Are you spending enough on Positive Costs?

Meet and Greet - Positive Cost?

In my accounting days (yes, I know most of you won’t believe it – I was!!) we had a few different ways of looking at the costs of a business.

The most popular of these was a very simple analysis – Fixed Costs, which were those costs that would not vary with volume and Variable Costs, which were the costs which did vary according to volume. This was quite a simplistic model, which didn’t always hold up!

We then had other methods of looking at costs such as Zero Base Costing and Activity Based Costing .. interesting stuff indeed!

Since the recession has kicked in I have witnessed first hand clients being advised to cut back on expenses by the accounting fraternity and often they just do it themselves automatically – the types of costs that get chopped first are those that are deemed to be “unnecessary”, which will typically include marketing &  advertising spend, sales reps, items like training, corporate entertainment, Christmas gifts, staff entertainment  and other “extras”.

On the surface it is easy to figure out why companies would cut back in such a way but you could ask the question: Why spend this money when sales were easier to come by and when it is harder to win business you just abandon them?

Could reduced sales be a self fulfilling prophecy when you cut out certain overheads?

The New Cost Model

Taking the knowledge of my old profession and combining this with what I am witnessing with clients every day I am now proposing a new way of analysing costs.

Here goes ..

There are actually three types of costs:

Negative Costs –   these are the costs that a business is “stuck” with, regardless of volume. It would include Rent and Rates (but not necessarily 100% of these – I will explain that later), Insurance, ESB, etc.

Maintenance Costs – these are the costs of servicing the business that you have brought in. It would such items as staff costs, raw materials, power and delivery costs.

Positive Costs – these are the costs that are all about bringing new business in, effectively the costs, which should have a “positive effect” on the business.

Positive costs are the most important costs of the whole business, they are the elements that are designed to start the engine, the elements that can make things happen, that “trigger” customers to actually place an order.

Positive costs are far reaching and could include surprise elements that you would not expect: the premium you pay to have a premises in a location that will bring in more customers, the cost of washing the car after it has been serviced, the cost of polishing the shoes that have been repaired, the cost of having a receptionist who answers calls promptly and deals with customer queries swiftly.

There could be an element of positive costs to most people overhead in the business – the porter who does “meet and greet” at the door of the hotel, the credit controller who carefully spends time with customers who are experiencing difficulty, the accountant who spends time with customers to understand the business better, the staff party to reward a hard working team and a deliberate initiative to improve morale.

I’m sure with a little effort you will think of thousands of other unexpected examples – all of these elements contribute to bringing in more business and create a “positive effect” on the business.

Of course Positive Costs will include items such as advertising, marketing, graphic design, web marketing, social media activity and even PR!

Positive costs are absolutely essential for generating business for any company – cutting these out may be viewed as a necessary step but it will eventually choke the oxygen of the business.

Recession (or any time for that matter)

Using our new cost model I would suggest the following approach:

Analyse your costs into the different cost categories and work towards –

1. Reducing the negative costs as much as possible

2. Improving efficiencies and work practices so that maintenance costs are as little as possible

3. Spending as much of your overhead budget as possible on positive costs .

I am not for one minute suggesting naive spending – always look for the best value in your positive costs and don’t waste money, making sure they are actually positive costs – that the spend results in increases in business.

Are you spending enough on Positive Costs in your business?

Greg Canty is a partner of Fuzion

Happy 5th Birthday Twitter – Valuable or Waste of time?

Happy 5th Birthday Twitter !

Happy Birthday Twitter..

On the 21st March 2006 founder Jack Dorsey sent the very first tweet and five years on while it is growing in popularity it is probably still the most misunderstood of the popular social media platforms.

When we run our Social Media courses the results are nearly all the same , pretty much everyone is using Facebook at some level and just a very few are using twitter. I would guess that just 20% of social media users are actively using twitter.

Is this failure, is this most people deciding that it is irrelevant, is this most people not understanding how to use twitter or is it an absolute gem that is yet to be discovered by the mainstream?

