Measuring return on investment (ROI) in marketing is an important and complicated issue. As with any other investment, businesses want to know they are getting value and increasing their bottom line. However, there are some fundamental differences between marketing and financial investments.
Marketing ROI isn’t straightforward. Different companies have different needs. Some sell expensive durable goods that are bought infrequently. Others sell packaged goods that can fly off the shelves. Still others sell business services with high acquisition costs and need to build long term relationships; the initial sale isn’t worth much. In fact new customers often have negative initial economic value.
So it is not surprising that evaluating ROI is confusing. Approaches can vary from an assistant with an excel sheet to sophisiticated software and high priced consultants.
The most important thing to remember about Marketing ROI is that there is no perfect formula. You have to choose the method that best fits your needs. A good place to start is to clarify what you want to achieve.
Company Strategy
How a business approaches ROI will depend a great deal on company strategy. Harvard professor Michael Porter lists three types of strategies:
Cost Leadership: Companies with a cost leadership strategy tend to be more focused on direct response advertising, so the ROI picture is somewhat clearer. Direct Response is fairly easy to measure.
Focus: Companies that focus on a particular market segment usually have limited marketing budgets. They are either regionally focused or cater to a particular type of customer. The marketing ROI equation is somewhat simplified for companies with a focused strategy. They don’t have that much going on.
Differentiation: Companies with differentiation strategies are the most marketing intensive. Their success depends on consumers believing that they offer something better than their competitors do.
Brands that seek to differentiate themselves need to build passion and desire for their brand. This strategy can be immensely profitable because consumers are willing to pay a premium for brands that they love and trust. Strong brands also tend to have lower acquisition costs.
For companies with a differentiation strategy, marketing ROI doesn’t just involve sales, but the perception of their brand that leads to sales. They track not only brand awareness, but also “brand attributes” – what people think about their brand. For instance, McDonald’s tracks attributes such as perception of value, quality, taste, “good for kids”, etc.
Marketing ROI for a differentiation strategy is complicated further if it involves a durable good with a long product cycle (i.e. cars, home appliances, etc.). Consumers who desire their product might be years away from a purchase decision.
Four Basic Approaches to Marketing ROI
Timelines: Making a timeline of marketing actions can be very useful. You can see what you did, when you did it and track response, such as sales, inquiries to the call center, etc. By comparing marketing inputs and outputs you can get a sense of what drives sales. If you can identify a correlation, the math is pretty straightforward and you can get a good idea of what drives your ROI.
While the approach has the virtue of simplicity, it also has its problems. For instance, a timeline only shows when the action happened, not how intense or how long it was. Furthermore, if there is a lot of activity, the timeline becomes unreadable and loses the virtue of clarity.
Grids: Because of the limitations of timelines, many marketers use grids. They are very easy to make in excel and you can overlay activities of different durations.
Moreover, additional information can be inserted into the grid. For instance, you can show that you bought 200 GRP’s of TV per week for 5 weeks and also ten monthly magazine insertions and 1 million banner impressions per week for six weeks. Grids retain much of the simplicity of timelines and contain much more information and flexibility.
However, grids too have their drawbacks. How should intensity be measured? For TV, is GRP the right metric to use, or should it be coverage at a discreet frequency or share of spend in the category? For internet, should banner shows be in the grid? Clicks? Registrations?
Grids also can also get cluttered and confusing. For some very active brands, they become enormous and unwieldy.
Tracking and Two-Variable Modeling: Another approach is to track all activity using a variety of metrics. With tracking, you lose the visual simplicity of grids, but you can include as much data as you want.
You don’t have to guess beforehand what you think will be most relevant. After tracking for six months or so, you should have enough data to build two-variable econometric models. (For more on models, see Less Numbers – More Math).
Two variable models require some mathematical sophistication, but can be done in excel. No expensive software is required. There are some subjective decisions to be made about which model to fit, but common sense goes a long way. Usually the simplest model is best.
Once you find a good model, you can derive the equation and significantly increase efficiency through better planning. However, two variable modeling can be very labor intensive. You need to try a number of variants before you find one that fits well enough to be useful.
Unfortunately, if there is too much market activity, it will be hard to find a two-variable model that explains more than 50% of the variation in the data. A model that offers more doubt than certainty is of questionable value.
Multivariate Modeling: Some of the world’s premier marketers use multivariate modeling. While prohibitively expensive for most companies, you can include a variety of marketing and economic factors and get much better models than you can using only two-variables.
However, multivariate models are extremely complex. PhD level mathematicians need to be contracted. Moreover, designing a good model is as much art as it is science. Those that build the model have to understand the business and the business people who use the model need some understanding of how it works.
For a successful multivariate effort, the rare combination of high level quantitative skills and street level business acumen is essential. That’s difficult to achieve.
Furthermore, even the best models will fail at some point. As markets evolve, success factors change. The world is a messy place.
