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How HELPING Sets You Apart from the Competition

Several weeks back I talked about how the secret to social media success was CARING. Today, I want to share a story that illustrates this point. It comes from a successful entrepreneur who used it in the offline world, and it’s all so simple that it’s genius…

Todd Smith was recently interviewed on Mixergy.com, explaining his career. One story that really stuck out was how he succeeded in selling real estate.

Todd was a licensed realtor working at a well-established real estate agency. He was young, and needed to find houses to sell. To get listings, he focused his efforts on people who were determined to sell their own homes. These are called “For Sale By Owner” or FSBO homes.

Now, many realtors target FSBOs, cold calling again and again, trying to convince the owners to list their home with a realtor, instead of going off on their own.

But Todd did something different.

On the first day a homeowner listed their own house for sale without a realtor, Todd would give them a call. But instead of pounding them with a sales pitch, he offered to help. He would tell them that he wants to help them with their goal of selling their house without a realtor.

He offered them a thick ‘sales kit,’ which included a ton of information on how a homeowner can sell their own home. There were marketing tips, negotiation tips, sample contracts, etc.

But that wasn’t all. He told them that if they did receive an offer, he would gladly come over and write up the contract for free. To top it off – he would even give them “for sale by owner” signs to put out in their yard.

So what was in it for Todd? Three things:

He was competing with other realtors to woo homeowners to list their houses with an agency. By helping homeowners with their goals, he stood out from the crowd.
He didn’t pitch homeowners to list their houses with him, he instead asked for a referral if anyone they knew ever wanted to list their house with a realtor.
Many homeowners fail at seller their own homes, and when they consider listing with a realtor – Todd would be their first choice since he was so familiar and so helpful.

You can listen to Todd tell this story in his own words at around minute 21:45 of this interview. What was the result of his efforts? He was voted into RE/MAX’s Hall of Fame at age 28.

So what can we learn from Todd’s experience? A few things:

He was different because he helped.
He put the needs and desires of others first.
He offered to help before anyone else, uncovering opportunity.
He built trust that might not pay off until much later, if ever.

Most people are not willing to do what it takes to be successful. They take the quickest line to their goal, and disregard anyone who doesn’t serve THEIR needs at the moment they want them to.

Todd took a different route. One that helped.

Thanks!

-Dan

Copying All the Wrong Things

Many businesses are established because they find an idea that has taken hold in our culture, and want a piece of that pie. So if Starbucks can earn billions each quarter, what you often find is smaller upstarts vying to capture 1% of that market.

You saw this when Google became a juggernaut, with new search engines launching with the idea that if they could generate even 3% of Google’s traffic, then they would all be rich.

A few weeks back I wrote about what made one Starbucks shop exceptional, how it adapted to a situation to better serve customers.

This left me considering how many people look to emulate Starbucks, and whether or not they are finding value in doing so.

I frequent quite a few coffee shops, and by and large, I see many of them copying all the wrong things from Starbucks.

I am thinking of two easy examples, which I won’t name, but one is near where I live in New Jersey and the other is in Manhattan. Generally, this is my experience with these stores:

They look just like Starbucks. The layout of the stores, the items they sell along the wall, the lighting, the decorating and the overall ‘look and feel.’
The products strive to be familiar copies of what Starbucks sells. The goal seems to be to ride the coattails of Starbucks, to leverage Starbucks’ huge ad budgets. So the beverage selection is a near direct copy of what Starbucks offers. Nothing unique, unless they tweak their version of a Vivanno to include guava instead of strawberry.
The processes are exactly the same: from ordering to the beverage delivery process. Again – this is likely to leverage the money Starbucks spent on research & development, and to provide customers with a familiar experience. The issue here is that there are some things that work about this process, and others that don’t, from a customer perspective. From a process perspective, you will notice that Starbucks has a system of how their employees communicate to work quickly and efficiently, with a goal of reducing mistakes by repeating drink orders twice. I rarely see this process emulated at other coffee shops, even if the setup looks similar to Starbucks.
Employee training seems to be a top priority at Starbucks, and minimal at other coffee shops. I have sat next to people being interviewed for a job at Starbucks, and its a very detailed interview – it is clear that the manager is looking for someone who has the right attitude and whose life is setup to commit themselves to making Starbucks a core part of their world.Employees are always friendly, and do their best to create a pleasant coffee shop experience – it is clear that they are trained to give you the feel of being a friendly local coffee shop.Many of the other coffee shops I go to have adequately trained their employees on the cash register and on making drinks, but beyond that, each employee brings his or her own work ethic and personality. And while I like to think this would be a positive thing, it often isn’t. Perhaps they great you with a huge hello as they were told to, but beyond that they barely look at you, are more engaged in conversation with co-workers, or spend more effort restocking cups than serving the customer right in front of them. When you couple this with the amount of time I get the wrong order at some of these places, it makes for a mediocre experience at best. Kind of like getting gas or checking out at the foodstore. It gets the job done, and that is all.

