Learning from Big Boys

MyFax: Success by Improving an “Outdated” Product

2009-07-06T22:18:00.003-04:00

MyFax, the Internet fax service provider, has proven that you don’t necessarily have to invent an entirely new product to be successful. Instead, you can use the old and turn it into something new. MyFax took an old technology - faxing - and made it work better by allowing users to send and receive faxes on their PCs, laptops and PDAs rather than having to use a fax machine.

Joseph Nour and Simon Nehme started MyFax in 1997 using their own funds. One of the reasons they chose faxing was they realized nearly everyone else had discounted it. Keep in mind that 1997 was about the time that email was being hailed as the “killer app” for communication. The conventional wisdom held that faxing was obsolete, and would soon be completely replaced by email.

Yet Nour and Nehme saw that fax machines were being sold at a higher clip than ever, and more pages of faxes were being sent than ever. The big limitation, though, was the fax machine itself.

Nour and Nehme realized that faxing through a machine that was tied to a phone line and fixed to one place didn’t fit the changing business atmosphere, which was more focused on mobility and “computing everywhere.” So they developed the technology to allow users to send and receive faxes through their PCs, laptops or even mobile devices from anywhere they could get an Internet connection.

They weren’t the only ones to come to this conclusion. When they started there were a lot of little Internet faxing operations. Most, however, were little basement operations with questionable customer service at best. So MyFax distinguished itself by investing in technology and creating a world-class customer service operation. Today, you can call their help line 24 x 7 x 365 and speak to a live human being who knows the product inside and out, and will help you solve any issues. You can also email the company or use their online chat function to get answers.

From its humble start, MyFax has grown to more 220 employees serving more than 300,000 subscribers, and they’re looking to add more of both. The parent company, Protus, is now a $50 million business (according to published reports) with two other products as well – my1voice, a virtual phone service for small business, and Campaigner, an opt-in email marketing campaign management tool for small business. It is headed toward 40 percent growth this year.

One other thing of note is the pricing, which has made them fairly recession-proof. A basic MyFax account costs just $10 per month. Companies that need faxing capabilities even now and then aren’t going to look at a $10 a month expense first. Those who fax every day (and there are lots of them) consider it an essential part of the business. They’d no sooner cut their MyFax account than their phone service – especially when it’s actually less expensive to keep MyFax than to bring in another phone line.

As MyFax has shown, it is important to understand the trends and create a business where the market is headed. MyFax saw the need for an increasingly mobile workforce to be able send and receives faxes when they’re away from the office, and then built a successful company around it.

How to Succeed on the Web: Best Practices for Online Retailers

2009-06-18T14:56:00.002-04:00

Larry Freed, the head of ForeSee Results which is a market leader in customer satisfaction management, recently spoke at the the Internet Retailer Conference and Exhibition in Boston. In his speech, he gave 6 best practices for online retailers.

Satisfaction drives conversion, loyalty retention, word-of-mouth and financial success.
The consumer is in charge — which speaks to low switching costs, high competition and increased consumer knowledge.
You can't manage what you can't measure. This basic theory applies to every management scorecard.
Measurement is hard; don’t fall for gimmicks.
Integration of Web metrics magnifies value.
It takes only two things to survive and thrive in this economy: Be fiscally responsible, and satisfy your customers.

How Big Businesses and Business Gurus Use Twitter

2009-05-19T21:30:00.008-04:00

Twitter is a social messaging and microblogging site where you can post messages in 140 characters or less. The site has grown at a phenomenal phase, growing at a staggering 1,382 percent on an annual basis.

As such, it is not surprising that both celebrities, businesses and gurus have immersed themselves on Twitter. Businesss use Twitter to communicate with their customers and target market, alert users of deals and promotions, provide customer service, expose Twitter users to their content, and drive traffic back to their website.

Pete Cashmore, founder of the social media guide website Mashable.com, is ranked #27 in Twitter with 670,666 followers. All of his Tweets are Mashable posts. But instead of just repeating the title of the article, he often adds his unique spin to drive more interests -- and clicks -- to his posts.

