Death of a salesman
Today I dropped off my my Toyota Prius ‘Smug’ as my friends call it for a service. I decided to have a look at the new model Prius before I left.
The floor sales guy approached and asked if I was interested to which I said yes. I told him I already have a Prius and like it…. Big hint.
The abridged version of conversation then went something like this:
“Gee, they look nice…. How much are they?”
“I don’t know… I’ll find out”
he comes back with a quote sheet…..
“Does the non itech model have Satellite Navigation?”
No – it doesn’t”
“How much would it cost to get it as an added extra?”
“$4000″
“Are you serious… Gee that is quite expensive compared to purchasing a stand alone version… it’s 10 times the price in fact”
his response in a down talking tone…..
“It’s not some crappy thing from an electrical store….”
“hmm…. what would the price be on the car if I wanted to buy it today?
“Same price, it’s a new car, I can’t give you a better price than this.” (using that tone again)
“oh, full price?”
“Yes. Have you ever bought a new car?”
my response….
“Yes, and today – you wont be selling one.”
I then leave the show room.
Delayed Revenue Model vs Free (DRM)
I know I am being a bit of a dog with a bone here. But we really need to put this ‘Free’ stupidity to rest once and for all. Sure it’s semantics, but this is what the Free model really is:
Delayed Revenue Model
If we have a so called ‘Free’ model, we are simply providing resources (at out cost) in order to extract revenue through alternative means later, or via a trade sale to incumbents who see value in what we have created. In both cases the ultimate goal is Revenue.
In many ways it’s riskier to go down the free track, simple because time and money are inextricably linked. If we don’t end up ‘Monetizing’ (another word I hate) then we are simply in the wealth transfer business.
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How to make a sales call
Today I was out making sales calls in my local industrial area where there are a lot of different rental companies. Idea being to get these rental / hire companies using rentoid.com to generate extra business. The timing is good, because we have a zero cost entry platform and times are tough in the B to B arena.
But the thing that really matters is how I’ve been making the sales calls. Firstly, these guys are B to B, trades focused guys. renting mainly industrial equipment. The last thing they want to some tech / web geek give them bullshit about how the internet is going to save them…. So here’s what I’ve done instead:
- I haven’t shaved for 3 days – got a good beard growing. I’m wearing jeans and boots with a fairly standard zip up jumper. When I walk in I look like a customer, in fact I look like they do. I’m less threatening and this is obvious with the positive greetings I’m receiving.
- When I drop in (remember it’s a cold call) I say, ‘You know I live around the corner, I drive past here everyday and I’ve been meaning to drop in for ages. You know I’ve got web business which is all about rental companies…..” And I do live close enough to use this line. It is genuine.
- The F Bomb – Yep, I’m dropping this one big time – for one simple reason – they are. I’ll use whatever language they use. If they like swearing, so do I. I’m matching their culture in dress and language.
- I know their business. I don’t walk in and say ‘So tell me about your business’ – I do my homework before I turn up. Granted I know enough about the rental industry now to adapt to different segments pretty quick. I know what matters to them and get the conversation into that area quickly.
- I don’t try and sell anything on the first call. We do have a free entry to rentoid – but we also sell integrated web technologies. But I don’t try to sell anything. Just get them to like me in fact, I’m selling me. People buy things from people they like. Then they find a logical or business reason to justify their decision after they’ve already made it.
- I follow up with whatever I promise. Information, phone calls, data whatever they need. I try to show I’ll be a valuable resource.
- I get rejected too. It’s a numbers game, and each rejection is a lesson for honing my skills for the next call.
I’m learning heaps and I’m loving it.
Start up blog says – get out there and start selling.
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Business Plan Template
It’s well documented that I’m not a big fan of business plans. Mainly because we live in a world of flux. But if you must use one – which I’ll call a 1 page mud map – then here’s a template. I’ve used this and I’d recommend it for ‘real entrepreneurs’ – that is non VC seeking bootstrappers.
What is it?
Describe your business or service in a single sentence. If you can’t do this, you don’t know what you’re doing.
Who is it for?
The audience who need or want this thing you’re about to create. Define them in whatever terms you please, demographically, socially, behaviourally, geographically. Just be succinct and tight in your clustering.
Why do they need it?
How is it better than the current substitute options?
How will they find us?
Where will we gain distribution? Maybe we’ll leverage a strong retail chain. A singular high traffic location. If web based strong SEO / brand awareness will be required. Maybe we already have an audience who we’ll bring a product to. This should be the most detailed part of the plan. It should include brand awareness activities and promotions. It still should only be a round 1 paragraph long.
Cost to build Version 1.0
Just estimate it – then double your estimate. Now this is the bare bones version, the absolute minimum required for launch. Outsource every element of production were possible, unless you are the major factor of production. Keep the cost low. It enhances speed, and reduces fear of failure and inertia.
Revenue Stream
There is no such thing as ‘Free’ – just a delayed revenue model. Ideas include: Sell item for price, Percentage of sales, memberships, premiums, selling advertising among others. Your plan is not finished unless you can answer this in a way your mum can understand.
