Growth from within
Senator Bennett's fourth annual rural business conference Part II
|Local artist Karen Templeton unveils a bust of Sen. Robert Bennett at the summit.|
New road to marketing: directing on-line traffic to your business
The internet is changing the face of marketing and Paul Allen was a presenter at the Rural Summit to help business owners and entrepreneurs utilize the internet. Allen is an entrepreneur himself, and a managing partner at Infobase Ventures. Allen explained many free services on the internet to help business owners do the research required to direct customers to their website.
"Businesses can either catch the wave of technology or be pounded by that wave," said Allen. All the new technology is creating a wave of opportunity for those who wish to use the internet as a tool for expanding their business. "Wayne Gretzky said 'I skate to where the puck is going to be, not where the puck has been,' and that is the approach a business owner must take. You need to point your business to where the market is going not where it is," said Allen. "I believe that within a few years all of us will have a high speed internet access wherever we go with whatever device we have."
By 2010, the prediction is that three billion cell phones will be in use. Those phones will provide users with not only personal communication, but movies, internet access, and GPS capabilities, all wireless broadband. The advances occurring in the technological field are revolutionizing the world of commerce. Broadband in cars is also coming quickly.
When a person stops to consider the advances in the technological industry over the past decade alone, it stretches the imagination to think about where it is going. The best guesses are that tomorrow's "wave" will be the high speed mobile devices. Allen stated that high speed, wireless broadband will revolutionize the hand held market.
Allen suggested that entrepreneurs do their research on the internet. Websites and search engines, such as Google and Froogle, can be very helpful tools to identify trends in the buying habits of customers. Also, maps.google.com can be very helpful to locate resorts, hotels, restaurants, and other services while a person is traveling. If your business is one of those services, it could be beneficial to be located on Google. A business owner can upload all his information, whether he is selling a product or a service onto Froogle, which is Google's product search engine. These services are free.
Tivo type technology is also coming to the internet. The impact this could have on commerce is huge. Google can record any television program that uses key words that are typed in and can be accessed at a later date for information. Businesses should have video clips and make sure their company, service or product is mentioned on a TV show. This will allow their name and product or service to be recorded and accessed by interested customers at a later date. Where are the eyeballs and ears of today? That's where your business should be.
"A person needs to stay current with the technology and where it is going. Then ask themselves how can my business catch that wave," said Allen. "Those eyeballs and ears need to see my product or hear about my service."
The new wave of traffic building tactics contains may helpful tools. To direct internet traffic to your website, a web manager should consider using blogging, RSS (real simple syndication) feeds, direct public relations (such as Google news), local searches, and pay per call.
Blogging is very popular. A blog is a personal publishing tool that you can use everyday to comment about what your business is doing and your newest products. RSS feeds allow your blog to get republished by other search engines everyday. Spam is not allowed in blogging due to the fact that most spam emails do not get read.
Another tool is direct public relations. A person can write their own news release and publish it for free on four-five different websites, two of which are prweb.com and press-world.com. If a press release is published on one of those websites, GoogleNews will pick up the information and index it. Anyone searching the web for information about your product will be directed to your information about your company.
GoogleNews indexes items and press releases from 4,500 worldwide news sources and keeps them on file. If a person types in a key word looking for information, GoogleNews will bring up that data. GoogleAlerts is also a free service that a business owner can sign up for that will email them directly if any one of the key words is used. This allows business people to get a handle on where the requests are coming from and what those people are looking for.
Local search engines will also become more popular in the future. These search engines will provide information about local service or product suppliers. Pay per call is another tool that is becoming more popular. This service only bills you for actual calls that you receive for your product.
A popular tactic that is used on websites is the giveaway. The company gives the customer something for free, either for ordering from the site, or referring someone else to the site. This tactic is very effective when used in conjunction with giving the customer something that will allow you to sell your product. For example, if your site sells genealogy information, give the customer free software downloads to enable them to download the information they buy from your site.
There is a valuable website available for entrepreneurs who need funding to begin their project. The website www.fundingutah.com matches people with capital to invest with entrepreneurs who are looking for investors. A person is required to post their idea and implementation plans, and investors can contact those entrepreneurs whose ideas they are interested in.
Use a search engine to spread the word about your company. By using vital keywords when registering with a search engine, your site will be readily accessible to anyone who types in that keyword. Eighty-four percent of internet users use search engines, and very few of those users can tell the difference between a site that is a paid site and a free site. If a site comes up during a search and it offers what they are looking for, they will use it. Also, by using a search engine, results are trackable. A person can access the data that can answer questions as to how many people are visiting your website, how many are purchasing your products, and what that advertisement is costing per buyer.
Finally, provide a space on your site that will allow your customers to give feedback about your product or service. Other customers read these comments before purchasing, and these comments can also be utilized as a means for you to improve your product or service. Allow your customers to talk to each other and post their satisfaction with your product.
