LUCKY
BY DESIGN
NAVIGATING YOUR PATH TO SUCCESS
BETH GOLDSTEIN
© 2011 Beth Goldstein
All worksheets © Marketing Edge Consulting Group, LLC.
Cover Design by Becky Scroger, philoSophie’s® and inside graphic design by
Joanna Alberti, philoSophie’s®
All Rights Reserved.
No part of this publication may be reproduced, stored in a retrieval system, or
transmitted, in any form or by any means, electronic, mechanical, photocopying,
recording, or otherwise, without the written permission of the author.
This book is available at special quantity discounts to use as premiums and sales
promotions, or for use in corporate training programs. For more information,
please contact Marketing Edge Consulting Group via email:
luckybydesign@m-edge.com.com or call: 508.893.0976.
This edition published by
Dog Ear Publishing
4010 W. 86th Street, Ste H
Indianapolis, IN 46268
www.dogearpublishing.net
ISBN: 978-145750-806-6
This book is printed on acid-free paper.
Printed in the United States of America
LUCKY BY DESIGN │
CONTENTS
DEDICATION
vii
ACKNOWLEDGEMENTS
ix
PART I: OPPORTUNITIES AND OBSTACLES
1.
2.
3.
4.
5.
6.
7.
8.
9.
Introduction: What’s Luck Got To Do With It?
Designing Your Own Luck: An Eye for Opportunity
• Survey Highlights
Chance Favors The Prepared Mind
• Worksheet 2.1: Setting SMART Goals
Hope Is NOT A Strategy
• Worksheet 3.1: Translating Your Goals Into Reality
• Worksheet 3.2: Business Growth Scorecard
• Worksheet 3.3: Lucky By Design Roadmap
Opportunity Distraction Disorder (ODD) And The Perils Of
Not Being Focused
• View From the Trenches: Joanna Alberti,
philoSophie’s®
• Worksheet 4.1: Identifying the Right Opportunities
Is Business Success Like A Box Of Chocolates?
• Worksheet 5.1: Making Lemonade Out of Lemons
Would Your Business Take Home A Gold Medal?
• Worksheet 6.1: Going for the Gold
Deciding What You Want to Be When You Grow Up
• Worksheet 7.1: What Stage Is Your Business In?
Working ON Your Business, Not IN It
• View From the Trenches: Rob Olney, ETM
Manufacturing
• Worksheet 8.1: Working ON Your Business, Not
IN It
What If YOU Are The Reason Your Company's Growth Is
Stunted
• Worksheet 9.1: Letting Go to Grow
• Worksheet 9.2: Are You Getting In Your Own Way?
1
3
9
10
17
21
25
27
28
32
35
37
40
43
45
47
50
53
57
59
61
64
67
71
72
LUCKY BY DESIGN │ CONTENTS
10.
11.
What’s All This Talk About Innovation?
• View From the Trenches: Dr. Joe Jabre, TeleEMG
• Worksheet 10.1: Is Your Business Model Still
Relevant?
Breaking The Rules
• Worksheet 11.1: Finding Inner Genius
PART II: CREATING YOUR LUCKY BY DESIGN
ROADMAP
12.
13.
14.
15.
16.
17.
18.
19.
Your Lucky By Design Roadmap
Profile Your Customers
• Worksheet 12.1: Testing Your Customer Knowledge
• Worksheet 12.2: Data You Can’t Live Without
Do Your Homework
• Worksheet 13.1: Playing 20 Questions with Customers
The Customer’s Always Right – NOT!
• Worksheet 14.1: Customer Lifetime Value
• Worksheet 14.2: Selecting the Right Customer Mix
External Pulls and Pushes
• View From the Trenches: Ray Pinard,
48HourPrint.com
• Worksheet 15.1: Industry Research at Your Fingertips
Beauty And The Beast: Partnerships
• Worksheet 16.1: Getting Partnerships Right
Making The RIGHT Connections At The RIGHT Events!