Beware of Easy Answers
Often, the story is more complicated than it seems at first. Years ago, I had a magazine consulting client who was experiencing a fall in copy sales. Because there were no new launches in their category and they had no change in their marketing strategy they assumed that their product needed to be reworked.
It turned out that, although they hadn’t altered their marketing intensity, competitive activity had doubled. Comparatively, my client’s marketing activity had dropped in half. By raising their marketing budget to meet the competition, they were able to reverse the slide and maintain the integrity of their product.
It’s because of the complexities described above that ROI is probably the most difficult and contentious issue in the marketing arena today. There are many ways to get it wrong and very few ways to get it right.
Some Common Sense ROI Rules to Follow
Keep it as simple as you can: One core principle of econometrics is to always use the simplest model that explains the data adequately. If you’re getting reasonably good insight with a simple process, there is no point in trying to be more sophisticated.
Define your goals: No ROI process can explain everything. While a perfume brand might want to focus on consumer perception a retail business will focus more on direct sales. You can’t optimize your marketing strategy for everything. Managing a business is about making choices.
Check your work: Once you believe that you have identified a factor that drives your marketing performance, try to get the same result using a different method. When evaluating marketing ROI, it’s easy to get false positives.
Avoid bias: If at all possible, people who are implementing campaigns shouldn’t be responsible for evaluating them. Suppliers, for the most part, shouldn’t even bother with ROI. Unless there is a very integrated relationship with the client the analysis will be ignored at best. At worst, it can be selectively used against you.
Eventually your model will fail: Even the best models are based on past experience and any bearing on future performance is tentative. A failed model shouldn’t necessarily be seen as a bad thing. It is a signal that the basis of competition has changed, and that is very important for a marketer to know.
I hope this has been helpful.
Wednesday, December 9, 2009
Tuesday, December 1, 2009
swiss cheese
Have you ever driven somewhere, gotten there, and forgot
about the last minutes of the drive? You know that you were
driving. But your mind must have been somewhere else, since
you can't really remember the turns you made, the lights you
stopped at, etc.
But, I'll bet that never happens to you when you're lost.
When lost, your brain is working overtime to figure out what
to do next.
When I recently interviewed Dr. Neale Martin, he explained
that the difference in the two situations has to do with
which part of your brain you were mostly using. When going
on a routine drive, perhaps from home to work or vice-versa,
you primarily use your subconscious or habitual mind. But
when you are lost, or on the phone while driving, you
primarily use your conscious or executive mind.
Importantly, as Dr. Martin lays out in his book "Habit:
The 95% of Behavior Marketers Ignore," your subconscious or
habitual mind controls the vast majority of human behavior.
For example, when you reach for a carton of milk from the
supermarket, do you really think that much about it? Do you
compare the different brands of milk and think "maybe today
I'll try something new?" Or do you simply pick the same
carton of milk you chose last time, and the time before, and
the time before. Most of us do the latter.
Understanding these habits is critical to entrepreneurs who
want to effectively market their products and services. For
instance, once you sell a product or service, you should
focus on ways to get the customer to buy again and again
from you. According to Dr. Martin, once they buy seven times
from you, buying from you becomes habit.
And so they buy again, and again and again. Until you do
something like raise your prices or interrupt their service,
which causes their executive mind to kick in and consider
alternatives.
Likewise, when marketing a new product, you need to make
sure it jives with people's habits. For example, if people
are used to doing something one way, asking them to do it
another way, even if that way is better, is oftentimes
difficult. Entrepreneurs must make adopting their products
and services as easy as possible and ensure that they don't
contrast sharply to consumers' habits.
So, the next time you are driving and forget where you are
or what you are doing, know that you don't have a Swiss
cheese brain. Rather, you are so used to what you are doing
that you're relying on your habitual mind. And remember, as
a marketer, you must realize that your customers are also
frequently using their habitual minds when making buying
decisions. So, figure out ways to make buying your company's
products and services their habit.
To Your Success!
about the last minutes of the drive? You know that you were
driving. But your mind must have been somewhere else, since
you can't really remember the turns you made, the lights you
stopped at, etc.
But, I'll bet that never happens to you when you're lost.
When lost, your brain is working overtime to figure out what
to do next.
When I recently interviewed Dr. Neale Martin, he explained
that the difference in the two situations has to do with
which part of your brain you were mostly using. When going
on a routine drive, perhaps from home to work or vice-versa,
you primarily use your subconscious or habitual mind. But
when you are lost, or on the phone while driving, you
primarily use your conscious or executive mind.
Importantly, as Dr. Martin lays out in his book "Habit:
The 95% of Behavior Marketers Ignore," your subconscious or
habitual mind controls the vast majority of human behavior.
