Sales Strategy Guide

The difference between runaway business success and mediocrity often comes down to developing and implementing a great sales strategy.  Yes, you need a great product that uniquely addresses a market need.  And marketing dollars are always helpful.  The final measurement success is revenue and profits, which means you should focus on Sales.  Sales. Sales.  Read Sparxoo’s spin on “Grow and Harvest Your Business” by Seth Godin. resourcepage_sales_growth_tn

Build a Talented Sales Team


resourcepage_sales_building_tn Great sales starts with building a great sales team. You’ll want high energy, strong relationships, the ability to reach influencers, and great communication skills.  Once you create the perfect team, provide leadership to elevate their performance.

Connect With Sales Prospects


resourcepage_sales_connecting_tn Once you’ve assembled a great sales team, set them loose to win accounts.  Mine existing relationships and form new ones.  Consider the impact of influencers as you build valuable relationships.

Make the Sale


resourcepage_sales_shakinghands_tn Now that you are in front of your audience, it’s time to wow them with a great presentation and build momentum to close a sale.

Long-Term Focus on Sales Growth


resourcepage_sales_growth_tn Making the sale is an important milestone in implementing your sale strategy.  Your company’s growth depends on your ability to deepen customer relationships.  It is often said that 80% of your profits will come from 20% of your customers.  Mike Carroll of Intelligent Communications says, “The success of your business comes down to the customer experience. Make your customers’ satisfaction your priority.”

Must Read Articles: Focus on Sales Growth


insiders_innovation_thumbnail Once you have a strong priority that addresses a product need, make sales your priority.  The more your sales increase, the more you can expand your business.

How Southwest Made its Underdog Brand-Attitude Profitable

Southwest is a business in the front, party in the back brand. Before all else, Southwest is a bare-bones player that cares first about delivering the lowest fares. The party in the back is about having fun while doing it. When Southwest burst onto the scene in 1989, it challenged its peers by offering the lowest air fare. Since then, Southwest has adopted a fearless, roughneck brand persona that is accentuated by CEO arm-wrestling matches, rapping flight attendants and giving profitable online travel agencies a big F%&# You! Southwest’s rollercoaster ride to the top is a testament of how a budget brand mean more than its bottom line.

How has Southwest made the charismatic, energetic, youthful, rebel persona work for its brand? For one, it’s a differentiator. Every airline needs to be safe, trustworthy and shouldn’t break the bank (for the most part). That’s the baseline criteria for any airline. Yes, Southwest is safe, trustworthy and has THE lowest fares, but the airline elevates its brand position by creating an additional layer of comfort via its brand personality. Southwest is fun, quirky and has a sense of humor. For instance, if Delta, United Air, Virgin America, JetBlue were at a bar, they would be huddled around Southwest — eagerly listening to its whimsical stories. In other words, Southwest is a brand you want to befriend. The budget airline differentiates itself by creating an additional layer of comfort that is re-assuring to its customers. That added comfort has served the airline well…

Southwest is one of the most profitable airlines — posting a profit for the 37th consecutive year in a row. Indeed, the airline net $99 million in 2009. Its success among its peers is astonishing considering the volatile market in the early 2000s. The top five US airlines that went bankrupt and were quarantined to the losers table, while Southwest was the only winner. Though the economy airline took a dip in mid to late 2008 (when it trimmed its flight schedule — which is up 6% from 2008), since its lowest dip on March 2, 2009, the economy-class rebels have made a steady recovery — returning to its peaks in early 2008.

Southwest has the 3rd largest passenger fleets, but like Google, it tries not to be evil. Throughout its history, it has made strong efforts to shed its corporate image. For instance, Southwest’s former CEO settled a legal dispute in an arm wrestling match, its flight attendants have rhymes, and Southwest will do everything to in its power to keep prices down, even if that means giving Orbitz, Expedia and every other online travel agency the finger.

