Share of Social Generated E-Commerce Revenue and Sales

Retailers and brands are therefore increasingly focusing their attention on social commerce.

Overall usage on social media platforms is exploding. Millions and millions of consumers are expressing likes on Facebook, tweeting about products on Twitter, and pinning on Pinterest every single day. Many owner/managers look at these numbers differently either clear understanding or lack thereof ‘how to translate online traffic into tangible numbers to their online platforms and then into sales’.

Social Commerce Revenue ImgA

Source : www.addshoppers.com March2013-April2013

What you don’t get are any sales. And sales continue to be the only ROI metic which really matters in business.
Engagement is is banded around online, and working with many craft and food business who actively engage online through many sites with their followers, I have begun to question the logic in investing money in an army of ‘Fans’ who couldn’t give two hoots about the brand and have very little intention to engage with you to purchase your products.

Social Commerce Sales ImgA

Engagement – ‘Likes’, shares, comments.
The problem with engagement? The metric becomes the goal and, quite understandably, stressed-out social media managers focus on new likes, tweets, pins or what ever tickles their fancy (KPI’s) rather than delivering real value. Hence you get pictures and comments of animals, social events. Cute kittens and a disproportionate interest in how audiences are going to spend their weekends.

Social Commerce Sales Revenue Comparison

Audience size doesn’t always translate into more revenue. Smaller brands tend to have bigger audiences and I think this is due to better communication strategies
How is social media ROI measured?
Often times you as the business owner focus on shiny numbers like Likes and Followers. Numbers that are definitely part of social media measurement but does it reflect on the bottom line, money in the till at weeks end?  The fun part is when the accountant asks:
“So now, how can we turn all those likes into tangible sales?”
 

Marketing Strategy

Marketing Strategy

Developing and implementing a marketing strategy is a necessary process for a successful business. This process commences as you start your business, and it must remain an on-going process throughout the life of your business

Here are a few points to help you get started:

  • What is it that you are offering your customers? Know your product or service – Ensure that your staff are aware of what you are selling.
  • Know your competitors’ product or service better than they do. In what ways do their products or services compare better/worse than yours? What trading terms are they offering? Is their location better/worse than yours? What is their pricing structure? How are they adding value to their products?
  • Who are your customers? What is the demographics of your customers?
  • What is the image that you are trying to present to for your customers?
  • Is your market subject to seasonal changes?
  • What is your pricing policy? Is it consistent with your need to develop a required gross profit while meeting your customers’ expectations, do you cover your costs and something for future investments?
  • Do you know how to promote and advertise your business? Have you decided which advertising medium is suitable for you and your business?

I am presently working with many small business owners, by some of which some of the points are ignored, claimed ignorance or not even in their business sphere of operations. Many business start out with a great idea, do some market research and then run with it without as part of their business model develop a complete marketing strategy. You may make your product, and for the lucky few your customers come to you, but for the majority of us, including Id8 Consulting, we have to continually develop and monitor our business model, marketing plan and identification of who our customers are.

“Marketing is getting the right product or service in the right quantity, to the right place, at the right time and making a profit in the process”.

Marketing is about identifying and understanding your customer and meeting their needs through the use of your products, giving them what they require. Effective marketing is a result of examining every aspect of your business and how it affects the consumer’s end experience. It covers everything you’ll need to do in order to deliver your products and services to the consumer including research, planning, pricing, packaging, promotion, selling and distribution.

Write a successful marketing strategy

A well-developed marketing strategy will help you realise your business’s goals. A good marketing strategy helps you target your products and services to the people most likely to buy them.  Developing a marketing strategy that includes the components listed below will help you make the most of your marketing investment, keep your marketing focused, and measure and improve your sales results.

Identify your business goals

To develop your marketing strategy, identify your overarching business goals, so that you can then define a set of marketing goals to support them. Your business goals might include:

  • increasing awareness of your products and services
  • selling more products from a certain supplier
  • reaching a new customer segment.

