Marketing Course Evaluation

The second day of the marketing course covered several areas including: the creation of a good press release; how to get free PR; establishing joint ventures; and Internet marketing.

All of the material was of a high standard and well thought out and I really enjoyed the whole course. Much of the useful information was given with case studies from the presenter’s actual clients along with little stories and small details that really showed in depth how an interesting idea can be worked out in a real life business.

As with most areas of business, and indeed life in general, most of the good advice is actually just well thought out common sense. This is not a get-rich-quick style scheme and you left the course with a marketing plan for your business covering actions to take over the next few months.

I doubt that anything presented was actually completely new to the world of marketing but when you’re starting out from ground zero, as I am, it was a great way to learn how to create a proper marketing plan and a systematic approach. No more random ideas that you try out, instead you’re deliberately dedicating time to a proper plan.

Here is a link to his website Chris Cardell and I suggest you sign up to his newsletter that will give you some free tips for the first few weeks. Of course, he uses all this own tips and advice in marketing his own website!

Too Good to be True

If an advertising outlet, such as a trade magazine, contacted you and offered the oppourtunity to reach a group of people interested in your product, would you be interested? They also provide a guarantee so you only pay if the people actually express an interest in your offering. Of course you would think this is great. In reality it never happens, you try getting MSDN magazine to guarantee a response to your advert!

But just imagine if you could get that kind of deal. No more spending a lump sum on a magazine advert with no idea if it really does get to the people you are interested in. No idea if they actually show an interest by visiting your website. That is the difference between pay-per-click advertising and traditional trade magazine adverts.

Pay-per-Click

So the first strategy for Internet marketing is to ensure that you direct your target audience to your website using pay-per-click on Google. Of course, using the advice from the previous marketing post you would start very small and carefully. You would start by using a small daily budget and keep split testing your advert.

Split Testing

You should always have two versions of your advert on Google that differ by only one small detail. For example, your first advert is in traditional English format and your second is identical except you use capital letters at the start of each word. Even such a small detail can make a big difference to the click through rate.

After a few days you compare the click through rates of both adverts and then throw away the worst performer. Then you create another new advert and vary it from your best advert so far by just one factor. By constantly varying just one small detail you are constantly trying to improve the click through rate.

This is important because how high up your advert appears is dependant not just on how much your willing to spend on the advert but also the number of click throughs. About 50% of the ranking is determined by the click through rate and so pushing this up higher will save money and improve the number of visitors to your site.

Email Marketing

You should make a strong effort to get the email address of every visitor to your website. Not because you want to spam them, because we all know how annoying that is, but because it is much harder to get a completely new customer than communicate and sell to an existing one.

If you offer a demo version of your product get the visitors email and send them a link to download it, rather than just giving the link straight away. Then you can follow up in the future. After a few days you can ask the potential customer for their feedback.

At the very least this is useful in finding out what features are missing or putting off the visitors from buying. That is great information for helping you to improve your product. Asking existing customers what they think of the product is less useful because it obviously already meets their needs, otherwise they would not have bought it! But getting feedback from those that almost bought the product is of fantastic value and almost impossible to get from any other means.

Of course you can also use the emails to send them special offers in the future so they do not miss out on new products you release or temporary price reductions. I would also suggest that you ensure it is easy for them to unsubscribe and never give their email to any other organisation. You’re trying to establish a good quality relationship with them.

If you do not have a demo or trial download then think about creating some useful information to give away for free. Give them a report or set of articles that has value to them and would entice them to supply an email address for them to be delivered. The key point is you have to give them something of real value in return for them being willing to let you communicate with them. The more value you can supply then the more likely they are to take you seriously and be interested in reading your other emails.

Auto-responders

Before the course I had already heard of software to handle lists of subscribers. Just the sort of software needed to automate the process as described above. But I did not realise how easy it was to setup an auto responder for email marketing.

