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A fundamental necessity in selling yourself, your ideas, your products, or your services is to have answers to all the questions that the recipient of your sales pitch might ask. Especially obvious question!!! Last night I was solicited by a local politician named Kate Holloway of the Ontario Liberals who is running in the upcoming election in my riding (Trinity—Spadina). When I heard the knock on my door the first person to greet me was a gentleman whose job it is to cordially break the ice with the tenants. He is charged with the duty of informing the tenants of the upcoming elections and to keep them engaged in conversation until the time that Mrs. Holloway is done answering the previous tenant’s questions and arrives to engage the new tenant. So last night when the gentleman arrived at my door he quickly answered my question about the ideological stance of the Ontario liberal party (unfortunately unlike British Columbia’s Liberals they are left of center) and my other questions pertaining to the elections. Shortly after Mrs Holloway arrived and asked if I have any questions for her, and I responded by asking what the party’s political platform was.
Starting from the moment she opened her mouth to answer, everything she said worked to her disadvantage. She immediate when straight into a scripted response opening with, “Well we are going to be opening up new daycare facilities…” (Wrong answer)! In my mind as soon as she said this I thought to myself, in what way have I given her the impression that I even remotely care about day care spending (At the present time I neither have a wife or kids). She then went on and on and on about various unbudgeted social programs…”$130M of new street cars, $670M for subway expansion, $620M for Highways…$200M there…$1B there…$3.6B there…” The image I had in my mind while she was telling me this was little 18 year old Kate Holloway at the mall with a brand new credit card. “I am sorry”, I responded after a while, “but what are you going to do for business…”? Her reaction to my question completely caught me by surprise. She was completely dumbfounded, at a loss for words, and kept repeating “ah” and “um”. The gentleman with her interjected to give her the time to think, and brought the question completely off topic and into an illogical loop. Finally about a minute and a half later she proceeded to give me an answer about how a few years ago their party (still currently in power) fixed the price of renewable energy alternatives to remove price fluctuations. I felt like telling that price fixing actually hurts the overall business environment but instead I just thanked her for her time and wished her good luck.
Now the reason I brought this up is that she made many fundamental mistakes while selling herself to me that led to me not trusting her with my tax dollars. They include not qualifying me through a quick question and answer period (Q&A) to giving me a scripted pitch, to not knowing the details of her service, to not asking for the close. In my next post I have put together a guide that will address all of these fundamental mistakes. I talked a bit to her campaign manager in the elevator about 20 minutes later and told him that they have a lot of work to do. Well at least they now know what they have to work on for the debate.
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These 3 videos (at the bottom) explain exactly why Google is so amazing at marketing and what Microsoft need to learn. These are by Eben Pagan, founder of Double Your Dating and getaltitude.com. I suggest you watch all 3 of these videos because they contain a lot of free valuable information. I have made a few notes that follow the key points if you don’t have the time to spend 25 minutes watching them.
Notes on the Videos
- It is easier to get $10 out of someone if the perceived value of what you are selling is $100 than it is to get $1 out of someone if the perceived value is only $1.
- People are too narrow minded to let go of an immediate deal that they perceive as greater in Value than what it is on sale for. Monkey trap example: In Africa hunters make a hole in a tree and place a nut that is the same size as the opening of the hole. Monkeys will put their hands in a grab the nut, but will not be able to take it out because their hand is too big to exit the hole while holding the nut. Monkeys will stay clutched on to the nut and will not let go, which allows hunters to walk up to the monkey and kill it.
- Wealth is in the mind. Wealth is a mindset. If you don’t think with a wealthy mindset you will never become wealthy.
- Love getting the short end of the stick. It will make you money. (Reference to selling $100 of perceived value for $10)
- Psychological Experiment: There are 2 people: person A and person B. Person A is given the opportunity to decide how to divide $100 between the two of them. Person B was given the opportunity to decide if both of them would get what person a decided or nothing. Through this experiment psychologists found that there was a threshold at $80 to person A and $20 to person B where person B would rather see both of them get nothing that to walk away with $20. The experiment was repeated in a third world country where $100 was worth months of income, and psychologist found the exact same thing. People will walk away from a month’s income for free, just because they could not stand the thought of someone getting a better deal than them.
