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>Who are the People in Your Neighbourhood?

 29th September 2008 by gihan

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Understand the relationship that you have with people who interact with your business.

Broadly, they fall into three categories:

The top group, which I call “friends”, are your customers – that is, people who have paid you in the past for your products and services.

At the bottom are “strangers” – those who have never heard of you before. They may have found you through an advertisement, by a referral from somebody else, from the Internet, or by some other means.

The “neighbours” are those who have heard about you but are yet to become customers. They might be, for example, the people on your e-mail newsletter mailing list.

Market differently to each group

Of these three groups, which is the largest? Well it’s most likely to be strangers, of course. And that’s why many businesses spend all their efforts marketing to them.

However, the catch is that they are also the most difficult market to convert into customers. They don’t know you, like you or trust you – yet. So it takes a much more concerted sales effort to convince them to buy from you.

On the other hand, the easiest to convince are your existing customers – your “friends”. People who have bought from you in the past are much more likely to buy from you again. Even if it’s the smallest of the three groups, it might be far more responsive.

To get the greatest leverage from your marketing efforts, make sure you know whether you’re directing it at friends, neighbours or strangers.

You MUST market to each group differently.

For example, most direct mail experts start by writing to strangers, and are happy with a 3% response rate. The other 97% just ignore the marketing – and can even be turned off by it. But that’s OK for “stranger marketing”. However, that sort of marketing is less appropriate when marketing to “friends” – and you certainly can’t afford to upset 97% of that group!

So how do you market to “friends”? Nice and easy! If you’ve built up a relationship, you really don’t have to try hard at all. It might be enough to just tell them about new products and services, and they will jump at the chance to buy them. On the other hand, if you try this sort of “no frills” marketing to strangers, they won’t buy at all.

If you get this wrong, your WILL fail.

I’ve seen many businesses make this mistake – especially on the Internet.

For example, most businesses try to get more “traffic” (that is, strangers) to their Web site, but the Web site doesn’t do enough to “sell”.

I’ve also seen some marketers who do sell to strangers fall flat on their face because they’ve tried to use the same marketing techniques to sell more to their customers (friends). Instead of sending a simple announcement about a new product, they write a long, hyped-up marketing letter that upsets their existing customers.

It’s true that occasionally a stranger will buy from you despite your weak marketing, or a friend will buy again despite your heavy-handed sales letters. But that’s the exception! You’ll get far greater leverage by matching your marketing to the type of person.

So keep in mind whether you’re dealing with friends, neighbours or strangers – and adapt your marketing accordingly.

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Momentum Moves Mountains

 29th September 2008 by gihan

I recently listened to an interview with Mark Zuckerberg, the CEO of Facebook and supposedly the world’s youngest billionaire.

What made this interview interesting for me was not that it’s an interview with a billionaire. It’s not. It’s an interview from October 2005, when Facebook was just taking off as a directory for Harvard undergraduates, but before it became one of the world’s most popular Web sites.

It’s always nice to see things in hindsight. And I was amused to hear Zuckerberg talk about what he thought was the next step for Facebook.

Remember, at the time it was very popular in Harvard, and was just expanding to support other universities. Somebody in the audience asked whether it would then expand across the world (which, in fact, it eventually did). But Zuckerberg said, No. His next big idea was to roll it out to high school students!

He got it totally wrong.

But I come to praise Zuckerberg, not to bury him.

I’m not going to criticise him here for lack of vision. After all, he does have a billion dollars, which is – coincidentally – a billion more than I do.

Instead, I’ll point out that, even though he didn’t get that idea right, he did still did get on the right track eventually. And he did it because Facebook was already an active, growing, thriving Web site.

Here’s the point: Momentum moves mountains.

He didn’t sit on his hands for years, analysing, contemplating, planning, strategising, projecting and cogitating. No, he got started with something, and then figured out how to steer it in the right direction. And even if it sometimes wasn’t quite right, he was still better off than somebody who hadn’t started at all.

So don’t wait until you know how everything is going to turn out. You don’t. And you won’t. Get started now.

This is particularly important on the Internet.

