Memo to Big Business

Selling to small business is not just about finding a mailing list and hiring a call centre. It’s about knowing your market.

Case in point: I just got off the phone with Wells Fargo. A cheerful representative with a strong mid-west U.S. accent called to tell me that because of my business’s outstanding “profile” (i.e., they rented a list), I was eligible for a line of credit of up to $100,000. At prime plus 1.5%, which is pretty generous.

But of course they made the usual mistakes. They pretended that I had earned this privilege, when I clearly had not (my business is unincorporated, has no assets and has virtually no capital requirements). Please: if you want to earn my trust, don't start by lying to me.

Plus, they let someone call me who has a grating foreign accent. It was a mild one, to be sure, but why not use a Canadian call centre? We're a proud nation here: why not make it sound more like you actually have a presence in (and thus a commitment to) Canada?

They did some things right, though. When I said that I already have a credit line (from a Canadian bank) and didn't need hers, she was very cool about it. She asked if I would like to note down a web address and an invitation code that would let me take advantage of their offer some other time.

Why don't more people do this? It’s a marketing win-win – it lets the uninterested consumer off the hook quickly, yet it gives them a second chance to think about the offer. So I said, sure.

She then read out five numbers. I wrote them down thinking, "Good for them – they kept this simple." They were respecting my time. But then she read out four more numbers. Then three more. Then three letters. Why? With 15 digits, they have enough codes for everyone on earth, along with everyone who has ever lived on the planet. Plus everyone who ever will.

Moral: Making things easy for business owners is crucial. But you have to do in all ways, not just some.

Ugh! Marketing

I need a new chair mat. Before I headed out to to buy one, I checked the website of Office Depot Canada to see if they're doing anything special for "Boxing Week." Sadly, the site remains as dull as it is the other 51 weeks of the year.

But check out Office Depot's U.S. site.

It's full of colour, pictures, and discounts. Also known as, reasons to linger and reasons to buy. What have Canadians done to deserve such lacklustre merchandising? Business owners deserve special prices, promotional deals and exciting new products. Where's the pizzazz?

In a recent survey cited at a November Warrillow conference on marketing to small business, Staples Business Depot ranked as one of the top brands for business owners. Too bad Office Depot isn't giving them much competition.

Winning the "Space Race"

Congrats to Encelium Technologies Inc., winner of the 2007 “Markham Space Race.”

And congratulations to the organizers – Town of Markham, Innovation Synergy Centre in Markham (ISCM), Great West Life Realty Advisors, FIT by Design, and Jim Brown of Colliers International – for creating a contest that promotes small business and actually aims to help promising companies achieve their potential.

Markham-based Encelium develops energy-management systems that help building managers control lighting and other building loads to dramatically reduce energy costs. Last March Encelium made the papers for selling its ECS system to Toronto’s Rogers Centre (SkyDome), which was expecting the system to save it $300,000 a year.

A panel of judges selected Encelium as the Ontario small business “most likely to grow” over the next year, based on its compelling growth strategy. The company wins a $63,100 prize package that includes use of a furnished, 1,000-square-foot Class A office space for a year in the Town of Markham, a telecommunications package from Telus Business Solutions, thousands of dollars in business, legal, accounting, financial and HR consulting services, and printing and furniture moving services.

Maple Lake Ltd. of Markham and Maxxian Integration Inc. of Thornhill placed second and third in the contest.

Telus was the contest's Title Sponsor, with Creechurch International Underwriters, Cushman & Wakefield LePage and PowerStream Inc. as gold sponsors. The Markham Space Race was open to export-focused, entrepreneurial companies in Ontario that have been in business for at least two years and have at least three full-time employees. Participants submitted a growth plan demonstrating how their company is positioned for rapid growth.

This blog rarely quotes press releases, but this next paragraph from the official announcement rings true to me:

"Regardless of the contest’s prizes, [Innovation Synergy Centre CEO Bob] Glandfield emphasizes that every company that participated in the Markham Space Race comes out a winner, just by developing a growth plan – something many small businesses neglect. “Developing a plan that must face the scrutiny of a third party forces a sense of realism into the process. Entrepreneurs tend to overstate the opportunity, and understate the challenges and timelines, when moving to market. Creating and implementing a realistic plan for growth goes a long way in ensuring the future success of a small business,” he said."

Congratulations to the winners and the sponsors for a rare win-win.
(Crossposted to Canadian Entrepreneur.)

Look! Up in the Sky!

On a warm Friday evening earlier this month, Allstream took an unusual approach to marketing its small business solutions: it flew a UFO over downtown Toronto.

From a distance, the helicopter that towed the huge red Allstream banner was almost invisible, so the ad – which was only intelligible on one side – seemed to be free-floating. My two passengers and I in a car headed downtown took some time to figure out that it wasn't an alien invasion, but merely an ad. Then it took a while longer to realize what the message was.

The big red banner got a lot of attention – but was it the right attention? Does the hard-working target market mill around downtown with time to decipher a hard-to-read mystery ad hovering 2,000 feet up? And even if they do, does a sign that basically promotes your brand name do anything to turn prospects into customers?

I doubt it. I don't think this type of ad shows much respect for the needs of its marketplace.

