When it comes to publicity, I’ve got pretty strong feelings. It’s really helped my apparel company grow by leaps and bounds in the last 18 months. We can attribute tens of thousands of dollars in sales in this year alone directly to media placements. The road to getting here wasn’t easy.

When my partner and I started, we didn’t know much about publicity. We knew we wanted some, but we didn’t know how to go about getting it. We tried hiring a publicity firm. We looked at their resume of happy clients and impressive placements and imagined they could produce these results for us. Several months and thousands of dollars later, they’d come up empty and we got rid of them.

What went wrong with hiring the “experts”?
A lot went wrong with bringing in the publicity experts we hired. To begin with, they weren’t a fit for our brand. Our company is much more MTV and their other clients were much more Lifetime. They’d never worked with a brand like ours and rather than being straight with us and declining our business, they took our money and delivered no results.

The more surprising thing about the experts is that they weren’t actually all that expert. Their approach to pitching our products was to spam every media outlet under the sun with off-topic pitches. For example, they’d create a press release with a tee featuring a cupcake on it and send that to 1,000 media contacts, hoping someone would bite. Never mind that some of those contacts were tech publications who might’ve actually written about our brand if they’d been directed towards our geekier products. Meanwhile, pitching bridal magazines every few weeks was a waste of everyone’s time. They were never going to write about us, their readers weren’t our market.

So much for experts.

Back to the Drawing Board
After we fired our “experts” we decided to go the DIY route with our publicity. If we didn’t succeed, at least we weren’t laying out $1,000/month on the endeavor. We tried to arm ourselves with as much information as possible. We read blogger opinions on being pitched. We read publicist blogs. We really did our homework, and then we started pitching.

As time went on, we got good at pitching — really good. We were regularly landing placements with high profile major media outlets and the cash was rolling in. People were starting to become aware of our brand. Our search engine rankings were climbing. We grew enough that our company went from part-time hobby to my partner’s full time job.

Hitting a Wall
Publicity is like a drug, once you get a taste you realize you can’t do without it and you always need more. The problem is getting more takes time and our business was growing, that meant we couldn’t just spend all day pitching. We had other parts of the business to work on. We needed more hours in the day, we needed help.

For a while, we tried to make things work entirely on our own. We worked 70 hour weeks. We tried various prioritization strategies and time management. No matter what, we felt under the gun. We knew we couldn’t go back to hiring a PR firm. At this point, we were really good at doing our own PR and we were the experts. We needed another “me”.

Hiring the Right Help
My partner and I were obsessed with the idea of “finding another me”. “If only we could clone ourselves” we’d lament. We needed someone who would do exactly what we were doing to get placements. Then we realized, we don’t need an expert, we need a blank slate. A person with PR experience would have her own ideas about how to get us press and we didn’t need that. We knew what was working, we just needed someone to do things our way.

With that revelation in mind, we brought on our publicist. The person we ended up hiring was young, with little in the way of any kind of professional experience. When we picked her we only cared about a few qualities. She needed to be personable and outgoing. She needed spelling and grammar skills that wouldn’t embarrass us. Above all, she needed to be totally willing to do things exactly the way we told her to do them.

For the first few weeks, our new publicist shadowed my partner. She studied him as he called wardrobe departments at TV shows, sent pitch emails to bloggers, sleuthed out editorial contact information in LinkedIn. Then, we slowly had her begin working on her own contacts. She’d write emails to send to media outlets and run them by my partner before hitting send. She’d make calls to contacts, with my partner sitting there to coach her if she got stuck on a question.

By the end of her first month, our new publicist had our products in the hands of Hollywood costume departments we’d had on our to-pitch list since the start of the year. Having her attention dedicated to our PR efforts has allowed her to make consistent major headway and it’s allowed my partner to turn his attention back to other logistical and creative tasks.

A Shift in Hiring Philosophy
Before I had a business (A.K.A. before I knew anything about this stuff), I always imagined you’d grow by hiring the experts. They had the experience and they’d know what to do to make the business grow. I don’t believe this any more. I will hire experts for a few areas of our business like legal, IT and accounting, beyond that we probably won’t hire any more “experts”.

The trouble with “experts” is they know what worked for other clients or other businesses, but you have to be the expert on YOUR business. Growing a business is like raising a child, the same rules don’t work for every kid and the same approach won’t work for every business. Surrounding ourselves with people who “get” our business is our new mantra.

