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7 Things to Plan When Choosing a Third-Party Selling Strategy

seller 7 Things to Plan When Choosing a Third-Party Selling Strategy
Archives, Education, Global Trade Daily, Trade Cycle

7 Things to Plan When Choosing a Third-Party Selling Strategy

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The business landscape is looking better and better for businesses that want to sell online. Morgan Stanley predicts that the global e-commerce market could reach $5.4 trillion by 2026. If it does, that would represent a nearly 64% increase from 2022 figures—in just four years’ time.

This should make you take notice if you’re involved in e-commerce or want to be soon. It’s an enormous pie. Yet getting a slice isn’t as easy as it might seem. There are many obstacles and challenges involved with trying to gain momentum as an online seller. Perhaps the biggest of all is cutting through the noise and getting your organic and paid content seen.

It can be very difficult to work your way up to the top of search engine results. Even if your company already has a little visibility and traction, you may want to take a proven tactic to break into the mix: Move to a third-party selling strategy.

Third-party selling is exactly what it sounds like. Your company sells merchandise via a third-party site rather than on your own site. (Certainly, you can still sell on your own site, too.) The benefits can be huge, but only if you take a little time to plan your approach. Below are several tips to keep in mind.

  1. Study potential third-party seller sites.

Before assuming that any third-party seller is the right fit for your products, get to know what it’s like to partner with the seller. Go on a full-blown investigation, right down to making a list of pros and cons. The more educated you are upfront, the fewer surprises you’ll experience later.

For instance, say you want to get involved with Amazon. It’s a great choice, given that Amazon is the largest third-party selling platform on the planet. Unless you do a deep dive on everything from distributor costs to listings and catalogs, you can’t create a well-informed Amazon marketing strategy first draft. Or, if you can’t spare the time, hire a consultant to help you get a fast education on your top third-party sellers.

  1. Decide how much e-commerce control you want.

Third-party sellers can provide you with a ton of services such as warehousing and drop-shipping capabilities. However, the more services you need, the lower your profit margins are likely to go. Therefore, you’ll want to start thinking about how much control you want to keep. Even if a third-party seller promises lots of add-ons, you may still prefer to keep some processes in-house.

Let’s say you sell a boutique line of women’s clothing. It may be important for you to keep all the packaging and shipping on-site. In that case, you want your third-party to take care of nearly everything up until the fulfillment. From that point on, your team takes over.

  1. Upgrade all dated visual content.

Unless you have superb images of your content, set aside money for better photos. You don’t need to hire an agency or professional photographer, but make sure your products look amazing. People scroll quickly when they’re shopping digitally. You want them to be captivated by what they see.

Some third-party sellers allow you to upload both traditional images and videos. Take advantage of this opportunity. Wyzowl research from 2021 shows nearly eight out of 10 marketers have found a link between video and increased sales. Video gives you the chance to show the product in action, answer common questions, and build some branding. Nothing brings merchandise to life faster than a short but memorable marketing video.

  1. Ensure a third-party platform can sell your products where you want.

You can’t gain as much from e-commerce if you can’t sell to anyone, anywhere. Never assume that a third-party seller can automatically sell your product across international lines. Many companies have ended up surprised by how few places they could sell their products.

Along these lines, be sure your products are even allowed to be sold abroad. Case in point: If your product is made of wood, you may have to jump through hoops to sell it to Australian consumers. This doesn’t mean it can’t be done, but you have to be aware of possible hurdles.

  1. Factor in all the “fine print.”

E-commerce can be extraordinarily effective in ramping up your revenue streams. Unfortunately, countless companies have ended up selling millions of dollars’ worth of products online—only to see very little in terms of profit. Frequently, the underlying reason was that they failed to factor in all the “fine print” costs.

When budgeting as part of your e-commerce third-party selling strategy, always include all the obvious and hidden costs. These costs could be anything from third-party logistics to advertising. Make sure that you’re folding returns into the mix. Touting free shipping and free returns may make people buy but plenty of businesses have found out the hard way that paying for refunds can wipe out margins.

  1. Protect the name of your brand.

Not all companies that sell on third-party sites offer consumers branded merchandise. If you do, plan to protect your brand. Otherwise, nefarious sellers may try to besmirch your brand name through a variety of means, including posting fake negative reviews or flagging your product content. (This is another reason to work with a third-party selling consultant if you anticipate selling millions in merchandise online each year.)

Software programs can help you keep tabs on your brand across digital channels. The more you know about what’s happening with your brand, the easier it will be to shut down issues. In addition to protecting your brand, construct a brand personality and branded content guidelines. That way, everything you put online will have a sense of alignment.

  1. Watch your data in real time.

Watching the real-time developments of your e-commerce sales can feel a lot like watching the stock market ticker. Though you shouldn’t get too scared by dips, you should find a way to stay on top of any anomalies. Those anomalies might not be anything important, but you never know.

You don’t need to ask a team member to stay glued to digital reports. However, you should set up analytics software that can be monitored 24/7. Choose your top KPIs and track them to get a baseline. Once you have your baseline, you can note any variations quickly and, if desired, take action.

Before you think you need to turn your website into an e-commerce store, think again. Third-party sellers have done all the hard work for you. Yes, you’ll pay for their expertise and “real estate.” But with the right planning, you’ll recover your investment in the form of global sales.

Author’s Bio

Jason Streiff is president of Streiff Marketing, which has deep roots in the Amazon seller and vendor space and helps brands succeed on Amazon Retail and Amazon Marketplace.

