Small business owners are sticking to the “tried and true” marketing strategies in this tough economic year.  An October 2008 Small Business Marketing Outlook report by Adology shows that small businesses continue to be optimistic about marketing, but that they are not venturing out into new marketing efforts.

According to the Adology survey, small businesses say they will spend money for online advertising (69%), Yellow Pages (54%), newspapers (51%), and direct mail (51%).  This is pretty typical, standard marketing; nothing new and exciting here.  Even online marketing has been around for almost 15 years.

Top of the list. Most small businesses (74%) believe their company “must be one of the first 2-3 that come to a customer’s mind” when they need what the small business owner is selling. This idea is borne out by the fight to be at the top of a Google search for that type of business in that area.

But the survey found that small businesses are not venturing out to try newer forms of marketing: 77% do not use online video, 83% do not podcast, and 82% do not use mobile advertising.

Mobile advertising? Mobile advertising  is advertising on mobile phones, PDAs and wireless devices.  Since the mobile phone/PDA industry has grown exponentially, it has seemed inevitable that mobile advertising would grow at the same rate, and the predictions in late 2007 were optimistic.  An article in Wireless Week said:

Mobile advertising seems to be an industry that’s about ready to explode, chasing the billions already being spent on Internet advertising.

And Yahoo says mobile advertising is primed to total $19 billion by 2012.  But  small businesses seem to have backed off this form of advertising in favor of more traditional forms.  It’s my guess that small businesses don’t have the dollars to spend and their markets are more local and specific.  It doesn’t make much sense for a small business to advertise on a mobile network when their customers are primarily in Des Moines.

If you have experience with newer forms of advertising and marketing, let me know.

Image: sxc.hu

People love free things, and there are catalogs full of great stuff you can give them.  Give-aways are another way you can promote your small business, as I was discussing yesterday.  Looking over the huge number of possibilities (so many, they fill catalogs), you may wonder which are the best.  These 5 are, I believe, the ones that can give you the most for your money:

Why Give Stuff Away? Three reasons why you should be giving stuff away to people: (1) People respond to gifts by feeling a sense of obligation.  It’s the principle of Reciprocity I talked about several months ago.  If you give them something, they will feel they should do something for you. (2) People can put the gift somewhere to remember your business. (3) They can share the gift with friends as they refer your business to them.

Business cards. This one is pretty obvious.  Every business needs business cards.  The main thing to remember about business cards: They only work if you use them.  You have to give out hundreds of cards to get one person to use it and call you.

Flyers/Brochures. A brochure or flyer can help promote your business if you can get them in the hands of people who will call you.  Flyers are for posting on bulletin boards around town; brochures are for handing out at those events where you will be working.  In both cases, don’t be stingy and order just a few.  Order lots and make sure people take them.  Better yet, get a brochure or flyer in the packet or “goodie bag” that gets handed to everyone at the convention, health fair, or other event.

Something related to  your business. Chiropractors give out bend pens; dentists give out toothbrushes. Health food companies give out water bottles at races.  My hairdresser gives out candy wrapped in paper with her business information on it.  If you can give people something that is cute and funny and reminds them of your business, they will remember you.

Refrigerator Magnets.  I’m a huge fan of refrigerator magnets, especially the ones that look like business cards.  What better place than the refrigerator to put your information so people will see it?  I have magnets on my refrigerator for my veterinarian, appliance repair place, my hairdresser, and my favorite bed and breakfast.

T-shirts. These are a little pricier, but they are fantastic give-aways because people love to wear t-shirts and they will wear them forever.  I worked for a company several years ago that gave away t-shirts at a race, and I still see those t-shirts around town.  Kids particularly love t-shirts, and they get handed down and sold at garage sales, so your good name gets spread everywhere, for many years.

One final thought about give-aways.  Be sure the give-aways are:

(1) Perfect.  Every piece of information should be proofread and double-checked.  A wrong phone number on your business card isn’t going to get you any new customers.

(2) High qualify.  A give-away that doesn’t work, falls apart, or breaks, is not going to help you.

