Wise Web Strategy

Are you missing the boat?

Sometimes when I am off my game, I start thinking about trying to become a professional musician.  Eventually, I come back to reality.  I am not good enough to be a professional musician, and frankly, I don't particularly want that kind of life.  The life of an aspiring musician is difficult beyond belief.  Even highly-successful musicians work unbelievably hard and sacrifice tremendously for their profession.

That being said, I am a critic of music.  Like many musicians, I am such a critic that I have a hard time actually enjoying music because I am too busy picking it apart.  That is the curse of being a musician.  I feel especially sorry for musicians with perfect pitch--almost everything they hear must drive them crazy.

My biggest pet peeve about the musicians I hear on a regular basis is that they do not understand what the purpose of their music is.  Almost all musicians think that their music is about themselves--showing off their talent and demonstrating superb technique. 

Nothing could be further from the truth.  Music is not about technical complexities and logic--it is about emotion and communication.  Great musicians understand this.  I recently heard the Country star Kenny Rogers tell an aspiring artist the following bit of wisdom about a particular song: 

Your job is not to impress people.  Your job is to make them cry.

Is all music supposed to make people cry? Of course not.  However, all music should touch people at a deep level.  If you accomplish nothing more than impressing people with your technique, you have failed.

In a nutshell, that is what separates good musicians from great ones.  Good musicians have great technique.  Great musicians are great communicators.

Some musicians take an over-emphasis on technique to an extreme and become elitists.  There are musicans who think that technically complex music is culturally and morally superior to simple music.  Many of them also think that Europeans that lived in the 17th through 19th centuries set the standard (with classical music) by which all music should be judged.  Talk about missing the boat... They could not be more wrong (even before exploring the racial overtones of that position).   I will take simple music that communicates on a deep level over 18th century fugues any day of the week.  (No offense, Bach--you were a genius.)

In a nutshell, most musicians entirely miss the boat, and that is a major reason why only a tiny percentage ever become successful. 

Like musicians, businesses have a tendency to miss the boat.

You have probably seen businesses make entirely irrational decisions.  They might choose not to advertise when they need to, or they might acquire a steel factory even though they are in the paper business.  They might claim to sell quality but discount everything to a level where the perception is anything but quality.  These are examples of businesses missing the boat.

Businesses tend to float through the years without a clear understanding of what their purpose is, who they really are, who their customers really are, and where they are trying to go.

In case you missed it, there were four important questions in that last paragraph that you need to answer about your business.  If you understand these issues, you will automatically have a road map that will help you understand the decisions you need to make in specific situations.

Knowing and being committed to your answers to these four questions will keep you from missing the boat.  You will find yourself selling the right things to the right customers in the right way.  You will also make the right decisions about such issues as hiring, cash flow, acquisitions, and any number of other things that can trip you up.

I am going to discuss the application of these four questions at length in my next post.

PPC costs on decline

I have often said that PPC advertising is a dangerous trap because it is so overpriced.  Online retailers tend to overbid for keywords because they don't really understand the metrics behind that kind of advertising. 

I have watched one company after another fail because they spend a fortune on Overture or Google and don't get their money back.  Still, other companies are quick to jump on the bandwagon, and as a result, keyword costs have remained artificially high.

It appears that this trend may be ending, and it is about time.  The average keyword price dropped to $1.27 during the second quarter of 2006.  That is an enormous correction from the previous year where the average price was $1.72.

I cannot speak from empirical data, but I would guess that $1.27 is probably at least twice where it should be and will hopefully end up.  In the meantime, this is a healthy trend, and should eventually end up transferring money from the pockets of Overture and Google back to the online retailers.  It is obscene how much money Google and Overture have made off the backs of online retailers, and I am glad that it is coming to an end.

Do you love what you do?

If you enjoy what you do, you will never work another day in your life. - Confucius

It is my opinion that one of the gravest mistakes that you can make is resigning yourself to going to a job every day that you hate.

That is not to say that you will enjoy every job you ever have, but if you are not enjoying your job, that job should be a stepping stone toward a job that you will enjoy.  If not, you should either figure out how you can enjoy it or develop a plan to quit it as quickly as you can.