• Worksheet 17.1: Making the Right Connections
Don't Let Your Brand Be A Lizard
• Expert Insight: Dale Bornstein, Ketchum
Communications
• Worksheet 18.1: Your Brand Value
• Expert Insight: Mark Lee, The LEE Group
• Worksheet 18.2: Test Your Brand Strength
• View From the Trenches: Kathleen McDonough,
Community Health Network
Don’t Throw The Baby Out With The Bathwater
• Expert Insight: Lisa Murray, Murray Whalen
Communications
75
76
82
85
88
91
93
95
97
100
103
108
111
114
115
119
121
124
127
130
131
137
143
146
147
148
151
153
157
160
CONTENTS │ LUCKY BY DESIGN
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
Why The Rules Of Old School Marketing Still Apply To New
Media
• Expert Insight: Gene Wright, University of Wisconsin
• Worksheet 20.1: Choose Your Tools Wisely
What’s The Next Marketing Holy Grail?
• Expert Insight: Sudha Jamthe, PayPal
• Worksheet 21.1: Online Networking Plan
Zen And The Art Of Presentation Mastery
Make Your Elevator Pitch Soar Out Of The Park
• Expert Insight: Paul Horn, Paul Horn & Associates
• Worksheet 23.1: Creating a Winning Elevator Pitch
Sales For Those Who Hate Selling
• Worksheet 24.1: Sales Preparations Checklist
Knowing When To Simply Let Go!
Tossing The Unlucky Coin – When Bad Luck Strikes
• View From the Trenches: Brian Moran, The Wall Street
Journal
• Worksheet 26.1: Business Contingency Plan
Cut Once, Measure Twice
• Worksheet 27.1: Measuring Your Input and Outcome
• Worksheet 27.2: Data Capture Plan
Your Lucky By Design Roadmap: Pulling It All
Together
Navigating Your Path
APPENDIX
Overview Of The “Role Of Luck” Survey
RESOURCES
Recommended Books And Articles
Small Business Growth & Innovation Tips Newsletter
INDEX
WORKSHEETS
All worksheets can be found online at
www.m-edge.com/luckyforms or by scanning the QR Code
165
168
171
173
180
182
185
189
191
193
197
204
207
211
212
215
217
218
220
223
227
229
229
235
235
236
237
CHAPTER
13 Do Your Homework
M
arket research is a valuable tool in not only identifying customer
satisfaction levels and needs, but it also allows you to better
recognize lucky opportunities by creating a clearer picture of
how your value proposition meets your customers’ needs. However, you
may be wondering how you can conduct market research on a limited
budget. With the power and tools available on the Internet, you don’t need
the budget of Apple or Pepsi to conduct market research. Research can be
conducted with very limited funds as long as you clearly identify the specific
information you need in order to make vital business decisions and design a
concrete roadmap to achieve these objectives.
Research Techniques
In my first book, I spend a lot of time going into detail about various
market research techniques available. You should reference that book for
more expanded information about market research since we will cover “just
the basics” here.
You may already be familiar with some of the research practices used by
marketers to understand and define their customers and prospects. These
include focus groups, surveys, concept testing, market analysis,
segmentation, and many others. All are time-tested ways of better
understanding your customers and your market opportunities. However,
when conducted by professional research firms, these techniques can be
quite expensive and can quickly drain an entrepreneur’s budget. Since many
managers assume that they must hire professionals to conduct these
activities in order to feel confident with the data, market research
techniques are sometimes overlooked or skipped entirely.
Turn Data Into Knowledge
In your Lucky By Design Roadmap you should have already defined
information that you need to know about your customers and/or
prospects. However, it is important to note that the essential element that
separates the successful companies from the struggling ones is their ability
to turn this information about customers’ needs into knowledge that can be
used to make sound business decisions. Information and knowledge are
vastly different. Simple facts alone cannot help you grow your business.
