Facebook ads for small business beginners.

facebook advertising for SME's

So, you have a small business and your neighbour tells you Facebook is the place to be, that you can get heaps of likes and sales out of a few dollars.

Not all true, but it can be.

Facebook can be a great way to build a small business into a bigger one, for many types of business, primarily B2C rather than B2B. There are however, some pretty simple hurdles.

Have a clear objective. Facebook visitors do not normally buy off the site, gaining their attention and trust is a process that takes a while. If your objective is to get visitors to click a link in your ad that takes them to your website, the ad copy is likely to be different than one where the objective is to collect likes.

Know your market. Know as much as possible about those you want to attract. Facebook has some really cool filters that allow you to determine who sees your ads, so there is no point in paying for someone who is never going to buy your product seeing an ad. The options cover behavioural, demographic and geographic options.

Don’t boost, promote. Every page has a ‘boost” button on it, which offers a quick and easy way to put your ad in front of eyeballs, but no way to determine which eyeballs. You need to use the Facebook Ads Manager to target your ads, making your dollars work much harder.

Custom audiences. People on Facebook are not generally there to buy, they are there to be social, exchange information, dates, photos, and all the rest. Therefore they may not be interested in your ad, even if it is highly relevant. Facebook addresses that problem by allowing you to upload your own data for use in the campaigns.

Variation. Ads work differently for everyone, so it makes sense to trial a number of versions of your ads, looking for the combinations that work best. You can do this on a small scale if you choose, just to keep the ads fresh for those who see them several times, or if you are spending more, you can systematically split test the differing ads to identify the best options. Some closed groups allow ads only at specific times, and have other criteria that suit the group. In these cases, I usually suggest that the ads change every time. One of my clients places ads in a group that allow them only to be posted on a Thursday, so every Thursday she posts a different ad, carefully targeted at the niche that is a small part of the group membership. Works well.

Be personal. Facebook is at the social end of ‘social media continuum’ so behave accordingly, and choose a tone in the ads that is social rather than  sales.

The genius of social media generally, is that it enables a small business to act like a big one, so don’t miss the opportunity.

There is plenty of help out  there that will assist you with the detail, Kim Garst, various posts on Social Media Examiner, and many others less well known. Use them.

5 planning principals for the major long term sale.

5 principals

Planning to engage a major potential customer is much more than finding the phone number on the web site and ringing reception to ask who is the right person to speak to.

Chances are, even if they know who the right person is they will connect you to the intern.

For years I have been teaching and running workshops with the eye-raising acronym of SKAM.

Strategic Key Account Management.

The underlying logic is that there are only 3 ways to engage with a customer that leads to a transaction that is of a significant size:

You can help them increase their sales

You can help them increase their productivity

You can help them reduce their costs


On another level, there are some questions that you can ask yourself, and in the answering, arrive at a number of possible approaches, as it is rare that the first you try will work, but learning from the experience will help you with the second.

  1. How to I add value to what they are doing
    • How do I demonstrate knowledge that I can make available to them that they will benefit from
    • What trends or technologies can I bring to their attention that at will impact on their future profitability
    • What insights can I bring to them
    • What specific knowledge can I share

2. How do I go about building trust.

    • What about their internal culture can I tap into and make a contribution
    • What do the need or want that I have, and can give them

3. What can I do to be pro active and demonstrate my ability to work with them and help them achieve their goals

    • What insights can I bring to them that will be of benefit?

4. How am I accountable for optimum results.

    • Sales do not stop with the payment cheque. After sales service, warranties, ongoing advice, and so on all demonstrate that you are accountable for the promises made before the cheque was cashed.

5. How am I going to continue the engagement after the first transaction

    • Once a customer has bought from you, if you do the right thing, you will have them as a customer again, and again. It is very useful to measure your “share of wallet
    • Would they recommend your services to their networks? Asking for referrals is a powerful marketing tool when you have satisfied customers, as there is no more powerful toll that word of mouth advertising.

Success in B2B sales of significant products, not just paperclips, takes patience and planning. It almost never evolves the way you expect, and almost never as quickly as you would like,  hang in there.

Is FMCG Private label able to continue to grow?

private label

Australia’s Grocery retailers continue the march towards private label range dominance, basing their strategic decision making on two foundations, it would seem to me.

  1. By controlling a large section of their sales via PL, they manage to both increase their margins at the same time they reduce their transaction costs. Good trick if you can get away with it, and in the short term they certainly can, but in the long term?? Who knows.
  2. What works in Europe, and particularly the UK will work here. Over 40 years in this industry, this has certainly held true, what works there generally becomes translated here at some point, in some form.

However, when considering the future of PL as a part of the landscape in Australia there are a few other considerations not present in the UK, and elsewhere in Europe.

  • We have large distances, and  a smaller population, making the economies of scale in manufacturing  and distribution that much more elusive, and less attractive. In western Europe you have 350 million, or thereabouts living is far less space than Australia occupies, with a multiplicity of manufacturing options. Just the UK has 65 million in about the space as Victoria.
  • Over the last decade, the number of middle sized  Australian owned FMCG manufactures has been decimated by a combination of the high $A, the GFC, and the power of the two major retailers, so there is little left. Now the $A is lower, and the opportunities emerging, they are not coming back. Imported private label products now have to carry the added cost burden as well as the substantial costs and risks of the extended supply chain.
  • Where is the innovation going to come from? Medium sized suppliers have been the source of much of  the innovation that has driven category growth over the last 25 years. While it is relatively easy these days to pick new stuff off the shelves in Europe and set out to copy  it, the retailers still need to have the products manufactured, and often massaged to suit local tastes, not so easy any more.
  • Retailers in taking their ideas from European retailers, seem hell-bent on  segmenting the PL share. No longer the cheap and cheerful substitute, European PL now  offers under a range of house brand labels that cover the market from ‘top’ to ‘bottom’ as well as emerging segments like organic and halal are being pushed, further eroding the power of the proprietary brand. As a marketer I ask “for whose benefit?” certainly not the consumer.
  • The Private label business model that demands minimum transaction costs on both sides does not sit comfortably with the proprietary model, with its complex trading terms. In most cases, suppliers of PL also supply proprietary products, adding to the complexity of the paperwork and relationships.
  • Produce is a bit of an anomaly, as there are almost no proprietary brands. Producers and their representatives have comprehensively failed over 30 years to do any sort of branding job, so consumers do not miss what  they never had. However, increasingly consumers seem to be reluctant to buy anything much beyond robust commodity products from supermarkets, believing after 25 years of cricket balls masquerading as peaches, that the specialists do a much better job.
  • This last point is really anecdotal. There appears to me to be a backlash coming from consumers. A typical comment made  to me last week was ‘if I do not want any choice, I will go to Aldi, but when Woolies denies me a choice, I wonder why I pay the premium over Aldi’. The two majors had better be careful, they do not ‘own’ consumers, who will make their choices independent of a retailers profit considerations.

Private label is now irrevocably a part of our lives, but  I doubt if there is too much more room in dry goods for share growth without  compromising retailer margins, but I guess they will be very wise with hindsight.  Meanwhile, the pressure on the few medium sized manufacturers left intensifies.


How to build a small business brand from scratch.

Alt="brand building"

Small businesses have great opportunities to leverage their skills, but now more than ever, they need a brand as the digital spot on which to double down their marketing investment, to create a wall from which to defend their territory.