For example, your website visitor is interested in your product and would like to download the demo to test it out. So they enter their email address and press the Submit button. Their email address is automatically added to an email list and they immediately get a auto response email with instructions on how to download the demo.

The clever part is that the auto responder is set up to automatically send a follow up email to them after a certain number of days. So you configure the list to send a second email two days latter asking them to fill in a simple online feedback form to let you know what they think of the trial product.

Then after another two days you could send them a free article that describes more advanced features that they would then be able to make use of, now they are more familiar with the software. Finally you might then send a last email 10 days after the original download and offer them a 10% discount if they buy in the next week.

This sequence of emails and the delay between them is set up by you and then just works without any intervention. If you have 1000 requests for the download each month can you imagine the work involved in doing that manually? Crazy. But with an auto responder costing maybe $100 to buy it all happens completely automatically.

Automation, The microISV Friend

The technology behind an auto responder is of course trivial but it is the fact you can automate the process that is so useful to us microISV businesses. Working on your own or maybe just in your spare time you have to automate absolutely everything that you can. Time is the one thing we do not have much off. (As well as money or enough customers!)

It does not get much better than the following in terms of marketing…

Let pay-per-click gather new visitors
Let your website gain their interest
Let the download page gather the email address
Let the auto responder communicate with the visitor
Let a third party handle the ecommerce sale

You sit at your computer and write the code and the automated system handles the majority of the heavy lifting. Of course you need to spend some time each week keeping an eye on the system and tweaking it to gain the best results.

Too Good to be True

Just think, one night you will be fast asleep and someone on the opposite side of the world will travel through the entire automated system and buy your software. Now imagine you had told someone 10 or 15 years ago about this scenario. Add into the mix that you have almost no budget to spend and you only had to sit in your study, what would they say? They would say it was too good to be true.

Now tell me the Internet is not amazing!

The Two Sides of a MicroISV

To be a successful microISV we need to achieve two things. First of all we need to be good at innovation. If we cannot come up with a great idea and write the code to make it happen then we do not have a product to sell.

Creating an average product in a crowded marketplace is not a great recipe for sales. So we need to innovate in some way. It doesn’t have to be the next killer application like VisiCalc but it has to be a compelling solution to a problem that people have.

I think this half of the microISV equation comes quite easily to most developers. We love to write code and we always think we can do it better than anyone else. Plus we are always full of ideas of some cool product we would love to create. So usually the innovation side is where we get started.

The second half of success is marketing. That forgotten half that most of us don’t even think about until the product is already fully written. This includes me, the first product I wrote had no marketing strategy for at least the first 18 months of being sold!

Learn, Learn, Learn

I was thinking about this issue a few weeks ago and wondering how to handle marketing for the components I will be creating over the coming months. Then it struck me that I should solve the problem in the same way I would a technical problem.

If I need a new skill, such as learning a computer language, then I go on a training course. Why should learning a new skill like marketing being any different? So that is exactly what I have organized. Today I went on the first day of a two day marketing course that has a particular focus on Internet marketing.

Rather than hog this information to myself I will post about the interesting points covered relevant to our situation. There is far too much detail to write up everything from the first day in one go, but we can start with the overview of the successful marketing process. (His claim, not mine!)

The Five Golden Rules

1. Purpose of your business
2. The three ways to grow your business
3. Create multiple pillars of marketing
4. Test and measure
5. Calculate your customers true value

Lets have a look in more details at each area in turn.

1. Purpose of your business

You probably think that the purpose of any business is to make money for the shareholders and especially so if your one of the shareholders yourself! But there is actually only one purpose that all really successful businesses have. Namely the desire to add value to the lives of their customers.

In fact not just a desire to add value but an absolute passion for it. You need to have the mindset of wanting to create incredible value for your customers and then the profits will take care of themselves.

2. The three ways to grow your business

There are only three ways to grow your business. You can increase the number of customers. You could increase the average spend from each customer and last of all you can increase the frequency that each customer buys from you.