For example, when you reach for a carton of milk from the
supermarket, do you really think that much about it? Do you
compare the different brands of milk and think "maybe today
I'll try something new?" Or do you simply pick the same
carton of milk you chose last time, and the time before, and
the time before. Most of us do the latter.
Understanding these habits is critical to entrepreneurs who
want to effectively market their products and services. For
instance, once you sell a product or service, you should
focus on ways to get the customer to buy again and again
from you. According to Dr. Martin, once they buy seven times
from you, buying from you becomes habit.
And so they buy again, and again and again. Until you do
something like raise your prices or interrupt their service,
which causes their executive mind to kick in and consider
alternatives.
Likewise, when marketing a new product, you need to make
sure it jives with people's habits. For example, if people
are used to doing something one way, asking them to do it
another way, even if that way is better, is oftentimes
difficult. Entrepreneurs must make adopting their products
and services as easy as possible and ensure that they don't
contrast sharply to consumers' habits.
So, the next time you are driving and forget where you are
or what you are doing, know that you don't have a Swiss
cheese brain. Rather, you are so used to what you are doing
that you're relying on your habitual mind. And remember, as
a marketer, you must realize that your customers are also
frequently using their habitual minds when making buying
decisions. So, figure out ways to make buying your company's
products and services their habit.
To Your Success!
Tuesday, November 24, 2009
client growth
We had to find new clients, serve clients,
develop our website, answer incoming phone calls,
manage the books, pay receivables, negotiate
partnerships, and so on and so on.
Like other successful entrepreneurs, as we grew
our company, we knew we had to hire great people.
There is no way that Jay and I could have
possibly managed everything the company had to
accomplish.
In fact, according to management guru Peter
Drucker, an entrepreneur must narrow their role
as they grow their organizations. The
entrepreneur must focus on the areas that provide
the most value to the organization, and delegate
the rest.
Yes, your ability to determine what to delegate
and to delegate to the right people is the only
way to grow a successful company. As author Jim
Collins states, "the most important decisions
that business people make are not 'what'
decisions, but 'who' decisions." That is,
determining "who" should do the work is
absolutely essential to the work getting done
right, and the company being successful.
As a result, it's no coincidence that new
ventures succeed, or fail, based on the quality
of people they hire. It's no coincidence that
Apple was so successful with a key early employee
like Guy Kawasaki. Or that PayPal was so
successful with Steve Chen, Chad Hurley and Jawed
Karim as key early employees? (Steve, Chad and
Jawed would later found YouTube.)
Simply put, your ability to hire the right people
is absolutely critical to your success as an
entrepreneur.
In order to teach you how to hire like an expert,
I interviewed Dr. Geoff Smart. Dr. Smart is the
Chairman & CEO of ghSMART, which helps companies
and investors identify the right people to hire
to ensure that they can achieve success. He is
also the co-author of the current New York Times
Bestseller "Who: The A Method for Hiring."
Interestingly, part of his research in conducting
his book was interviewing more than 20
billionaires and 60 CEOs, investors, and other
thought leaders, so Dr. Smart was able to learn
real-world methodologies that allow entrepreneurs
like you to hire with precision.
During our interview, Dr. Smart gave tons of
actionable information. Some of the highlights
included:
* Tap referrals when seeking new employees: 77%
of successful hires come through referrals. That
is, by asking your employees and
advisors/friends/colleagues who they know that
could be "rock stars" in the open position, you
can find great talent.
* Don't just create a job description. Rather
than simply creating a job description for your
open position, create a "scorecard." Among other
things, this scorecard should focus on the
desired outcome of the employee. For example,
rather than saying that the employee will be
responsible for calling on prospects in Indiana,
the scorecard must include numeric sales and
prospecting goals (e.g., must make 10 to 15 sales
calls/day and close $250,000 worth of sales each
quarter). Importantly, entrepreneurs should also
use the scorecard to judge employee performance
after hiring them.
* Probe in your interviews. Most interviews don't
unmask the real information and insight you need
to make quality hiring decisions. For example, if
a salesperson said they generated $2 million in
sales in their last job, it might seem very
impressive. But, only by asking the three "P"
questions can you really tell if it was. These
questions include how the $2 million compared to
the Previous year's sales in that territory, how
the $2 million compared to the Planned amount of
sales, and how the $2 million compared to sales
by the individual's Peers.
Dr. Smart made tons of great additional points
that entrepreneurs can use immediately to start
building stronger teams and achieve more success.
In fact, we are in the process of hiring more
customer support staff for entreprenuers University,
and will be employing his techniques immediately.
To Your Success!
--
Venture Capital Intl., Thomas Duffy, CEO
Cell: 203.775.9999
Fax: 203.648.4942
develop our website, answer incoming phone calls,
manage the books, pay receivables, negotiate
partnerships, and so on and so on.
Like other successful entrepreneurs, as we grew
our company, we knew we had to hire great people.
