you can share some of your funniest start-up stories and the lessons you learned.21

If you ask most service providers how they get business, the answer is usually referrals or word- of-mouth.22 Carter Prescott, head of New York-based Carter Communications, which provides high-level writing and speaking services for Fortune 500 clients, doesn’t even have a listed phone number. “I’ve never needed one,” she says. “It’s better to have people call you on their own, rather than soliciting calls anyway. You get a better client that way.” She only gets calls when a current client gives her number to a potential client.

One cold call to a dealer can start word-of-mouth advertising23 and get your product into stores. Lynn Gordon, proprietor of French Meadow Bakery in Minneapolis, Minnesota, started her bread- making business in her kitchen, producing 40 loaves a week for local co-ops. One day she made a cold call to a local gourmet shop, which started a word-of-mouth snowball. As luck would have it, the buyer was on a special diet, and Gordon’s bread was just what she was looking for. Soon other grocery stores signed up. Meanwhile, customers sent loaves to friends around the country, who called to order more.

Under pressure from stores, distributors started asking for French Meadow bread. Next, Diane Sawyer and the 60 Minutes crew showed up to do a story about the Women’s Economic Development Corp., a program for women entrepreneurs in which Gordon was involved. Saw- yer highlighted Gordon and her gourmet bread on the show. Then the state helped subsidize a trip to the International Fancy Food & Confection Show in Chicago, where 300 stores placed orders. Will Steger, the tundra explorer, ordered Gordon’s bread for the international trip he was leading across the Antarctic. Even Neiman Marcus bought French Meadow bread to in- clude in a $5,000 Ultimate Cocktail Buffet. As a result of that first cold call, Gordon moved her operation into a 13,500-square-foot storefront bakery in Minneapolis, where she eventually employed 15 people.

Another effective way to create word-of-mouth marketing is to give your product away. Yes, you read that sentence correctly: give your product away. You start by making a list of the top people you would like to have as your customers. Who is your target market? Who do these people listen to when trying to make product decisions? What if these influential people had your product—and didn’t have to pay for it? If your product is as great as you think, won’t these influencers be excited about it and tell everyone else they know?24

Sales Promotions

Sales promotion is a form of communication that encourages the customer to take immediate ac- tion. Good examples of sales promotions include coupons, sales, contests, sweepstakes, giveaways, samples, “buy one get one free,” and other gimmicks. They range from inexpensive—sales fly- ers photocopied—to expensive—all-expenses-paid vacation. They are relatively easy to manage— sales and coupons—to much more complex—contests and sweepstakes. Frequent buyer programs (as described in Chapter 9) are also examples of sales promotion. When using contests and coupons, it is a good idea to check into local and state laws, since there are some places that prohibit or limit

how these are used. For example, if you use a sweepstakes in Florida or New York, you need to post a bond equal to the amount of the prizes.

Building a Press Relations Program

Press relations are those activities you do to influence or increase media coverage of your busi- ness. Media include newspapers, magazines, websites, blogs, radio, and television. These can be targeted to the general public or for specific groups like industry or trade associations, professions, neighborhoods, or lines of business (e.g., gas stations, restaurants, etc.). In this section we talk about how to target media outlets that can do your firm the most good, how to develop the keys to any media strategy—your press release and press kit—and even how to determine what a media outlet might find newsworthy.

Targeting Media Outlets

Building a press relations program is a lot like planning any other aspect of marketing. It starts with your target. In public relations, determining your target is determining which media are likely to reach your customer. This may include radio, newspapers, magazine, television, and newsletters. Since you are a small firm and perhaps local in scope, national media are probably not for you (un- less you have invented the next Google, YouTube, or other breakthrough technology). Most com- munities have local publications promoting local businesses. Local television stations won’t offer you 60 Minutes slots, but like to feature stories as fillers in their newscasts—especially if the story is newsworthy, of human interest, humorous, or generally “feel-good.”

As with personal selling, make a list of these media and then determine which ones are most likely to carry the sorts of news you offer. Treat them as if they are your customers. Find out the main contact people, their phone numbers, and do a Google search to see what stories they cover and find out more about them. Ask if they have any preferences as to how they like the information delivered. Send them your press kit and ask for theirs.25 Some will prefer that you write the story and let them edit. Others will prefer to send out their own reporters.