At Fuzion we take it really seriously because we see the value of it for us and for our clients but I do understand the difficulty that people have with it. By it’s nature it is looser than the other platforms with pretty much anyone being able to follow anyone, your messages are more public capable of being picked up by anyone searching and then there is the business of hash tags, re-tweeting and #FF, that’s follow Friday, by the way!

Added to that everything is limited, how many characters in your unique identity, how many characters in a post, how much information you can include in your bio – it’s just different, different enough to scare users off initially before they get to experience the real magic.

I won’t start giving a lesson on how to use twitter but I will share with you my Top 10 reasons why we think it should be embraced –

1. Branded Chit Chat – on twitter you can choose an identity for yourself and every time you post, your “identity” carries with you, it’s like advertising in a subliminal way @prguru. Guess what service that person provides? Even if you are chatting about the Liverpool game your identity travels with you.

2. Viral “ability” – of all the social media platforms twitter is the very best for passing on information. The retweet facility makes this possible. I pass the message to my followers, them to theirs and so on. Uninteresting posts will not be retweeted but interesting ones will be, remember Simon Coveney’s, Brian Cowen post? Simon Coveney did not have many followers when he tweeted that information, it didn’t matter.

3. Innovators and Early Adoptors – Seth Godin in his famous book the Purple Cow talks about a typical product cycle and he stresses the importance of targeting people who love new things. These are the people who love to try new things out and then tell their friends, they are generally naturally curious and are often the ones who are vital for spreading the word – before you know it when enough people have heard about “that” new product it enters the mainstream, where volume starts kicking in. If you have a new product or service you will find many of these innovators and early adoptors are already using twitter- makes sense if you think about it?

4. Avoiding the Crowd – Facebook has the advantage of so many users and it is really powerful as a result. However it is a pretty crowded space with more businesses joining it the whole time competing for people’s attention. The chances are that your competitors are already up and running and competing with you in this space. Twitter on the other hand has not been explored to the same degree so you can steal a competitive advantage over your competitors and have more of those prospects to yourself.

5. Search – the search facility on twitter is incredible. You can use it to follow topics, to search on people discussing your business and your industry. We find it invaluable in our work with clients and in a “crisis” situation it is really useful. You can literally measure the temperature of a situation on twitter, which can be really useful if you are dealing with a tricky situation.

6. Read all about it! – the problem is that it is now impossible to “Read all about it” . With so many newspapers, magazines, radio and tv channels how is it possible? With twitter by following the correct media profiles on twitter you can create your own customised news feed. Everything from your favourite team (have I mentioned this is Liverpool!) to breaking news.

7. Journalists – for some reason many journalists have flocked to twitter, which probably tells it’s own story as to how they value it. If you start using it you can quite easily follow journalists who may be interested in your sector and if used correctly you will be able to learn what they are interested in and what they are writing about. Use the platform to try to build a relationship with them and then pitch your stories – make sure you build trust before you start pitching!

8. Audience – if you use twitter proactively we believe you have a good chance of building “followers” or an audience for your message very quickly, even quicker than Facebook. However, it’s up to you how you use these relationships once you gather them.

9. Relationships – we have found that the nature of the conversations is quite different and at times they are more of a “community” type – the conversations can happen between groups of people. As a result you can have quite different relationships with people. Once you are capable of holding your own on an issue or topic you will build a good reputation and also quality relationships with relevant people.

10. Fun – there can be quite a good sense of humour around using Twitter and even though your topics might be heavy you can build good relationships around lighter issues, which can ultimately lead to a listening for your key messages. My key message is don’t take yourself too seriously on twitter, have fun, build trust and build relationships – after that spread your message.

“Twitter is a load of rubbish, the stuff people tweet is totally useless.. who cares what people have for breakfast”

I often hear this type of argument about using twitter so I will leave you with my closing thoughts ..

Twitter is like a radio station, you tune it in by following who you want – find the channels that you like. If someone is annoying you, don’t follow them, block them, change the channel – you are the controller!