Most do  not have the skills, and become bogged in the jargon and options, so following are 6 simple guidelines:

Simplicity. You cannot be all things to all people, even in a local area and pretty specific market space. The more targeted the market segment, the simpler the communication and the need to provide more and more to attract clients. One of my clients is a personal trainer, but not one of the toned, buffed 25 year olds we normally see, she is an amazingly fit, middle aged mother of two who specialises in helping immediately post natal women get their pre natal bodies back.   Her journey from young Mum with a desk job to successful trainer is a story her clients all relate to exactly.

Differentiation. Even in a narrowly defined niche, there has to be something other than price that makes you different, and the difference must be relevant to the target market. Continuing the story above, a young Mum can come along to the classes, exercise and relax in a very social way with others in the same boat, while their babies are being looked after in a crèche in easy eye-line.

Originality. Being different is great, being original in the manner in which you express your value propositionn is even better, then delivering that value in a differentiated manner  is the core of brand building. The value proposition of a business is remarkably important, and remarkably challenging for most to get right.

Disruptive. Doing things in an entirely different way to everyone else gets you noticed, and when the disruption favours your target market, you can be way ahead, although those outside your target will probably not “get it”. My elderly mother lives in a regional town, and has her fair share of medication and mobility challenges, but still lives alone in a terrific spot for an old girl. One of the pharmacists in town packages up her medications into a card that puts each of the meds to be taken at a specific time in the one blister, then delivers the card weekly. Any change in med is immediately reflected in the updated card that will be delivered the day she tells them, and any remainder from the previous card taken away. On top of that, the pharmacist is one of the few licensed to mix his own meds from ingredient, so rather than taking a handful of pills, Mum takes just one or two that have the actives combined in one pill where they are compatible. As another bonus, they are generally smaller than many of the throat stuffers that come from “big pharma” Guess who has the market for the elderly in that town tied up!

Symbolism. Humans are visual animals, we value and put meaning into symbols that come to mean way more than just the illustration, or expression. Think about the Nike logo, Nikea powerful symbol of sporting aspiration and achievement, or the  Apple logo, a symbol of beautiful, functional original design, or in Australia where I live, Aboriginal flagthe Aboriginal flag, that has come to express the need for our aboriginal people to express themselves as part of, but different to the rest of Australians.

Meaning. I struggled here for the right word, a word to convey more than just relevance, more than just delivering on a value proposition, something that has a deeper humanity in it than just a brand. Several businesses have made a commitment of “one for you, one for Africa” as a way of adding meaning to their brand, and it works.   My personal trainer mate above achieves this by genuinely caring, and demonstrating that care in a variety of ways,  about the health of happiness of her clients, even when they are no longer clients, usually because they go back to work in much better shape than would have otherwise been the case.

Let me know what you have done to build your brand.


How to make cold emails 90% effective

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cold calling


Almost everybody I know hates cold phone calling, there is something in the psychology that prevents us putting ourselves in a position where absolute strangers can reject us 99% of the time.

“Cold email calling” is the less confronting and can be a hugely effective option, but unless you follow some simple rules, will still be 99% ineffective. It is just that the email will go to the trash, and you will not have to put up with someone rejecting you verbally.

If you follow these rules, and optimise your emails, their effectiveness will explode.


1. Research the prospect list.


It is easier today than ever before to create and segment your prospect list into finely drawn groups, each having a persona that is likely to respond to specific messaging. Sending an email to a professional chef outlining your Aunt Mabel’s favourite cup cake recipe is unlikely to be read.

Ensure you have a strong value proposition for each persona that you draw, one that feeds into their motivations, problems and fears.


2. Have a compelling subject line.


Your subject line is like a headline in a newspaper, or the cover of a magazine in the newsagent. In a very few words it needs to capture attention and lead you to the next action.

Ask yourself, “would I open this email”

Have a compelling “sub head”

Your first sentence is like the sub headline on that same magazine cover. If you watch what works in your local newsagent, it is often piquing curiosity that works best. Writers of these covers are the cream of direct response writers, so model your emails on the pattern that works for them.


3. It is not about you.


If your email opens with “my name is Fred Nurk from ABC Corp, and we provide the worlds best   Blah Blah product” you have probably already lost them. Instead, you need to spell out exactly how you can help them do their job better.

Be conversational. Write like a peer, someone who understand the challenges and opportunities of your target, and who relates to them. Being “needy” is the best way to lose a reader, even if you think your cause is the best in the world. Avoid weak  terms like “I hope..” and “I just ….”


4. Establish credibility.


Without credibility, you chances of converting are minimal. Providing social proof, data, of some sort is essential. A testimonial from an existing customer can be very effective, but these days, they have to be video, and the individual has to be clearly identified, and identifiable, otherwise you will be suspected of writing it yourself or getting one of your mates to do a video.


5. Create a process.


A cold email rarely creates a sale, at best it can create a warm reception to the follow up. This is the entry to your sales funnel.

There are three parts to a successful email process that recognise the “moments of truth” that occur. First you need the finely drawn persona noted above, second, you need to map the buying journey to be able to identify the points at which you can create interest, and third, you should have a schedule. It is easier to map out a series of posts around a topic, then write them, than it is to sit facing a blank screen trying to think of something to write today. Believe me, I have tried both.

None of this is easy, and it takes time and expertise, but does work. There is never any substitute for experienced, professional writing. It is not the case that everyone who can write a letter and ensure the spelling and grammar is OK can write a good sales letter, it is an art, so you are probably better off getting an artist.

Are FMCG marketers failing with digital?

geo location

It seems to me that in the tsunami of digital marketing going on, FMCG is being left behind.

For brands largely dependent on consumer sales via supermarkets, you would think that they would be at  the forefront of finding ways to engage with consumers as a means to loosen the choke hold the retailers have on every day purchases through their scale of operations.

When in store, consumers are driven by the environment to “commoditise” their shopping, constantly bombarded by price activity that has over time eroded the impact that a brand can have, giving retailers greater control of the shoppers purse. Price has become such a central driver in FMCG that I suspect many have forgotten how to really build a brand and market value to consumers, rather than just price and availability.

On the other hand, marketers kid themselves with the notion flogged by the snake oil bunch that people want a “relationship” with your brand, and spending mega bucks on building such a relationship will delver returns. Truth is that most supermarket shoppers, confined by a finite budget give their brand “relationships” little thought when in store. They tend to have a pool of acceptable products in a category, and buy from that pool based on an almost instantaneous response to their previous experiences. Marketers really only  get the chance in to get a considered response when a product is being considered for the first time, or there is some other powerful outside stimulus. It is here that an ability to deliver highly targeted messages to consumers via digital means can have a real impact.

So how do we cut through the haze?.

The old rules of marketing still apply, just digitally.

Years ago I worked for a dairy company, we had a great long life custard product, and the simple co-location of a floor stack of custard next to the bananas when they were in season and a value price, with a bit of POS material, saw the sales of both soar. I have done this time and time again, with different product combinations, and the results have been consistent, problem is finding you way through the planograms and rules imposed by central head offices bent on selling floor space to suppliers and maintaining a discipline at store level, often at the expense of  innovating to sell products to consumers.

How could digital work to enable this proven technique?