There is no way that Jay and I could have
possibly managed everything the company had to
accomplish.
In fact, according to management guru Peter
Drucker, an entrepreneur must narrow their role
as they grow their organizations. The
entrepreneur must focus on the areas that provide
the most value to the organization, and delegate
the rest.
Yes, your ability to determine what to delegate
and to delegate to the right people is the only
way to grow a successful company. As author Jim
Collins states, "the most important decisions
that business people make are not 'what'
decisions, but 'who' decisions." That is,
determining "who" should do the work is
absolutely essential to the work getting done
right, and the company being successful.
As a result, it's no coincidence that new
ventures succeed, or fail, based on the quality
of people they hire. It's no coincidence that
Apple was so successful with a key early employee
like Guy Kawasaki. Or that PayPal was so
successful with Steve Chen, Chad Hurley and Jawed
Karim as key early employees? (Steve, Chad and
Jawed would later found YouTube.)
Simply put, your ability to hire the right people
is absolutely critical to your success as an
entrepreneur.
In order to teach you how to hire like an expert,
I interviewed Dr. Geoff Smart. Dr. Smart is the
Chairman & CEO of ghSMART, which helps companies
and investors identify the right people to hire
to ensure that they can achieve success. He is
also the co-author of the current New York Times
Bestseller "Who: The A Method for Hiring."
Interestingly, part of his research in conducting
his book was interviewing more than 20
billionaires and 60 CEOs, investors, and other
thought leaders, so Dr. Smart was able to learn
real-world methodologies that allow entrepreneurs
like you to hire with precision.
During our interview, Dr. Smart gave tons of
actionable information. Some of the highlights
included:
* Tap referrals when seeking new employees: 77%
of successful hires come through referrals. That
is, by asking your employees and
advisors/friends/colleagues who they know that
could be "rock stars" in the open position, you
can find great talent.
* Don't just create a job description. Rather
than simply creating a job description for your
open position, create a "scorecard." Among other
things, this scorecard should focus on the
desired outcome of the employee. For example,
rather than saying that the employee will be
responsible for calling on prospects in Indiana,
the scorecard must include numeric sales and
prospecting goals (e.g., must make 10 to 15 sales
calls/day and close $250,000 worth of sales each
quarter). Importantly, entrepreneurs should also
use the scorecard to judge employee performance
after hiring them.
* Probe in your interviews. Most interviews don't
unmask the real information and insight you need
to make quality hiring decisions. For example, if
a salesperson said they generated $2 million in
sales in their last job, it might seem very
impressive. But, only by asking the three "P"
questions can you really tell if it was. These
questions include how the $2 million compared to
the Previous year's sales in that territory, how
the $2 million compared to the Planned amount of
sales, and how the $2 million compared to sales
by the individual's Peers.
Dr. Smart made tons of great additional points
that entrepreneurs can use immediately to start
building stronger teams and achieve more success.
In fact, we are in the process of hiring more
customer support staff for entreprenuers University,
and will be employing his techniques immediately.
To Your Success!
--
Venture Capital Intl., Thomas Duffy, CEO
Cell: 203.775.9999
Fax: 203.648.4942
5 steps
Without further hesitation, here are 5 signs your business plan will come up short with investors:
Sign #1: You’re Selling What?
You know what you sell. But has your business plan clearly and concisely described those products and services? Too many business plan writers make the incorrect assumption that the reader is as familiar with their business as they are. Unfortunately, this assumption leads to a quick and final “no” from lenders and investors.
Instead, define and describe your product for someone who knows nothing about your industry. Be sure to include not only the features of your offering, but also the benefits. Tell the reader what need it fills, why it’s better, faster, or cheaper or how it can improve their life.
Sign #2: “I Sell To Everyone!”
Do you? More than likely, you sell to a very specific group with the need and desire to purchase your product or service. Understanding your target market can be the difference between success and failure. It allows you to outline the benefits important to your clients, enables you to focus your marketing efforts to reach the right audience, and forces you to determine the most cost effective channel to get your product in the hands of paying customers.
Define your customer in as much detail as possible, including demographic traits as well as more subjective items such as lifestyle and personality types.
Sign #3: Your Competitors Know You Exist
A business plan lacking a comprehensive competitive analysis is destined for the trash can of most investors. In order to avoid this fate your business plan should include a thorough analysis of your competition. Experienced capital sources know that competition exists, but they also know that competitive forces can have a very positive effect on a company’s attitude and performance. Remember, Coke has Pepsi, Microsoft has Apple, etc. Be sure your business plan identifies who your competitors are, what they sell, what market share they hold and their strengths and weaknesses.