Life is too short, and too much of your life is spent at work.  You should not be wasting your life on work you do not enjoy.

I watch trends, and one trend that is alarming is how the percentage of workers who do not enjoy their work is going up rapidly.  Well over half of US employees now claim to hate their job.  This is up drastically from just a decade ago.

Has the workplace changed or have we changed?  I think the problem is that we have changed.  Certainly, not many people are working in worse conditions in 2006 than they did in 1996. 

I recently read about the US coal mining industry in the early 1900's.  If you think your boss doesn't care about you, you work too much, and the work environment is bad, you should learn how those coal miners had to work.

My point is that often our job dissatisfaction is not about the job as much as it is about us.  After all, if office employees in 2006 have a lower satisfaction than coal miners had in 1900, the problem is not the work itself.

That being said, sometimes people hate their jobs because it is just not what they want to do.  They are accountants but they want to be musicians, or they are computer programmers but they want to be CEOs.

If you find yourself in this category, change jobs.  Oh sure, you can't do it overnight.  You may need to get your finances in order, or you may need to stay in your job a little longer to learn enough to transition to the next job.  But at least, put a plan in place to make a job transition as soon as possible.

I did this in 2000.  I came to the realization that I hated being a computer programmer.  At the time I worked for Delta Airlines, and I set April 12th, 2001 as my last day of employment.

Two weeks before April 12th, 2001, I walked into the office of my boss and resigned.  On April 12th, 2001, I walked out of the office for the last time.  It was one of the happiest days of my life.

I don't want to pretend like my current work is always fun, and it certainly is not easy.  However, I love what I do.  On weekends, I look forward to Monday.  When I go on vacation, I look forward to getting back to work.  For me, work is vacation.

Don't be a slave to a job you don't like.  Either fix your attitude or put a plan in place to change your job.

The main reasons I hear for why people do not quit the jobs they hate and do something they want to do are 1) finances and 2) health insurance.

Crippling debt has forced many people to stay in jobs they hate.  Many people have traded job satisfaction for a big house and nice cars.  I have never seen a worse trade.  If you are miserable at work, who cares what kind of car you drive to get there?

My advice to you is sell the cars and buy older cars.  Sell your house and buy something smaller.  Live well beneath your means and pay off your debts.  The less debt you have, the more ability you will have to do the job you want to do. 

Don't make more of the health insurance issue than you need to.  If you are switching jobs, the new company will add you to their insurance plan regardless of preexisting conditions.  On the other hand, if you are changing to a profession where you will not have access to a group insurance plan, you will need to do some legwork.  If you are young and healthy, health insurance is cheaper than you probably think.  If you are older or have preexisting conditions in your family, I will admit that health insurance can get tricky.

There are very few of us who have to settle for work that we hate.  Start working on your plan today to get to the point where you find yourself looking forward to Monday.

Offshoring and outsourcing

I have been struggling through the popular book by NYT columnist Thomas Friedman entitled The World is Flat.  If the world is flat, Friedman's book sure isn't.  It is very thick, and a long boring read.  Friedman is a journalist, and not a businessman, and I think he is in love with words.  Whether there is much useful information in there, I am not sure, but the topic is certainly worth a bit of exploration.

If you are unfamilar with the book, it is simply about outsourcing, and how technology has changed the world.  Specifically, jobs are moving overseas to areas where people work for less.

There is no doubt that this is occuring of course.  For example, in the music world, producers are starting to go to places like Prague to hire orchestras for recording.  Musicians work for $65/hour in Nashville, but they work for $4/hour in Prague.  With a 100 piece orchestra, that is a difference between $6500/hour and $400/hour. 

Of course, there are tradeoffs.  I am not going to use a Prague orchestra for anything I work on because there are certain intangibles in music that are American in nature that they cannot reproduce.  They have problems interpreting dotted rhythms for example.  Also, after figuring in travel expenses, only larger projects really even begin to make sense.

In a software world, the change is more dramatic.  I get calls every month from overseas firms that want me to outsource our development work.  Often, those firms will charge around $5-$10 per person hour, while it costs me perhaps $40/hour here.