And this is where it all falls apart: I am left with an experience that looks and feels like Starbucks, but minus the soul – minus the little things that their employees and overall brand delivers that creates unique value and a pleasant experience.

The funny thing is, I am not really a huge fan of Starbucks. But I do appreciate their employee’s attitudes and I do appreciate the free wi-fi and their support of the concept of ‘the third place,’ a place that you can relax at that is between work and home.

In your business, be it online or in person, when you look to a successful company as your model for growth, consider if you are copying the right elements. Are you wrapping a lump of coal to make it look like a successful product, or are you delivering core value: something unique, something valuable and something that will stand out to your customers, leaving them with smiles on their faces.

Bringing a Brick & Mortar Business Online: Next Level Guitar Case Study

Today, I want to profile how an a formerly brick and mortar business of private guitar instruction has translated into a revenue generating online business with thousands of customers. Included are key takeaways for business owners in other markets.

Years ago I noodled around with the guitar, making loud sounds, but never properly learning technique. Recently I began learning how to play guitar, and was amazed at how different the process is today than it was 20 years ago.

The Old Way

For years, private guitar instruction was offered through a local music store or from an independent instructor. Today, this would cost between $20-30 per half hour session. With that model, here are some things required from the service provider:

You may need to own a storefront.
To balance cost vs revenue, you will likely need to sell products that bring in customers and create new ones. This creates overhead, inventory capital & management expenses and perhaps the hiring of employees.
Likely, paid advertising in local media outlets such as newspapers or cable TV would be requires, or perhaps sponsoring the local little league team or donating instruments to the elementary school band.
Your potential client base is limited by the region you serve. To grow, you need to spend more time convincing people to play an instrument, or open up branches in neighboring towns.
Every dollar you earn, is a dollar that you need to work for, or pay an employee to work. As you scale, you must scale the amount of money you put into the business and the amount of work it takes to coordinate.
If a competitor opens up in town – especially a big chain like Sam Ash or Guitar Center, you could loose a sizable chunk of your business.

From the perspective of the student, there are requirements as well:

You need to live within proximity of the instructor.
Your choice of instructors is limited – you must choose someone who is close and affordable, but this might not be someone that resonates with your personality & musical style preference, or that teaches in a way that works best for you.
You need to account for the travel time & expense to get to each lesson.
You must schedule classes within the hours that the store offers lessons
You pay each half hour you are taught. Even at a half hour a week, this could be $100 per month.

Clearly, the old way still works. This article is not trying to do away with the old model, I am simply illustrating how it can be a single part of a larger – and more profitable – system.

The New Way

Guitar Lessons on the Web

When picking up the guitar again, I first considered following that first path – finding a local instructor in order to learn the guitar. But then, I quickly realized how highly evolved the online courses have become.

My first stop was YouTube, and I typed in something simple like “Guitar Lessons.” 433,000 results. Wow. So I started clicking on some of the videos, and found them really clear and useful. I also liked how many of the instructors were regular people like me – not some slick professional production that made me feel removed from my distant goal.

I began refining my search, using different search queries. Within an hour, I had found some instructors that I liked, and some I didn’t. It wasn’t a scientific process, I went on my gut feeling.

I had a wide range choices in instructor personality, lesson types, music types, etc. To do a comparable comparison where I live, with an in-person instructor, would have taken a lot of time, effort and money.

I began noticing that some instructors were just folks who created a few videos in their spare time as a hobby, some had created a series, and others had created many videos that were clearly part of a professional instruction course. I sampled widely here for a few days, trying out lessons from many different people.

