Tips to become a successful weekend entrepreneur

22 08 2007

Starting a business using just your weekend hours (and maybe even your weekday evenings) can be a challenge–so we went to Jeff Sloan, co-founder with his brother Rich Sloan of StartupNation LLC, an online outlet for starting and growing a business, and co-author of StartupNation: America’s Leading Entrepreneurial Experts Reveal the Secrets to Building a Blockbuster Business, to get the dos of starting a weekend business. Listen up.

  • DOstart part time. Using your evenings and weekends to build a business while keeping your day job is a great strategy. The accessibility of technology and the end of homebased business’ stigma means starting part time is now a more viable option than ever.
  • DObe efficient with your time. It’s important to be completely focused during the precious little time you have to spend on your business. Says Sloan, “The time you spend doing the business needs to be focused, dedicated and serious if you’re interested in real business success.”
  • DOdetermine your weekend business goals. Ask yourself: Do you want your business to be a hobby business? Do you want the business to provide a living for you and your family? Do you plan to grow the company exponentially to reap enormous profits? Making some specific goals will help you plan and target your efforts toward meeting those goals.
  • DOeliminate distractions. Sloan suggests setting up a private, dedicated space in your home for work-free it from distractions like TV or boisterous youngsters.
  • DOstrive for balance. Before you even create your business plan, says Sloan, create your life plan-then you’ll see where your business fits on your list of priorities. “It’s really important to have the discipline to create a balance,” he says. “And make sure you don’t forget other priorities.”

Along with the great many tips on how to start and run your weekend business, we asked Jeff Sloan, co-founder with his brother Rich Sloan of StartupNation LLC, about mistakes to avoid with your part-time startup.

  • DON’Tskimp on technology. Because you’re not there to fix problems right away, invest in top-notch technology (website, e-mail, fax, phone, etc.) to keep things running smoothly when you’re away.
  • DON’Ttreat the business casually. Part time doesn’t mean half-assed-if you’re serious about starting a weekend business, you still need to deal with all the elements of startup: incorporation, taxes, legal issues, employees and insurance, for starters. Says Sloan, “A part-time business is still a business, and it needs to be conducted accordingly.”
  • DON’Tadvertise your part-time status. But you needn’t lie about running a part-time business, either. The truth is, customers don’t care if you’re part time as long as their needs are met. Says Sloan, “What a customer wants is a good experience…. They want whatever it is they purchased from you to be realized.”
  • DON’Ttake on too much business. More isn’t always better-especially when you’re working under a tight time crunch. Says Sloan, “Don’t overburden yourself with so much business that you can’t execute on the promise and deliver to your customer.”
  • DON’Tbe unprofessional. To build your weekend business, make sure your marketing materials (business cards, stationery, brochures, etc.) are all highly professional-looking. Says Sloan, “You want to convey an image of credibility and effectiveness so the customer has confidence in you.”–Nichole L. Torres




The Ingredients of a Marketing Plan

19 08 2007

Every how-to book on the market has a different take on the essential elements of a marketing plan. Those geared toward the big corporate crowd communicate in a language few human beings understand. However, the words you use are much less important than how seriously you approach the task.

This section outlines the key elements you need to include in your marketing plan. No matter how it’s ultimately organized, your marketing plan should be a straightforward, easily understood company document. It should provide you with a clear direction for your marketing efforts for the coming year, and it should give an incisive look into your company for all readers.

Preparing to Write
Before you begin to write, pull together some information you’ll need. Getting the information first avoids interruptions in the thinking and writing process. Have on hand:

  • Your company’s latest financial reports (profit and loss, operating budgets and so on) and latest sales figures by product and region for the current and the past three years or, if less, for however long you’ve been in business.
  • A listing of each product or service in the current line, along with target markets
  • An organization table (If you can count your employees on one hand, you can probably omit this.)
  • Your understanding of your marketplace: your competitors, geographical boundaries, types of customers you sell to, existing distribution channels, latest and most useful demographic data, any information on trends in your markets (both demographic and product-related)
  • Ask each of your salespeople and/or customer-relations people to list the most crucial points, in their opinion, that need to be included in the coming year’s marketing plan. You don’t have to include all of them, but you do have to take them into account.

Market Situation
The “market situation” section should contain your best and most clear-headed description of the current state of the marketplace (this is no place for hunches).

  • What are your products/services or product/service lines?
  • What is the dollar size of your markets?
  • What is your sales and distribution setup?
  • What geographic area do you sell to?
  • Describe your audience in terms of population, demographics, income levels and so on.
  • What competitors exist in this marketplace?
  • Historically, how well have your products sold?

Your market situation section might read like this:

Sumners and Associates is a bookkeeping and accounting firm started in 1981. We provide tax services to individuals and to businesses under $500,000 in annual sales. We provide bookkeeping and payroll support to those same businesses. Our market area is Boulder, Colorado, and its northern suburbs.

For the personal market, our clients typically are in the $75,000 and higher income range, or they are retired with assets of $200,000 or more. For the business market, most of our work is for restaurants, service stations, independent convenience stores and a large courier service.

With the exception of a slump from 1988 through 1991, Sumners and Associates has grown steadily from its inception. Gross sales in 1997 were $145,000.

Competition for our immediate market is a group of eight firms roughly comparable to our company. Only one of these firms, Acme Bookkeeping, has an interest in marketing itself. We believe we rank second in the group of competitors, behind Acme.

We have a strong position in the restaurant portion of our business.

Much of this information exists in the heads of the management team, the way it is at many companies. But now is when you write it down. For example, how much information do you have in your office–right now–on your competition? A marketing plan gives you a chance to pull all this relevant information together in one place, to spur ideas and justify actions.

Consider each of your products or services up against the matching products or services of your competitors. How well do you stack up? Is there any significant market opportunity for you that neither you nor your competitors are currently exploiting?

You’ll also find that the best thinkers in your company may well have different ideas about elements of the current situation. Your marketing plan will provide a good arena to test different snapshots of the market against each other.

Threats and Opportunities
This section is an extension of the “market situation” section, and it should focus on the bad and good implications of the current market:

  • What trends in the marketplace are against you?
  • Are there competitive trends that are ominous?
  • Are your current products poised to succeed in the market as it now exists?
  • What trends in the marketplace favor you?
  • Are there competitive trends working to your benefit?
  • Are the demographics of your market in your favor? Against you?

There are lots of places to go to get information on the trends in your market. City and state business publications frequently publish overview issues; you can talk to local business reporters; and local chambers of commerce publish projections, as do associations of manufacturers (the names are different in various parts of the country). Talk to your professional association and read your trade journals.

Here’s an example of what a threats and opportunities section would look like for the Sumners and Associates firm:

Threats:
The company faces four identifiable threats in the coming year:
1. Our computer system needs upgrading to the latest version of our accounting and tax software. To do this with all of our machines will be too costly. We’ll need to work with the existing version of our software for another 10 months. This may put us at a service disadvantage with some clients.
2. Two of our clients, Porkie’s Carryout and the Magnus Group, are facing difficult business prospects in the short term. We will likely need to replace this business before the end of the year.
3. Acme Bookkeeping, our major competitor, has hired one of our staff members. We have to assume they now have our current client list and will make solicitations based on their greater size and service capabilities.
4. Growth on the south side of town is outstripping growth on the north side. We’ll need to consider opening a south-side office or look into ways to use couriers or electronic communications to make ourselves fully competitive in providing our services.

Opportunities:
1. Morrissey’s Inc., a long-time client, has purchased three significant restaurants in the adjoining county and has expressed an interest in having us take over the accounting work for these operations. This should provide us a great chance to hire one and perhaps two additional people.
2. Changes in the tax laws have made many small businesses uneasy with handling the bookkeeping by themselves or through a one-person bookkeeping service. As the details of these revisions become more public, we anticipate increasing calls for help.
3. We have been asked to participate in several educational venues in the coming year, which include three presentations at a small-business forum, an evening class at the university on starting a small business, and a role in the Boulder Entrepreneur Club. These will provide us good exposure and strong business prospects.
4. The local economy continues to be strong, and we believe our typical clients will continue to flourish in this growth cycle.

In the “marketing objectives” section, you paint your picture of the future: What marketing objectives do you want to achieve over the course of the plan? Each of your marketing objectives should include both a narrative description of what you intend to accomplish along with numbers to give you something concrete to aim for. Just to say you want to make a first entry into the Swiss screw machine marketplace isn’t providing much guidance. Saying you want to go from 0 percent to 8 percent of the local market in two years is easier to understand–and verifiable. If you’re not sure of the size of the local market, then aim at a dollar figure in sales. Your accountant will let you know whether you’ve succeeded or not.

Goal for It
If you’re new to the marketing plan racket, how do you set a quantifiable goal? Start with your past. Review your past sales numbers, your growth over the years in different markets, the size of typical new customers, and how new product introductions have fared. If over the last five years you’ve grown a cumulative 80 percent in gross revenues, projecting a 20 percent to 25 percent increase in the next year is reasonable; 45 percent is not. Make a low but reasonable projection for what you’ll be able to accomplish with marketing support toward your new marketing objectives. Set modest goals to start, until you get a feel for the terrain.

You should make it a point to limit the number of marketing objectives you take on in a given year. Let’s face it, change can bring stress, disorient staff and sometimes even confuse your target market. Keep your objectives challenging but achievable. Better to motivate yourself with ambitious but worthy targets than to depress yourself by failing at too many enthusiastic goals.

Here are some typical marketing objective categories:

  • Introduce new products
  • Extend or regain market for existing product
  • Enter new territories for the company
  • Boost sales in a particular product, market or price range. Where will this business come from? Be specific.
  • Cross-sell (or bundle) one product with another
  • Enter into long-term contracts with desirable clients
  • Raise prices without cutting into sales figures
  • Refine a product
  • Enhance manufacturing/product delivery

This third section of your plan should include perhaps a half dozen such objectives, spelled out with specific goals. Some examples:

  • Objective: Introduce our accounting and audit services to Blankville. By the end of the first year, we want to have six clients of significance and billed time of $75,000.
  • Objective: Reverse the decline in our package Caribbean winter tour sales in Chicago, Detroit and Minneapolis. Sales over the past three years have declined 11 percent. We intend to increase sales 4 percent this year and 8 percent next year.
  • Objective: Introduce lunch fax business at the west side restaurant and deliver 420 lunches per week by June 1.
  • Objective: Demo updated X-ray crystallography at selected trade exhibitions in the summer of 1999. Capture 250 leads per show and secure 75 on-site demos.

To repeat, make your objectives simple, concrete, countable, ambitious and achievable.

Marketing Goals: Where the Details Start
Here’s where you come down out of the clouds and spell out how you’re going to make things happen. While your spreadsheet has shown increasingly stunning profits each time you bump up the market gains, now you’re in the real world. Gains must be made by brains and brawn.

Each marketing objective should have several goals (subsets of objectives) and tactics for achieving those goals. In the objectives section of your marketing plan, you focus on the “what” and the “why” of the marketing tasks for the year ahead. In the implementation section, you focus on the practical, sweat-and-calluses areas of who, where, when and how. This is life in the marketing trenches.

When Eisenhower and the Allies decided to invade Normandy in 1944 to open up a mainland Europe offensive against the Axis powers, they developed detailed plans for victory. While successfully landing in Normandy and holding it were the overall objectives, many intermediate goals were set to make this possible: lining up the needed boats, air cover, behind-the-lines paratrooper drops to cut off communications, feints at a Calais landing to fool the enemy and so on. And, of course, each of those steps had its own list of details.

The key task is to take each objective and lay out the steps you intend to take to reach it. As an example, let’s take the first marketing objective mentioned

Objective: Introduce our accounting and audit services to Blankville. By the end of the first year, we want to have six clients of significance and billed time of $75,000.

How can you make this happen?

Let’s suppose you’ve assigned this objective to a group of people, and they’ve worked up some plans on moving into Blankville. Here are what some of their goals might look like:

1. Since accounting and auditing services don’t work well at a remote site (except for the very largest companies), we’ll probably need a local office in Blankville. We should open this new office by July. (Always include target dates when possible.)
2. If we’re going to talk about our expertise, we need some of our professional staff there. We’ll probably want to detail two or three of our experienced people in that new office, as well as hire local support staff.
3. We may want to do some direct-mail advertising to companies in Blankville. Our message might talk about special expertise in certain areas of business. We’ll target those types of businesses in Blankville.
4. We’ll talk to the business editor of the local paper and let him or her know we’re coming to town. We might contribute a “tax tips” article or two for the exposure.
5. We’ll approach several business associations in town and offer to give a talk on some specialized topic in which we can offer some expertise.
6. We’ll ask our clients in other cities if they’d be willing to give us some referrals in Blankville.
7. We may run some modest advertising in the Blankville Bugle (a fine and respected newspaper) announcing our arrival and explaining our special expertise.
8. We’ll have an open house and invite a number of local business celebrities, political people, potential clients and media.
9. We might look to get our Blankville office involved in some high-profile charity or public service work.

You get the idea. If your objective is to build a business in Blankville, you have to put together concrete goals to make it happen. Each of these actions makes sense. You might come up with others (there’s no limit to human creativity, after all–especially in marketing). The point is that each goal should consist of concrete actions.

Each of these goals needs to have its own series of steps formalized. Who’s going to check on the advertising rates for the Blankville Bugle? And when should those ads run? Which professionals are moving to Blankville and how do they feel about it? How do we get a list of companies in Blankville? Lots of work to do.

One of the best ways to handle such details is through an activity matrix. A matrix is a grid table that lets you plot actions across time. When you’re developing a marketing plan, you’ll soon reach the point where you have to turn to your calendar and see when things should happen. A matrix provides you with a clear and very usable framework for such timeline plotting.