Give-aways are an important part of your business promotion effort, so find a couple that work for you, spend the money and get lots of them.  You will be glad you did.

“Are you still in business?” A small business owner told me she was talking with a friend, who asked, “Are you still in business?”  If her friends didn’t know she was still in business, she was obviously doing something wrong.

You have a great business, I know.  And you are working hard to do everything you need to do, including marketing, customer service, and managing your finances.  Just don’t forget to promote your business.  What I’m talking about when I say “promotion” are those things you do to keep your small business in the “eye” of the community, to keep people aware that you are still out there, especially if you are selling to the community.

Ways to Promote Your Business. I suggested some ways the small business owner could make sure people were aware of her business:

Get involved in a community event. Every season has some events in the community that you could join.  I am sure you can find some that relate to your business products or services.  If you have a fitness-related business, sponsor a race.  If you are a restaurant, participate in a cook-off or food fest. Set up a booth at the county fair or at a mall event.

Volunteer. There are many ways businesses can help out in any community.  Just being out there and helping, especially if you bring employees along, keeps your name in the public eye and generates lots of good feeling.  Ask for employees to help you volunteer on a Habitat for Humanity house or a Red Cross blood drive, for example.

Create a community event and publicize it. Create your own event, maybe centered around a special day for your type of business, and publicize it.  Get one of the radio stations to do a promotion for the event and invite the community to help you celebrate.

Talk to community groups. I am a big advocate of public speaking to promote your business.  Find community groups that need speakers (they all do!) and get out and talk to them.

Promote on Your Website. Keep your website up to date and use it to promote community events, your own events, your speaking engagements, and anything you can think of that will draw people in.  Have a “What’s Happening In [name of community]” page on the site, and promote the activities you are participating in and those you want people to know about.

Keeping your name out in the community doesn’t take a lot of time and money, but it’s something you should continue to do to let people know you are “still in business.”

Image - mobikefed@flickr

Every day people go into small businesses with the hope of making enough money to enjoy life, save for retirement, and gain financial security.  But one big barrier stops them from making enough money to achieve their goals - it’s called “payroll taxes.” otherwise known as Social Security and Medicare.

Joshua Kennon, who writes the Investing for Beginners GuideSite for About.com, says,

The single biggest threat for those who want to move from the lower or middle class to the “capitalist” class, as some academics have called it, is the payroll tax….[which] effectively serves as a barrier that makes it nearly impossible for the average American to accumulate wealth, especially if he or she is self-employed and forced to pay the entire 15.3% themselves.

A friend told me a story that illustrates this problem. She started her small catering business a couple of years ago and until this year she never had a profit.  This year, her CPA tells her, she will have a profit.  But she won’t see much of that money, because she will have to turn around and give it back in both income taxes and payroll taxes on the profits.  By “payroll taxes” I mean Social Security and Medicare, which business owners must pay at the rate of 15.3 percent on the profits of their businesses.  So if my friend has a $10,000 profit, she must pay income tax on that profit, plus $1530 in payroll tax.

You might say that’s good, because she is building up credits toward her retirement.  Sure, but if she had a capital gain of $10,000, she would not have had to pay the $1530 payroll tax on it.  (The short-term capital gains tax rate is the ordinary income tax rate; the long term capital gains tax rate is currently 15%.) If she had a profit of $10,000 on rental income, she would not have to pay payroll tax on it.  If she earned $10,000 as an employee, she only has to pay half (her employer must pay the other half.)

So how does a small business owner get ahead?  The only way to avoid payroll taxes is not to make a profit, or to shelter some of that profit in qualified benefit plans, like SEP IRA, 401k, or other plans. If your small business is going to make a profit this year for the first time, run, don’t walk, to a reputable financial planner and start talking to this person about what you can do to legitimately and legally get into a qualified plan.

Image: sxc.hu

You have probably heard the saying, “Build a better mousetrap and the world will beat a path to your door.”  I have always disliked this saying, because it’s not true.