Apples iBeacon technology is one of several systems that use location sensitive smart phones to deliver brand messages. Unilever appears to be successfully trialling it with a Magnum promotion in the UK in collaboration with Tesco, who have a bit of history of innovation in the digital space. Retailers also have the building blocks of truly innovative co-location and collaborative activity housed in their loyalty card data. Combine that with geo-location and opportunities really open up.

Young consumers, heavy users of digital are not their mothers, they are distinctly different, and see brands and digital through different eyes. Relying on them to accept a commoditised selection on supermarket shelves is probably going to end in pain, as they select the products and brands they want to interact with digitally, and have a whole range of considerations their  mothers would never consider.

I know this digital stuff is going to work when marketers manage to crack the code, and have the grunt to either collaborate constructively with retailers, or go around them. I have written about the cottage cheese club previously, an analogue version of what is possible, now simple and highly extendable with digital tools.

For heavens sake, get on with it!

The water-bucket method of networking.

goodwill & trust

goodwill and trust first

Networking has always been a great way to build a business, and nothing will ever change that.  Most small business owners go to networking meetings, register on linkedin and all the rest for a simple reason: they want to find more business.

Why is it than that when you go to these places, physically or digitally that it takes so much effort, and traction often seem really hard to build for most?


Most people approach it the wrong way, they go along, hand out business cards, have a chat, and move on to the next prospect.

We all do tend to it.

But, remember, most people are there to gain more clients, not become somebody else’s client, so many times we are approaching it the wrong way around.

You have to put water into the bucket before there is any  in here to take out again.

Pretty simple formula, be prepared to put in before you even think about taking out.

Takes a while, takes effort, and that  is why most fail at it as they want to have immediate results, for no effort beyond going along and participating.

6 foundations of digital marketing for beginners

digital marketing basics

I am constantly surprised at the lack of understanding that many small businesses have of the greatest boon to small business in 100 years, digital marketing.

Last week I had the opportunity to do a short presentation to a network group, and took it by outlining the foundations of digital marketing.

For some in the group, it was yawn time, but for many, it was useful explanation.

Foundation 1. To explain some of the basic terms used in relation to websites, I used the metaphor of a house.

  • The house is the website
  • The land the house is on is the hosting
  • The address is the domain

When you have the house, it needs to be connected to the world, the electricity, gas, and water or it is useless to anyone.

Then you need people to come, to make it a home, but to come they need a reason, in this case the content you can offer them.

Foundation 2. Continuing the house analogy, the notion of the three types of digital media as owned, earned and rented, was discussed.

  • Owned media is your website. You own it, you determine what goes up, and who is able to access what. Just like your own home.
  • Rented media are the various social platforms and forums that we inhabit. We do not own them, so are subject too the rules and behaviour of others, we have no control
  • Earned media is the most valuable, and is when somebody shares in some way content you have posted. It matters little if that post was on your site, a social platform, or somebody else’s site, the fact that it was shared gives it credibility and value. I do not count “likes” in this context, as they are too easy, too automated to be a reasonable indicator of value.

Foundation 3. Traffic sources to your website. In summary there are four:

  • Social traffic from social media platforms
  • Search traffic, which is why having SEO optimises is important
  • Content traffic, coming from content you post, and is shared around
  • Advertising driven traffic.

Clearly there are overlaps and cause and effect at play, but the principal remains. The first three are often classed together as “organic” traffic, while advertising is obviously purchased traffic and as such is less valuable, but usually much quicker to generate.

Foundation 4. Digital marketing is a two edged sword. It enables you to target exactly an extremely specifically defined audience, and address them with very specific offers and information. This is the great strength of digital marketing. The flip side is that you must be able to say No, to a lot of seemingly potential customers, because unless your communication is very specific, it will not get read and acted on. This is very difficult for most. In the event you have several ideal customers, you will need to keep the marketing activity entirely separate.

Foundation 5. The fifth foundation is  the foundation of all marketing, but now way more transparent and obvious; “fish where the fish are”

Foundation 6. Again, not exclusive to digital marketing, but now way more able to be automated and in control of the seller is the sales funnel. Every sales training process I have seen in 35 years in one way or another uses the funnel analogy, and it is equally valid with digital marketing. Difference now is that progress through the funnel can be tracked exactly, and managed pro-actively by the seller using data.


As a final note, there are thousands of tools to make your digital life easier, and more productive. Each person will evolve a way of working that best suits their skills and circumstances. There are many free tools that the beginner can use to cut their teeth, which can then be upgraded or substituted for more productive paid ones. The free tools I use are

Google analytics, Canva.com, Picmonkey.com, Mailchimp.com, Surveymonkey.com, Paint.net, Google keyword planner, Flikr.com and One-note.


The short deck I used I posted on Slideshare

10 lead generating tactics for small business.

lead generation

Small businesses selling B2B always struggle to generate sales leads. Survey after survey confirms it as one of the biggest challenges they have.

There are plenty of tools out there that supposedly make it easy, and certainly they do make it easier than it has been in the past to generate many contacts, but it is still hard to generate a warm lead, and then to convert to a sale.

None of the tools are any good unless you have a crystal clear picture in your minds of the value you can deliver, being “wishy washy” and peppering the conversations with adjectives (particularly “awesome” my latest hate word) no longer works.

Following is a list of options that have worked over the years for my clients. Most are pretty obvious, when they are pointed out.

1. Referrals. Being referred is the best sales lead you could ever have. Someone who is familiar with your work saying “Bill is great at …. you should talk to him”  to a colleague would be wonderful. Yet, so few of us explicitly ask for referrals.  When you have done good work, ask who else your client knows who could benefit from your expertise, not expecting to be referred to their competitors.

2. Testimonials. Perhaps second to referrals are testimonials, people with whom you have worked who are prepared to say in the record how great you are. Video is the only way to go with testimonials. Nobody believes any more that the written ones on your website from “Monica X from Parramatta” are real, they believe you have written them. It takes Monica to front a camera, identify herself and say how great you are for it to be effective, then is very effective.

3. Personal networking. A lot of small business people join network groups, in the expectation that this will lead to referrals and work. It can, but almost always takes time and effort. Others in the group need to understand what you do, and how that is relevant to their problems, then they have to be convinced that you offer the best value solution to them. Being in such a group can be rewarding for small businesses in more ways that just generating leads, as it get them out of the office, and forces them to speak publicly about the value they can deliver, which almost always acts to sharpen the elevator pitch. These skills come in very useful when actually in elevators.

4. Digital networking. LinkedIn is the obvious tool here, too often misused by those who just see you there and immediately start selling. LinkedIn like any social platform requires that you demonstrate your bona fides first, and the best way to do that is to identify the groups, preferably closed ones, where your prospect hang out, and start to engage in the debates and conversations that occur. You  can then follow up privately with some, and have a more focussed conversation about their needs and after a rapport is established, your solutions.

5. Seminars, webinars & e-books. In most cases, our clients buy from us because we have something, or know something that they cannot  get elsewhere. Demonstrating your mastery of a topic by running seminars on them, producing webinars, and writing e-books demonstrates your mastery. The secondary benefit of this type of content is that it can be used, reused, repurposed, and  reused again, and again.

6. Platform cross-posting. Many people blog on their own site, hoping people will stumble over the posts, but there are many other platforms now that can provide a shopfront for your products and services. LinkedIn recently introduced a blogging platform which works very well, you can open up a YouTube channel and post instructive videos, or put great information up on slideshare. Then there is guest blogging, a great way to leverage the lists of others, by adding value to their audience, a win win both ways.

