Selling Technology To Small Business: 7 Insights From Top Innovators

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Selling Technology To Small Business: 7 Insights From Top Innovators

 


I had the opportunity today to attend a conference held by Longworth Ventures Partners.  Longworth is a VC firm here in the Boston area. 

The most interesting session of the conference for me was “The Internet Empowering Small Businesses”.  The speakers for this session were very impressive:  Jana Eggers, Director of the Intuit Innovation Lab, Gail Goodman, CEO of Constant Contact and Robert Keane the CEO of Vista Print.

Of course, Intuit needs no introduction.  Jana herself is impressive and very thoughtful on the topic of what it takes to successfully build and sell products for small businesses.  Gail Goodman is someone I have heard a lot of good things about  over the past year (she’s on my list of people I would love to have as a HubSpot advisor some day).  Her company, Constant Contact has created an immensely successful product for do-it-yourself email marketing.  By any measure, the company is a phenomenal success.  Last, but not least, Robert Keane, the CEO of Vista Print has basically built what by all accounts is a money-printing machine.  The company went public earlier this year and now has a market cap of over a $1 billion (yes, that’s billion with a “B”).

As you might guess, I’m really impressed with all three of these speakers (and I’m not an easy guy to impress).  Could not have hoped for a better line-up for this particular session.

7 Insights From Top Small Business Innovators
 
  1. Ease Of Use Is Critical:  This should not come as any big surprise.  Each of the companies represented emphasized how important it was to ensure that the product is simple and easy to use.  Ease of use helps both at time of customer acquisition and as the company starts to scale with volume.  Problems with usability lead to all sorts of other problems (not the least of which is higher attrition rates and higher support costs).

  1. Experiment Continually:  One of the most intriguing comments by two of the companies was how much time and energy they spent on experimenting with the business to figure out what worked and what didn’t.  Vista Print went so far as to run controlled tests to see what kinds of things impacted conversion rates, abandon rates – and ultimately purchasing patterns.  Vista Print seems to be doing a particularly good job of this and has a highly analytical approach to figuring out the drivers of their business.  

  1. Contact Info Provides Reassurance:  One of the companies stated that customers buy twice as much when they have some way to contact them (phone and/or email).  The reason is that when small businesses are trying a new technology, the fact that they have access to someone for help is sufficient reassurance for them to continue the process.  The result is higher completed sales and more “up-sells”.  Of course, not many people actually contact the company, but just having the ability to helps.

  1. Psychographics vs. Demographics:  Traditional approaches to segmenting customers based on demographics is not as effective as doing so by psychographics.  For example, a small business owner who is a “corporate refugee” will often manifest behavioral patterns that are much more like a big business.  This is because their prior experience in a big company causes them to run their small business with some of the same ideas and concepts.  Another small business owner, in the same industry, might have a completely different approach to her business.  Understanding the psychology of how customers think helps determine why they buy – much more so than coarse-grained segmentation based on demographics.

  1. Terminology Is Important:  When dealing with small organization, it is important to convey your message using terms that resonate.  For example, Constant Contact sells to non-profit member organizations (like trade associations).  In this case, the concept of “email marketing” doesn’t resonate that well (they don’t feel like they are marketing) and they don’t think of their constituents as “customers” or even “clients” – but as members.  Expressing your ideas in the terms of the organization to which you are selling helps.

  1. All Roads Lead To The Website:  When Constant Contact does its own marketing, it makes sure that all of its “calls to action” ultimately lead to the website.  From there, the focus is on converting these leads to customers.  By ensuring that they have a consistent “path” from their various marketing channels to a single point of entry (their website), they can keep their customer acquisition costs down.

  1. Direct Customer Feedback:  All three of the companies were emphatic and passionate about the need to get “direct” feedback from the customer.  Intuit takes this to the extreme by not having “focus group” meetings, but actually visiting the customers where they work and watching how their software is used (or not used).  


If you found this article of interest, let me know (a vote on reddit or digg is a great way to do this).  I have another potential follow-up article describing lessons from one of the other sessions at this conference (on the topic of Enterprise Web 2.0), but don’t want to write it unless there is sufficient interest.

Posted by Dharmesh Shah on Wed, Oct 04, 2006

COMMENTS

I agree that point 4 is critical "Psychographics vs. Demographics" and suggest that persona's provide a practical way to guide teams to think of customers in narrower, behavioral ways. The term "corporate refugee" suggests this thinking process. Persona's can be heavy or light-weight, based on deep research or culled from experiential knowledge and provide concrete guidance to feature choices. No application can be everything to everybody. A tight list of personas drives away from the ill-defined everybody to a well-understood somebody.

/andrew

posted on Wednesday, October 04, 2006 at 11:00 AM by Andrew Lavers


6. ... Constant Contact ...
Fscking spammers!
By mentioning this scum sucking company, you've lost credibility.

posted on Wednesday, October 04, 2006 at 12:17 PM by Glo


Dharmesh - Great post! I agree completely, especially on the psychographics point. I've been focused on that for years.

You should ask certain key questions like these. "Who comes to your site?" "What do they want to do?" "Why do they want or need that?"

Most sites and systems are designed from a non-user point of view. This is like the sales mistake of selling on features, not benefits. In sales you need to sell the benefits. In sites and systems you need to focus on what problem(s) the user is trying to solve and let the architecture and functionality flow from that.