Malice in Dallas

In the Wild West, arguments weren’t solved in court — they were settled at high noon on the streets. No one more embraces the Wild West, band-of-outsiders attitude than its former CEO Herb Kelleher. Instead of wrapping itself in red tape, Stevens Aviation’s CEO challenged Kelleher to an arm wrestling match to resolve the copyright infringement of Southwests then, new slogan “Just Plane Smart” and Stevens Avation’s “Plane Smart.” The loser of individual matches would donate $5,000 to their charity of choice and the overall winner would keep the slogan. Unfortunately Kelleher didn’t pump enough iron (or smoked too much) to beat-out Stevens’ CEO. Video of the events were distributed as internal marketing materials to Southwest employees to illustrate the brand culture its CEO strived for.

Rhyme Master Holmes

Nearly a decade after Kelleher’s arm wrestling one-off, Southwest hasn’t lost its charm and eccentric flare. Flight attendant David Holmes, tired of giving the typical in-flight announcement, decided to rap it. When was the last time a flight attendant rapped the in-flight announcement? If you weren’t riding with Southwest’s Rhyme Master Holmes, probably never. As Holmes notes at the end of the announcement (see below), you are not going to find “that” on United Air.

Circumventing OTCs

Just as tech outlier, Apple gave Adobe Flash the middle finger, Southwest gives a highly profitable online travel agencies (OTA) a big F&@* You. True to its mission of being “THE Low Fare Airline,” Southwest circumvents OTA’s commissions to offer the lowest prices possible on its branded online booking system. Though the short-term profits might be enticing, Southwest understands the value of looking ahead.

Southwest is arguably one of the most successful airlines. On top of its superb financial record, the budget airline has a strong brand persona — one that is rebellious, fun yet not reckless. Through its fun, quirky personality, Southwest creates an additional layer of comfort that is re-assuring to its customers. Furthermore, it had many chances to sacrifice parts of its brand culture for short-term gains but took wisdom in the future. Branding should be about what you want to be and making small gains towards that vision.

Blurts Launches Social Media Initiative for Voice

Facebook, Twitter, and Four Square have become the new digital leaders by enabling users to connect with each other and share ideas, experiences, and ultimately their lives. Much of the interactions rely on a visual exchange of text and images. A new startup, Blurts believes there is another sense that can be tapped into to enhance social media. If you were going to guess taste or smell, well the digital world isn’t quite there yet. Blurts is bringing audio to social media in a new way. It’s kind of like twitter for podcasts.

Blurts enables you to bring photos, video, tweets, sms, email and comments to life with “tweet”-like 30 second recorded audio. Blurts trumpets the benefits of adding personality and expression into an exchange. It’s one thing for me to say I’m a Phillies fans rooting for them to return to the World Series. It’s another to hear the inflection in my voice that comes from 30+ years of rooting for the Phillies. Blurts founder Jeff Stier says, “Voice is the most fundamental form of human conversation, communication, storytelling and socialization but has been largely overlooked in social networking presenting a large, untapped opportunity.”

With the proliferation of new tools, how is Blurts going to cut through the clutter? Influencers and Celebrity Media. At Sparxoo, we believe in the power of engaging influencers through social media. We’ve also covered celebrity media such as MTV’s Twitter Jockey and the Bravo – Foursquare partnership. In this spirit, Blurts is launching with Oxygen’s Bad Girls Club on September 14th. Beyond that, the startup has plans to bring other celebrities on board to share their voice and personality.

Beyond its celebrity initiatives, Blurts is going to ride the mobile wave. As we have covered at Sparxoo, the mobile revolution is here . We all know that voice is the only app 100% of mobile owners know how to use, a reality that Blurts plans to take advantage of. To enhance the audio file, the Company has enabled a 4-6 key word transcription as a text preview of a Blurt. Our team tried out blurts and was surprised at how easy and fun it was to create blurts. Our favorite blurt is a gargling happy birthday blurt. It’s also fun to check out the Company’s repository of famous blurts.