Next Steps
These steps are related to launching the product. We stop typing and start prototyping. Here’s where we have 3-5 bullet points on how to get to version 1.0 The quickest possible route to being live in market. The steps to when you can out there and start selling & promoting.
That’s it. In fact you final plan should be as short as that we see above. Print it, put it up in your office and get to work.
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Best in the world (How to be)
You are reading the number 1 startup blog in the world! Pretty cool huh. Just Google the words ‘Start up blog’ anywhere in the English speaking world.
It wasn’t always that way – when I started I was over 100 pages deep in Google. Now I have more than 30,000 readers.
Fast forward nearly 4 years, a blog entry every single day, on the same general topic (Startups & entrepreneurship), sharing knowledge and practicing what I preach I’ve made it to number 1. There were no tricks, no SEO, no overt social media promotion, not even the .com domain. It came down to 2 things:
1. Consistent output – high frequency of delivery
2. Useful content.
That’s it.
If you want to win, to be the best, then work towards it every day.
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Difference between traditional & social media
This is the difference between traditional and social media in one simple chart (albeit a little fuzzy). Forget all the crap you have read on how social media differs to traditional media. This is it summarized right here on startup blog in terms which matter for business:
I’ve made some notes above. Don’t believe what you’ve heard – old media isn’t dead – sure it’s more expensive for the return, but it still kicks but. When rentoid was featured on a nightly news TV show as a positive story, we had more hits that one day than we did for the entire year. And we had been and are investing a tremendous amount of time on new and social media. It’s been a two year effort.
If you want a few other qualitative ideas to take with you then here’s a few:
- They work better together
- Social media is incredibly slow but has a compound effect
- If I had endless funds available for media, I’d still prefer traditional media (for now)
These comments are based on fact and real experience in Australia from my business rentoid.com which has had heavy exposure in both.
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Start Up Blog live v2.0
Given the success of Startup blog live this week, I’m doing it again next week. We had over 50 people tune in, with virtually no planning, or promotion at all, and had a 1.5 hour Q & A on all things Entrepreneurship and Start up. I really enjoyed it.
So I’ll be back on live this Wednesday Night 7.30pm (Australian EST) on www.Twitcam.com
- To see what time that is in your part of the world click here
- I’ll be doing it using my twitter log in which is @sammartino
And you’ll see on twitter when I’m live – and I’ve got the technology sorted now which is really simple to use. In fact, I reckon I came up with some of the best ideas I’ve ever had while talking. So spread the word to your entrepreneurial friends, they’ll love it too.
Best question of the night wins a rad Pez Dispenser as show below:
See you Wednesday night!
The truth about viral marketing
It’s a crap shoot for any form of ‘commercial marketing’ to go viral. So I thought I’d summarize it with a tidy little Venn diagram.
Discuss & debate.
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The power of templates
Henry Ford built a template for mass manufactured vehicles.
Bill Gates & Steve Jobs built templates to enable computer usage in the home. (They also stole some ideas)
Netscape built a template to enable people to browse the web.
McDonalds built a franchise template.
Ebay built a template for selling and on line auctions.
Write a book once, sell it for years. Record an album once, sell it over and over. The same holds true for movies and all paid software. The production line also exemplifies this. Pretty much every successful business we see – has built a template that works. And often it takes a long time to work out what that template should be. Which is why we usually run out of time before we run out of money.
What we need is a replicable formula: Something that can be built, designed, made, or bought once, but sold over and over again. It’s all about efficiency and the multiplier effect. Some of the oldest business models in the world follow this maxim. Think about real estate. You buy an investment property once, and you sell it over and over again, every month as ‘rent’. Efficiency is not necessarily evil. More importantly, this is also the component of your business model that helps it grow beyond the founder. If our business can’t survive and grow without us, the truth is, we haven’t really got one.
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Shiny new business
Have you ever had a new girlfriend? You can’t stop thinking about her. You want to make it work. So you start putting in an extra effort to give this relationship the best chance of success. You start buying new clothes, ensuring you look your best, maybe even start going to the gym everyday. In this situation everything matters. You want to spend every waking moment with her, because it is so enjoyable, so much fun, the future looks so bright, the whole thing is so new. At this time we can’t imagine the joy of being involved in this thing ever diminishing.
Eventually, the emotions driven by newness wear off. It doesn’t necessarily mean we love our new girlfriend less, we might even love her more. It’s just a different set of emotions. And this new set of emotions often mean we, are less enthusiastic to prove ourselves, and or make it work – she moves from a chase, to a catch.
A new startup isn’t much different. Just re-read the above two paragraphs and think back to when you got going on your latest startup. It was a lot like the new girl friend. It was love. The emotions and behaviour have a strong analogy. What matters as entrepreneurs, is having the ability to keep up the momentum when the newness wears off. And there is nothing more certain than this. It will become less fun, less exciting and more arduous. It’s especially evident when we need to undertake administrative tasks with our start up – or keep door knocking after many rejections. It’s our ability to stay focused on ‘old projects’ that will determine our ultimate success.