State your marketing goals

Define a set of specific marketing goals based on the business goals you listed above. These goals will motivate you and your team and help you benchmark your success.

Examples of marketing goals include increased market penetration (selling more existing products to existing customers) or market development (selling existing products to new target markets). These marketing goals could be long-term and might take a few years to successfully achieve. However, they should be clear and measurable and have time frames for achievement.

Make sure your overall strategies are also practical and measurable. A good marketing strategy will not be changed every year, but revised when your strategies have been achieved or your marketing goals have been met. Also, you may need to amend your strategy if your external market changes due to a new competitor or new technology, or if your products substantially change.

The six “Ps”

The following six areas provide a comprehensive framework for developing an effective marketing plan. These areas are often referred to as the “6Ps” or the ‘marketing mix’:

Product

This covers the combination of goods and services that your business offers. It could include the following characteristics of your good or service: quality, variety, design, features, services, warranty, sizes, packaging, brand name and returns

Place

How does the consumer access your product or service?  Think about in; distribution channels, coverage, inventory, transportation, logistics and retail outlet location.

Price

What approach will you take to pricing your product? Will you offer discounts or extended payment periods? What credit terms will you set?

Promotion

How you communicate with your customers. Most businesses use a combination of advertising, personal selling, referrals, sales promotion and public relations

People

Your staff are the front face of your business. Try to understand your staff in terms of their knowledge, experience, skills, communication, teamwork and attitude

Process

The processes that you use in the day to day operation of your business. This effects your interaction with your customers. Think about the following aspects of business operation:  systems, quality control, planning, review, continuous improvement, documentation and feedback channels.

What is market research?

Market research is a key part of developing your marketing strategy. It’s about collecting information to give you an insight into your customer’s mind so that you understand what they want. You can also do market research to get a better idea of market trends and what is happening in your industry sector.

Research your market

Research is an essential part of your marketing strategy. You need to gather information about your market, such as its size, growth, social trends and demographics (population statistics such as age, gender and family type). It is important to keep an eye on your market so you are aware of any changes over time, so your strategy remains relevant and targeted. There are many online sources that can be used, the CSO is a good starting point.

Profile your potential customers

Use your market research to develop a profile of the customers you are targeting and identify their needs. The profile will reveal their buying patterns, including how they buy, where they buy and what they buy. While you try to find new customers, make sure your marketing strategy also allows you to maintain relationships with your existing customers. Current customers are a good basis for research into new customers, your most popular items should under the 80/20 rule be valid with new customers also.

Profile your competitors

Similarly, as part of your marketing strategy you should develop a profile of your competitors by identifying their products, supply chains, pricing and marketing tactics.

Use this to identify your competitive advantage – what sets your business apart from your competitors. You may also want to identify the strengths and weaknesses of your own internal processes to help improve your performance compared with your competition.

Why do I need a marketing plan?

  • A successful business operator understands
  • What they are offering the customer
  • And how it differs from their competitors.
  • What are you offering your customers?

The process of developing a marketing plan will help you understand the key benefits and features of your product or service, and how to go about attracting and retaining the right type of customer. The marketing plan is a component of your business plan.

A significant component of your marketing plan involves in depth industry analysis which will help you to segment your target market and appropriately position your business.

A good marketing plan will also provide you with clear objectives so that you can benchmark your achievements and measure the success of your marketing endeavours

Test your ideas

In deciding your tactics, do some online research, test some ideas and approaches on your customers and your staff, and review what works. You will need to choose a number of tactics in order to meet your customers’ needs, reach the customers within your target market and improve your sales results.

Once you have this completed, the loop is complete and you need to start again to address your marketing plan. As the business environment are in a continuous state of flux, you cannot say, hey that’s the plan done, lets run with it for next few years. You need to start again and understand your business model, following on to your various business strategies.