Additionally, the press release can be used on your website, as handouts to clients, or included in direct mail. If you are a presenter at a meeting or conference, pass it out as background information. Frame it and hang it in your place of business. (Many restaurants hang favorable reviews where

clients can see them as they wait for their table.) And, as with personal selling, continue to build your relationship with the media. Include a link to the article as part of your signature.26 Now, you need to determine which story you will send out and write the press release.

The Basics of a Press Release27

The press release (see Skill Module 10.2), like the one seen in Exhibit 10.2, is the key method for telling your business story. Entrepreneurs can use the AIDA (attention, interest, desire, and action) formula to write press releases well.

? Attention: Get their attention with a catchy headline. Something clever or a play on words may do the trick. It needs to be short—no longer than ten words and preferably less. Some- times a subtitle may be used, especially if the attention-getting title may not give enough in- formation. For example, “Udderly Delicious: Dairy Marketing in Venezuela”28 is the example of a clever title—a pun—and a subtitle to explain what the article is really about. Try to strike an emotional chord with your readers. Empathize or address a problem they have and you may draw their attention further.29

?     Interest: While the title should start to pique their interest, the opening paragraph should really capture them. This first paragraph should include the who, what, when, where, why, and how of the story. If you are really good, you can get all that in the opening sentence. The idea is to “hook” them and get them to read further.

? Desire: Now provide the meat of the press release—details that tell us more about the open- ing information and increase our interest. Depending on what your press release is about, this could include features of your new products, or some biographical information on the new person you hired. Start with the most important information in the story because editors frequently delete ending materials to fit space. Quotes from key people from outside the com- pany can imply third-party endorsements.

? Action: At the end you put contact information. Where can they find out more about your wonderful new product, your exciting new vice president, or this fantastic company that just won an award? The goal is to get them to be potential clients; kind of hard if they don’t know where to find you!

Resources for E-Mailing Press Releases31

Once you have developed your press release, there are a plethora of websites that can assist you in sending or e-mailing your press release to the appropriate media. These include:

? ABYZ News Links—contains links to more than 17,200 newspapers and other news sources from around the world: www.abyznewslinks.com

?                Gebbie Press—where you will find a wealth of media information: www.gebbieinc.com ? American Journalism Review—a great link to media sources that are on the Internet: www

.ajr.org

The press release is often included as part of a press kit. Press kits are a variation of the sales kit mentioned earlier. Press kits include brochures, business cards, product information, and other materials that can provide background material for a reporter. They should include a letter of in- troduction and may include a brief history of the firm and information about the owner and other key managers. Include other press releases, articles, and other newspaper clippings about the firm and other such material. Consider including a “frequently asked questions” page, information about awards, audio and videos of television, or radio interviews. Financial statements, if you are publicly traded, are a must. If appropriate, include samples of your products, camera-ready logo art, statistics specific to your industry or target market, photos, and even an order form—they could be your next customer!32 Whenever you run across a new media outlet appropriate to your clientele, add it to your media list.

What Is Newsworthy?33

Press releases are meant to draw the attention of the public to something that’s new and newsworthy which could be a range of things, from products and people to services and solutions. To further garner serious attention from the media and the public, a news story needs to deliver certain essen- tials that will hold readers’ attention, and keep your news in their thoughts. It should have public recognition, public importance, or public interest.

Public recognition includes issue recognition (Have you solved a problem that is an at- large issue? If your problem is not familiar to the public, people need to be familiarized with it before they understand your news), trendiness (Is your news a low-carb diet or a Cabbage Patch Kid? That is, will you be able to ride the wave of fashion or will you be just another in a long and dated line of related stories?), famous faces (If the news is connected to one or more recognizable people or organizations, the public will already feel a connection to the story.), and proximity (News is sure to attract attention if it can potentially affect a number of people. The more people it will affect, the further your story will spread.). Public importance includes power (Does your news represent a power struggle or shift? Power affects the community, and the farther its potential reaches, the more newsworthy the event.) and currency (Your event will have its greatest importance while the issues are current. Will your news be connected to other recent events?). Finally, public interest includes a good story (Does your news present a good conflict and resolution? Nothing grabs attention and memory better than a good story.), human interest (A character with whom the public can relate helps generate interest and attention. Can you pull human interest into your news? The human interest story line helps connect the news to the audience with emotion.), visuals (graphics—action, photography, and so on—draw atten- tion to the piece, making another connection between viewer and the news. Are there interest- ing visuals in the piece?), and cultural resonance (Broad cultural themes expose the event or

news to a wider audience. Does the event or campaign speak to a wide demographic range? Is it meant to?).