We are expecting to fill a few more positions in the coming months and we won’t be looking for experienced pros. We’ll be looking for enthusiastic, smart people who can follow directions and want to learn. We don’t want or need them to have experience or be experts in sales or events or whatever other position we’ll be filling. We’ll provide the expertise because we’ve done those tasks for our business. All we need them to bring is those extra hours in our day.

Running a business is crazy expensive. The bigger your business gets the more you’re going to spend. At Ex-Boyfriend, we spend tens of thousands of dollars every year on keeping our shop running. We buy manufacturing materials, pay our vendors, buy event supplies, buy marketing materials, pay for services like credit card processing and web hosting, etc. The list of expenses is nearly endless. With so much money flying out the door, it’s important to spend wisely. Here are a few strategies we employ:

1. Buy in serious bulk
When it comes to certain purchases, more is better. If you’re buying custom mailers, promotional materials, manufacturing supplies, etc. most vendors will give you better pricing if your order is larger. For example the vendor who makes our pens with our logo on them charges 46 cents per pen if I buy 100 pens. They only charge 12 cents per pen if I buy 5,000 of them. While buying 5,000 pens costs me more up front, my savings is considerable for buying a bulk quantity.

Cheap tip: If you don’t have the cash to buy in bulk, see if you can split the order with another small business. For example, if someone making 1″ promotional buttons charges 25 cents/pin for 100 pins but 10 cents/pin for 1,000 pins, see if the pin maker can do two different pin designs. Then find a partner to share the order with. That way you can have 500 pins for your business and your partner can have 500 pins for her business, and you both end up paying only 10 cents per pin. Some vendors may be more inclined to do this than others, but it doesn’t hurt to ask.

2. Comparison shop
The internet makes it easier than ever to comparison shop. Whether you need wholesale catalogs, sewing machines, or shipping supplies, you can soften the blow to your budget by finding the best price. Do a Google search for the item you want to buy and see who’s got it for less. Also be sure to check sites like Amazon, since they have such a huge selection of items.

Lastly, if you are ordering supplies online, make sure you include things like coupons and shipping in your cost estimates. Sometimes the price that seems better actually isn’t once you look at those factors.

3. Get rewards
When you’re spending serious bucks on your business, it pays to use a credit card that gives you something back. Consider getting a credit card that gives you rewards like cash back, airline miles, etc. You can use those rewards to get free stuff for your business or even a treat for yourself. To really game this system you need to follow these rules:

1. ALWAYS pay off your balance in full every month. If you’re going to pay interest on purchases you won’t come out ahead with a rewards card. I can appreciate a cash flow problem as much as the next girl, but if you must finance a purchase on a credit card don’t do it with a miles card, they tend to have higher interest rates. Instead use a card that has the lowest interest rate you can find.

2. Use your card constantly. The way to maximize rewards is by using the heck out of that miles card. That means you put every single purchase on there. I don’t care of it’s a brand new Macbook Pro or a cup of coffee, every dollar counts. If you can’t be consistent with the use of your miles card, you won’t reap the full benefits.

3. Don’t overspend. This does back to rule number 1, don’t spend more money than you have. Otherwise you won’t be able to pay your balance every month and you’ll be charged interest. For some people this requires serious discipline. Don’t think of the credit card as extra cash, think of it as tied to the sum of money in your budget/bank account and don’t spend more than you can afford. Again, if you need to make a purchase you don’t have the cash for right now, use the credit card with the lowest interest rate.

One question I often hear from small business owners is “How do I get more [traffic/newsletter subscribers/Facebook Likes/etc.]?” This is a terrible question. You do not just want more. What you actually want is more targeted traffic, more targeted subscribers, more Facebook likes. etc.

Here’s why quality is more important than quantity:

1. More wastes money
In your mindless pursuit of more, you’re probably going to waste money.

When you fixate on “more” you do dumb things:
- You’ll flier every car in a parking lot, even if 99.9999% of them are going to see your fliers as trash (thus you wasted money/time on fliers).

- You’ll pay $100 for 10,000 Facebook fans. Of course, those Facebook fans are going to be junk accounts that will never buy anything.

- You’ll waste your time collecting email subscribers that will never convert, and your inflated email list size will cost more to maintain. (Most email service providers charge you based on how many emails you send. You are better off paying Mail Chimp $10/month for 500 really engaged email subscribers instead of paying $50/month for 5,000 junk subscribers who are never going to buy anything.)