Once I decided that I wanted to take this seriously, I began focusing on those who offered a more comprehensive program. Clearly, I preferred free lessons, and sought those out first. They were good, but oftentimes didn’t provide a 100% clear path from beginner to master. So, I began looking at paid courses.

There are many online guitar courses, I want to dive deep into the one I selected. This does not mean it’s the best – there are many other great courses out there, the one I chose simply caught my eye, resonated with in terms of style and personality, and got me to give them my credit card number. That says something.

Case Study: Earning Money Online

Some of my favorite free courses on YouTube were by David Taub, whose YouTube channel is called “rockongoodpeople.” Here are a couple sample video lessons:

It’s not long before you realize he offers a paid service though his website NextLevelGuitar.com. Here are the basics of his business model (as far as I can tell):

Create educational videos.
Share these videos on popular channels such as YouTube. (note: YouTube is the world’s second largest search engine!)
Give it away for free.
Upsell to paid products that offer more structure, more customization, or completeness. They do so by directing potential customers to NextLevelGuitar.com on their videos. Their paid products include a monthly subscription to video lessons on their website or DVD’s of the lessons.
Establish a relationship with current fans and find new ones by constantly creating and sharing new videos and educational materials.
Strategically create and optimize these videos based on popular search queries – things people want to see.
Create a forum to further engage fans and students.
He still keeps his in-person one-on-one guitar lessons going.

Let’s model out a VERY conservative look at what Next Level Guitar could be earning from these efforts. They recorded about 700 videos, and I believe they did so in their home with a regular consumer video camera and other supplies. On the low end, this is what they could be earning: $250,000 per year. Let’s break it down:

$237,000 per year in monthly subscription revenue. 660 premium users were online the other night, so I just multiplied that out by $30 per month, which is what they charge. Likely, their active subscriber base is more than 660 folks, but I’m working with what I know.
$20,000 per year in DVD’s. This is assuming that they sell just 20 DVD packages per month at varying price points.

It should be noted that Next Level Guitar consists of only two people as far as I can tell. Likely, you can easily double or triple the amounts listed above and reasonably expect it to be more accurate. That’s about $500,000 – $750,000 per year. Keep in mind that much of this isPASSIVE income. They don’t have to sit there each day and teach you guitar, the 700 videos do that over and over again. This is what allows him to continue his in-person lessons.

So what are the benefits of a system like this? Here are some lessons that could help any brick and mortar business build their brand (and revenue streams) online:

Credibility
This all started with David providing lessons locally in the traditional manner. Clearly, he is talented and a great instructor. When he moved that online, his online courses have given him national exposure and a brand that he can leverage to sustain his original business of working with students in person, and build new opportunities to expand his international brand.
Word of Mouth Marketing
The web is inherently social, and when your business and products are there, online word of mouth becomes very powerful. Likewise, there are many music blogs, forums and websites that review Next Level Guitar and discuss the pros and cons.
Free Advertising
When you search on ‘Next Level Guitar’ within Google, you get page after page of results. This is all free advertising, and not just within Google; these results are comprised of mentions from across the web. These organic search results are free. The larger goal however, is to rank well for search queries such as ‘online guitar lesson.’
Affiliate Programs
Next Level Guitar offers an affiliate program whereby those who refer new customers get a portion of the sale. So these partners only get paid when you do – there are no upfront costs.
Inexpensive Targeted Advertising
I am not sure if they use either of these options, but if they wanted to pursue more traditional display advertising, they could do so very cheaply on Facebook or through Google adwords. Can start with very small budget – even $5, and target it by demographic on Facebook or by search query on Google.
Creating a Product, Not Just Selling Expertise
Creating a paid online course allowed David to scale his efforts. When he created his system, he put on his entrepreneur hat, which is a level above just putting up a flyer at his local foodstore advertising guitar lessons. Likewise, he opened himself up to have his product reviewed on the web and in national publications.
Passive Income
With the online subscription program and DVD’s, David has created a passive revenue stream. He can take a month off of teaching in person, and still be generating revenue from these products with little effort on his part. He created once and is selling many times. It also gives him the choice as to whether or not he NEEDS to continue trading his time for money via half hour in-person lessons. It becomes a choice, not a requirement.
Opportunity for Expansion
More recently, you are seeing David feature other instructors on his YouTube channel. He is giving others the opportunity for exposure through his well known brand, and in return, posting more highly useful content on his website. This allows his channel to capture more search queries from those searching on YouTube, and helps engage more people who may connect with different instructors and teaching styles. So now David can concentrate on other things when others are filling up his channel with premium content. Win-win-win.
Contests
I don’t think I have seen Next Level Guitar doing this yet, but when you build an online fan base and people are talking about you in forums, it is a ripe opportunity to further engage them with contests. Perhaps he could give away DVD sets to people who upload videos of themselves playing a certain style or song. This gets people talking and makes them take an additional effort to be involved in your brand. This is priceless in a crowded marketplace.
Avoid the High Costs of a Brick & Mortar Business
Before the internet, if David wanted to grow his in-person guitar instruction business, likely he would have opened up a physical studio. Since he has been able to expand on the web, he is less reliant on the high cost operation of owning a store front and on using traditional advertising. This gives him personal freedom as to where he lives and how he spends his time. He could move to Japan, and yet his online reputation and online products would follow him without a hitch.
Scale is Unlimited
If David had opened a physical storefront, his revenue stream would be limited by the population size in his area. But online, he gets a constant stream of new business, as his market is a worldwide audience.
Partnerships and New Product Launches
The Next Level Guitar website offers a free eBook on their homepage, which requires you to share your name and email address in order to download. Between this and their past and present members, they must have thousands and thousands of names on their email list. If they ever decide to sell branded stress balls to build muscles in your hand or partner with Fender to offer Next Level Guitar guitar picks, they have a powerful tool to launch these items via an email promotion.

