The New Cottage Industries

I just finished writing my book on e-commerce called, Online Solutions…the Essentials (it’s published by Wiley and will hit the stands in October). This turned out to be one of the most challenging and interesting projects I have ever tackled. The reason for that was because I kept on getting lost in the research which kept opening my eyes to a new and changing world in so many ways.

As much as anyone knows about e-commerce, there is always something new, something different, or just a different approach to doing business. I want share two of those discoveries from the book for you to think about.

“I can’t stop the money from coming in even if I wanted to.”

When was the last time you ever heard that statement? I keep asking myself if I ever had and I’m not sure. But when you think about what that means you start to think that it must just be an exaggeration or some off-the-cuff bragging. Then you realize there are really online businesses that actually mean it. It is the fascinating world of the associate or affiliate program. The best part is everybody can do it.

Here is how it works. It is simply getting paid a commission for the referral or link to another site. You only get paid when that person makes a purchase but you will continue to make a commission as long as that person buys from that supplier. Hence you really can’t stop the money from coming in even if you wanted to.

Don’t worry. You don’t have to start calling all your friends to pressure them to buy from the source. You just have to do place a link on your site that goes to their site. Make sure you would normally recommend the resource without a commission to the readers of your site. They will know the difference.

Associate programs are becoming so lucrative that there are now thousands of sites that have just become referral sites. These sites are just a collection of links, nothing else. Many of them are extremely profitable--after all what are their expenses? They don’t buy or sell anything; they just maintain a website although they must be able to attract traffic to the site. The money never stops.

Even Amazon has a referral program. Just pick the books you would recommend and Amazon will help you set up the link to your site. Then anytime one of the people who come through your site buy, you get paid. I can’t think of a business that couldn’t recommend a book to their customers. Now you can actually get paid for that recommendation. Actually, it also might motivate you to do it.

Under any situation never recommend something you don’t believe in. It will only come back to hurt you later. I never used to recommend this tactic but the numbers don’t lie and this is becoming a new industry created online.

Another new business is similar to the affiliate program but with a twist. That is a referral service. This is where a site charges a fee to be part of the service. If you do a search for just about any profession today, you will generally go through page after page of these referral sites. Every industry has them-- from plumbers, electricians, contractors, builders, as well as graphic designers, consultants, dentists, lawyers, and speakers. All have these sites that will promise their prospects work in return for their fee. Some will also want a piece of the payment but that depends on the company. I have used some of these services both as a buyer and as a seller. The company I used for freelance graphics people and researchers is www.elance.com and I was thrilled with the service. Great people and a job done right at a very affordable price.

I have not been as successful with the referral services I have paid to be in, simply because they were all new services that had no track record. Here is the message to be learned about these referral services. First, understand that they are only selling a listing on a website and a promise of business because of their positioning in the search engines. They generally will pay their salespeople very lucrative first time commissions. Therefore, you can get pressure from some real sharpies. Find out how long they have been in business, interview users of the service, and find out how long they have stayed with the service. If it’s new it generally won’t work for awhile. Don’t be the pioneer-- it rarely pays. Wait a little bit until they get established which might even be a few years. That is my word of caution; be careful and look for guarantees. Check out their rank in Google and if they aren’t in the top 20 -- RUN. I’m sure there are some exceptions but why even bother?

The bottom line is lots of buyers and sellers are paying lots of money to create a new industry. Just make sure they are not just successful because they sold a lot of unhappy customers. Let the buyer beware (and warned).

“It’s The Stupid Stuff”… But Not To Them

This week I had two interesting conversations that might on the surface seem unrelated but they both address one of the most important issues of growth, management, and relationship building every business must face.

Let’s just establish two simple truisms: A business can NOT succeed or grow without good people. I don’t care what kind of business you are in—if you don’t have the right people it just doesn’t go anywhere. Even the best of ideas rarely work without the right people to execute the ideas. Therefore, attracting and keeping the best employees is critical.

Next simple truism: Everyone is different. Yeah So, everybody knows that, what’s my point? If everybody is different, then that must mean that different things are more important to some people than other things. That is more than just a clever use of words--it is the basis of a formula of determining the four basic personality types, which most of us have been exposed to at some point in our lives. It is just a way of explaining the way we judge things, what we determine to be important and not as important, or just what motivates us the most. Let just share a quick review before I proceed.

The Director- They want to control everything. They want to be the boss, they want to be the dictator in extreme situations and they rarely listen to others’ opinions.

The Analytical Type- These are the folks who believe numbers, facts, and figures are the most important thing in life. These are all of the accountants and engineers.

The Socializers- They place personal relationships and interpersonal communication as number one. These folks want to be a friend before you do business with them.

The Relaters- They are sometimes they are also referred to as the Belongers because they want everyone to get along. They want harmony especially with the group of people that they associated with.

With that build up let me share two stories and you see if you can uncover the problems.

1. A store owner is having an internal problem with employees of just not getting along over the typical “that’s not my job”, “she got more hours”, and “she doesn’t work as hard as we do.” All of this is causing an uncomfortable feeling in the store and effecting sales. The owner who has a background as an accountant (that was a big hint) made the statement which I modified for the name of this article. “They are making an issue of the stupid stuff!” Expecting me to agree with her, she was really surprised when I told her, “NO that stupid stuff is only stupid to you because you are looking at the world through the eyes of an analytical person where there is a bigger issue-- the financial well being of the business”.

Yes, that is very important if you are that analytical type. But to the Socializer who could care less about the bottom line well being and does things for social reasons, that stupid stuff is important to them. Those issues must be addressed with empathy otherwise the business won’t move forward. You might not like it and you might not understand it, but you better learn to deal with it.

2.The second incident is a about a social situation that looks at a similar situation from a different point of view. This happened to one of my oldest friends who has belonged to a social group for years where various members will often travel together. When I called to say hello, she was all upset because two of her closest friends went on a trip and didn’t ask her to go.

I heard the expected “how could they do that to me?” and then “they tried to hide it from me.” Obviously my friend is the classic Socializer type where the most important thing in her life are her personal relationships with people (that’s probably why we have maintained a friendship for 40 years). The other two people would be described by her as “a manipulating controlling type” (sounds like a Director Type where I come from) and the other was described as “she never wants to cause a stir so she just gets goes along with everybody”. There is your Relater Type.

The Director took control of the planning and didn’t include my friend because she knew she was busy and they both decided not to say anything because they knew how she would react. They were right. Who is wrong here? No one! It is just the way each of the personalities has been hard wired.

The moral of both stories. Understand what values are important to the person you are dealing with even if you don’t agree. It might seem stupid to you BUT not to the other person. It’s just the way we are all hard wired. We are never going to change the way that someone else thinks. But in order for us to create work environments that work, we need to understand how our employees (and people) think and look at the world around them. We know that our way is they right way…but so do they.

What is Your Entrepreneurial Intelligence?

Did you ever have a EUREKA Moment? That is the moment when you really get it. It’s when everything becomes clear in your mind and you understand for the first time like you never understood it before.

That happened to me today in a way I never expected. I was having a wonderful and interesting conversation with my one of my daughters. She is a very bright and capable pharmaceutical sales rep for a major international drug producer. She understands business both big and small and she mentioned how shocked she was when some of the doctors she calls on don’t run very efficient practices and are either not reaching their financial potential or losing money needlessly.

Why does that happen she asked? These people are very bright and should know better. Then it hit us that just because someone is bright doesn’t mean they have the thought process, the priorities, or focus that someone with Entrepreneurial Intelligence has. Actually, we had never heard of the term before but later we did Google it and it has been played with but never formalized with a book or website.

We got involved in a lively discussion about why some people succeed while others don’t. The question was why don’t really bright people always succeed in business over others of less intelligence?

We agreed that we have always been very envious of really bright people-- how they can understand complex concepts must faster than we can. But many of these people are rarely the biggest financial winners in business. What is it that they are lacking? What is even more important than that is why people of very average intelligence can succeed where others with high intelligence don’t? What do they have, what quality do the average intelligence people possess that make them winners in business?

Please understand we are only talking about financial success in this piece-- we can talk about other types of success at another time.

So as we drove the car on a 3 hour road trip we came up with this list of qualities of the entrepreneurial intelligent:

1. They are opportunistic in nature. They look at problems to solve as business opportunities. I think President Kennedy said it best when he said, “Some men look at things and say, why? While others look at things and say why not?”

2. They are passionate about the project. They create an emotional attachment to any project they are involved.

3. They are risk takers and are not satisfied with the status quo.

4. They are not afraid of failure because they fail many more times then they win.

5. They stick to it. They go beyond logical involvement.

6. They generally will take on more projects than they should because of the thrill of the idea.

7. They are rarely detail oriented. They look at the big picture. They focus on what can be done as opposed to how it can be done.

8. They leverage their strengths. They will surround themselves with bright people that have the capabilities they need. They will leverage their personalities to attract these people and then honor and respect them to create the perfectly balanced team.

9. They know the financial benchmarks it takes to make money and if they aren’t met they move on to the next challenge.

10. Most true entrepreneurs will have a love affair for the start-up. They will lose interest in a project. That is the reason that many of these folks that possess Entrepreneurial Intelligence fail. They need to start it and get out. They are not strong at follow through and the day to day running of a business is considered boring.

Most of the people I work with possess Entrepreneurial Intelligence. They paint the world in broader strokes and leave the details to someone else. They love the thrill of the idea or concept over the everyday plans.

I believe the difference from a successful entrepreneur who is respected and admired in their community and someone who goes from some “get rich scheme” to another and is referred to as a “fruitcake” or “loser” is simply one thing-- success. Sometimes they see things before the market does and it fails, or sometimes because of their list of losing attempts, they are never able to gather the resources together to succeed. Sometimes they give up just before the try that would have put them over the top.

Let me end this piece with this thought. No entrepreneur ever succeeded without someone telling them “that won’t work”. Next time that happens, thank them because they might have just given you the best motivation to make it work. Entrepreneurial Intelligence ROCKS! I wouldn’t leave home without it.

Lessons from the Academy Awards

I just finished watching the 78th edition of the Academy Awards program. This is the annual extravaganza of glitz, glamour, and self importance. Somehow I got into the proceedings mainly because I had been looking at a blank screen on my computer for a couple of hours, playing with a few different topics that I had been planning to write about. However, none of them seemed that compelling. Then I started writing down my thoughts as I watched the show.

As many of you are aware, I am a strong believer in contest marketing. I believe that every business person should embrace the concept of awards. As I say in my seminars, “either receive them or create them”. Seek out every possible type of award that your business qualifies for. Almost every association or magazine offers some type of award program, but also don’t be afraid to create an award or program of awards. I consider starting the Retailers Association of Massachusetts Awards of Excellence program almost 10 years ago (honoring 56 retailers during that time period) to be one of my greatest achievements in life. This past week I worked for Dance Retailer News that runs the Dance Retailer Expo and they were inspired by my initiatives in Massachusetts and created a program of their own. That’s the real joy in life when that happens. Giving the award was as important as receiving. Look for awards you can create and give--from the best store window in town, to Mother of the year for Mothers Day, or simply ‘The Customer of the Year.”

BUT that’s not only what this article is all about. Let me share some of my observations and the Lessons from the Oscars.

1. We love competitions. Most of the people watching the awards program never saw any of the movies that won or were nominated. We just love the event and the “thrill of victory and the agony of defeat”. The Oscars are a human competition that we love to watch. Your customers love to watch you compete as well.

2. Sales sky rocket once you win. Why?There are two parts to this one:a.) Our curiosity wants us to know what’s going. b.) We love to do business with winners.

3. Inspiration: Every winner thanked a person who inspired them. Usually it’s family but sometimes it’s a friend, mentor, or teacher. Who is it for you?

4. We love to root for the underdog, the Cinderella story where the arrogant and powerful are knocked down. That’s why new businesses can succeed and beat the biggest of competition. The winners were not all the most popular films but they were the best. I think this year’s nominees were a sounding bell for all of us that work hard to do the right thing and don’t always get noticed.

5. The Story: Stories sell. They sell merchandise-- they create an emotional attachment to a person, product or business. Share those stories with your customers from the history of the business, to the story or background of your employees, to the story of your product, why you bought it, who designed or made it, to the person who sold it to you. Each award winning movie had a great story but the people involved also had some very interesting stories as well. (I liked the person who dedicated the award to his mother for raising 4 kids alone. He touched me.) How are you touching your customers?

6. Social Significance aka Community Service: We love people who get involved to make this world a better place. Why? Because most of us don’t always have the time to get involved but respect the people that do. Yes, it is the right thing to do but it’s also good business. Reese Witherspoon quoted June Carter with a line I won’t forget, “I’m just trying to matter.” We like people who try to matter.

7. Heroes: We love our heroes and are constantly looking for them. We look for heroes in fictional characters, those that play them and the real people that make a difference. Who are your heroes and who are you a hero to? That could take a while to answer.

8. Risks: Almost all of the winners took a risk to peruse a career as risky as the entertainment business. But in order to succeed we must take those risks, believe in ourselves, and if we get knocked down, just get right back up.

9. Passion for what they do: The winners all had that passion for what they did and worked tirelessly to succeed. If you are not passionate for what you do, get out. Do something else. You won’t succeed without it.

10. Humor: I have advocated humor for years but the Academy Awards program illustrated the importance and use of humor. It broke the tension. It created seamless segues to another topic. It allowed some very strong social statements to be discussed that might not have been mentioned. It was a requirement in order keep the audience’s attention. Those same rules apply in your business. To quote a song from an award winning movie Mary Poppins--it’s the spoonful of sugar that makes the medicine go down.

For those who read this and look at it as just an emotional or inspiration piece, you are missing the point. This is good business because these 10 concepts apply to almost every business plan and should be incorporated in every marketing initiative. One last lesson from the Academy Awards, there will be some people who are very jealous of the winners. The real winners won’t focus on them but will go out and focus on being the best they can be.

I hope you enjoy this interpretation and like June and Reese, I’m just trying to matter.