 

To say business that this year’s MODEX event was widely, if not wildly, anticipated is more than reasonable, given the months it’s been since many
Archives, Global Logistics, Global Trade Daily, International Trade

MODEX UNMASKED

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To say that this year’s MODEX event was widely, if not wildly, anticipated is reasonable, given the months it’s been since many attendees have seen this many faces, masked or unmasked, in a single day. While a few were masked, most presenters and audiences were not. The many exhibitors were upbeat as they shared the latest inventions and processes that are and will be impacting the supply chain. The twitterverse was alive with pictures of tweeters with their “long-lost” friends.

The prime questions at the conference dealt with whether the changes in consumer and supply chain behavior are permanent and, if so, to what extent. The first item was almost universally answered affirmatively, but no consensus existed for the second. Yes, e-commerce is on the rise. Will the same pace of growth exist? Probably not. 

SSI Schaefer’s Saif Sabti, VP Business Development and Strategy, and John Barre, executive sales manager, reported that e-commerce had seen 39% YOY increases but they predicted that growth will slow to something more like 18%-23%. Some 82% of Boomers say they will go back to brick-and-mortar stores, but, even if that happens, it’s not clear if retailers should prepare for changed expectations regarding inventory, payment, and delivery. Millennials and Gen Xers confirm their use of e-commerce will continue. 

If changes in behavior were the underlying issues addressed in 2022, the answer to problems arising from these changes could be summed up in one word:  automation. Automation was presented as ultimately less expensive than human labor, faster than humans—important as the orders increase, and better for the workers who are present. Ergonomics are better if the number of steps workers take and the weight they must transport are reduced. 

Considering MODEX 2020’s panel on COVID, which grossly underestimated its effects, it seems prudent to include here the session that was NOT about a new machine, application, or process. Under Attack:  What Ukraine Means for Global Supply Chains could not have been timelier. Beyond the humanitarian concerns involving the American Logistics Aid Network, its executive director, Kathy Fulton, led this session on business and economic implications. Panelists were Alan Amling, Distinguished Fellow at UT Supply Chain Institute, University of Tennessee at Knoxville, and CEO of Thrive and Advance, LLC, and David Shillingford, cChief sStrategy oOfficer, Everstream Analytics

Amling and Shillingford pointed out that supply chains connect many businesses to Ukraine and Russia. That connection, however, may not be obvious, even to the businesses themselves. Shillingford told us that 90% of the world’s sunflower oil comes from Russia. Why should this matter to us? Because Lays and Ruffles primarily use sunflower oil. Groceries and snack machine vendors are unlikely to have considered this as they assessed the risk the Ukraine situation poses to their businesses. In the case of war and embargoes, items may become more expensive or, worse case, unobtainable. Sunflower oil will be more expensive, and Lays may shift to olive oil or some other alternative. In contrast to the rare earth minerals, recently provided by both Russia and Ukraine, oil is a small problem. Those minerals may be unobtainable, and some have no known substitutes.

The panelists continued discussing risk. They said that businesses know their Tier One suppliers, but few know all their Tier Two supplies, or the Tier One’s of their Tier Twos. This time the disruption in the chain is geopolitical; two years ago, it was medical. COVID-19 infections and/or various governments’ responses to actual infections and to reduce spread have rippled through the supply chain. Weather, earthquakes, and climate degradation are also risks. Back in 2006 in Harvard Business Review, Elizabeth Economy and Kenneth Lieberthal wrote that China lost $31 billion in industrial output due to a lack of water clean enough to run the factories. Amling proposed that companies create scenarios that focus not on the cause but on how their business could respond to disruptions to inputs and outputs.

Compared to war, e-commerce and its implications seem almost simple to manage. Certainly MODEX 2022 displayed solutions to the challenges of too few workers for work that has become more complicated, but must be more accurate, and rising costs for materials, labor, and transportation. Both the educational sessions and the booth conversations pushed the same message. Firms anywhere along the supply chain need to clarify their strategy so they can find and be better partners to the firms with whom they choose to connect.

 

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Afraid to Step Out of Your Comfort Zone? Then You Can’t Lead in the Age of COVID.

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COVID-19 has disrupted the business world, and the “normal” of a few months ago may never return. In this new landscape, how business leaders process and react to new challenges will be crucial.

Using critical thinking skills to make sound business decisions in a complicated, constantly changing world has never been more important, says Dr. Jim White, founder and president of JL White International and bestselling author of Opportunity Investing: How to Revitalize Urban and Rural Communities with Opportunity Funds (www.opportunityinvesting.com).

“Critical thinking in the COVID-19 era will separate effective leaders from the pack,” Dr. White says.

“Before, many of us relied on linear thinking – that is, solving problems in a step-by-step fashion. When life proceeds in an orderly way, we can draw conclusions based on probabilities: this is what happened before; therefore, it will happen again. Or, we use contingency statements: if THIS is true, THAT is true.

“But COVID-19 changed those premises. Now, there are too many unknowns to rely on lazy thinking. The volatile economy is one example: we don’t know how or when the markets will recover. What will the business community look like post-COVID? Will people continue to work remotely, and which companies will thrive and which will crumble? Will entire industries – like cruising – buckle under the strain? How will communities deal with their struggling populations, vacant real estate, and shuttered businesses?

“Now is the time for non-linear (lateral) thinking, characterized by expansion in multiple directions rather than in a straight line. The concept has multiple starting points from which we can apply logic to a problem.”