- You’ll waste money on bandwidth fees to your website for junk traffic from Nigeria that will never buy what you’re selling.

Do not waste your time or money simply acquiring more. It’s not more advertising, traffic, subscribers, etc. that will make you money. It’s targeted advertising, traffic, etc. that will make you money. You are better off with 50 new email subscribers who love you than 500 who couldn’t care less.

2. More distorts your metrics
When you assess your marketing activities, you should be taking a macro view of performance. Then you make tweaks to your marketing based on your metrics. If your metrics are distorted by low quality traffic and leads, you’ll make the wrong assumptions. Here are some examples of what I mean by this:

- If you want to determine which email subject line was better, you send out two versions and check to see which version got more opens. If you have a junk list with unengaged subscribers, your open rate is going to be too low to give you a statistically useful result.

- If you want to work on conversion rate optimization (making changes to your site to get a larger percentage of visitors to buy), you’ll want to test different versions of product photos, product pages and checkout pages to see which ones convert more sales. If 99% of your site visitors are bots or humans who aren’t your target market, your conversion rate is going to seem rock bottom. You’ll waste your time chasing your tail on conversion rate optimization when the real problem is traffic quality.

In short, when you want to evaluate the success of your marketing efforts, you need to look at the right metrics. If you are trying to evaluate a marketing effort that assumes you have a qualified audience, you’ll false blame the marketing effort when you should be blaming your lead generation efforts.

3. More doesn’t give you the social proof you think it does
If you think having more fans, more followers, more likes, etc. in the social media universe will make you seem more credible, think again. Whether you’re trying to impress prospective retail customers, competitors or wholesale buyers, chances are this ruse won’t work.

Anyone looking to your social media presence as a measure of social proof isn’t just looking at numbers, they are looking at engagement. If you’ve got 10,000 Facebook fans and not a one has commented on or liked your posts, it’s going to be pretty obvious your following isn’t sincere. Don’t waste your time on these tactics. People will be far more impressed with an engaged following than a sizable one.

How to get quality instead of quantity:

1. Know your target market
You can’t get better traffic, social media followers, subscribers, etc. if you don’t know what better is. Better means people who are likely to buy your stuff (A.K.A. your target demographic). You need to know who is likely to buy your stuff before you can market to them. So think about who your ideal customers are. If you don’t know where to start on this, I’ve got some tips here and here.

2. Go fishing where there are fish
Once you know who your target demographic is, it’s important to start doing your marketing where they hang out. If your marketing is parents with small children, start advertising on Mommy Blogs and try to hit them up for editorial mentions. If your ideal customer is a comic book fan, see if you can leave fliers in your local comic book shop and start attending comic conventions.

3. Give quality to get quality
If your brand, website, products, content, social media presence, product photos or blog is junk you’re going to get junk. Engaged fans come from delivering serious quality. This means you need to deliver your A game with every aspect of your business. You need branding that people adore. You need high quality products and beautiful product photos. You need an engaging blog and social media presence. You need qualities that make you both unique and adorable in the marketplace. (And by adorable I don’t mean cute, I mean something people fall in love with.)

If you’re posting murky gray product pics shot on a dirty living room rug and constantly tweeting “BUY MY STUFF!! HUGE SALE!!!!” you can’t expect an army of devoted fans to form. People get passionate about great things. If you can’t deliver greatness, you can’t expect passion.

Have you ever looked at a competitor’s Etsy store and wondered how the heck they are selling hundreds of items every month? Their products seem to be totally unremarkable and yet they’re selling a ton of items. Maybe you’ve checked out their Facebook page and seen that it’s teeming with thousands of rabid fans. What the fuck!? You know your products are better, so why is your competitor kicking your ass?

Chances are your competitors’ success has little to do with his or her products. Your competitor could practically be selling excrement in a box and still have these results. He or she is succeeding because he or she is a good marketer. If you’re fixating on what’s so magical about the competitors’ products, stop it. Focus on what he or she is doing to market successfully, that’s probably where the sales are coming from.

Are there people who have a remarkable product, suck at marketing and manage to sell successfully. Occasionally, but it’s not the norm. And we’ve certainly seen people with terrible products who are such rock star marketers, that they’re selling stuff left and right, even if the stuff is nothing special. Selling your product successfully is mostly about marketing. This is why lots of great designers fail, and lots of hacks succeed.

What can you do about it?