Believe me when I say that those numbers sound good, and I would love to find a way to make it work.  However, while the world is getting flatter, there are still enormous hurdles to overcome to make overseas outsourcing work.  Friedman's theory is largely not based on reality.  I do expect things to improve in coming years however.

If you are a small company, you might be tempted to offshore your web site at the very least.  This is actually easy to do.  Just post a project on elance, and you will have no shortage of cheap Indians and Chinese bidding on your project at remarkably low prices.

If your budget is small, I actually encourage you to use overseas designers and save some money.  If your website is simple, ask them to build you a template, and then fill in the content yourself.  You can get a fairly professional template for $500.  Or, you can go to a place like www.templatemonster.com and buy a template that is slightly less customized for even less.

If one of these solutions meets your needs, you are in good shape.  An American designer will charge more and be more difficult to work with.  American designers often do not want to do what you tell them--they think they know more than you, and get offended if you question their designs. 

As soon as your design gets more complicated, or you want someone to actually go beyond a template design and manage your site, the offshore model begins to break down.  Here are some of the reasons why:

1) If you are selling to Americans, you need to feel American and use American nuances.  Indians cannot replicate this. (I give them credit for trying, however.)

2) The turnaround time on projects is normally elongated.  You will not get any offshore firm to admit this.  They will claim that they work at night so they are awake with you.  However, the time difference and the inability to talk easily with your designers justs adds time to the project.

3) Communication is inefficient.  If you are picky (and you need to be), it is just difficult to communicate what you want to another culture.  It is hard to explain this, but if you experience it, you will know exactly what I mean.

4) There are bad employees overseas too.  Yes, America is full of lazy, worthless employees.   Unfortunately, we don't have a corner on that.  I think that I would probably be happy with less than 10% of US designers.  In my experience, the same goes for overseas designers.

These problems with overseas outsourcing do not just apply to software development.  Friedman claims that accounting firms are outsourcing a ton of work overseas.  That may be, but I asked my accountant about it.  He works in a large Atlanta firm, and they have tried outsourcing.  He told me that the quality of the work was so poor that they had to quit.

So, here is where I stand on outsourcing.  It is not too effective yet, but it is not something that you can ignore.  It will continue to drain money out of the US economy and lower our standard of living.  On the other hand, as things improve, it will open up opportunities for small businesses to compete.  If you have a small website that needs an update, give it a shot.  You will probably be pleasantly surprised.

Brand continuity

If you are interested in just selling whatever you can find online and jumping from one thing to another, you might not care about your brand.  On the other hand, if you are trying to build a long-term great business, there is no better time to start worrying about your brand than right now.

It is important to understand what your brand really is.  Your brand is simply what your customers think about your company.  Notice that I did not say that it is what you WANT your customers to think about your company.  A brand is not a logo or trademark.  It is not slick marketing materials.  You cannot tell your customers what your brand is.  They will decide what your brand is for you.

It is interesting when I see a company change their name and start running a "re-branding" campaign.  Unfortunately, a brand change involves much more than changing your name.

If your customers contact you by phone, your phone people are influencing your brand.  If you ship them things, the box you ship in influences your brand.  For that matter, the way you tape the box shut influences your brand.

At Vitabase, we have been working for several months to determine all the touchpoints in our process in which customers interact with us, and we have been working to make sure our brand is consistent at all of those points.

Obviously, for an online company like us, our web site is normally the first touchpoint.  However, other critical touchpoints include phone orders, customer service, the package and contents that we send to the customer, and all follow-up correspondence.

If your website sells quality and you send your customers their products in reused boxes with newspaper stuffing, you do not have brand continuity, and are sending mixed signals to your customers.  If you proclaim your good service but your phone reps are too short with the customers, you are sending conflicting messages.

You get the idea.  Once you decide what you want your brand to be, figure out your touchpoints and make sure that you are sending a consistent message at each touchpoint.

Subtle things make a big difference.  One day this week, I was at a meeting at the beautiful Atlanta Athletic Club.  I poured myself a glass of water from the obligatory decanter in the middle of the table, and when I raised the glass to drink, I noticed something interesting.  The water smelled good--like citrus.  It was a very pleasant sensory experience.  I noticed at that point that all the decanters had slices of orange in them.  The orange slightly flavored the water and produced the aroma.