Managing Clients – Consultants

Every consultant / department manager has experienced that one client or person who simply cannot knuckle down and focus on what he or she is supposed to be doing.  This can make life very difficult for everyone on the team, especially on the consultant who rely on client feedback to move the project forward.

These are the clients who simply do not reply to emails requiring action, or who are never at their desks when you call.  Needless to say, it can all get quite frustrating.

So how do you deal with these overwhelmed clients without being condescending, and without losing your patience?

Set Expectations and Priorities Straight from the Start

At the project start, when you meet with the client, establish what the goals of the project are, the short term, mid term and long term plans. This will allow you to allocate the resources and work priorities adequately during all stages of the project. Accomping these plans include in the project schedule key milestones and deadlines. Make sure that all stakeholders are on the same direction when it comes to the project.

If you have set unachievable, unrealistic goals or have them set for you, you’ll feel constantly stressed. If you believe that meeting your deadline is impossible, speak to your client and find out if there are any areas of the projects that they want completed on a priority basis and which ones can temporarily be held off.

Schedule Weekly Status Meetings No Matter Where You Are

If you are not in the same geographical location, modern technology is a virtue, making meetings easy to accomplish. Meetings with your clients are held on a regular recurring basis at a set time.

Weekly or set periodical meetings will suffice, be these face to face or virtual, projects that require frequent input may require a greater client interaction, especially at the initial project stages. Make sure that the client is adequately briefed via reminders both email and telephone. After a period of time, these meetings will become an expected touch point where you capture the attention of your client.

Follow up via Telephone to Report Critical Areas of Progress

When you send a progress report that contains critical information (action required or not), it is crucial you follow up with your busy client via phone.  Many times, the chances of your client actually reading the report are slim, and a follow-up phone call can be used to indicate any red flags or areas where action is required.  Do not simply call to ask whether the report has been received- only call with a purpose.

Patience and Persistence is Key

Dealing with clients who are too busy to focus on the present requirements can be annoying and at times off putting. By staying calm and being patient, this will allow you to focus on the big picture, as you are always the one who has to follow up. As a project manager, it is your responsibility to manage difficult situations.

Being a consultant can be difficult, but rewarding at the same time. Dealing with difficult clients, you will more quickly gain experience. The key to any project is clear and concise communication. People who are too busy to focus need a little bit of spoon feeding and a nudge in the right direction. It’s important to remember that it’s (typically) not a reflection on the work your team is doing.

Relax every so often

We all know how stressful projects can be and the things that can go wrong while they’re in progress. While that may be out of your control, try to arrange for you and your team to relax. It can be something as basic as getting away from your desks and out of the office for 10 or 15 minutes. Other members of teams might opt to plug themselves into their MP3 players for some music. The key is to not keep working full throttle–anytime you can avoid it–for the duration. Exhaustion is as bad as it sounds. It affects your ability to work fast and think clearly, not something you want for a successful project.

Business Model and Business Plan

What is the difference between Business Modelling and Business Planning?

Is there really a difference or is just another name?

 

The ‘business model’ is the vehicle you are going to use to run the race. The business plan is how you will win the race. Changing the business plan has absolutely no effect on the business model.  I look at the business model as the “what” the business is about or what it will do for customers. The business plan is a more detailed definition of “how” the business will execute the model. It is much easier and cheaper to iterate what the business is about using the canvas before ever putting the wheels in motion to build everything in the plan needed to bring the model to life. Business planning includes such activities as researching the market place, establishing customer expectations, setting goals and establishing desired strategies. Depending on the business plan, the business model may have to be updated.