LUCKY BY DESIGN | 103
Creating Your Lucky by Design Roadmap
You need to turn those facts – the raw data – into knowledge by adding
your own analysis and research, and then use this knowledge to create value
for your business. If you cannot use the knowledge effectively, then
conducting the research is not worth your time and effort because it won’t
help your business grow. In fact, it might actually harm your business
because raw data used improperly can lead to very poor business decisions.
I say this not to discourage you from conducting research and creating
knowledge but to emphasize the importance of not merely conducting the
research but of also using the knowledge wisely to benefit your business.
Luck can happen to anyone. Even a blind squirrel finds a nut once in a
while." But don't bet the farm on good luck. Do your homework and be
prepared. Remember there is also bad luck. Have a contingency plan in
place so your business can respond when bad luck strikes... and it will,
most likely more than once.
Let me share one example of a client who used the research findings from a
survey we conducted to keep his firm in business. During the height of the
recession, a manufacturer whom I had worked with for several years was
gravely concerned that his prices were simply too high. He had drawn this
conclusion based on the fact that sales were down. He brought me in to
help him determine what his next steps should be to increase revenue (and
profit).
We began by launching a survey to his customer base. One of the most
important questions that we included in this brief survey was: “If you could
choose ONE factor only, what is most influential in your decision to
purchase our product?” Their options were (in this order):
• Price
• Product quality
• Customization of product
• Customer service
• Other (this was a fill in the blank).
The results will surprise you. Forty percent of his customers stated product
quality was their number ONE criteria for buying from him, 33% stated
customization of product and only 16% stated price. Let’s think about the
implications here.
104 | LUCKY BY DESIGN
Do Your Homework
Customers were clearly not using price as the primary factor in their
decision. They valued the high-quality product my client created and the
fact that the products could be customized. Quality and price are very
tightly integrated, especially in the markets they served (their customer list
included prestigious companies like NASA and Bose). We know that when
prices are cut there’s a typical assumption that quality has also decreased.
Therefore, if my client had cut his prices not only would he have lost profit
margin, but he would have harmed his reputation for offering a high quality
product. Given that customization and quality were significantly more
important than price, he proceeded to do the opposite of his original
intention… he actually raised his prices. In the end, he didn’t lose a single
customer and as he changed his message to focus more on quality and
customization, his business began to grow again.
My client used this as a valuable lesson in listening to his customers.
Although I do need to point out the fact that if there was a stronger
competitor in the market then raising his prices might not have been the
right answer. Therefore, it’s critical to understand the dynamics of the
marketplace. You must always be aware of what your competitors are doing
and how they might react to the actions you take because this impacts your
customers’ decision-making processes.
However, it is also important to note that that if my client had been in a
meeting with these customers, they almost certainly would have told him
price was a critical factor in the decision-making process. That’s part of the
negotiating process but NOT part of the research process. But because the
survey was anonymous and run by a third-party (in this case, me), the
answers we received were not part of a sales negotiation exchange. How’s
my client doing? He survived the downtown in the economy, raised his
prices (slightly), and his cash flow and balance sheet look much stronger
today because of a variety of important questions we asked his customers,
including the one factor that most influenced their decision to purchase
products from his company.
Ask the Right Questions
First, it’s critical that you don’t make decisions in a vacuum without clearly
asking customers and prospects what they value. In addition, you must
begin the process with a critical first step, which is figuring out what
knowledge you need to gain so that you ask the right questions. By having
a clear sense of the information you’re trying to obtain and phrasing your
questions specifically to elicit those data, you will avoid receiving
LUCKY BY DESIGN | 105
Creating Your Lucky by Design Roadmap
inconsistent or erroneous responses that could lead you to make disastrous
business decisions. This is true with every type of research that you
conduct, from running a phone survey and interviewing prospects, to
conducting online and offline written research. In fact, making a decision
based on gut instinct or no information at all could actually be less harmful
than making a decision based on inaccurate information. The reason is that
you probably wouldn’t realize that your information is based on false
assumptions and it’s more difficult to reassess your decision later on since
they are made with a false sense of confidence.