On the Internet, there are some things you just need to experience before you’ll understand how they will work for you. If you’ve never published an e-mail newsletter, put a video clip on YouTube, written an e-book that you distribute through viral marketing, posted to your blog, or recorded a regular podcast, it’s difficult to imagine how they work. You must experience them.

More importantly, starting these things makes it easier to continue doing them.

When you’ve got a blog, you’ll start noticing things to blog about.
When you’ve got an e-mail newsletter due tomorrow, you’ll create the time to write an article.
When you’ve written your e-book, you’ll constantly find new ways to promote it.

So get started! Momentum moves mountains.

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>Skeptoid, by Brian Dunning

 28th September 2008 by gihan

>Brian Dunning is one of the fairest and most reasonable people who speak publicly about rational thinking.

Skeptoid is a written compilation of the first 50 episodes of his podcast of the same name, from the Web site skeptoid.com. It’s almost a word-for-word transcript of those programs (in fact, I’m guessing he wrote the material first and then reads it out on the podcast), but it’s still engaging even for those who’ve heard the podcast.

Each of the 50 chapters is only about 3-4 pages long, but he still manages to squeeze in a fairly rigorous reasoning process each time. The short chapters make it handy if you have friends who believe in homeopathy, pond magnets, the supposed benefits of organic food, the dangers of mercury filings or haunted houses. If they are open-minded, simply open the book to that chapter and discuss the facts and reasoning presented there. Because Dunning takes a reasoned view, it is possible to have a civilised discussion about the topics!

This is also an excellent example of somebody leveraging their expertise between different formats, so it suits different learning styles.

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>Gurus Don’t Need Business Cards

 27th September 2008 by gihan

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As an expert, your most powerful marketing tool is not your business card. It’s not your glossy brochure. It’s not your Web site. It’s not your client testimonials. It’s not any of your collateral material.

As an expert, your most powerful marketing tool is your expertise. It’s your knowledge, your ideas, your intellectual property – and the way you apply it to your clients’ lives and businesses to make a difference.

So the next time you’re doing any marketing, think about how you can demonstrate your expertise, not just advertise your products and services.

For example:

  • At a networking function, instead of just exchanging business cards, offer to send a special report to the people you meet.

  • At networking functions, offer to enrol people you meet in your e-mail newsletter.

  • When you create a new program, training course, or other presentation, first write an article about the problem that it solves.

  • To keep in touch with clients, send a tip sheet of ways to improve (in some way related to your area of expertise).

  • Write a book on your topic area, and use that instead of brochures and flyers.

  • Record some of your ideas, and create an audio CD that you send to your best clients as a gift.

  • Get a video recording of one of your presentations, find five minutes of high-content material, and create a video clip on your Web site.

  • Give your top clients a complimentary half-hour telephone consultation with you.

  • Instead of advertising in an industry magazine, write a regular column for that magazine.

  • Find a colleague who deals with the same market that you do, and write an article for her e-mail newsletter (and vice versa).

  • Conduct an information seminar to educate people about your area of expertise.

  • Make your Web site a resource centre, not a promotional brochure.

Get the idea?

As an expert, you can do much more than just advertising. OK, you might still choose to print business cards. But use them only to give people your contact details. Do your real “marketing” by demonstrating your expertise.

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>Affluenza, by Clive Hamilton and Richard Denniss

 25th September 2008 by gihan

>Hamilton and Denniss present an interesting argument about Australian society: We’re addicted to consumption. They claim we’re more affluent than ever, and the “Aussie battler” image is a myth.

They don’t say there aren’t poor people in Australia; it’s just that we’ve raised the bar considerably on what we consider “necessities” for life. In other words, it’s not only the rich who are getting richer, it’s also the poor and middle class getting richer but still claiming to be poor. The problem, they say, is not being consumers; it’s being addicted to being consumers.

They organise their argument well into three sections: Describing the problem,
outlining some of its (ill) effects; and then proposing solutions. In the first two sections, they present a wealth of statistics and data to support their position. However, the third section – where they propose solutions – is curiously weak, and they offer very little facts or research to support their recommendations.