Our friends at Blurts have asked us to encourage you to take a look and share with your friends. About Blurts (from their founding team):  Blurts offers a globally scalable platform for creating and managing “micro audio content™”, or Blurts–30 second spoken stories, shout-outs, tips, anecdotes, testimonials, captions, voice-over—that can be easily recorded and tagged to photos, videos, Tweets, SMSs, instantly adding context, sentiment and authenticity to any social post. Blurts portends a new era in online social interactions and experiences where voice takes a prominent place next to text, photo and video as means of online self expression. Blurts offers an easy-to-use interface for consumers, brands, web sites and bloggers to add the power of voice—texture, tone, emotion and authenticity—to the emotionally-challenged text format of tweets, sms, FB posts, comments, reviews, polls, etc. The Blurts technology can be integrated into any web site, blog or social media platform. Additional information can be found at www.blurts.com.  It’s easy and free to sign up

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2010 Best Global Brands – The Stock Market & Risk

Interbrand released its 2010 Best Global Brands report this week (brand report highlights).  This is the 12th year that the report has been published, and we’ve often wondered if there are deeper insights that can be garnered from this report.  We’ve analyzed the past 12 years of data with a specific eye to the following questions:

  1. Do changes in brand value predict changes in stock value, or merely reflect information that is already priced in?
  2. Do the brands with the strongest momentum hold up in recessions?
  3. Can the report provide insight into the broader market?

Let’s take a look at what we found …

1.  Do changes in brand value predict changes in stock value, or merely reflect information that is already priced in?

We analyzed changes in brand value along with changes in past and future stock market performance.  Specifically, we focused on the top 1/3 and bottom 1/3 performing brands each year based on year-over-year % change.  Our hypothesis was that there would be high correlation in the best performing brands also having the best stock performance over the past 12 months.  This is true.  In every year EXCEPT 2010, the best performing brands also outperformed on the stock market in the prior year.  We will return to the 2010 exception below.  As for the correlation with brand performance in future years … one would expect that if there is “special insight” from the Interbrand team, brand perfromance could be predictive.  We found that there is some correlation of future gains (although a bit weaker).  However, we noticed that there is inverse correlation of future performance at times when the business cycle changes.    This leads us to question #2.

2.  Do the brands with the strongest momentum hold up in recessions?

The answer is complex.  Yes, the largest brands tend to retain their brand value over time.  For example, Coke, Microsoft, IBM, and Disney have been near the top of the list since inception.  However, it appears that those brands that had the strongest momentum leading up to a peak (2000 and 2007) are the very ones which performed the poorest immediately into the recession.  As an example, Amazon.com grew its brand value from $1.4 billion in 1999 to $4.5 billion in 2000, only to fall back to $3.1 billion in 2001.  Likewise, AIG rocketed up as a new addition in 2007, only to lose brand value in 2008 and fall off the list completely in 2009.  In fact, most financials were above average gainers in 2007, before significant drops in 2008.

brandchart

Ultimately, 12 years worth of data shows this:  Strong performing brands continue to gain momentum as long as business conditions remain relatively constant.  However, when there are major shifts in business, brand performance works in reverse.  This makes sense.  Since an excelling brand is built to gain momentum in the current environment, it can be difficult to adapt to sharp changes.  This gives opportunity to other large, yet lagging brands, to make some gains on a relative basis.

3.  Can the report provide insight into the broader market?

This is where the analysis gets really interesting.  In the chart above, we see the negative green bars in 2000 and 2002 which signal changes in the business cycle (the tops and bottoms of the market).  In 2007, we again see the signaling of a business peak with the negative green bar.  If 2009 was indeed the end of the recession and market bottom, a negative green bar would be a confirmation based on the theory above.  However, the green bars for 2008 and 2009 were actually the most positive.  Meaning that brands that adopted to the new normal quickly performed the best.

brandchart2

What’s even more interesting is that in this 2nd chart, the orange bar in 2010 reflects that the poorest performing brands actually did the best in the stock market even while their brand values were lagging.  This is the first time that brand and stock market performance were inversely correlated in the same 12 month span.  For anyone who reads Minyanville or watches Mad Money over the past year, you’ll know that commentators have spoken about how the most speculative stocks have risen the most since the market bottom.  For example, Ford brand value went up 1% in 2010 while its stock price went up 49%.  Likewise, even though Harley Davidson brand value went down 24%, its stock managed to rise during the same period.  And some of the stronger, safer brands actually fell on the stock market (JP Morgan: +29% brand value, -16% stock price) and (Shell: +24% brand value, -2% stock price).