Sign #4: Even Batman Had Robin
No one ever said running a company was easy, and with the lack of hours in a day (only 24 hours as far as we can tell), a well rounded TEAM of people is often critical to the success of a company. Most capital sources view one-person operations as limited in terms of time, experience and core business skills necessary to launch and grow a serious business. They also expect a team of professionals that are highly competent in each business function (marketing, sales, operations, finance, manufacturing, engineering, etc.). Once you have assembled your team, be sure to provide your business plan reader a thorough description of the background and job responsibility for each, along with a discussion of your board of directors, board of advisors and key consultants.
Sign #5: An Exit Strategy – Without An Exit, Or A Strategy
A business plan is an excellent tool to plan a business or to raise capital. However, when seeking capital don’t forget that an investor’s commitment hinges upon their ability to recoup their initial investment and a healthy profit. The lack of a solid and realistic exit strategy demonstrating how investors will accomplish this goal can immediately turn off many sources of capital.
When deciding upon an exit strategy, be sure to take into account your particular industry, business life-cycle, competitive environment, and management needs. It’s also important to consider your personal and financial goals, and how they relate to the future of your business – without forgetting that an exit strategy must meet the needs of the person who will ultimately write you a check.
Good Luck and Happy Business Planning! For more information on preparing a top notch, investor ready business plan call me
html://www.tduffyllc.com
Venture Capital Intl., Thomas Duffy, CEO
Cell: 203.775.9999
Fax: 203.648.4942
Thursday, June 18, 2009
speaking
Over the past decade, I have written countless articles on how to raise capital. I have taught thousands of entrepreneurs how to create a great business plan, how to develop a strong financial model, and ways to devise a slide presentation that gets investors excited.
And then, I have written extensively about how to grow your company once you have raised capital. Discussing how to motivate your employees to maximize their effectiveness. And how to find partners that can take your business to the next level.
But there's one thing I haven't written about. One thing that I've totally neglected. And this one thing can increase your effectiveness at ALL of these activities - from raising capital to performing all the tasks needed to grow your successful business.
For this I apologize.
So what is this one thing?
The answer is public speaking, and your ability to communicate ideas to investors, partners, employees and others.
I realized that public speaking was the missing key when I recently reviewed a unique book called "The Power Presenter" by Jerry Weissman.
And, I might not have read the book if it had not received so much praise from venture capitalists. These VCs have relied on Weissman to prepare them to not only raise money for their own funds, but to teach their portfolio company CEOs so they could raise future funding and better grow their companies.
So, why are Weissman's teachings so important? Because, your ability to present effectively and be a great public speaker is critical to your ability to raise money for your business, attract and formalize relationships with key partners, and build a highly motivated team among other things.
And importantly, Weissman's research proves that the content of your presentations is less important than your body language (most important factor) and your voice (next most important factor).
Allow that to sink in for a minute.
What this means is that when you meet with a venture capitalist, angel investor or bank loan officer, your presentation skills are more important than the content of your presentation!
This fact is a bit bothersome to me.
Why? Because it means that an entrepreneur who has great public speaking skills but a poor investor presentation and business model has a superior chance of raising capital than an entrepreneur with a great investor presentation and business but poor communications skills.
But, rather than me pouting about this seemingly unfair reality, let me tell you some of Weissman's keys to making you a better public speaker and presenter.
First of all, to reiterate, the most important thing influencing your audience is visual (i.e., your body language), then vocal (your voice and speaking rhythm) and then verbal (the story you tell).
Secondly, when you present in front of a group, your natural "fight or flight" instincts kick in. Your adrenaline starts pumping and you often get anxious and fidgety. The way that you act as a result of this poorly impacts your audience's perception of you.
To decrease your anxiety, use the following techniques:
1. Practice, practice and practice some more. The more you practice your presentation, the more comfortable you will be when you give it.
2. Concentrate. Just like an elite athlete, you need to clear your mind before the presentation so you can fully concentrate on the task at hand.
Important side note: many years ago, I had the pleasure of introducing entrepreneur and author Harvey McKay at an event. Before he went on, I saw him with his head against the wall talking to himself. I thought it was absolutely bizarre. But he used that technique to focus his mind and pump himself up. The result - he had the audience in the palm of his hand the whole time. It was truly amazing.
3. Shift Your Focus from You to Them. If you give a presentation and your best friend happens to be in the room, chances are that after the presentation the first question you will ask your friend is "How did I do?"
It is this mentality of thinking about yourself that makes people nervous. Rather, focus on the audience. Look at them and think "how are they doing?" This will allow you to present more effectively.
4. Focus on specific people in the audience. Whether there are three prospective investors or business partners in the room, or you are speaking to a room of 50 or 500, you need to visually focus on one person at a time. That is, pick one person to start and complete your first main point. Then you should shift to different people for each key point you make during the presentation. This helps you concentrate better and make sure you are focusing on the audience rather than on yourself.
5. Practice your hand gestures. Hand gestures often positively engage an audience. But, making hand gestures in front of an audience often feels awkward and uncomfortable. You must practice using them with "warmer" audiences (e.g., your friends, co-workers and/or employees) until they become second nature.