Even though something is “new,” it might not have enough of the three “essentials” above to grab the attention you had hoped. For example, hiring nonexecutives doesn’t hold importance for the media. Even new products aren’t newsworthy unless they are something new and innovative on the market.

Leveraging the Press and Generating Publicity

How do you further leverage the press to grow your business? The press can be extremely valu- able in helping businesses of all sizes succeed and gain market share by generating a high level of exposure to a wide audience. As discussed above, the first challenge is to develop that unique story or angle, but once that is done the next task is to find the appropriate person at specific press outlets that would be interested in this news. All reporters or editors have their own beat, so it’s imperative that you do your research before approaching them to find out what kinds of stories they typically write, what trends might be interesting to the audiences they write for, and whether or not they just did a similar story last week.

For a small business, mentions in the “corporate notes” sections of the daily and local business papers are a good way to start. These are great places to list new client acquisitions, project comple- tions with substantial results, and new hires—all reflective of a solid, growing company. Consumers and companies want to buy goods and services from a company that has demonstrated it’s going to be around in a few years, not one that has an interesting idea but can’t properly articulate why the idea is good.

Building a Public Relations Program34

Public relations include publicity and other forms of communication to the public in general in order to promote a favorable opinion by the public about your firm. For example, corporations send out shareholders’ reports in order to provide information and create a favorable impression about the firm with the shareholders who may never be one of their customers. Other publics that are rou- tinely the target of these messages include government, education systems, special interest groups, neighbors to the firm, competition, other business in general, employees and potential employees, investors, and, of course, potential clients.

Public relations have some weaknesses as a tool. Many people regard public relations stories skeptically: “Of course they will tell us only the good things and not the bad.” Some feel that these stories are a thinly veiled advertisement. Also, these are very difficult to control. A firm may spend many hours and resources developing and submitting press releases or other publicity and the news media may never use them. Or, often worse yet, the news media will edit the press release to the point that the original intent is totally distorted.

Public relations are those things you do to help create a favorable opinion of your firm in the mind of people in general. For most businesses, the more people who know about your business the better, but this only works if people have a positive opinion about your firm. Often it is easy to do things which help get you a favorable opinion from others. Activities you undertake which show your willingness to help others, through pitching in or sharing time or expertise, can do a lot to build favorable public opinion.

To show your expertise, consider writing articles for magazines35—not press releases, but an article addressing a problem you can solve, a human interest story, or something about which you are an expert. If it relates to your business, this will help establish you as an expert in your field.36 (College professors do this all the time.) This gets your name out among potential clients, generates referrals and strengthens your competitive advantage. You can also offer different media to consider you as an expert opinion on related news articles. Include the articles in your press kit or use them as you would other public relations materials.37

To show your good will, consider sponsorships or donations. For example sponsorships can be a good way to get the word out about your firm. Your budget will not cover renaming a local major league baseball stadium, but it might put your name on the back of a T-ball team’s uniforms

in a neighborhood where your target market lives and plays. This spreads good will among the local community and might even be picked up in the press. If a community group has a program which would attract your target market, approach the group about sponsorship. Unexpected money is often the most persuasive to sponsored organizations.

Donations are the other paying forward approach, and do not need to be millions of dollars. Products that are nearing expiration, returns, or slightly out of specification may be donated to shelters or other nonprofits. Time maybe donated to read books for the blind; small cash or product donations to local theaters will get your name in the program. Some of these will not result in instant publicity, but can be worked into company history or biographical information.39 In addition, dona- tions can have tax benefits for your business.

There is another approach for building positive public awareness of your business—creating a publicity event. This works best if it is tied into what you sell. Additionally, it is likely to get more press if the idea is not seen as self-promotion. For example, Immaculate Baking Company baked the world’s largest cookie—100 feet in diameter and 40,000 pounds. This put it in the Guinness Book of World Records but also generated publicity. What made it even better was that Immaculate Baking tied this into a fundraiser for the construction of a local folk art museum. Sales went from about $500,000 to over 7 million and the museum gained $20,000 in dona- tions.40 Even simple approaches can pay handsome dividends. Hold an open house or a tour. Have a booth at a local street fair. Celebrate Grover Cleveland’s birthday with special activities throughout the day. You can even hold seminars or programs on issues of immediate interest when your firm has topical expertise, or you can give your site to the media as a place to film outside of the studio, but if you do, make sure your signs are visible. These approaches are not the only ones possible. Others can be found in The Thoughtful Entrepreneur: Tips for Generating Publicity.