Each different group of users or visitors has different needs and concerns. You should address them directly. I think all sites should be designed around these groups with potentially a very different approach for each group.

In a corporate web site you have lots of different intnerests to serve: casual visitors (explain to them who you are and what you do); interested prospects (explain the problems you solve and why you are better than the alternatives); possible investors (explain your organization, history, leadership, financing history, openness to investment, etc.); users (provide info on upcoming releases, support, knowledgebases, downloads, etc.); senior management at prospects (interested in how professional and competent your org is).

Within the prospect group you should also address subgroups. All prospects are not the same. Ask yourselves the same questions again. Who comes here? Why? What do they want or need?

Most sites are guilty of this mistake. Of course that's not a good reason to continue doing it.

You can gain a considerable competitive advantage by understanding your target sub-audiences and their unique perspectives and needs. At the very least most organizations have the following types of prospects:

A - New to the market - try to educate them about the space and frame the problem(s) they are likely struggling with. Often they do not understand the issues well, let alone the possible solutions;

B - Somewhat knowledgeable first time buyers - If you educate category A correctly, you have turned them into category B types. Now the task is to explain the advantages of your service, product, or system. Remember sell on benefits first, then you can offer info on the features that provide those benefits.

C - Experienced users who are unhappy with their present system/product/service. For this group you want to position your offerings against the competitive landscape. You can educate these visitors on the general types of alternatives and how your approach is superior. A competitive feature matrix might be appropriate. Remember to sell the benefits though.

D - Decision-makers - these are dimension of the types of visitors. For decision-makers you want to provide a direct action-oriented info like extensive details on features, support, pricing, ordering, etc. Decision-makers want details.

E - Influencers - These folks want to know if you are credible. They will either agree to using your system, disagree, or abstain. Make sure your info contains lots of supporitng materials like press coverage, external reviews, corporate history, success stories, etc.

F - Potential End-users - these folks are worried about migration, ease of use, and specific hot-button issues.

G - Managers - these folks are mostly concerned about whether this will be easy to implement, adopt, and admininster. Will it provide a solid return on investment? Does it solve a real problem?

You get the idea. FAQ's are valuable because they focus on the question at hand. Psychographic segmentation is like FAQ's taken to an extreme. It get's inside the head of the visitor or user and orients the information to their unique interests and needs.

posted on Wednesday, October 04, 2006 at 12:33 PM by Daniel Endy


I believe call to actions are critical. I would also ad follow up. Constant Contact and Go daddy, are good at contacting you when your account has been deemed" dead". I think that small businesses some times need to be led to the water, as we are doing a hundred things and technology might not be at the fore front of our minds. I also like the personalization of having my own rep and contact person. I am new blogger and have recieved my own rep from CC, I have been upsold ( in a good was) as a result.

posted on Wednesday, October 04, 2006 at 5:48 PM by Kimberly


It's nice to see someone who's addressing the specific needs of the small business owner. I read some where that stated small business owners like "do-it-yourself" unless it comes to the nitty-gritty details. Areas like accounting for instance, they'll do the normal day-to-day functions but at the end of the month they'll send their data to an accountant. The same can be said for technology. They like to setup their own PCs (sometimes), but when it comes to something more complex like system security, they prefer to outsource.

You are correct, it does have to be easy to use. They don't like to feel intellectually inferior. Your third point is is interesting about contact info. I've been to some sites where it's nearly impossible to find someone to contact. I avoid buying from them totally. I never knew the stats about them finding that more comfortable but seldom used.

Nice info. Thank you.

posted on Saturday, October 07, 2006 at 6:19 AM by Tom Raef


Don't forget geographics. Many people living in different parts of the US use different brands, have different needs, and look for different solutions.

posted on Saturday, December 09, 2006 at 2:50 PM by Small Business Software Rx



Vistaprint might find a new challenge with the advent of video recording using a browser

Examples can be seen in the FREE Video Business Card section ofwww.isendout.com -- register then click VIDEOBIZCARD

Its free

posted on Monday, February 19, 2007 at 10:30 PM by Mike McGuinness


www.hypronex.com has professional website design services geared toward small businesses.

posted on Wednesday, February 28, 2007 at 10:14 PM by Roger H.


great article, one thing i would add is credible references from experts and influences. Most small business owners will seek reassurance that they are not chasing a fad, if you can get some credible folks to endorse the product, it will pay dividends. Secondly, I think samples for different industries works well. They will ask you how have you helped people like them. Remember that only marketers and vendors think of them as small business owners, they think of themselves as financial advisers, wine makers, event planners etc., etc.

posted on Thursday, April 05, 2007 at 3:06 PM by Hasan Luongo


I agree that point 4 is critical "Psychographics vs. Demographics" and suggest that persona's provide a practical way to guide teams to think of customers in narrower, behavioral ways. The term "corporate refugee" suggests this thinking process. Persona's can be heavy or light-weight, based on deep research or culled from experiential knowledge and provide concrete guidance to feature choices. No application can be everything to everybody. A tight list of personas drives away from the ill-defined everybody to a well-understood somebody. 

posted on Sunday, July 19, 2009 at 11:33 AM by sohbet


Vistaprint might find a new challenge with the advent of video recording using a browser

posted on Sunday, July 19, 2009 at 11:36 AM by yonja


Comments have been closed for this article.