7. Lead magnets. These are things that visitors can gain access to by exchanging their email address. It is a great way to reuse the content you produced in a webinar or e-book. Here the challenge is that you need to attract the eyeballs to the lead magnet before it has a chance of being magnetic.

8. Direct mail. Yes, snail mail does work in this day of digital everything. Now we get so few things in the mail that is not either bills or junk, that a handwritten envelope with a stamp, will always get opened and read. This requires that a modicum of research into your prospects is done, as a wrong spelling or title means immediate filing in the round-file. Best done in small batches, that way you can also test the response to the sales letter you send.

9. Warm cold calling. Bit of an oxymoron there, but a deliberate one. If you do  not know the name and position of the person you are preparing to call, do  to waste your time. However, if you do know  their name, there is a reason they might be interested in hearing from you, and you can articulate that reason in 20 seconds or less, then that implies you have done sufficient research to make a cold call a warm one.

10. Advertising. The last and perhaps most obvious tactic to generate leads. All social platforms survive by taking advertising, they are the newspapers of the 21st century in that regard. You give them your profile and preferences, inadvertently or otherwise, and they sell that to advertisers to whom your profile fits their target. Having said that, the tools available on the platforms are terrific. Both Facebook and Google in particular set about making it increasingly easy to spend ad money with them with features like Facebooks lookalike audiences explained here by Jon Loomer, easy and AdWords strategies outlined by Wordstream.


Most businesses use a mixture of the above, too often randomly rather than as a deliberate strategy. The old marketing communication “rule of 3” still applies: Know what you want to say, know and articulate why it is relevant to the receiver, listen to the response.

7 basic measures of email marketing success.

market digitally

Email marketing is the stuff of small business dreams.

For the first time they can communicate with their markets, being able to measure the effectiveness of their efforts. Unlike the days of broadcast media where the return on any set of marketing activies was extremely hard to calculate, and therefore out of  the bounds of possibility for those without a lot of money to risk,  knowing the return and being able to experience for a modest outlay is fantastic.

There are myths, legends and piles of horseshit proclaimed about digital marketing, and SEO and email marketing key amongst the fodder.

I thought I would try and dispel some of the myths by offering some views of the basics.

This one is about email marketing, SEO will come in a few days.

There are piles of data available from email marketing providers, from the freebie version of Mailchimp to the really sophisticated providers like Infusionsoft, and everything in between. Each provider does things a bit differently, and charges for the levels of sophistication and integration that can be delivered. But all deliver metrics that will help you better target your email communication.

Following are the common, and probably most useful ones.

1. Bounce rate.

Simply the percentage of emails that could not be delivered to a recipients inbox, they “bounce”. Usually this is because the email as written is incorrect, or the email account has been closed, often because an employee has moved on. From time to time, you will get a bounce from an address due to a temporary problem, or closure such as a maintenance closure of a recipients server. Generally these will be delivered when the problem is removed, but those undeliverable where there is no temporary problem should be “cleaned” out of your list immediately. ISP’s regard high bounce rates as an indication of spamming, and so are likely to take action against such accounts.

2. Delivery rate.

As implied, it is the percentage of emails successfully delivered. Simply the converse of the bounce rate.

3. Open rate.

The percentage of your emails that were opened, pretty obvious. These days, we get so many emails that often we just skim those that appear important and delete or leave the rest, and most of us have our spam filters turned on, so that emails from suspect sources or with suspect subject lines are dropped automatically into the bin. This can easily happen to your marketing email. The best way to avoid it is to have personalised emails, “Dear Fred” rather than just “Hi”, and ask those joining your list to put your email address into their “safe” list in their email account.

4. Click Through Rate.

Often shortened to CTR, this is the number who clicked on one or more of the links in an email message. This measure is one of the foundations of successful digital marketing. When a target or prospect gets something, but does nothing with it, generally the communication will be deemed to have failed. Depending on what you are doing, an expected CTR will vary widely. You could reasonably expect a higher open rate and CTR on a newsletter  that has been subscribed to, than an overtly promotional message, even from a trusted source. There are various techniques used too increase CTR rates, the best ones being an offer of something for free, which is the most common, but surveys work very well, asking for 2 minutes to gather general market or product information generates good click through rates as people like being asked for help when it is anonymous, and simple contests, like ” Which of  these three is out of context” questions also can deliver excellent CTR rates.

5. Sharing rate.

The percentage of recipients who click on the “share this” button to share on one of more of their own platforms, or forward to others. Digital marketers often talk about “engagement”, the necessity to get some level of engagement before anything useful can happen, and sharing is one very useful measure of engagement. Equally, if you get a shared email post or message from a trusted colleague, you are highly likely to open and read it, it is a referral of the message.

6. Conversion rate.

The percentage of recipients who clicked on a link in your email to complete a desired action. It may be signing up to a list to receive more posts, or a move to the next level of a sales funnel, or even straight to  a shopping cart. The conversion rate is the key measure of success of any communication, the recipient has done the action that was the objective of the email.

7. Email ROI.

Pretty self explanatory, but vital measure, and can become complicated when you start feeding in variables. In its most simple form it is the revenue generated by a campaign divided by the number of emails sent. Email marketing is not free, it consumes time and resources, so measuring the return you get on the investment is a crucial activity, and is the one that makes this type of marketing so effective.

Most will have heard the cliché “the money is in the list” from email marketing people, and it is half true. To my mind, the money is only in the list when those in the list take some action as a result of the communication they receive. However, growing your list of engaged and responsive receivers, waiting for your next communication or offer is a building block of ongoing email marketing success.

Need assistance, there are plenty more posts on digital marketing on this site, and there are many others around, mostly trying one of the techniques to get you into their sales funnel. Mine is really simple, call me if a chat would help.


8 Myths of social media marketing that trap small business

social media myths

Myth 1. Fans, followers, and likes are valuable.

Reality.  What you need to attract to your site is people who for one reason or another are willing to part with their money in exchange for what you have, or at least move towards that decision point. There are only two reasons for a website,  the first is as a hobby, the second is commercial. Assuming yours is for the latter, act accordingly.

Myth 2. I have too do it all myself to be “authentic”.

Reality. Only partly  true. If you are selling personalised services, there is some expectation that the voice of the person and the “voice” of the written words and other forms of content are the same, then you need to be involved in the editing, not necessarily the writing.  However, my experience is that in the small business space, authenticity is very valuable, not so much in the corporate space.

Myth 3. You need to be on every platform.

Reality. Bunkum. Every platform is different, with a different user profile, user objective and type of response. Even for big corporations, diminishing returns kick in, and for small businesses, the task is simply overwhelming. I usually recommend to my small business clients 2, at most three, but do them properly.

Myth 4. Social media is not all that important, it is just where he kids go.

Reality. Aren’t kids your current and future customers? Social Media is the greatest competitive  tool ever offered to small businesses, but like any tool, it can be used well and deliver huge value, or it can bite you in the arse.

Myth 5. I can wing it.

Reality. Some can, but they are very organised, have a strategy, and business objectives against which they measure themselves, but this is rare in my experience. Usually  “winging it” means putting a post on Facebook at some point convenient, or tweeting a picture of yourself when at the pub. Both rarely work.

Myth 6. Social media is dangerous and unmanageable.