So Jack, thank you for Twitter .. I’d miss you if you weren’t there, Happy Birthday!

Greg Canty is a partner of Fuzion Communications

Sniper Marketing

Should your targeting be more specific?

If you throw enough mud at a wall then eventually some will stick! – you have often heard that expression and when it comes to advertising and in particular at a time when most people are carefully watching their budgets. It can cause problems when it comes to justifying spend in this area.

Influenced by this very argument and also because it often makes total sense, where appropriate we encourage most of our clients to allocate some of their advertising budgets to on-line Pay Per Click advertising, or sniper marketing as we like to call it.

With some of the recent and new on-line tools it is now much easier to target your exact target audience for your product or service, just like a “sniper” would. Why advertise to everyone just to get the attention of a narrow more exact target audience?

With a combination of Google Advertising, Facebook Advertising, and even LinkedIn advertising it is possible to target your customers very specifically.

Most of these initiatives operate on a pay-per-click basis so you only pay for results, even though you can also achieve some visibility for free with those who do not click on your adverts. Just to replay that in simple terms – You only pay when someone has clicked on your advert and come to your website or facebook page. You do not pay every time your advert is shown.

To briefly explain how each of the platforms work:

Google Adwords – here you select (or bid on) keywords that when searched by a user will activate your advert. You can limit your adverts to a specific area or location. You can actually go further and specify which page on your website the user will land on when they click on your advert. Let them find exactly what they want as quickly as possible.

Facebook Advertising – This is quite different to how Google works. Here you target demographics – you can specify types of people in different areas and even with declared special interests. With adverts here you have a choice of bringing bring them to your website or your Facebook business page (this can be very effective in building followers on your page).

LinkedIn Advertising – Advertising here operates more like Facebook with the exception that the environment is much more corporate. You can target types of people, making choices about location, company size and even levels of seniority.

With all of the above options you can control your campaigns by setting daily budgets and also by limiting how much each click will cost. Google reporting in particular can provide you with very valuable information about your customers. (they are all relatively easy to set up but I would strongly advise seeking professional help setting up these campaigns as you can easily make expensive mistakes – they never refuse your money!)

To support this activity you might also consider email marketing – use an on-line email newsletter service (there are many good value options such as MailChimp and Constant Contact and for more sophisticated requirements you could try Newsweaver) to your database of contacts, reminding those who you have already developed a connection with of you and your services.

This sniper approach to marketing can work for all types of businesses as diverse as:

The Ballroom Dance teacher who can target engaged women in Cork with his adverts for dance lessons to get them ready for their first dance at their wedding (there are 1,210 of within a 20 km radius of Cork City!) – Facebook is perfect for this.

The Tax Consultant who wants to target senior executives in Ireland for specialist tax advice – this can be done by advertising on LinkedIn.

We find that on-line campaigns can work very effectively as part of an overall campaign for clients to achieve their objectives.

Could this be something that would form part of your Marketing Plan in 2011?

Greg Canty is a partner of Fuzion Communications

Whoah – Major changes on Facebook!

Confused about Facebook changes?

Just when we were getting used to Facebook they go and change it all again!

This round of changes are quite significant and represent a major change in how they are thinking including (I think?) trying to incorporate things that are possible on Twitter (a business following a business) and a facility whereby businesses can align to each other.

I’ll do my best to explain some of the changes .. here goes

Look and Feel

The look and feel of Business Pages has changed on Facebook with some of the buttons/tabs switching position. The profile pic (if you were utilising its full capability) will now be reduced – from 200 pixels wide and 600 long to 180 x 540 – a call to your graphic designer may be required.

Similar to the new personal profile pages the new business page will also display photos of your most recent “experiences” on the top of the page.

You now have the ability (and choice) to display the “admins” for the page (below the profile pic).

Users switching to Pages

This is a major change and one I suspect is being influenced by twitter to an extent. Now a user can “switch” their profile to their page (or page of your choice if you are admin for a few pages) and then behave more like an individual – however in this mode the user does not have the full functionality as if you would with a personal profile but you can now:

• Like other pages (you cannot be friends with individuals)
• Like and Comment on other pages as “the business”

In this way you will start to see a community of businesses “liking” each other – something which you can do easily on twitter in a very uncomplicated way.

