Does your website make buying easy?

I recently visited the website of a local retail outlet/visitor centre to look for information about Christmas events, opening times and so forth.

Hard to believe it, but I had to hunt around for this information – and even when I found it there was nothing about seasonal offers. And yet this company spends a lot of effort on making its retail outlet vibrant and welcoming.

Websites need to be more like their retail counterparts. With the vast majority of visitors leaving after viewing just one page, it's critical that the landing page (usually the homepage) does the job.

There are four questions people ask when they land on a website, and you need to answer them. Fast!

1. Who are these people?
Transparent contact details, a real address and phone number, photos of actual people who work for the company, or of the premises... all of these help in building trust.

2. What are they selling?
Sounds obvious, but is it? Ask a handful of people who don't know your business to take a look and give you their opinion.

3. Why should I stick around? (or, what's in it for me?)
The big one – how many sites have you seen with 'Welcome to our website! We are the largest provider of X in the country, servicing blue chip clients to the highest standards of blah... our excellent record is second-to-none...' etc. Who cares? I want to know what you're going to do for me, how you're going to solve my problem!

4. What do I do next?
When time is short, we like to be told. Think airport signs and announcements. How annoying is it not to be able to find crucial flight information? Tell us what to do! Clear instructions, calls-to-action, active verbs (shop now, buy now, find out here...)

Putting yourself in the shoes of your customer is good old fashioned marketing. What are they likely to be looking for when they come to your site? What's on their mind? How can you get their attention in those few second before they click away?

Make buying easy

If there's one mantra worth keeping in mind at all times, it's this. As Steve Krug said, 'Don't make me think!'

So many sales are lost because of clunky navigation, too-clever copy, design-gone-mad and 404 errors. Get rid of the splash pages and the broken links, fix the forms, the spelling mistakes and the black backgrounds, upgrade to a decent content management system and make buying easy. And have a happy Christmas!



Robin Houghton of Eggbox Marketing is an online marketing specialist and author of eTips: monthly marketing advice and ideas for small businesses. Sign up at eggboxmarketing.co.uk/etips.

Should you be spending money on marketing during a downturn?

A study showing the long-term benefits of maintaining an advertising presence during a recession.


There's no denying it, small businesses are having to rein in their costs, thanks to the current economic climate. What does that mean for marketing? Should business owners be cutting that too?

The answer partly depends on whether you consider marketing to be an expense or an investment. Related to this is whether or not you're measuring the results of your marketing. If you can measure it, do so. If you can't, how else are you justifying the expenditure? Ask not what will happen if you do spend £XXXX on a new brochure, website, display ad, directory entry, PR event or whatever, but what will happen if you don't. Not just 'are they cost-effective?' but 'are they effective?'

This question of measurability is key, and it's something that marketers traditionally have always hated. Accountants slashing their budgets, stifling innovation and growth. Marketers believe you have to invest in creative marketing in order to create a competitive advantage. I'm a marketer myself, and I do think it's short-sighted to make swingeing cuts in marketing during a downturn, however tempting, because marketing now is an investment for the future. Nevertheless, there's no point fiddling with marketing while the business burns. The idea is to market smarter – DON'T drop all marketing but DO question every pound spent, keep any eye on the results and stay flexible. Then marketing pays its way and nothing is wasted.

For example, a mail order firm used to send out its sixty page brochure twice a year, with smaller versions in between. Instead, they took the decision to send only one brochure a year and in between times send frequent email updates, attracting customers to their web store. The money saved in print, design and distribution costs was significant, even after the business reallocated budget to the email updates and improving website visibility.

It can be the small changes that make all the difference: halve your print advertising and put the money saved into getting your website found in searches, reconsider those annual directory entries – do they actually bring in business or are you just in them because everyone else is? Look at ways of retaining existing customers and cross-selling rather than focusing solely on getting new customers. Measure what you can: conversion rates, click-through rates, cost per acquisition... it's amazing how many businesses know nothing about their website performance except the number of 'hits' it gets. And most importantly, respond to changes and make the most of any opportunities. We all need to stay on our toes.



Robin Houghton of Eggbox Marketing is an online marketing specialist and author of eTips: monthly marketing advice and ideas for small businesses. Sign up at eggboxmarketing.co.uk/etips.

IDEA over RASCIL?

Following on from yesterday's post on the power of RASCIL in print advertising, we present to you an alternative view on writing the perfect persuasive copy for your product or service, nicely wrapped up in the mnemonic 'IDEA'.

Interest
Desire
Enthusiasm
Action

Interest
In the first instance the interest of the reader must be gained before there is the possibility of making a sale. The main methods of gaining the readers interest include:

- Unique selling point: car and van MOT’s just £35
- Self-interest: sale, 20% off with this advert
- Curiosity: something new, something different

Desire
The next stage is to create 'desire' – this is done by imagery and giving details to explain the offer and/or information about the product/services offered.

Enthusiasm
The ad should now encourage the customer to call/visit the business today, not tomorrow. This is done by the use of selling phrases.

- "Buy now whilst stocks last"
- "Yours for only £..."
- "Call now for details"
- "Offer ends in five days"

Action
Now the ad has gained the readers interest, created desire and enthusiasm to buy, the reader then needs to know how they can contact the business.

- Name and address (including map)
- Opening times
- Telephone number
- Web/e-mail address


Whether it's RASCIL or IDEA, Friday-Ad knows its stuff when it comes to print advertising. Why not give us a call on 0844 871 6604, or e-mail our sales team.

If you are a business owner, why not share your experiences (good or bad) with print advertising? Please leave your comments on the blog, or e-mail us at businessblog@friday-ad.co.uk.

RASCIL: improve your print ad response

Despite the rise and rise of online advertising and it's importance for small businesses (more on this to follow in due course), there is still a place for print advertising.

Print advertising - using Friday-Ad and other newspapers, magazines etc - can be a great way of getting customers 'through the door', but only if your adverts are saying the right thing.

The costs of print advertising can be quite high, so you need to make sure you are maximising the response which in turn will help you to analyse the ROI (Return On Investment).

Adverts that contain all of the information required to make the customer decide to respond to you are valuable to you, otherwise it's a wasted opportunity (and a waste of your money).

One way to ensure that you are including the right information in your ad is to follow the rules of R.A.S.C.I.L. Here's a quick summary of what this is and how you can use it to help create the right advert for your business. Please note that some of these things may not apply directly to you, but can be adapted to suit...

Reliability
Authorised products and services
Safety and Protection
Completeness of service
Illustrations
Location

Reliability
People buy from people they trust, so mention how many years you have been established, size of firm, locally owned etc.

Authorised products and service
These are things that give the customer confidence. Use brand names, certificates and qualifications, credit card logos and mention if you are an 'Authorised Dealer'.

Safety and Protection
These help to prove to the customer that they cannot lose out - things like guarantees/insurances, licences/certificates and memberships of trade associations.

Completeness of Service
State what your USP or Unique Selling Point is. List your products and services and show the process the customer can expect from beginning to end - Pre-purchase advice, personal service and after-care advice.

Illustrations
Images can bring adverts to life and make products real. Use product pictures, photos of staff, buildings, vans etc, company and other logos.

Location
This is all about where to find you and how to get in touch. Use maps, landmarks, directions, parking, address, phone number, email, Skype address and website URL.

To find out more about creating great print adverts that work call the Friday-Ad team on 0844 871 6604 or email us. We offer a free advert design service as well, so you give us the content from above and we'll create you an eye-catching ad.

E-mail marketing: top tips to attract click-happy readers

A recent mailout from our sister site UKBike.com

After a long day at the office, coming home to an inbox full of irritating advertising will have you reaching for the delete key quicker than you can say 'spam'. E-mail marketing, therefore, is an exact science. A quick web search will bring up a host of marketing gurus who offer tips for successful mailout campaigns, such as Dave Chaffey; not to mention the abundance of agencies who offer to deliver your message effectively to the right people on your behalf.

That's not to say that e-mail campaigns cannot be created in-house. Done correctly, e-mail marketing is a very cost-effective tool in communicating with customers old and new. The return on investment (ROI) rate for e-mail campaigns remains consistently high, as small businesses discover the most effective techniques in content and layout to convert a humble e-mail address into a paying customer.

Mailouts require skill and intrigue to ensure that your latest campaign isn't one step away from the Deleted Items folder, as these tips demonstrate...

Familiarity breeds contempt
The contempt from the recipient will be particularly venomous if you continually bombard customers with six e-mails a day. It's the old pestering problem, and if you're constantly keeping your client base updated with all sorts of trivial information, it's akin to a kid pestering a parent on the road with "are we there yet?" Bombarding your customers into submission isn't going to work, while a crisp, to-the-point e-mail every once in a while may win them over in the long run.

Creativity isn’t a crime...
Most marketing e-mails are boring, and the majority of recipients will lose interest after the first few lines. Make it stand out from the crowd – a quirky approach that subtly hammers home the point might just be the tonic. Needless to say, a well-crafted subject line that avoids spam keywords such as 'free' and 'money' will go a long way to grabbing the recipient's attention.

...but stay on message
Is your e-mail relevant to the recipient? Is he or she really going to care about the great work your company is doing in the community? Study trends and feedback to discover what it is your recipients want to know. One often-overlooked technique is to apply Google's Analytics tracking tool to the links within your message, as demonstrated here by Dave Chaffey; this provides a thorough report on how the e-mail was handled by the recipient, information that can be vital in planning future mailouts.

Finally, data collection
Put simply, you need to find out how many people subscribe willingly to your mail list. Plenty of people might 'drop in' to enter a competition, but it is more effective to target the more pro-active user base, those who are most likely to be converted into regular customers.

There are plenty of e-mail marketing resources online, and we certainly recommend a look at the walk-through guides provided by Business Link, The Messaging Times and EmailTools.co.uk.

Do you own an SME that has created your own e-mail campaigns? Have you used any particular software or agencies, and if so, how effective were they? As ever, the Friday-Ad Business Blog wants to hear your experiences – please leave your comments below, or e-mail us at businessblog@friday-ad.co.uk.

Time for some networking

Today's post features the first of many articles written for this blog by a business expert from the Sussex area. First up is Robin Houghton, a marketer with over twenty years experience, based in Lewes.



Time for some networking

Business networking, love it or loathe it? If you're groaning already, I promise this won't be a thinly-veiled promotion for a membership association. But here's the thing. Businesses are having a hard time of it right now and when the going gets tough, like it or not, the tough get networking.

I have a bit of a Jekyll and Hyde thing about networking. On the one hand, I absolutely believe in the principle of it – people do business with people not other businesses, it's not who you know it's who knows you, blah blah.

But I also acknowledge there's something contrived about getting together with the sole purpose of doing business, whilst going through the polite motions of small talk. All that bonhomie with complete strangers, awkward sales pitches and 6am starts - is it quite, well, British? Even my local chamber of commerce seems to view the idea of members promoting themselves to each other as positively grubby.

For my own part, I've done the formal business breakfasts, the informal get-togethers and quite recently had a taste of speed networking. What works? It depends on many factors, not least of all your personality, the type of business you are in and the make-up of the group you attend.

When considering the more formal membership groups, the two biggest issues to square are the cost (both of joining initially and the regular meeting fees) and the time commitment (often every week, with no time off for good behaviour.) In my experience, those who are almost guaranteed to do well in these groups are in 'commodity' businesses (something that most people will always need, like stationery suppliers, accountants, solicitors). They also suit outgoing types (although if you are on the shy side it can build up your confidence about standing up and speaking to a group, for example). The focus of this kind of group is on getting sales leads for one another, so although the time commitment may seem high there is a full agenda at each meeting and no time is wasted.

However, if your business is something more unusual, or your market somewhat niche, or if you have a strong aversion to smiling brightly at 7am, speaking in public or adhering to rules, you will probably be happier with informal networking. Turn up if you feel like it, wear what you're comfortable in, talk to who you like, have a drink and if you hate the hard sell, just be sociable.

Of course, even informal business networking carries its unwritten rules. Don't talk about yourself all the time, for example – far better to turn the spotlight on the person you're talking with. American business etiquette consultant Phyllis Davis offers many useful tips.

A word of warning though: it's a bit like brushing your teeth. Once or twice a year and you may as well not bother. You may not go to every meeting, but try to get along as regularly as you can, because it's the repeated, regular contact with people over the long term that seems to really bring results.



Robin Houghton from Eggbox Marketing is an online marketing specialist who also runs the informal networking group First Friday Lewes.

Pleased to meet you

Hello and welcome to our Advice For Small Businesses blog. Our aim is to provide small businesses with a wide range of information related to marketing, advertising and promoting your business.

The blog is run by Friday-Ad, a well-known classifieds publisher that has been helping Sussex businesses to gain customers for over thirty years, both with our publications and our website, Friday-Ad.co.uk. Our experience gives us a really good insight into how small businesses can benefit from using a variety of advertising and marketing methods in order to maximise profit.

As well as advice, we'll be posting regular news items, plus interviews with marketing and business experts from the Sussex area. And it doesn't have to be us doing all the talking - each article allows you to post your own comments, so feel free to leave your thoughts and get involved with other readers.

Make sure you bookmark this blog or use our RSS feed to check for updates.

FSB chairman John Wright - BBC interview

John Wright, national chairman of the Federation of Small Businesses, spoke to the BBC on Sunday about the credit crunch and the new £12bn Europe-wide fund that will go some way to keeping the 4.5 million UK-based small businesses in operation during the current economic climate.

Social networking in small business - worth a go or fruitless?

It's a fair bet that at some point you've opened your inbox to find an invitation to join in the fun of social networking, an Internet phenomenon that has worked its way into public consciousness largely through word of mouth and an abundance of press coverage. Whether you enjoy being poked on Facebook, love discovering new musical talent on MySpace or have revealed your deepest secrets on Twitter, it seems that the craze for social networking has taken over the world. It's no wonder the business community is looking to how it can get in on the act.

It's easy to see why aspiring businesses would be enticed by social networks. Earlier this year it was revealed that there were over 14 million users of Facebook in the UK – and considering the huge range of information that Facebook captures from their users, surely this is a simple, effective platform for nabbing new customers?

Sure enough, Facebook offers Social Ads, a comprehensive marketing service that matches companies to specific demographics through targeted advertising. Picking out niches from millions of users is a skill that Facebook have honed well, thanks to their subtle use of detailed user profile information right down to favourite television programmes or relationship status.

However, the efficiency of Facebook's advertising services has been called into question. The reality of social networking is that people log on to be social; they are not there to click on adverts. The likes of Facebook and Bebo succeeded initially by offering a simple, fun place to interact; bring a corporate presence into the equation and users tend to not be interested.

This doesn't rule out social networking as a valid business tool. Many small firms have set up 'pages' with Facebook that act as a one-stop resource for company news and latest product offers; you can attract 'friends' to your page and send them information by e-mail, but the page can be seen 'publicly' and so does not require the reader to have a Facebook membership. A good example of a company page is WeCanDo.biz's Facebook presence.

The reality of social networking though, much like that other new-fangled business tool of blogging, is the constant time and energy involved in getting off the ground, interacting with online friends, and most importantly, keeping your online presence fresh and updated. Also, some businesses suit social networking more than others; Facebook, MySpace et al are still predominantly used by younger, net-savvy audiences, although the demographic is changing as more older users give social networking a go.

Those gurus of innovation, Google, may have pushed social networking for small business forward when they launched Friend Connect back in May. By simplifying the technology into 'widget' form, Friend Connect makes it easier than ever to bring the functionality of social networking to your own web pages, in theory converting your visitors into 'friends' who are inspired to regularly return to your web site.

I'll leave the full explanation to Google, but in summary, Friend Connect has the potential to work in a local business context. Imagine collecting 'friends' who are then alerted to new products or services; in turn they can provide feedback on the product, as well as pass on the news to other 'friends'. At the time of writing, Friend Connect still hasn't been formally released for public use, but when it does surface we will hopefully follow-up will a detailed analysis.

While some may think muscling in on the social networking phenomena is a necessity, it's also important for them to remember the primary reason why people enjoy these sites – the enjoyment factor. That's where subtlety becomes important; sure, online tools are more accessible and exciting than ever, but businesses need to connect with the trends of the day without it changing the face of their own day-to-day business.

Talking to Businessweek, leading web expert Peter Delgrosso from web.com gave his tu'penny worth on the social networking debate:

"For the most part, these social networking sites should be viewed as complementary to your online presence. Think of it as a nice-to-have, not a must-have. When used properly, it is something that can gain your business some attention. However, you need to realise it shouldn't be seen as a replacement to your traditional online presence."

While most businesses have pushed ahead with plans to capture the attention of the internet generation, it seems the jury's still out for some. We will cover social networking in more detail in the coming months; in the meantime, if you have used these tools as part of your company's online presence, then please let us know your opinions by leaving us a comment below, or via e-mail – businessblog@friday-ad.co.uk.

Dot com donuts: learning from past mistakes

In these times of economic woe, it's worth casting our minds back just ten years. The Spice Girls were slogging their unstoppable industry around an unsuspecting world, to the joy of soft drink and doll manufacturers everywhere. James Cameron's Titanic well and truly dodged the iceberg at the Academy Awards, sweeping up a staggering eleven Oscars. And in the business world, it seemed everyone was falling over each other for a piece of the 'dot com' pie.

The story was a simple one. The explosion of the Internet from the mid-1990's onwards heralded a new platform for business. Start-ups were straightforward; attract a nice sum of investor cash, buy your dot com domain, splash out on extravagant headquarters full of colourful iMacs and space age furniture, then launch yourself with a fanfare and lay the marketing on thick. 'Growth over profits' was the philosophy – revenue may trickle in slowly, but once the brand and customer base expanded, the money would come flooding in.

It seemed that anybody with a little entrepreneurial flair and a brilliant idea joined the race to take the web by storm. Obviously, hindsight is a wonderful thing, and today it is easy to understand why the bubble burst. By 2001, businesses were tumbling in a sea of anti-monopolisation lawsuits, lavish excess, dubious bookkeeping, unemployment and a more realistic re-assessment of the markets.

Even if business is tough in the current financial conditions, it's highly unlikely to get much worse than any of these web disasters...

Boo.com
This site is commonly touted as the biggest web flop of all time, collapsing after the failure of the dot com boom. Set up in 1998, the company was set up to sell branded fashion to the masses. The owners managed to get through £125 million in just six months, and the company continued to haemorrhage money until its inevitable liquidation in May 2000. Boo was an early warning sign for the pitfalls of web business.

Flooz.com
One thing's for certain, this idea had plenty of flawz. The website aimed to market a new, universal online currency that would take the hassle out of online transactions. It seemed like a good idea at the time, but the wheels quickly came off, leaving websites like PayPal to acknowledge its failings and create a more viable alternative.

Kibu.com
They say patience is a virtue, and how the makers of this particular website must now look at their lack of foresight in not keeping this community website for teenage girls going. Long before the days of Facebook, Bebo and MySpace was Kibu, but before it was ever given the opportunity to realise its potential, the owners got cold feet and pulled the plug after just two months. The biggest mistake since Gerald Ratner's infamous speech?

Kosmo.com
If something seems a little too good to be true, it probably is, and that was certainly the case with this snack home delivery service. You can't fault the ambition of this project – to deliver everything from food to videos to your door within one hour – but the scale of the plans just proved too arduous for this business, and after getting through £150 million with little market impact, the delivery vans slowed to a halt.

Furniture.com
The aim of online stores is to minimise fixed costs, so it's anyone's guess as to what went through the minds of the developers of this website. After spending £40 million on marketing, it seems clear someone forgot to 'do the maths' – as up to half of all revenue was spent on shipping costs. Flawed from the start, it's a great example of how not to go about online retail.

E-commerce has blossomed since the start of the decade, with the UK online retail market valued at £4.8bn by this July. Web-based small businesses starting out today benefit from the lessons of the dot com boom and bust. Investors demand strong, realistic business plans instead of just a good idea; whilst online marketing and commerce tools are more ubiquitous, cheaper and easier to use than ever in reaching out to potential customers, something we will cover in a future article...

Do you own a successful web-based business? How has the web helped you to attract custom from the local area and beyond? As ever, please get in touch with your stories and thoughts by using the comments function below, or e-mailing businessblog@friday-ad.co.uk.

Word of mouth - an oldie but a goodie

Last year, Marketing Week claimed that just 14% of regular (print, radio, television) advertising campaigns had any effect on consumers who are now too savvy to fall for the sales pitch. Whilst many household names have immersed themselves in high-profile web and mobile-based campaigns, it's no surprise that some have gone back to good old human verbal interaction.

Global brands such as Sony, Nestle and Volkswagen have all focussed on generating a buzz from the bottom up in recent years, sending samples of their latest products to 'agents', ordinary citizens who have signed up as guinea pigs through services such as BzzAgent. This particular matchmaking organisation is becoming an emerging force in modern day advertising, boasting just under 500,000 agents participating in 430 product programmes both here and in North America.

The theory behind BzzAgent is straightforward. Agents are randomly assigned samples to road test (usually theirs to keep) on the condition that they provide feedback to the manufacturer, and more importantly, discuss the product with friends, family, and anyone else who will listen. It's a fairly transparent form of marketing; agents are asked to make it clear that they are participating in a campaign, and no money changes hands. The aim is to put the fledging product into social circulation, and while the manufacturers anticipate glowing reports from their guinea pigs, agents are more than welcome to speak negatively if the product was less than impressive.

Cynics would say that standard human conversation is not the place for commercial gain, but a study amongst BzzAgent's users showed that 75% of people spoken to by an agent didn't mind the association with big business, as they trusted the agent's opinion. Theoretically, once the product has hit the stores, a buzz will have already spread among consumers, complimenting the simultaneous print/television/web-based campaigns.

Baffled small business owners around the Sussex region are probably wondering how any of this conglomerate talk applies to their modest marketing budgets. Admittedly, few local firms are likely to branch outside of their immediate environment and give away their precious stock all the time that maximising income is the main priority, and this is something that BzzAgent themselves recognise.

However, what the scheme does demonstrate to the small business world is the benefit of applying the growing word of mouth marketing (WOMM) movement to your firm, arming your existing and potential customers with something exciting to talk about.

At a time when our minds are a mush of slogans and jingles, interesting messages from reliable sources that rise above the average daily bombardment of rubbish do travel on a word of mouth level – and shaping those messages to contain all of your key information can be the difference between merely existing, and expanding your customer reach. Done correctly, WOMM offers small businesses a cheap, effective and generally more fun and fulfilling version of advertising.

So how does it work? Fortunately, WOMM has something of a guru in Andy Sernovitz, who has even written a book all about it. According to Sernovitz, successful WOMM boils down to a two-part philosophy: giving the people a reason to talk about you, and making that conversation easy to take place.

Are you remarkable?
'Giving the people a reason to talk about you' can be translated as 'showing customers why your business is a cut above the rest'. In today's world, people are conditioned to expect professional and efficient customer service, regardless of whether you are a national name or a local enterprise. As a result, it's natural for consumers to vocalise their frustrations when their experience wasn't so enjoyable, but the more positive dealings tend to be forgotten because they are simply expected. So the challenge for small business owners is to create a customer experience that moves from mere satisfaction to something remarkable, which ultimately stays in the brain and is worthy of being passed on to others.

Andy Sernovitz goes on to describe WOMM as "great customer service that earns customer respect… and fantastic products that get customers talking about you". I experienced WOMM first-hand a year or so back when a friend recommended Firebox to me. My friend was impressed with their distinctive product range of goofy toys and gadgets, how that range was presented on their web site, and the considerate nature of an e-mail exchange that she had with their customer service team. Her experiences with Firebox had placed them as the leader of their niche field in her mind, and in turn, she was inspired to pass on their name to me.

Firebox have made it easy for their customers (existing and new) to enjoy shopping with them by creating a memorable identity. They stand out because of the quirky tone used consistently on their web site and printed promotional material – a tone which is the perfect extension of their playful product range and personal touch in customer service. If people love the identity, they will spread the word – for free. Small businesses should look at how their services come across to prospective clients, and how putting some individuality in the sales pitch can get carried from one person to another.

Get the ball rolling
So with the identity in place, how do you generate the platform for discussion? The second part of Andy Sernovitz's philosophy involves making conversations easy to take place. The word 'making' can be read as 'forcing' or 'creating' – be aware that WOMM is potentially damaging if it doesn't appear to be organic, a key point made by Womma, the trade association for word of mouth marketers.

That man Andy provides a useful five-point plan for 'putting out the feelers' to let your message spread. It starts with identifying the people who are most likely to spread the word of your business, and providing your service was up to scratch, this is going to be your happy customers! These people then need something to talk about – simple messages that are quick and easy to transmit. It's more important that your area of business and location (physically or online) are spread – the best messages need impact.

Sernovitz also suggests that the best way to keep these conversations going is to take part in them yourself. It seems that everyone and their dog has a 'blog' these days, but they are still a useful tool for creating that identity I mentioned earlier. Blogs are time consuming and need constant care and attention, but they can be an excellent way of assessing both positive and negative customer feedback which shapes how you use word of mouth in the future, not to mention being a fun, individual place to demonstrate your latest products.

Whether you are ready to plunge into a world of web communication tools, or prefer to keep things offline, Andy Sernovitz's final point is to ensure that you always ask for referrals. Blogs allow your customers to leave comments at a click of a button, but in the offline world it's important to ask your customers for success stories along with their permission to share them.

If you have employees, they will play a vital role in building your company identity, receiving and acting on customer feedback, and ultimately distribute those messages. This article features some of the benefits of employee interaction, whilst this article suggests some incentives to promote genuine enthusiasm for WOMM amongst your staff. If you're interested in digging deeper into online networking tools, then this article is worth a read too.

The verdict
It's important to remember that word of mouth is not a wholesale alternative to traditional marketing techniques, especially for aspiring firms. However this piece on WOMM should hopefully highlight some of the advantages of having a strong, individual image that travels. Good resources worth looking at include the previously mentioned Womma, as well as the Society For Word Of Mouth.

As ever with our postings, we really want to hear from local business owners. Do you regularly attract new custom through word of mouth recommendations? How have you reacted to customer criticism? Have you used any online tools such as blogs, and if so, how successful have they been? If you'd like to get involved, please leave us a comment, or drop us an e-mail to businessblog@friday-ad.co.uk, and we will hopefully re-visit this topic later on.

Coping with the credit crunch

As if the prospect of being sucked into a black hole wasn't bad enough, it seems not a day goes by without talk of an impending recession and how it's affecting global banking, house prices, the price of fuel, turbulence in the airline industry; in fact, pretty much anything and everything in capitalist society… with the notable exceptions of football and the dead-animal-in-tank market.

Naturally, the doom and gloom reaches small business, with owners facing tough financial conditions in the battle to establish and expand their enterprises. Credit firm Experian released figures earlier this year showing that 4,798 businesses had folded in the first quarter of 2008 alone.

The 'domino effect' of the economic downturn has made borrowing a nervy process, with banks already toughening their overdraft facilities. In 2004, the average start-up business requested £82k in loans, but by last year this amount had leapt to a staggering £450k, with an 85% success rate for those borrowing through loans and mortgages. This increase reflects the pessimistic outlook for short-term revenue, as well as rising running costs ranging from fuel price hikes to higher interest repayment rates.

Traditionally, capital-hungry small businesses have borrowed with their property as security. However, falling house prices reduces the amount of net equity at the owners' disposal. A loan of £100k secured against a £300k house provides £200k of net equity, a cash buffer that smoothes many problems should a business not last the first six months. With some predicting house prices to fall as much as 25% over the next two years, significant amounts of property value are wiped off, leaving borrowers facing smaller or even negative equity. With a 48% rise in home repossessions in the last year, the pitfalls of borrowing more than you can repay have never been so blunt.

Still reading? We salute you for your strong stomach! While there's no doubt that small business owners are feeling the pinch, the fact is that they are not alone. Sure, businesses have been forced into longer working hours and overhead cutbacks, but aspiring owners should take comfort from the backlash emanating from certain rather more positive corners of the online business community.

Financial adviser Gill Millington describes the pitfalls facing small businesses today as a "vicious circle":

"What often happens when the economy takes a dip is you find you're trading well with business still coming through the door, but your customers start dragging their feet as they don't have the cash readily available to pay you.

And then suppliers need paying on time to keep your accounts with them running, so the knock-on effect begins to get uncomfortable for your own cash flow. It's a vicious circle that, if not dealt with, will drag you down."

It’s a harsh reality that businesses need to be more proactive and forward-thinking than ever before to reach to customers old and new, and to keep that precious cashflow moving along nicely. In other words, now is the time to look at how your services are marketed to maximise interest at a time when disposable income is at its tightest.

This article by Steve McKee for Business Week promotes a fairly conservative approach to marketing in the difficult economic climate, avoiding any adverse effects on your budget. McKee argues that there are some key rules to stay noticed and move away from the doom and gloom.

Firstly, in the immortal words of Corporal Jones, don't panic! Sure, some commentators have suggested that the credit crunch will be with us "for years to come", but the economic woe will eventually pass. Be thrifty and careful, you still have to get your marketing across – so don't sacrifice it simply to save costs. McKee states that your competitors may well be falling by the way side, providing you with an excellent opportunity to mop up their customers. This will require a promotional push but may just increase your market share in the long term.

Continuing the panicking theme, don't start targeting businesses you wouldn’t normally chase – it’s more than likely this will be a waste of time and resources. They didn't form a part of your business plan before, so why would they necessarily be interested in you now? It's sensible to focus on your existing customer base, encouraging loyalty and potentially attracting new custom through word of mouth recommendations. Similarly, now probably isn't the moment to divert your already-stretched marketing budget towards any radical business overhauls – save that full web site redesign for sunnier times.

Discounting is a murky area, and McKee discourages reckless price slashing that could also discredit your product in the long run. Price cuts look/sound great and might seal the deal with potential buyers, but how will your patrons feel about paying 'full' price again after you return to your original margins? A more effective idea would be to embrace the art of the special offer, taking principles from mass-market retail and applying them to your business. Offer deals for multiple product bundles, encourage a quick sale with a time-limited discount, or try and generate popularity around certain items to promote a mad rush at your checkout!

McKee's final golden rule is quite simple – apply some humility, positivity and the truth. You'd have to be living in a cave to avoid hearing economic news on a day-to-day basis. Yes, we are knee deep in a tough economic climate but this doesn't end the need for goods and services. People respond well to honesty (stating the obvious, we know) so keeping your customers well informed with how you intend the ride the storm should strengthen your relationship with them. Likewise, apply a good dose of transparency and a clear plan to any employees you might have on the books to banish any nerves amongst the workforce.

The economy may be struggling, but there is no reason for small businesses not to make the most of a bad situation. Hopefully our advice will spark some creative thinking on the way to surviving and even prospering in these awkward times.

We will be looking to post a follow-up piece later in the year, so we would really like to hear the experiences of small business owners affected by the credit crunch. How have you kept your existing customer base happy? If you have picked up more business, which particular tactics worked best? Please leave your comments or e-mail us at businessblog@friday-ad.co.uk – we need your input!