Competition can be a scary thing, but it can also be useful, if handled correctly. Few industries or markets are only large enough for a single player, which means that there is little reason for anyone to be afraid of their competitors. Instead, if companies welcome their competition, they will soon discover that they can benefit one another.

For example, two web development companies might initially think that they are in direct competition. However, the reality is that both companies get much of their business via referrals, for which there is no competition. Having a partnership with another company means that each company can quietly outsource their extra work when they’re busy, maintaining a positive outward appearance to their clients.

This can benefit both sides, since idle workers are expensive, so accepting the work, even at a reduced rate, benefits both businesses. Likewise, the ability to get additional workers when needed on an ad hoc basic minimizes the expense of keeping a large staff.

There are other ways as well in which companies can not compete, for example, targeting slightly different markets, or offering variations on the same service. In either case, there can even be the ability to share clients, allowing each company to focus on what makes them different from their competitors, instead of getting hung up on what makes them all the same.

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These are common spins on how to set your business apart from the competition, but we wanted to take this a step further. Eventually, we landed on offering a custom service that would be given to her clients at no charge, for as long as they were her clients. In the short-term, this might have reduced the amount she could charge each client, but it would also ensure that clients would stay with her for many years.

Working in IT, I went to determine how complicated it would be to build the web application we envisioned. I came back a day later and realized that the application itself, what we had considered to be a unique value proposition for one business, could actually fill a void in the market. That is, many of her competitors and non-competitors (i.e. people offering the same service to a different geographic market) would love such a service, and would likely pay to use it.

The assessment continued to the point where a price could be placed on developing the application, as well as sales models for it (usage and membership fees), as well as marketing angles (it’s a B2C service, so market it to other businesses). The whole business could actually be run in conjunction with her existing business, taking little effort to set up new users on the system (most of this would be automated), but would require significant effort upfront.

What ended up happening is that a business was created for the sole purpose of giving a unique value proposition to ONE client. However, anyone who wanted to use the business, even competitors, could do so – but for a price. That is, we found a way to get the competition to pay to be the competition.

When looking at a business, and its approach to attracting customers, sometimes it will be discovered that something that was added to the business to make it more appealing is actually part of another business. When that’s the case, it might be smart to spin that part of the business off into its own entity, so that you can charge your competitors for using what you give away to your clients.

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With recent developments, the nature of the products was changing, and it was realized that this person is actually a fantastic marketer, but not a salesman, much to many people’s surprise.

The difference between the two, however, is quite important, and in growing businesses, these two roles will eventually diverge from one another.

The marketer is concerned with getting people to look at the product, to consider its merits, sometimes in light of competing products. He listens to what potential customers are saying about the product, and requests changes to be made to the product. He does not, however, work with real products, but rather with demo versions, wish lists, and spec sheets.

The salesman deals with a completed product, getting people to actually pay for it. He will follow up on leads created by the marketers to get people to pull out their credit cards and pay. He will work on pricing models, support contracts, and return policies. He will focus, in short, on getting the working product into the end user’s hands.

The skills needed for both these roles are similar, but not the same. If you see your product struggling to be adopted by your target market, think about whether the problem is one of knowledge in the market at large, or in closing deals. Do your potential customers know about your product, and how it fits into their view of the world? If not, the problem is likely one of marketing. If, on the other hand, people know about the product but are not buying, then your problem may be in sales.

Knowing your problem is one of sales at least gives you a place to start your research into why people are not buying. It might be because you don’t have appropriate staff to follow up on leads, or it might be because your product fails to fulfill the needs you think it does.

However, at least you have been able to narrow down the problem into a set of solvable questions.

