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I read a great article on marketing for small business owners the other day which got me to wondering.  The author did a really good job providing practical advice on gaining attention and getting prospects to take action.  However, in the teaser for the article, he felt compelled to state that business owners were fooling themselves if they relied on building their business through referral.  Referrals were unpredictable and inconsistent.  I thought his advice was valuable enough without diminishing the value of referrals. 

Which led me to the recent battle that erupted amongst a small group of friends who share articles and insights through email.  Seems a difference of opinion occurred and someone had to win and someone had to lose.  Of course, this “Us vs. Them”, winners and losers philosophy overwhelms the political world, radio and television news, and talk radio.  No discussion anymore; just rebut and refute whatever the other guy is saying, regardless of merit.  Just look for any way to attack them: misused word, misplaced comma, minor factual error. 

So all this animosity and adversarial activity got me to thinking about how we perceive our business competition.  Being in the world of small business, we are very close to customers and competitors.  And if your market is “anyone who…”, then you probably feel like you have a lot of competition.  So in order for you to get business, people must recognize your worth and the shortcomings of your competition, right?  But your value is not valuable to everybody. 

Thus the importance of clearly defining your target market.  Taking the time to do so is essential in helping you determine your value (your USP.)  How do you differentiate your product and yourself from the competition? 

But beyond differentiation, another value of knowing your competition is in identifying how you might be able to work together with them.  My friend, Carol Shepherd, likes to talk about “coopitition.”  Identifying what you do well and areas of strength and weakness in your competitors may offer opportunities for you to gain business from those that appear to be competitors.  This opportunity may result from a specialty, qualifications, geography/location, capacity, or a host of other differences.  A small IT outsource firm I know grew their business by sub contracting out jobs to competitors until they had the capacity to do them themselves.  They hired engineers only after obtaining enough new business to consistently employ an addition to their staff.    

Taking a close look at your competition can be helpful to your business in a number of ways.  Do you know your competition?    

It’s a soft snow, but more than enough to block the view I expected this morning: the ridge across the valley and the White Mountains behind that. Wanted to see the snow on Mt. Washington but don’t have to look that far to see snow this morning. Yesterday was dark, rainy, and cool but we got the full view, with clouds just bumping the tops of the hills. This 2-3 inches would paralyze us back in Atlanta. Ah Spring! I asked my nephew if he knew the guy who was responsible for this and he allowed as he did and he’d be talking to Him today, as he always does.

Mexico, Maine-Welcome To Town

All 4 Fast Forward Main Street communities share the common issue of dealing with economic stress. But the Androscoggin Valley’s struggle has been a long one, not the result of a sudden event like a hurricane or severe economic down-turn. The other areas are urban while this is rural, the combined population of the 3 towns less than 12, 000. These folks are the tough, quiet types you’d expect to find in Maine; hard working, honest, and generous. They’re also hard people, handling what comes their way, kind but slow to befriend. They want to know who you are and why you’re here and they ask some hard, direct questions. They’ve seen my kind before and they don’t want to be disappointed again. They’ve had enough of that. Just want a chance to work, take care of their families and enjoy God’s blessings.

Rumford Falls, Androscoggin River

So FF Main Street is off and running in Rumford, Mexico, and Dixfield, Maine. We’re honored to be able to work alongside our new friends. Looking forward to the hard work ahead.

Just back from a week in New Orleans. The City has pretty well lost its collective mind…but in a good way. This coming Tuesday is Mardi Gras. Last Tuesday was Lombardi Gras. And the parade was, by all estimates, larger than any Mardi Gras parade; 800,000 in a city of less than 500,000. Businesses set the holiday watch on Monday and Tuesday. And wherever you went, the uniform of the day was Black and Gold and the greeting of the day was “Who Dat!” Seems like they will never tire of saying that with all that it implies.

And what it implies is that a city, once the center of commerce in the South that had been left behind by her sisters in Georgia, Florida, and Texas; a city that had become a cliché as a “Third World Country” with the highest murder rate in the U.S.; a city with a joke of an public educational system and local government; a city that was dealt a near death blow less than 5 years ago; and a city clinging to its NFL team that spawned fans so ashamed they wore paper bags on their heads and dubbed the team “The Ain’ts”, is claiming respect.

