Friday, July 28, 2017

Are You Sending Mixed Signals?

It is surprising how many businesses send mixed signals to their markets.  That is, their messages talk to different segments in different (and usually contradictory ways) or they speak to one segment with more than one message.

One example is a pizza shop in my city.  They conspicuously brand themselves as a pizza shop (it is in their name) but they message as a traditional Italian restaurant.  And they proclaim that they are a trendy night spot/bar but also a family-friendly dining spot.  The result is confusion.  And traffic is not there.

Another example is an entrepreneur who sells two entirely different products at the same time, advertising both financial planning services and a healthy living supplement.  Because advertising time and space is limited, only half a message gets out at best for each line.  The result is confusion.

Less glaring examples exist.  Consider an advertisement that emphasizes low cost (something that appeals to a classic budget-conscious shopper) but also style/fashion/trendiness (something that appeals to a vanity shopper).  They are in fact trying to sell to two different markets in the same space.  And the result is confusion.

Bottom Line:  How do you speak to your market?  do you inadvertently send mixed messages to your market place?  Are you trying to do too much with one advertisement or promotion?  Can you simplify and speak to one target at a time and avoid trying to target too many different segments?

Tuesday, July 25, 2017

Why Market Research?

If there's one thing I have learned as an entrepreneur it is that most small businesses simply don't do any market research.  To the extent that budgets are restrictive I can understand this reluctance.  But there are so many good reasons to undertake some market research.  Consider:

1.  Market research means a better understanding of customers and prospects.  People come to us to satisfy needs.  We need to have a good handle of what those needs might be.  And without market research we won't know about trends among our customers until it is too late.

2. Market research means a better understanding of competitors.  It is difficult to differentiate ourselves from alternatives if we don't know what those competitors are doing.  And without market research we will have a much harder time staying ahead of the competition.

3. Market research means a better understanding of our own products and services.  We are sometimes too close to our own work to be able to spot imperfections.

Overall, market research helps us make better decisions because we have a better handle on our customers, prospects, products, services and competitors.

Bottom line:  Moving along without market research is a risk.  It means doing business on a hunch, assumption and pure faith.  It means giving an advantage to a competitor who might be using this tool to better understand their market and better serving your prospects and customers.  There are low cost ways to find better information.  Don't let this opportunity pass you by!

Tuesday, July 18, 2017

Good Brands Can Be Undermined

I'm not sure if it's a trend yet, but I haven noted the passing of a good many franchise businesses, predominantly restaurants, in recent years in my thriving and affluent metropolitan area.  I think they are examples for a teachable moment in brand erosion.

To be sure, restaurants live on the edge and can close in a heartbeat.  And to be sure, I've seen them come and go in my twenty-six years of residence here. It surprises me when a franchise goes belly-up in an up market.  These businesses typically bring to bear substantial name recognition and ready knowledge of their offerings.

Are there food habits changing?  I don't think that's the cause.  Similar genre restaurants do quite well (some of the victims are fast food chicken, pizza, and buffets).  People aren't necessarily eating healthier nor more cheaply, either.  The economy isn't so iffy that overall dollars are drying up.

What I have seen at a few of these places is execrable customer service.  And there is nothing so good at killing a business---even one with a major brand name.  One local franchise holder was so bad at hiring and training good employees that at least three of their restaurant stores went down.  In the next door metro, that franchise is thriving.

BOTTOM LINE:  No matter how strong your brand might get to be, it can be wrecked by poor customer service.  And where competition is strong, that effect could be even more intense.  Make sure yours is top-notch!  Remember that even a powerful franchise name can't overcome that!

Tuesday, July 11, 2017

Market Research Can Save a Business

It's generally understood that good market research can help a business by identifying weak products and services, finding new prospects, and zeroing in on effective messaging.  Sometimes, market research can save an entire business.

A case in point is a little online dating service called In Tune Hookup in the early 2000s.  Its developers had difficulty making the video aspect work and didn't get any traction.  A serious market research application suggested a realignment of the core business from the dating service (where there were a huge number of nearly identical competitors) to a wiki- format video sharing service.  The result was Youtube, sold in only a few years later to Google for $1.65 billion.

Admittedly that is an extreme example (not to mention that there is disagreement about the origins of Youtube) but it isn't hard to find other cases where a business realigned to a profitable form after an outside perspective was applied.  It can be difficult for a business owner to see as clearly from the inside when the enterprise encounters difficulty.

Bottom Line: Don't hesitate if the bottom line isn't where it should be.  Find a market research professional or at least a business coach who can help spotlight trouble spots and if necessary recommend a realignment that could lead to wild success!