Reality. Social media can be dangerous when left to itself, it has the capacity to trash your biggest asset, your brand, almost overnight. On the other hand, like most dangerous things, it can be tamed and used to your advantage with knowledge, commitment, and skill.

Myth 7. Social media is all smoke and mirrors

Reality. Social media is now highly quantitative, able to give accurate and repeatable quantitative outcomes very quickly and cheaply. It can be reliable and accurate market research on the run, but it is also the first marketing tool to offer an ROI calculation on the investments made.

Myth 8. Social media is just too hard, I have too much else to do.

Reality. You cannot afford not to be engaged with Social media, it opens up the possibility of talking directly to your customers, and their friends, marketing nirvana. It is however, a consumer of considerable resources, and is not free. Many small  business owners do not have the skills so they shy away, but the skills are readily available to either teach you, or as outsourced resources. Digital technology has opened up huge opportunities to free up our time, why not spend some of it talking to customers?


The simple fact is that Social Media is part of our marketing environment, it currently attracts almost half the advertising dollar, is now pretty much the only way to effectively reach large sections of consumers and customers, and for small businesses, is marketing manna from a digital heaven.

How do you  describe your brand?

brands are like friends

image courtesy brandonsteiner.com


People in market research always describe brands in human terms, they are tough, or easy to live with, or friendly, cold, and so on.

It is the easiest way to describe them.

It follows then that when thinking about the dimensions of your brand, you would do it  using “the brand as a friend” as the guiding metaphor.

Ask yourself a few simple questions:

  • What do your customers expect from your brand?
  • What changes would customers accept from your brand?
  • What will customers reward your brand for delivering?

When you can answer them accurately and confidently, you will have a very good picture of your brand.

A while ago I was yarning to the Mum of one of my oldest friends, we met at University, 40 years ago. She was expressing delight that after 40 years Dave and I were still mates. May not see each other for quite a while, but it made no difference at all when we met up again, it is as if it was yesterday we last shared a coffee. (more often a beer)

My response was that old mates are the best mates, because there were few expectations, few surprises, and when they did show up, there were insignificant in the context of the long relationship.

Same with brands.

How would you describe yours?

Self-induced brand catastrophe


All those brand stories: gone.

All those brand stories: gone.


Every now and again I see something so stupid, so irrational, and so destructive of a valuable brand, that I think that perhaps the loonies really do have the keys to the asylum.

One of them happened yesterday.

There was a radio news report that Akubra would cease to buy any of the raw material required for their hats, rabbit skins, from Australian suppliers.

From here on they would be using 100% imported skins.

One of the honchos from Akubra was interviewed, and he was blathering about looking after all stakeholders, that sacrificing 4-5 jobs in Kempsey where the hats are made was worth it to ensure the business remained viable, and that the 5,000 retailers around Australia needed to be assured of continuous supply, or they would be in trouble.

Blimey, stone the crows, 5,000 retailers rioting because there is uncertainty about the viability of a supplier of .00000001% of their sales.

Then it turned out that just 10% of current skin supplies were local anyway, as the khaleesi virus has cut a swathe through rabbit numbers, for which we are all thankful. Then a supplier was interviewed. He breeds rabbits for the table, the skins to Akubra are a very useful addition to his cash flow, important even, but not make or break, so now the skins will go to landfill.

How much better it would have been to set about supporting the Australian industry, modernising their equipment, working with their suppliers, so that this Australian icon could continue  to grow, particularly as wild rabbit numbers seem to be increasing as the virus becomes less effective.

What a positive brand story they could have created and spread, reinforcing the existing position, telling the stories that are the foundation of their brand, but instead they chose to trash their brand, built up over 100 years plus.

Your brand is an amalgam of all the stories told about you, your products, the situations encountered, and the experiences users have with the products. The stories Akubra could tell are legion, but instead they choose to self-destruct their most valuable asset.

Next thing you know, a global brand like Coke will replace itself. Oh, poop, they already did.


Let the loonies go free.


Why create value before you make a sale?

Free works

Free works

It happened again last week.

A client asked why I advocated giving away a lot of information on their products and supporting technology, seemingly for free off their  website. For them it is a challenging idea, one that runs against everything they have ever thought or done.

Their products are challenging, technical products, heavy in intellectual capital, so why give it away?.

To answer, I created the following list, and it is all about creating value before asking for the purchase order. Do it well, and customers do not have to be sold, they become buyers.

Provide assistance. Information assists potential customers to recognise that they have a problem, an opportunity, or that there may be a better way of approaching a situation.

Demonstrate. By demonstrating how their problems will be solved,  enabling comparisons, and offering technical and financial case studies, the cost/benefits of a purchase can be more easily calculated. This makes the internal purchase approval processes easier for those charged with their carriage in a customers business.

Risk identification. Risks of adoption, and non-adoption can be articulated, demonstrated, and often costed and compared.

Learn. Information offers a prospect the opportunity to learn without the costs usually associated with learning, and they will not forget the opportunity.

Decision necessary information. Availability of strategically significant information from a supplier can accelerate the adoption and implementation of new products and processes, delivering a market benefit.


For my client, the list of benefits is as significant, and in this information driven modern commercial world virtually a competitive necessity.

Be expert. We will be seen as the experts in the market, and who would want to buy from an also ran?

Cycle time. It has the potential to shorten the sales cycle by removing some of the steps normally associated with such B2B sales of significant size

Conversion cost reduction. As a result of both of the previous items together, our cost of conversion from random and often unknown prospect to a transaction is likely to be reduced, and the numbers increased leveraging the costs of our sales effort.

Short listed. Information availability increases the chances that at least we get onto the short list of those who are considering making a purchase, but who may not be in our immediate sales radar.

Sales funnel information. Downloading of various material by prospects gives us not only information on who is in the market, but what they are looking for, and leads on their specific interests and concerns.

Build a brand. The biggest benefit of all is that of the building of the brand, the position of expertise in the market. In this day of ubiquitous information, being seen as the expert in any domain is a hugely valuable asset.

Being secretive, and believing that information held closely is power is now a failed strategy. It worked in the past, but no longer. Information is still power, but the way you leverage it has changed radically.

6 essential questions underpinning digital strategy development


I find myself writing a proposal for the development and  implementation of a digital marketing strategy for a bunch who know they need it, because I suspect their kids told them, but have no idea what it is.

Part of the challenge is to figure out how to balance the digital and social media education against the tough realities of marketing which have not changed despite all the new tools. The entrenched view that marketing is about putting out a monthly newsletter full of general bluster and crap and discounting as and when deemed necessary, usually from an inflated starting point pervades the thinking, and has contributed to ensuring the previous efforts in the digital space have failed.

Perhaps I am wasting my time?

Some of the essential early questions are proving to be challenging for them. Questions like:

1. Who is your audience? We need much more than generalised demographics, we need specific behavioural information informed by the demographics to the point of being able to give prospects individual personalities which we can address in communications.

2. Why and where do they spend their time online? The prospective audience all have digital lives, and if we are serious about becoming a part of those lives, we need to be serious about understanding how it works on an individual basis now, or we risk alienation.

3. What do you have to say? Unless  what you have to say is of interest to them, sufficient to engage and over time lead them to a transaction, there is no future. Speaking to a prospect in their words, explaining why should they care about what you have to say is now essential.