Cashmore's tweeting is also a good example of how to brand your business in Twitter. He uses the business name "mashable" as his Twitter name, while giving his business personality and face by putting his name and photo in his bio page.

Guy Kawasaki, author of several best selling business books and venture capitalist, has about 123,075 followers. His Twitter posts typically combine a useful or interesting news items from various sources, with a link back to his website. In each post, he almost always put in a "see also" referencing his RSS aggregator site alltop.com. It's a clever way to market his website without being spammy.

Tony Hseih, CEO of Zappos.com, is ranked by Twitterholic.com as #36 with 628,707 followers. In one interview, Hseih revealed that his company doesn't look at Twitter to drive additional traffic. In fact, his posts are mostly his personal thoughts, updates of his day, events at the office -- instead of straight out promoting Zappo.com deals. Twitter for Zappos is more about branding, serving a way customers (and even employees) to see that they are real people. Their goal is to develop personal connection with the Zappos brand.

Zappos.com even offer Twitter training for their employees, and to date, 430 employees are on Twitter including Hseih. The company also has a special subdomain in their site twitter.zappos.com that covers the posts of all their employees, public mention of Zappos.com, collection of pics posted on Twitter (twitpics), and even their tutorial/quick start guide on using Twitter.

How PepsiCo is Using Social Media

2009-05-12T09:35:00.004-04:00

In an article in BrandWeek, PepsiCo's point man for social media Bonin Bough discussed how their company is using social media. PepsiCo is one of the big companies that extensively uses social marketing to push their brand and create meaningful conversations with consumers.

For Bough, the first part of using social media is asking the right questions:

How do we start integrating social media into the overall organization?
How do we look at some common platforms and services that we might be able to use across the organization?
What are some new strategies and platforms that we might explore?
How do we continue to bring those influencer voices inside an organization?

One of Pepsico's efforts in social media is the launching of PepTrends, where top PepsiCo communicators, influencers and Twitter users gathered for a day to tweet about emerging global trends. The Peptrends discussion on Twitter (about 2,000 so far) are exchanged by using the hashtag #peptrends, and the chats focus on "Total Convergence, Local versus Global, and Social Media (and its impact on business, relationships and privacy)."

OfficeMax: How to Use Blogs to Launch a Product

2009-04-14T16:44:00.004-04:00

OfficeMax launched today a new product line by Peter Walsh, a professional organizer from the TLC show Clean Sweep. The product line, called [In]Place System, includes various organizing must-haves such as document wallets and file folders, portable file totes and rolling case files, and color-coded hanging files and expanding files that can be used alone or together as an organizational system. The line will be available exclusively in OfficeMax stores.

For this launch, OfficeMax focused on tapping the blogosphere to get pre-launch buzz for the product line. The steps the company used are:

Reach out to about 250 women's interest and organizational bloggers
Send them product samples in advance
Create a blogcast entitled "Work Life Organized Blogcast," which was a 40-minute live video featuring Walsh and OfficeMax's VP of marketing Julie Krueger.

The blogcast was intended to demonstrate the organizational system to these bloggers. Walsh and Krueger discussed organizational tips and strategies, and how [In]Place System products can be a solution to workplace clutter.

The strategy paid off. The campaign resulted in 65 blog posts, 1,020 Tweets and two YouTube videos, among other posts in the blogosphere. By reaching out to a passionate (and highly targeted) audience, OfficeMax was able to successfully get the word out about their new product line.

Here's an example of a blog post resulting from the campaign:

The focus of this new system is managing paperwork. I hate managing my paperwork but this new system from Peter Walsh actually has me excited to organize and declutter.

Let me tell you why. All the systems fit together, work together, and expand together. You are not tied to one color scheme as all the pieces are transparent, which also make it easy for you to see what it is inside. You can grow your system as you go.

This is the kind of endorsement you'd want from your target audience before your product even hits the shelves!