Lessons Learned from “No Plan Survives First Contact With Customers” by Steve Blank are the following:

  • A startup is an organisation formed to search for a repeatable and scalable business model.
  • There are no facts inside your building, so get outside and get some.
  • Draw and test the Business Model first, the Business Plan then follows.
  • Few if any investors read your business plan to see if they’re interested in your business
  • They’re a lot more interested in what you learned

Lessons Learned from “Business Plan” by Steve Blank are the following:

  • Business plans are the leading cause of startup death
  • No Business Plan survives first contact with a customer
  • Rapidly changing markets require continuous business model iteration/customer development
  • Business plans are the leading cause of startup death
  • Your ability to raise money has no correlation with customer adoption

These Lessons confirm that “Business Plan” follows “Business Model”.  The relationship between Business Model and Business Plan is very clear…

You need a Business Model to validate and test your hypotheses about Business-Idea for Revenues, Costs & Profits, using the 9-basic building blocks…

then…

you need a Business Plan to development and present your Business-Idea to Stakeholders & Financial Institutions (banks) to raise funds and invest in the business

What are the uses for a Business Plan?

1. Raising capital

2. Financing

3. Attracting Executive Talent

4. Alliances

5. Departmental uses

6. Keeping current

7. Staying on track

8. Long-term Planning

9. Improve communication

 

What are the uses for a Business Model?
1. Defining Indicators
2. Improving Decision Making
3. Improving Strategic Planning
4. Helping in the Design of Information Systems
5. Increasing Innovation
6. Improving Process Design

The business model is the heart of the business plan. The how, the strategy, to win the race. Before the business model you need to know where the end of the race is (goal) and how is the external environment to better adapt-design you car.

I work with SMEs wanting an internal BP to improve and grow their business. I use the business model canvas to get a plan of the business, and to identify areas for improvement and growth

Niche Business

Niche markets means you’re working with a much smaller customer base but the market space is less congested that you can make your own brand stand out and shine.

Business operating in niche markets are surer of foot, able to adapt to their customer needs and requirements, know their customers and generally have a higher degree of customer loyalty, all dependent on excellent service. Therefore, it helps to consider some of the ways you can succeed in a niche market, as well as examining some of the companies that have done the same – and how they did it.

Market Research

Do you know what your customers want, where they hang out, what their needs are, their best methods of shopping (route to market) and whether you’re equipped to deliver what they expect, you’re already halfway to staking your claim on a small market space. This also allows you to craft a brand that resonates with the segment of the population that is most likely to buy your products or services.

Consider the following questions:

  1. Can you identify prospects within the market that I can communicate with?
  2. Do these prospects need or have a strong desire for what my business offers?
  3. Is my offering suitably priced for this market? (If not, can it be?)
  4. Can I communicate a sales message to this market?
  5. Is this market large enough to support my business?

The more specialised your focus is, the better – customers will appreciate feeling that you’re fulfilling a specific need they have, and will be more likely to go back to you in future.

A benefit of operating in a niche market: the more business you do, the more you learn about your customers. Analysing customer data to find trends that can be used as springboards for future strategies is much less complicated when your customers are a small group who tend to share similar traits, rather than the populace at large.

Artisan Business

Artisan Craft business, those that are manufactured using your hand in some nature, is a difficult business to be operating in, even when the climate of recession or depression is not in our midst. Small craft business are indicative of all business, subject to the many ups and downs of normal business life.

Trends that are hot for months or years suddenly die out, and new and unexpected hot niches develop overnight. There are some things that you can do to help your Artisan Business to be successful over the next few years.

People always desire crafts, and the purchasing power is not going to disappear altogether. There will still be people buying gifts and decorating homes and going on holidays. These people all try to get the best value for their money that they spend.

 

Service

So in these recession economic times service becomes extremely important. You must enhance your customer service, people are still requiring quality and your product if it matches their needs will be sought after. This is an area where you must consider, who is your customer, observe them in their shoes

  • Can you do custom work.
  • Can you make your craft scaled to fit the customers exact measurements?
  • Can you install that custom piece of furniture that you built?
  • Are there colours or finishes you can offer that your competitors can’t duplicate?

Customised service is very important and people are willing to pay for that personalised touch, of there is the high quality service to back it up. Success means you will have to work harder but is that anything new these days?