But this is not a reason to panic. The good news is that it isn’t that difficult
to ask the right questions. I share my client’s story to ensure that you
understand how vital it is to think about the knowledge that you are seeking
before you make any major business decisions that will dramatically change
the way you do business or your customers’ perception of your brand.
Begin with the end in mind and ask yourself, “What is the purpose of
obtaining this information?” and “How will I use the answer to improve my
business?” If you constantly ask those questions and can honestly provide a
response that makes logical business sense, then you’re heading in the right
direction.
Getting to Know Your Customers
There is some very basic data that you need to have if you are to
understand your customers, including demographic and psychographic
factors such as these:
Demographics. These are very factual and basic pieces of data that you
should already know such as:
• Age
• Gender
• Ethnicity
• Education
• Income
• Customer location
Psychographic and behavior influences. What behaviors or habits influence
the purchasing process, and who is involved in that process? These include
the information from the last chapter’s worksheet, Worksheet 12.2: Data
You Can’t Live Without:
106 | LUCKY BY DESIGN
Do Your Homework
•
•
•
•
•
Spending patterns/usage – examples include certain times of year that
influence customers’ spending patterns. When do your customers make
purchases, and what influences this pattern?
Price sensitivity – how much does price influence your customers’
decisions?
Pain points/challenges – what issues or problems challenge your
customers and influence their behavior? What is the one problem that
your customers have that you solve for them better than anyone else?
Lifestyle, interests, and attitudes – how does their attitude and the way
they choose to lead their life impact their decisions? For example, is
being green and environmentally conscientious important to them, and
does it impact their purchasing options?
Brand loyalty – are your customers more concerned about price, value,
reliability, or something entirely different, such as status or brand
appeal?
Remember, the specific data that you need are completely dependent on
your business and the customers that you require. Let’s briefly review
methods for gathering data.
Primary And Secondary Research
There are two basic types of data-gathering techniques: primary research
and secondary research. Primary research involves collecting original data,
data that you create yourself or that you obtain directly from the source
(i.e., your current and/or prospective customers, partners, or industry
experts). The advantage of conducting primary research is that it will give
you specific information related directly to your business and/or your
customers and not just general industry or target market data. This
information can be obtained by conducting surveys, interviews, or focus
groups, or by examining your internal database and uncovering clues about
your customers.
Secondary research, on the other hand, is one step removed from the direct
source. This involves uncovering clues about industry practices and norms
and gathering data about customers and the marketplace in general. The
word general is the key here, since these data may not be specific enough to
allow you to make any critical business decisions, or you may need to
confirm their relevance to your business. The sources of secondary
research, in most cases, are publications, documents (government and
nongovernment), newspapers, magazines, associations, journals, and
articles. This type of research might include government studies, chamber
LUCKY BY DESIGN | 107
Creating Your Lucky by Design Roadmap
of commerce statistics, surveys conducted by trade associations or industryaffiliated organizations, and rankings carried out by other reputable
organizations. Most of this data, if not all of it, is available online or at a
business library.
So how do you decide which type of research to conduct? Typically, you
will need to conduct both types. Of course, if you have an established
database of customers and prospects, then the task of obtaining specific
customer data will be easier, provided you have been collecting the right
information. If you haven’t been collecting valuable information, such as
how customers heard about your product, but have been gathering only
basic facts like addresses and phone numbers, then the most sophisticated
database system is not going to help you make any decisions. In addition, if
you are trying to understand trends in the industry or spending patterns that
influence your business, then you will definitely need to conduct secondary
research.