Like it or not, your public speaking ability and presentation skills are more important than the content of your presentations. As such, successful entrepreneurs need to master these skills. Use these tips to improve your skills, and remember to really practice all your presentations before the actual event. As you know, in most cases, you only get one shot at key presentations.
To Your Success.
And then, I have written extensively about how to grow your company once you have raised capital. Discussing how to motivate your employees to maximize their effectiveness. And how to find partners that can take your business to the next level.
But there's one thing I haven't written about. One thing that I've totally neglected. And this one thing can increase your effectiveness at ALL of these activities - from raising capital to performing all the tasks needed to grow your successful business.
For this I apologize.
So what is this one thing?
The answer is public speaking, and your ability to communicate ideas to investors, partners, employees and others.
I realized that public speaking was the missing key when I recently reviewed a unique book called "The Power Presenter" by Jerry Weissman.
And, I might not have read the book if it had not received so much praise from venture capitalists. These VCs have relied on Weissman to prepare them to not only raise money for their own funds, but to teach their portfolio company CEOs so they could raise future funding and better grow their companies.
So, why are Weissman's teachings so important? Because, your ability to present effectively and be a great public speaker is critical to your ability to raise money for your business, attract and formalize relationships with key partners, and build a highly motivated team among other things.
And importantly, Weissman's research proves that the content of your presentations is less important than your body language (most important factor) and your voice (next most important factor).
Allow that to sink in for a minute.
What this means is that when you meet with a venture capitalist, angel investor or bank loan officer, your presentation skills are more important than the content of your presentation!
This fact is a bit bothersome to me.
Why? Because it means that an entrepreneur who has great public speaking skills but a poor investor presentation and business model has a superior chance of raising capital than an entrepreneur with a great investor presentation and business but poor communications skills.
But, rather than me pouting about this seemingly unfair reality, let me tell you some of Weissman's keys to making you a better public speaker and presenter.
First of all, to reiterate, the most important thing influencing your audience is visual (i.e., your body language), then vocal (your voice and speaking rhythm) and then verbal (the story you tell).
Secondly, when you present in front of a group, your natural "fight or flight" instincts kick in. Your adrenaline starts pumping and you often get anxious and fidgety. The way that you act as a result of this poorly impacts your audience's perception of you.
To decrease your anxiety, use the following techniques:
1. Practice, practice and practice some more. The more you practice your presentation, the more comfortable you will be when you give it.
2. Concentrate. Just like an elite athlete, you need to clear your mind before the presentation so you can fully concentrate on the task at hand.
Important side note: many years ago, I had the pleasure of introducing entrepreneur and author Harvey McKay at an event. Before he went on, I saw him with his head against the wall talking to himself. I thought it was absolutely bizarre. But he used that technique to focus his mind and pump himself up. The result - he had the audience in the palm of his hand the whole time. It was truly amazing.
3. Shift Your Focus from You to Them. If you give a presentation and your best friend happens to be in the room, chances are that after the presentation the first question you will ask your friend is "How did I do?"
It is this mentality of thinking about yourself that makes people nervous. Rather, focus on the audience. Look at them and think "how are they doing?" This will allow you to present more effectively.
4. Focus on specific people in the audience. Whether there are three prospective investors or business partners in the room, or you are speaking to a room of 50 or 500, you need to visually focus on one person at a time. That is, pick one person to start and complete your first main point. Then you should shift to different people for each key point you make during the presentation. This helps you concentrate better and make sure you are focusing on the audience rather than on yourself.
5. Practice your hand gestures. Hand gestures often positively engage an audience. But, making hand gestures in front of an audience often feels awkward and uncomfortable. You must practice using them with "warmer" audiences (e.g., your friends, co-workers and/or employees) until they become second nature.
Like it or not, your public speaking ability and presentation skills are more important than the content of your presentations. As such, successful entrepreneurs need to master these skills. Use these tips to improve your skills, and remember to really practice all your presentations before the actual event. As you know, in most cases, you only get one shot at key presentations.
To Your Success.
Wednesday, June 17, 2009
invitation
i would like to set up an appointment to get to know more about your group
and how we can work together to help our clients.
We thus take pride in and
are recognized for
developing creative solutions, providing unparalleled
service and funding capabilities in getting the difficult deals done.
Our focus is on
originating, structuring,
advising and acting as equity investor in management-led buyouts, strategic
minority equity investments, equity private placements, consolidations and
buildups, and
growth
capital financings.
As you may know my core business
is helping companies find money for working capital or expansion if you know
any businesses that need help we can also help them find
more cash flow and
eliminate expenses
without firing any employees!
Since
we share common interests in innovation, and the value of networking I
thought I would send you this intro and ask if you would like to connect
for future opportunities to collaborate, learn and share knowledge.
