Social Networking, Toss the Rules and Get Real

Social Networking, Toss the Rules and Get Real

A number of rule lists, portrayed as inviolable, are circulating for how to properly use social media networks to build business. I have a problem with these “rules” because social media is evolving so fast, the list seems outdated before you have a chance to apply it. In this light, I offer the following observations on social media networking.

1.      Think of your social media network as a business party. Here is a chance to interact with a lot of people in a fairly casual setting, who might be good business contacts in the future. Behave accordingly, this is a getting to know you a little more intimately chance, not a sales seminar or the moment to tell anyone everything about you.

2.      Parties and conventions can lead to lots of new business and ideas, or can be a complete waste of time. Working almost always leads to more work, so work first, party later on a limited basis.

3.      As in any casual business gathering, sales and results usually come slowly over time. And those successes are generally built on somewhat random chance encounters. Increase your odds by selectively limiting your network and interactions to those that are likely to pay-off, but patience and being ready for opportunity count most.

4.      Direct sales pitches are supposedly forbidden on social media. Forget this notion. Regional businesses have used Twitter, Facebook and MySpace with great success for special events and promotions. This is the trick, don’t try to disguise a direct sales appeal as social interaction. Know the difference and be honest and upfront about it. If you can create a killer sales campaign delivered on social networks, go for it, just don’t try to disguise it as chit chat.

5.      Don’t think chit chat is selling or will lead to sales. It might. But unless you are Oprah, nobody cares where you ate lunch.

6.      Control your exposure. When you post yourself on a social media network, you expose yourself to the world. Polish that image, remember this is a big business party, your house slippers and sweats aren’t appropriate, nor are nutty family details.

7.      Don’t combine family and close friends on the same site as business. Even if you have the most absolutely lovely photogenic perfect family. Keep business and family life separate to keep both sides happy.

In summary. The rules for social networking aren’t new. They are the same rules that have governed interpersonal communications for centuries. When presenting yourself as a businessperson, pay at least a little attention to crafting the best image possible. If it is a casual getting to know you kind of site or communication, don’t be a pushy sales person. When you are doing a direct sales appeal, don’t try to pretend that you are just sharing the details of your marvelously cool life. It’s all about honesty, treating others in a fair and considerate manner, and understanding the difference between your personal life, business life, and those areas where the lines begin to blur.

Pinhead Pricing

Blog – Week of May 24, 2009

Pinhead Pricing

Econ 101, you have a supply line and a demand line.

They meet at a point.

This is the blessed state of equilibrium. Voila, the price has been determined and established with absolute academic rigor.

Theoretically of course.

Turns our pricing only works like that on chalkboards, there are a couple of Nobel Prize winning economists wandering around today, hopefully unemployed but I doubt it, who applied their price theories very precisely to everything in the United States. Because of their brilliance at the chalkboard, they convinced a lot of bankers and hedge fund managers to invest according to their theories. A banking crisis was born.

Every real world business owner, or person who has ever run a garage sale, knows the truth. Prices are determined by what the customer can and will pay. Supply and demand matter, but so do a lot of other things, otherwise the Rolex watch would be extinct, just like T Rex.

Prices are sticky. Turns out, people judge the relative worth of items by preconceived idea of cost. Thus there was a time when virtually no one would pay $5 for a cup of coffee in a paper cup. Then came a time, when no one who was anyone would buy a $1.25 cup of coffee in a paper cup, we had to have that $5 cup. Now we make it ourselves for $1.25 a pot.

This has to do with anchors. An anchor is the price at which you last actively considered the price of an item, not just when you saw the price, but thought about it. Take jeans, you need some, there is a pair for $80. In fact you look around at several stores and see lots of jeans for about $80. This becomes your anchor. Now when you come across the same pair for $50, you think it is a pretty good deal.

Note, you do not know the supply curve. You have no way to know that stock is piling up in a warehouse in Taiwan. You don’t know that supply is strong or weak. You don’t know the cost of production or distribution. Econ theory claims all this information is contained in the price, so you are in fact rational to buy the $50 jeans; a little truth there, but it isn’t really how customers operate.

Thus every jewelry salesman knows, first show the customer the most expensive piece of jewelry in the category, or at least one far more expensive than the soon to be newlyweds could ever afford. This sets their anchor high. Later when they pay twice what they expected, it seems to be a terrific bargain. They anchored high, and it shifted their value perception.

I’m not trying to suggest being manipulative. The point here is understanding what drives opinions on pricing. Dan Ariely wrote a thought provoking book, “Predictably Irrational” about how consumers really act in the marketplace. It’s worth reading.

Howard Henson & Associates, Inc.

Marketing - Public Relations - Grapic Design - Web Design - Printing - Laminating

Larry Henson, President In Business Since 1974 405-471-4888

What Makes Customers Tick?

Faced with a long-term client that wasn’t buying our latest ideas, we were a little tired of redoing the same ad for 15 years, a cohort got this bright idea, let’s do some research. Bingo.

A pricey research report was out of the question. But we had a telephone.

With a list of 150 customers, we developed a list of questions and made calls. Our findings weren’t earth shattering, but they were helpful in developing a truly client centered message. The process brought us, the client and the customer closer together. Now we had a page to work on, a target to reach.

Often due to lack of funds and time, those of us in small business neglect market research. Post purchase surveys are fine, but have a low response rate. On-line surveys have a lower response rate. Being pleasant callers, we had an almost 100% response from our randomly selected sample.

The knowledge gained by this do-it-yourself project has convinced me that at least twice a year, every business should conduct a real person telephone survey of customer satisfaction and purchase reasoning. Even a small sample will help to refine your marketing and business models immeasurably. The more senior the callers, the better the information is going to be,; because a partner can ask follow up questions that a lower level employee might not think of. Also, try to find a way to reach a sampling of people who didn’t purchase the product, say those who called for a consult and didn’t convert, because they offer good insights as well.

It’s not expensive market research, but it works.

Want to know what makes your customer tick? Just ask.

Howard Henson & Associates, Inc.

Marketing - Grapic Design - Web Design - Printing - Laminating

Larry Henson, President In Business Since 1974 405-471-4888