You can make the matrix as detailed or as big picture as you want. It should, however, include everything that’s scheduled, when it’s scheduled and who the responsible party is. Don’t forget to delegate responsibility as you go.
Whether done well or poorly, business activity always costs money. Your marketing plan needs to have a section in which you allocate budgets for each activity planned. This information shouldn’t appear on the activity matrix since there’s enough detail there already. But it should be in writing with the individual carrying overall program responsibility. People responsible for portions of the marketing activity should know exactly what funds are available to them. In fact, you would be wise to involve them in planning those budgets.

Be as objective as you can about those costs you can anticipate. For things with which you have no budget experience, add 25 percent to your best estimate. Your budget should allocate separate accounting for internal hours (staff time) and external costs (out-of-pocket expenses). Make sure to enter the budget on a Lotus or Excel spreadsheet so you can manipulate it during construction to see which variant works best.

Your budget section might look like this:

Gross sales $142,000
Budget for annual marketing efforts $7,045
Yellow Pages $2,600
Sales letter mailing to prospects $625
Clerical help on mailing list $125
Advertising in local business magazine $500
Advertising in newspaper business section $1,200
Brochure design and copywriting $380
Brochure printing $315
Registration for business exhibitions $145
Attend training session in Chicago $930
Purchase new mailing label software $225

Controls: Tracking Effectiveness
To track progress on your marketing plan throughout the year, establish a regular schedule of meetings, and spell this out in writing. How will you make adjustments to your plan midstream? How will you monitor progress in sales/costs to make changes during the year? You can’t leave yourself without this capability.

The reason you pick measurable marketing objectives is to have the ability to track your progress toward reaching them. Too many marketing efforts aren’t quantifiable, with the result that the achievements of your marketing campaigns aren’t satisfactory, or they’re just plain illusory.

All your marketing efforts will benefit from the classic feedback loop: Act, observe, adjust, act again. Scheduling quarterly meetings is best. At these meetings, responsible individuals should report on what they’ve accomplished in the last quarter, including how much of the budget has been spent. Reports should be verbal, with a printed summary for the record.

As your activities move forward over time, you’ll doubtless find the need to adjust the timing, the budget or the tasks themselves. At these points you must decide whether to intensify your efforts, add more tactical steps to pick up the pace, or scale back your objectives. Make your changes in an organized manner, adjusting all the dependent tasks so that the plan shifts as a whole. Whatever your decision, make sure to update your marketing plan document. Put in writing your understanding of why you didn’t reach your goals. Keep the original, and date and number all changes. Your plan must be dynamic, but it shouldn’t lose its sense of history. All this information will be extremely useful when you create next year’s marketing plan.

Marketing isn’t a science, but it is a skill in which you can make steady incremental improvement.

Your effectiveness section might look like this:

A) Annual gross sales from the previous year $865,000
B) Marketing expenditures planned during the current year $40,000
C) Anticipated impact of marketing expenditures on gross sales $110,000
D) Actual marketing expenses during the current year $32,500
E) Annual gross sales at the end of the current year $971,000
F) Percentage of the actual difference between this year’s sales and last year’s sales that can be fairly attributed to the marketing effort 60%

Executive Summary
Put a brief summary at the front of your marketing plan binder. On a single page, sum up (with key financial numbers) in no more than a single page the contents of your marketing plan. Use bullet points, short sentences and bold type for major points, and stay focused on the big issues. What does someone have to know about your plan to have any sense of it?

This summary gives plan readers a concise description of what your company plans to do in the coming year. It also forces you to boil your thoughts down to their rich and flavorful essence, which is always a good thing.

Here’s a sample marketing plan summary:

The year 2006 marketing plan for Sumners and Associates has four main elements:
1. We review our existing competitive marketing situation. Overall, prospects look good for our company. Boulder is growing at a steady 4.2 percent rate, with new businesses starting at roughly 750 a year. No competitive bookkeeping and accounting firm has made significant marketing efforts, although Acme Bookkeeping did run a series of advertisements in the business section of the Boulder Bugle. Our gross sales were $145,000. We’ll have to upgrade our software sometime this year, and this will cost us about $20,000, with associated hardware costs. Our supplier will let us spread these costs over three years.
2. We plan on marketing ourselves aggressively in the coming year. In addition to speaking and training engagements, we will prepare a series of three half-page ads to run on a six-time schedule in late summer and early fall in the Boulder Business Bulletin. We’ll also produce our first company brochure, which we’ll use as a handout at the training venues. Costs for production of the ads, the brochure and placement of the ads will be $8,500.
3. We foresee the following results for the coming year:
Gross sales $ 154,000
Net profit $ 12,400
4. In the long term, we’ll explore the possibilities of opening a second office in the city. Over the next two to four years, we anticipate maintaining our historical growth of 5 percent to 7 percent per year. Toward the end of that period, we’ll hire at least one other employee and consider expanding our leased space.

Your plan must address two different time frames: the short-term (one to 12 months) and the long-term (over 12 months). Most of your document should focus on the coming year, which is the most important for the majority of small and medium-size businesses. Marketing typically demands the performance of a number of short-term actions planned in unison, which together bring about change. Once you’ve outlined the major year-end goals, the analysis will largely focus on the mechanics of media, mailing and promotion. But you shouldn’t stop your serious thinking at year-end. Stretch beyond your business’s immediate needs and envision the next two or three years. What are you ultimately reaching for?

Write this down, briefly and in general terms. Questions you might answer could include: How many employees do you envision adding over the next few years? Will your need for office space stay the same? Will there be major equipment purchases? Will you be able to hire a manager? Do there exist specific training courses or certifications you’d like to put your staff through? Will your profit margin stay constant, or do you think you’ll be able to better it? Will you become active in local, regional or national trade groups? How will market demographics affect your business in the coming years? Keep track of how your larger vision changes over time as well.

Source: The Small Business Encyclopedia and Knock-Out Marketing.





How to make you known??

17 08 2007

There are many ways to define communication. The simplest definition is simply to “make known.” Another definition is “to give or interchange thoughts, feelings, information, or the like, by writing, speaking, signs, etc.” To me, communication is making connections. Take Helen Keller for instance. She wasn’t able to communicate until she learned to connect objects with words. But she didn’t stop there. Despite the fact that her physical senses may have been limited, she used her whole self to make connections with others.

Those are the connections that are the foundation for effective communication. It is part of a cycle: The more you connect with people, the stronger your communication becomes; the stronger your communication, the better you connect with people. So how do you go about strengthening those connections? By spreading value and by concentrating on what you can add to a situation, as opposed to what you can get from it. When you do this, you find that people are more receptive to you, they want to listen to you, be with you, and work with you because of the value you’re adding.

Most of the time, we think of communication as talking. I talk to you, you talk back to me—we’re communicating. But to me, there is a larger definition of communication that has to do with seeing your place in the world. To me, communication is a threefold process.

It begins with a deep and rich understanding of the environment in which we live—an open, ongoing awareness of everything around you so that you are able to take advantage of every situation in which you find yourself. Second, it is a deep and rich understanding of the people around you, your contacts and connections, so that you may bring value to them. And third, it is delivering that value.

Step 1: Understand your environment. Communication is most effective when undertaken from a strong vantage point, when you have the highest awareness of what is going on around you. As Ming-Dao Deng says in his book, 365 Tao: Daily Meditations, “…a wise person who lives high in the mountains and who is not blinded by…intellectuality, poor health or greed, will be better able to see events in the distance than one who lives in a closed room, eyes on some obscure project. A storm does not happen abruptly, it takes hours, sometimes days to develop. Travelers do not arrive suddenly. They can be seen in the distance. Knowing things in advance is possible with a high vantage point.” A practical interpretation of that passage means that it’s critical to “work from the mountaintop.”

Here’s an example of how this works. I have a product that I’m marketing. I want to connect with a particular company even though I don’t know anyone there. I start at the top, and call CEO of that company first. I explain my reason for calling, and she likes what she hears.

She says, “I want you to call my vice president of product development. I give the green light, but I want him to look into this.” I say I would, but first I ask her, “What are some of the challenges your company is going through, and what is your overall goal?” She tells me what her company is trying to accomplish, and what challenges they face.

Now that this vision is communicated to me, I can speak to the vice president of product development with a focused understanding of the company’s vision and how my product can help them reach their goals. My communication becomes much stronger when the link comes from people who have a bigger picture of what’s going on. Obviously, the CEO has the clearest view of how the company works. By starting from that position, I am working from the strongest vantage point.

Step 2: Understand the people around you. Focus on other people’s goals and challenges. You’ll be amazed at the many ways you find you can be of service to others. Simply by really listening to the other person, you are strengthening your connection and building rapport. It creates a comfort level that enables communication to be relaxed and natural. That caring and connection will always come back to you in the circle of things, without you having to ask.

Step 3: Deliver the value. Follow through on actions you said you’d take. If you promised to introduce someone to another person in your circle, do so. If you find a magazine article or book that might be of interest, recommend it (or send it directly to them). Write thank you notes. Do whatever you can to be true to your word and your purpose.

 

10 Tips Toward Better Communication

1. Throw it back. Have you ever noticed—or even participated in— verbal vomiting? It happens a lot at parties. Here’s an example: Person A sees Person B (someone she hasn’t seen in a while) and thinks, “I have to tell him what I’ve been going through, all the things that have been going on in my life.” And Person A begins to spew forth all her news. As Person A is speaking, she is leaning forward. Person B is leaning back, listening to this, all the while thinking about all the “stuff” he wants to talk about too. So the verbal vomiting continues.

We’ve all seen this happen, and most of us have participated in it at one time or another. Sometimes, however, it’s better to take yourself out of the equation. Stop talking about yourself. Make brief statements and then throw the conversation back to the other person. It’s difficult because we all like to talk about ourselves. But once in a while, it’s good to explore what other people have to say, to get beneath the surface. Then when you decide to really say something, you’ve had more time to digest what the other person has said. Based on that information, you may find mutually interesting topics of conversation, rather than the competition of verbal vomiting.

2. Parroting. Often, just giving someone your undivided attention will make him or her feel important. Concentrate on discovering what concerns them most at this moment, and then let them know you understand those concerns and that you’ll do your best to help alleviate them. You can do this by using a technique I call parroting. It’s a subtle way of getting people to expand their thoughts. For instance, in a sales situation, a conversation might go like this:

CUSTOMER: Our biggest concern right now is getting into new markets
REP: New markets?
CUSTOMER: Yes. We're going into two new areas, one where we've never  had a rep before, and one where we've had problems in the past.
REP: Problems in the past?
CUSTOMER: When we went out there last time...

 

 

 

Of course, you don’t use this technique after every sentence, but it is a signal to the other person that you’re really listening to what he or she is saying and that you’re interested to know more. The goal is to show that you’re interested in expanding on something the person is interested in or challenged by, so that you get depth and understanding of what they are dealing with. The more you know about them, the more value you can add to your relationship.

3. Expand and rephrase. Have you ever noticed that someone is speaking to you, and you can’t remember what they’ve just said? There are times when we hear no more than two words out of a sentence, or two sentences out of a story. It might be because we’re preoccupied with our own thoughts, or it might be because we don’t really understand what the other person is saying.

Keep yourself on track by rephrasing what the other person just tried to communicate to you. You might say, “Let me see if I understand what you’re saying…” Then you rephrase or paraphrase what they’ve just said. This accomplishes two things. First, it shows that you’ve been listening. Second, it guards against communication breakdown. Many sales have been lost and relationships severed because of miscommunication. You said this, she said that, and neither really understood what the other one meant. Restating the information you have just heard can be a powerful way to make sure you’re both on the same page.

4. Listen to other people’s goals and challenges. Recently, I was at business meeting trying to help two groups of people connect with each other. For some reason, they could not seem to find common ground. Finally, I asked one of the parties, “What are the three most important goals for your company right now?” He told us his three goals. The other parties questions were now totally focused on that criteria. Communication is so much stronger when you make a connection to other people’s needs and to what’s important to them. When someone sees the effort you have made to understand the criteria to elevate their success, you elevate your own at the same time.

5. Add passion to the equation. Passion and enthusiasm are contagious. You can’t communicate if no one is paying attention, and nothing grabs attention so much as someone who is truly excited about something. Let your passion come through in your voice and your gestures. Find other people who are passionate about what they do, and who communicate that passion to others. Study their methods of communication, and emulate their positive approach to life.

6. Communicate with yourself. I carry a tape recorder with me wherever I go. When I have a thought, see something interesting, or want to remind myself about a task I need to do, I record it on tape. It not only reminds me of the things I have to do, it reminds me of what I was thinking at the time. So if I think, “Call Jack to set up a lunch date. Be sure to tell him the idea about a television series for his client,” I record it, and then add more details and ideas I have. Then, when I play back the tape, I have a strong purpose and some good ideas that might have ‘escaped’ my consciousness if I didn’t record it immediately. It helps make my communication even stronger.

7. Clear your mind and be in the moment. We make mistakes when we lose concentration, when we let our minds drift away and stop paying attention. You can reflect upon the past and dream about the future when you’re out of your current situation, but while you’re in it, keep your focus sharp and to the point. This is not always easy to accomplish; we’ve got a lot on our minds. When your attention drifts, you stop listening to people, you make errors in judgment, and you lose sight of your goals. When your concentration is strong, however, you are so focused that nothing can distract you from communicating clearly and effectively.

8. Be yourself. In one of my earlier incarnations as a sales manager, I would often travel around with a rep to see how he was doing. It always amazed me when a rep with a dynamic personality and a good sense of humor would get in front of a customer—I’d wonder what happened to the person I saw just outside the door. The personality and the humor seemed to disappear because the rep thought he had to talk or behave in a particular way. The truth is, he would have been much more successful just being himself. If you’re not comfortable with who you are, other people won’t be either.

