The Gilman Company Blog

Got info?

You: Nothing says disenchantment quite like sitting across the table from a business person that didn't even bother to Google me or my company.

A deal breaking element of direct sales is information about your customer. A critical element of direct sales is personalization.

How do you achieve the type of personalization that comes with a sale? You learn about your customer. In that process of learning, you will begin to understand the qualities of your products or services that are most appealing to your customer. In that process, you will also learn about the needs of your customer. In that process, you will learn whether or not this customer will be a good one. You will learn how to improve your product or service. You will learn how not to waste your time.

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How not to pass your costs along

At the end of the day, you are passing along certain costs to your customers. There are many ways to pass these costs along.

When you are in a market where price is everything (wireless service, banking, etc.), a market where your product or service being 5% higher means you lose sales, you end up with things like hidden fees, watered down products and services, etc.

If you're not in that type of market, why would you ever consider inviting consumer angst with something like a "fee" or an additional cost when you can pass your cost along strategically?

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How to select the cost of an extended warranty

You've decided that an extended warranty is a great product to add to your catalog. Wonderful. Now, how do you decide the macroeconomics of an extended warranty?

Two issues here, perceived value and cost.

Perceived Value
One way to think about the pricing of an extended warranty is to understand what an extended warranty is to the consumer. What you're selling is a type of insurance on the consumer's investment in your product. So, how much would the average purchaser of your product be willing to pay to guarantee that product will be usable for a period of time which is longer than the basic manufacturer's warranty, say, one year from the date of purchase? Depending on the nature of the product, 10-20% of the advertised cost of a product could be a good place to start.

Cost
Along with perceived value, how much it will cost your company to make good on your extended warranty program will mean the difference between a successful program and a crashing business failure. Exploring an extended warranty program is a great way to reel in quality control issues and think about advancing design concepts that limit mechanical failure or wear and tear issues that may be characterized as mechanical failure.

Note: There are many pitfalls in the world of warranties. A good approach to a warranty program will require a thorough analysis of development costs, pricing, margins, customer service costs, logistics costs, customer satisfaction, distribution channels, sales channels and others issues.

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Technology in Your 2010 Strategic Plan: Quick Tip

It's that time again folks. If you're not already immersed in your 2010 strategic plan, it's still not too late to get started or to integrate a few overlooked elements.

Incidentally, The Gilman Company is offering a unique complimentary 2010 strategic plan to a limited number of companies who qualify. If you would like to learn more about a complimentary 2010 strategic plan for your company, please feel free to contact me.

If your fundamental approach to technology isn't in the strategic plan mix, well, it's just not done yet. Whether your a small service company or a large developer, technology in your strategic plan is a great way to sort out substantial cost savings, open new market segments or expand marketing in a cost effective way. Here, you can build on current technology resources or enhance them, close the doors on outdated and inefficient resources or earmark some budget dollars to develop a new approach.

Staff is a critical element of an effective technology plan. It could be training or talent acquisition. When you're looking at staff in terms of technology, a good balance of non-human technology resources and human resources is important if you want to leverage technology in the most effect way for your organization. There's little point in hiring a hot shot programmer if your software or hardware properties aren't up to par.

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Business Model Pressure: How to Adjust

In the past two years, countless small to mid-sized businesses (and many large businesses) have succumbed to the economic downturn. Call them what you like, failed businesses or failed business models.

At the end of the day, business models are now under a substantial amount of pressure. To continue growing it's certainly business as unusual. The challenge here is successfully adjusting a business model.

Consider a fundamental rethinking of value, not just to provide more value, but also to provide different types of value. To successfully adjust your business model, rethinking value won't be enough. You will have to take material steps to reorganize based on these new or added values.

Also, recognize that adjusting your business model will create volatility, so walk softly and plan transitional moves to reorganize that don't jeopardize the value you already have.

Get a Gilman consultation.

Doing Business with a Mass Market Retailer

Below is a short piece that I wrote for an online column earlier this week. Just a few tips and thoughts for growing companies on doing business with a mass market retailer.

Getting your product on the shelves of a large, mass market retailer, such as Wal-Mart, Target, or any other large retailer is no small task. It is certainly possible, but business owners can expect large retailers to turn the screws on any standard product distribution model and stretch product distributors, manufacturers and brand owners to new extremes.

