You Never Know Where the Next Best Idea is Going to Come From

27 June 2009 Categories: Networking, Success

Dollarbillorigami2 In Search of New Sources of Revenue

Like many of you, I am working harder than ever to maintain the level of business this year versus last. As I work on the core of my business – consulting, training, writing books, etc. – I am always searching for new revenue streams.  Who isn’t looking to make more money?  

My search led me to look into the field of direct selling. I know what you’re thinking: "What’s Lis gone off and done now?"  Hear me out.  

Direct selling, also known as multilevel marketing (MLM), is sometimes confused with what people call "pyramid schemes." According to my research, although seemingly the same, direct selling and pyramid schemes are very different.  By definition pyramid schemes rarely involve a product of value. The income from a pyramid scheme comes primarily from the recruiting of other associates.   On the other hand, multi-level marketing is a marketing strategy that compensates promoters not only for product sales they personally generate, but also for the sales of others they introduced to the company. With multilevel marketing, you can continue to make money by selling the product even if you never recruit another person.

The products and company are usually marketed directly to consumers and potential business partners by means of relationship referrals and word of mouth marketing, basically another form of retail marketing. In a 2007 Wall Street Journal interview, economist Peter Vander Nat stated, "If people are buying because they want to use a company’s products, those sales can count as retail. So now I'm wondering is, could network marketing simply be another retail business without a store?

The most recognized MLM businesses have been Amway, Avon Products and Tupperware, to name a few.  These days, you see MLM businesses for all kinds of products and services.  Health and wellness is a huge MLM segment (think Herbalife, Melaleuca, etc.).  The majority of direct sales companies use a compensation plan where the seller is paid not only for their own sales, but also a percentage of the sales of other representatives they introduced into the organization and helped train.  The key to success in any MLM business is in duplicating a system and then leveraging that system through the work of other associates on your team.  You do not need to be successful sales professional to be successful in direct selling. 

The World Federation of Direct Selling Associations reports that its 59 regional member associations accounted for more than US $114 billion in retail sales in 2007, through the activities of more than 62 million independent sales representative. The United Sates Direct Selling Association reported that in 2000, 55% of adult Americans had at some time purchased goods or services from a direct selling representative and 20% reported that they were currently (6%) or had been in the past (14%) a direct selling representative.

You can see why the multi-level marketing industry has experienced growth in each of the last 20 years.  I can’t think of any other industry that can say the same.

The second part of this recipe for success involves the explosion of the Internet.  Every day over 100 million videos are viewed on YouTube.  In the last 5 seconds, 10 million emails have been sent! According to a New York Times article, overall, 57 percent of Internet use was devoted to communications like e-mail, instant messaging and chat rooms, and 43 percent for other activities including Web browsing, shopping and game playing. Users reported that they spent 8.7 percent of their Internet time playing online games. I guess what it says is that people are online.

Direct selling has seen entrance into the world of email, video and the video email business.

What’s next? Stay tuned for my experience with direct selling  and new technology. 
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A Homecoming Can Be All That You Make It and More

16 June 2009 Categories: Networking, Reaching the Consumer, Success

CN-liz1 Several weeks ago I was invited to speak at Carpet Network’s Homecoming 2009 in San Antonio, TX. Carpet Network is a shop-at-home franchise founded in the early 90s by Christine and Lenny Rankin. At the time they had a very successful floor covering store and decided to take their concept to the next level. It was obvious to Chris that it was often difficult for customers to make decisions in the store. It was much easier when the customer looked at the products in their own home. "With that," says Chris, "the shop-at-home concept that was to be Carpet Network was born."

CN-liz2 Chris continues. "At the time, when retail stores are struggling to survive, our mobile concept is booming. Our state-of-the art Unicell vans allow our customers to view thousands of carpet, floor and window covering selections from the comfort of their homes or business."