The recommended "pages" appears on the right of the page

To enhance this feature Facebook recommends pages for your business page to like (as opposed to friends) based on similar people “likes” and interests on your business page and theirs (you will have to read that sentence a few times to grasp the point I suspect!!).

One of the effects of this is that updates on business pages you choose to like will come into your news feed (using Facebook as a business “page” user), which in a way can bring you specific information about pages only. This feature enables you to engage with the latest and important news from other business Pages you like.

Information about Business “Page” updates

Facebook has introduced a facility whereby you can get alerts for activity on your page. If you have a large volume of activity this will drive you nuts, however it will help to make sure you don’t miss any important activity of your business pages.

Relevancy – The “everyone” filter

The “Everyone” filter on the Wall by selection provides a new way for people to see the most interesting posts first.

Enhanced Moderations

Facebook have provided more facilities for moderating content on your page automatically including posts by users above a certain age and you also have the ability to block posts using certain selected  “keywords”.

More changes

The changes being implemented are still a little “buggy” so expect a few glitches and a few more things to change slightly – no throwing the computer out the window guys … it’s not worth it!!

All in all you can see that Facebook is trying to enhance the “business” aspects of the platform, which provides opportunities for anyone in business who is clever enough to fully utilise them.

Sorry about the heavy post ..

Fuzion provide a full Social Media Consultancy service.

Greg Canty is a partner of Fuzion Communications

The Irish Bank Robber and Facebook

When the renowned Irish American bank robber, Willie Sutton was arrested having been caught after one of his many bank heists he famously gave the following response to journalists who asked him why he kept robbing banks, “Because, that’s where the money was!”

Willie Sutton & Facebook

Willie Sutton, also known as “Slick Willie” and “Willie the Actor” (he was a master of disguises) was born in Brooklyn in 1901 and lived till 1980. He managed to rob 100 banks in his 79 year career, spending much of this in prison after many captures. Toward the end of his life he ended up fronting an advertising campaign for a bank who were introducing card ID’s with the person’s picture on it.

Besides being a notorious bank robber his quote earned him everlasting fame as his surname is now often quoted to refer to any situation where something is clearly “obvious”. In medical circles in particular his name comes up as “Suttons Law” to describe a situation where a diagnosis is exactly that and accountants even use it when talking about Activity Based Costing, “The Willie Sutton Rule”!

In the business of Marketing & PR we often get resistance when we recommend to clients that they should be engaging pro-actively with users on Facebook. We get the arguments about not liking computers, not having enough time, that all users are youngsters and generally not knowing how to use Facebook and not seeing the relevance to them.

Worldwide users have reached 550 Million with the figure in Ireland just over 1.4 million. Of these over 700,000 are over the age of 30. Many of these are your customers!

On average people are using Facebook about 25 minutes per day. Facebook has individual users as well as many businesses who have their own “business pages” and are interacting and influencing Facebook users on a daily basis. Starbucks, the famous American chain of coffee stores have over 12 million people signed up as fans.

The next time we talk about the relevance of Facebook with a client we might just quote the famous bank robber, Willie .. after all it’s very obvious!

Greg Canty is a partner of Fuzion Communications

How to find new customers for your business?

I deliberately changed the heading I originally had for this article as I felt many of you may just switch off and not bother reading any further!

While that may not be a fair thing to do it is actually not too bad as the title I have chosen for the article is actually very accurate. However the title I had originally chosen was “Social Media is a form of free advertising – Use it!”

Already as I had feared many of you could be saying – I can’t even use a computer so I’m not even going to read this!

Please bear with me and read on. It’s easier than you think and this is a unique opportunity for your business. Many people are already using the different forms of Social Media and are successfully spreading the word about their business and winning new customers in the process.