9. Make eye contact. The eyes, as you know, are the windows to the soul. There’s no better way to tell what a person is feeling than by looking into that person’s eyes. Do it when you’re listening, and when you’re speaking as well, especially when you want to make an important point. If you’re speaking to a group, pick someone in the audience and make eye contact with that one person. Then move to another person, and another so that you’re making a broad connection with everyone there.

10. Listen to others as if you had to present their ideas to a group. When Colin Powell spoke to people at the cocktail party before his speech, he had to pay attention to what they were telling him so that he could use their information at the podium. What if you had to use the information someone was presenting in a speech of your own? Are you paying attention? Do you understand what they’re saying and what they really mean? Just see how your ability to focus and listen effectively changes when you imagine yourself in this situation.

 





How to be great!

15 08 2007

What it takes to be great: Research now shows that the lack of natural talent is irrelevant to great success. The secret? Painful and demanding practice and hard work

What makes Tiger Woods great? What made Berkshire Hathaway (Charts) Chairman Warren Buffett the world’s premier investor? We think we know: Each was a natural who came into the world with a gift for doing exactly what he ended up doing. As Buffett told Fortune not long ago, he was “wired at birth to allocate capital.” It’s a one-in-a-million thing. You’ve got it – or you don’t.

Well, folks, it’s not so simple. For one thing, you do not possess a natural gift for a certain job, because targeted natural gifts don’t exist. (Sorry, Warren.) You are not a born CEO or investor or chess grandmaster. You will achieve greatness only through an enormous amount of hard work over many years. And not just any hard work, but work of a particular type that’s demanding and painful.

Buffett, for instance, is famed for his discipline and the hours he spends studying financial statements of potential investment targets. The good news is that your lack of a natural gift is irrelevant – talent has little or nothing to do with greatness. You can make yourself into any number of things, and you can even make yourself great.

Scientific experts are producing remarkably consistent findings across a wide array of fields. Understand that talent doesn’t mean intelligence, motivation or personality traits. It’s an innate ability to do some specific activity especially well. British-based researchers Michael J. Howe, Jane W. Davidson and John A. Sluboda conclude in an extensive study, “The evidence we have surveyed … does not support the [notion that] excelling is a consequence of possessing innate gifts.”

To see how the researchers could reach such a conclusion, consider the problem they were trying to solve. In virtually every field of endeavor, most people learn quickly at first, then more slowly and then stop developing completely. Yet a few do improve for years and even decades, and go on to greatness.

The irresistible question – the “fundamental challenge” for researchers in this field, says the most prominent of them, professor K. Anders Ericsson of Florida State University – is, Why? How are certain people able to go on improving? The answers begin with consistent observations about great performers in many fields.

Scientists worldwide have conducted scores of studies since the 1993 publication of a landmark paper by Ericsson and two colleagues, many focusing on sports, music and chess, in which performance is relatively easy to measure and plot over time. But plenty of additional studies have also examined other fields, including business.

No substitute for hard work

The first major conclusion is that nobody is great without work. It’s nice to believe that if you find the field where you’re naturally gifted, you’ll be great from day one, but it doesn’t happen. There’s no evidence of high-level performance without experience or practice.

Reinforcing that no-free-lunch finding is vast evidence that even the most accomplished people need around ten years of hard work before becoming world-class, a pattern so well established researchers call it the ten-year rule.

What about Bobby Fischer, who became a chess grandmaster at 16? Turns out the rule holds: He’d had nine years of intensive study. And as John Horn of the University of Southern California and Hiromi Masunaga of California State University observe, “The ten-year rule represents a very rough estimate, and most researchers regard it as a minimum, not an average.” In many fields (music, literature) elite performers need 20 or 30 years’ experience before hitting their zenith.

So greatness isn’t handed to anyone; it requires a lot of hard work. Yet that isn’t enough, since many people work hard for decades without approaching greatness or even getting significantly better. What’s missing?

Practice makes perfect

The best people in any field are those who devote the most hours to what the researchers call “deliberate practice.” It’s activity that’s explicitly intended to improve performance, that reaches for objectives just beyond one’s level of competence, provides feedback on results and involves high levels of repetition.

For example: Simply hitting a bucket of balls is not deliberate practice, which is why most golfers don’t get better. Hitting an eight-iron 300 times with a goal of leaving the ball within 20 feet of the pin 80 percent of the time, continually observing results and making appropriate adjustments, and doing that for hours every day – that’s deliberate practice.

Consistency is crucial. As Ericsson notes, “Elite performers in many diverse domains have been found to practice, on the average, roughly the same amount every day, including weekends.”

Evidence crosses a remarkable range of fields. In a study of 20-year-old violinists by Ericsson and colleagues, the best group (judged by conservatory teachers) averaged 10,000 hours of deliberate practice over their lives; the next-best averaged 7,500 hours; and the next, 5,000. It’s the same story in surgery, insurance sales, and virtually every sport. More deliberate practice equals better performance. Tons of it equals great performance.

The skeptics

Not all researchers are totally onboard with the myth-of-talent hypothesis, though their objections go to its edges rather than its center. For one thing, there are the intangibles. Two athletes might work equally hard, but what explains the ability of New England Patriots quarterback Tom Brady to perform at a higher level in the last two minutes of a game?

Researchers also note, for example, child prodigies who could speak, read or play music at an unusually early age. But on investigation those cases generally include highly involved parents. And many prodigies do not go on to greatness in their early field, while great performers include many who showed no special early aptitude.

Certainly some important traits are partly inherited, such as physical size and particular measures of intelligence, but those influence what a person doesn’t do more than what he does; a five-footer will never be an NFL lineman, and a seven-footer will never be an Olympic gymnast. Even those restrictions are less severe than you’d expect: Ericsson notes, “Some international chess masters have IQs in the 90s.” The more research that’s done, the more solid the deliberate-practice model becomes.

Real-world examples

All this scholarly research is simply evidence for what great performers have been showing us for years. To take a handful of examples: Winston Churchill, one of the 20th century’s greatest orators, practiced his speeches compulsively. Vladimir Horowitz supposedly said, “If I don’t practice for a day, I know it. If I don’t practice for two days, my wife knows it. If I don’t practice for three days, the world knows it.” He was certainly a demon practicer, but the same quote has been attributed to world-class musicians like Ignace Paderewski and Luciano Pavarotti.

Many great athletes are legendary for the brutal discipline of their practice routines. In basketball, Michael Jordan practiced intensely beyond the already punishing team practices. (Had Jordan possessed some mammoth natural gift specifically for basketball, it seems unlikely he’d have been cut from his high school team.)

In football, all-time-great receiver Jerry Rice – passed up by 15 teams because they considered him too slow – practiced so hard that other players would get sick trying to keep up.

Tiger Woods is a textbook example of what the research shows. Because his father introduced him to golf at an extremely early age – 18 months – and encouraged him to practice intensively, Woods had racked up at least 15 years of practice by the time he became the youngest-ever winner of the U.S. Amateur Championship, at age 18. Also in line with the findings, he has never stopped trying to improve, devoting many hours a day to conditioning and practice, even remaking his swing twice because that’s what it took to get even better.

The business side

The evidence, scientific as well as anecdotal, seems overwhelmingly in favor of deliberate practice as the source of great performance. Just one problem: How do you practice business? Many elements of business, in fact, are directly practicable. Presenting, negotiating, delivering evaluations, deciphering financial statements – you can practice them all.

Still, they aren’t the essence of great managerial performance. That requires making judgments and decisions with imperfect information in an uncertain environment, interacting with people, seeking information – can you practice those things too? You can, though not in the way you would practice a Chopin etude.

Instead, it’s all about how you do what you’re already doing – you create the practice in your work, which requires a few critical changes. The first is going at any task with a new goal: Instead of merely trying to get it done, you aim to get better at it.

Report writing involves finding information, analyzing it and presenting it – each an improvable skill. Chairing a board meeting requires understanding the company’s strategy in the deepest way, forming a coherent view of coming market changes and setting a tone for the discussion. Anything that anyone does at work, from the most basic task to the most exalted, is an improvable skill.

Adopting a new mindset

Armed with that mindset, people go at a job in a new way. Research shows they process information more deeply and retain it longer. They want more information on what they’re doing and seek other perspectives. They adopt a longer-term point of view. In the activity itself, the mindset persists. You aren’t just doing the job, you’re explicitly trying to get better at it in the larger sense.

Again, research shows that this difference in mental approach is vital. For example, when amateur singers take a singing lesson, they experience it as fun, a release of tension. But for professional singers, it’s the opposite: They increase their concentration and focus on improving their performance during the lesson. Same activity, different mindset.

Feedback is crucial, and getting it should be no problem in business. Yet most people don’t seek it; they just wait for it, half hoping it won’t come. Without it, as Goldman Sachs leadership-development chief Steve Kerr says, “it’s as if you’re bowling through a curtain that comes down to knee level. If you don’t know how successful you are, two things happen: One, you don’t get any better, and two, you stop caring.” In some companies, like General Electric, frequent feedback is part of the culture. If you aren’t lucky enough to get that, seek it out.

Be the ball

Through the whole process, one of your goals is to build what the researchers call “mental models of your business” – pictures of how the elements fit together and influence one another. The more you work on it, the larger your mental models will become and the better your performance will grow.

Andy Grove could keep a model of a whole world-changing technology industry in his head and adapt Intel (Charts) as needed. Bill Gates, Microsoft’s (Charts) founder, had the same knack: He could see at the dawn of the PC that his goal of a computer on every desk was realistic and would create an unimaginably large market. John D. Rockefeller, too, saw ahead when the world-changing new industry was oil. Napoleon was perhaps the greatest ever. He could not only hold all the elements of a vast battle in his mind but, more important, could also respond quickly when they shifted in unexpected ways.

That’s a lot to focus on for the benefits of deliberate practice – and worthless without one more requirement: Do it regularly, not sporadically.

Why?

For most people, work is hard enough without pushing even harder. Those extra steps are so difficult and painful they almost never get done. That’s the way it must be. If great performance were easy, it wouldn’t be rare. Which leads to possibly the deepest question about greatness. While experts understand an enormous amount about the behavior that produces great performance, they understand very little about where that behavior comes from.

The authors of one study conclude, “We still do not know which factors encourage individuals to engage in deliberate practice.” Or as University of Michigan business school professor Noel Tichy puts it after 30 years of working with managers, “Some people are much more motivated than others, and that’s the existential question I cannot answer – why.”

The critical reality is that we are not hostage to some naturally granted level of talent. We can make ourselves what we will. Strangely, that idea is not popular. People hate abandoning the notion that they would coast to fame and riches if they found their talent. But that view is tragically constraining, because when they hit life’s inevitable bumps in the road, they conclude that they just aren’t gifted and give up.

Maybe we can’t expect most people to achieve greatness. It’s just too demanding. But the striking, liberating news is that greatness isn’t reserved for a preordained few. It is available to you and to everyone.

Source: http://money.cnn.com/magazines/fortune/fortune_archive/2006/10/30/8391794/index.htm?postversion=2006101915





What is/are the secret(s) of success in life? (cont.)

15 08 2007

How hard that is to change our goal in life?

First, we human naturally resist changes. We are built to stay with habits, routines, schedules. We do want to change. Say, every day you wake up at 6am. It is not easy for you to change your routine to wake up at 5am instead. We only change when we have to. Most of us do not like changes. It is must more comfortable to stay exactly where we are; we know very well our current situation. It is very uncomfortable (and sometimes scary) to walk into a new road and face the unknown, the uncertain future.

That is why every time we talk about moving the country forward, we always have to talk about tu duy problem (thinking problem). People are used to think one way, they don’t want to change their thinking to a new way. (There is a psychology term to describe this change-resistant tendency in human behavior. But I forgot what that is).

Second, once we have invested so much effort in a goal, we don’t want to “take a loss” to abandon that goal. “I have spent three years in medical school. Now I just throw all that away and try to be a marketer?”

These two things make changing goal very difficult. That is why many people go through life afraid of making changes, afraid of goal changing. They basically stay at one place and feel miserable about their life.

However, my experience is that the above two (scary) factors have been misunderstood and exaggerated greatly.

First, the future, although unknown, is not more unknown and more risky than the present situation. We assume that we know today. Well, are you sure that you may not get into a car accident later today? Or something won’t happen today that may affect you greatly?

Moreover, when we think bout the future, why do we have to think about bad stuff only? Why should the future be any scarier than the present? The future may as well bring us as much happiness as, if not more happiness than, the present. Think positive! Think positive! Think positive!

In addition, if we are so unhappy with the present, i.e., we feel we are at the bottom, chances there is only one way for us to go: UP. (You can’t go down if you are already at the bottom).

Second, wasted investment. We feel that when we abandon an old goal, we waste all the money, effort and energy spent for that investment.

This is wrong. We never waste any experience in life. Say, you study three years in medical school, then you switch gear and study law. Do you waste three years in medicine? No, not really. Your medical knowledge may help you in trying court cases involving medicine and doctors later. Or you have been doing marketing for several years, now you quit and go to medical school. Your marketing knowledge may be helpful when you open your medical office or hospital later.

No experience is wasted in life. We build our experience one on top of another like bricks in a wall. So the thinking that when we change goal we waste the “investment” we have spent in the old goal is just wrong thinking. No experience is wasted in life.

So, we can see that the “difficulty” in goal changing is not real. It is in our mind. It is just a wrong way of thinking. It makes us negative, scared, and unmotivated. It is just in our head.

We just have to learn to think positively about changes. We have to love changes. Look at changes as new opportunities to open new roads into the future, which may lead to many interesting things.

The point is, we nay know what we have now. But we will never know what we may have in the future if we don’t try to open new roads.