What does this imply?  For the past 12 months, investors have preferred riskier, more speculative plays regardless of underlying strength or weakness in brand.  This is actually a scary thought because with the market just above 10k, it doesn’t seem that the market is particularly speculative.  In fact, it seems that everyone is hiding in treasuries and bonds.  A pure interpretation of these charts leads to 1 of 2 possible conclusions:

A)  We have entered a new normal in which the business cycle has shifted, but not reversed completely from the bottom.  If this is the case, then the recovery will look more like a square root symbol than a V-shaped recovery.  Slow, steady growth is on the way.

B)  If the 2010 chart rhymes with 2000, 2002, and 2007, then the green bar for 2010 might be dramatically positive.  What that means is that the highest quality brands will perform dramatically better over the next 12 months than weaker brands.  You’ll note that some of the brands that performed the best on the stock market in 2010 include luxury plays such as Burberry and Cartier despite very little brand momentum.  A scenario that favors the flight to quality typically coincides with a pullback in stocks.

At Sparxoo, we focus on cultural trends.  Periodically, we observe major moments that lend insight into the macro economy.  Our last such moment was in May 2009 when we observed that America wanted to restore confidence and wanted happier times as signaled by Kris Allen’s victory in American Idol (social mood analysis).  Our analysis of this Interbrand report shows that we are clearly not in the midst of a classic recovery.  The numbers and charts point to a square root or W recovery over the preferred V recovery.  Despite the apparent stock market recovery, we believe that risk remains high.

We reiterate our prior guidance on risk: “The velocity of risk-taking is slowing. With the slower game, it’s not necessary to take every risk, it’s necessary to take the right risks. Doing nothing remains an attractive option as additional opportunities will present themselves in the future.”

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How to Inject Humor into Brand Advertising Campaigns

In the documentary, Art & Copy, creative advertising executives talk about how vilified and dirty advertising is perceived by the average consumer. Some even re-word their job description to appear unconnected to the industry. But why? Most brand advertising and marketing — say 90 percent of it — is annoying white noise in the backgrounds of our lives. “As advertising blather becomes the nation’s normal idiom, language becomes printed noise,” says George Will, quoted in Stephen Donadio. However, “top shelf” brand advertising campaigns stand out from the clutter, connecting with a message while making us laugh, think and even cry. Over the years, established brands such as Coca-Cola, Nike and Apple have raised their profile through their unique ability to make an emotional connection with us.

Quite simply, if you want to connect brand with consumers,  make them laugh or make them cry. The former is a common brand marketing and advertising goal, but can be elusive. Superbowl commercials are famous for injecting humor to get a chuckle. (Check out our expert marketing analysis of Kia’s puppet advertising campaign, GoDaddy’s sex-sells brand strategy, Hyundai’s customer service value proposition, and Cars.com’s emotional marketing strategy.) To bring the joy of laughter and connect with customers, here are some pointers to get your started:

Ever watch a movie that you find hilarious and your spouse or friend shoots you an odd look that says, “Really, you think that is funny?” Us humans are fickle beings with distinct sensibilities when it comes to humor.  Budweiser and Volkswagen brand advertising campaigns are customized to their target audiences. Budweiser’s humor is clearly targeted at a base-level humor that skews young male. For Budweiser fans, humor is instantaneous — starkly contrasted by Volkswagen, which seeks to connect with a more intellectual, sophisticated consumers. As an advertiser, develop and test messages against your demographic marker, recognizing that your non-target might not laugh, and that’s ok.

After you’ve identified your target audience position, determine what makes them laugh. What comedian do they love? Do they laugh at a more sophisticated humor, such as the Daily Show (Volkswagen), or the base-level humor of Larry the Cable Guy (Budweiser)? Typically, Daily Show humor is witty and pointed yet requires brain power to understand whereas Larry the Cable Guy plays on stereo-types — requiring little creative or intellectual stretch.

Here are marketing strategies for injecting comedy into brand messages:

1) Use real-life problems and issues. Re-enacting a problem with a comedic twist helps viewers relate to your commercial.