Price

Your price point may become an issue, take a ceramic bowl for example. You may be selling a 12″ round bowl as your main product, but now may see this as become a rare sale, its not rocket science to try smaller products with lower prices. Match the expectations and pockets of your customers.

Try to develop several price points, so that you are broadening the appeal to your customers. There will occasionally be sales of the high ticket items. You will find most of your sales come from the mid price products so make sure you have lots of the mid range on hand. We all know that impulse buying occurs, my experience is sub twenty euro, people will purchase, in the twenty to fifty euro price bracket, there is a consideration or consultation, and above that its a case of step back, evaluate the (your) product

Consider:  An old tip but still works, is to take your top end and make that your mid-range price point. Suddenly you have up scaled your business and your customers will still tend to buy what you normally produce. This is a bit tricky as you don’t want to invest heavily in your new top end products. It can make you top heavy and set you up for a financial crash.

Training & Demonstrations

Would you consider additional income from classes, demonstrations, workshops in whatever guise they take?  Could you develop classes based on your craft.

“Learn How To Make______”   You possibility to have additional sales with supplies, material, course work to your students. It can be lucrative and very rewarding. It brings in fun to the experience, you have shared experiences, giving them pleasure from something they made, and they are entertained. They also become a champion for your products. People develop an interest in the arts and crafts, and in their minds they are getting good value for their money.

Internet

We all have our website, blog, twitter, Facebook, don’t we ?

Every consider video, a short 1 – 2 min video clip of you making your product?  This is a powerful medium, as you have the opportunity to embellish our story, people buy you firstly, then your product next. Watching you hand craft your product, the passion behind it, the love and attention you give. Have it linked to your website, it will increase the Google page rankings and potentially traffic to the site.

Recessionary times need not cripple your business. Always keep you customer in mind and go that extra step to make them feel valued. You may have to work a bit harder for the next little while but that doesn’t mean you can’t survive it.

What business are you in, can you define your environment?

Can you define?

  • What business you are in?
  • What environment you are operating in?

The Challenge:

This begins with a problem or a goal that needs to be achieved; this is formulated into an innovation challenge. This is presented to a group or team to solve this task, or generation of possible solutions. This may be done in the form of brainstorming, idea generation or other innovative process. The team can consist of employees, suppliers & customers, general public or by the use of crowd sourcing.

Collaboration

In order to maximise the potential outcome of the problem solving group, the methods to generate ideas should be collaborative, and if possible fun. When we are enjoying an activity, our mind relaxes, lets down our guard and we tend to be more creative.

Combination

Ideas in this process cycle starts with a challenge, ideas come from all aspects of your business, process, services, products, staff  and more besides, they can be interrelated, diverse and perhaps complimentary. The best method is to combine these complimentary ideas into clusters that can be handled in a single package.

Idea Generation

Idea generation, organisations can spend resources on idea generation, only for this ‘report’ handed to a superior who cherry picks a solution, which is less than an ideal method, hopefully based on expertise rather than popularity. The scientific approach of peer review is suited to identify the most promising ideas, ranking ideas based on categories, such as potential development, suitability, commercial or simply the most effective idea to implement.

Testing & Development

Ideas identified as being potential innovation, is now ready to be tested and developed. The uses of prototypes are a good example of testing. Make a prototype, with the basic of features, test it with your customers, and get their feedback, opinions and reaction to its design, functionality and whatever you require.

Of course it is not perfect, but it indicates possible issues in the implementation of the idea, as well as benefits that may not have been obvious to the original idea developers. They are an excellent means for testing ideas. By building ad playing with a prototype, this is a good method of further improving upon the core idea. Prototypes are, ideally suited towards material ideas such as new products, but those abstract ideas, new services, process improvements and other concepts can be prototyped through role-play, making diagrams.

Implementation

Ideas that make it through these stages are typically ready to be implemented.