At this point I need to bring in a balancing note, to make sure no one will read my message in the extreme. I am talking about changes and changing life goals and I am encouraging everyone to change life goals, BUT only when we feel the need to change. Meaning, ONLY when we find that our current goal is not good for us, doesn’t fit us,
doesn’t make us happy, meaning, only when we really feel in our heart that we should change goal.

Other than that, try to stay with the current goal and work at it and make it a success. If we change goal every three weeks, they are not goals. They are just scattered brain.


by Tran Dinh Hoanh, LLB, JD
Attorney of Law
Washington DC





What is/are the secret(s) of success in life?

15 08 2007

The idea of “success” ultimately has to be a personal idea. Success means achieving what we aim to get. And “aim” or “goal” is a very personal thing; ultimately it is always our own aim, our own goal. If your dad wants you to be a doctor (although you don’t really want it) and you want to please your dad, so you go to medical school and become a doctor. Then you have succeeded in fulfilling your dad wish and making him happy; that was your goal (of making your dad happy). Whether you would be successful as a doctor is another question. This example shows that ultimately our goal in life is still our own personal goal, even though sometimes it may appear that we simply fulfill someone else’s goal and wishes.

Personal ownership of our goal and personal responsibility for our goal is the foundation of our life. So, we need to take charge of your life and can’t blame someone else for our life problems.

Let’s define that “success” means “achieving our own goal.” This ultimately translates to personal happiness (when you achieve our goal we will be happy, at least for the moment).

But the million-dollar-question question is: How do I know what goal or goals I should have for my life?

As we all experience, most of the time we don’t know what our goal is or should be. Most of us kinda float through life with strange and unexpected events jumping at us from all directions and leading us into new and unknown roads often enough. What goals?!!

At this juncture, we need to take a break and talk about the nature of life: “Life is a river.” (This is no novel idea. The Greek philosopher Heraclitus has said “You can never step into the same river twice” to describe the changing nature of life)

Now let me add to this ancient idea my own idea: “Life is a river and each one of us is a fish in the river.”

Life is a river because it is ever-flowing and ever-changing.

We live in life (or through life), therefore we are in the (life) river.

The above two sentences very much define the nature of our life. Since we are just a fish in the river, our life, our fate and our destiny depends largely on the river itself. A fish will be where the river leads it. The fish cannot change the river. The fish is pulled along by the river. The river largely determines the fate of the fish.

This is the “uncontrollable” element of our life, since we cannot do much to alter the course of the river. We cannot do much to avoid a war or a tsunami or an earthquake. These things, when they happen, they affect our life greatly. We as individuals can’t avoid them. This uncontrollable element generates the “uncertainty” of life, the “unknown of our future,” the “chances” that something unexpected will happen to us tomorrow. This uncontrollable element is so large in our life that we call it “God’s will” or “the fruit of previous lives” or vo^ thu+o+`ng (non-permanence) or simple “crazy coincidences” (for the folks who do not believe in anything supernatural). Whatever we call it, we have to realize that life is full of uncertainty, full of unexpected events, full of changes, full of chances (as Forrest Gump said, “Life is a box of chocolate. You never know what you will get next.”).

Understanding the nature of uncertainty about life ( vo thuong) is very important in going through life. Like riding a motorcycle, nothing is certain on the road. People and traffic keep coming at you, and you keep moving left, moving right, slowing down, speeding up, to avoid hitting people and to move ahead. Sometimes you even have to abandon a street and turn into another street to avoid a traffic jam. Riding a motorcycle means dealing with uncertainty and constantly adjusting your movements to that ever-changing uncertainty.

Living is similar. You may have a goal or a plan, but things change (like war, a death in the family, an accident, or simply your change of heart) and these may make your goal and your plan no-longer important, or no-longer interesting, or no-longer meaningful, or no-long attainable. In other words, the river has carried you, the fish, into new bend, a new lake. Then you have to be quick to change along, just like a good driver maneuvers his motorcycle quickly on the road. You may need to drop your old goal and create a new goal for the new circumstances.

In other words, because life is non-permanent (vo thuong), you need to be non-attaching ( vo chap). Don’t attach yourself to the old, obsolete goals. Move to a new goal whenever new circumstances require. You have planned to be a doctor, now the new circumstances are that it may make more sense for you to drop that goal and be a marketing agent to make money to feed your brothers/sisters at home. Did you fail in your goal to be a doctor? No. You have just changed that goal into a new goal of making good money to feed your family and you are successful at that new goal.

This concept about life changes and corresponding changes in our goals is important, because many people will think that when they fix a goal they have to stick (attach) to it at any price and if they don’t, they have failed in their goal.

Understanding life uncertainty also gives us the artful ability to be flexible and to change quickly through life, like a fish adapts itself quickly to a new part of the river, a new lake, a new fall, a new muddy rapid, a new stormy part. The better we adapt ourselves to new circumstances in life, the more successful we will be.

So we have moved from the concept of life changes to the recommendation that we are quick to adapt to those changes. And that leads to the answer to the question “What goal or goals I should set for myself?” The answer is: (1) Ask your heart. Goal is a personal matter. Only your heart knows your goal. Ask your heart for a goal. What goal you like the most, feel attracted to the most, feel comfortable about the most, feel happy with the most? That is your goal. And (2) be ready to drop that goal and create a new goal when your thinking or circumstances changes, so that you will have a new goal that you heart will be happy under the new circumstances.

Most people are unhappy going through like because they do not understand the changing nature of life and are so rigid in their goal. At the age of 10, he sets his mind to be a doctor, and circumstances 30 years later make him unable to become a doctor, therefore he feels miserable all his life for “being a failure.” Come on! He has failed to understand life’s changing nature, has failed to change his goal along, and has failed to set up a more meaningful goal for himself. That is where his failure is.

We have just moved from life’s changing nature (which we cannot control) to our own ability to change along (which we can control). That is where our “controllable element” comes into play. We cannot control life events, but we can control our ability to deal with those events. The fish cannot change the course of the river, but it has the ability learn different ways of swimming, to deal with different kinds of water flows, to survive the river in the storm, to adapt to new lakes and new ponds when the river carries it there.

This controllable element is where our human capacity comes into play. We cannot change the course of life events, but we may learn how to react to it proactively, positively and successfully. We may not be able to stop a storm, but we may learn to protect our house in a storm, or to evacuate to a better ground, or even to do good business relying in stormy weather. Our ability to change life events is almost zero, but our ability to react to these events positively and productively is huge. We may not be able determine where the river of life may carry us to, but we may very well be able to determine our personal success wherever the river may place us. The problem is not whether the river will go through torrents and falls (It will for sure!); the problem is whether the fish is smart and strong enough to survive and even to enjoy the falls and the torrents.

And this human ability comes mostly from an open mind and a positive attitude. The open mind gives us the ability to try and know many things, many cultures, many people, many friends, and therefore many experiences. The open mind has no prejudice, has no attachment to “this thing is bad, this guys is bad, I don’t want anything to do with it, anything to with him.” People with open mind are always humble, always soft and always… open.

The positive attitude gives us the mental vigor to move over obstacles, the happiness to be strong every day, and the attraction to attract many friends as our allies. People with these things are usually successful.

In short, I think the secret to success in life is in a couple of points:

1. Understand that our life is our own life and our goal is our own goal.
2. Life is ever-changing. We need to be able to change along, including changing our goals.
3. Life changes are mostly out of our control.
4. We cannot control life but we can control our reaction to life changes.
5. If we train ourselves to be non-attachment, so that we can change along with life. If we have an open mind and a positive attitude (about our self, about life, about others around us) to deal with life changes and with the world and people around us positively, we will be successful in our goals.

(Note: When we are open-minded and are positive about life, we will be humble and gentle with everyone, including people who may hurt us. This is the test for you to know if you are truly open-minded and positive).

As they say, we never stop learning in life. So this will not be my last words on the subject, because just like you, I am learning. Just like you, I am groping along, one step at a time. This is just to share with you, especially the younger brothers/sisters, from the heart of a brother who is very passionate about you.


By Tran Dinh Hoanh, LLB, JD
Attorney of Law
Washington DC





Pay-Per-Click Tips for Attracting Traffic

15 08 2007

By Cory Rudl – Entrepreneur.com

Pay-per-click (PPC) search engines can be a powerful, instant source of qualified traffic for your website?provided you do your homework and invest a bit of time in managing your campaign. In fact, many website owners who’ve mastered keyword targeting and know the “insider” bidding strategies tell me that more than 90 percent of their traffic comes straight from the PPC search engines!

So I’m going to show you the strategies and tools these folks are using?so you can duplicate their success. I’m going to explain hot new targeting options and bid-management tools being offered by the PPC search engines that you can use to increase your traffic while keeping bidding costs low.

A lot of people think the only way to develop a successful pay-per-click campaign is to get the highest ranking with a popular keyword in the top two PPC search engines, Overture and Google AdWords.

Now it’s true that a top-ranked ad with either of these two industry giants will guarantee your site a lot of exposure?as long as you’re bidding on keywords that a substantial number of people are searching for. The problem is, you often have to pay more for these No. 1 spots. And in the case of the more competitive keywords, this can means bids of $1.50 to $5.00 (or more!) per click.

If you want to be successful with the PPC search engines, you need to bid on keywords that attract clicks from “qualified” buyers (as opposed to “tire kickers” who’ll drive your costs up) while keeping your bids as low as possible.

Here are seven tips that will help you accomplish that:

1. Figure out what you can afford to bid. This might sound obvious, but it needs to be said: Don’t bid more than you can afford! A lot of businesses make this mistake.

Before you pay for advertising of any sort, calculate the value of a single visitor to your site. Once you know what one visitor is worth, you’ll know the maximum amount you can afford to pay per click.

2. Being “No. 1″ isn’t always best. You don’t always need to be ranked No. 1 for certain keywords to attract visitors. Sure, it helps if your ad appears in the top 10 results. But people click on listings featured on the second and even third page of results for competitive keywords.

So run some tests. Vary your bids so that your listing appears higher and lower on the page and see what effect the ranking has on your profits. You may actually find that for more costly keywords, a slightly lower ranking is more profitable.

3. Bid on low-cost variations and common misspellings of particular keywords. Frequently, you’ll see businesses bidding as much as $5.00 per click for popular keywords?while nobody is bidding on common misspellings and similar keywords that cost just pennies per click. Use Wordtracker to locate keywords that relate to your business and are frequently searched by your market, but that none of your competitors are bidding on.

4. Bid on highly targeted phrases with less traffic. Rather than bid on a handful of “general” keywords, which tend to be more expensive because they get the highest number of searches, bid on dozens?or even hundreds?of highly “targeted” keywords, which tend to be cheap. For example, instead of bidding on “pet supplies,” you might bid on “red dog leash,” “oversize dog kennel,” and “cat toys with bells.” You’re sure to see better sales conversions on the more targeted keywords because they attract more qualified buyers. And since no one is bidding on these keywords, your advertising costs associated with this traffic are extremely low.

Another benefit of this strategy is that you can direct these qualified visitors to a page that gives them exactly what they’re looking for. In the above example, your listing for the keyword, “oversize dog kennel” could link directly to your dog kennel catalog page, rather than to just the home page of your pet supply store.

5. Bid on keywords in the lesser-known PPC search engines. Overture and Google are the PPC industry leaders, but some of the smaller PPC search engines are worth checking out as well. The most popular ones are:

# Findwhat
# Kanoodle
# Enhance Interactive
# LookSmart
# Espotting (for the UK & Europe)

These engines won’t get you the same exposure you might get with Overture and Google AdWords, but you can still generate a respectable amount of traffic with them. And best of all, they’re much cheaper.

6. Create separate ads for each product or service you sell. This is an extremely effective strategy, but very few businesses are using it: Write ads specific to each keyword and phrase you bid on. For example, instead of writing an ad for “sporting goods,” write one for “quality leather soccer balls,” another for “discount ladies’ tennis shoes,” and so on.

These customized ads will attract more attention (and clicks!) from qualified buyers. And of course, you’ll be able to convert more of these visitors to buyers if you direct them to a page on your site with the exact product or service they’re searching for.

7. Get listed in relevant specialty PPC search engines. Did you know that there are specialty PPC search engines that target different markets such as brides, pet owners, antique collectors, car owners and so on?

Check out PayPerClickSearchEngines.com to see if there are any relevant to your business that might be worth getting listed in.

Targeting Your Campaigns
PPC search engines are constantly looking for new ways to improve their services?and your results. After all, they want you to keep purchasing advertising from them and not their competitors.

Here’s an overview of some great tools they’re offering to help you better target your ads and keep your campaign costs down:

1. Keyword Matching Options (offered by Overture and Google AdWords). Both of these search engines offer options that allow you to fine-tune the way your keyword is matched to the phrases people type into their engines. Their options differ slightly, but here’s a rough breakdown:

# Exact match. A listing is triggered by the exact keyword phrase and nothing else. Example: “fishing rods” will match “fishing rods” but not “fancy fishing rods.”
# Phrase match. A listing is triggered by the keyword phrase as it’s written, though it might be included with other terms as well. Example: “fishing rods” will match “antique fishing rods and reels” but not “rods fishing.”
# Broad match. A listing is triggered by the keyword phrase or slight variations of it, even if the words are out of order or separated by other words. Example: “fishing rods” will match “Rod’s Alaskan Fishing Adventure” and possibly even “Rod’s Fish & Chips.” Warning: The broad match option can work well for highly specific queries, such as brand names or serial numbers, but can result in a lot of poorly targeted click-throughs for general terms, especially terms that have more than one meaning, such as “dolly,” “tackle” or “nails.”
# Negative match. When words identified as “negatives” are typed into the search engine along with the keyword phrase, the listing will not appear. Example: “fishing rods – cheap” will match “fishing rods and tackle” but not “cheap fishing rods.”