- If you keep your ideas secret and don’t show the value in your ideas to others, then you won’t get any attention at all. Eban Pagan’s view on this is that if you give away these amazing ideas for free, then people will ask themselves, “How much better is the product that they are selling, if they are giving this away for free.”
- Move the Free Line: Give away what are entry level products for free, and build your customer base. This will allow you to sell more profitable products to more people. Giving away information products for free with your main product is the best way to increase you conversion rate. They have the lowest cost and highest perceived value.
- Move the Depth Line: The more value you give on the bottom the deeper the relationship you build with you customer (Sounds similar to what the manufacture I talked about in my last post did with me. Gave a lot of free development and deepened the relationship with me). The more you deepen the relationship with the customer the more demand you will find for higher value products. Therefore create higher quality and higher margin products to offer you consumers that you have deep relationships with.
- Naming is the area where business owners and marketers spend the least amount of time, but is one of the most important. Create a name the plays well on the phonological loop such as alliteration or rhyming and juxtaposition. Example: Coca Cola and Palm Pilot and Blackberry, Marilyn Monroe, Capitan Crunch.
Video 1 of 3
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Plain and simple: the problem with outsourcing is that you don’t always get what you are asking for. I have been dealing with a manufacture in Costa Rica for the past 2 months and they have been great. They are very professional and have been really easy to work with, even saving me thousands in development costs. There is one outstanding issue that has retarded the launch of my product for about a month and a half now, which is the fabric. I chose to use a full package manufacture (they do everything from A to Z) which is something that I suggest for any new entrepreneur. The only resounding problem with this specific manufacture thus far has been that it seems to have trouble giving me the exact fabric that I am asking for. I have provided them on three separate occasions with fabric samples of the type of fabric I would like to use in the production of my first line of clothing. They have promised me every time that they would easily be able to replicate the fabric and everytime the results they have sent me were not even close.
The last sample I sent them two weeks ago was significantly closer to one of the previous production samples they had sent me so that it would be easier for them to replicate. As a result the sample fabric I received back today was even further off the mark that the previous attempts at fabric replication have been. What I have noticed is that they keep sending me what ever is closest in their fabric catalog and don’t even try to replicate the fabrics that I ask for. These kind of manufactures are specifically tailored to replicate any type of fabric, and as I saw on my tour of the factory, they have all the required equipment to do so. The second to last sample they sent me was suppose to contain a blend of 90% polyester and 10% cotton with a weave that would make the fabric resemble cotton but have the wicking properties of polyester. After I ran a couple tests on the sample they sent me, I noticed that the fabric retained water just like you would expect in 100% cotton. I decided to put it to the ultimate test: a flame. Sure enough it did not melt like it should have if it were 90% poly, but it rather disintegrated which is characteristic of 100% cotton. This lie was very troublesome and I am getting increasingly weary of the company I have been dealing with. Even though they had won an immense amount of loyalty through their other services, their failure to provide me with what they promised has nearly crushed their loyalty advantage. They obviously have a significant weakness in the production of fabric and this needs to be rectified if they plan on competing in this global market. Here is a marketing and customer relations rule that every company will want to follow: Never promise your customers something you cannot deliver on, because one lie will erase countless favors in the past. Thus it is better to be honest and lose a customer for one contract, than to lie and to lose him for life.
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I just recently started a blog 3 weeks ago in order to document the building of my apparel business, and I have to say that it has helped keep me really motivated. I link all my posts on my Facebook account so that my friends can see what I’m up to. I find that I am holding myself accountable, during times of potential distraction, to what ever I post on my blog. This I find is due to the the social pressure of making sure I keep the integrity of my word in all my posts. Let’s hear a cheer for Wordpress (for those of you who do not know, it is the software that I am using to blog).