Lessons on Retailing: Demory's Christmas Memories

2009-04-07T21:02:00.003-04:00

Demory's Christmas Memories is a 10-year old retail store selling Christmas items in Hagertown, Maryland. They don't have a strong Web presence, but their 3,000 sq. ft. store is one of the best of its kind in the Mid-Atlantic area.

In an interview with Selling Christmas Decorations magazine, owner Steve Demory gave this advice that is useful to those running a small retail business:

At first we bought what we liked, and then we realized that we were missing a large segment of our potential customers. We started to listen to people more and make notes of what products they asked us for that we didn't have. We bought more of what people were looking for and our business improved. However, we
don't go for gimmick items that saturate the market and then sit on shelves.

UPDATE (4/26):

Because of a bridge closure on their road from August - December 12, 2008, Demory's Christmas Memories is now for sale. The bridge closure has dramatically reduced the number of cars passing their road until the detour. With fewer cars, their sales also plummeted.

The business has fought the county on getting a temporary bridge put in. The state actually approved it but the County Commisioners voted it down. Given the difficulty in securing financing, the owners have decided to sell their well establised Christmas store.

Costco: Excellent Service Impresses Customer

2009-04-02T21:19:00.003-04:00

A passenger on the train seated behind me was talking excitedly to his friend, raving about Costco. Being a Costco member myself, the conversation piqued my interest, especially since he was talking in this booming voice loud enough to be heard by everyone in our section.

The passenger was excitedly relating to his friend Costco's actions regarding the pistachio nuts recall. His wife received a call from Costco, saying that their records indicate that she had purchased pistachio nuts in the last 3 months. Given the recall, she was adviced to return the nuts to Costco with the original packaging and if possible, the receipt.

His wife said that they have already consumed about half of the nuts, but they have placed the nuts in a jar and threw the original packaging away. Plus, they don't have the receipt anymore. The Costco rep said it's ok - they can put the remaining nuts in a plastic bag and bring it to the nearest Costco, and they will refund her.

The passenger was so impressed with two things:

The granularity of data that Costco has, tracking the items purchased by their members
That Costco had to actually go beyond what is expected of them by calling their customers and making the return easy and hassle-free

This incident demonstrates that excellent customer service makes for happy customers. And happy customers will not just tell one, but several others, of their happy interaction with your business. Afterall, the people in our section of the train heard the story!

The 12 Commandments of Wealth: Learning from Self-Made Successful Entrepreneurs

2009-03-16T21:41:00.005-04:00

W. Randall Jones, founder of Worth magazine, in his new book entitled "The Richest Man in Town: The Twelve Commandments of Wealth"distills the characteristics of successful men and women.

He explores the age-old question of what makes these successful people, all self-made, different from you and me. Being rich and living a prosperous life seem to be a universal desire, but why is it that not everyone can achieve great success and everything it brings? How can you become the richest man in town?

In the course of his career interviewing successful people -- from tech giants Bill Gates and Larry Page to writer Stephen King -- Jones found commonalities among the successful individuals, which he calls RMIT (richest man in town). Here are Jones' "twelve commandments of wealth:"

Seek money for money's sake and ye shall not find = the RMITs believe that you must first create substantial value -- products or services that enhance people's lives -- before the money will flow from any commercial enterprise.
Find your perfect pitch = the RMITs know who they are, what makes them tick, and have mastered the difficult task of deciphering their greatest talents and abilities
Be your own boss = if you hire yourself, you control your own life's directions
Get addicted to ambition = while there is no denying that hard work, dedication and diligence play an important role in reaching the American dream, you need to have the desire and will to be the richest man or woman in town.
Wake up early - be early = risk only increases with age, so RMITs concur that you've got less to risk when you start young, plus you have more time and essential energy to get it done.
Don't set goals - execute or be executed = goals are important and ideas are essential to success , but RMITs knows that wealth creation require a far more essential ingredient: execution. Success depends on the execution -- on the ability to get things done.
Fail to succeed = the only way to succeed is to have the courage to fail. The greatest commonality among RMITs is the willingness to face failure and the resilience to pick themselves up
Location doesn't matter = most RMITs make their fortunes in places they know best, proving that success can take place anywhere an everywhere.
Moor yourself to morals = fortunes without a moral foundation are nothing more than mirages destined to disappear faster than they were created
Say yes to sales = great wealth creation requires great selling skills. RMITs love to sell.
Borrow from the best - and the worst = RMITs are eternal students, with an almost universal interest in reading biographies of other successful people. They strive to stay attuned to new ideas, new and better approaches to wealth creation.
Never retire = RMITs believe that retirement is hazardous to their wealth , and even more important, hazardous to their health.