Dr. White offers the following advice to developing non-linear critical thinking:

Step out of your comfort zone. “Critical thinking requires that we see and interpret information from a different perspective,” Dr. White says. “In our old comfort zones we weren’t necessarily required to make difficult decisions. But navigating COVID requires taking steps to adapt to new circumstances. For companies, it means being nimble, finding opportunities and ways to innovate. It may mean drastically reducing a brick-and-mortar footprint in favor of a digital presence. It may mean dumping obsolete inventory at a discount. Or it may mean lay-offs.”

Dr. White thinks many people have closed minds and don’t adapt well to change. “In military training, one is taught to pivot, to escape and adapt, since there is no such thing as a perfect set of circumstances,” he says. “The species that is capable of adapting well is the species that survives.”

Don’t jump to conclusions. “When jumping out of your comfort zone,” Dr. White says, “be careful not to jump to conclusions as well. Instead, ask questions, and organize and evaluate information. For instance, business owners should be asking, is now the right time to be re-opening? Who says the pandemic is over? Who is cautioning against reopening? What will reopening look like? Coming to a valid conclusion requires studying the available data: what is happening in other parts of the world, the country, or the industry?

“One criterion we rely on is, what do experts say? What are the credentials of these experts? Carefully evaluating data has never been more crucial than during this pandemic.”

Separate truth from belief. “People often have trouble separating what is valid from what is true because of ingrained beliefs, which we all have. This ‘belief bias’ interferes with our ability to think logically,” Dr. White says. “Critical thinking means making decisions based only on data. For business leaders that means putting aside what worked in the past and being completely open to new practices and protocols.”

“In the age of COVID-19, we must embrace challenges and make solid decisions based on critical-thinking principles.”

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Jim White, PhD, author of Opportunity Investing: How To Revitalize Urban and Rural Communities with Opportunity Funds (www.opportunityinvesting.com), is founder and president of JL White International. He also is chairman and CEO of Post Harvest Technologies, Inc. and Growers Ice Company, Inc., and founder and CEO of PHT Opportunity Fund LP. Throughout his career, he has bought, expanded, and sold 23 companies, operating in 44 countries. He holds a B.S. in Civil Engineering, an MBA, and a PhD in Psychology and Organizational Behavior.

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Research Shows These 5 COVID-19 Changes Really Can Help Brands Grow Market Share

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“We’re all in this together.”  “We’ll get through this and emerge stronger.”

By now, the entire nation is familiar with these COVID-19 era mantras that brands are repeating on the airwaves, social media and in stores. But have consumers had enough of COVID-19 communications? And are these messages really helping brands — not just in the moment, but also with the future in mind?

Because emotions drive consumer behavior, we need to look at how consumers are reacting emotionally to each message to answer these questions. From several major studies with thousands of consumers my firm has conducted, we’ve seen that the brands that connect with consumers emotionally and in particular have a positive impact on how a person feels about themself, are the ones that are most likely to be purchased in general. We’ve also seen that during this period when people’s work and personal lives have been upended and worry, stress, frustration and anxiety are running high, companies that make consumers feel better are the ones that will gain market share and be recommended during and after the COVID-19 pandemic.

Product offerings are one way to make people feel better. Brands are certainly stepping up to the plate by providing products and services that help people feel better by fulfilling a need for indulgence, self-care and control.

Just as importantly, though, is what brands are saying and doing.  Messages of togetherness and reassurance—such as in State Farm’s Ad announcing, “For now, we’re all living a new normal…we’re here to make this new normal feel just a little more normal,”—are indeed helping. So are the actions that back these messages up, such as offering 0% financing, delivery and generous return policies.

Some actions and messages are more effective at making people feel good than others. They’re the ones that will help move the needle as far as retaining and growing market share. In a study of 1,000 consumers, my team and I uncovered the following 5 things brands are saying and doing that increase the chances of purchases and customer loyalty now and in the future by making people feel good:

Saying we will get through this and emerge stronger

A full 70% of those we polled said that since the start of the COVID-19 crisis, they have developed a more positive opinion of brands that remind them “we will get through this and emerge stronger.” Two-thirds (66%) say they will definitely purchase the product when this crisis is over, and 45% say that hearing this makes them feel very good about themselves. Of course, there are different ways to convey this message. Guinness ads acknowledged that St. Patrick’s Day was going to feel a bit different this year, adding, “we’ve learned that over the years, we’re pretty tough when we stick together” and “we’ll march again.” This Coca-Cola ad reminds us that for every loss, there is a gain, that for all the scaremongering there is also care mongering, and for every virus, there is a vaccine–implying humans are ultimately positive and resourceful.

Offering exclusive hours for at-risk groups

It makes good, practical sense that numerous retailers such as Whole Foods, Target, Walmart, Publix and Stop & Shop are offering special hours to those who are most at-risk of contracting the virus such as the elderly because these groups are less likely to leave their homes to make purchases.  But these actions and the messaging behind them are also helping from a short- and long-term marketing perspective.  Four-fifths (80%) of the people we polled said they have developed a more positive opinion of brands that offer exclusive hours for at-risk groups since the COVID-19 crisis began.  Almost three-quarters (73%) say they will definitely purchase from these providers when this crisis is over.