Allen summed up his presentation with the guiding principles used in a formula for success. (1) Measure everything. If it is measurable, measure it and track your progress. (2) Read case studies. A person must research everything available that pertains to similar products or services and the strategies that made them successful. (3) Try every marketing tactic. If one tactic does not work for you, try something else. Sooner or later, a successful tactic will be found. (4) Test, test, test. Try many different advertising campaigns and find a successful one. (5) Daily effort. Little things done daily over a long period of time add up to big rewards in the long haul.
In 5-10 years, the world we live in will not be recognizable due to the technological advances, and people will need to catch each wave to be successful.
|Wayne Urie, RC&D director speaks with Patrick Byrne about economic possibilities.|
Eliminate the middleman
What company is growing at 102 percent a year? What company is the largest employer in the country of Afghanistan? Utah based company Overstock.com can answer yes, that's us to both of those questions. The chairman of the board and president of Overstock.com, Patrick M. Byrne, was in Price recently to address Sen. Robert Bennett's rural conference.
Byrne began by telling the audience that he was just a farm kid from Vermont. He told how venture capitalists turned him down for capital for his idea for a business. Byrne became what he referred to as a jobber, buying excess merchandise from manufacturers, distributors, importers and catalog companies and reselling everything over the internet via Overstock.com. When many of the dot-com companies collapsed, Byrne came in to clean up the mess and liquidated 18 failed companies which had been funded by the venture capitalists. Byrne said his father told him when he was a kid, "If you're not going to kick a man when he's down, when are you going to kick him?"
Byrne said, "We buy wholesale, and we sell wholesale, but I couldn't sell anyone on this idea." The company began growing, but Byrne was convinced by some that he needed some expert finance people on board, the "Harvard" type. So he bought in, but profits soon declined and Byrne began to think this had been a poor move, so he cut the entire top of his team and when he was done cutting, he was left with everybody from Utah. Students who were graduates of Salt Lake Community College, University of Utah, and Brigham Young University and things started moving back up.
"We hope to do $1 billion worth of business over the internet this year," said Byrne. Byrne said he has a friend who taught him a lot, Warren Buffet. He taught him about customers and returns and transactions. Byrne told about ebay which started out just selling Pez candy dispensers and has grown from there.
Byrne told of their Club O'Gold part of the business where they can sell in lots to small businesses, restaurant suppliers and others. They have added 100 categories to this portion of the business which enables small businesses to buy supplies cheaper. "This virtual buying syndicate is exploding on us," said Byrne.
Byrne told about the long trail from the producer to the consumer and how Overstock is working to eliminate the supply chain. They buy goods from the producer for more and can turn around and sell to the consumer cheaper which eliminates the middleman. In this manner, Overstock has grown to the largest employer in Afghanistan with 1,700 employees. A division of the parent company called Worldstock buys from local producers. Worldstock has grown by $30 million. Byrne said they are also working with the Navajo nation and have 120 craftsmen and women providing authentic native products. The producers can double and triple their incomes marketing this way. Byrne said they are working in developing countries and looking for entrepreneurs. They have 8-30 people working in a valley in Peru making authentic goods. Byrne said they like working directly with the people making the products. They are also working in Cambodia with potters and weavers helping disabled workers to earn top dollar for their goods. Programs are being initiated in Nepal, Ghana, and Lebanon. Byrne said one of their objectives is getting the money into the hands of the women who work for them, because this increases the quality of life for the entire family.
Byrne answered questions from the audience. One man wondered if Overstock plans on going after ebay? Byrne said they have been developing a system this past year and they are now competing against ebay. Ebay has disaffected sellers and ebay has higher fees which has angered some of their users.
|Patrick Byrne speaks with summit goers.|
"Utah is a fantastic place to do business," said Byrne, "Utah is the most wired state, there is a big difference." He said Utah universities encourage graduates and computer science was stressed in Utah much earlier than other universities across the nation.
Byrne said he runs a very philosophical company which incorporates army rules. Be, know and do. His focus is on the be. The character of a person is important. When he built the company with fancy folks it just wasn't right. "They spun things, lied, but I looked past it, until I realized we were building on quicksand. When I cut 40 percent of the workforce, and scraped up all that was left was a bunch of Utahns," said Byrne.
Byrne said in areas when a Wal-Mart comes in they can buy 10 percent cheaper than wholesale and sell for 10 percent less than retail and it puts small retailers out of business. Byrne said small retailers can buy from Overstock, 30 percent cheaper and keep their prices lower. "It gives small retailers an edge to compete with Wal-Mart," said Byrne.
Byrne said he was glad to hear that Helper was a haven for artists as they are looking for artists all the time. They buy from the artists and if an artist can drop ship himself then they will make more money.
Byrne encouraged anyone wishing to contact him about an idea or with something to sell on Overstock to email him at email@example.com.
Also, artists and those wishing to participate in that aspect to email firstname.lastname@example.org. He said you only need five or more of an item to get started.
A question from the audience about sales tax for internet companies was asked and Byrne said he is against such taxes. Byrne visited with conference goers and Kathleen Truman from Living Utah talked with him about the annual Folk Art Festival held in conjunction with the Emery County Fair and the artisans who display there every year.
The possibilities are endless for the marketing of these local folk art heritage items on the internet.