1. Realize that marketing is going to make or break your business.
Having a great product will help you, but if the marketing isn’t as good as the product, the product doesn’t really matter. Marketing is one of the most important things you’ll do with your business. You’re competing for awareness with everyone, not just direct competitors. Every minute a potential customer spends looking at an ad for a bank, reading a website promoting a fitness product, etc. is a minute they are not engaging with your brand. There are only so many minutes in the day. If you can’t find a way to get your brand in front of people for some share of their minutes in the day, you’re not going to succeed. People can’t fall in love with a brand if they’re unaware that it exists.

(Looking for more ways to be seen? Check out the back to school advertising co-op.)

2. Pick 3 things
There are a ton of ways you can market your business, but you can’t do them all at once, so you have to prioritize. Pick 3 big things you consider essential to the success of your marketing — these things could be viral marketing, SEO, social media, publicity, etc. Then make a plan to make those things a priority. If you decide getting on page 1 of Google’s search results for certain keywords is what’s necessary, make a plan to do that. If you decide that getting a massive following on Youtube is what’s going to help you, figure out how you’re going to make that a reality.

Study your competitors and try to determine what’s making their marketing work. Are they getting a ton of press? Are they doing live events every weekend? Do they have their products in hundreds of stores? Are they dominating on Google? Do they have millions of followers on Twitter? If you study them closely, you’ll start to get some ideas about how they market. Follow them on social media. Join their newsletter. You’ll start to see some clues emerge on how they promote, and you can use this information to decide if those techniques would work for you.

Need help picking your 3 things? My Marketing Plan ebook helps you break down various marketing techniques and assess them based on objective ROI metrics, so you can make an informed decision about what your priorities should be.

3. Come up with a plan and follow through
Once you’ve picked the big things you’ve decided are important to your marketing plan, break each one into small actionable tasks you can take on each day. Give yourself deadlines and stick to them, then evaluate the results you’re seeing to decide if you want to stay on course or adjust your priorities.

I know a lot of people who start out as creative entrepreneurs do it because they like making things. I know that’s how I started. At first it’s fun making cool stuff for friends and family, then you realize people like what you do and you can sell it. You go online and orders start coming in. At first it might seem like a dream come true, but as time goes on and you go from a trickle of orders to a flood, making stuff gets to be a chore. The bigger you get, the closer you get to max production capacity. You can’t make products 24/7. Plus, running a business is about more than just manufacturing. You’ve got other responsibilities like marketing, customer service, bookkeeping, etc.

One way to combat this issue is working with a professional manufacturer. I do not necessarily mean some factory in a 3rd world country. You can stick to your independent small business values and still bring on help. That’s exactly what we did with Ex-Boyfriend. This week on Vianza, I’ve shared my story about how we arrived at this decision and my tips on finding the right production partner.

If you’re starting to feel like a one-person sweatshop, check out these posts…

I don’t think I’ve mentioned it on this blog before, but I’m a bit of a fitness enthusiast. I take pride in being fit and healthy. I enjoy exercising and eating properly. I have definitely had people look at me and make the assessment that I must have “good genes”. Nothing could be farther from the truth, I’m only able to stay in shape through hard work, watching what I eat, and consistent exercise. I’m telling you this because the exact same principles apply to your business.

Are there people who, against all reason, are able to eat cupcakes all day and still maintain a 28 inch waist? Yes. But that’s not most people. Are there people who have an unfair advantage in starting a business like celebrity status or rich benefactors. Yes. But that’s also not most people. If you’re reading this blog, you’re probably more like me. Your business wasn’t born with a silver spoon in its mouth, so you’re going to have to work to get it in shape.

Here are some things your business has in common with getting in shape:

1. Progress is incremental
If you need to lose 50 lbs, you’re not going to do it in a week. You’ll lose 1-2 lbs per week and it may take a year to reach your goal weight. Those 1-2 lbs per week add up over time. The same thing is true with growing a business. You probably aren’t going to launch a million dollar enterprise in a day. But a few hours every week on SEO here, a few hours on publicity every week there, and at the end of the year you can end up with a thriving business. All those small boosts you give to your search engine rank, your brand awareness, your social media presence, etc. can end up making a big cumulative impact that translates into tons sales.

2. It’s a lifetime commitment
If you’ve ever spent any time with a personal trainer, one thing they’ll tell you is that fitness is not just an end goal, it’s a life time commitment. You can’t work out and diet to reach your goal weight and then return to your old bad habits. If you want to look and feel great for the rest of your life, you need to manage your diet and hit the gym consistently for the rest of your life. If you slack off once you’ve lost some weight, those pounds are going to creep right back on.