Reminding consumers that we’re all in this together

This is another phrase we are hearing from brands over and over again. In just one example, Hershey’s recent ad Heartwarming at Home begins by saying that we’re in this together and that these experiences give people a chance to come together in meaningful ways. It ends with pictures of people connecting through windows, several feet away, and with family members at home, sending a clear message: you’re not alone.  And it’s working.  Of the people we surveyed, 73% said that since the start of the COVID-19 crisis, they have developed a more positive opinion of brands that remind them “we are all in this together, while 67% say they will definitely purchase the product when this crisis is over. Hearing this makes 42% feel very good about themselves.

Sharing reliable updates about the COVID-19 situation

Apple has released a new screening tool that allows people to determine if they potentially have the virus and if they should seek medical care. They created a new COVID-19 website and app with the CDC to help them understand how to manage the virus, and a Contact Tracing App with Google to help curb the virus’ spread. Quest Diagnostics’s website provides information about COVID-19, and consumers can sign up for email alerts for news and testing information. Although it’s helpful in the moment, being a resource for consumers is also likely to pay off over time: 81% of the respondents said they’ve developed a more positive opinion of brands that share reliable updates about the COVID-19 situation, 49% say that purchasing from such brands makes them feel very good about themselves, and 60% say they will definitely purchase from these brands when this crisis is over.

Reminding consumers to take care of themselves

Surprisingly simple messages such as Uber thanking people for staying home and not using their service, and Sesame Street explaining that “taking care of yourself is also taking care of others” during a campaign that features Elmo and three friends washing their hands to upbeat music are proving extremely effective for brands. A full 77% of those polled said they’ve developed a more positive opinion of brands that remind consumers to take care of themselves, and 57% say they will definitely purchase from these brands when this crisis is over.

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Anne E. Beall, PhD is the CEO and Founder of Beall Research, Inc, a marketing-research consulting firm that uses research to create solutions for Fortune 500 companies. Author of Strategic Market Research: A Guide to Conducting Research that Drives Businesses (3rd Edition) and 7 other books on reading body language, gender dynamics, human-animal relations, and fairy tales, Anne previously worked for the Boston Consulting Group (BCG). She received her MS, MPhil, and PhD from Yale University. A lover storytelling and walking, Anne lives in Chicago.

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Putting Purpose Above Profit: 3 Steps to Drive Long-Term Results in Times of Uncertainty

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Purpose, by its nature, is defined as the reason for existing and goes beyond making money. It is about people coming together to make an impact in something they believe in with the trust that revenue and growth will follow, rather than as an end in itself. To be a  ‘purpose-driven’ organization, companies need to stand for something and look to positively impact society. “Innovation cannot advance in a positive direction,” Marc Benioff, CEO of Salesforce recently said, “unless it’s grounded in genuine and continued efforts to lift up all of humanity.”

Here are 3 steps to re-capture your purpose to drive long-term results in these uncertain times:

Go back to your WHY.

Now, more than ever, companies need to revisit and return to their purpose /  WHY / core values. During hard times, leadership is forced to make quick and tough decisions. By going back to their purpose, each choice can be tied to the long-term vision of the company and help avoid costly short-term/knee-jerk decisions. “So many businesses are lost right now. At BirdEye we are focused on navigating these uncharted waters by focusing on our core values  – customer obsession, family spirit, world-class and innovation.” said President & COO, Dave Lehman “Purpose-driven results are measured by the impact we have on our customers and partners. That way, we can all get through this together.”

Connect employees with a vision they can believe in and embrace.

As leaders quickly pivot a company’s direction and change priorities, the stories and reasons behind the change matters. When teams and individual contributors understand how their roles fit into the company’s WHY, everyone feels part of a greater good and can own the company’s key messages. Executives can’t be connected with every customer directly, so it’s critical to empower employees with a foundation to go and expand the brand. Research by Bain & Company shows that if a satisfied employee’s productivity level is 100% and an engaged employee’s level is 144%, the productivity level of an employee that is truly inspired by the company’s purpose is an impressive 225%.

Show empathy and advise with humility.

Emotionally connect with your customers and focus on how they are managing in this time of great uncertainty. Ask the personal questions and be willing to spend time sharing your personal stories first. Selling in this environment is about doubling down on fixing their problems and addressing their concerns rather than pushing your products or services. In these unprecedented times, authentically connecting and helping your customers is the only way to drive business. For example, IKEA wants “to create a better everyday life for the many people” and Southwest Airlines strives to “‘connect people to what’s most important in their lives.”  In essence, a company should be selling their vision and aligning their purpose with their customers. Human beings need to feel connected. People will remember how we act today more than any product or service they buy from us.

Businesses that embrace the idea of purpose and profit being intertwined are companies that will drive innovation and achieve long-term success. Leadership needs to communicate more than ever that we are in this together, reinforcing that the company is truly a community that shares the same core values.

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JANEL DYAN is a well-regarded executive brand strategist and expert on how to build a story to achieve brand alignment for both company and leadership success. She founded Janel Dyan, Inc. (JD) in 2014, which provides transformative brand strategy and style consultation to high-visibility clients across various industries. Her work has been seen by millions through public experiences at Fortune 500 companies, the United Nations, and the World Economic Forums, among others. Dyan also runs Beyond Us, which provides opportunities to build confidence in women through a platform for sharing clothes with other women who are ready to take the next step in their professional lives. Dyan resides in the San Francisco Bay Area with her husband and two sons. Her book Story. Style. Brand.: Why Corporate Results Are a Matter of Personal Style, is available now.

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How to Use Invoice Factoring to Improve Your Business Cash Flow

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Cash flow can be difficult for a business to manage effectively. When you wait 30, 60 or 90 days for payment of work already completed, expenses don’t wait with you. They need to be paid now.