In fact, they often betray a clear left-wing bias in their proposed solutions, rather than basing them on solid research. This even spills over into mind reading, with ridiculous statements like, “Although not willing to say so, neoliberals believe …”.

In other areas, they are just plain wrong. For instance, in the area of Internet censorship, where I do have some technical knowledge and experience, they say:

“When presented with polling showing that 93 per cent of parents of teenagers want governments to take responsibility for the problem and require Internet service providers to filter content, both the Liberal Party and the Labor Party respond that parents should take responsibility for their children’s conduct. The financial interest of the Internet industry is put before the emotional health of Australia’s young people.”

This conclusion is shamelessly stated without any supporting evidence whatsoever, and without even a basic knowledge of the facts. Australia is one of the few countries in the world that does censor the Internet, and has been doing so since legislation to that effect was passed in 1999. However, technical experts know it’s impossible for this to be an effective solution, and parental control is required. The fact that polling shows “93 per cent of parents of teenagers want governments to take responsibility” is neither here nor there – it simply indicates they don’t understand what that entails.

You could argue that this is nit-picking, but for authors who present in-depth arguments for the first two-thirds of their book, their proposed solutions lack that same depth, and come across as weak and shallow.

Does that taint the book as a whole? Not necessarily, but I’d suggest you read it with a skeptical mind.

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>One Great Idea or One Trick Pony?

 24th September 2008 by gihan

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The theme of this year’s National Speakers Association of Australia conference was “One Great Idea”.

I remember one presentation in particular where the speaker did deliver one great idea. It was an idea about financial management and cash flow that most speakers could implement immediately in their business – and would lead to increased profit almost instantly.

Unfortunately, most people missed the idea!

Although this speaker did have a great idea, his delivery wasn’t great. In fact, a number of people in the audience left early, and I’m sure some who stayed left mentally.

And that was a real pity.

Because it was a great idea. And it could improve their business instantly.

Sure, he could have delivered it in a more engaging way.

But that’s not the point.

Quick question: If you had to choose between a great idea delivered poorly or a showy delivery with no take-away value, what would you choose?

I’m not sure what you’d say. Me? I’d rather get the idea. After all, as one of my colleagues said afterwards, “Wouldn’t you still take a 24-carat diamond, even if it’s in a paper bag?”

Have YOU got one great idea or are you just a one trick pony?

I know other speakers who prance around the stage, delivering a showy, entertaining presentation, but without any interesting, unique and valuable content. That might work as long as they can keep finding audiences for that presentation.

But that’s getting harder to do. Especially now, when clients are looking for other ways to get the same message.

Here’s the point: If you’ve got an idea, you can LEVERAGE that idea.

If you’re booked primarily because of your delivery style and entertainment value, you’re a one-trick pony. And I believe your days are numbered.

On the other hand, the speaker I heard with the great idea could turn it into a book.
Or write a training program and licence it to others.
Or create a 12-month coaching program for business owners.
Or write an on-line course to sell over the Internet.
Or … any number of other things.

I’m sure he’s doing some of these things already.

What about you?

So what about it? Do you have a great idea or are you a one-trick pony? Get clear about your ideas, and you’ll always have ways to make money from them.

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>Cool It, by Bjorn Lomborg

 19th September 2008 by gihan

>Bjorn Lomborg’s second mainstream book (The Skeptical Environmentalist, which I haven’t read, was the first) is stunningly good.

I first came across Lomborg in his presentation at a TED conference, where he makes a compelling argument for not making global warming one of our highest global priorities.

More recently, I watched him interviewed by Tony Jones on ABC’s Lateline, and that prompted me to buy his book.

Lomborg has a simple point: Yes, global warming is a problem, but it’s not a catastrophe; and we can help far more people (the same people who’ll be most affected by global warming) far more effectively for far less money by doing other things.

Naturally, this approach makes him a target from policy makers, greenies, politicians and others who’ve jumped on the global warming band-wagon – especially those who see a carbon tax as the only option. But he seems unfazed, and sticks to his simple – and compelling – message.