The same idea applies to your business. Having a successful business is an ongoing job, it’s not just an end point you’re striving for. Once you start getting the consistent sales you’ve always dreamed of, you can’t take it easy. Competitors are working hard every day and you’ve got to keep up. That means you’ll always be promoting, always be tweaking your product line, always be developing your business. You’re never going to get to a point where you can say “Ah, all done. Let the cash roll in.”

3. No pain, no gain
I’m never going to tell you running a business is easy. Anyone who says otherwise is just trying to sell you something. Running a business is a tough job and it involves pushing yourself beyond your limits — just like getting in shape. Some days I am not so sure I can do all those push ups, it’s hard and I’m tired. Similarly, doing sales work isn’t really something that comes naturally to me. I’m much more of a behind the scenes kind of girl. But when we are short-staffed and need help selling at an event, I do what I have to do and turn on a 1000 watt smile and pretend I do this all the time. In both situations my self-talk is always the same “You can do this, don’t be a wimp. Get it together and make this happen!”

Why am I telling you all of this?
This all might seem like common sense, and you know how I hate “no duh” writing, but I’m telling you this because I really want my readers to undergo a shift in thinking. I don’t want to keep hearing “I can’t have a website, HTML is too hard.” I don’t want people say “I can’t do SEO, it’s too complicated.” All these excuses for why you can’t do something hold you back, so if you’re serious about your business, it’s important to get rid of them.

Do the heavy lifting, it’s what the successful companies you admire had to do. They bit the bullet and made those sales calls to retailers, they invested in the ecommerce software that had the features they needed. Those companies didn’t just read about being awesome, they did the actual work of becoming awesome.

Your challenge for today: Do something hard that will provide meaningful value to your business. Do something you know you should do that you’ve put off because it’s complicated, outside of your comfort zone or costs money. Then make a commitment to tackle all those hard things you’ve been putting off. Set due dates for them and make them happen.

One of the biggest objections I see from my readers, when it comes to making moves to grow their business, is funds. Everything is “too expensive.” This mentality is the exact thinking that will keep a business from growing. Businesses MUST have capital to operate. There are going to be times when your business is cash poor. There are going to be times you need to make large investments. If these aren’t things you’re ready to do, you’re going to find it difficult to take your business to the next level.

Don’t think you’re being too much of a penny pincher? What would happen if you found a product or service you wanted to spend $500 on today for your business. Imagine it’s a new web design that you strongly feel would increase your conversion rate. Imagine it’s an ecourse that would teach you how to wholesale your products like a pro. Imagine it’s materials to launch a new product line that you know would sell like hotcakes. Would you spend that $500? How about $1,000.00? If the answer is no, you’re under-capitalized.

I’ve talked about this topic in the past. While I think you can be judicious with spending, there are going to be times when you have to get out your wallet and “I can’t afford it” is going to hold you back.

If you don’t have personal cash, assets or credit to leverage, investors are a good alternative to infuse cash into a business. Getting investors can be tricky for an inexperienced entrepreneur, but I’ve found two great resources for finding small business investors.

1. Microventures
Self-described as “the financial industry’s first organization which merges peer-to-peer lending with the venture capital industry.” Microventures connects small businesses with investors. To get on their roster, you’ll need to submit an application, along with a $100 payment. If your application is approved, your project will be published to the investors using the site. The $100 fee/application process is a great way to help keep out scammers and people who are not serious about their business, thus protecting the serious investors using this tool.

2. Profounder
Profounder allows investors to invest small sums in your business. When people invest, you set the terms of the investment. You might offer special benefits from the business for being an early investor, like discounts, exclusive product offerings, or invitations to special events. Investors stay engaged with the business by offering support and advice. Investors also receive a share of the business’ revenue, paid quarterly by the entrepreneur for the length of the investment term.

You may notice I didn’t list Kickstarter as a resource. If you are trying to run a for-profit business, I don’t really think Kickstarter is the most professional option. I like Profounder and Microventures because they offer easy access to a legitimate entrepreneur-investor relationship.