Learning from Wikipedia and their Content Creation Strategy

2009-02-12T22:26:00.002-05:00

Search for almost anything on the Web -- from foreclosure to oven -- Wikipedia is almost always at the top of the search results (or at least in the top 10).

Instead of getting mad that Wikipedia is hogging the search results, learn the strategies Wikipedia employ to stay on top of the search results. WebmasterWorld.com has a very interesting discussion on how Wikipedia creates content that win in the search engines:

Create content rich definition pages that explain your products clearly
Wikipedia's success comes from people knowing what to expect when they click on the site -- "encyclopedia-like explanation of plausible quality." Since your site is probably not as well known as Wikipedia, improve your landing pages to align users expectations based on what they read in the search engine results and the actualcontent of your site.
Use intra-site links, instead of navigation. Wikipedia uses an intensive intra-site linking strategy where a new page is "linked to (with the key term in the anchor text) from one (usually more) other Wikipedia pages."
Make more -- and more -- content.
Don't be afraid to edit your site, especially if you are creating new intra-links
Create an authority page that attracts links
Whenever you add a new page, skim through the rest of your content to look for ways, even creative ways, those other topics relate to your new page

How to Survive the Recession: Foster Customer Loyalty

2009-02-07T20:43:00.002-05:00

Here's a good tip from Tom Shirkey, Founder and President, Loyalty Advantage published in DM News Magazine (January 26, 2009 issue, page 6) on how fostering customer loyalty can help small businesses survive the recession:
Allocating budget dollars toward existing customers is even more critical during an economic slowdown. In a down economy, loyal customers are your No. 1 asset because they provide the highest marketing ROI. …

Uncertainty has led to increasing cost consciousness. Lower prices, discounts or temporary incentives from competitors look increasingly attractive to price-sensitive consumers. That is why it is critical to reach out to your best customers and reinforce your value proposition. You can provide tailored products, services, messages and offers. The goal is to redirect the mindset from “who has the lowest price” to “who provides the best value.”

How to Select Your Products

2009-01-22T14:20:00.003-05:00

Great tip from Gary Geisler, President/CEO of the $432 million cataloger AmeriMark selling home healthcare products for seniors:

"Our philosophy is, we put items in a catalog and watch what they're buying. If they're not buying it, we don't put it back in the catalog. If it's not making money, we get rid of it. We change with the buying habits of our customers. Customers dictate what they want to buy."

Whether you are selling via a catalog or Web or a store, his merchandising tip makes perfect sense.

Source: "Senior Manager" by Jim Tierney, Multichannel Merchant, Jan 09 issue, pp. 22

Richard Branson: How to Keep a Company Vital

2009-01-03T22:18:00.002-05:00

The quality of your people can make or break your business.

Richard Branson, CEO of the Virgin Group of Companies, confirms this when he shared the keys to his entrepreneurial success in a recent magazine interview (Playboy, January 2009, pp. 39-46):
It all comes down to people. Nothing else comes close. Motivating people, bringing in the best. You assume every switchboard operator will excel, and they will. Often people make mistakes, but you allow for that, too. Praise people --like plants, they must be nurturedc-- and make it fun. Value them and give them the opportunity to contribute in ways that excite them.... Keep it vibrant. Everything comes back to people. Nothing else. You get loyalty, enthusiasm and great service for your customers.