4. How does what you have to say add value to their lives? It is one thing to be noticed, and hopefully gain some interest, but unless we can tell them specifically how the item being promised will add value to their lives, they will not engage. Long gone are the days of broadcasting generalised features and standing back with an order book. Now we have to specifically target benefits and articulate  them unambiguously and with sensitivity to the aspirations, situation and needs of the prospect.

5. Why are you reaching out to them? The initial and quite reasonable and logical reaction to digital communication is that you are just trying to  reach them to flog them something, and nobody likes to be a target. Describing the payoff to them in their terms is essential.

6. What results are you expecting? Knowing the end you are seeking is pretty important. This is not just the end point of the whole process, but the end points in all the building blocks in the engagement to transaction process. The practise of marketing has been revolutionised by the ability to collect and analyse data. For the first time we can now identify which half will be wasted and eliminate it.

Todays digital consumers are pretty savvy, cynical and can smell a con a mile away. However, they are also able to see the intention behind the tools and the benefits that can be delivered to them by the tools, and are comfortable with the trade-off if it is of benefit to them.

A bakers dozen routes to small business success.

13 routes to success

13 routes to success


Small businesses have few resources, so they need to get a lot of mileage out of what they do have.

How do they generate successful marketing campaigns that generate revenue and a long term position in a market without breaking the bank?.

Following are 13 ways that I have found to be successful in 20 years of advising small businesses. It is also fair to acknowledge that 20 years ago, the astonishing range of tools now available were barely in the minds of science fiction writers. There has been a revolution, and small businesses suddenly have the opportunity to look like and act like large ones, while retaining the advantages of being small.


1. Hone your elevator pitch

You need to be able to engage a prospect in a very short time, sounds easy, but is very hard. The pitch is rarely about the product or service you have, although this is the subject of 9/10 pitches, the successful ones are about the outcomes your product can deliver to the prospect.


2. Collaborate.


Small businesses have great opportunities to collaborate with others with complementary products and services. The shoe shop with the dress shop, the florist with the liquor shop, the chiropractor with the gym, and so on.


3. Leverage social media.


I am often asked about the value of Social media, and can only respond by observing “that is where your customers are, so why would you not be there?”. However, managing social media can however become a burden if you try and do it all yourself. Listen to and believe many of the pundits with a silver bullet to sell, and you risk finding yourself lighter in the wallet, but no further forward, but trying to do it all yourself consumes considerable resources. The advent of digital marketing tools has  not changed the basic foundations of marketing at all, just made them more accessible, and so outsourcing the bits you do not know how to do offers great opportunities for leverage.


4. Have a digital presence beyond a Facebook page.


If your marketing effort is all about Facebook, you have missed the boat. Facebook is a fantastic way of connecting, but it is only one, and it is not the best place o transact business, or cover the final step prior to a transaction, that is best done on a website. Social media delivers a set of great tools to drive people to a website, and start the process of engagement, moving them through a “funnel” towards a transaction, but it is only one of the tools needed. Refer above.


5. Foster creativity


The management structures of large  businesses are designed to ensure the repeatability of process, so that they are not dependent on the knowledge and commitment of individuals. Therein lies their weakness, as another way of looking at a process is that it delivers multiple opportunities to say  “no”. Find ways to foster the creativity of those in your networks, or out of them currently who have expertise and knowledge that can be applied to your sphere of operations.

Network relentlessly. Get out of the building, create networks and friendships that know about your businesses, what it does, its “Why” and it will enable over time organic growth.


6. Open envelopes.


A colleague of mine once said disparagingly about a mutual acquaintance that he would “go to the opening of an envelope”. On talking to this bloke on another occasion, he laughed and indicated that it was right, so long as he could wield the letter opener, meaning, he had an opportunity to put a point of view, and be the focus of some attention, even if only for a moment. I always thought it a good idea to take every opportunity to speak,  as it builds credibility, and as a result, builds a business organically. It follows that you also need to be a competent public speaker, so if you are not, get some training, or opening envelopes at the local “toastmasters” group would be a good idea.


7. Seek referrals.


The most powerful marketing is word of mouth. When someone we trust tells us that a particular product or service is good, we tend to believe it, and will try it out when the need arises. Referrals are now hackneyed, as many web sites have them from people we have never heard of, and often we think  the site owner probably wrote his own, but that does not diminish the power of the personal referral. Seek the personal referrals  out, ask for them, post them, and build “social proof” in other ways.


8. Be the expert.


Whatever is your niche, make sure that you present yourself, and indeed are, an expert. The world is full of experts, but for a small business, if you are the expert in your local area, and those around who may need you understand you are the expert, who will get the business as it evolves?


9. Build relationships.


People buy from people, not businesses. I know that sounds odd with all the stuff being sold on line, but look at  the sites that are successful, beyond the mega sites like Amazon and Alibaba, they all have a human face, and a personality.  You might be sending your money via a credit card to a business you are not familiar with, but 9 times in 10, you would have looked at the profile of the “face” of the business, looked at the products they sell and endorse, sought some sort of social proof.  You get to feel that in some way you know  them, then you might buy. An old mentor of mine used to say, “Success comes to those who build many bridges, and never burn one”


10. Localise.


 Most small businesses are local by their nature, be sure that your customers know where you are, that they can get their hands around your throat if necessary,  but more importantly have a  cup of coffee with you wen all is going well. Local, and the human touch that brings is enormously valuable. Even large businesses are localising. I rang the customer service lines of one of the banks recently, with a complaint, something they had done which had (presumably) unintended consequences on me, and I was nit happy. The first call was answered by a call centre, clearly not in Australia, the first hand-off was to the supervisor, again clearly nowhere near Australia, by which time I was getting really annoyed, but the third was to someone in a local call centre, who handled the problem quickly, easily, and in a language we both had as our first.


11. Offer incentives.


 Most times these words are uttered, the first thing that springs to mind are discounts. These may play a role, but are far from the only ones. Time limits, quantity limits, guarantees, freemium, there are all sorts of incentives that do not require you to make a sale at a discount, many of  them when used creatively will actually increase your conversion rates by adding some urgency to the selling process.


12. Everyone is in sales.


In every business, particularly small businesses, everyone in the business needs to recognise that they are in sales, that their job relies on selling, irrespective of the title they may have on their business card. This particularly applies to some of the marketing people out there who seem to think their job ends before accountability begins.


13. Promise the world, then deliver + Mars.


Under promising then over delivering used to be an effective strategy, but it has lost its gloss. Promising the world is easier than ever, and there are more people than ever making those promises in your space. Today you need to be known as the one who promises the world, like all the others, but then delivers with more than was promised. In effect it is an over delivery on the expected over delivery.


If you can do all of these, even a majority, the world is your oyster.

4 essential pillars of digital success


Customer profile development

Customer profile development

It often happens at events at which I speak, big or small, does not seem to matter.

Someone afterwards comes up to get some advice on their particular scheme  to make a million from an online business.

It happened again last week, one very sensible business idea that has been road tested and while sort of working, is sputtering, and a second that is as likely as the second coming to deliver salvation.

The advice I give always starts at the same place, the 4 core questions that need to be asked before anything else:

Who is your ideal customer?

Where can you find them?

What is it that you can deliver to them that will attract them to you?

What result do you want to give them?


It is rare that anyone I speak to has really thought through all four, indeed rare that even the first is clear, but without that discipline, you may  as well keep the money you would give away chasing the dream.