For example …

Yes, global warming will mean more people will die from malaria in the next 100 years. But for a fraction of the cost of taxing carbon, we can prevent a lot more people dying from malaria in the next 10 years.

Yes, global warming will cause more floods. But for a fraction of the cost of taxing carbon, we can do more to prevent flood damage.

Yes, global warming will affect poorer nations more than wealthy nations. But for a fraction of the cost of taxing carbon, we can make those nations wealthy enough to manage those problems.

He’s most compelling because he doesn’t try to make other people wrong (except blatant scaremongers, like Al Gore). Yes, he says, the climate scientists are right in warning us of the dangers of global warming. And yes, they will say it’s an urgent problem to fix. And yes, in an ideal world with unlimited resources, we’d address all the problems. But in a world with scarce resources, we prioritise. And he’s saying we’re prioritising wrongly.

He’s not a “global warming denier” (although some critics wrongly say he is), so don’t read this book if you want to read that global warming isn’t real, or isn’t human-made. Do read this book if you want a better perspective on the whole global warming issue, especially if you currently think it’s the most important issue facing the planet today. According to Lomborg, it’s not – by a long way.

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>Create High-Value Low-Cost Products

 15th September 2008 by gihan

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I first started using the Web in its early days (which was only as far back as 1994). There was no Amazon.com, people were just starting to put Web addresses in e-mail, and Yahoo was just a small Web site being operated by two university students from their spare room.

In those days, there were very few commercial Web sites. When commercial Web sites did come along, almost all of them were for promoting businesses. In other words, they were like an electronic brochure. And let’s face it – most commercial Web sites today are still just electronic brochures.

There’s nothing wrong with that, of course. After all, it’s perfectly OK to have a Web site that promotes what you’ve got to offer.

My point, though, is that there is so much more you can do when you’ve got a Web site. In particular, your Web site gives you the chance to build new low-cost, high-margin products – all based on your existing expertise.

Look at that last sentence again: You can create products that have a low cost (to you), but you can sell at a high margin. Some of them can sell for two, three, ten or even hundreds times their cost, which means greater profit for you.

I’ll give you an example …

Suppose you operate a life coaching business, and most of your clients see you for a two-hour personal coaching session once a week. That can be a profitable business, because it mostly involves your time rather than cash out of your pocket. But it’s also a time-consuming business, for the very same reason.

What if you could deliver your coaching without the time investment of spending time with each client? In fact, what if your coaching business was making money even while you were asleep?

Yes, it’s possible – using your Web site.

Over time, you’ve probably discovered a few common principles that apply to a large number of clients. Of course, each client has different requirements, but I’m sure there are some principles that apply to them all – for example: setting clear outcomes, breaking down tasks into small steps, taking action every day, measuring progress regularly, creating rewards for achievement, and so on..

You could use this expertise to build an on-line course, which is based on these common principles that you use. The course is delivered by e-mail, and delivered automatically at weekly intervals.

Of course, this isn’t a substitute for your one-on-one personal coaching. But some people would actually prefer the on-line version – perhaps because it’s less personal, can be done on their own time, is cheaper, or suits their learning style better.

People who visit your Web site could buy the on-line course directly. Your Web site would enrol them in the course, which means that you send the course information in weekly e-mail messages. Of course, this would all happen automatically, so that you’re not spending your day keeping track of what e-mail goes to which person!

Many of our clients are professional speakers, who present at conferences and training sessions to live audiences. Many of them are now using on-line courses to deliver their material in another way.

Does this work for other businesses?

The idea of providing on-line courses isn’t limited to people who sell “information”. Whatever business you’re in, you have the potential to leverage your expertise.

Here’s the key question to ask:

What do you know that you can teach your customers?

When you know the answer to this question, you know your unique expertise. And because it’s something that your customers would like to know, there’s a good chance that they are willing to pay for it.

For example, suppose you operate a pet shop. What do you know that customers would like to know? One example that springs to mind is dog training courses. Some people will take their dog to classes, but others might be quite happy to buy this information on the Internet.