Worksheet Alert
Worksheet 13.1: Playing 20 Questions with Customers
To begin to really grasp the notion of conducting your own research, it’s
best to start with what you don’t know about your customers, but need to
know to grow your company. I recommend you compose a list of up to 20
questions that will help you define your customers. Imagine that you are in
a room with your top customers and you have the opportunity to ask them
anything you need to know about how they make purchasing decisions. Jot
down the knowledge that you need to obtain in the table located on the
worksheet, and then next to each entry, answer the following three
questions:
1. What is your goal in gathering this information (what will you do with
it), and how will the knowledge help your business grow?
2. What external/internal methods will you use to obtain the answer?
Methods could include survey, focus group, concept test, secondary
research, or market segmentation.
3. What are your sources of data? Sources can be an internal database,
external documents, or websites. If you cannot think of a good use for
108 | LUCKY BY DESIGN
Do Your Homework
the information or how you will obtain the answer, then cross the
question off your list. Otherwise, you’ll be wasting your time.
It’s important to review your roadmap to ensure that data collection and
research are part of your plan.
Finally, I’d like to provide you with a variety of ways that you can improve
your response rates while conducting a survey. There are many ways to
improve survey response rates and ensure that you are receiving accurate
information that is unbiased. As mentioned earlier, I review these methods
in much greater detail in my marketing book, The Ultimate Small Business
Marketing Toolkit. Below is a list of proven methods that work to get you the
data you need.
Boost Your Survey Response Rates
1. Keep it simple. Don’t confuse your respondents by asking them to do
anything other than complete the survey. This will dilute your message
and have a negative impact on your response rates.
2. Use clear and concise questions. Make sure that the survey is easy to
complete and understand. As with every marketing tool that you create,
it’s essential that you speak directly to your audience in an easily
understandable tone and style. The easier the survey is to complete, the
better the response rates will be.
3. Offer a gift or premium for participating. Make sure you’re offering
an item that will be an incentive to your target audience.
4. Assure confidentiality. This is essential. Respondents will be more
willing to share honest responses with you if you let them know that
what they say will be confidential.
5. Thank them. This basic lesson, which my parents taught me long ago,
applies to all business communications. Thanking respondents for their
time can only help to further promote your image as a company that
cares about its customers.
6. Tell them why. Why is it important for you to hear from your
audience? Why is it important to your customers to complete the
survey? If the survey results are going to help you make decisions that
will improve your customers’ lives or help you develop products that
are specifically designed to meet their needs, let them know that. They
can’t read your mind, so make sure they know why they’re spending
their time doing this for you.
7. Highlight what they will get for responding. It’s important that you
not only offer a gift but also clearly explain when, why, and how the
LUCKY BY DESIGN | 109
Creating Your Lucky by Design Roadmap
8.
9.
10.
11.
winning respondent will receive it, and then follow through on your
promises. For example, this can be a gift for all respondents, or for a
selected winner drawn from survey respondents.
Send your request from the highest or most appropriate level in
the organization. If receiving a letter from the company president or
customer service director will have a strong impact on response rates,
then use this strategy.
Include a space for comments. People may want to share additional
thoughts with you. You never know what other information the
respondents will want to tell you. I’ve seen these responses turn out to
be the most interesting data gathered from the survey because they’re
unsolicited and provide you with information that you might never
have thought of asking for. Customers can have the best suggestions
for products and sometimes advertising venues.
Allow them to respond in a variety of ways. Many times you are
tempted to request one method of communication, especially if you are
conducting an online survey and your database is set up to receive
information and sort it automatically. But the more options you can
offer for response, the higher your response rate will be.
Give them something unexpected. Under-promise and over-deliver
works in every venue of business life. If you promise them 10 methods
to increase response rates, then give them 11 ways!
We have now spent a good amount of time reviewing ways to uncover key
customer data and turn that data in knowledge that helps you navigate your
path to success. In the next chapter we will discuss how you assess if the
customers you have or are pursuing are actually the right ones for your
business.
110 | LUCKY BY DESIGN