But you aren’t at liberty to change payment terms you agreed to with customers. If you try it, they’ll just leave you to find another company that will work with their terms.

Let’s look at a cash flow example. Say you own a small trucking business with a fleet of 5 trucks. The trucks are assigned as collateral to the company that financed them.

Business is good. You have experienced drivers and your trucks haul for great customers who pay well. But paying well does not mean paying quickly.

Yet you have truck payments, fuel, maintenance, insurance, taxes, payroll, and other overhead. You find yourself burning through cash before you get more.

You don’t want to lose your drivers or your trucks. And you’d hate to lose your customers to competitors. But debt is not an option; the trucks are already financed. If only you could get paid quicker.

Then you hear about invoice factoring and how it can smooth out cash flow. You decide to give it a try.

How Does Invoice Factoring Work?

Invoice factoring is not a new concept. It’s been around for centuries. It is selling accounts receivable to get cash for your business.

In the example of the trucking company above, when a load is delivered and the customer is billed it creates an account receivable. But the customer doesn’t pay until the agreed upon terms. That long wait time puts stress on the business.

With invoice factoring, instead of billing the customer, you sell the invoice to a factoring company. The factor then pays you an advance of up to 98% of the invoice value.

The advance you receive depends on the agreement reached between you and the factoring company. That advance is paid to you within 24 hours or less.

The factor bills the customer and waits for payment. Once your customer pays the factor, the remainder is paid to you minus a small fee for factoring.

Instead of waiting long times for payment, your business receives cash immediately after transmitting each invoice. Now the trucking company has the consistent cash flow to carry on hauling freight. As long as you deliver loads, you’ll have the cash right away.

And the factoring company takes on the billing and collections. No more trying to manage accounts receivable and no more spending time trying to collect on them. The factor does it all for you.

How Invoice Factoring Can Help Grow Your Business

Now that the trucking company has improved business cash flow it’s time to focus on growth. Meeting all your expenses on time, having extra money on hand, and saving time and money on accounting services frees you up to take on more work. Here are 20 easy ways trucking companies can increase their profit margins.

Your customers are happier than ever that you’re so dependable, always delivering on time now. They offer you additional loads. Instead of turning them down for lack of cash to operate, you jump at the opportunity.

You begin to add more trucks, more drivers and more trips. And your business is thriving, all because you improved your cash flow by invoice factoring.

And the more your business cash flow grows, the more your factoring grows with it.

Is it Hard to Qualify for Invoice Factoring?

No, not at all. You don’t need a high credit score. In fact, it doesn’t matter if you have bad credit. With factoring you’re not borrowing so your credit is not important.

It’s the credit worthiness of your customers that matters. As long as your customers have good credit and a strong history of paying you will most likely qualify.

That’s why invoice factoring is a great idea for those new to the business and/or having a low credit score. Factoring is getting paid on work you’ve already done. It’s your money; you earned it. You just get it without having to wait. The factor does the waiting for you.

Invoice factoring is also good for businesses that are thriving but experiencing interruptions in cash flow. Getting paid immediately on invoices can really improve business cash flow and reduce the stress caused by long payment wait times.

If you’d like to improve business cash flow, reduce accounting costs and grow your business, you owe it to yourself to look at invoice factoring. It’s used by all sorts of businesses, not just trucking.

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Rachel Donaghy is the Senior Director of Account Management at eCapital.com. eCapital is building a brighter future for the transportation industry. It’s a future where freight companies get paid at the click of a button. Where document exchange becomes data exchange. Where complexity disappears into the background and drivers have the freedom to focus on delivering the next load. You can find Rachel on LinkedIn and Twitter.

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Eleven Big Brand Mistakes Companies Regularly Make

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Whether or not you realize it, brand is tremendously important to every aspect of your business. A well-crafted and well-executed brand strategy can cut through the noise of a million messages, articulate your promise to the customer, set you apart from the competition, scale your business, and establish yourself as a leader in the space.

Problem is, most leaders underestimate and neglect their brand. Even those who think they know brand inside and out often have big misconceptions or serious flaws in their strategy—and in this case, what they don’t know can hurt them.  

Misunderstanding brand leads to costly mistakes. Only by recognizing common missteps and avoiding them can you fully realize the power of a strong brand and put your business ahead of the competition.

Brand should be a company’s North Star. It should guide every decision you make. Forging an ironclad brand lets you occupy the single best position in the hearts and minds of your customers. When you pinpoint this optimal position, you’ll be able to create value, maximize scale, and lead with purpose.

On the other hand, a poorly crafted and executed brand position can seriously cost you. Read on for a list of mistakes that too many companies regularly make:

MISTAKE #1: You don’t claim your brand position at all. Instead you let the market do it for you. Position happens whether or not you are driving it. If you allow yourself to be positioned by the market, it most likely will not be your optimal brand position for growth. So, the number-one mistake is to underestimate the importance of brand positioning by not intentionally claiming your brand position at all.

Don’t be an accidental brand. It’s too important. A business’s brand can either unleash your competitive advantage or thwart it.

MISTAKE #2: You delay on brand strategy. Ironclad brand strategy is not just for established businesses with traction. It is also for start-ups. The sooner you have a brand strategy, the sooner you’ll have both your North Star and your rudder. Know your purpose now—you can always revisit it later as your product gains market fit and momentum. As with any business, you will refine your direction as you learn more about your customer, the competitive space, and your own strengths as a business.