Review

Once the idea has been implemented, they need to be review, against milestones and targets. Even at this stage, under-performing ideas/products may have to be killed off, and or reviewed at regular intervals.

What do business owners need to know about business model innovation?

What do business owners need to know about business model innovation?

Business model innovation can consist of adding new activities, linking activities in novel ways or changing the way a party performs an activity.

  • Novelty, lock-in, complementarities and efficiency are four major business model value drivers.

  • Within organisations, business model choices often go unchallenged for a long time.

Products and services can be copied, the business model is the differentiator.” The business model we choose will determine the success or failure of our strategy”. Sounds familiar?

Organisations are increasingly focused on innovation in their business models and operations as key mechanisms for driving change.

Indeed, CEOs stated that approximately two-thirds of their efforts are now targeted at business model and operational innovation. Furthermore, fully 61% of CEOs who have a primary focus on business model innovation fear that changes in the business model of a competitor could likely result in a radical change to the entire landscape of their industry.

The IBM Global CEO Study 2006

Successful timing of business model innovation depends on the economic environment, the specific market and industry conditions, and a set of internal factors impacting the organisation.

Successful companies are innovating their business model in three ways:

  • Revisiting the enterprise model to reduce cost through new partnership models and by reconfiguring the organisations asset mix

  • Using strong financial resources to introduce alternative industry models and disrupt competitors

  • Rethinking revenue model and value propositions to respond to a different set of customer behaviors and market requirements.

Not every organization needs to innovate its business model immediately, but the capabilities need to be established in order to act when the time is right. We can help you to map your business model, focus on areas and give facilitate your strategic planning session.

Financial Innovation

Spending time this week on research into organistion’s. Ensuring our contact details are up to date. One question I pondered over? Why do we only have to publish only our company annual returns, the financial and various liquidity ratio’s and not our strategy and or business model.

Our financial returns are familiar to most of us who run business, from those sole trader one person organisation’s to multi billion business. They are a constant in our business lives.

I understand that your financial data and returns are a snapshot of a particular point in time of an organisation with financial numbers to show current numbers compared to previous years, but no mention of your strategy and business plan, in essence your business model. It is just a looking back exercise and not forward planning for you and your business.

Why do we spend time on past performances, yes they can be a guide to future but thats the magic word ‘a guide’. What I would like and hopefully EU may eventually require organisations to submit your business plan / model with returns. You need to examine your strategy for the years ahead. While details may be confidential but how much more than your financials, it will focus you on growing the business.

Organisations vary in their analysis and updating of business plans. We all strive to get them completed for our startup advisors, to get enterprise up and running, banks on board with and then lapse into reviewing it.

  • A reality check, what is your actual performance?.

  • Is your business plan buried in the back of filing cabinet or worse, like your wedding album?

Your business plan is effective, it highlights areas that you may have examined but not pursued. Your business model, we can analysis your performance. Help you step back and observe your processes and methods.

Note to all: Financial Innovation in the context of this blog does not mean an innovative method of booking or creative financial accounting, i.e. avoiding taxes or dodgy ‘creative’ book keeping.

Innovation, creativity and idea generation

Innovation, creativity and idea generation.

We have prepared a series of workshops to assist established organisations to understand the current status of the company, to open their minds and explore new avenues & ideas and develop a plan for the future.

The long term aim of these sessions is to encourage participants to appreciate the importance of creativity in the workplace and to this end we will provide them with guidelines on how to optimise the creative potential of their business. 

Workshops

Identify the business challenge

Where ideas come from – differing perspectives

Brainstorming

Idea Potential and Long-term Creativity

Potential Outcomes:

  1. Participants will understand the importance of creativity and imagination
  2. Participants will learn how to look at their business objectively
  3. Participants will learn tools that will help them identify with their customer in order to generate ideas.
  4. Participants will learn tools for brainstorming
  5. Participants will have a plan of action to encourage ongoing creativity
  6. Participants will have a business idea that they have validated at a high level by mapping it on a business model canvas.