Just a note about franchised business, they are successful for one main reason: they have a proven system in place. There is no question McDonalds and Dunkin’ Donuts have survived because of their systems.  Franchise businesses have a failure rate of only 25% within the first five years, and traditional businesses have a failure rate of about 80%. It’s the system that works. By buying a franchise you are buying into a set system of rules and regulations that have been tested and work.

Fiesta Time!

CN-liz3 So, what better place to hold a “homecoming” but in San Antonio during Fiesta time. A local nonprofit group or military organization sponsors every one of the 107 official Fiesta events of 2009. Fiesta is one of America’s truly great festivals. It began as a way to honor the memory of the heroes of the Alamo and the Battle of San Jacinto. For over 100 years Fiesta has celebrated the diversity and culture of San Antonio.

The theme of Homecoming 2009 for Carpet Network was all about how franchisee members could take advantage of new ways to build their business. Social networking with Facebook and Blogging spurred much great discussion. Facebook seems to be a way of communicating for everyone these days — including the Fiesta — with their page hosting hundreds of comments as well as information on events.  With golf events, carnival, great food and music, San Antonio at Fiesta is a wonderful place for a convention. 

CN-liz4 Speaking of social networking, Lenny Rankin, CEO of Carpet Network, gave some interesting facts on social media*.

  • 85% of Americans believe a company should not only be present via social media but also interact with its consumers.
  • 60% of Americans interact with companies on a social medial web site, and one in four interacts more than once a week.
  • 56% of American consumers feel both a strong connection with and better serviced by companies when they can interact with them in a social media environment.

Of course no business event is compete without its stars. Dave Fitzwater was chosen for the President’s Award, Carpet Network’s highest achievement.  I had the opportunity to talk with Dave and get his thoughts about Carpet Network’s mobile business and why they are so effective. Here's what he said:

  • The ability to go to the customer is key. You don’t have to wait for the customer to come to your place; you have been invited to theirs. It’s important to be professional and organized.
  • Without a storefront your overhead is greatly reduced. Having a well-equipped mobile showroom is just as effective as a brick and mortar business.
  • People get connected to the person with the products. Not the products or the storefront—but the person. Often times this gets misinterpreted by salespeople. They push their products instead of building their own credibility.
  • You must have good training and support from your home office. Having a good franchise behind you keeping up with trends and providing good back up is key.  

Great weather, wonderful town and great people; what could be better?

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A Smokin’ Good Time

09 June 2009 Categories: Networking

So what are 200 men — paying $150.00 each — doing at the Washington Avenue Armory in Albany, NY on a Thursday night? You got it, smoking good cigars, eating great food, talking with friends and getting a shave!

Habana Premium Cigar Shoppe's annual Habanapalooza event was so big that it had to be hosted in the huge Washington Avenue Armory. Guests received cigars, amazing food as well as raffles and door prizes. I caught up with chef Carmine from the eponymous Carmine's to gush over his chicken dish. I was hoping to get a doggy bag but there was nothing left at the end of the night. More spectacular food from Lo Porto and Yono's.

Carmine The event was hosted by Scott Bendett, owner of Scott Pipes and Cigars. I caught up with Scott and asked what the purpose of the event was. His reply was, "These are my customers who have stood by me all these years and I love having them all here."

Scott talks about the "old days" when, 13 years ago, he started the Habana Premium Cigar Shoppe with 15 boxes of cigars in a cart in Colonie Center. Today, Scott not only has two locations in the Capital District but is a leader in the cigar industry.

"What did it take to get where you are?" I ask Scott. "A lot of hard work and loyal customers," he says. Scott is also proud to have been voted the best cigar store by Times Union, Metroland and Capital Region Living. Scott has at least 15 events scheduled through the next two months. He also hosts a weekly radio show, The Good Life, on Paul Vandenburgh's TALK 1300 AM on Saturdays at 1:00 PM.