MISTAKE #3: You focus on the category benefit of your product. Assuming you do participate in careful brand positioning, the most common business pitfall is choosing a positioning idea that is not ownable and differentiated. Many businesses pin their brands on a category benefit or “table stakes”: a benefit that is not only not unique to the market, but is a must-have for anyone in the space.

If you sell a pancake mix (and your brand isn’t dominant), it’s vital to avoid relying on table stakes like “comfort food on Sunday mornings.” Instead, you have to focus on something that only you bring to the pancake experience. Identify the things you are particularly good at (maybe your mix is healthier than the others, or you deliver a traditional Swedish-style pancake). Then isolate which of these are unique in the market. Finally, determine which of these resonates with your target audience.

MISTAKE #4: You don’t recognize the vastness of brand. Lots of people misunderstand brand because a lot of different components and tactics make up brand. It includes things like logos, advertising, TV and social media, the product itself, customer experience, tagline, SEO, font, your business’s personality, and even the color of your employees’ uniforms. But none of these are, by themselves, brand. Brand is the interconnected web of what your business means and how you deliver that meaning, all made possible by your special position in your customer’s universe. 

To conflate brand with one of its many manifestations is to miss its power.

MISTAKE #5: You don’t choose a focus. Brand strategy includes choosing what you are NOT going to focus on (even though it is scary). By choosing what falls inside your brand purpose, you are also choosing what falls out of it. Focus is how you win. You must muster the courage and effort to undertake this heavy-lifting strategic work.

Choose to stand for something—one thing. In choosing your “yes,” you necessarily choose many “noes.” Shining the light on one thing darkens what lies outside that beam.

MISTAKE #6: You fail to get the customer’s attention. A customer can engage with your business only when she knows it exists. That means you must make it easy for them to notice you. The solution isn’t to shout loudly (and most lack the marketing budget to shout loudly enough). The solution instead is to speak with bracing clarity, which most businesses fail to do. Be crystal clear about what your business is and why that matters to customers.

A storefront near my office failed to get my attention. Its windows featured women clad in fleece tunics, and the signage was vague and New Age-y with an obscure tagline. I assumed that this business sold crystals and incense, so I was surprised to learn it was a Pilates studio. I practice Pilates and am in the middle of this business’s target customer profile. But this Pilates studio failed to make their business easy for me to see, so I did not see it. I did not become a customer because they did not make it easy for me to do so.

MISTAKE #7: You forget to consider the customer’s frame of reference. A frame of reference is that thing your customer would be using if your product or service didn’t exist. It’s what they would buy instead of your offering. Businesses tend to think about their frame of reference from the business’s perspective, instead of from the customer’s perspective. This is a huge missed opportunity.

It’s easy to know your most persistent direct competitors. But remember that your target is evaluating your offering in the context of other competitive options—both direct competitors and more elusive ‘substitutes.’ Therefore, it’s important to consider your brand positioning with respect to all other options your customer might choose, including direct competitors, indirect competitors, and options completely outside of your space. 

When it came out in 1975, Atari sold zero units at a toy industry trade show because it was priced at $79, an astronomical price point for the frame of reference of “toys.” It wasn’t until they contacted Sears, which sold a very successful home pinball machine for $200, that they sold 175,000 units by the end of the year. By distributing their console as a home sporting good, they were in a useful context for the customer—and they had a compelling price point.

MISTAKE #8: Your brand doesn’t have “teeth.” Your brand strategy must be demonstrably true. It must have the power to make people believe it, trust it, and follow it because it offers compelling proof that it will live up to its promise—in other words, it has teeth. Those teeth can be an attribute, a feature, a fact, a guarantee, an ingredient—any special thing the brand offers and follows through with that provides its promise. The less debatable, the better.

Look at Zappos, a brand that represents best-in-class customer service. That is no squishy promise, because specifics back it up. For example, Zappos displays its phone number on every page of its website. And when you call it, a live person answers and seems genuinely glad you called. The Zappos promise of customer service has teeth.

MISTAKE #9: You fail to narrow down your target customer. Your target customers are the people you want to attract more of. They are the people you are most able to delight because of your distinctive strengths. Most businesses characterize them in a superficial way and end up describing little of their inner world. Instead, characterize your target customer as a subtle and empathetic picture of how they view themselves. Remember that identifying your target customer does not eliminate your larger addressable market!

Picture your customers as sprinkled across a dartboard. The full dartboard is your addressable market. You sell to the whole dartboard. The bull’s-eye is your target, the customers you must aim to please the most. The target customers in the middle will ideally influence the customers on the outer circles of the dartboard.

MISTAKE #10: You wind up too low or too high on the benefit ladder. A benefit ladder spells out the layers of your benefits from product features and specifications at the bottom, to functional benefits in the middle, to emotional benefits at the top. Savvy leaders choose to shine the spotlight on the rung of the ladder that is as high as their customer currently permits them to go, but no higher. The higher the better, until it is too high. The common errors here are choosing emphasis on the ladder that is either too low (features and product attributes) or too high (the intangible, ethereal benefits).

If you are too low on the ladder, features will not create high enough value for your customer that she will be moved to buy and pay meaningfully for your offering. When your focus is too high on the ladder, you are not providing accessible scaffolding for the customer to believe your promise. The linchpin of a ladder is its middle. The middle is low enough to be accessible to the customer—sharp-edged, believable, rationally easy-to-grasp. Focusing on the ladder’s middle enables you to deliver substantial value, gain a sizeable and defensible position, and appeal to emotions.