2. Contextual Targeting (offered by Overture, Google AdWords, Kanoodle and Enhance Interactive). Contextual targeting places your PPC listing on websites where the content somehow relates to your ad. Obviously, this can be a great way to increase the exposure of your ad.

If you decide to try contextual targeting, however, be sure to monitor where your ads are being placed because the effectiveness of contextual targeting can vary widely. Your ads may end up featured on websites that have little to do with your advertisement?and therefore attract unqualified click-throughs.

For example, a recent USnews.com article about starting a business had a series of “Hermosa Beach Vacation” Google Ads listed beside it?because the first person interviewed in the story happened to live in Hermosa Beach! These wasted clicks can quickly drain your bank account if you aren’t careful.

3. Geotargeting (offered by Overture and Google AdWords). Geotargeting allows you to choose which countries or geographic regions your ads appear in. This feature is best suited for businesses that offer local services or products that are useful only in specific regions.

For example, if you’re a landscaper who lives in Washington state, you probably don’t want to pay for click-throughs from out-of-area visitors. After all, Texas-area residents aren’t likely to request your services.

4. Day Parting (offered by Kanoodle). Right now, Kanoodle is the only search engine we know that offers this option. “Day parting” allows you to choose the time of day your ads will appear in different regions, so they’re only available during “prime viewing times.”

For example, if your market testing shows that most people click on your ads to make a purchase in the early evening, you can make sure your ads appear only at that time in the different regions where your potential customers live.

5. Keyword Research Tools (offered by Overture, Google AdWords, FindWhat, Kanoodle, LookSmart and Enhance Interactive). The most popular keyword phrases are always the most expensive. Keyword research tools help you find common variations and misspellings of the more popular keywords so you can keep costs down while still generating traffic.

More sophisticated keyword research tools let you see how much you need to bid to achieve a particular ranking (for example, the No. 1 spot, the No. 7 spot and so on) prior to finalizing your bid. They may also provide you with traffic estimates for the different keywords and phrases you bid on.

6. Multiple Ads for the Same Keyword (offered by Google AdWords). Google AdWords allows you to “split test” different ads for the same keyword so you can see which ad attracts the most paying customers. This can save you a lot of time, and enables you to make sure your ads will yield the highest possible return on your investment.

7. “Autobid” Software (offered by Overture, Google AdWords, FindWhat, Kanoodle, LookSmart and Enhance Interactive). Autobid software is a bid management program that tracks the bidding activity on your different keywords and automatically adjusts your bidding amount so you can maintain your ranking. The more sophisticated bid management programs allow you to “cap” your bids so you never spend more than you want.

They also eliminate “bid gaps” that occur when the bidder below your listing drops their bid?your bid is automatically reduced so you maintain your position without spending more per click than necessary.

Final Thoughts
If you haven’t tried a PPC search engine campaign yet, I’d recommend doing it soon. There are still tons of cheap, targeted keywords waiting for your bids?but they may not be around much longer. More and more online businesses are realizing that?done right?a PPC campaign can be a fabulous source of cheap, instant, highly qualified traffic.

The best advice I can give you is this:

# Bid on lots of cheap, targeted keywords and phrases, including misspellings, and avoid the expensive general words that everyone is bidding on.
# Never bid more per click than what a single visitor is worth to your site?it’s the best way to make sure your ads remain profitable.
# Get listed in the “other” PPC search engines. You may be able to bid on popular terms you can’t afford in Overture and Google AdWords.
# Whenever possible, get ranked in the top 3 listings in Overture and Google AdWords. These ads appear on an extensive network of sites (including Yahoo!, MSN, AltaVista, Excite and more) and can reach up to 80 percent of all active internet users, so you get more bang for your buck.
# Target your ads as much as possible. Write “custom” ads for each keyword and use the various bid management and targeting tools offered by the different PPC search engines to reduce your costs and increase your clicks.
# Design your landing pages so they convert qualified visitors to buyers. If your ads promise “cat toys with bells,” make sure they actually direct visitors to a page where it’s easy for them to buy these items.

Corey Rudl, author of Insider Secrets to Marketing Your Business on the Internet and founder of www.marketingtips.com, is widely recognized as an Internet marketing expert because what he teaches are not theoretical approaches to online marketing but real examples of what works.

Source: http://smallbusiness.yahoo.com/r-article-a-2437-m-6-sc-35-payperclick_tips_for_attracting_traffic-i





Google AdWords Optimization Tips

15 08 2007

Google controls more of the search market than all of its competitors combined. With that being said, Google has a ton of advertising space to sell. If you know how to optimize AdWords better than your competitors you stand to achieve great profit.

Google vs Overture: Overture is the main competitor to Google AdWords. Overture is strictly price driven, which requires a ton of editors to perform countless hours of maintenance. Google is a highly mathematical company, and protect the quality of their listings in two ways: they have editors, and more importantly they monitor click through rate. Why does Google AdWords monitor click through rate?

Google Adwords Tips: Click Through Rate

Click through rate is a rough approximation of relevancy, in many ways this parallels the idea of grading the web on links. A relevant ad will have higher click through rates than a non relevant listing.

Google ads are not strictly price driven. Some think the added relevancy factor relates to the words in the add, while this is somewhat true, the true multiple is click through rate. If a web site has 3* the click through rate, that means Google can sell 3* as much advertising. To reward careful and considerate ads Google chops this price to 1/3 of what it would be with a site that had a third of the click through rate.

Google Adwords Tips: Keyword Selection

Successful ad buyers learn how to lower their prices by tweaking them in to match what the end user is looking for. Bidding wars should be avoided as they are a technique that indicate a lack of creativity. There are multiple ways to say the same thing, and few people are creative enough to think what is “searched for.” Yes you can exactly describe your product, but you need the people who have a problem to find your solution weather or not it exists. You may even want some of your keyword phrases to be in question format.

If you take the time to be the only one listed for a creative relevant term you may seem like the only answer to a problem, or at least the only one who cared. If you have the keywords you want to list well in within your text it they will be bold when people search for them. This will also add to your click through rate.

Qualify your traffic. One word search terms frequently draw competitors and junk traffic to a level that usually exceeds any intrinsic value the listing may have. Not every ad makes money.

Google Adwords Tips: Basic Google AdWords Listing Functions

Google has three separate ways you can list AdWords.

* AdWords A Adwords B, will pick up any search string with AdWords A Adwords B in it, even if they are in any order. In addition broad matching (which is on by default) also shows your ads for synonyms.
* “AdWords A Adwords B” will pick up any search with that exact phrase “AdWords A Adwords B” included in the search string.
* [AdWords A Adwords B] will only pick up on searches for AdWords A Adwords B

In addition to the above techniques of qualification, you can also list which words you do not want in the query. if you did not want the word “free” in the search you would put -free at the end of your keywords list, or set your negative keywords at the campaign level.

Typical bad words are: free, cheap, download, crack, pic, pics, gallery…

Google Adwords Tips: Google AdWords Syndication

Google AdWords are syndicated, which means you can choose to list only in Google; in Google & other search sites; or in Google, other search sites, and in contextual ads. Think of the various user bases and decide which may be better for you. You also can decide which countries and languages you want to list in for further targeting.

Some people have been complaining that content syndication is lowering their ROI. I offer my solution here.

Google AdWords Tips: AdWords Groupings

You can place expensive words in there own ad group. You may want to use some ad groups for generic terms and others for specific terms.

As long as they are relevant and specific you are not likely to use too many keyword phrases, just remember to place them in various groups and track them.

The proper technique to gather accurate market information is to overspend off the start and see what happens in the long run. If you overspend you collect faster feedback. You learn from your account.

Google Adwords Tips: Bidding

The important tip as far as bids go is to bid enough to get first screen exposure, and do not keep throwing more money at a problem to do this. If the click through rate is garbage, fix the keywords and content of the ads.

If you start out way too low you will always be fighting an uphill battle. Remember that you are bidding against the best ads that have been developed over time so you are likely going to get your tail kicked for a while.

Google Adwords Tips: Tracking

Google allows the ads to be grouped and has began offering a free conversion calculator. Through properly grouping and monitoring the results of your Adwords campaign it is easy to see which ads are profitable and create similar ones.

Google AdWords Tips: Targeting

Google AdWords now allows you to target your ads based on the country, state, or city level, as well as have your ads appear within a specified radius of a location.

Geotargeting will help increase your clickthrough rate and give you traffic which is more pre qualified for a purchase if you are a local business.

Google AdWords Tips: Affiliates

Only one affiliate or merchant ad can appear per landing page per keyword. Whatever ad between all the affiliate ads and the merchants own ad has the highest effective click price (max CPC bid * clickthrough rate) will display.

If affiliates make their own white label review site with substantially unique content then many of those ads can display along with the merchant ad.

Google AdWords Tips: Tips for a Successful Campaign

If you intend to launch a large AdWords campaign, these Google AdWords tips on this page are not enough to guarantee your success. You need creativity, hard work, and if you are really serious about AdWords the $69 you will spend on Andrew Goodman’s report might be the best $69 of your life. In his 150 page eBook he covers in depth details to help guarantee your success.

Many other tips are covered in his report and what you have read thus far is only the tip of the ice burg.

Source: http://www.search-marketing.info/search-engines/major-search-engines/google-adwords.htm





stages to achieving great organic listings

15 08 2007

There are many stages to achieving great organic listings.

1. Your site should be about something you are an expert on.
2. A good site plan should be thought out before you begin marketing.
3. Scope out the competition to see how competitive your keyword landscape is.
4. Decide what keywords you want to use prior to making your site (and before each page), and include them in your meta tags , page copy, page title, and file names when possible.
5. Your site should be easy to navigate and search engine friendly.
6. Each page should have a specific focus which is strongly and thoroughly maintained throughout.
7. Submit your site to the directories.
8. (not required) Search for spam in your keywords and report spam results. Some search engines (such as Yahoo!) actively edit their search results and you may be able to get spammy competitors removed.
9. Build a linking campaign. (Link building is the single most important step to EFFECTIVE SEO.)
10. Repeat what steps you feel necessary until you achieve top rankings. This is an ongoing process for most sites (especially in competitive fields).

Sources:





Don’t Get Buried in Customer Data—Use It

9 08 2007

With the advent of customer relationship management (CRM) in the late 1990s, companies came to believe that by using technology to tailor their offerings to individual consumers’ needs, customer loyalty—and company profits—would skyrocket.

But in today’s crowded marketplace, customer loyalty is more elusive than ever. A recent McKinsey study reveals that the annual churn in the wireless industry increased from 17 percent in 1995 to 32 percent in 2000. This trend holds true even in industries less susceptible to turnover. In core retail categories such as department stores, for instance, the top players’ market share declined more than 10 percent.

Not surprisingly, many executives’ faith in CRM has waned. In a 2001 Bain & Co. survey of the 25 most popular management tools, CRM was ranked near the bottom. In a follow-up study, 20 percent of the 451 senior executives polled said that their companies’ CRM initiatives had failed to deliver profitable growth and had damaged long-term customer relationships.

Tempting as it may be to point the finger at your CRM technology, that won’t help you reverse these worrisome trends. It’s quite possible that the problem isn’t with your CRM technology at all but with the way you are collecting and using your data, experts say. Although getting your CRM program in order is an essential component of achieving customer loyalty, there’s much more that you need to do.

“Marketers need a good, thoughtful architecture to base their decisions on,” says Harvard Business School marketing professor Gerald Zaltman. A more strategic approach to data mining can provide the foundation for that decision-making architecture. Below, advice on how to use information about the individual customer and the average customer in concert, and how to probe beneath customer preferences and behaviors to uncover the attitudes that provide a more solid understanding of customer loyalty.

Why you need both individual and aggregated data

One-to-one marketing, a term coined by Don Peppers and Martha Rogers in their influential 1993 book, The One to One Future (Currency/Doubleday), focuses on share of customer: Using the insights about what makes your most loyal customers different to maximize the value of those relationships. By the end of the decade, many marketers had come to believe that the combination of mass customization techniques, sophisticated database software, and the Internet would enable them to actually deliver on the promise of customized offerings to each individual customer.

But that hasn’t happened to the extent it should have, says Cleveland-based consultant James H. Gilmore, coauthor with B. Joseph Pine II of The Experience Economy (Harvard Business School Press, 1999), because “most practitioners have taken the concept of one-to-one marketing and bastardized it into CRM. They’re using CRM tools to design better processes for a nonexistent ‘average’ customer, instead of customizing for individual customers.”

He cites the example of a major hotel chain that asks guests to complete a multiple-question satisfaction survey via their room’s TV set during their stay. When one guest answered “extremely dissatisfied” to all the questions, he was not treated any differently when he checked out. Why? Because his answers went straight to a central repository where they were aggregated with other customers’ responses and used to measure overall market—not customer—satisfaction. A more effective approach would be to feed his answers directly to someone at the front desk who could respond immediately to his needs and create a better experience for him.

“A company’s goal should be to learn more about what each customer needs so that it can close the customer sacrifice gap, which is the difference between what individual customers settle for and what each wants exactly,” says Gilmore. Steve Cunningham, director of customer listening at Cisco, agrees that it’s vital to listen and respond to individual customer needs and preferences. But he believes you must also pay attention to the aggregate data—customer averages based on individual surveys.

“Let’s say that based on the customer survey averages, you realize that your hotel is taking too long to check guests out,” he says. “So you launch initiatives designed to reduce checkout time and prime your personnel to be sensitive to that issue. Despite these efforts, something goes wrong, and one morning the front desk manager sees a long line of guests queued up to check out. Because the survey averages have helped sensitize him to the importance of this issue, he knows he has to do something—for example, pull staff members off other jobs so they can help check people out, or offer free coffee to everyone who’s standing in line.”