My request is based on personal interest, and a pay it forward philosophy. I
believe
that we can all learn
through and perhaps help one another in some
way through new connections.
Best regards,
thomas duffy
vci llc
president
o 860-350-4440
f
203-648-4942
and how we can work together to help our clients.
We thus take pride in and
are recognized for
developing creative solutions, providing unparalleled
service and funding capabilities in getting the difficult deals done.
Our focus is on
originating, structuring,
advising and acting as equity investor in management-led buyouts, strategic
minority equity investments, equity private placements, consolidations and
buildups, and
growth
capital financings.
As you may know my core business
is helping companies find money for working capital or expansion if you know
any businesses that need help we can also help them find
more cash flow and
eliminate expenses
without firing any employees!
Since
we share common interests in innovation, and the value of networking I
thought I would send you this intro and ask if you would like to connect
for future opportunities to collaborate, learn and share knowledge.
My request is based on personal interest, and a pay it forward philosophy. I
believe
that we can all learn
through and perhaps help one another in some
way through new connections.
Best regards,
thomas duffy
vci llc
president
o 860-350-4440
f
203-648-4942
Monday, June 15, 2009
referrals
I appreciate the conversational exchange this opens around referrals. Having built 7 businesses in 7 industries has given me perspective I don't know I could have gained out of following any one set of approaches. Here are the most, most valuable three tips I diligently practice now.
(and of course, you can't just practice these -- having an actual system you honor and the mindset of inclusiveness and appreciation can also never be replaced!)
1. BECOME the type of referral you SEEK. I am constantly intrigued by those who complain or lament regarding referrals they do not get - who have rarely, rarely even made ONE -- or at most a very few -- lifetime. Gandi cracked this code long ago: BECOME what it is you seek. Reciprocity RULES. It even supersedes all the lofty and often quite expensive of sales-training.
2. STOP practicing "sales" jargon. Who wants to ever be "closed???" How on earth has this lingo prevailed? If you are truly about relationship (which is the root from where sustainable referrals thrive, reside and die) are you not about:
is it not OPENING you really seek??? (vs closing) (duh!)
Just speaking with the whole lingo of "prospect," "closing" etc is very, very revealing about what's really primary and on your mind. Take a hint...people are not stupid and they don't appreciate being prospected. A lifetime, compounding value of the client relationship is what you really want. Why not set it up for that to most often become possible?
Another way you can self-check - once there is no possibility of "a sale" -- what happens in your commitment to staying in touch with those you've also formed real (or you think they are real, right?) relationships? If they go off your radar completely - you may also know why that person is no longer in your sales-zone of possibility.
Here comes Social Media -- word travels fast in this new, more transparent world of easy-pattern-detection.
(in fact, this week I've actually blocked 3 globally known and highly regarded FRIENDS who have constantly used Facebook for literally nothing but pitching "free" stuff with sales sandwiches tucked within the edges of all the bait. One was actually discontinued from Facebook in April, learned nothing, and now back here in May is doing the same thing - just at decreased frequency. That's when i blocked her friendship link also - who needs that kind of friend online? That does not mean i don't still like her - i just don't need to deal with deleting the clutter she's proliferating the space with any longer.
(if you need to know how to block pitch-folk - there is a little window within which to add their name at the bottom-right-hand corner of the Privacy section. Facebook obviously isn't making this easy to locate..being now in the sales and pitching biz themselves.
Whew! end of rant...i love business development -- and i really am aware when folk even unconsciously but consistently forget the relationship element i do believe being we're all ultimately connected - it reflects poorly on the whole arena of business cultivation and maintenance.
3. So...on a more positive note: Almost everyone i've ever know who does not get referrals - who truly IS capable, talented AND appreciative - has simply failed to understand how/who referral NATURALLY works well FOR and with...and it's pretty obvious.
Referrals work best for:
1. that 5% you cannot KEEP from delighting in telling you about everything great they just discovered -- trip destinations, where to shop for xxx, books to read, people to meet, organizations to consider joining, the greatest new movie, the concert by xxx. THOSE are the people who are inherently WIRED to share...and they truly love doing it and do not consider it a cost - but an opportunity.
Now...regretfully, statistically because you have to realize they are also putting their OWN credibility and reputation as being an informed referrer on the line each time - -a small, small percentage love to take that risk. So...we would maybe be wise to let up out of the theoretical headlock of blame ALL those others who are simply not pre-disposed to refer.
There is ONE exception -- probably another 5-10% who genuinely appreciate you and what you provide WOULD be periodic (vs automatic or extremely thoughtful) referrers -- IF, and only IF -- you educate them specifically in how to best do that, make it incredibly EASY for them to do so (give them links, materials, cards - whatever) so they can do it gracefully, tastefully, willingly -- when it is convenient to THEM.