Many small business people think they can create a great product, get funding, and start producing that product, and everyone in the world will flock to their business to get that product.  It’s not going to happen.  The “better mousetrap myth” ignores one concept: you have to tall people about your mousetrap so they know where to find you.  Even more, you have to convince them they want that mousetrap, need that mousetrap, and can’t live without it.

Napoleon Hill, author of the classic motivational work Think and Grow Rich, said:

In the end, the customer doesn’t know, or care, if you are small or large as an organization.  She or he only focuses on the garment hanging on the rail in the store.

And Peter Drucker, probably the greatest management guru, said,

“Quality in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for. A product is not quality because it is hard to make and costs a lot of money, as manufacturers typically believe. This is incompetence. Customers pay only for what is of use to them and gives them value. Nothing else constitutes quality.”

if you want your small business to succeed, it’s not enough to build a better mousetrap.  Think first about what problem your customer has and how your mousetrap can solve it. That’s value.  That’s what will make your business successful.

Image: sxc.hu

What Calvin Coolidge Really Said:

Calvin Coolidge, the only U.S. president born on July 4, is famously quoted as saying, “The business of America is business.  Here is what President Coolidge really said, in a speech called “The Press Under a Free Government” in 1925:

“After all, the chief business of the American people is business. Of course the accumulation of wealth cannot be justified as the chief end of existence.“

In the last paragraph of the speech Coolidge said:

We make no concealment of the fact that we want wealth, but there are many other things that we want very much more. We want peace and honor, and that charity which is so strong an element of all civilization. The chief ideal of the American people is idealism. I cannot repeat too often that America is a nation of idealists. That is the only motive to which they ever give any strong and lasting reaction.

In the midst of the toughest time since the Great Depression, a little charity and idealism would be nice this Independence Day. Have an enjoyable Independence Day.

Image: Newscom

Over this weekend, I will be looking at some famous quotes about business success.  Take some time to think about your small business and its success.

It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.    Sun Tzu

I was talking with a friend the other day about how difficult it is to run a small business today.  Small businesses are going bankrupt at a greater rate, they have fewer opportunities to get loans, and yet some survive, even thrive.   People are still starting small businesses, they are finding new ways to make money, and they are still optimistic about the future of small business.  The people who thrive in small businesses today are, as Sun Tzu says, responsive to change.

We live in a time of great change.  The ways we have thought about business success are no longer valid.  Our expectations about the financial system, the money system, and the government are out of date.

If you want your small business to be successful, you must be willing to change your ways of thought.  I am not a fan of the phrase “thinking out of the box,” but maybe that’s what you will need to do to survive.  You can’t count on bank loans, traditional financing, marketing plans, employees, or anyone else.

What will you change to make your small business successful?

Sun Tzu, who may or may not have lived, is said to be the author of a work called The Art of War.  Much has been written about this work, which you can read in full from Project Gutenberg.

Image: sxc.hu

Closed for vacation. Are  you considering taking vacation this year, and closing up shop for a week or more?

My husband and I headed out to our favorite breakfast place last weekend and found it closed for two weeks.  I can certainly see benefits to closing up your business and taking off, from a personal standpoint. After all, everyone needs a break.

I have seen the “closed for vacation” sign mostly on restaurants, but other retail establishments seem to be doing this more and more. The kinds of businesses that take vacations are usually those that have the kind of business in which people will continue to come back and can wait several weeks for service.  I don’t see the local dry cleaner taking vacation, for example, but other service businesses like barbers and beauty salons certainly take time off occasionally.

Some questions about taking time off from your business:

• Do you force employees to take the time off with no pay? Or do you give them paid vacation?  There is no law that says you must pay a vacation (nor sick pay or personal time or holidays, for that matter).  But most employers do give some vacation time to stay competitive.  Paying employees for vacations can add significantly to the cost of that time off.
• How do you notify your customers? Is a sign on the door enough?  If you have a newsletter, you could let them know.  My restaurant had little cards on the tables as well as a sign on the door.  You won’t catch everyone, but you will prevent an irate customer leaving nasty messages on your answering machine.
• Have you considered keeping the place going while you are gone? That decision probably depends on how much you trust your employees, or if you have a manager you trust.
• Do you worry about losing customers? I would.  But I would weigh the cost of my sanity and the benefit to my family with the thought that a few customers might find somewhere else to shop and not come back.