2) Be inquisitive and figure out why people do the things they do. You might be surprised what motivates them.

3) Dramatize characters that are found in the viewers real lives. Much like using real-life problems, viewers can relate to realistic characters.

4) Be unexpected. Jokes are not as funny if the punchline is expected.

5) Don’t take yourself too seriously.

When you have a firm understanding of what hits your audience’s funny bone, it’s time to get creative. Loosen up. Watch some of your favorite comedies, play charades or board games with team members to get in the mood. Think about your product, marketing landscape, and company through the lens of your target audience’s favorite comedian. If Larry the Cable Guy were to crack a joke about your product or service, what would it be? But remember, though a joke might be funny to you, consider whether it is offensive. Remember, your audience will likely not be the only ones viewing it.

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Top 5: Business Partner Checklist

Consider your business partnership in a similar light to your significant other: you are in it the for long haul for better or worse (unless otherwise indicated in your agreement, or course). Although some personal partnerships can feel like they have that caveat, business partnerships are long-term, collaborative endeavors and should not be taken lightly. Vetting potential partners is integral to the growth and sustainability of your business, as both of you are shared architects in the venture.

Above all else, your business partner is upholding the business you spent countless hours building, so they should approach your strategic goals with the same enthusiasm and tireless work ethic. There are numerous other criteria to evaluate who would make an effective and productive partner. Here are the top five:

Communication, Communication, Communication. What happens when there is miscommunication in your personal relationship? You don’t get the dry cleaning done in time for the big social event, or you didn’t realize you needed to take car to the mechanic and it need an oil change (although your spouse told you many a’time) — and an argument ensues. The same goes for business partnerships. You need to effectively communicate everything from short-term strategic goals to long-term aspirations to head down the same path.

Value Add. Just because they’re your good buddy from college, doesn’t mean they are going to make an effective and productive business partner. The partner needs to add value to your business. What skills do they possess to advance the momentum of the business? Do you require an expert marketer or a person with an analytic mindset? Find the gap that is preventing your business from reaching its full potential and fill it with an expert.

R-E-S-P-E-C-T. Though you might respect your partner’s skills, would they respect you? After all, you are going to be making significant strategic decisions together and if they cannot respect your opinion, you’ve ceded control and it’s no longer a partnership. They need to be able to trust your decisions as much as you theirs’.

The Separation Between Business and Personal. Though you might have found an industry expert, do they come with a lot of excess baggage? The last thing you want is an irresponsible personality dealing with the future of your business. How do you know if they have a lot of excess baggage? Call personal references, ask around about them. If they have a checkered past, it might not matter how much of an expert they are… their destructive personality could be poisonous to the overall health of the company.

Are They Trustworthy? You and your partner are sharing in the future success or failure of executive decisions and with that responsibility comes incredible trust. You have to rely on them to perform, communicate and reach key goals. After performing some background research — both regarding their professional and personal lives — do you think you can rely on them to advance your entrepreneurial vision?

Interbrand’s 2010 Best Global Brands – Apple Largest Riser

Last year we covered the steady growth of Coke and the rise of Google in Interbrand’s best global brands report.  This year’s rankings showed significant change with Apple and Google leaping, and Dell, Toyota, Nokia, and Citi plummeting.  Interbrand’s report highlights that consumer behavior is more difficult to predict than ever.  Interbrand’s best global brands report says, “the current economic climate is a risky landscape for today’s brands … one that is fraught with contradictions and vocal customers scrutinizing your ever move.  The same customer might opt to buy an iPad instead of a laptop, purchase private label toothpaste, and then match a Zara skirt with Christian Louboutin shoes.”

Apple seems to be getting a lot of praise these days.  We previously covered Apple surpassing Microsoft as the largest tech company by market cap.  Now it is the fastest riser in the leading brands report.