Yesterday, I finally personally MET a woman I've cross paths with at least 10 times in the past year here in Austin. I had NO idea she was actually a PR specialist who GOES to major events with her clients. We struck up a natural conversation easily -- about someone i did not KNOW was her client there at that event - who i really, really admire and who i will also soon be working with myself. She did not know that. I did not know anything else about her -- and yet I recognized immediately due to HOW she implements her business, how well she cares for her clients so personally -- she and i will do business together.
I left the event with 3 more of her cards -- 2 go to former clients of my own - 1 to a collaborator. It will be a sheer pleasure to make these referrals as i know we ALL will win -- and she is a mutually giving referral also, both to me and will be to each of them if she has confidence in their deliverables.
(and of course, you can't just practice these -- having an actual system you honor and the mindset of inclusiveness and appreciation can also never be replaced!)
1. BECOME the type of referral you SEEK. I am constantly intrigued by those who complain or lament regarding referrals they do not get - who have rarely, rarely even made ONE -- or at most a very few -- lifetime. Gandi cracked this code long ago: BECOME what it is you seek. Reciprocity RULES. It even supersedes all the lofty and often quite expensive of sales-training.
2. STOP practicing "sales" jargon. Who wants to ever be "closed???" How on earth has this lingo prevailed? If you are truly about relationship (which is the root from where sustainable referrals thrive, reside and die) are you not about:
is it not OPENING you really seek??? (vs closing) (duh!)
Just speaking with the whole lingo of "prospect," "closing" etc is very, very revealing about what's really primary and on your mind. Take a hint...people are not stupid and they don't appreciate being prospected. A lifetime, compounding value of the client relationship is what you really want. Why not set it up for that to most often become possible?
Another way you can self-check - once there is no possibility of "a sale" -- what happens in your commitment to staying in touch with those you've also formed real (or you think they are real, right?) relationships? If they go off your radar completely - you may also know why that person is no longer in your sales-zone of possibility.
Here comes Social Media -- word travels fast in this new, more transparent world of easy-pattern-detection.
(in fact, this week I've actually blocked 3 globally known and highly regarded FRIENDS who have constantly used Facebook for literally nothing but pitching "free" stuff with sales sandwiches tucked within the edges of all the bait. One was actually discontinued from Facebook in April, learned nothing, and now back here in May is doing the same thing - just at decreased frequency. That's when i blocked her friendship link also - who needs that kind of friend online? That does not mean i don't still like her - i just don't need to deal with deleting the clutter she's proliferating the space with any longer.
(if you need to know how to block pitch-folk - there is a little window within which to add their name at the bottom-right-hand corner of the Privacy section. Facebook obviously isn't making this easy to locate..being now in the sales and pitching biz themselves.
Whew! end of rant...i love business development -- and i really am aware when folk even unconsciously but consistently forget the relationship element i do believe being we're all ultimately connected - it reflects poorly on the whole arena of business cultivation and maintenance.
3. So...on a more positive note: Almost everyone i've ever know who does not get referrals - who truly IS capable, talented AND appreciative - has simply failed to understand how/who referral NATURALLY works well FOR and with...and it's pretty obvious.
Referrals work best for:
1. that 5% you cannot KEEP from delighting in telling you about everything great they just discovered -- trip destinations, where to shop for xxx, books to read, people to meet, organizations to consider joining, the greatest new movie, the concert by xxx. THOSE are the people who are inherently WIRED to share...and they truly love doing it and do not consider it a cost - but an opportunity.
Now...regretfully, statistically because you have to realize they are also putting their OWN credibility and reputation as being an informed referrer on the line each time - -a small, small percentage love to take that risk. So...we would maybe be wise to let up out of the theoretical headlock of blame ALL those others who are simply not pre-disposed to refer.
There is ONE exception -- probably another 5-10% who genuinely appreciate you and what you provide WOULD be periodic (vs automatic or extremely thoughtful) referrers -- IF, and only IF -- you educate them specifically in how to best do that, make it incredibly EASY for them to do so (give them links, materials, cards - whatever) so they can do it gracefully, tastefully, willingly -- when it is convenient to THEM.
Yesterday, I finally personally MET a woman I've cross paths with at least 10 times in the past year here in Austin. I had NO idea she was actually a PR specialist who GOES to major events with her clients. We struck up a natural conversation easily -- about someone i did not KNOW was her client there at that event - who i really, really admire and who i will also soon be working with myself. She did not know that. I did not know anything else about her -- and yet I recognized immediately due to HOW she implements her business, how well she cares for her clients so personally -- she and i will do business together.
I left the event with 3 more of her cards -- 2 go to former clients of my own - 1 to a collaborator. It will be a sheer pleasure to make these referrals as i know we ALL will win -- and she is a mutually giving referral also, both to me and will be to each of them if she has confidence in their deliverables.
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