This Super Bowl victory comes at an auspicious moment in the history of New Orleans. Recovery is strong, to the extent that they experience one of the lowest unemployment rates in the country, a growing economy, a wild west entrepreneurial atmosphere, a resurgent school system and neighborhood spirit, and most importantly, an election that truly is “Change”. New Orleans has been named in a number of national publications as one of the best places to start a new business and, surprisingly, one of the best places to live. Much of the old guard that helped to build a reputation of Banana Republic governance is now looking for work and a new krewe of young, progressive leadership is taking the helm.

And there’s the Saints, the eye of the storm. All that is positive in the city is encapsulated in their story. The metaphors are abundant. Cast offs and the unheralded, the new and untested, the old and forgotten, brought together and formed into a team that surprised all but the most stalwart of the Who Dat Nation. They were resilient and relentless. They were bold and innovative. They were inclusive and made the most of their assets. They are a team that truly represents all of a city that deserves a place in the hearts of Americans, as a part of our American story.

So even if you are a Vikings fan, part of the Cardinal faithful, or avid follower of the Colts, celebrate with a City that is being reborn and taking its place, once again, as one of our great American Cities.

If there is one lesson we all should have learned over the past year or two, it is that the world is not what it used to be. The pace of change accelerates constantly. In our fathers’ times, businesses could come up with a model and stick with it for a long time. “If it ain’t broke, don’t fix it.” “Dance with the one what brung ya.” Good advice when the environment is static for extended periods of time.

However, as we have seen, things are changing rapidly. For anyone who hadn’t accepted that, 2009 had to have been a rude awakening. Today’s great idea may be a phenomenal innovation. But with today’s open source reality, lots of bright people are moving the ball forward quickly. If your forward thinking extends only to the end of the block, you’re in trouble.

What does that mean for us small business types, immersed in the day-to-day chaos of getting the job done? How do we fit strategic planning (Yoicks!!!) into our day?

This is a great place for me to offer a business coach as the solution. And while that may be one of the solutions, networking is another. When we think of networking, we think of referral networks. But there are two others, as defined by Ivan Misner (Business By Referral): Information Networks and Support Networks.

Information Networks are those sources we turn to that help us with the technical aspects of our work and business. They are the professional associations we belong to, the mentor we have, our friend the CPA, the maven (a la The Tipping Point) we drink beer with. These folks help us keep pace with the broad range of information required in order for us do business.

Support networks are made up of people who have an interest in us and our success. They are there when we need them for moral support and encouragement, maybe to jump in at a time of need, or to just generally be there for us. They celebrate with us and help us to keep going when things are tough.

So where do you find these other networks?

I belong to a mastermind group and am fortunate to have a number of business coaches and consultants as friends and acquaintances. I read daily, both history and the current news. A lot of my social conversation is in the realm of the strategic. That is important because in your business the day-to-day pull is to the tactical. Tactics are the ways we go about doing our work; the processes and systems we follow. Generally, strategy is “the carefully devised plan of action that guides us in the achievement of our long term goals.” In biology, strategy is “a behavior, structure, or other adaptation that improves viability.” Hmmm. That sounds necessary if we want to stay in business.

So looking ahead, as we all do at this time of year, what do we see? Is the terrain changing? Will your business remain as it is, or are there changes that you can see coming? And how about the ones you can’t see?

Had a great conversation today with Graham Wickham, President and CEO of the Wickham Financial Group in Marietta, GA. Graham mentioned one of his agents, a new guy, made comment on a book he was reading. It brought to mind part of the definition of a good client for me: a life long learner. I’ve always enjoyed learning new things and reading. That pleasure seems to grow as I get older but I wish I had been more diligent about it when I was young. One of the best bits of wisdom ever imparted to me was by my old mentor and friend, Fred Yeager, of Met Life in New Orleans.  Fred once told me that “We don’t know what we don’t know.”  Kind of the premise of the book I was moaning about some months back, The Black Swan.