In fact you should be trying to increase all three at the same time. If you can increase your number of customers by 10%, and the average spend of customers by 10% and finally the buying frequency by 10% then your overall revenue goes up by an impressive 33%. Each individual 10% increase does not seem impossible to achieve but it is the cumulative effect that can make a really big difference.

3. Create multiple pillars of marketing

Most businesses rely on just one or maybe two different pillars of marketing. They use just advertising or maybe just direct mail to achieve sales. Instead you should ensure that you deliberately create and use multiple marketing pillars.

So investigate advertising, direct mail, telephone sales, referrals, pay per click, email, PR and joint ventures. Have a deliberate policy of trying out new marketing methods on a regular basis to reach more potential customers.

4. Test and measure

The vast majority of advertising and indeed marketing is a waste of money. In order to avoid wasting money you have to ensure that you can test and measure every aspect of your marketing.

If you place an advert on a website, then ensure you can measure the number of visitors this brings to your site. Even more important, make sure you can measure the number of sales this generates. Everything from each advert to each email campaign must be measurable.

Only then can you decide if the cost justified the resultant sales, and it also allows comparisons. You try one advert with a particular headline and you make 5 sales from it. Next month you do exactly the same but with a different headline and see what sales that generates. This way you can refine and improve the effectiveness of your marketing and constantly try out new ideas to find what does and does not work.

5. Calculate your customers true value

This calculation is integral to helping with step 4. You need to work out how much each new customer is worth in revenue to your business. So for example, an average customer buys three products from you over a period of three years and that equates to $600 in revenue.

Using this figure you can calculate if a marketing approach is worthwhile. If an advert on a website generates 3 new customers then you know that the value to you (on average) is $600 per customer or $1800 overall. But if the cost of the advert itself was only $1000 then you know it is worth doing again and again.

This total value of a customer is important and not just the initial revenue they create. Your new customer might only make a single purchase in the first month and so only be worth an initial $200 to you. Multiply that by 3 new customers and it looks like your $1000 advert is only returning $600 in revenue. But from analysis of your customer buying patterns you know that over the full three years that the average customers stays with you it will actually pay off.

Without knowing the true value of your average customer you cannot make intelligent decisions about what will and will not pay for itself in terms of your marketing spend.

Summary

This is really just a simple overview and does not provide the interesting stories and case studies that were the real heart of the presentation today. For me the really interesting points were 2, 4 and 5.

Make sure you can measure, or at least roughly estimate, the value of each new customer. From that you can carefully test new marketing ideas and measure the effectiveness. Try each new idea on small scale and only when you know it is working do you then scale it up to achieve the big effect.

Building the Foundation

As already mentioned in a post right back at the start of the blog, I already have a pretty clear idea of what the first three product components will be. Our first component is actually quite simple in concept and so don’t expect it to blow your socks off!

Although simple it is an essential building block needed for the second and third components that will be built on top of it. So it provides the foundation for the rest of the component suite. Not just as a reusable component but also by providing helper classes and base implementations that can be reused later on.

Classic Controls

After working with several different user interface libraries you being to notice that there are several custom controls that obviously are conceptually related. Yet, to my surprise, they have never been built from the same base class or using the same fundamental building blocks. This makes it difficult to interoperate between them.

Think about the classic TabControl. This allows the user to navigate around a set of pages in a random manner. They can click from page to page by using the appropriate tab header. Now think about the classic Wizard dialog. Again the the user can navigate around a set of pages, but this time in a linear fashion. Another more recent control is the Outlook bar from Microsoft Outlook 2003. Here you can select pages at random by using the large square buttons at the bottom of the control.

Really these are all just controls that allow the user to define a set of display pages and then provide different user interfaces for moving between them. So our first component is going to be called the Navigator and do just that, give a variety of user interface mechanisms to move around pages.