Target.com: How to Create Effective Product Pages

2008-11-20T12:04:00.016-05:00

According to InternetRetailer.com's Top 500 Guide, Target.com is ranked as the 19th biggest ecommerce store on the Web today. From $756 million in 2004, Target's web sales has grown to 1.153 billion in web sales in 2007.

While we do not have access to Target.com's analytics data (though InternetRetailer.com estimates that Target.com's conversion rate is 1.9%), it is worth looking at the changes Target.com has made with their website to boost sales, with this post focusing on the product page.

Below is a look at Target.com's product page for a bed in a bag back in 2005 (courtesy of the Internet Wayback machine)

For a product in the same category, below is the 2008 version of how Target.com currently shows their product:

During the 3-year time period, Target has introduced a number of interesting changes to their product page design. These changes are worth considering for your ecommerce website as well:

The predominantly white space next to the product in the 2005 version now contains product selection choices such as size and quantity. Visitors who know that they have found the product they want can easily order the item without the need to scroll the page down.
Formerly empty gray space separating the header navigation now contains the product category and subcategory listing, making it easier for customers to navigate the product listings
Add to Cart button has been moved from below the fold to above the fold position making it more visible to the visitor
Addition of product review from customers highlight the recent emphasis on community participation.
The 4-tab product information section has been retained though Features and Description were merged (which makes perfect sense), while Additional Info and Shipping Info tabs were retained. A tab Guest Reviews was added.
The shopping cart icon located at the topmost row of the page has been made more prominent. Whereas only the shopping cart graphic was red in the 2005 version, now the word "Shopping Cart" has been spelled out and both the text and graphic are now in a can't miss red color.

There's nothing as "little changes" in web design. Sometimes slightly moving a page element or changing its color can boost the site's conversion rate. Test these changes in your site and track whether the change has any impact on your conversion rate.

Design Toscano: Increasing Sales by Improving Email Response Rates

2008-11-06T10:00:00.005-05:00

One of my favorite home decor catalog/website is Design Toscano http://www.designtoscano.com/ . They have unique home decor pieces that are well priced and beautiful.

Design Toscano was recently featured in a case study entitled "Narrow Niche E-Mails Increase Sales" in the October 2008 issue of Target Marketing. The company traditionally used emails to announce catalog drops, highlight a few items (mostly new inventories), introduce merchandise lines, and announce site-wide sales.

To spur sales, Design Toscano experimented on segmented email blasts. For example, they sent recent subscribers and buyers --as well as those who have purchased merchandise from their contemporary art collection -- email offers for contemporary art pieces. They also broke down their list to send separate emails based on style of religious statuary products (e.g. customers who like crosses, and those who like mystic fairies).

The result is a 400 percent increase in response rate sent with fewer monthly emails.

LESSON: Don't assume that customers are interested in everything that you have to offer. Test, test and test. Segment your userbase to find out what interests them -- and offer those products. The process of segmenting your customer base is not easy -- assuming that you even have a good database of your customers. But taking time to understand what they want can pay off hugely for your business.

Office Max: Effective Product Presentation

2008-10-30T05:30:00.003-04:00

If you are offering a wide variety of products, check out how OfficeMax.com presents its products.

OfficeMax.com is the 6th largest ecommerce site according to the Internet Retailer Top 500 Guide. The company had Web sales of about $3.16 billion in 2007, and a monthly unique visitors of 3.6 million. What is impressive about OfficeMax.com is their high conversion rate -- said to be around 10.75 percent.

One of OfficeMax.com's feature is their methods of making it easy for customers to find what is available on the site:

Alphabetical directory of their product category. Presented as an interactive ruler, a customer can click on the letter and it will show the list of product types starting with that letter -- e.g. clicking on letter J shows janitorial products, journals and jump drives. The ruler is available in all pages to make it easy for customers to jump from one product category to another. This feature is unique among the top etailers

Main product category listing on the left navigation column.

How to Introduce a New Product: Lessons from Sears

2008-10-20T15:12:00.007-04:00

If you are looking to introduce a new product line (particularly high end or expensive products), study Sears.com's way of highlighting a product.