* * * * *

On a final unrelated note, I’m excited to announce that I’ll be an Incubator Group Leader this weekend at the DIY Business Association Conference in Brooklyn NY. If you’d like to join me, you can sign up for the conference now and save $26 on your registration. Just use coupon code smallerbox at check out. The conference was founded by a great group of people dedicated to empowering and educating creative small business owners and self-employed/freelancers. There will be lots of amazing guests from organizations such as Design Sponge, Pitchfork, Modcloth, The Huffington Post, eMusic, RollingStone.com and many more. Hope to see you there.

If you’ve been around the marketing blogosphere more than a minute, you’ve probably heard of Seth Godin. When I was new to marketing, the more experienced marketers I knew all suggested I read his blog, so I did. And you know what? I didn’t like it. I know he’s very popular and has a huge army of loyal fans, but his writing just didn’t resonate with me. He would write things like this and I would think he sounded like a freaking fortune cookie. He mostly offers a menu of common sense and platitudes—nothing revolutionary. Nothing specific and actionable I can apply to make my business better.

The writing he produces that doesn’t revolve around what are, in my opinion, no-brainer observations, focuses on things that are too vague to be of use. Here’s a classic. The gist is that when you market online you can keep trying to bring in more visitors/customers or try to romance the ones you’ve already got.

I know I learn best from concrete explanations and examples, so that’s how I write. I hope that the people who read Smaller Box appreciate this method of learning and that my writing resonates with them. This is also why I enjoy blogs like Get Elastic. Their writing is full of examples and specific actionable ideas based on case studies. This article doesn’t just say “Overcome resistance with incentives”, it gives me a specific example, complete with visuals, on how an ecommerce company does exactly that. That’s advice I can understand and apply to my own website.

I feel only a tiny bit bad picking on Seth. I don’t really like to pick on anyone, but he’s a popular guy with a huge following and he probably has a thick skin, so he can handle someone like me saying his writing isn’t my cup of tea. Plus, I know a lot of people do enjoy his writing, so read whatever floats your boat. This article is mainly about my problem with people reading the writing of a “guru” just because he’s considered a “guru”, and I think a lot of people do this. What I’m asking you to do is take a really critical look at the people you follow for business advice and decide for yourself if they provide value and make you better at running your business. Ignore their fan count, their ranking on the best seller list, etc. And most of all, ignore the fact that what they’re saying makes you feel warm & fuzzy. It’s easy to want to listen to people who offer blind, unconditional encouragement; we all like to have our egos stroked. But do they make you better at what you do? If not, find a new role model.

I’m not a famous guru, but here’s why you might want to listen to me anyway:

So when I write my recommendations on this blog, it’s not conjecture or guesswork or me making things up; it’s all based on my own experience selling thousands of products online every year to customers all over the world.

3. I understand the hard and fluffy parts of running a business
A few weeks ago I wrote about balancing what I call the hard and fluffy parts of your business. Most people, especially those without much experience running a profitable online retail business, really understand and gravitate towards one side or the other. They either really love the technical side (things like SEO, A/B testing, etc.) or they really love the softer science part of business (things like mission statements and connecting with your niche). I love both. I’ve had to learn to love both because my business depends on it. So when you read Smaller Box, you’re going to get a dose of both sides, because you need both to succeed. I know most of my readers are drawn to the fluffier side of business, so I try to write about the more technical aspects in an accessible way.

4. I tell you what and how
A lot of business and marketing blogs only tell you what. They basically dispense advice like “be awesome.” They don’t tell you how to be awesome. My brain doesn’t work that way, so I don’t write that way. I both suggest being awesome and write about specific actionable things you can do to be more awesome. That’s why I don’t write “Design product packaging that’s memorable.” I write specific articles about how your peers have done this, so you can get specific ideas of your own on how to make your packaging more awesome.

Your challenge for today
So many of the “experts” in the business and marketing blogosphere are glorified cheerleaders. They talk about how you can be more successful and say things that sound good and make you feel good, but they don’t actually make you better at anything. So my challenge to you is this: get rid of one false idol from your regular reading intake. Really evaluate the marketing and business experts you regularly follow and think about whether they’re providing concrete value and making you better at running your business. If not, get rid of ‘em and use that time you spent reading their blog, books, Tweets, etc. on something more productive.

Today I want to talk about the difference between modeling your business around transactions versus relationships. This ties into what I talked about earlier this week with regard to customer lifetime value. First, my post Monday was mostly geared to business models that focus on customer relationships. Not all business models have this as a focus. Here’s are some characteristics that make these models different:

Transactional Business Models

• Focus is on getting the sale, not getting repeat customers
• Business offers no remarkable brand experience
• Business sells mainly utilitarian items that people seek out when the items are needed
• Customers are motivated primarily by price
• Marketing efforts rely heavily on SEO and programs like Google Adwords, tools that drive customers to the business when customers are shopping for the products they sell.