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Anyone wanting to become an entrepreneur will find this series very interesting. I have to say that this interview of Eben Pagan (founder of getaltitude.com) is really interesting. I had previously watched his videos on marketing which I suggest you watch and which I’ll post after this post. Click the link below to see all 7 videos…
Video 1 of 7
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One of the reasons that I love Facebook and that I hardly use Myspace is because of the “legitimacy” and “truthfulness” of everyone’s profiles compared to Myspace. When I browse one of my friend’s profiles on Facebook I always find what I’m looking for quickly and I know that it is more or less accurate. It worries me that Facebook is slowly turning into another Myspace and opening it up to Google’s crawlers might invite many unwelcome changes. What I don’t like with Myspace is that a majority of the activity in my profile constituted of annoying people trying to cheaply pawn their mediocre products, services, parties, bands, or what ever on everyone… I became inundated with messages by people who seek to annoyed the majority around them with their self serving message. I draw a parallel between these type of Myspacers and pyramid marketers or religious zealots who try everything to push their products, services, or ideas onto you. Myspace has really lost a lot of credibility with me. Within the first week that I started using it I had about 30 friend requests, of which only 3 were actually legit requests from people I actually knew. It was enough for me to stop using Myspace, and I hope that Facebook will not become the same. I am Already very annoyed by some of the new applications that have been created and send out invites to friends of the person adding the application to their profile. What I find even more irritating is that some of my so called Facebook “friends” actually think I would even slightly be interested in an application called “Vampire”, “Superwall”, or “Free Gifts”. What people don’t realize is the more that they blanket the digital social landscape with their plugs, the less effective these plugs become. We are now at the point where the ‘interuption marketing’ causes such a minute impact that it only serves to irritate those around you. For those people wanting to learn more about how to successfully market your products, services, and other junk you think I’m interested in, I suggest you pickup Premission Marketing by Seth Godin and learn how to get my permission to market to me.
Now there is some positive in the fact that Facebook will be indexed by the various search engines other than making it easier to browse and find information you are looking for (A.K.A. Facestalking or Facecreeping as some of my friends like to call it). By indexing Facebook it will be possible to increase the clout that your SEO efforts on Facebook have in impacting your keyword rankings and pagerank. This of course is a great thing for web entrepreneurs, and will lead to increased profits, but as stated above it will ‘I believe’ lead to the degradation of Facebooks legitimacy.
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Employer Identification Number “EIN” - This is what any US corporation needs in order to open up a bank account, hire employees and do a multitude of other business related activities.
So today I dialed the IRS in order to get an EIN for Silverback Apparel Inc with a lot of reservations about having to deal with the “BIG” and “ScArY” IRS. Well I do have to say that things did not turn out the way I had expected they would have. I did start off by dialing the wrong IRS department, but this was quickly rectified by being transfered over the the Business department, where I was quickly connected to an agent. I am astounded at how friendly, informative, and curtious the gentleman who helped me out was. I was even more amazed by the fact that he told me that I would have my EIN number within 10 minutes. He asked me all the questions that you find on the SS-4 form (the form needed to apply for an EIN) and within 5 minutes of having answered those he had my number. He informed me that an official document (needed to open a bank account) will be sent to Canada for my records and the it would arrive within 2 weeks. All in all I have to say that so far dealing with the US government so far has really been a lot quicker and less painful than I thought it would be. My advice to Canadian business men wanting to do business in the US is to actually phone the IRS because they will help answer your questions right away, as well as expedite you EIN application.