The Navigator

Having a component capable of providing many navigation interfaces has several key advantages. With other libraries you might create a TabControl with a set of TabPage instances. But if user feedback indicates you need to change over to a Wizard you cannot just copy across the TabPage instances. The chances are your Wizard component has a completely different set of classes and you need to go to some effort to copy across your designs.

Although not a huge effort it does still take time to learn about the new component and copy across the controls for each page. With our navigator they just change the mode property and hay presto, it changes over. Better yet they can use the traditional TabControl style appearance when designing, making it easy to randomly move around, and then switch it to Wizard operation when finished.

So our first unique selling point for the component is the provision of multiple modes or user interaction. We provide all your page navigation needs in one handy control that is a piece of cake to learn. You learn how one control works instead of having to understand several.

Separating the Layers

Our second unique selling point is going to come from the architecture of the control. Instead of encapsulating all the drawing inside the control we are going to separate out the functionality into different layers.

Palette Layer – Provides the colors and font for drawing.
Rendering Layer – Draws using a palette in a particular style.
View Layer – Handles the layout of visual elements.
Controller Layer – Responds to events and initiates actions.
Model Layer – Manages the collection of pages.

This is really just an extension of the traditional Model-View-Controller design pattern where the View is split into three separate layers. This makes it easy for us to change over the palette layer to give a different appearance without having to alter the renderer at all.

Before I get stuck into too much of the actual coding, any feedback on the idea would be appreciated. But remember that although the Navigator will be sold as a stand alone product in its own right, it is mainly intended as the building block for other more value added components later on. So don’t be too harsh!

Logo Decision

First of all thanks for leaving comments on the last post about the final set of logos. At the last count the score was 5 for the first cartoon logo and 6 for the second corporate version. I was already leaning towards the second logo anyway but the feedback really confirms my initial preference. So I’m going to use the second logo.

Technology Decision

My first major technical decision is the choice of technology for developing my C# visual components. We need to look into the future and ensure that anything written is not going to be out of date before it is even released. The current released development versions are .NET 1.1 for the Framework and VS.NET 2003 for the IDE.

Visual Studio .NET 2005 and .NET 2.0

Looking ahead the next big change is the release of Visual Studio 2005 and .NET 2.0 on the 7th November 2005. I already have the Beta 2 release of this and have been playing around with it recently. Although a little shaky it is just about stable enough to develop against.

Avalon and Longhorn

Further out is the new Avalon user interface framework that was originally slated to be released with Longhorn. For those not familiar with Avalon its a fundamentally new framework for developing user interfaces in the managed code environment.

Whereas Windows.Forms is based on GDI+ the Avalon framework uses DirectX. There are early releases of Avalon being made in order for developers to play around with it. However these are very much development releases and each update contains fundamental changes to part of the design.

A full stable release of this technology cannot be expected until the release of Longhorn, which is scheduled for the end of 2006.

Comparing the two options

If we develop for .NET 2.0 then we can start development straight away and know that few, if any, changes will be needed when the full release is made. Another advantage is that we only have to wait 5 months until its released and so we can sell components from then onwards. On the negative side the product will have a lifespan limited by the time it takes for Avalon to really take off.

If instead we go for Avalon then we don’t have a proper development environment and have to learn this new technology from scratch. That also means we have to wait some time before a commercial market emerges for these components. On the plus side it would mean we can get involved right from the onset of the new technology, and stay at the leading edge of the system as well as enjoying a longer lifetime for any software developed.

The final decision

As a code monkey I am tempted by the idea of getting into Avalon, if only for the excitement of getting into something new and interesting. But from a business point of view I believe the correct decision is to go with .NET 2.0, at least for the time being.

A would rather go with the more certain opportunity even if it has a shorter potential lifetime, than try and go for something way off in the future that is currently vapourware. Plus the release of .NET 2.0 is about the right time frame for writing a first release of a product and having the website and e-commerce ready.

So, time to create a new VS.NET 2005 Beta 2 solution and get cracking!