Here’s an example of what I mean. Last summer we decided it would be nice to string some white Christmas lights around our backyard for evening lighting. We googled “outdoor white christmas lights” and visited sites like Novely Lights and Christmas Lights Etc. I can’t even remember which one I ordered from, probably whoever had the best price. They sold pretty much the same product, and it was the product I wanted. It was also a product I wasn’t going to form a real emotional attachment to or shop for regularly. Trying to form a relationship with me as a customer was probably going to be useless for these businesses and their lack of remarkable branding had no influence on my purchase decision.

If you sell a product like Christmas lights or car batteries, it might make sense for you to focus your marketing on transactions vs. relationship building. You might have some chance of building a relationship as a supplier for a landscaper or mechanic, but probably not with the average retail buyer.

Relationship-Based Business Models

• Focus is on getting repeat customers, emphasis on lifetime value of customers, not individual transactions
• Business is heavily focused on creating a unique brand experience
• Business sells items that people want (instead of need), and shopping behavior can be motivated by new offers or desire for product (i.e. if you sell jewelry, customer is equally likely to buy because they love a new bracelet that was just released vs. needing to get a gift for a friend’s birthday)
• Customers are motivated to buy based on uniqueness of product and brand experience (i.e. they can buy a bra any place, but they choose a Victoria’s Secret bra because it looks sexiest.)
• Marketing efforts rely heavily on advertising, PR, social media, email marketing, branding
• Business may sell a type of product many competitors sell, but have a unique spin on the product either via the products themselves or the shopping experience (consider brands like Banana Republic, Nordstrom, Pottery Barn, Hot Topic, etc.)

In contrast with my Christmas lights example, consider a brand like Tiffany & Co. On the face of things they sell jewelry, but that’s not all. What they sell is an experience. They sell the idea of a classic, the ultimate good taste, luxury. Everything about shopping with Tiffanys is an experience from the unique yet timeless aesthetic of their products to the famous little blue box with the white satin ribbon your jewelry is presented in.

My wedding band is from Tiffanys and it does have a different look and feel compared to other jewelry I own.  The designer’s name is inscribed inside the band, along with the famous Tiffanys logo. The ring has a heavier weight to it and it doesn’t look like a ring I’ve seen any place else. You can say a ring is a ring and tons of places sell them, but this one is distinct and it’s associated with a distinct brand, which caused me to favor this ring over the alternatives.

When I have a really special occasion that calls for jewelry, something that I want to be remembered, Tiffany’s is the first place on my shopping list because of the brand experience and products they offer.

What this has to do with you
As a business owner, you really have to think about what kind of business model makes sense for you. The kind of model you choose dictates everything from your marketing strategies to your website copy to your products and product presentation. If your focus is transactional, you want to devote your resources to acquiring sales. You need the best SEO and the best Adwords campaigns.

If your focus is relationship based, you need to really think about crafting every aspect of your brand in a way that’s remarkable.

Select a model that is appropriate for products you sell and the kind of business you want to build, and focus your attention on the strategies that are most suitable for your business model.

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When you think about selling your products online do you think about acquiring sales or do you think about acquiring customers? For many online retailers, in fact many business owners, the focus is on sales, not customers. This wrong-headed thinking can actually cost you money. Here are some ways this mentality gets you into trouble:

1. Short-Sighted Customer Service Policies
The number one rule of customer service: treat your customers the way you’d want to be treated if you were in their situation. Sometimes this means losing a little money in order to preserve a long term relationship. Most of us dread dealing with customer service at any business. We expect to be put on hold. We expect to hear “no”, even if the mistake was on the company’s part. It’s a nightmare. So when we have a great customer service experience, we not only have positive feelings about the business in question, we tend to recommend them to other people.

Examples of customer service gone awry that loses you customers:
I bought a ticket to go to Japan earlier this year, then a tsunami struck, causing me to change my vacation plans. What did United Airlines do? They charged me a $600.00 change fee and made me spend an hour on the phone with their customer service people. They made changing my plans expensive and inconvenient.  I hope they really enjoyed that $600.00, because this frequent traveler will NEVER fly them again. That 1 hour of my time and frivolous $600 charge (after I’d already spend $2000 on tickets), cost them a customer for life, a customer who would have spent tens of thousands of dollars with their business over the next few years. All that to get $600.00!