What if you don’t know how to train a dog? That’s OK – get somebody else to write the course for you, and split the profits! Don’t be limited only by what you know – you can also gain leverage by considering what else your customers are interested in, even if you don’t have this expertise yourself.

I’ve talked a lot about on-line courses, and that’s just one example of the type of product you could create and sell on your Web site. Here are just a few other examples:

  • Ask somebody to interview you on various areas of your business, and make these audio interviews available on your Web site. For example, in the pet shop business, you might conduct interviews about health of your dog in winter, how to teach your cat not to scratch the furniture, how to teach your parrot to talk, or what to do with pets when you go on vacation.
  • If you consult to clients over the telephone (coaches do this, as do consultants, professional speakers and other advisers), record the phone calls (with the other person’s permission, of course), and make these available on your Web site for a fee.
  • In some cases, you will require a more visual component, so you can produce short video clips or use photographs to demonstrate certain things. For example, if you sell gourmet foods, you can offer a “recipe of the month”, with step-by-step instructions either as a video demonstration or a series of still photographs.

There’s really no limit to the possibilities when you start exploring them for your own business.

The beauty of creating on-line courses – and indeed, many of the other products you can create on your Web site – is that you do all the work once, and then everything happens automatically. You write all the course material once, schedule it to be sent out at weekly intervals (or monthly, or whatever schedule you choose), and then everything else takes care of itself. It’s the ultimate form of passive income, because it really can make money for no on-going effort.

More examples

I’ll share a few real examples of work we’ve done with clients to help them leverage their expertise. This will help you to get your creative juices flowing for your own business.

The first is Allan Bolton, who runs Quality Health Australia. Allan speaks at conferences and sells on-line courses to corporate clients. When he speaks at conferences, he gives out a password for audiences to get access to on-going health material and on-line courses. You can visit Allan’s site, but you won’t be able to sign up for his courses because they are only available to clients.

Kerrie Mullins-Gunst, at KMG Consulting, offers a free mentoring course on her Web site. By offering a free course, Kerrie achieves a number of things:

  • When people subscribe to the course, she gets to keep in touch with them regularly. This is just like a free e-mail newsletter, but a “course” has more perceived value than a “newsletter”.
  • Potential consulting clients see the quality of the material that she can provide.
  • People who sign up for the free course might be interested in buying other courses later.

David Penglase, who runs David Penglase Seminars, says that his on-line courses have made him “a truckload of money”. David saw the potential for on-line courses right away, and they paid for his entire Web site within three months. He offers courses for sale on the Web site itself, but in fact most of the course income comes from selling them as part of his training packages. He not only makes more money, it increases his credibility because clients see that he can offer on-going value, not just a one-off training course.

The last example I’m going to give you is professional speaker Keith Abraham, who has really put a lot of thought into making this make money for him. Keith recently estimated that his on-line courses have been responsible for bringing him at least $350,000 of business.

Wow! Imagine what you could do with an extra $350,000.

Like some of the other examples you’ve seen, Keith uses on-line courses in a number of different ways:

  • Visit his Web site and you can sign up for free courses (a great way for Keith to keep his name in front of people).
  • Conference and workshop audiences get access to “members only” courses.
  • Keith includes courses as part of his corporate packages, to add value and increase credibility.

Keith gave us one of our best client testimonials, which I’m happy to include here:

“You would be crazy if you didn’t use Gihan’s CourseBot software. We have over 6,000 people log on receiving emails of information from us every week. For the small investment, I can remember winning one project worth $120,000 that was because we had this software.”

This could create huge profits for you!

Don’t underestimate the value of creating on-line courses and other Internet-based products that are based on your expertise.

Sure, you can build a successful Web site without them, but you’re leaving lots of money on the table.

You already know how much time, effort and money it takes to get people to visit your Web site. Then you have to convince them to buy from you. Then you have to persuade them to complete the order. Then you’ll work hard to establish a long-term relationship with them.

Are you going to waste all that effort by just selling them your standard suite of products and services? Even if these are high-margin products, why not invest a bit more time up-front to create even more products for them?

Find more about our on-line course software.

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