Familiarity with the aggregated survey data, in other words, helps the manager tailor his response to individual customers.

Cisco relies on three layers of customer data to inform its efforts to improve customer satisfaction: The overall satisfaction survey that customers fill out annually; interviews with targeted customer segments, follow-on surveys, and sessions with corporate advisory boards that seek to identify an initiative that will address a problem hinted at in the overall relationship survey (“this is the ‘digging and understanding’ layer,” says Cunningham); and, at the most granular level, records of each individual transaction that the company’s technical support group has with a customer.

To illustrate how Cisco uses these three layers, Cunningham cites a hypothetical example. Assume that for a given year, the average score for product reliability has slipped a bit. Drilling down to the bottom two layers of data, Cisco discovers a problem with the power supply for its routers. It launches an initiative to solve this problem and identifies the number of spare power supply parts it sends out weekly as the measure it will use to track the progress. The transactional measure—the number of spare parts shipped weekly—may start to come down fairly soon after the initiative has been launched, but it may take a while before the change shows up on the annual relationship survey.

“You need both the aggregate and the transactional information,” says Cunningham. “The survey data tells you about the overall health of your relationships with customers; it tells you which way the wind is blowing. It also helps prevent you from running after individual problems that may not be significant in the aggregate. The transactional data gives the detail behind the relationship.” It helps you pinpoint specific issues that need to be addressed to boost overall customer satisfaction.

Digging deeper

To boost customer satisfaction and, ultimately, customer loyalty, you have to do more than listen simultaneously to customer averages and to individual customers. You also have to look for what lies beneath the externals of customers’ behavior (what they buy, how they buy, and when they buy). “Without capturing what is going on inside customers’ minds and hearts, and integrating that information with the factual external experiences, the picture is incomplete,” says Doug Grisaffe, chief research methodologist for Indianapolis-based Walker Information.

“CRM tools enable you to collect a lot of rich data about a customer’s frequency and time of purchase, the size of her orders, and what she thinks of your company,” says Harvard’s Zaltman. That’s necessary but not sufficient data: It doesn’t tell you anything about “why customers do what they do, think what they think, and why they like or don’t like your products. Getting that level of insight requires more intensive interactions with customers than CRM tools permit.” It requires that you develop a “poetic insight into customers—a deep knowledge that enables you to intuit their answers to questions you haven’t even asked them.”

In one-on-one interviews with customers, Zaltman uses a process he describes as metaphor elicitation to get at the beliefs, emotions, intentions, and often unconscious attitudes that people have about a product or brand. As he explains in his recent book, How Customers Think: Essential Insights into the Mind of the Market (Harvard Business School Press, 2003), the information gleaned from these interviews as well as from surveys and observation is used to create a consensus map—an illustration of the particular bundles of constructs that customers have developed based on their experience and emotional connection with a product or brand.

A consensus map that Zaltman developed for General Motors reveals the richness of the metaphor elicitation approach. As expected, customers associated GM products with quality and competitive price. But there was more: Customers also linked GM with patriotic feelings. By buying GM cars, they saw themselves as not simply helping Americans keep their jobs, but as fulfilling a larger obligation that they felt toward their country.

Once you understand these often surprising bundles of associations, you can reinforce and sometimes alter them with the messages your company sends to consumers.

Based on the consensus map Zaltman produced, GM’s domestic managers redesigned the customer experience at dealerships and added subtle cues in their advertising to make the idea of patriotism more salient. For GM’s overseas managers, the task was more difficult but no less valuable for that. Realizing that GM products also produced patriotic associations among foreign purchasers, the overseas managers “found cues that underscored patriotic associations with the local country without pressing the American button,” says Zaltman.

Reams of customer data are no guarantee that you’ll be able to increase your most profitable customers’ loyalty—you have to be sure that you’re collecting the most relevant information. Listening for the attitudes that inform customers’ behaviors and preferences, Zaltman maintains, gives you “a more solid basis on which to craft and implement strategies that will improve customer loyalty.”

Find it here: http://hbswk.hbs.edu/item/3596.html





Where is Consumer Generated Marketing Taking Us?

9 08 2007

Consumer generated marketing is a fact of life to which all of us will have to adapt. Adaptation means learning how to use CGM to provide one form of input in fashioning product and marketing decisions. Those are the messages from respondents to this month’s column, who seemed to treat what some might think is the most revolutionary concept in marketing to come along in a long time in a very matter-of-fact way.

Bob Nemens commented, “Traditional marketers may be quick to dismiss Internet chatter as coming from the ‘uninformed.’ … If Thomas Edison had been given the option at the time, I bet he would have spent significant time on the online underground.” Fernando Polo dismissed the potential pitfalls of bias caused by listening only to outspoken users of the Internet by saying, “Excuses such as ‘listening to the wrong complaints’ are just that: excuses. Text-mining technologies can now help companies listen to their customers better than ever… My advice: ‘Don’t let your competitors listen to your clients; do it yourself first.’” Andrea Learned pointed out, “Eventually, those slightly later adopters and less-active types will join in to make blogs a more representative discussion vehicle… The same will likely happen in the consumer generated marketing realm when slightly later-to-adopt consumers realize how much they can influence manufacturers….”

The proper role of CGM was a source of some comment. In particular, the findings of a study cited in the column that associated companies utilizing mechanisms for paying attention to “emerging customers” with the fostering of “disruptive technologies” raised some eyebrows. As Christophe Meili put it, “I’m surprised that consumer generated marketing would foster disruptive innovation. I was under the impression that … true disruption would be generated less by popular demand than by hard radical thinking.” Flavius Chircu suggested that if we regard consumer generated marketing as “something akin to the other party in a dialogue … (it) becomes a source of incremental improvements whereas anything revolutionary could only come during the ‘breaks’ in the dialogue.” And Caleb DeGrenier commented that “companies still need to surprise the market with innovative products that no single customer would have thought of.”

This brings us full cycle to some of our original questions about consumer generated marketing. Is it really something “new under the sun”? Is it, for marketers, a disruptive technology in its own right, something offering decision makers more for less (or, more accurately reflecting the definition of a disruptive technology, less for a lot less)? Or is it something to be regarded as providing just one of several important inputs to future product development and marketing decisions involving primarily non-disruptive technologies? Does chatter matter? And how much? What do you think?

Find it here: http://hbswk.hbs.edu/item/4781.html





A Balanced Scorecard Approach

9 08 2007

Happy customers are good, but profitable customers are much better. In this article, professor and Balanced Scorecard guru Robert S. Kaplan introduces BSC Customer Profitability Metrics. From Balanced Scorecard Report.

Find it here: http://hbswk.hbs.edu/item/4938.html





The Box Office Power of Stars

9 08 2007

Just how much do movie stars contribute to box office success? HBS professor Anita Elberse researched the notion of “star power” to better understand how A-list players contribute to Hollywood’s bottom line

Find it here: http://hbswk.hbs.edu/item/5025.html





A Survey-Based Procedure for Measuring Uncertainty or Heterogeneous Preferences in Markets

9 08 2007

People who buy retail prescription drugs, invest funds, or participate in auctions rarely have complete information about the product they are buying. Often the only auction information participants have is the number of bidders, observed bids, and product characteristics. If data from an auction, for instance, is a function of bidder behavior, then external survey data may help in testing hypotheses about bidding behavior. Researchers often avoid using surveys because they consume time and effort, but Yin presents a survey design technique and econometric tool to deal with a general population of survey respondents. Her application tested eBay online auctions selling personal computers. Key concepts include:

  • Survey data may be a good complement for market data, especially for auctions, as a measure of uncertainty or different preferences.
  • Survey data may be more valuable than other methods of evaluation because it exploits the human ability to assess complex sets of information.
  • A survey may be implemented more quickly with a larger number of respondents, even if they are inexperienced, than with a smaller number of experienced respondents, by correcting for survey bias.

Find it here: http://hbswk.hbs.edu/item/5410.html





Will the “Long Tail” Work for Hollywood?

9 08 2007

The “long-tail phenomenon” is well documented: Amazon.com makes significant profits selling many low-volume books. But can the long tail work for video sales as well? A new working paper by professors Anita Elberse and Felix Oberholzer-Gee suggests that it may not bring the same benefits to Hollywood. Key concepts include:

  • For video sales, the long-tail phenomenon is not as pronounced at it is for books. There is evidence of a shift in sales to the tail for video, but an increasing number of titles do not sell at all.
  • Hollywood strategists have no easy answers for pumping up revenue, given a decline in the number of blockbuster hits. This new research suggests that the long-tail phenomenon might not be a panacea for video sales.
  • The music industry may be more of a long-tail beneficiary than the movie industry.

Find it here: http://hbswk.hbs.edu/item/5520.html





How Do You Value a “Free” Customer?

9 08 2007

Sometimes a valuable customer may be the person who never buys a thing. In a new research paper, Professor Sunil Gupta discusses how to assess the profitability of a customer in a networked setting—a “free” customer who nevertheless influences your bottom line. Key concepts include:

  • In multi-sided markets, some customers contribute to a company’s bottom line directly while others contribute indirect benefits, which are more difficult to calculate.
  • Businesses must be able to assess the value of these “free” customers in order to efficiently allocate marketing and other expenses to grow the business, and to develop a more accurate estimate of firm value.
  • Using a model for valuing networked customers, Gupta found that in an auction scenario, buyers and sellers had almost equal value even though sellers outnumbered buyers 4.6-to-1

Find it here: http://hbswk.hbs.edu/item/5595.html





Customer lifetime value

9 08 2007

Donald Lehmann discusses Managing Customers as Investments, a new book in which he and coauthor Sunil Gupta explain how to calculate and apply customer lifetime value.

You write that teaching the core marketing course to Columbia MBAs was one of your main inspirations for the book.

During the dot-com bubble, I noticed there were a lot of companies with a lot of valuation that I knew was just not sustainable. Basically, the students were less than enthusiastic when greeted with that news, so I decided to prove to them why. The basic proof was this: a business runs on revenue, revenue comes from customers, so if I can project customer revenue, I can project the value of a business. And in point of fact, several of the dot-com companies were grotesquely overvalued, based on any reasonable projection of revenues that would come from customers.

We had a model that basically married together one of the fundamental approaches in marketing, which is to predict life cycles of product diffusion curves — which we use to predict the number of customers — and then straight old extrapolation to project the margin per customer. We put the two together. So our theory, if you want to call it a theory, was that customer growth would not continue forever, that at some point it would level off.

How does your approach differ from previous methods of valuing customers?

Most people have not valued customers in the past. Those that have are people in direct marketing and direct mail, in particular, who have a model called RFM: recency, frequency and monetary value. So, you measure how recently a customer has been with you, how frequently they buy stuff from you and how much money they spend on it, and you use that to get some sense of how valuable a customer is.

We took the discounted cash flow paradigm and used that to estimate the value of an individual customer. So we simply project into the future the revenues and costs at a customer level and then figure out what that customer is worth. To me, it was very logical and quite obvious, and while there are a number of other customer books out there that also talk about that notion, nobody had pushed it as far as we did. In particular, we show that if you sum the projected values of the customers, that number would give you some indication of what the firm ought to be worth. That was the unique link.

The closest to this has been what the direct marketing people have done, because they have terrific data sets on individual customers. We were looking at aggregate data and trying to get a sense of what an average customer is worth. We used basically public information. To say, “We have a great method to measure the value of a company if you can get access to internal company data” is not overly useful.

You used many examples and case studies in the book. Are any especially representative or illustrative in supporting the methods you advocate?

What got us interested in the telecom cases was that the price per customer was jumping dramatically in a series of mergers and acquisitions, which suggests the market wasn’t efficient. So we wanted to project how many customers would a Verizon or a similar company end up with and how much could they expect to make per month, and therefore per year, off them. Project it out, discount it back in present-value terms, add it up across all the customers and see what that company would be worth; or, at the individual customer level, look at what we projected a customer would be worth and compare it to the implicit price from the merger and acquisition. They overpaid, in my opinion.

We also had, for some of the dot-coms, an interesting difference in that some of them were pretty close to our estimates and some of them were grossly overvalued according to our method. One of them is eBay. And you can argue eBay’s got a different business model, because they’ve got both buyers and sellers going through there.

Can you talk more about your method and how firms can use it?

You can use it at the individual customer level to figure out what an individual customer or segment of customers is worth on a per head basis and then relate that to how much effort you spend to acquire and retain them. If a customer is going to generate discounted cash flow profits of $400 over their lifetime, you don’t want to spend $500 acquiring them. And yet, I think an awful lot of companies, because they have not done that relatively simple calculation, have overpaid for customers and either over- or underpaid on retention. If a customer’s worth $20,000 to you and you’re spending $10 a year to retain them, you’re probably not spending as much as you should.

Does your method offer a formula to determine the right amount to spend in acquiring and retaining a customer?

The method gives an upper bound. You would not spend more for a customer than they are worth. If a customer is worth $400 to you and you spend $399 on them, it’s a good deal — you made a dollar. Is a dollar on $399 a good rate of return? That depends on the firm’s cost of capital, risk preference, etc.

Is your method equally relevant to all industries?

Yes. A friend of mine at Rite Aid got data on their stores. I think this method perfectly allows you to value a retail chain. All you need to know is how many stores they’re going to have and how much they’re going to make per store, and that basically is what the value of the chain is. In essence, what people in finance do is project out revenues and discount them back at the aggregate level of the chain. All we’ve done is bring it down to the individual store level and then aggregate it back up.

So for a going business that’s been around for a while, where it’s pretty obvious how many units there are going to be and how much they’re going to make per store, the methods are the same. But if you’re in a situation where none of the stores are making money and you discount that back, you get a negative number, implying that the chain is worthless. The advantage of our method is that we look forward, so we would get a number that makes more sense in that scenario.

How do companies account for investments in customers on their balance sheets? How would you account for this investment?

The accounting rules are such that you do not account for the value of customers or the value of brands, which together in lots of organizations make up well over 50 percent of the value of the firm. Most companies, consistent with the accounting regulations, expense all marketing. Sometimes they capitalize R&D, but they expense marketing. We would view it as an investment. If I spend $400 to get a customer or if I spend $400 to get a piece of milling equipment or a photocopy machine, they’re all investments. You get some payback over some period of time. There is some risk that the thing will break down, which is the same as the customer defecting. There’s an annual maintenance cost for a photocopy machine or a piece of milling equipment or to retain a customer.

Have you noticed any change in firms’ behaviors as a result of this book? What would you like to see change as a result?

Well, I think firms should be much more rigorous in evaluating strategy through some kind of metric. I think customer lifetime value is a very useful metric. It’s not the only one I would use, but it’s an important one for evaluating decisions, certainly merger and acquisition decisions. Let’s assume Harrah’s has decided they want to get more customers to their casinos. You know how much it costs for the program they plan, whether it’s a TV ad blitz during the Super Bowl or direct mail or whatever. How do you figure out if that makes any sense?

One thing you can do is say, “I know what new customers are worth to me. I have to get so many new customers to break even to justify this expenditure — is that reasonable or not?” Often, when you look at that question, the answer falls into one of two categories: “Of course it’s reasonable, that’s going to be easy,” which means you spend the money in a hurry; or, “There’s no way we can generate that many customers from this campaign,” in which case you can save that money.

Donald Lehmann is the George E. Warren Professor of Business and Sunil Gupta is the Meyer Feldberg Professor of Business at Columbia Business School.





Defaults make a difference

9 08 2007

People sometimes sign up for things and then opt out later. Or they opt out now and opt in later. In both cases, they change their decision. Does it matter? In some cases, no, but in other cases it matters a great deal.

Take organ donation: when you renew your driver’s license, you can sign a card that makes you a potential donor. Can hospitals that handle organ donations rely on your pledge, and if so, to what degree? And what about people who don’t sign up — do they actually opt in at a later date? Knowing who will come through and who will not — and how best to sign them up — could help hospitals plan how many needy patients to put in their pipeline.

In organ donation, these are matters of life and death. In other domains — like flight insurance, retirement savings or Internet privacy — the stakes are lower but still high enough to make it worthwhile to look for an answer.

Professor Eric Johnson worked on this problem with Daniel Goldstein, using the Virtual Laboratory of the Center for Excellence in E-Business at Columbia Business School. They ran experiments over the Internet that gave hundreds of people essentially the same choice but in two different forms: (A) agree to be a donor, with an opt-out clause, and (B) decline to be a donor, with an opt-in clause. The researchers expected some difference, but the size of the spread shocked them. A’s outnumbered B’s by a factor of 2 to 1; people were twice as likely to agree to be a donor when they had to opt out as when they had to opt in.

Further research on different countries showed similar results. Rates of donor agreement and actual donation were low in Denmark, Germany, Netherlands and the United Kingdom, where potential donors had to opt in. These rates were much higher in Austria, Belgium, France, Hungary, Poland, Portugal and Sweden, where potential donors had to opt out.

In many situations, which default you build in makes a big difference. If you want people to do something in the future, ask them to agree to it now, with an opt-out clause. The default option — where they take no further action — is then in your favor. Johnson and Goldstein noted this result even in simple online agreements, where the default is a box already checked and the viewer can opt out by unchecking the box. That approach yields more positive results than asking the viewer to check the box.

The principle behind the results of this research might have even wider implications. When people see an option for the first time, they don’t yet have a preference one way or the other. Instead, they construct both the problem and the solution right there and then. So how you present the question — opt in or opt out — makes them see the whole matter in two very different lights. This is true for minor items like online offers and for major decisions like how much to save for retirement — and even, as we see with organ donation, for questions of life and death.

Eric Johnson is the Norman Eig Professor of Business and director of the Center for Excellence in E-Business (CEBiz) at Columbia Business School.





Emotional accounting

9 08 2007

In purely rational economic terms, money is fungible. It shouldn’t matter where the $20 in your wallet came from, whether you earned it at a job or found it on the street. But people act as if it does, and in the 1980s the concept of mental accounting emerged. According to this concept, people categorize money they receive by its source, and deposit it in different mental accounts. Money received from a windfall such as winning the lottery would go into one account, for example, whereas money received as income from a job would go in another.

Mental accounting explains why investment bankers tend to spend their bonuses on plasma TVs and exotic vacations but save money from their salaries to buy homes. Over the past few years, Professor Jonathan Levav, working with A. Peter McGraw of the Leeds School of Business at the University of Colorado at Boulder, pursued this idea further and found that in addition to mental accounting, people tend to categorize money according to the feelings they associate with it, a process he calls emotional accounting.

To illustrate how we engage in emotional accounting, Levav compares two scenarios: receiving $200 as an unexpected gift from an aunt and receiving $200 as an inheritance from an aunt who just died. Although the money is from the same source, in the first case it triggers positive feelings, while in the second it produces what Levav terms a “negative affective tag.”

The way people evaluate money becomes more complicated when mixed emotions are involved. Suppose an investment banker received a bonus but knows that a colleague who didn’t work as hard got more money. In this case, the banker is glad he got a bonus but also angry because he feels he was treated unfairly. Meanwhile, a banker who received a bigger bonus than one of his close friends may feel more guilt than happiness.

To assuage such negative emotions, Levav says, people employ various cleansing and avoidance strategies. “If I have negative feelings about money, then I’ll launder it of its negativity,” he says. “This can mean spending it in ways that are virtuous or utilitarian. So I don’t buy the plasma TV for myself, but I might buy one for an orphanage. It’s not just about the product; it’s really about the use.”

Levav and his coresearcher conducted several studies that tested how university students spent money they received under different circumstances. In one experiment, students who completed a market research survey were given a choice afterward of different $2 coupons. They could spend the coupons either on ice cream in the cafeteria or on books in the university bookstore. Half of the students were told that the grant for the coupons came from the computer firm Dell, which had positive or neutral associations within the student population. The other half were told the grant came from the tobacco company Philip Morris. About 44 percent of the students who were told the coupons were paid for by Philip Morris chose the utilitarian textbook coupons, double the percentage of those who were told the coupons came from Dell.

“In essence, people tell themselves, ‘Let me do something good with the money so I don’t feel bad about it anymore,” Levav says. When people are angry — such as the banker who feels he was cheated on his bonus — they tend to set the money aside and give their anger a chance to dissipate. People who feel guilty are more likely to donate the money to charity. When teachers at an affluent Chapel Hill, N.C., high school received bonuses based on their students’ standardized test scores, they donated the money to a rural school, and said their students’ performance was partly the result of the community’s wealth. Levav and his coresearcher hypothesize that the teachers’ donation was a way to cleanse themselves of the negative emotions they associated with the money.

“When we make the decision to spend money virtuously — paying off a chunk of our college tuition, rather than paying off debt racked up on a weekend in Vegas — we can erase any bad feelings associated with it,” says Levav. “It may not be rational, but it makes us feel a lot better.”

Jonathan Levav is assistant professor of marketing at Columbia Business School.





What are you looking for in your leader? (3)

9 08 2007

Check out Lao Tzu on leadership. 

Thirty
Whenever you advise a ruler in the way of Tao,
Counsel him not to use force to conquer the universe.
For this would only cause resistance.
Thorn bushes spring up wherever the army has passed.
Lean years follow in the wake of a great war.
Just do what needs to be done.
Never take advantage of power.

Achieve results,
But never glory in them.
Achieve results,
But never boast.
Achieve results,
But never be proud.
Achieve results,
Because this is the natural way.
Achieve results,
But not through violence.

Fifty-nine
In caring for others and serving heaven,
There is nothing like using restraint.
Restraint begins with giving up one’s own ideas.
This depends on Virtue gathered in the past.
If there is a good store of Virtue, then nothing is impossible.
If nothing is impossible, then there are no limits.
If a man knows no limits, then he is fit to be a ruler.
The mother principle of ruling holds good for a long time.
This is called having deep roots and a firm foundation,
The Tao of long life and eternal vision.

Sixty-six
Why is the sea king of a hundred streams?
Because it lies below them.
Therefore it is the king of a hundred streams.

If the sage would guide the people, he must serve with humility.
If he would lead them, he must follow behind.
In this way when the sage rules, the people will not feel oppressed;
When he stands before them, they will not be harmed.
The whole world will support him and will not tire of him.

Because he does not compete,
He does not meet competition.

Seventy-five
Why are the people starving?
Because the rulers eat up the money in taxes.
Therefore the people are starving.

Why are the people rebellious?
Because the rulers interfere too much.
Therefore they are rebellious.

Why do the people think so little of death?
Because the rulers demand too much of life.
Therefore the people take death lightly.

Having little to live on, one knows better than to value life too much.

Seventy-eight
Under heaven nothing is more soft and yielding than water.
Yet for attacking the solid and strong, nothing is better;
It has no equal.
The weak can overcome the strong;
The supple can overcome the stiff.
Under heaven everyone knows this,
Yet no one puts it into practice.
Therefore the sage says:
He who takes upon himself the humiliation of the people is fit to rule them.
He who takes upon himself the country’s disasters deserves to be king of the universe.
The truth often sounds paradoxical.

Fifty-eight
When the country is ruled with a light hand
The people are simple.
When the country is ruled with severity,
The people are cunning.

Happiness is rooted in misery.
Misery lurks beneath happiness.
Who knows what the future holds?
There is no honesty.
Honesty becomes dishonest.
Goodness becomes witchcraft.
Man’s bewitchment lasts for a long time.

Sixty-five
In the beginning those who knew the Tao did not try to enlighten others,
But kept it hidden.
Why is it so hard to rule?
Because people are so clever.
Rulers who try to use cleverness
Cheat the country.
Those who rule without cleverness
Are a blessing to the land.
These are the two alternatives.

Forty-eight
In the pursuit of learning, every day something is acquired.
In the pursuit of Tao, every day something is dropped.

Less and less is done
Until non-action is achieved.
When nothing is done, nothing is left undone.

The world is ruled by letting things take their course.
It cannot be ruled by interfering.

Three
Not exalting the gifted prevents quarreling.
Not collecting treasures prevents stealing.
Not seeing desirable things prevents confusion of the heart.

The wise therefore rule by emptying hearts and stuffing bellies, by weakening ambitions and strengthening bones.
If men lack knowledge and desire, then clever people will not try to interfere.
If nothing is done, then all will be well.





What are you looking for in your leader? (2)

9 08 2007

By Tran Dinh Hoanh

A.  First, let start with the most simple common-sense definition of “leader.”  Leader is (1) the person who leads (2) a group of people (3) to a destination.

So leadership involves you, your people and the goal.

1.  The goal is what we call “vision,” some destination in the future to arrive, some purpose to achieve.   “Vision” always implies with it “the method to achieve the vision” (because without a method get to the vision, the vision is only a daydream).   So the first obvious element of leadership is the “vision and the way to achieve the vision.”  Brother Thien mentioned this point abut goal (vision) in his message.

Because “vision” always implies “the way to achieve vision,” most people just use one word “vision” to indicate both.

Please note: “The way to achieve vision” is usually very general. Say, Ho Chi Minh’s vision is “Freedom, Independence and Happiness,” which during his life time meant “independence from the French.”  His “way” is that the entire people would fight the French, never stopping, never quitting, until we win.   This “way” is very general. It is not as detailed and concrete as the strategies and tactics used daily during the war, which are of a technical nature and are done by his lieutenants.

2.   Now you and your people.  As a matter of common sense, people follow you because they believe in you and your vision.

They believe in your vision because, after listening to what you say and your vision, they agree with your vision and like your vision.
They believe in you because (1) they believe that you are capable of leading them to your vision.  This is “competence” (or a more general term “wisdom”, or a some more narrow terms– “Intelligence,” “knowledge”).  In other words, They believe that “you know what you are doing.”

People also believe in you because they believe that you are honest, that what you say about your vision and your way is your honest words, that what you say about you is your honest words, and that they can trust your words. So, “honesty” is another core element.  Honesty can also be replaced by other terms, such as integrity, trustworthiness, reliable, dependable, etc.

So, from the point of view of your followers, your leadership has 3 core elements:

1.  Your vision (and they way to the vision)

2.  Your competence (you know what you doing–also known as intelligence, knowledge, wisdom)

3.  Your honesty (also known as integrity, trustworthiness, reliable, dependable)

B.  The above is a look at leadership from the follower’s point of view.  Now let’s look at leadership from the leader’s point of view.

1.  First, of course, you, as a leader, has to have a vision (and the way to achieve vision).

But, how to have a vision that your people really love?  The answer, you have to understand your people’s heart and mind so well that you can design a vision that satisfies their heart’s yearning.

2.  But how do you understand your people’s hearts and minds so well?   Having a PhD in psychology?  Having a crystal ball?  The only answer I know is that you have to truly love your people.  I don’t know of any other way to understand someone other than you have to really loves them.  You may be a good communicator or good analyst, but if you don’t really love someone, the most you can do is to understand a very small facet of her, not the whole of her.  You cannot understand someone so well and so deep without really loving him/her.

(Note:  Many parents may say that they love their children so much that they force all they children to be doctors and lawyers to be better in life.  Sorry, that is not loving your children.  That is “loving your future image of your children” or “loving your own self, loving to be a parent of a bunch of doctors and lawyers.” That is not loving your children.  Same thing with government that runs after its own idea of how its people should be, instead of truly understanding and loving the real people who walk the streets, who have real feelings and real struggles).

Once you really love your people, you should be able to understand them well enough to come up with a vision that fits their yearning.

So, from the leader’s point of view, the second core element is “love your people”(also known as compassion, grace, caring, social responsibility, etc.)

From a true love for your people, you will be able to love properly, like, as anh Shane said, loving everyone of your people equally, loving the entirety of “your people” and protecting it against the destruction by a bad portion of your people, only asking your people to do what you would do yourself, fair in reward and punishment, etc.  All these forms of loving measures flow naturally from true love.

3.  And if you really love your people, you will become competent in leading your people.  Say, if you really love your daughter and she is really sick, and although you are not a doctor, you would be able to do your own research to understand a lot about the disease and about available doctors and hospitals out there, to find the best, the most competent treatment for her.  Competetence is a matter of learning and if you really love someone you will know how to learn and to get the professional help to do the best job for them.

(If you know that you, even with professional technical help, are not competent to be the leader, and if you truly love your people, then you wouldn’t take the leadership position anyway).

Thus, from the leadership’s point of view, competence is a necessity, but a necessity that would flow naturally from true love.  We don’t really need to mention competence separately.

4.  About honesty, I would also that honesty is the most natural thing that flows from true love.  When you love someone, you would be honest with him/her.

So, from the leadership’s point of view, leadership has 2 core elements:

First, a vision (and the way to the vision)

Second, Compassion for your people.

 

If we put the two points of view together in a list and do not distinguish follower’s view or leader’s view, we have a list with 4 core elements of leadership:

1.  Vision 

2.  Compassion (love, care, understanding, grace)

3.  Comptence (wisdom, knowledge, intelligence, effectiveness)

4.  Honesty (integrity, trustworthiness, reliability, dependability)

Please feel free to chip in. 

In the next message I will go over one important point in anh Shane’s list:  Protecting the entirely of your people (by sacrificing a small portion of it, when necessary).  This is probably what brother Hien calls “toughness” and other folks call “Making the hard decision.”





What are you looking for in your leader? (1)

9 08 2007

By AD (Andi) Marshall

Top Ten Prioritized Leadership Qualities, ver 0.1
——————————

———————————
00. Wisdom (somewhat ineffable, but likely comprised of the following qualities, several of which overlap or are interdependent)
01. Wit
02. Grace
03. Kindness
04. Resilience
05. Humble Intelligence
06. Open-minded Skepticism
07. Physical, Mental, Spiritual & Economic Fitness
08. Awareness of Contemporary Domestic and Global Issues
09. Reasonable Degree of Contemporary Legal, Scientific and Technological Savvy

By Mr. Shane Wall

*1. Willing to openly canvass and listen to all opinions, including ones the leader may disagree with.* Only by listening to all views and perspectives can the correct one be found.

*2. Be totally committed to the welfare of the “entity” being led as a whole, not just elements within it.* If only one section of the entity is cared for, human nature will
quickly ensure that the entity disintegrates. This also means that sometimes a leader must be willing to harm part of the whole in order for the whole to become or remain healthy. A true example is the Ship Captain whose ship has an uncontrolled fire in the engineroom. He knows there are 4 sailors still in the engineroom and 195 others safe. He does not know if the 4 are still alive or dead already. He orders the engineroom sealed and the firefighting chemical Halon to be dumped into the compartment. Halon is lethally toxic when it reacts with fire (that’s part of how it works). He knows if the 4 are alive, he has just killed them. He knows if he does not extinguish the fire, he places all
195 others in jeopardy. I know this story is FACT because it happened in the Royal Australian Navy when I was still serving.

*3. Not afraid to make the hard decisions, like the example above, for the good of the whole.*

*4. Able to be self-critical and honest about mistakes or errors.* The member of a sports team who gives their all and is defeated by their opponent because the coach put them in the wrong position or gave the wrong task is not to blame for losing the game, the coach who put there is. The coach must then be able to exonerate the player and take
the blame.

*5. Never asks another to do what he/she would not do themselves*, a.k.a. lead by example or leading from the front. This does not mean the leader has to actually participate, but it does mean that those being led must know that when placed in the same position, the leader DID do exactly what he/she is now asking others to
do, so understands their plight.

*6. Is cooperative rather than combative or manipulative.*

*7. Honest, moral, ethical and upstanding with a sense of justice and what is “right”.*
Nothing loses the respect of the led faster than some misdeed by a leader. Nonetheless, this does not mean the leader cannot have made mistakes, (See 4. above), but just how they handle them. Another true story. On learning that their team leader was simply writing his own reports based on his own presumptions and perceptions and not analyzing and compiling their results and reports as he should have done, the team
simply stopped collecting the information and writing the reports – not a healthy situation for intelligence operators. When I took over the team, they were the worst, most demoralized team and the laughing stock of the Unit. Morale was deeper than Whale doo-doo!

*8. Openly and equitably distributes and shares the benefits and burdens.*
I’ve seen instances where everything is shared equally (a Communist-style model) and others where things are shared according to pre-determined criteria or systems (a Capitalist-style model). From my (limited) experience, it doesn’t seem to matter which method is used, rather that it is open and mutually agreed upon (See 6. above).

*9. Deep understanding of the aspirations, wishes, needs and desires of the led.*
Without this understanding, no leader can ever hope to satisfy these things for their followers.

*10. Willingness to delegate responsibilities, reward success and rectify the causes of failure.*
By letting people undertake important tasks, rewarding them when they succeed and helping rectify the reasons they may have failed, a leader builds trust. From mutual trust comes teamwork. From teamwork comes success. Any team-building guru will tell you that, or something similar.

Finally, I don’t remember where this comes from, but I remember a definition of “Leadership”:

_*”The ability to make others willingly do what they otherwise do not want to do.”*_
(to be continued)





What needs for a career in MR

3 08 2007

 

 

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Communication skills. The first skill set we address is the presence of communication skills. Writing skills appeared most often (44%), whereas oral/verbal communication skills appeared in 34% of the ads. Presentation skills, report preparation skills, and general communication skills were found to be important, as they were mentioned quite frequently: 32%, 30%, and 28%, respectively.

Research skills. Not surprisingly, research skills had a very strong presence in our sample of ads, with data analysis (quantitative) skills appearing most often: 60% of the ads. This was followed by research design/methodology and data interpretation skills—at 38% and 35%, respectively. General qualitative research/analysis skills were mentioned in around 17% of the ads, and sampling/data collection skills and questionnaire design skills were mentioned in 20% of the ads.

Analytical/conceptual skills. Although more than 35% of the ads directly mentioned analytical skills, only about 2% of them mentioned conceptual skills as a desired candidate trait. A little more than 17% of the ads mentioned both problem solving and detail orientation.

Interpersonal skills. Colleague relationship/teamwork skills were included in a large percentage of the ads (42%), although these skills were not as pervasive as expected. It is also interesting to note that an equal number of employers needed client management/customer service skills (40%), whereas only 14% needed vendor relationship (management) skills. About one-fifth of the ads requested some sort of general interpersonal skill to round out this category.

Program management skills. Although nearly one-third of the ads requested general project management skills (33%), far fewer required any specific program management skills. Several ads mentioned time management skills and the ability to manage multiple projects (19% and 16%, respectively), whereas only 8% of the ads mentioned more general multitasking. Like other skills, we believe that multitasking is an ability that most employers assume. Therefore, they might not mention it as a skill.\

Computer skills. The most commonly mentioned computer skills were very general ones, with 32% of the ads mentioning the ability to use Microsoft (MS) Office products. Although SAS (a statistical analysis system) and Statistical Package for the Social Sciences (SPSS) are generally recognized as industry standard data analysis software packages, only 11% and 13% (respectively) of the ads mentioned the need for skills in using them.

Other skills. Roughly 43% of the ads mentioned general management skills, whereas other skills were mentioned much less frequently. For example, approximately 18% of the ads mentioned both the ability to work unsupervised and business opportunity identification, whereas about 11% of the ads mentioned sales/account management skills.

Skills required for senior management level position:

  • Nearly every ad (98%) has an experience requirement.
  • Interpersonal skills become even more important at this level (86%).
  • Although management and leadership expectations are higher than in lower positions, research skills are still important.
  • Not surprisingly, computer skills are mentioned least for these executive roles

Skills required for mid-management level position:

  • In almost every category, mid-management level positions fell between the junior and senior management level position requirements.
  • The only category in which the mid-management level positions were ahead of junior or senior management level positions was the program management skills area.
  • In the knowledge area category, a large increase is noted from the junior level positions to the mid-management level positions.
  • Interpersonal skills become much more important at this level, whereas computer skills become less important.

Skills required for junior level position:

  • Experience and education are very important position requirements.
  • Research and communication skills are critical.
  • Interpersonal skills and computer skills are needed, but project management skills are not mentioned as often.

Tips

  • Individuals aspiring for senior research positions must concentrate on further sharpening their communication and interpersonal skills, so as to become attractive for higher level positions.
  • There seems to be a general trend to develop a “sector” or industry focus to better serve the research needs of the end users. Such efforts must clearly be balanced against the risks of unnecessary “overspecialization” and prevention of cross-fertilization of research skills.
  • As oral and written communication skills are essential in lending credibility to competence, academic programs should ensure that the quality of candidates’ presentation styles, interaction abilities, critical thinking, and writing skills reflects the knowledge they have acquired.




Marketing research, by AMS

21 07 2007

I. Opinion & Marketing Research Industry

  • Marketing – The act or process of buying and selling in a market; or the commercial functions involved in transferring goods from producer to consumer.
  • Opinion – A view, judgment or appraisal formed in the mind about a particular matter; a generally held view; or a belief stronger than an impression and not as strong as positive knowledge.
  • Research – A scholarly or scientific inquiry or investigation; or to study thoroughly so as to present in a detailed and accurate manner

There are two basic types of research:

  • Quantitative Marketing Research- Research used to statistically estimate the view points of a population providing estimates of percentages or averages. This research usually employs large samples and takes small amounts of a respondent’s time. Telephone, mail, intercept, door-to-door, Internet or Web surveys, central location tests, mystery shopping and in-home use studies are all used in quantitative research.
  • Qualitative Marketing Research – Research that yields an in-depth understanding about an issue. Qualitative research typically focuses on a small number of people. Since these people are interviewed in-depth, interviews tend to be longer and are often unstructured. An outline of discussion points, rather than a questionnaire is often used. This type of research also tends to be conducted in person, either in focus groups or one-on-one interviews, although the Internet is a growing medium.

Marketing Research Core Body of Knowledge (MRCBOK©)

The Marketing Research Core Body of Knowledge (MRCBOK©) represents the fundamental principles and essential skills that compose the marketing research process. MRCBOK© wasn created in response to educational needs expressed by the marketing research community.

  • Marketing Basics and Its Interface with Research
  • Planning the Research Process
  • Research Design
  • Sampling
  • Data Collection Methods
  • Measurement Instruments
  • Data Collection Skills
  • Data Analysis
  • Communicating Research Results
  • Research Management
  • Web Survey Research and Data Delivery Methods
  • International Research

II. Companies Involved in Marketing and Opinion Research

The marketing and opinion research profession has many different types of companies, as well as consultants, involved in the day-to-day activities of the research process. These include:

The End User/Research Initiator/Research Buyer
The end user/research initiator are manufacturers, retailers, service providers, politicians and other private or public concerns that require information in order to make knowledgeable marketing and business decisions. Virtually every industry is a potential end user of research.

Sample Titles/Positions Available:

  • Director of Marketing
  • Director of Marketing Research
  • Brand Manager
  • Marketing Research Analyst
  • Research Manager Full Service Research Company

Full service research companies specialize in the design, implementation, data collection, data processing and analysis of the information and recommendations to the end user. Full service research companies can provide qualitative and/or quantitative research to their clients.

Sample Titles/Positions Available:

  • Account Executive/Director
  • Project Director/Manager
  • Research Analyst
  • Field Director/Manager
  • Sample Specialist
  • Moderator

Consultant

Consultants are research professionals, who with years of experience, specialize in one or more areas of expertise within the research community.

Sample Titles/Positions Available:

  • Focus Group Moderator
  • Auditor for Research Studies
  • Field Director
  • Field Manager
  • Research Analyst

Data Collection Company

Data collection companies specialize in collecting data, utilizing the methodology designed by the end user, research supplier or consultant. Data collection methods include interviewing of consumers and professionals, recruitment of respondents for focus groups or individual interviews and central location testing.

Sample Titles/Positions Available:

  • Project Director/Manager
  • Field Director/Manager
  • Telephone Supervisor
  • Field Interviewer
  • Telephone Interviewer
  • Computer Programmer

Data Processing Company

The data processing company compiles the data and puts it in a specific format that will enable analysis of the information gathered by the data collection company.

Sample Titles/Positions Available:

  • Coder
  • Data Entry Clerk
  • Data Processor/Tabulation Specialist
  • Programmer

Vendors/Service Providers

Vendors are companies that supply products and services to the marketing and opinion research industry, such as software, equipment (CADI, CAPI), sampling, and technology (videoconferencing, IVR, etc.).

Sample Titles/Positions Available:

  • Sales/Account Executives
  • Account Representatives
  • Account Service Manager

III. How to Enter the Industry

Consult our classifieds and internship listings for a variety of current jobs/positions that are available to marketing and opinion researchers.

Possible Degrees

  • Marketing Research
  • Business Administration
  • Liberal Arts
  • Statistics/Math
  • Qualitative Analysis
  • Computer Science
  • Social Science
  • Communications

Helpful Skills

  • Previous business experience (internship)
  • Analytical, selling or interpersonal experience
  • Experience in design, math and statistics
  • Conceptual writing skills
  • Attention to detail
  • Presentation skills
  • Basic computer skills




Hello world!

21 07 2007

Hello world!