Can your business scale on the web in ways similar to Next Level Guitar? Sign up for my weekly newsletter (via the form below) to read more case studies about building your brand online. Or, feel free to reach out to me if you have any questions about moving your business online: dan@wegrowmedia.com.

(note: I have no connection to or affiliate relationship ship with Next Level Guitar, I just happen to use their service to learn how to play guitar.)

How Saddleback Leather is Building Their Brand Online

How does a small company that makes leather bags create online buzz about their product leveraging free social media tools? Today, we are going to take an in-depth look at Saddleback Leather.

Now, for the most part, this encapsulates their online presence:

But that doesn’t really tell the story how the web & social media has effected their business. These experiences tell the story better:

3,028 Fans on Facebook who have uploaded 350 photos of themselves with Saddleback Leather’s bags.
Chris Brogan reviews a Saddleback bag, as did others on YouTube. Considering he has a successful speaking career and more than 100,000 followers on Twitter, sending him or others a bag or two for review is not a bad investment. It’s clear that Saddleback sent some of these out as review samples, but I am not positive which online reviewers purchased bags vs receiving free samples. His video review alone has been viewed more than 3,000 times, and others have been view about the same amount. Imagine thousands of people watching reviews of your products or services on a site you don’t own or maintain.
Jason Fried ordered a bag and told people how impressed he is with it. Jason is well known, with 23,000+ followers on Twitter reading his messages.
Elsewhere on the web, there are some very detailed online reviews (some with affiliate links) that receive more than 40 comments from readers. Here is another.
People are talking about Saddleback Leather in forums, questioning their claims of quality and looking for advice from those who have experience with their products.

I had the chance to speak with Saddleback Leather’s founder Dave Munson who shared details on how his business formed and his learning curve in online media. Below are some lessons that I think many businesses can take away from Saddleback Leather’s experiences.

As others before me (here and here) have pointed out, Saddleback’s website is masterful in its use of storytelling to explain their brand, the quality of their products, and its benefits for the customer.

Their website shares details about Dave’s colorful life, his passions, his odd experiences, and focuses on his family and beloved (but departed) dog Blue. Check out their “Our Story” page for an example of Dave’s storytelling skills. This is clearly not Samsonite.

What does the Saddleback brand represent? After studying it, I would say two things:

Quality
Identity

The message of quality is so overt on their website that he shares links to his competitors, daring you to compare. In terms of identity, again and again, Dave mentioned how his customers tell him how their bag got them noticed, and provided something of an identity. As you browse SaddlebackLeather.com or the many offshoots of it elsewhere on the web, you see the same messages repeated over and over in different ways.

One of the many identities Saddleback tries to convey is adventure. And this is evident in the many photos they post and that their customers share.