Among the notables in these rankings:

  • Internet and Tech companies continue to the lead the way:  Apple (+37%), Google (+36%), and Amazon (+23%)
  • Starbucks remains a lower tier brand that is barely on the list (growing 2% to $3.3 billion)
  • BP, which had previously had a more valuable brand that Prada, Lexus, Ferrari, and Polo RL, has fallen off the list
  • Newbies include a number of unhealth beverage brands including: Sprite ($5.8 billion), Jack Daniels ($4.0 billion), Corona ($3.8 billion), Johnnie Walker ($3.6 billion), and Heineken ($3.5 billion)

 

August Funding Trends: Data Management

The latest, largest Mac Pro has 512 gigabytes of storage, which means two Mac Pro’s would yield just over one terabyte of storage. There are 1,000 terabytes in a petabyte. And AT&T processes 19 petabytes through its network each day and Google processes 24.

We have already reported on web intelligence and smart computing, but as we increase the amount of information output, businesses and consumers are seeking ways to organize and manage it. We found August venture capital funding leaned towards data management utilities in numerous industries, from consumer mobile, to business to consulting.

Here are several data management tech companies that found funding in August 2010:

Mobile
CallVine ($4 million from S3 Ventures) developed an Apple iPhone iOS 4 app that allows users to simultaneously call and manage conversations with numerous people. The mobile app is similar to Skype’s conference capabilities.

GroupMe ($850,000 in early stage financing from Betaworks, First Round Capital, Lerer Ventures and SV Angel) is where the semantic web meets web 2.0. The company developed technology that allows individuals to send and manage text messages to multiple people.

BoxTone ($7.5 million in series B from Lazard Technology Partners) created the Mobile Service Management solution for enterprises and government agencies to manage, monitor, support & secure mobile users and mobile applications across BlackBerry, iPhone, iPad, Android and Windows devices.

Business Management
6fusion ($3 million in first round of institutional funding from Intersouth Partners) created a single utility to meet the needs of the IT Service channel through an algorithm that takes control of third party computing resources called the Workload Allocation Cube (WAC).

Security
Scio Security ($1 million, investors were not disclosed) developed Trusted Path, a technology that allows market participants to have greater security management with internet financial transactions by leveraging consumers’ existing mobile devices.

Consulting
Blue Cod Technologies ($8 million from GE Pension Plan and Edison Venture Fund) “provides management and IT consulting software solutions for the insurance, financial and utility industries.”

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Top 5 Brand Culture Tips

Think of your brand as you would your body. Imagine three months of eating Big Macs, fries, lounging on the couch, sleeping 15 hours a day. Next, think about three months of eating fruit salad, vegetables, doing Yoga every morning and sleeping 8 hours a day. The gap between lifestyle one and lifestyle two is filled with ambition and a proactive attitude.

Those brands that sleep on couch watching TV, eat Big Macs are likely not going to live long, happy lives. As owner of your brand — as you are with your body — get up, take the initiative and be proactive in living life to its fullest. This lifestyle is called culture and just as good diet, exercise and sleep does the body good, building a brand culture requires ownership over your environment, language, education attitude and social life.

Language – Flash back 30 years. If you wanted a cup of joe, you’d stop by your run-of-the-mill diner. An espresso might have been confused a super-fast subway. Zev Siegl, Jerry Baldwin and Gordon Bowker sought to change how Americans view coffee by started a small European-style cafe, called Starbucks.

The founders created a brand culture that reflected what they found in Europe. Cashiers weren’t called cashiers, instead baristas (Italian for “bartender”). Starbucks language empowered its employees by transforming them from a simple cashier to a Eurpean barista. Large, medium and small became tall, grande and vente. Simple adjustments to language, as Starbucks illustrates, can engender completely different culture. Just ask barista serving up a frappucino.

Environment – Running late for a client meeting? Don’t take the stairs. If you’re in Red Bull’s London office, you should opt for the slide. Creative and inspiring work environments were once the domain of ad agencies, such as Olgivy & Mather. Not any more. For Red Bull, a slide makes sense: it saves time, energy and lightens your mood before the big client meeting and is in-line with the energy drink’s high-energy, adventurous brand.

Training – Why has Wegmans, a small and cautiously growing East-Coast grocery store, made the shortlist of best places to work? I challenge you to walk into a Wegmans, ask any employee a question and they will drop what they’re doing and find out. They like being there and want to help customers. If they don’t have an answer, they will personally escort you to someone who does. How does Wegmans develop such a positive brand culture?

Education. Wegmans employees must go through four weeks of training. Investing so much in every employee is costly, but ultimately creates a sense of ownership and forms a bond between employee and brand. It’s a give-take relationship. The more time you invest in your employees, then more they invest in your brand.

Attitude / Aptitude – Anyone that’s worked in the corporate setting understands the importance of personality. Your co-worker thinks he’s in a fight with you for a promotion or your boss probably secretly despises you — all bad for a positive brand culture. The online shoe retailer, Zappos, aims avoids “bad apples” in the early stage of the hiring process. Every employee must undergo two interviews: the first of which tests your skills to complete require tasks and the second ensures you’re a good fit for the Zappos brand. In this way, Zappos crafts its internal brand culture by hiring like-minded people.

Community Building – Google might have placed anywhere within the above categories, but its strength comes from its sense of community. In addition to its community building initiatives, such as foosball tables, pet-friendly offices, eco-transport on its Googleplex campus, employees are divided into project teams, such as Gmail, Google TV, Wave, etc. Project teams make individual employees a part of the collective whole. No one person is greater than the others because everyone is working on the same level, towards the same goal.

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How to Create Effective B2B Loyalty Programs

Loyalty programs are often discussed through a B2C lens, but B2B loyalty can have impressive returns. For instance, five percent improvement in customer retention can yield 25 percent to 100 percent increase in profit. Conversely, the cost of losing a client can have a devastating effect. The costs associated with acquiring a new customer are five to six times what it takes to generate an equal amount of new business from an existing customer, writes Bob Murphy, Managing Partner of Moveo Integrated Branding. How can product and service providers retain client loyalty?

Bob Murphy suggests first identifying “hard” and “soft” customers. Then determine what motivates “hard” clients to stay brand loyal. If you have “soft” clients (i.e. not brand loyal), consider qualitative interviews with industry experts to determine key decision drivers. The synthesis of your interviews can help determine your company’s position in the marketplace and re-craft your value proposition. Once you have a clear brand message, you can begin developing loyalty programs:

Key Strategies to Generate Loyalty

Delivering On Promises — Clients are often results-oriented and require you to fulfill your promises so they can meet their goals. If you’re falling short of your agreement, it doesn’t matter how much you wine-and-dine clients, they are going to search for someone that can get the job done efficiently and effectively. After all, business is business.

Host Executive Conferences — The average senior executive gives service providers a C+, according to a study by Ross McManus. Why? The most frequently cited complaint was service providers’ lack of understanding the client’s industry. If your team doesn’t fully understand the client’s industry, how can you facilitate their progress? To demonstrate your industry expertise and thought leadership, consider hosting client-only conferences wherein senior executives can learn about cutting-edge market trends.

Client Feedback Loop — There is always room for improvement. Gain customer feedback at the project close to see where your team and / or technology excels and falls short. Not only does client feedback help you elevate your product or service, it lets the client know you care about their opinion.

Offer Loyalty Incentives — At the end of the day, bootstrapping companies require competitive prices. To tie-in loyalty into prices, consider reducing prices over time. For instance, if your software service costs $10,000 annually, at year two, the price reduces 25 percent to $7,500, then another 25 percent at year three. A price-reduction strategy could help customers see the long-term benefits of brand loyalty.

Enthusiastic Brand Culture and Sales Force — “To truly build a solid core of loyal customers, a company needs the involvement of more than just marketing and sales,” writes Murphy. “It’s no coincidence that companies who have the most loyal customers, also have the best employees.” Indeed, an enthusiastic team suggests passion, drive and dedication to client success.

Outline the Benefits of Loyalty — Price chasers can spend more time searching for the lowest rate or learning the ins and outs of new providers than if they were to stay with your services. “After all, it’s easier to work with a known quantity than it is to hire someone new for every assignment,” writes the Wise Marketer. Sometimes all clients only see dollar signs, so point out the amount of time and energy it takes to switch providers.

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