MISTAKE #11: You try to reach all customers with one-size-fits-all messaging. There are five stages of a customer’s journey with your brand: Unaware, Aware, Consider, Purchase, and Loyal. Your goal should be to craft a messaging hierarchy for customers at every stage of the journey. Unfortunately, many people are tempted to develop a sentence or paragraph so great that it will serve all your purposes—all stages of the journey. Resist the temptation. There is no one magic message that will advance all customers at all journey stages.

Further, it’s a mistake to conflate stages of the journey, either coming on too strong too soon (conflating the Aware or Consider stage with the Purchase stage) or bragging about your product features to someone not yet liking the promise (conflating the Consider or Purchase stage with the Loyal stage). Take your fences one at a time.

It’s never too late to brush up on brand and start making better choices for your business. Don’t let past mistakes derail your future success. Even if you recognize yourself or your product or service in every common mistake, you can still turn things around by making changes that will help you thrive starting today.

About the Author:

Lindsay Pedersen is the author of Forging an Ironclad Brand: A Leader’s Guide. She is a brand strategist, board advisor, coach, speaker, and teacher known for her scientific, growth-oriented approach to brand building. She developed the Ironclad Method for value-creating brands while working with billion-dollar businesses like Starbucks, Clorox, Zulily, T-Mobile, and IMDb, as well as many burgeoning start-ups. Lindsay lives in Seattle with her husband and two children.

For more information, please visit www.ironcladbrandstrategy.com.

About the Book:

Forging an Ironclad Brand: A Leader’s Guide (Lioncrest Publishing, April 2019, ISBN: 978-1-544-51386-7, $27.99) is available at bookstores nationwide and from major online booksellers.

Archives, Global Trade Daily, Special Reports

3 Tips For Creating A Clear Vision To Ensure Business Success

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Running a business is similar to taking a family vacation. To be successful, both require meticulous planning, clearly defined roles for everyone involved, and a predetermined destination.

“Not having a clear vision and specific goals is a proven way to ensure you’ll never achieve them,” says John Collopy, author of the book The Reward of Knowing (www.johncollopy.com). “That’s why articulating your vision is a critical first step toward success—to give yourself something to aspire to besides some general idea of ‘making it.”

Collopy knows a thing or two about having a vision and then setting goals to make the vision a reality.  He is the owner and broker of RE/MAX Results and its subsequent 38 offices across Minnesota and Wisconsin. Setting goals in his personal life helped him overcome his addiction to alcohol. Now he is dedicated to helping others find the right steps to achieve their dreams, but he says there can be many roadblocks.

“Having an unclear vision can also make it difficult to stay motivated and passionate about your work,” says Collopy. “Identifying a clear vision and set of goals can keep us going through tough times, and give us energy when we want to give up. That’s because, even when you’re in a rough patch, you know you’re working toward something.”

In contrast, a vague, half-formed vision may leave you feeling lost and powerless, he says.

“Eventually, you may even give up entirely,” Collopy says. “You may decide that, based on your record of failure, success just isn’t in the cards for you. And that’s the saddest result of failing to articulate your vision.”

Collopy has the following tips for those who are ready to set goals to achieve their vision:

-Be specific and realistic. Be specific about your goals, and the steps you need to take to reach them. “If you don’t, be ready to deal with challenges now and in the future,” Collopy says. Also make your goals attainable but not too easy. You want to have pride when it is accomplished. If you set the bar too high, you may get discouraged.  And if you set it too low, you will not feel a great sense of accomplishment. 

-Make goals measurable. Any good goal that is worthy of your time should be measurable so even if you don’t make it, you can measure your progress. It will be easier to measure your goals if they are clear goals that are attainable, relevant and time-based.

-Write it down and tell someone. Write down your vision, make copies and leave those copies where you will routinely see them – on your refrigerator, in your car, on your dresser, in the bathroom. “This will remind you about your vision throughout the day and keep you on task,” Collopy says. In addition, the more people you tell about your vision and your goals, the better. They will encourage you because the next time they see you, he says, they will probably ask you about your progress.  

“Once you have attained your goal, take some time to celebrate your victory with your team,” Collopy says. “Even if the goal wasn’t a team goal, invite others that work with you or for you to share in your accomplishment.”

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John Collopy, author of the book The Reward of Knowing, is the owner and broker of RE/MAX Results and its subsequent 38 offices across Minnesota and Wisconsin.  With annual sales of more than $5.3 billion, RE/MAX Results is now one of the largest RE/MAX franchises in the world.  Collopy lives in Minnesota with his wife and children.

Archives, Commentary, Global Trade Daily

What Is Your Definition Of Success? 5 Tips To Find It.

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While building and maintaining a thriving business may not be easy, experts in entrepreneurial endeavors say that building a personal brand first is key. In fact, some studies show that today’s consumers trust big brands less and prefer buying from a person they view as authentic and relatable. But before building a personal brand, it’s important for an entrepreneur to define what constitutes their own brand of success, says Ngan Nguyen (www.nganhnguyen.com), an intuitive strategist and author of Self-Defined Success: You Have Everything It Takes.

“Fulfillment and extraordinary results only come when you strive to achieve your authentic success,” Nguyen says. “The key is figuring out what that is and navigating that path. The good news is that we each already have everything it takes to navigate that path. It is essential, because we each have unique gifts, passions, and talents that can create amazing impact in the world and differentiate ourselves and our businesses.”