With a new product, your goal is to educate the consumers about the product, how it is used and should be used, and more importantly, what benefits this new product can give the consumers.

Sears.com employs a variety of techniques that effectively showcases their Kenmore Induction Cooking products. Here are their strategies:

Dedicate a page introducing this new product line
Feature the page from the main page, if not the homepage
Pictures are worth a thousand words. Sears.com has a huge picture of the product, with smaller photos of the products in action showcasing its benefits and features.
Provide detailed information about the product in various formats. Sears.com has an informational video, product brochure, product specs and owners manual available right at the top of the product.
Give a clear listing of the product's benefits and features. Sears.com shows a pop-up when the mouse hovers over the benefit/features explaining in detail what the customer can get and experience from the product.
Stress the benefits of the product in the tagline. For this product, Sears.com uses "Makes Cooking Faster, Safer, and More Efficient than ever before" -- with the words "Faster, Safer and More Efficient" written in a bigger and bolder copy
Call to Action strategically placed with "Shop Kenmore Induction Cooktop" below the product description. Instead of using something like "Click here", Sears.com uses the stronger call to action "Shop."
Provide customer assistance to address any questions or queries the customer may have. Sears.com has "Let our Personal Kitchen Advisor help you shop" that conveys the company's willingness to help the customer and hints at the product knowledge of these kitchen advisors.

How to Improve Effectiveness of Your Email Marketing Campaigns

2008-10-14T22:00:00.002-04:00

Internet Retailer conducted a survey of 174 web-only retailers, chain retailers, catalogers and consumer brand manufacturers on how they are using email marketing.

The most interesting result of the survey is the question on the tactics used to improve results from email:

Which of the following tactics are you using to improve the effectiveness of your email campaigs? (Check all that apply)

Featuring the company name prominently in the "from" line = 77.0%
Featuring the company name prominently in the "subject" line = 44.8%
Asking recipients to add your address to their address book = 38.5%
Keeping key points of content above the fold = 72.4%
Strategically placing buttons and links throughout the body of the message = 50.0%
Providing multiple options (for example, opting out of promotional emails but remaining on the e-newsletter list) during the opt-out process = 17.8%
Other = 17.2%
Adding more video related content = 8.0%

Lenox: Listening to Your Customers is Key to Success

2008-09-30T20:35:00.004-04:00

Lenox.com recently redesigned their website to enhance customer experience. But like many retailers, particularly small businesses, they don't know what users really want from their site. It's hard to improve customer experience when you don't know where to start.

The home decor, jewelry, and dining and entertaining retailer then conducted an extensive market study of how customers use their website. They needed to know what their customers want, and what better way to find out than asking the customers directly.

According to Internet Retailer magazine, Lenox hired a market research agency to conduct usability tests with Lenox target audiences, including their own customers. They discovered key learnings that contributed to the redesign:

Customers want to see products of the same pattern, which the site didn't offer. Customers apparently were having a hard time looking for various products using the same pattern.

Customers find it hard to search for their 5,000+ products.

Customers can get "lost" in their category pages -- e.g. when going to the dinnerware category page, left hand section show products from other categories

Lenox spent the next six months redesigning their site. In addition to addressing the problems above, Lenox also used more images and moved the description of products to the right instead of below so customers can immediately learn about the products. A month after the new design was launched, the company saw a 10% increase in conversion.

Lesson for Small Businesses: It is important to actually go out and talk to your customers what they think of your business or website. Don't always assume that you know what they want and what they need; instead, ask them.

Of course the main constraint will be resources. While big boys such as Lenox have the resources to conduct extensive market research, you may not have the deep pockets to hire a firm. So invite friends of friends and ask them to check out your site - whether they find it easy to move around the site or understand your product descriptions or find products they want.

Crate & Barrel: Email Strategies During Tough Economic Times

2008-09-26T20:05:00.008-04:00

As the financial market falls, retailers are gearing up for a bleak holiday season. With financial woes such as the faltering housing market, rising unemployment and high food and energy costs, consumers may cut back on spending for gifts and holidays.

To survive in this market, one way is to emphasize low price gifts that have lots of value (and style). Crate and Barrel's email campaign is a superb example of how this is accomplished:

Recognizing that customers may be tight with money this holiday season, the company sent out to their email subscribers a campagn listing 20 gifts for under $20. In this email campaign, Crate and Barrel demonstrates that:

The company understands that low price will become an important factor in buying gifts.
Beauty and style do not always need a hefty price tag.
With red and white colors, the image reeks of sophistication to convince the customer they can give inexpensive gifts without looking cheap.
Customers can get value for money.

Shoppers will not stop shopping this holiday season despite the economic downturn. But price will be an important factor they will consider. Be sure that your products are categorized by prices, and yes, like Crate and Barrel communicate to your consumer base that your store offers value for their money.

Online Customer Service Success Tips from DrsFosterSmith.com

2008-09-23T21:38:00.003-04:00

eM+C magazine has a good interview with the pet supply store DrsFosterSmith.com on their secrets to customer service success. This 25-year old retailer is renowed for their excellent customer service.

In fact, DrsFosterSmith.com has been named by Foresee Results' Spring 2008 Top 100 Online Retail Satisfaction Index as the nation's fourth ranked retailer in terms of online customer satisfaction.

According to the pet supply store, their secrets to online customer service success include

Think through how the customer will respond to whatever they put on the Web, asking themselves if this will help the customers understand what they are buying and make sure they have enough information to make the right decision.

Only sell quality products, which have been screened by their veterinarian staffers

Have a 100% satisfaction guaranteed, no questions asked

Have a one stop resolution system for the customer, where customer service agents are empowered to resolve a problem within that p hone call.

Have a website review process, where staffers from various departments try to look at their website from a customer's point of view.

Listen to the comments of the customers and pay attention to them.

Focus on making customers, not just sales.

Kazoo Toys: How a Small Business Can Compete with the Big Boys

2008-09-07T21:18:00.005-04:00

One challenge for small business entrepreneurs is how they can compete -- and thrive -- against big businesses in their niche. It is hard and scary, particularly if you have limited resources and cannot afford to make mistakes.

But there are small businesses who are able to carve a niche for themselves and succeed, despite the presence of big competitors. One example is Kazoo Toys, a specialty toy store based in Denver who has now expanded on the Internet through their website http://www.kazootoys.com/ .

Diana Nelson, CEO of Kazoo Toys, purchased the store in 1998 and launched the online store in 1999. The Toy Industry Association awarded Kazoo Toys as one of the Top 5 Specialty Retail Toy Stores in North America in 2003, 2004, 2005 and 2006. It was also voted #1 Toy Internet Site in 2006 and 2007 by Playthings Magazine. A recent post in their website show the email from Inc Magazine informing them of the toy store's inclusion in the Inc 500 listing of top small businesses.

So what factors help this small online store compete with Toys R'Us and other big businesses? From interviews of Diana and other articles on Kazoo Toys, here are what sets this small toy store apart and succeed:

Customer Service, customer service and more customer service: Testimonials from customers repeatedly harp on the excellent customer service offered by the company. One review from a user:

"I do not remember the persons name that help me with my order but I have to say if you could go pass a 5 being excellent she would get that number. She really went out of her way to help me with my order. Thank you so much, I will be shopping there again"

Manage the business well: Cut your controllable expenses, increase your margins and increase your visibility.
Offer something unique in the market: ditch the common products sold by everyone in the market (e.g. Fisher Price and Mattel toys) and offer interesting albeit lesser known products such as Gotz dolls from Germany to innovative new companies such as WaDaYaThink.
Differentiate your brand: Kazoo Toys is building an excellent reputation for offering unusual toys at great prices.
Go for calculated risks: While the retail toy store had good bones, Diana knew the future will be the Web and expanded through this medium instead of building more brick and mortar stores.

Demonstration of Excellent Customer Service from Big Boys

2008-08-18T22:10:00.003-04:00

I've come across the book "Tales of Knock Your Socks Off Service: Inspiring Stories of Outstanding Customer Service" by Kristin Anderson and Ron Zemke." If you want to get ideas of how to provide excellent customer service, this book will inspire you.

Some examples of how the big boys gave excellent service:

Target Stores

A mom and her 6 year old son was looking for a particular "Superman" pajamas in a Target Store in Elgin, Illinois. The boy had this pajama when he was 2 years old, and wanted one in his bigger size. But the Target store did not have any for the boy's size.

A Target employee approached them and offered her assistance. She called up several Target stores to check if the pajamas in the requested size was available. She found the PJs in the right size in another store, which promised to ship the item to the Elgin store. When the mom came to pick up the PJs, she learned that the Target employee personally drove 15 miles to the other store, paid for it with her own money and brought it to the Elgin store -- all in the effort of ensuring that the mom can get the much coveted PJs

Customer Service Tools of Big Online Businesses

2008-08-11T22:45:00.002-04:00

Internet Retailer magazine conducted a survey on the customer service tools used by top online businesses. It is good to look at the results and incorporate these tools in your website as well.

Here are some results from the study:

Which self service tools do you have on your website (check all that apply)?

Order confirmation = 79.3%
Account status/history = 62.0%
Order status = 62.0%
Shipment tracking = 61.4%
Change name, email, address or password = 58.7%
Change shipping address = 55.4%
Change billing address = 54.3%
Estimated shipping date = 40.2%
Express checkout = 29.3%
Currency converter = 6.5%
Other = 19.6%

Which of the following procedures and policies do you include on your main customer service page (check all that apply)?

Contact Us = 90.2%
Privacy Notice = 77.7%
Shipping and Delivery = 76.1%
Returns and replacement/exchange = 72.3%
Payments security = 69.0%
Updating account information = 42.4%
Viewing and changing orders = 34.8%
Gift cards and registries = 29.3%
Other = 29.3%

Many of the above require technology investments. But as more and more people flock to the Web to shop and competition for small businesses getting tougher, it is imperative that your business invests in these technologies and provide most of the widely used customer service tools for your customers.

Customer Acquisition Tips from Trump University

2008-07-29T17:06:00.004-04:00

eMarketingandCommerce.com has a very insightful interview with Trump University's VP of Marketing Josef Katz on how they are acquiring new customers. Trump University offers online business and real estate courses, as well as live training spearheaded by the top names in real estate business.

Here are some of the secrets of their success:

Given that their live events are a large part of how they acquire new customers, they decided to optimize these pages to capture as many new customers as possible. After a series of tests, they found that visitors respond best to bulleted text (instead of long copy) by as much as 16% increase in conversion rate.
Putting in the registration form below the fold after the course description influences conversion by 75 percent as visitors want to read about the course first before signing up.
With regards to social networking, Katz advises that businesses should explore what's out there and spend some time with niche social networking sites that relate to your business. Do not sell, but participate in the site -- make new contacts, contribute, add value -- and people will find you.

Lessons from Failed Web 2.0 Companies

2008-07-14T13:18:00.003-04:00

FastCompany has a very interesting blog post about Web 2.0 companies that failed. With all the success of Facebook, MySpace, Yahoo Answers, Flickr and others, there's bound to be 10x more that failed.

Here are some interesting Web 2.0 failures and lessons you can learn from them:

1. Akimbo = even with raising $56 million from investors such as Cisco and AT&T, this video on demand service suffered from inability to focus and define a profitable business model for itself coupled with management problems.

2. RSS Calendar = this site allowed the easy sharing through RSS of calendars such as Microsoft Outlook. However, with studies showing that only 5-6 percent of Internet users actually using RSS, it is very hard to create a business around a very limited user base.

3. ProtectMyPhotos = when all your competitors are going in one direction, it is a big gamble not to join your competitors and in fact, go against the tide. While all photo sites allow photo sharing, ProtectMyPhotos limited itself to photo backups and photo restoration, with no photo sharing. The gamble, unfortunately, proved to be their undoing and the company closed after a little more than a year of operations.