Internal Revenue Service
irs.gov
Telephone Assistance for Businesses
Toll-Free 1-800-829-4933
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At about 10:45 PM I received and email on my Blackberry indicating that I was officially incorporated, and that all the documentation was in transit. To incorporate I decided that I did not want to go through the hassle of filing for incorporation myself for 2 reasons. First, because I am currently living in Toronto and wanted to open a US corporation, not having a US address would make the whole process much more difficult, time consuming and expensive for me. Secondly, the opportunity costs were much less if I were to hire a document filing service company and so I chose to deal with MyCorporation and purchase their expedited service. Intuit as I hope most of you have heard of, is the owner of this company and also the reason that I decided to choose MyCorporation rather than their competitor Corporate.com. I was amazed at how easy and seamless the whole process was and how helpful the rep who helped me was (Marvin, who also gave be a $25 discount). All it took was a quick 30 minute call to their call center and 1 signature on a piece of paper they sent me via UPS (which I returned the very same day). Then two and a half weeks later (today) I received my incorporation package with all my corporate documents. It even comes with a CD that takes you through the whole package and explains everything about its contents and a copy of Intuit’s Quickbooks. I am just so impress by how well put together this program is and how easy they made it for me to open up a company. I would definitely suggest to anyone wanting to open an American corporation, that they check into using this company’s services.
There is only two things that I need to do before I am ready to do business and that is open up a back account and get a mailing address. It will be a bit of a hassle to open up the bank account because to do so I need to get an Employer Identification Number which I need a social security number to get. This will force me to deal with the IRS which I doubt will be nearly as easy as dealing with MyCorporation. At least opening a mailbox with mail forwarding should be easy (2 words: Mailboxes Etc).
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The week long competition for my companies logo and stationary design has just finished and I have to say that the results were far better than I had ever expected they would be. During this 9 day competition, I received 108 design submission, of which 25% were in the quality range that I was looking for. I did receive several submissions that were completely ridiculous, but all in all, I had great designers working in my best interest. I have to say that I gained more than just a great logo and stationary design, I also acquired several design contacts that are going to be willing to work with me in the future whatever I may need.
There is something that I notice throughout the competition with reference to the quality and direction of the designer’s work with reference to why one designer in particular easily won. Arpad, the designer above all the other designers listened and asked questions about what I wanted. He was very professional, and I noticed that above all the other designers he was more attentive to and spend more time envisioning what I was looking for. I found that many designers were not trying to put themselves into my shoes and therefor submitted many pieces of work that were completely in the wrong direction. What I want to let anyone planning to create a competition and designers know is that success is in the details. What I mean is that the design brief is the most important thing that the contest holder has to work on, and designers focus on. Too many times did tell the designers, “this is not what I’m looking for, read the brief”. This brief should have created the foundation for every design submitted, but it failed to be so with every designer except with 5.
Now come the fun part… I have about 5 designs that I am intending on testing out on my consumers, and what better way to do this than through a good old fashion split test. In the same way I picked my company name, I will pick my logo. I know that whatever logo I do finally end up with will be the best because it will have been chosen through unbiased empirical evidence. I am going to be using Google Analytics, Google Adwords, and probably Shopify to determine the consumers response to my new logo designs and how well they convert into a sale. I am looking forward to the results and I will keep you all posted.
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My competition has been running for almost 6 full days and I have to say that I am overwhelmed by the response from the design community. I have about 22 good submissions out of 87, which is astounding. I have been communicating with every designer (through comments and private messages) who has been producing good results in order to steer their designs towards what I want. The designers are very receptive to all my comments and have been very forward about asking me to clarify my objectives. One thing that I have notice in going through other competitions, as well as the public and private comments the designers have left me is that there is definitely a right and wrong way of running one of these competitions. First off for your sake you want to be as clear and descriptive as possible when you are writing up the title of your competition. You want to give people clear reason to click on your post over that of others and I will insure that they know what its about before they get into the nitty gritty details. The evidence is in the clicks…All the surrounding posts except for a few other well written ones have about half the number of click and submissions. The second is that it is important to summarize the project clearly in the sub description so that designers know what to expect. The third and most important in terms of getting exactly what you want is to have a clear, outlined and precise project brief. From the comment that the designers have made, they were pleased with the bit of extra time that I put into the brief. This has also helped me in the sense that I know what I want and if a designer is not giving me what I want I can just refer him to the brief
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