Consider the different Social Media tools as forms of free advertising, free publicity and a free way to spread the word about your store or your brand. How can you ignore it?

You owe it to yourself to at least understand how it all works, how it could work for you and your business and then decide whether it is something you need to learn or something you need someone to do for you. Most importantly understand how some of your competitors are using these tools and the advantages they are gaining in the process.

Facebook for Business

A small piece of information that might help to hold your interest – There are over 1,110,000 registered users of Facebook in Ireland, all over 18. You might assume that most of these are quite young? Nearly 500,000 of these users are 30 and over. My guess is a lot of your customers are busy using Facebook!

Some of you will already have discovered the power of the different social media for your business but for most it is a fabulous awareness opportunity just waiting to be discovered.

Let’s start with the basics – What exactly is Social Media?

They are the tools available on the web for socialising with other people online. There are many such tools and all totally free you will be glad to hear. The most popular and most useful of these are Facebook, LinkedIn and Twitter.

You don’t need to have a website to use any of these tools, just an email address. If you have a website they can be used to bring more traffic to it.

I will try my best to explain each of these in the most simplest of terms:

Facebook (www.facebook.com) is a powerful free resource for communicating with individuals and groups. At the heart of it you sign yourself up as an individual, build up a network of friends sharing messages, pictures and even video. You can also become a fan of business pages, which could include your favourite shops, charities etc. You can also set up a business page for your own business and encourage your customers to sign up as fans – through this you can add news about new products, show visuals of new collections, announce sales and even invite your fans to an event such as a sale.

I strongly recommend Facebook for any business in the hospitality or retail sector. We encourage all of our clients in these sectors to set up their presence on Facebook and to use it proactively. For example Starbucks have over 5.5million fans worldwide on their Facebook page, that’s a lot of coffee drinkers!

Twitter for business

Twitter (www.twitter.com) is a totally different beast. Basically you can set up an account or identity for yourself or your business and you then choose to follow others or let them follow you. You can then publish short messages referred to as ‘tweets’, which can be seen by the people following you and vice versa. For me quite honestly I am not totally sold on Twitter but I do see the sense in deliberately following businesses or journalists that may be of relevance to you and learn what they are writing about.

LinkedIn (www.linkedin.com) is quite different to the others as it is a business to business form of online networking. On LinkedIn you set up your profile and from here you can invite others to connect with you. With LinkedIn you can normally see quite detailed information about where people are working and the position they hold. LinkedIn comes to life through the ‘Groups’ facility. You can join groups on LinkedIn such as your local Chamber, trade Groups or different interest groups. You can also set up a group yourself and invite others to join. For example I set up a group called Spend Ireland, which encourages people to spend their money in Ireland. These groups can be excellent for discussing topics and finding out information. Another feature of LinkedIn is the ability to register personal recommendations for your contacts and vice versa and you can also request introductions through your connections.

You can spend a lot of precious time on each of these so are they worth it?

Must – My own view is that you absolutely must be using Facebook proactively for your business as a store or as a brand. Make sure you complete your profile and regularly keep it fresh with news, updates, offers, visuals and comments. Let your customers know that you have a Facebook page and encourage them to sign up. A vital point to remember is that it is a form of ‘Social Media’ – try not to be too formal, you will only turn people off. Learn as much as you can by joining other peoples pages and watch how they are communicating news and offers. If you feel you do not have the time arrange for someone to do this for you.

LinkedIn for business

Maybe – I would try LinkedIn and Twitter once I was up and running on Facebook.

One final tip for you – If you have a website make it easy for people to share it with their contacts on the different social media by adding an ‘Add This’ sharing button to your website. Check out www.addthis.com to learn how. If you have a website and are also using Facebook, Twitter or LinkedIn direct them to these pages by adding buttons to the site.

I know that all of this can seem complicated and can be a little daunting but I promise you will get there one step at a time at you will win new customers for you business. What are you waiting for?

Greg Canty is a partner in Fuzion Communications, providing Marketing Consultancy, PR and Graphic Design and Web Optimisation services.