Dave’s business evolved slowly, selling his first bags on eBay in 2003, forming the business in 2004, naming it & launching the website in 2005, and getting a working ecommerce system on the site in 2006.

At each step, Dave mentions friends or friends of friends who helped along the way and became a part of the Saddleback family. Business advisors, marketing advisors, website developers, all were found through people he knew, and each are still a part of his business.

Outside of the company’s doors, it is clear that word of mouth marketing is what Saddleback is all about. As Dave said:

“If people are happy, they talk about it. Now people talk online.”

To help fan the flames, Saddleback has photo contests, gives away bags, and encourages feedback. These outlets also allow people to be involved with the brand, before they shell out $500 on a bag.

Dave says he does not want Saddleback to become a huge brand. He doesn’t want the bags in big retail chains, and limits his paid advertising to banner ads on niche sites, Google adwords, and potentially ads in niche magazines. Saddleback is targeted to a very specific audience, and Dave is okay if that is polarizing.

He says that mainstream is not the goal. One indication of this is Saddleback’s tagline:

“They’ll fight over it when you’re dead.”

An experienced marketing advisor told Dave to avoid using the word ‘death’ in a tagline, advice that Dave ignored. Following all the old rules may be ‘safe,’ but exposes a brand to mediocrity. As Dave said:

“People are tired of Fake. They want real.”

Businesses: Get Serious About Building Your Brand Online

At their best, businesses are a mix of courage, inspiration and practicality, resulting in the creation of something unique, something needed, and something that puts smiles on people’s faces. At their worst, businesses exploit customer needs with inferior products and ruthless practices, skimming off “value” that rewards the few, while depleting the resources of the many.

When considering ways to grow your business online, you are left with two choices:

Leverage new tools to enable customers to meet core needs.
Spam as many people as possible with the hopes that X% of them will click on an ad or buy your product/service.

Today, let’s focus on how an established business can begin thinking about the web and social media in ways that can enable the goals of their customers, and establish your own brand as a powerful presence online.

Common Needs

Every time I walk into a coffee shop, a dry cleaner, a local franchise, or drive by a strip mall or office building, I consider the needs of these businesses. Regardless of their makeup, their market or their history, most have similar needs & purpose:

Find new customers
Grow the value of their existing customer base
Identify even greater efficiency
Explore new market opportunities

And I understand why these businesses are more concerned with the customers walking by their storefront than those doing a web search for “Coffee, Madison, NJ” in Google Maps.

But that doesn’t mean that an opportunity to serve customers and expand your business does not exist online. The sooner a business realizes this and begins taking small steps, the sooner they will realize the fruits of their labor, and get a step ahead of their competition.

New Audience Behavior Within a New Competitive Landscape

Whether you know it or not, the behavior of your customers is changing:

How they find businesses.
How they research and judge products.
How they manage their personal and business finances.

Each of these processes is moving online. If you are waiting for them to tell you this, then you will be acknowledging this shift too late.

Likewise, there is a new competitive landscape – a fight to engage with your market online, to serve their needs in integrated and easy ways. Will you wait and wait until these changes are so solidified that you feel it is “safe” to make a move, long after others have finished the land rush and worked to establish relationships in the lives of your customers?

Focusing on the Right Opportunities

So why aren’t more small and medium sized businesses jumping into the online space to build their brands, engage customers and edge out the competition? And for those who are, why do many of them devote so few resources and execute so poorly? Well, for most business owners or managers, their days are filled with execution – trying desperately to keep up with the many processes and opportunities that they feel will lead to immediate business growth.

While this thinking can take many forms, I can understand why some tactics give the illusion of immediacy: that handing out flyers on the corner 50 feet away from our door would be time better spent than learning about search engine marketing.

It could be argued that this responsibility falls to a sales or marketing manager, assuming the business is large enough to have these roles. The issue becomes this: in all likelihood, the existing business structure rewards old behavior and meeting old needs, and is unsure of how to value new processes, new customer behavior and new sales channels.

We Grow Media: Helping Businesses Build Their Online Brand

I am launching We Grow Media to help businesses realize business growth through online media and marketing. My goal is to offer practical ideas and strategies that a busy manager can implement in small and meaningful ways within their organization.

You can expect a couple new blog posts here each week, but the best way to stay on top of the latest tips and case studies is to subscribe to the We Grow Media weekly email newsletter: