I’ve interviewed many successful business owners over the past decade and there are a few things that businesses who make a profit even during recessions have a few things in common.
According to Mike Bova, Publisher Madison County Courier, author and motivational speaker, “Retention is more important than any other factor in business. When your customers have a new account representative every week, they lose confidence in your business.”
Mike is also very well versed in web marketing in the form of SEO, pay per click and other high-tech strategies. Mike actually launched a business during this recession, grew it online then after a degree of success went into a print format. He basically reverse engineered a newspaper company. This reverse engineering is becoming more popular since the cost of owning and updating a website is much less expensive than launching a print version of the newspaper, store, etc. This can be tricky though since you are using the website as a primary function and mission critical tool more than just an add-on, which is how most business manages view their site.
When you launch a business with primarily a website, you have to know how to generate traffic, get into the search engines effectively and generally weave your site into the fabric of the Web.
Making your Internet Business Recession Proof
If you are a Web-newbie, you might want to think twice about launching with the website as a primary source of leads and launch a more brick and mortar business, then slowly transition onto the Web. My last interview with David Lisi, Founder Life and Homes, taught me a lot about how to recession-proof business and in a nutshell, the answer is multiple, recurring, even competing revenue streams.
David’s business model uses one primary revenue stream from what I will call ‘Platinum’ relationships with lenders, while the six other streams based more upon ads and content, produce a smaller revenue, but they provide a smoothing effect where one stream might be down, yet two or three others are up. This smoothing effect provides a more stability in rough times. So, what was the key to success for David Lisi and Life and Homes? As a result of me having interviewed David many times over the past ten or so years,
I have come to the conclusion that his success is due mostly to the fact that he has faith in people and that by constantly “tweaking” his offering, he evolves rapidly to meet the needs of customers.
Small Business Has To Shift Quickly
The one big thing a small business has to offer is resiliency. The only way to beat bigger and more established businesses is to be open to new ideas, invent your own solutions and systems and have faith in people. How many times has your local newspaper said if you can’t afford to pay for your ad this month, just get us paid next month and we’ll keep the ad running? About never is the likely answer. I know for a fact that David Lisi has said that exact thing to at least one of his customers. Invention, evolution and faith are David’s primary tenants.
One of my best interviews of the year was with a young techy entrepreneur (techtrepreneur) named Andy Kurtzig, founder of JustAnswer.com and eBenefits. Andy had a perfect mix of business intelligence as well as the ability to code, or program, his own tools. This combination of technical knowledge and entrepreneurial spirit is really what the next generation of business founders will have. More so than analyzing the degree a new business founder might have, investors would be wise to do more due diligence on how the business founder can invent his own software, evolve older software or just simply market himself, or herself, on the Web.
The one thing that is better than the ability to sell a product is a product that has the ability to sell itself. Andy is a great case study in entrepreneurship since he has the two talents that are critical in this new economy. Andy took the concept of a YAHOO Answers(sm) and made it more like you were going to a real professional rather than somebody who just claims to be a professional. Also, one thing many entrepreneurs have in common with each other is the fact that they had a need to fulfill; they filled the need for themselves, then turned that solution into a marketable product or service.
Necessity really is the mother of invention. It’s not just a saying, and in Andy’s case his wife was pregnant and he had a list of questions he wanted answered for her. Well, like a true entrepreneur, Andy realized that there might be many more people with similar questions who would like to ask a real doctor, but don’t want to visit the doctor and that this service would have a value associated with it. So, JustAnswer was born. Andy now has experts in topics who generate six figure incomes just from answering questions in one or two categories in his site. The main factor for JsutAnswer is that if you claim to be a certified auto technician, you really have to be certified. Also, all answers are checked before being delivered so there is a quality control process involved.
I have not yet interviewed or been given permission to use his full name, but another young techtrepreneur by the first name of Matt, used his programming capabilities to build a guitar tuner and used the existing iTunes network to sell the tool. He produced a significant revenue model, but he didn’t need to market or sell anything. The product, through iTunes, sold itself. Taking the economy into account when you sit down and try to plan a business launch is mostly useless. First of all many businesses start as a result of a layoff, so you can’t really decide when to start your business, many time the decision is made through the actions of other people and circumstance that cannot be controlled.
Is a Recession The Best Time to Get Started?
A bad economy might be the exact time when larger, sluggish and slower o react businesses have trouble and become easier to gain their customers by explaining that you cost less, you can do more, you’re more passionate about your business and the bigger business has lost its way and no longer cares about the customers individual needs. We also hosted a book author panel about writing your book, publishing the book and then, the hard part, marketing your book.
Book authors are as much entrepreneurs as they are writers. Most people are not aware of the fact that even if you have a publisher for your book, they actually do very little to market and sell the book. As an author you are a self promoter and self marketer. Book authors are as much a business person as they are an author, unless they don’t want to sell books. Our book panel was well received and we will do it again in 2011, probably in Q1.
Rob Thrasher researches and writes about High Tech, Life and Homes and Business Success: SpotLight on Success Radio that airs on BlogTalkRadio, Live265 and LifeandHomes.com reaching over a quarter million media consumers. To book a speaker on topics covered by Rob visit the CyberVillage Social Network.
Rob is the producer and host of the SpotLight on Success Radio Show which airs in BlogTalkRadio, Life and Homes Magazine and CyberVillage Radio about four times monthly. Find the show by Googling CyberVillage Radio. With over a quarter million media consumers and growing Rob interviews successful business people like Andy Kurtzig, serial entrepreneur and founder of JustAnswer.com. Join us to learn what fuels the success of our guests. The show is available in iTunes and hundreds of other places. The show is currently honoring former military business founders.