I hope you are taking time off from your small business this summer. You deserve it.

Image: sxc.hu

Summer is a perfect time to get your small retail business out of the house or the store and sell at a flea market or farmer’s market.  Many cities have these events, several times a week and on Saturday mornings. It’s kind of like an old-fashioned eBay, and it’s a great way to let people know about your business.

My town has a large farmer’s market downtown two weekends a month.  I was expecting to see fruits and vegetables and baked goods, so I was surprised to see how many products were being sold there, like:

• Candies and chocolate (notice how this one’s at the top of the list)
• Coffee and Teas
• Meats (particularly free-range)
• Crafts
• Wines from local wineries
• Soaps, skin care products and organic cosmetics
• Antiques and collectibles of every imaginable kind
• Canned foods like jams and jellies, salsa, and relishes
• Jewelry
• Hand-made clothing
• Toys and games
• I even saw a local chiropractor talking to people about his services.

Almost any kind of retail business or small business selling a product could participate in an outdoor market.  The businesses lease the space from the promoter (often a town or city).  Most markets operate rain or shine and you would be surprised how many people come out in the rain.

A Small Business Example: I found a local coffee company at a flea market a couple of years ago.  She gave out free samples and I found out about her fair trade water-processed decaf coffee.  She said she doesn’t have a store - too expensive. So when I needed coffee I called or emailed and she would send it to me (I paid online).  The flea market gave the coffee merchant an low-cost opportunity to introduce her products and get people to try them.

If you are considering a new way to sell your products or promote your services, try selling at an outdoor market.

Images: sxc.hu

Since this is Freedom from Fear of Speaking Week, I thought I would follow up my discussion yesterday of why you need to do public speaking to promote your business, with some tips for Effective Business Speaking.

The TED Conference has some great “commandments” for public speaking:

In addition: Some tips from my experience as a public speaker and teacher of public speaking:

• Find a topic you enjoy talking about. If you don’t enjoy the topic, your lack of excitement will show through.
• Show your expertise. As I mentioned yesterday, don’t directly promote your business, but show your expertise indirectly and people will want to learn more.
• Work on one good speech. Spend time honing the content of that speech, so that you are extremely comfortable with it.  DO NOT MEMORIZE the speech.  Expect to take notes with you and refer to them if necessary.  I have seen too many people attempt to memorize a speech, only to freeze when they get up to deliver it.
• Practice your delivery. HOW you give the speech is much more important than what you say.  About 87% of what your audience is paying attention to is your delivery and the way you smile when you are talking.
• Make it interesting. Add lots of stories.  If you don’t have them, make them up.  People want to hear about other people, not about dry dull statistics.
• Focus on the start and finish. People remember the end of a great speech, followed by a great beginning.  The middle is the place for those stories to keep the folks interested until you can get to the end.
• Finish with a “call to action.” Tell people what you want them to do - Brush every day, learn a language, start a business.  Make your call clear and specific and memorable.
• Use the “tell ‘em” principle.  Tell them what you are going to tell them; tell them; then tell them what you told them.  Every speech must have those three parts.
• Watch the distractions. Pay attention to those things that distract your audience’s attention from what you are saying: non-words (um, ah, yaknow, like…), body language, clothing (nothing too flashy), movement (pacing, jumping from foot to foot).  Anything you do too often will be distracting.
• Keep it short. People want speeches to be (1) interesting and (2) short.  You can give an excellent speech and make your point in 15-20 minutes.  If you go longer than that, people will lose interest.

Finally, and most important of all, PRACTICE, PRACTICE, PRACTICE. Practice helps you get comfortable, eliminates the distractions, and hones your speeches.  You can’t learn public speaking from a book or by watching people speak on YouTube.  If you want to be a good speaker, you must speak.  The more you speak, the more comfortable you will get and the better your speaking ability.

So, get a great speech, practice in front of the dog or your best friend, and get out there and speak!

Image: dullhunk@flickr