It is reasonable to start with a view, and after testing, alter it based on what you have learnt, but let’s take them one at a time.

Who is your ideal customer?.

In the pre digital age, all we could do was describe our ideal customers in very broad demographic and assumed behavioural terms, now we can be extraordinarily specific. We have also broken the bounds of geography, our customers can be anywhere in the world, and we can reach them. Bombarded as we all are with messages, unless a message speaks specifically to us, about something of immediate interest, we no longer see it, the auto spam filter between our ears screens it all out. In the event your million dollar idea has more than one ideal customer, do the exercise twice, be prepared to have two, or three, or four, sets of ideal customers and the messaging that is specifically relevant to them researched and prepared.

Where can you find them?

This question is not about geography, but about our digital lives. People with similar preferences tend to stick together, it was always so in the school yard,  and it is the same in our digital lives. My eldest son is a specialist in old fashioned large format, black and white, architectural and landscape  photography. His peer group around Sydney is pretty small, in Australia modest, but his global network of like minded specialists and hobbyists is substantial. You will find him in digital places that accommodate those particular specialists, and if you want to talk to them, the way to do so is to go there digitally, and say something of specific interest. Unless you can identify and deeply refine the profile, you will never find him, or anyone else who might buy your idea.

What can you deliver that is attractive to them?

Our range of choices of goods and services and their providers is vast, what is it about you and yours that is likely to be attractive to a prospective customer? To continue the analogy with my son, if you just knew he was a successful photographer, and you sold top end photographic equipment, you might think he was a prospect. No so. You need to be able to deliver him something specifically about his form of photography that is unavailable elsewhere, and that he is currently thinking about, or could be enticed to think about, before he will even notice a message from you.

What result do you want to give them?

Everyone to whom you try to sell something recognises that you are doing it for profit, not your health. While they may be happy to see you healthy, they will only buy from you if there is something in it for them beyond the warm feeling of making you successful. It is therefore essential that you define the result that your prospect will get from using your product. Again using my son, it would be attractive to him to find a large format camera and tripod setup that weighed less than the many kilos of his current setup, which he packs onto his back as he walks long distances to get just the right aspect and light, but any sacrifice of image quality, and his standards are extraordinarily high, would be absolutely unacceptable as a trade-off.

When, and only when you have thought through all this in detail, will you be ready to seriously contemplate an investment in the digital technology and content creation necessary bring your dream alive.



What does the emerging FMCG landscape look like?


retail crash test dummies abound

retail crash test dummies abound

Watching the rather sloppy way Grant O’Brien was moved on by Woolworths last week, I got to thinking about all the converging things happening that will impact the FMCG landscape over the next few years. A superficial look would suggest that things are pretty set, and change that happens will be incremental,  but a closer look would suggest there is a lot of paddling going on under the surface.

These are the things I see:


Coles resurgent. 

In the 40 years I have been around, I have seen the pendulum swing a couple of times, and it looks like Westfarmers have pulled off another mighty swing with Coles. Across pretty much any parameter you choose to look at, they are catching or have caught Woolworths, and remain on the improve.

Woolworths momentum.

In this high fixed cost retailing game, momentum is a huge contributor, not just to the financial outcomes, but to the day to day operations and shop floor “feel”. The momentum seems to be all against Woolies now, after enjoying the benefits for a long period. Their failure to drain cash from Coles by putting pressure on Bunnings with Masters has not just  crunched their financial results, but it seems to have knocked the wind out of their confidence at the sales face across all their formats except perhaps Dan Murphy’s, which seems to be bucking the trend. Woolworths do not have a player in the office supplies game, which must be hurting them, further draining competitive resources.

Discounters are winning.

Aldi is doing really well, opening stores and taking share hand over fist. I have not seen the figures that would substantiate the notion that woolies are losing more to Aldi than Coles, but it would not surprise me at all. On top of Aldi’s blitzkrieg, it seems that their German competitor Lidl is coming. Lidl is a potent long term competitor with substantial experience across many markets.

Costco is seemingly carving out a niche, although not as aggressively as was first forecast, but the crowds in the Costco store at Auburn in Sydney would suggest they are not going away any time soon.

The $A.

After a period well above US $ par, the Aussie is back to more like its long term position. However, the carnage wrought by those few years on the mid sized supplier base cannot be turned around. Retailers by going offshore when they could and leaving their local supplier base to contract will have a continuing impact, as now the dollar is sensible again, there are few suppliers left  with the wherewithal to be reliable national suppliers. It is also clear that those who have survived are a pretty resilient bunch, and are disinclined to replace their eggs back in a basket they cannot control.


Coupled with the carnage of the high $A, the retailers strategic decision to rationalise proprietary SKU’s and replace them with tiers of housebrands to capture the proprietary margin has further led to the rout of the mid sized suppliers. Those left who might be inclined to chance their arm are generally not large enough, and lack the sophistication to manage a business relationship with a major retailer, but some will probably go broke trying.


Many FMCG suppliers lose money on most sales to supermarkets. The negotiating power of the retailers, resulting trading terms and promotional guarantees that enable retailers to never pay beyond the discounted price, while restraining top line price increases to compensate  has led to the situation where only a madman or the financially illiterate would stake their house on success in FMCG.

Innovation avoidance.

Markets evolve with innovation, but the barriers against success are so large that risk avoidance is the priority. Suppliers trumpet a new pack colour scheme as an “innovation”, and retailers get serious by asking the few second tier suppliers left to copy the proprietary market leader for yet another housebrand “innovation” . Retailers think they are good at innovation, but the experience from around the world as well as locally is to the contrary.

Promotion as marketing.

Continual price promotion only erodes the value of a brand, but brand building is a long term proposition, while staying on shelf is an immediate priority. Guess which wins, and we are rapidly approaching a brandless future beyond the few global mega brands that have the grunt to stay on shelf while spending with consumers to brand-build. Marketing budgets have been consumed by promotion spend. We have a generation of marketing people  who have never experienced or even seen real marketing in FMCG.

Wholesale death.

Metcash as pretty much the last man standing is being squeezed by overheads and competing access to consumers outside the major chain supermarkets. Their recent financial results demonstrate the challenge of being the middleman in an environment where it is increasingly easy, and there is increasing motivation to go around the middleman. They seem to be trying with IGA, and with some success, but the local positioning of IGA mitigates against the mass merchandise wholesale business model they operate.  Nevertheless, I do see IIGA as a potential bright spot for smaller suppliers who are unwilling or unable to service Woolies and Coles.


Amongst the doom and gloom, I see several bright points of opportunity.

  • While the traditional marketing strategies no longer work, it remain a fact that it is consumers who actually put their hands in their pockets to buy something. Retailers are just a choke point in the system exercising control, and the emergence of digital marketing offers small businesses the opportunity to engage and motivate their consumers to ignore the predations of retailers and express their purchase preferences with their money.
  • The shortage of retailer suppliers may lead to a loosening of the noose around those remaining, and open opportunities for them to focus on a niche to deliver a product offer that the retailers do want, but that is hard to copy effectively. Combined with digital marketing, there are opportunities to engage with consumers in ways not dominated by price promotion and generic substitution.
  • Local suppliers with a following in a region do have an opportunity to build a business. Coles have been playing with this for a while, and it does work, although the model of local supply does not sit very comfortably alongside the national supplier mentality that exists.   For retailers to really get behind this opportunity to nurture “local”  they will have to wear an increase in transaction costs, as well as make exceptions to their trading patterns. The big blokes may not, but there are real opportunities in the independents and non chain retail segments.
  • Niche retailing will boom, and suppliers have the opportunity to participate. Harris Farm in Sydney continues to rise and rise, and even Thomas Dux, owned by Woolworths but operated largely separately are harbingers of the future. Consumers are increasingly engaged in their retail food shopping, they want their concerns and individual tastes to be met, and that cannot happen in a mass retail outlet focussing on discounting and housebrands.