As we near the milestone of December 31 and prepare to cross into 2010, we hear the usual wisdom about getting your plan for next year complete. We all nod our heads and our hearts fill with good intensions but, ultimately, some of us will plan and most of us won’t.

I’m not sure what works for you. I do know that one needs to pause and reflect occassionally on what you are doing. Because as a business owner or independent sales person, you are sliding behind if you are not learning and adapting. The pace of change keeps increasing.

Discussions regarding the economy break out at the drop of a hat these days. Are we still struggling in recession? Are we in recovery? If we’re in recovery, what is the pace of it, how long will it last, is it temporary? And on and on. While staying current with all that, the most important question to consider is, “What does it all mean to my business and what do I need to be doing every day?”

With all this change and upheaval, it might be a good time to consider your business anew. Is your message (USP, Elevator Pitch, tag line) still relevant? Have customer/prospect needs changed? What are their current concerns and am I speaking to them? Am I providing the right products or services?

We will probably be attending various Holiday parties and functions; good networking opportunities, all. However, while meeting with clients, friends, colleagues, and prospects, this might be a good time to conduct a little market research and find out people’s concerns in the areas you provide solutions. A little Q & A could provide you some valuable information regarding who is in real need of what you provide and what their main concerns are. Maybe it’s time for some chages.

Besides, they will be impressed with what a good conversationalist you are if you let them do most of the talking.

Lots of discussion these days on government cutbacks, both federal and local, in social services. The nonprofit world is buzzing with reports of the hardships being faced by local providers. As government cuts back on services, those in need must turn to the nonprofit community to take up the slack. And of course, with corporate and individual giving down, as well as revenues from endowments down significantly, local nonprofit providers are suffering their own trials. Ripples from the down-turn are still visible on the pond. Being involved in the management of a nonprofit, I see and feel all this directly and regularly.

At the B2B Luncheon last Wednesday we touched on this subject. Toward the end of lunch we have those attending stand and identify themselves. No elevator speeches, 10-30-or 60 second speils, just and introduction so that everyone knows who is in the room. As part of the introduction, we ask everyone to give us some personal information about themselves such as the last movie they saw or the book they are currnetly reading (or the last one they read.) Keeping with the spirit of the season last week, I asked everyone to tell us what they do to “give back” to their community. I can say that I was truly impressed and proud to be a part of this group based on the responses I heard. Seems our community of small business owners and sales people are really socially responsible, heavily involved in a broad spectrum of charitable and service work.

I spoke briefly about the importance of a strong small business community to the strength of the economy in general, as well as to the strength of the local community. How connected are you to the place you live and work? Are you in business just to “become fabulously wealthy, beyond your wildest dreams”? Or are you in business to serve your family and to contribute to the welfare of others (as well as become fabulously wealthy beyond your wildest dreams)? The answers to these questions can help you as you build a business rather than just have a job.

“There was a Saint who had a vision about what it was like in Hell & Heaven.

In Hell he saw a huge table laden with food in the centre. Surrounding the table were starving people who all had very long forks attached to the ends of their arms. They could stab the food, but the forks were too long for them to put the food in their mouths. They were all screaming in frustration as they tried to eat the food that they longed for.

In Heaven, the saint saw the exact same table laden with food & people with the long forks at the ends of their arms. However, here the people were all smiling & enjoying the food. What they were doing was stabbing the food & putting it in EACH OTHER’s mouths!

The moral of the story is that our heaven & hell is right here on earth, how much we want to help others & be helped in return is what makes the difference.”

Thanks to Akhil Shahani, Managing Director of The Shahani Group who posted this on his Ecademy site. Now, how to apply this to business? Any thoughts?

I have the great pleasure of eating breakfast most Tuesday mornings at Matt Capozzi’s NY Deli on Roswell Road over here in East Cobb. The group is an ad hoc group of business people who meet because…they want to. That occurred to me today. And as it occurred to me, it also occurred to me that this unique group results from the culture established by a couple of folks in the group. You see, this group, like many around the Metro area, sprang up fairly spontaneously, not as part of a larger organized network. They wanted to create a group that attracted people who wanted to help each other. Not so unique; that’s what all these network/referral groups aspire to. However, not all achieve it.