Okay, so what was I doing there? I don't get to go to cigar events that often, but I do have a favorite place
in Oklahoma City called Makers Cigar and Piano Lounge, where they also have good music
and cognac. My client, Sim’s Barbershop, was asked to provide complementary shaves to the guests at the show. Armed with lots of product, two barber chairs, and lots of good humor, owners Greg Zorian, Steve Vilot and barber Jill Sbrega start the shaves and the fun begins.  Greg and Steve love to do what they call their "extreme shaving" — shaving any place any time. Men have been shaved on ski slopes, golf courses, race tracks and at Habanapalooza. I have to admit, not having attended this type of function, I was unaware of male camaraderie. Sure, sporting events are one thing— though I wonder if maybe this is a sporting event.
Shave1
According to Greg and Steve, getting out of the shop is a way to build business and get to know new people. Greg's been in the barber business since he was 14 and says "Men love to have a place of their own to get pampered just like women. High-end barbershops have never been out of style, there just aren't many of them."

With business tight, networking is a solid way to add to your customer base.

  • If you want to make new friends and get new customers, you have to get out of your place of business.
  • Be different, have fun and give value. What's value? It's more than the customer would ever expect.
  • Be willing to partner with other businesses. These don’t have to be aligned businesses, just good businesses that provide great service and are willing to share their customer base.
  • Remember that in order to get, you have to give. Be willing to get out and invest in your community.  Greg, Steve, and Scott are huge supporters of their local chambers and attend as many functions as possible.

I interviewed many guests and asked the question: why come here? The answers were almost always the same: good food, a good cause and good friends.

I guess it can’t get much better that.

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Who’s Watching You?

02 June 2009 Categories: Advertising

Kash How do you know if your ads are good or bad? Does it really matter?

What really matters is that someone notices and the customer remembers you — enough to buy.

Some things I just don’t always get. Or let’s say I just don’t get it quick enough. One of them is the GEICO "Kash" campaign. Don’t get me wrong, I am fascinated by the campaign, I just don’t know if it changes my ideas about insurance.

The Martin Agency is the brains behind the Kash idea. In a nutshell, the campaign shows a creepy-looking stack of money with eyeballs staring at you — seemingly to indicate the money you could have saved had you been a GEICO customer. In the commercial, a roofer tells another roofer that he’s being watched or “scoped out” (by a girl, he thinks). Of course the roofer is being scoped out by a creepy stack of GEICO money.

In this one, a man stops for directions and he notices a GEICO stack of money looking at him from the fence. The man looks and says, “Poor fella. He must have been following you for miles. Looks tired.” Everyone is creepy and it makes you think twice before asking for directions on a lonely highway. The interesting thing about these spots is that they are so random.

In another commercial, a businessman is distracted during a meeting when a squeaking noise diverts his attention. It's Kash, who appears on a window-washer platform. "That's the money you could be saving with Geico," explains a co-worker. And finally, in another ad, a woman spends more time flirting with Kash than her date. All commercials end with a remake of the '80s Rockwell hit "Somebody's Watching Me."

Okay, so the character represents the average national savings consumers get from using GEICO, which is supposedly $500. According to Mike Lear, associate creative director at The Martin Agency, an IPG shop in Richmond, Va., "Geico loves to talk about savings, that's their recurring theme. We just dumbed it down to the most basic thing in the world, 'I want more money.'"

With the song, of course Geico wants you to hear it and think of GEICO. Kash now joins the animated gecko, the surly caveman and the consumer/celebrity testimonials. This all translates to $595 million in advertising dollars, according to Nielsen Monitor-Plus.

That's quite the chunk of change.

Okay, so many of us haven’t been smart about our money and of course now we all know it. Don’t get me wrong, I think the commercials are funny, and I feel “empathy” for the cavemen, but I actually haven’t gone and compared my existing insurance rates with GEICO.

Have you?

Resources
Stanford Daily
Ad Week
Brandweek
www.adgabber.com

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