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A day later, I checked the delivery estimation for the system, and discovered that the estimated date of delivery was a month later. While I understood that the delivery estimation was exactly that, it bothered me that a completely standard item would take so long to reach the consumer, and I vented:

My carrying case arrived, but still no laptop, and no change in the estimated date of delivery. Following a phone call to customer care, I was told that they were backlogged with orders for that particular system, and that there was nothing to do but wait. While their support was pleasant, they did not actually solve my problem, and I vented yet again on Twitter, this time naming the company:

Finally, my computer shipped, though there was still no change in the estimated delivery date. This implied that Dell fully expected the delivery company to require 3 weeks to ship something from Mississauga to North York, something patently false. Amused, I posted once again to Twitter, this time as a joke:

What I didn’t expect was to get a response, seeing as I had not been contacted the entire time I was complaining about Dell. However, to my surprise, I was contacted by someone from Purolator, the company named as the shipping company being used for deliveries from Dell:

I responded to Jeremie, if only to see whether or not there was a person behind the post, or if this was another automated responder that saw I had mentioned Purolator:

Minutes later, I got a response, indicating that it was, in all probability, a real person managing the account:

I was intrigued that despite knowing my issue was not with Purolator per se, but rather with the manufacturer, they still offered to make sure that my delivery was made promptly. While the manufacturer was ignoring me, Purolator wanted me to know that they would ensure that they would do their best to create a happy ending.

In case you’re wondering, Dell is quite active on Twitter. A quick search reveals about 20 accounts, most of which are being used to market their products. A few are devoted to other interests, such as following members of the Dell team. There’s an account claiming to belong to Michael Dell (though I would be surprised if it was actually him). But they aren’t listening and responding to the complaints.

Contrast that with Purolator – I had no idea if they were on Twitter, I named them once in conjunction with a complaint about a different company, and they responded anyhow. Once I clarified that I had no issue with Purolator, I did not expect to hear that they would check the order for me – there was no need for them to do that, but they reached out anyways.

Perhaps this was because they realized that I could and would vent about poor customer service, but I think it goes beyond that – they actually care. They want to make sure that the end of every customer’s experience is a happy one, and they’ll reach out in order to be able to do that.

Purolator figured out what Twitter is all about. Dell? They’re still in the world of paper, radio, and TV.

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What fascinated me about all this is the fact that I’ve recently been reading the book Blue Ocean Strategy by W. Chan Kim and Renée Mauborgne (click here for my brief review of the book), in which they address this exact problem in marketing. To break their book down into its most basic pieces, the authors describe two fundamental methods of marketing a new product or service.

In the one method, which they title Red Ocean Strategy, the creator of the product or service is looking to compete in a predefined market for which there are already competing products. As an example, a business might create a new travel mug, and try to sell it in coffee shops and housewares stores. They will compete against all other travel mugs, comparing size, durability, effectiveness, and price. At the end of the day, though, there are a finite number of buyers for the product, and many of them are already committed to other brands. As such, this is a difficult type of market to break into.

The other method is that described by the title, Blue Ocean Strategy. In this, the product defines a new market, which does not have any competition because the product or service is really that new and unique. One example from the book is that of Cirque du Soleil, which combined the circus with stage theater to create a completely new genre of entertainment. Since it is a new market, the competition is not [yet] relevant, and other forms of marketing the product become possible. In my opinion, the Handi-Tray really has the potential to make use of such a strategy.

The Handi-Tray combines a quality serving tray with an advertising medium, which is fairly unique. While either portion on its own would be difficult to market – there are other (possibly inferior) trays available, and there are many ways to create advertising space in a restaurant. However, the two combined is a unique product. This would, perhaps, create a candidate for a Blue Ocean Strategy, with a caveat – they are still competing against existing trays.

Perhaps on of the approaches they may want to take is to look at event-based advertising to get the trays into restaurants. If, for example, a company is booking an entire restaurant for an event, they may be interested in having the trays featuring their company logo be used during their luncheon. At the end of the event, the trays might be left at the restaurant, or they may be taken away with the patrons. However, the wait staff would have been given a free taste of the new tray, the management would have seen some of the possible applications, and look into buying them.

If you’re looking to start a new product or service, it would be worth looking into new and alternative ways of marketing your product. If you can find a way to do so in a novel way, and the product has merit on its own, you may be well on the way to creating a successful product.

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However, we were thrown a twist when we realized that the site was not being indexed by Google. This was because the search engine was using spiders with US IP addresses, and so they were being rerouted as well. Not only was this not our intention, we were being penalized for following the rules.

Since the site is undergoing a rebuild at the moment, we decided to bypass the issue for the current version of the site, as it would take a significant amount of work to cope with it. However, we looked at the long-term plans for the site, and found a solution.

While we have no intention of defying the regulations, we took a closer look at what those regulations are. As they stand, while the site cannot service US-based users, it can inform them of the service. The solution was therefore to not redirect users, but to inform all users whom we believe to be located in the US that they cannot register with the site, nor can they log in (thereby preventing them from having friends outside the country create accounts on their behalf), but they can browse as guests.

What this achieves is that the search engines, which are not trying to register or actually make use of the service, can now browse the site. Additionally, changes in the regulations would result in a relatively trivial change on the site, with their marketing and promotions already present in the US.

However, the real lesson here is that when faced with a rule or regulation that seems to pose difficulties to your business, remember to read the fine print. You will often find that even without violating the rules, you can still solve the problem you face as a side effect of a random regulation.

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A recent consultant I worked with had a clever way of dealing with this… He claimed his clients were the Department of Defense, and the Homeland Security Department. Think anyone can check up on those references? Hah!

You need to get at least 1 customer who is willing to provide a solid reference before you’re able to deal with a customer like that. As for the the ‘how many’ question, you have no obligation to give them solid numbers… go with vague words like ‘several’ or ‘numerous’.

While the second part of the answer is on the edge of acceptability, the first part has no place in a business that intends to be around for a while. Once the lies start rolling, it becomes difficult to stop. Additionally, at some point in time, one of those lies may rear its ugly head, usually at a most inopportune time.

While a methodology in business centered around acting larger than you currently are has come to be an accepted practice, it does not come at the price of lying. Rather, it is from the perspective of having the right mindset for a larger business, if that’s where you’re trying to reach.

In regards to this specific question, then, the appropriate response would be more along the lines of a “small but enthusiastic client-base” which does not specify size, but does admit that it’s not very large. Having one or two clients who would be willing to give you a strong referral can help reinforce this.

However, when you work with clients, you must act larger than you are. That is, the communications must all be extremely professional, follow a process to ensure that any issues are properly handled, and so on. That is, you must act as though you were a company many times your current size, so that the clients will respect you for where you’re going, not where you are today.

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My wife registered as a Fitness Instructor, and is running a few classes in the area. As she just started running a couple new classes, she wanted to make sure that enough people knew about the classes to get a decent showing each time. This is where I came into play.

While she focused on getting her classes set up, finding a new location for each one, and working out details with the various locations, I thought about her ability to market herself online. She already had a page on Facebook from some previous classes, so she quickly posted an advertisement there.

Next, we registered her domain name – lindsaykochman.com – to make sure that we had something to start with. While she may not always use her own name for her business, it would buy her some time until she decides what name to operate under. Additionally, with her name becoming in use and people searching for her online, it is prudent to own your own name online.

She would need more than a domain, though, she would need a website. Nothing terribly fancy, but a place where she could post her class schedule, push out additional information about herself and the classes she runs, and most of all, begin working on her mailing list. For all this, the answer was a basic hosting plan with WordPress running on it. The famous 5-minute setup actually takes a little longer in elapsed time, but also means that once set up, she could manage the content of the site on her own.

A couple hours after starting, she had a website up and running. It included a mail sign-up form (using G-Lock Opt-in), a basic schedule, and some basic information. Analytics for the site were added so that she can track visitors to her site, and a contact form to allow people to get in touch with her was added.

The entire cost for this was less that $100, the elapsed time was about 3 hours from start to finish. The result was that she’s set up and ready to go, with all the basic pieces in place for whenever she chooses to use it.

When you started your latest idea for a business, did you put all this into place? What else did you do to help your business get itself off on the right start?

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First, of course, is the kind you pay for – taking ads out in print media, buying radio spots, paying for television spots. You can get online and by ad space on various sites, or run an AdWords campaign. A graphic artist can generate some sleek content, a media company can extend the quality of the various ads.

At the end of the day, people viewing the ads know that you paid for them, and everything in those ads is heavily biased to show a particular point of view.

The other kind of advertising is endorsement from other people. Looking at many sites, you will see feedback posted from former or current clients trying to show how other people approve of the product. Look at the back of books, and you will see excerpts from reviews by well-known newspapers or magazines.

All this, however, is merely a biased selection of endorsements from other people which the author or owner of the business or product has chosed to display. Naturally, they will not choose to print the negative feedback.

However, when reviews are coming from other people, even when the quality of writing or visual impact is not as high as something your own team of graphic artists and writers could have produced, the impact to the audience is so much greater.

What does this mean to you?

Good advertising is earned, not bought. In order to get this recognition, there are two things you can do:

1. You can make sure the quality of what you have to present is high, such that when the right person finds your product, they will be suitably impressed;
2. You can make yourself easy to find by promoting yourself (without becoming obnoxious) in the right places.

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At first, this doesn’t seem to make much sense. After all, with the price of the pass being so low, it’s likely that many people will buy the pass rather than pay each time they visit. The park is therefore losing money on most of the passes being sold.

In truth, however, the revenue of the parks does not come from admission (though it does make a small contribution, of course). It comes from the concessions, the games, the food stands. As such, the parks are more concerned with bringing people into the park than they are with how much they charge to do so.

The same system can be applied to many businesses. Stores will place items on sale for below the cost value, just to get customers in the door. While there will certainly be those customers who only come to buy the sale items, many will purchase other items at the same time, having only entered the store because of the sale items.

As a business owner, it is therefore important to understand that there will be times when the price paid for your product or service are lower than you might like. However, you still continue to sell them at the low price, because it brings in more clients. Even if you are losing money on the initial sale, later sales will ultimately pay for that loss.

As an example, a web development company might take jobs to build small websites at low cost to the consumer. This, in turn, results in the name of the company being displayed around the web, and being referred to others. In the long run, the dollars lost on the job are the cost of advertising, and ultimately will pay off.

How are you using loss-leaders to bring in more business? Do you find it to be effective?

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Unfortunately, this is not a terribly effective way of reaching your audience. You reach out to one place at a time, and then see whether or not it worked, and then you try something else.

The alternative is to work outward from the destination, and make the target larger. Similar to practicing shooting, you can aim better, or you can get a bigger target. In the same vein, it is also much easier to get a bigger target.

In your business, how do you make yourself a bigger target? Simple – you make it easier for yourself to be found.

I had a discussion with an SEO programmer who explained the difference between on-site and off-site SEO. Essentially, you want to advertise your website better. What performs the actual searching for your website is a program, so you must make that program think your site is a valuable resource on a given topic. Many people referencing your site will do this, but that’s very time consuming, and can take a fairly long time to work. Making your site friendlier to the search engines, however, can have fairly quick results.

In your business, is it clear what it is your business does? Do you have easy ways for people to contact you? Do you provide answers to the questions people typically ask?

Or are you hunkering down and hiding so that you can get some work done?

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First, for those of you who don’t already know, Alltop is essentially an online magazine rack that displays the latest 5 posts from each magazine (a.k.a. website or blog) in the selection. Those sites are organized by category, and there are thousands available to choose from. You can make a custom page that includes those sites that you’re interested in from the selection available, so that you don’t have to keep searching for them.

In some sense, you might call Alltop a big RSS reader with twist – each feed has been manually reviewed to ensure that it fits within the scope of the site. Yes, you could build your own, and it might not even be that hard – but Alltop is already there, someone else’ responsibility to keep it working, and works really well!

What’s the revenue model? It’s actually quite simple – advertising. Alltop is ranked just over 2,700 according to Alexa globally, so they have more than enough traffic to make this a viable model. There are over 750 topics, each with its own page with available advertising. On the Small Business page, for example, there are 2 large advertising blocks currently populated. A quick look at their advertising page reveals that they accept two sizes of ads, but no pricing information.

Unfortunately, at the moment you’re limited to seeing sites that have been already approved for Alltop in your personalized page. However, you can always submit another site for consideration, and the current selection is quite diverse.

The one other feature that seems to be missing is the ability to search for a particular site. For example, despite the fact that the title of my blog is listed as “Elie Kochman on Business and Networking”, searching for Elie does not turn up any results.

All in all, a great website, with a couple of additional features that may eventually make their way into the site.

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