While I’m generally in favor of marketing innovations, I think this one sends the wrong message. If Allstream (the former AT&T Canada, now owned by Manitoba Telecom) thinks its branding in Toronto is so weak that it needs this kind of aerial extravaganza to sell bundled telecom services, what has it been doing for the past four years?

To learn more about Allstream's small business services, click here.

Go ahead, make me feel small

I received an interesting phone message today from UPS, which seems to advocating a candid approach to contacting prospects. The caller’s name has been withheld, because it’s not his fault: Who gave this man a telephone?

Here’s the message that followed his name and phone number:

“If you can get back to me I’d appreciate it. I just got your name from a trade show we did and I wanted to know if there was any interest on your end or if you were just dropping by, to close out this potential lead on my screen here. Thank you very much. I look forward to speaking with you.”

If you ask me, that's taking transparency too far.

Memo to marketers: I don't want to know that I'm just a blip on your screen. I want to know that if you're calling me, you really care about my business, and you have a very special deal for me.

Don't expect me to remember what form I may have filled out at a trade show. And don't think I filled it out so that a salesman would call. If I won the door prize, tell me. If I didn't win the draw and you're just following up on a sales lead, make me a compelling offer.

Don't treat me like I’m a chore – or just another item on a checklist you want to finish up by noon.

It's just one more reason why entrepreneurs keep beating big business: because you have to sweat the details.

"Big money in small business"

Vancouver-based Backbone magazine has a great article on the challenges facing technology vendors selling to the SMB market.

Author Gail Balfour sets the tone by noting that 97% of all firms in Canada are small- and medium-sized businesses. Vendors such as IBM, Dell, HP and Cisco covet the market, but as Balfour notes, for a long time “even the vendor pitches targeting SMBs amounted to little more than a product tweak and a revamped marketing message.”

But this is slowly changing, says Carmi Levy, senior vp, strategic consulting, with Toronto-based AR Communications. “You cannot underestimate the importance of the small- and medium-sized enterprise. Vendors are starting to realize that there’s real money in providing proper support to SMBs.”

Why so much interest in small business? As Levy notes, Internet technologies are making it easier for smaller companies to compete with big competitors, creating a growing market for tech applications. However, big companies have to learn how to service smaller firms.

Among the challenges noted by Chris Ellsay of Ottawa-based Workshift.com:
* SMB customers demand 24/7 tech support, and on a much more intimate level than enterprise clients
* Often they don’t have a dedicated IT person or staff, and are sometimes not very tech savvy.
* SMBs are price sensitive.

Sellers can’t simply downsize a larger product offering and expect SMBs to buy it, says Levy. Vendors need to build packages of products and services from the ground up. Levy says typical SMB customers are driven by “consumer thinking” and emotional impact, not by the “harder-nosed” enterprise attitude.

One more point: Don't think your brand power is going to crack open the SMB vault and keep you there. Changing brands is much easier to do in small biz, says Jayanth Angl of Info-Tech Research Group in London, Ont. “If a [competing] company is going to give them a better solution, [SMBs] are in a much better position to make that shift, whereas in a very large enterprise that is just not as likely.”

That also means that one negative experience can push SMBs to change vendors. “They base the decision more on emotion,” writes Balfour, “and their smaller size allows them to migrate to a new product without much pain or downtime.”

For more on this subject, and how Dell and HP are responding to this market, see the original story at http://www.backbonemag.com/Magazine/SMB_09070702.asp

Why Small Business Isn't Buying From You

To help computer resellers in Canada sell more to entrepreneurial clients, I write a regular column for Tech Data's Tech Times magazine. "SMB Spotlight" looks at how small business owners think, and what makes them buy - or not.

From my first Tech Times column, published earlier this year, here are four reasons why business owners don't buy.

1) They're too busy. This is the same reason they don't return messages or finish half the projects they begin. They work much harder than the average Canadian. The stats show most entrepreneurs work at least 50 hours a week, compared to 35 to 40 hours for salaried sorts. (That’s a difference of nearly two 8-hour shifts a week.) And PROFIT Magazine’s research finds that the CEOs of top growth firms – the companies most marketers most want to deal with – work more than 60 hours week.

2) They’re not listening. Business owners face more challenges and choices every day than most people face in a year. Do I raise my price? Fire that person? Borrow money? Upgrade my ERP system? If you expect them to put everything on hold to listen to your pitch, you're dreaming.

3) They throw loonies around as if they were silver dollars. Many marketers have noted that business owners tend to be more frugal than most corporate decision-makers. They treat their companies’ money like it was their own. Which makes sense, because it is their own. Business owners are as keen to throw their hard-earned cash at new solutions as you are eager to spend yours.

4) Your offer is too complex. Business owners have too much to do, too much to read, too many problems. They cope by tackling the easiest decisions first. If your solution requires too much thinking, chances are it will be put on hold while the entrepreneur looks at simpler problems with quicker paybacks. Your turn may come tomorrow – unless other more manageable problems surface in the meantime.

These are the primary obstacles facing anyone marketing to small business in Canada today.

Fortunately, overcoming them is easy. You can capture their interest by developing trusted-partner relationships, pressing all the right buttons, crafting simple but compelling product descriptions, advertising more often and effectively, and stressing value, value, value, like a jukebox with just one record.

More excerpts from SMB Spotlight will appear here in future.