Two Ways to Generate Publicity41

Even though it may be the latest innovation on the market, a newsworthy product, event, or service always benefits from well-planned publicity. Aside from advertising, there are several tools that can help your news gather a piece of the limelight.

1. Write or provide materials:

? Offer exclusive articles, photos, or columns to publications that are read by your target audience.

?      Offer (through a national service) ready-to-reproduce, typeset feature stories to smaller news- papers (mat releases, color pages).

? Not-for-profit organizations can produce public service announcements for broadcast, print, and other media.

?       Produce and distribute video or audio news releases for the broadcast media. ?      Produce your own program or short feature for the broadcast media. Depending on distribu-

tion rights, this might also be used as a video brochure or for other groups. ?       Include your products as props for films and TV shows (consider whether the show’s message

would help or hinder your product’s image). 2. Conduct interviews:

?                         Appear on local TV talk shows or radio call-in shows. ?              Hire a professional spokesperson to make appearances and talk about your product or service. ?                      Take your message to the media on a multicity media tour.

Having a great product or service does not do you or your business any good if potential customers do not know about it. Getting the word out about your business and its offerings is the purpose of promotion in small business. The avenues for getting the word out are fairly well known—current or potential customers, the press, and these days the Internet—but because everyone knows those avenues, crafting and distributing a message that people will notice and respond to amid all the ads they face is an ever-increasing challenge. This chapter focuses on preparing you with the basic skills of press and public relations, as well as advice on what makes promotion efforts pay off. Armed with these ideas, you can make your business stand out and be noticed. The other key role of this chapter is to discuss the specifics of selling—how to get started and how to close sales. In the end, sales are everything, because everything in business depends on sales. If you can master promotion and selling, your business will have gone much of the way toward eventual success.

1. According to this chapter, what five elements of the “promotional mix” are included in the typical message conveyance?

2. According to this chapter, what are the 5 elements of the general formula for generating interest in your product or service (and getting sales)?

3. What are the categories of tips given by Cord Cooper of Investor’s Business Daily listed in this chapter?

Answer 1

1. In this case there are five elements of promotional mix is included which are mentioned below:

Advertisement.

Sales promotions.

Public relations.

Direct marketing.

Personal selling.

1) sale and promotion: Sales advancement alludes to 'those showcasing exercises that empower buyer shows and expositions. Sales advancement is an indispensable scaffold or an interfacing join between individual offering and publicizing.

Deals advancement exercises are attempted to accomplish the accompanying goals:

1. To expand deals by exposure through the media which are reciprocal to press and publication publicizing.

2. data spreading and merchants , to guarantee the item getting into tasteful use by a definitive shopper.

3. To invigorate clients to make buys at the purpose of procurement.

4. To provoke existing clients to purchase more.

5. To present new items.

2 . advertisement: Paid, non-individual, open correspondence about causes, merchandise and ventures, thoughts, associations, individuals, and spots, through means, for example, regular postal mail, phone, print, radio, TV, and web. An indispensable piece of showcasing, commercials are open notification intended to educate and persuade

3) public relation: Public relations (PR) is the way associations, organizations and people speak the general population and media. A PR authority speaks with the intended interest group specifically or in a roundabout through themedia and make a plan to and keep up a positive picture and make a solid association with the crowd. Cases incorporate official statements, pamphlets, open appearances,

4)direct marketing: Direct showcasing is a type of publicizing in which organizations give physical advertising materials to purchasers to impart data about an item or administration. Coordinate promoting does not include ads put on the web, on TV or over the radio. Sorts of direct advertising materials incorporate lists, mailers and fliers.

5) personal selling: Personal offering is the place organizations utilize individuals pitch the item after meeting eye to eye with the client. The venders advance the item through their state of mind, appearance and master item learning. They intend to illuminate and urge the client to purchase, or if nothing else preliminary the item.

Q2 .There are 5 elements of general formula in this serve.

Prospect and evaluation.

Prepare.

present.

Close.

Follow- up.

Q3 .Repeat the need, Listen, when might you need it, get input, handle purchaser's regret, offer the outcome, utilize more than one result, take vital preferred standpoint, be tolerant, collect yeses, counter emphatically.