Build Your Business, Not Your Product

I’ve had a copy of The E-Myth Revisited floating around my house for years, picked up at Half Priced Books a while back and forgotten as I read through The 4-Hour Workweek, Crush It, The Dream and, most recently, Rework.  A friend reminded me of the book again last week so I sat down in the sun yesterday and cracked it open.  I skimmed through the first few chapters, reminding myself of the writing style and key concepts that being a business owner is not the same as being a working in your business.  The technician in you wants to work on your product, the manager wants to work on the people and process, but the entrepreneur needs to work on the business.

Photo courtesy of ihtatho via Flickr

The subtext of the book is that it reveals the secret as to why two thirds of small businesses fail in America.  I haven’t finished it yet, but midway through the book, I was struck by the concept of franchising and how its a valuable model to follow for any business, even if you don’t intend to actually turn your business into a franchise.

The argument for following the franchise model is that it forces you to focus on your business.  Your product is a commodity, your business is where the value is. It is likely that anyone can create your widget if given the focus and tools, but to replicate your business structure, processes, character and consistency is where the magic happens, and the book stresses that consistency is the key to business success. 

Build a business that doesn’t rely on hiring exceptional employees.  Requiring exceptional employees leads to scalability problems as you expand and find that the caliber of employee you rely on isn’t an option in many parts of the country or world.  The key to being able to hire ordinary employees and still achieve extraordinary results lies in the process.  Build a process that is fool proof.  Anyone can execute a well defined list of instructions and achieve similar or exact results.  If you can mechanize or automate it with software, you’ve removed that variable entirely. 

The aspect I was troubled by, which the book later addressed head-on, was employee satisfaction.  If your tasks only require low-skilled workers, how do your great employees feel motivated to grow and improve? The answer that I pulled from the book was to shift their focus as well.  Instead of your employee feeling like their job is to create widgets, make them feel as though their job is to improve the process of making widgets.  If your employees focus on improving the process and protocol that they use to do their job each day, they can see that improvements to the process increase their own efficiency.  Increases in efficiency driven by employees will motivate the employee and lead to higher margins and better quality for the product and company.

Business owners: Are you encouraging your employees to focus on your product or focus on your process?  If they did focus on your process, do you feel that it’d improve long term profitability and efficiencies for your company?  I’d love to hear your thoughts.

The book is E-Myth Revisited and you can purchase from Amazon here.

Great resource for internet business entrepreneur interviews

I’ve run across several links recently to a site called mixergy that interviews web entrepreneurs about how they got started in thier businesses, how they’re doing today and their plans for the future.  Its a great resource if you’re looking for inspiration, a few war stories and the nitty gritty on what it takes to get started and run a profitable internet business.  All the videos are completely free to watch and most are 10+ minutes, much more than just sound bytes.  Check it out

Come back here and leave a comment with your favorite interviews.  So far I’ve watched: Anand Shimpi, Neil Patel, Alex Algard and Jason Calacanis.  Next up? Seth Godin, Tim Ferris and Gary Vaynerchuk.

Small Business Owners – 3 Steps To Building An Online Presence

I’ve been giving a lot of thought over the last few months to trying to establish a system to help small businesses build up a presence online.  Now, as the economy tightens up, its more important than ever for small businesses to leverage every means available to attract new customers.  Over the last 8 months, I’ve been helping a law firm build out their web site to pull in customers through both PPC ads and natural search ads.  In addition, I’ve had a few of my own projects kicking around that I’ve been experimenting with on and off.  The outcome of these projects leaves me with the strong belief that any small business can benefit greatly from having a presence online, especially those with a local service or unique product to offer.

Now I’m looking for a new project.  My thought is, since I already have a full time job, I’ll offer to work solely on commission.  I’m confident, through my experiments so far, that I can make a measurable difference to a small business that is looking to start out online.  The approach I’ve found works best is to focus on building out a simple site with the main concept of what you are looking for, turn on pay per click ads to measure user interest, then work to develop a long term strategy for attracting visitors be it paid search, natural search or community posting.  Here is a basic outline of my three part approach for building an initial online presence for small businesses.

Start out simple

Building out a website can be incredibly time consuming, with the intial phases seeming the most daunting.  Coming up with unique content, a solid layout and proper messaging can take a very long time, especially if the developer is working part time and the business owner has strong feelings about the messaging and image they want to portray on the site.  My recommendation is to build something simple to get it up and running quickly.  If both the developer and business owner understand the primary focus is on simplicity and time-to-market, they will be much more open to flexibility with an understanding that the details will be worked out and finalized in future iterations of the site.

Pay Per Click Is Your Friend

Start pay per click campaigns through Yahoo or Google as soon as the initial site is up and running.  Once you build the simple site, you will soon find that you have little to no traffic coming to the site.  Google alone may take several weeks to index your site and, even then, its unlikely you’ll rank well for any common terms if you are in a competitive market.  There are likely to be many other larger, more well established competitors already in the market.  Use pay per click campaigns to test out the competition and learn about the market as quickly as possible.  An investment of a few hundred dollars will allow you to learn some great details about your market in as little as a few days.  The key questions that will be answered by a small investment in pay per click ads are:

  1. What is the cost per click to advertise in the space?
  2. What percentage of visitors to the site are potential customers (inquire about the product, fill out a lead form, etc)?
  3. What types of search terms are people using to find your site?
  4. What sort of demand is there for your key products and search terms?

Once you have some basic data from the paid campaigns, you’ll be able to develop a picture of what the competitive landscape is and what your strategy should be moving forward. 

For the law firm I’ve been working with, by experimenting with pay per click ads we found it would take about $25 to get a lead through pay per click ads for the type of law they specialized in.  By honing the PPC campaigns over time, we were able to get that down to about $22/lead, but the point is that we were in the right ballpark after a few weeks, knowing roughly what it would cost to attain clients through the PPC approach.

Developing A Long Term Strategy

Once you have a basic website up and have gone through the pay per click research phase, you are at a decision point.  Based on the data you have so far, you should have a rough idea of whether or not further investment in your online presence is worth it.  If you find that it takes $10 in pay per click ads to sell a $5 widget, you’ll understand that you either need to significantly change your cost structure or find a new way to market your product.  My hope is, after the basic build out of the site and the initial experiments with pay per click, you’ll see there is a benefit to your new online presence.  If you see potential, then there are a number of next steps to take in building your presence.

My specialty is in building out natural search rankings for clients.  Depending on your product, I try to find a logical way to build out hundreds or thousands of pages about your product or service.  If you sell 10 different widgets, I’ll build a system to create a seperate page for each widget, a seperate page for each color of widget, and a seperate page for each size of each color of each widget.  The point of these pages isn’t to delight customers in being able to narrow down to exactly what they are looking for, they can do that on their own, the point is to signal to search engines that you are a premier widget shop.  You have lots of widget models, lots of widget colors and lots of widget sizes.  As a small business owner, you may never rank for a basic search like ‘cheap widgets’ (and you may not want to), but if painted, wooden widgets are your specialty, you should show up in the search engine results for terms like ‘yellow cedar widgets’ and my page bulk approach will get you there. 

I hope you enjoyed reading my recommended approach to building an online presence for your small business.  If you have any questions or need a hand with your efforts, leave a comment and I’ll get back to you as soon as I can.  If you would like to try taking your small business online but would rather focus on running your business instead of dealing with the technology aspect, drop me a line and lets see if we can work something out.  I’m looking forward to exciting new projects and am confident you can benefit from this simple, straight forward approach to building your small business presence online.