At this point, I need to embarrass one of the founding members, Bob Zartarian. Those who know Bob, know him as a very outward looking fellow. He’s always looking for the benefit he can bring to other people. Bob’s attitude is representative of the group and is apparent to everyone who visits and, as a result, we have grown from 5-6 people to over 20. We have few rules but things run smoothly. And, most importantly, connections are made, business referrals are passed. There certainly are others in the group who add to the culture, Cliff, Tim, Peg, Larry, Bill, Ruthe, Eric and other regulars. All there regularly. All there to help each other. We call ourselves TONIC and the group truly is.

When I’m in town, I make it a point to attend. Not just for the business opportunity, but for the camaraderie of truly good people. For those of us who are “Lone Rangers”, working our businesses mostly alone, such company is essential for success. Look around for such groups, whether they are part of a larger organization or a neighborhood group like TONIC. Become a part of one. Contribute.

The good thing about our world is that there is an abundance of opportunity, in every sense. And that includes good people creating good networks.

“The conventional definition (of business): “an organization that makes a profit,” says (Peter) Drucker, “is not just wrong but irrelevant. Profit-making is not the purpose of management decisions, but a test of whether they work.” “There is only one valid definition of business purpose – namely to create a customer.” “The result of a business is a satisfied customer.”

This customer focus is found more and more in business literature, making headway against the traditional sales approach of “interruption” marketing, controlling the sales call and overcoming objections. I won’t say that the internet has led the charge in this change of attitude, but it has certainly played a large role in demonstrating that a customer-focused approach is required these days. Marketing media is ubiquitous, causing more and more of us to tune out. So discovering customer needs and meeting them is essential. Finding a powerful and interesting way to convey this all can be tricky, though.

It’s harder and harder to distinguish yourself in the marketplace and increasingly difficult to get people to pay attention. Becoming a resource for potential buyers is one way to be heard. Having people seek you out because they trust and value your opinions seems the ideal way to position yourself. With creating customers, and satisfied ones at that, as the central focus of your business, it is a natural progression to build business through relationships and positive word-of-mouth.

It is easy to get distracted by objectives and loose site of the ultimate goal. Satisfied customers as your holy grail affects every aspect of your business, from customer acquisition, to product/service delivery, to customer service and follow up.

Drucker’s quotes can be controversial and should stimulate thought and conversation. Maybe even push us into a chicken and egg argument. But the point of it all is that by focusing on satisfied customers, you may have taken the biggest step toward profit.

I’ve attended many sales training programs and one of the topics that always comes up is asking for referrals. I once had a manager who prided himself on his expertise in building business by referral. Every week he would run us new guys through a drill which consisted of a number of questions: How many appointments did you have? How many people did you see? How many times did you ask for referrals? How many referrals did you get? There were some other questions such as, “How many note cards did you get signed?” But I won’t get into that right now. I used to call this the Sales Manager’s Name Extraction Program. It was less about getting referrals and more about getting names.

While the Name Extraction method may work, it is not much more fun than Cold Calling. Everyone feels a little uncomfortable and it certainly is NOT a relationship building exercise with your client or prospect.

In an article, Paula Frazier states that there are three main reasons people don’t get the quantity or quality of referrals they want:

1) They don’t ask.
2) They ask at the wrong time.
3) They ask the wrong people.

I’ll talk about number 3), Asking the wrong people, another time. Let’s talk about numbers 1) and 2).

Asking is important, but asking in the wrong way, asking at the wrong time, or asking the wrong people can lead to unsatisfying results. Before I ask for a referral I always ask myself if I deserve one. What have I done that will make the referral source feel good about introducing me to a trusted friend or colleague? Have I built credibility and trust? Build the relationship so that the idea of them referring you is a natural result, something they want to do. With many people, asking the for referrals before you’ve built a relationship is off-putting and can damage the relationship.

So when do you ask for referrals and how do you ask? What makes you feel like it’s the right time and that you deserve the trust and support of your referral source?