Nguyen offers five ways to define your own brand of success that can lead to running a successful business:

Get unstuck by unleashing your inner self. “We feel stuck when there is a lack of clarity and the path in front of us is not aligned with our authenticity,” Nguyen says. “Stagnancy and negative happenings force us to look inside ourselves at who we really are and what we really want. Detail those things, and now you’ll have the blueprint to create change and growth. Getting clear on this enables us to lead ourselves and our business to forge ahead on a new path.”

Act on your new authenticity. “Our full potential comes out when we are fully committed to creating a result that fully expresses who we are and what we love,” Nguyen says. “Without that clarity and without acting upon our newly discovered authentic selves, there will always be a bit of reservation. And with that reservation comes lackluster results that are not a reflection of our true potential.”

Keep the vision in mind. Nguyen says much of our untapped potential lies in unused intelligence. “Leaders who leverage their vision can effectively navigate a path to success in a competitive marketplace,” Nguyen says. “Any vision that we can imagine, this infinite intelligence knows how to bring about. The question is how we go about influencing our subconscious in the right way so that it serves us. We do this by holding and keeping an image of a life we desire, and feeding it through repetition long enough that our mind goes to work to aid us in creating it.”

Make your passion your fuel. “The power to create extraordinary results requires this critical ingredient,” Nguyen says. “Passion is contagious, ignites the heart, and motivates the team. It energizes and sparks the pull forward through all barriers, uncertainty, and challenges.”

Have the will to make decisions that move toward your dream. Nguyen says the difference between those who make their dreams happen and those who don’t isn’t always a matter of intelligence but often is a matter of consistent will in decision-making.

“You must have the intention to keep moving forward,” Nguyen says. “There is an energy shift that is experienced in the decision-making process, where a desire goes from wanting to being because you’ve concluded that the dream must come true no matter what.”

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Ngan Nguyen (www.nganhnguyen.com) is the author of Self-Defined Success: You Have Everything It Takes, and the founder/CEO of Cintamani Group, an executive coaching and consulting firm. Nguyen coaches on leadership and empowers entrepreneurs as an intuitive strategist. With over a decade of business strategy experience as an advisor to Fortune 100 companies, Nguyen is also a certified master-level intelligent leadership executive coach with John Mattone and was an analyst for McKinsey & Company. Nguyen graduated with a double honors degree in biochemistry-biophysics and bioengineering from Oregon State University and completed a research fellowship at MIT in nanotechnology.

Archives, Commentary, Global Trade Daily

Three Risks of Buying a Business & Profiting off the Opportunities they Create

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Why start from scratch when you can get a great deal on what someone else started?

In today’s sexy startup culture, buying an existing business has lost its vogue. But every year thousands of entrepreneurs become millionaires by buying and growing businesses without the startup headaches of venture capitalists, zero revenue, and no business processes.

If you like the idea of being the sole business owner, improving an okay business and taking things from good to great, buying a business is probably the best opportunity for you. Since every reward comes with risk, I have put together the top 3 risks I see first-time small business buyers face, the profitable opportunities they present, and the diligence to find these opportunities.

Risk 1: The business owner IS the business

The risk:

The owner of the business is a lynchpin. They make all the sales. They manage all the customer relationships. The employees depend on their expertise and training. If you remove the owner, the business struggles and collapses.

The opportunity:

Use this as a negotiating point when bargaining for the deal. If the business IS the business owner, then that person needs to be part of the deal. Structure the buy-out to include an employment contract or consulting agreement, as well as an earn-out. That way the ex-owner is incentivized to hand-off their knowledge and help you succeed.

The diligence:

Interview customers, vendors, and employees. Listen to if they mention the business owner’s name more than the business name itself. Ask employees questions about their job and see if they know the answer, or if they look to their boss for the answer. Review the org chart for an ops manager and sales person who have been in the business a long time.

Risk 2: The employees will flee after change of ownership

The risk:

You buy the business and all the good employees get scared and quit.

The opportunity:

Use the change in leadership to inspire hope and motivate. Or, determine who is holding the organization back and needs to go. Firing bad employees will make the good ones optimistic of a turnaround. For the good ones, challenge them to help grow the company and incentivize them to stay through promotions, profit sharing, or equity.

The diligence:

Work with the current owner to identify key employees. Be your own judge of this, in case the owner is downplaying any key people. Sales, engineering, and operations are typically critical areas. Meet with key employees in advance, if the owner permits, to discuss their ongoing role in the organization and align expectations. You’d be surprised how simply listening to and reflecting the feelings of employees will make them feel more comfortable and taken care of! Ask about the company culture and decide what parts to keep. They may also give you keen insights about the strengths and weaknesses of the company.

Risk 3: Running out of cash

The risk:

You base your purchase price, valuation, loans, and cash forecast off historical financials, only to find out a few months into owning the business that the numbers were all wrong and you are losing cash.

The opportunity:

Negotiate a better price on your deal with findings in a due diligence report. Use the cash forecast in the report to secure better terms on your business loan or lock the owner into seller financing. You can even persuade the seller to pay for the cost of accounting clean-up or bad inventory.

The diligence:

Hire financial professionals to help with your due diligence. This team will research key areas like unpaid payroll taxes, incorrect accruals, bad inventory accounting, and other ways owners can exaggerate their financials, either intentionally or by accident.

Turn these risks into opportunities by performing smart diligence, and you too may become one of the small business millionaires without starting from scratch.

LJ Suzuki is a fractional CFO with CFOshare, an outsourced finance and accounting department for small businesses.