I am sure there are thoughts I have missed, and would welcome feedback on them as well as comment on those above.

The 4 strategies to scale a small business.


courtesy www.myob.com.au


Most businesses want to grow, even just a bit, it is not only in the DNA,  but some scale makes life in most areas easier. So how do small businesses go about it?

4 basic strategies.

1. Empower the team.

Make every front line person as well as the office realise that their input and customer service is essential. It can be done, and it works. Bunnings is king of the hardware space, delivering great outcomes for Coles, whereas Masters has been a disaster for Woolworths, yesterday claiming the scalp of the MD Grant O’Brien. I shop at Bunnings a lot, drives me nuts, but at least their  people their have product knowledge useful to a casual renovator, share it with you and smile. My two attempts at Masters have been different, and there won’t be a third. Whilst these are both large businesses, it is no different for a small one. Make everyone aware of the 8 moments of truth, and committed to improving them on each interaction that occurs.

2. Critical processes need to be documented.

This is not just to pass the various audits haunting us, but so that employees and everyone else knows what is important and what to do. Documentation makes for robust repeatable processes. The challenge becomes one of continuous improvement, as once a process is documented, it sometimes takes on a persona as being “done”. Within continuous improvement lurks the obvious but often overlooked fact that to improve you first need a stable, measured processes as the starting point for improvement. Documentation provides that starting point.

3. Automate repetitive tasks.

If the same thing is done regularly, in the same way, automate it. Then  you get accuracy, reliability and cost reductions, and who does  not want those. Often there is a cost up front, but taken in the context of the potential savings and productivity improvements they are usually small. The most common automation target is customer service. It can be very successful at stripping out costs, but go too far and customers go somewhere else.  A “learning” FAQ function makes great sense for many, and make sure you do not lose the opportunity for the personal touch.

4. Make everything searchable.

Documents, emails, social media posts, everything that gets done should be in a central repository searchable by anyone when it is needed. The waste of having documents in silos is enormous, unnecessary and just plain stupid in this day and age.

The technology is now such that it is possible for small businesses  to be significant global players in a narrow and deep niche should that be their objective, but even for the local businesses without those grand aspirations, scaling operations is a key consideration in the quest to maximise that other most important resource, your time.


Why do 9/10 new FMCG products fail?

innovation failure

Wheels still on?

There are lots of reasons, I have heard them all, and even used a couple myself, but blaming the retailers, engineers, competitors, lack of advertising, or the weather misses the essential truth.

The process is flawed.

We know the constraints of the retailers, they set the rules and suppliers have to live with them. We cannot control the competition, although mostly they are pretty predictable, and resources for advertising are never enough. Our engineers and designers are ours, so we can get the best out of them, if we are good enough, and we cannot predict the weather, let along control it.

The thing we do control, but rarely leverage well is the innovation management processes most of us use.

If  9/10 products fail, surely there must be something wrong with the logic and processes that allowed them to progress through the system to launch, consuming precious resources as they go.

They get spat out, launched, fail, and we blame everything but the stray dog around the corner, and our NPD&C process.

Silly really.

Why are the processes flawed?

There are standard operating procedures taught with minor variations almost everywhere, they are logical, sequential, and like economics assume knowledge and insight. Nothing like the real world really.

Following is a list of the failure-drivers I have seen over the years.

The ideas are narrow. Ask yourself where most ideas that get into the system come from.

  • Customers. In many industries, solving a customer problem is a great source of ideas, but in FMCG, customers or as we should call them, buyers, have little idea beyond ways to save a few bob, or copy something else that is doing OK, but they have the shelf space to rent, so we bend over.
  • Consumers. We spend millions asking consumers what they want, then trying to interpret the answers in some coherent way, when the truth is as it always was, consumers do not know what they do not know. Henry Fords quip that had he asked his customers what  they wanted, they would have answered a faster horse, still holds.
  • The bosses wife. Always a good source of ideas, mostly crap, but carrying considerable weight in the system.
  • Your sales force. There can be the gem hidden amongst the dross, but usually they are responding to what their customers  (read buyers) tell them, what the opposition has done to pinch a shelf facing, or just looking for reasons they are behind budget. Good sales people are usually pretty focussed on the things that make a difference now, not next year or next decade, so at best they may come up with a useful range extension.

The business case. I am in favor of rigorous planning and being held accountable for results, but when you think about it, our ability to tell the future is pretty limited to non-existent, but we persist with executing on a business plan because it is, well, the plan. Every business case I have ever seen has two common features:

  • A positive forecast of outcomes. Profits, market share, volumes, whatever it is, the forecast is for great things.
  • Detailed cost analysis. This includes the costs to manufacture, buy shelf space, promotional programs, advertising, research, and all the rest. Again, all if we are honest with ourselves, factors we can only really take a best guess at. The only thing we know for sure is that the forecasts will be wrong.

We believe our own bullshit. Because we have spent all that time, effort, and money creating a business case, we then use them to prioritise the options on the basis of the best returns.

We fail at articulating the product. Every successful product I have seen has some essential component that both makes it different to anything else around, and in the process adds value to sufficient lives for there to be an incremental source of new demand. If all we do is cut the existing cake differently, the only winner is the retailer. Somehow we need to make the cake bigger, find that new and elusive consumer demand.

We fail to brief designers. This follows the previous failure, we stumble at articulating the product specs against which the technologists, engineers and creatives have to execute. If we do not know, how can they? Besides, they are usually brought in too late in the design process, they respond to the performance specs marketing tells them the market wants, instead of being a proactive part of designing the specs. This usually ensures that few operational or technology innovations get a guernsey.

Momentum. Once a project starts to move along, it builds momentum, garners support in all sorts of places, and becomes a “project” to be completed, rather than an expression of new consumer demand.

The net result of all the above is that the biggest risk is at the end, when the sunk cost in resources and ego play against anything other than a gung ho launch.

So what is the solution to all this waste, apart from just getting better at fortune telling?

Take some lessons for  the “lean” movement, the operational implementation of the scientific method.

Iterate in small steps, get a few consumers involved early in a hands on way to see of if your value proposition is sound, do a series of small experiments testing hypotheses, and be prepared to be wrong, and alter the approach. Deploy genuine cross functional teams from both inside and outside the organisation, engage in constructive “devils advocate” thinking, and most important of all, have a strategy for the business that drives the new product development process to contribute to the  strategic outcomes, not just the forecast sales and financial ones.

None of this is easy, but that is why there is so much upside, the corporate clones cannot see the opportunities. It is also why increasingly, small and medium business has an advantage over the corporate behemoths that dominate the landscape. They are able to take quick decisions based in instinct, experience, discontinuities that emerge, and an intimacy with customers large businesses can only dream about.

Call me when I can help.