One thing I have learned in dealing with companies like Wal-Mart is that having a product on Wal-Mart shelves is not for everyone. Doing business with a large retailer could change your entire business model and your approach to product development and product and brand integrity. Depending on what your objectives are, it could be a change for the better or for the worse. You'll have to decide if that's the type of change you're willing to go through. You will also have to be much more in tune with your production model, as you will need to squeeze every tenth of a cent out of your production costs while maintaining a mandated level of quality in order for any transaction to be profitable.

If you haven't already, you will also have to design a new segment of your business that addresses the all-new problem of a substantial increases of returned products. In order to build goodwill with shoppers, mass market retailers have especially liberal return policies, which distribution, manufacturing or product development companies need to foot the bill for.

Finally, macroeconomics will be especially important to your efforts in working with a mass market retailer. Here, unless you're working with a well-known brand, your company will be operating an margins that are thinner than a razor, so you'll have to audit every cost imaginable in doing business with a mass market retailer to insure that you can turn a profit, including costs like customer service, returns, production, packaging, logistics, etc.

These are just a few of many general issues your company will have to face in a deal with a mass market retailer like Wal-Mart. Working with mass market retailers can be especially rewarding, but that reward doesn't come without a cost. Do a lot of research. When your done with the research, do more research. Then start with a simple cost/benefit analysis and make an informed decision on whether working with a mass market retailer is the right choice for your company.

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The Technorati Claim Post

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Looking for Dumb People?

Is there money to made by marketing services to people who don't know any better? Certainly!

There are countless examples of services that no one needs, but that customers line up to pay for. In fact, many of these services make realizing the desired outcome more difficult (not to mention more expensive). So, how do you sell something that no one needs or necessarily wants? Focus on a false sense of fear and offer to "handle everything."

The anecdote: A notice from Company X, which I have never heard of, explaining my obligation to update a legitimate administrative legal matter. Clearly, my time had come. I paraphrase: "So many horrible things can happen to you if you don't address this matter. Luckily, we can handle everything for you. Just pay X to us and we'll take care of it."

There's nothing exciting, inspiring or genuinely likable about a business model that relies on ignorance.

The Communications Audit: How to Get Started

This is not the post about the importance of branding. You're beyond that. This one is the post about getting started with one of the most important elements of branding: your front-line communications.

"Audit" in this context is just another way of saying that you're going to take a close look at an element of your operations with an eye toward improvement. One of the first material steps you can take to effectively enhance how your customers perceive your company is conducting a communications audit.

Get everything together. Everything. Brochures, websites, email templates, text content, magazines, the products, press releases, business cards, signage, ads, the music that plays when your customers are on hold, anything that the world perceives your product or service through. If it's not already, get it all on paper.

Once you have everything together, scan through all of it quickly. Is there cohesion or chaos? Does the look, feel and tone of your communications represent the unified vision, goals and fundamental objectives of your organization or are you sending mixed signals to your customers?

Not concerned about cohesion in communications? Without it, your customers may never experience, understand or recognize the core values of your organization and brand, and brand recognition is why your customers will be loyal, why your customers will pay a premium for your product or service. Whether you're a local printer or a national brand, you can leverage the value of a communications audit followed by an organized effort to improve.

Get a Gilman consultation.

Why I Like Apple, Even if Begrudgingly

Apple experience 1: The second generation iPod, my first Apple, changed the way I relate to music on a fundamental level. Back then, the iPod was a brick and the user interface wasn't color. But it gave me an experience with music that, up to that point, I didn't think possible. Since then, the iPod and iTunes haven't improved much beyond more storage software whistles and bells. Either way, I still can't imagine another device playing a larger role in the way I relate to music.

Apple experience 2: After several generations of iPods, yep, the second generation iPhone. This mobile device changed the way I relate to mobile communication from the ground up and, honestly, the telephonic abilities of this device is the least interesting thing about it.

Yet, I, like legions of other computer users, am faced with the need of a new computer from time to time, a desktop or a laptop. The problem for Apple: I'm good at keeping a PC in good shape, I'm fine with point and shoot images that are 90% there and I'm not in the recording business. Here, an Apple computer will not change my life anymore than switching to a Zoon would.

A little bit "first in time" or a little unparalleled innovation can last a lifetime.

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