My husband bought a case for his new iphone 4. The company sent him the wrong case. They insisted he send back the wrong case, in order to get the correct case. Even if they reimburse for the shipping, they are forcing their customer to pay for the shipping initially, further delaying the arrival of the product he ordered several weeks ago and giving him an errand to run. Guess where we won’t be shopping next time we need an electronics case?

(By contrast, on the rare occasions that we send the wrong item to a customer at Ex-Boyfriend, we just tell the customer to keep the item and pass it on to a friend, and we send the correct item right away. As a result, we get happy customers, positive word of mouth and maybe our product ends up in an additional customer’s hands that we hadn’t planned for.)

2. Weak Attribution Management
Attribution management is one of the most widely misunderstood concepts among inexperienced business owners. First of all, let’s define the term. Attribution management, means tracking the source of your sales, with the understanding that sales often come from more than one source. For example, let’s say you run an ad on a blog. A customer clicks your ad, sees your stuff but doesn’t buy. Let’s imagine they clicked your Facebook “like” button, and a few weeks later they click a link from your Facebook page to your site and make a purchase. Which source resulted in the sale? Was it Facebook? Was it the ad? The answer is both, and this is where attribution management comes in. Attribution management looks at the first click that delivered a sale, the last click and interim clicks that served as assists.

Currently, attribution management can be tough to track without sophisticated tools or some programming skills. (I personally created my own attribution management system for my website using cookies and IP addresses.) The good news is Google Analytics is releasing attribution management capabilities pretty soon. The feature is currently in beta testing.

Why does this matter?

If you think of acquisitions in terms of sales instead of customers, you may cut off a productive marketing channel that is providing valuable assists, even if it is not contributing to direct sales. It may be effectively nurturing customer leads, even if it’s rarely the impetus to get people to buy. It may be keeping your brand name in the forefront of the customer’s thoughts, so when they Google your brand name and make a purchase, that isn’t just by luck, it’s those tools you used to foster customer relationships that put your brand name in their heads.

Examples of these marketing tools might include blogging, advertising, social media and email marketing.  Just because you don’t see direct sales from them each day, doesn’t mean they aren’t turning people into customers.

3. Lack of Customer Relationship Management
If you think of customer transactions as a one-and-done deal, you lose your chances of bringing them back for subsequent purchases. Once you’ve had someone buy something from you, the goal is to keep in touch with them, so they buy again in the future. Even if you don’t sell the kind of product people buy over and over, maintaining a relationship with past customers encourages them to recommend your business.

Now when I say keep in touch with customers I DO NOT mean sending them constant annoying sales emails. No one likes that. You need to employ a little gentle persuasion. Think about things you can do to keep them interested in you without selling to them constantly.

Here are some things that have worked for us at Ex-Boyfriend:
- Free Downloads
By offering our fans fun free products like drink markers, notecards, etc., we give our customers a fun reason to re-visit our website. Free gifts are a great way to engender a positive experience with the brand and keep our branding in front of our audience.

- A Good Blog
Notice I didn’t say blog, I said a good blog. A good blog is one with content that’s genuinely interesting for your customers. It’s not filled with sales content or boring details about your personal life and photos of your kids. It’s fine to include some personal elements and some sales copy, but if that’s the focus of your blog, no one is going to read it. At Ex-Boyfriend we share funny videos, cocktail recipes, comic strips, etc. Our primary goal is to keep our fans entertained and connect on a personal level, not sell them stuff. Getting them to shop with us is a natural by-product of having fun content.

- Social Media
Like a good blog, a good social media presence doesn’t contain non-stop sales copy. A little sales copy is okay, but the focus should be on content your audience finds interesting. This can include sharing your entertaining blog posts, asking a question that prompts conversation, sharing fun stuff you’ve found online, etc.

- Email Marketing
There are lots of schools of thought on email marketing. Some people advocate frequent contact, some people advocate regular, but not constant, contact. I think 1 or 2 mailings per month is a nice amount for retail businesses. It’s not so frequent that people will unsub because you’re spamming their inbox, but it’s often enough that they don’t forget about you.

Like social media and blogging, make sure your email content provides some value above and beyond sales messaging. You want to give people a reason to open those messages, and if they expect nothing but sales talk, they are less likely to open.