December 9, 2002
FORTUNE SMALL BUSINESS
By Pamela Margoshes
Lois Melbourne isn't someone accustomed to taking no for an answer. So, when the CEO of TimeVision, Inc. (www.timevision.com), a company that makes organizational charting software in Irving, Texas, was closed out of a heavily-booked PeopleSoft convention in San Francisco in 2000, she spent $9,000 to rent a truck to drive around the convention site with an eye-catching banner promoting her company's use of PeopleSoft software to the 15,000 attendees. Thirty-five people took away free CD demos of her product with them. Those contacts translated to $60,000 in sales for Time Vision, which, with 29 employees, projects $5.1 million sales this year.
Like many CEOs, Melbourne realizes that in the current economy, she can't rely solely on longtime customers to keep her company's revenue growing. Given the seemingly endless news about economic uncertainties -- from the potential of war to flagging customer confidence -- it's essential for small business owners to dig deep for new ideas to increase their sales. "Elite entrepreneurs focus on satisfying current customers while aggressively seeking new markets," notes Larry Cox, director of research at the Kauffman Center for Entrepreneurial Leadership in Kansas City, Mo. To help you identify new ways to attract new business without neglecting longstanding clients, we spoke with successful CEOs around the country to learn their best strategies for shoring up their sales.
Break your industry's "rules." When customers call the support desk at Mindbridge Software (www.mindbridge.com), the Philadelphia-based intranet-design company, they connect with well-educated, well-paid support staff. For the past year and a half, Mindbridge has required those who provide telephone advice to its customers to have, at minimum, a bachelor's degree. "Traditionally at many high tech companies," says Mindbridge COO Scott Testa, "customer support has been the lowest end of the food chain, usually the least well educated." Mindbridge's more demanding standards have won many fans among its clients, which include the American Bar Association. Since Mindbridge added this requirement, customers have renewed 98% of their support agreements. These contracts make up 15-20% of the six-year-old company's revenues, which are expected to be $6 million this year.
"Small businesses often have an edge on larger companies in shaping a customer's experience," says Joe Wheeler, co-author (with Shaun Smith) of Managing the Customer Experience (Prentice Hall, $24). "They can very quickly get their arms around their employee base, make changes, then execute fast on them." Wheeler and Smith are senior executives with The Forum Corp., (www.forum.com), Boston, which specializes in corporate leadership training and workplace learning.
Involve customers in your decisions. As the vice president of Sales Concepts, Inc. (www.salesconceptsinc.com), a sales and training firm in Cleveland, Keith W. Strauss knew that his company could earn more money by getting honest feedback from its customers--and acting on that input. So, in the spring of 2002, he enlisted Cleveland-based growth consultant, Andrew Birol (birolgrowthconsulting.com) to organize the first of many customer advisory councils at SCI. The purpose was to get instantaneous feedback from key clients, a comprehensive understanding of customers' needs, new revenue-generating ideas, and ideally, referrals to new business.
Birol's first step was to interview a number of major customers, reporting back to Strauss on their key concerns. Their major sources of dissatisfaction ranged from the desire for more one-on-one individualized contact from trainers at SCI to the paucity of "real world" examples given during some of the training sessions. Ten customers then met with Strauss to discuss their complaints in more depth; Strauss, in turn, detailed exactly how he'd remedy each one. "What we are hearing back after just six months of this," Strauss says, "is that customers say they're getting what they've never had before: their complaints resolved, and they also have a roundtable of CEOs to bounce ideas off of. We're all in growth mode together." Strauss's willingness to listen to clients' gripes paid off. The 15-year-old company expects to increase sales from its 1,200 clients by 30% this year.
Bond with the big boys. "Get over who your competition is!" says Jill Lublin, author (along with Rick Frishman and Jay Conrad Levinson) of Guerrilla Publicity: Hundreds of Surefire Tactics to Get Maximum Sales for Minimum Dollars (Adams Media, $12.95). "Forming alliances with them lets them be your marketing foot soldiers, drumming up business for you." Case in point: Jay Bower, president of Crossbow Group, LLC., an integrated marketing services firm in Westport, Conn. In Sept. 2000, he tried to win Upromise (www.upromise.com) as a client. But executives at Upromise, a 529-college savings plan company, said they really wanted a big agency. So Bower called the general manager of Brann Worldwide, Chicago, a competing direct marketing agency that is part of the global communications giant Havas, Levallois-Perret in Cedex, France. "Brann then went ahead and made its own pitch to Upromise," says Bower. In return for the heads-up to Brann, Crossbow snagged some spillover work from smaller clients of Brann and also work from a Brann biggie: FleetBank (www.fleetbank.com), Boston. "It worked out really well. Working for Fleet, a big financial services company, provided a bridge for us to other companies like CitiBank."
Tear down invisible barriers. As owner and president of Cumberland Gallery in Nashville, Carol Stein was concerned that potential customers were so intimidated by the very mystique of a fine arts gallery that they weren't even coming inside. So, in 1997, she introduced the "Cumberland Gallery Dog," Sasha, whose "job" is greeting customers. "It's hard to feel intimidated when you're met at the door by a friendly, shaggy 70-pound dog," she says. Stein noticed a significant increase in foot traffic--and sales--since Sasha joined the gallery. She's also gotten considerable word-of-mouth publicity; Sasha is now a minor celebrity in Nashville.
Pitch "mini" projects. Most big companies won't commit to a large contract with a small business they don't know. So how does a relatively unknown entrepreneur get in the door? What's worked for Ed Simcox, president of Saurian Technology (www.sauriantech.com) in Indianapolis, is to pitch short-term projects that cost companies $20-30,000, as opposed to the hundreds of thousands typical in the industry. That's how he won a deal he recently completed with Komatsu America, a heavy machinery manufacturer in Chicago. "Pricing is less of an issue when you make it easier for tech directors to get clearance for smaller amounts at a time," he says. "They feel less heavily invested."
A final piece of advice: Part of the thrill of running an entrepreneurial company is continuing to generate new ideas to maximize the profit-making potential of your venture. Although it's fun to test your creativity, don't disdain simpler ideas, like simplifying your order form or increasing the cleanliness of your offices, which can be just as beneficial. "Just doing the basics well elevates you beyond your competitors," says Minneapolis customer service consultant and researcher, Ron Zemke, (www.socksoff.com), author of Delivering Knock Your Socks Off Service (AMACOM, $18.95). When Zemke and the Arlington, Va.-based customer research and survey company TARP surveyed 2,000 consumers on what delights them most when making their purchases, "consistency" was the number one response. In an uncertain world, delivering what you promise time and time again can go a long way.