I have drunk water from similar decanters in numerous meetings just like that, but never water with a planned aroma.  That little touch said a lot to me about the Atlanta Athletic Club and helped reinforce their brand as an impeccable, exclusive club.

Look for ways to make similar little impacts on your customers that reinforce the brand you want to have.  Don't expect the process to be simple, but little changes added together will make a big difference in your business.

Are you the weakest link?

I am a semi-professional pianist in my spare time, and am recording a project later this year.  My producer and I needed to meet with our orchestrator and pick a recording studio, so I spent the day yesterday in Nashville, Tennessee on Music Row, the world's recording capital of several kinds of music.

I am always fascinated by the world of professional music.  I love the business and I love the recording process.  I especially like working with the people in the business.  The reason is simple--I like working with competent people, and there are many many competent musicians in the business.

One of the interesting things about the industry is that an unknown artist like me can use the same studios and the same studio musicians as the top recording artists in the country.  For example, I am recording in a studio that almost every major country and Christian artist has worked in, and my orchestrator has done work for many of those artists.  The musicians we will be using are the same ones that you hear on major artists' CDs.

I am not saying this to brag.  The fact is that if you are willing to pay, you can be the worst musician in the world and still have access to the same people.  The music business is a difficult business.  The studios always need clients and the musicians always need work.  There is a joke in Nashville where if someone tells you they are a singer/songwriter, you ask them what restaurant they work in.  There are far more musicians than there are available jobs, and most aspiring musicians never really have a chance to succeed. 

I have decided to orchestrate the project I am doing later this year, and the orchestra is going to be around 35 musicians.  On top of that, we will be using a conductor, a producer, two engineers, and maybe a few other people just to listen and give advice.  In all, we will have over 40 people in the room.

I will likely be the weakest musician in the studio.

I want it that way.  I am happy that I have people helping on this project that have better ears than mine, better technique, more knowledge, and more talent.  I am not too proud to take advice from people that do not even play the piano.  My producer has a better ear than I do, and I listen to what he says.  Even though I am paying the bills and making the final decisions, I rarely veto his suggestions.

Studio musicians are incredible.  The stress of recording is intense.  In Nashville, an orchestra of 35 members will cost someone around $2200/hour or over $35 a minute.  No one is going to hire musicians that are not very close to perfect.  It is simply not feasible to have to keep doing rework because of the mistakes of studio musicians.  Even under that pressure, studio musicians do a remarkable job.

Being around good musicians is a lot of fun, and it is fun working with the people in my business, too.  Over the years, I have grown to understand that having the right people around you is one of the most critical factors to your success.  Not only will you be more successful, but you will have a lot less stress in your life. 

If you still are running everything and making all the decisions in your business, you are missing out.  You should take a break from day to day operations and start working on a plan to hire better people.

Of everything I do, I spend the majority of my time on human resource issues--recruiting, hiring, retention, development, etc. Ever since I have made getting excellent employees a priority, it has paid off.  I now have some of the best employees I could hope for.

My goal is to hire in a way that I will become the weakest link in my business.  When I am away from the office with other people, they often express surprise that I do not get many calls.  The reason for that is that I have good people that do not need me.  It is a liberating thing.

That is my thought for the day.  Stop working in the business for a while and focus on your people.  Hire excellence and then let them do their thing without micro-managing them.  Eventually, you will be the weakest link, and unless your ego cannot handle it, you will love it.

Velocity - the edge of small business

Here in Georgia, some of the redneck drivers get upset when you pass them.  I think they take it personally for some reason, because you will often see them speed up and tailgate you or if at night, turn on their bright lights to try to annoy you. 

Last Sunday, I passed such a driver.  He started tailgating me.  Unfortunately, a car ahead was turning and had stopped, and I had to stop very suddenly.  I had no problem stopping, but the car behind me did.  As a result, he destroyed his car and damaged the bumper on mine.

Even though the accident was clearly his fault, I was very upset with myself.  In my mind, my impatience to get home a few minutes quicker led me to pass the guy.  If I had not passed him, he obviously would not have hit me.  My impatience got me into trouble.

That is hardly the first time my impatience has gotten me into a tough spot.  I struggle all the time with impatience.  It is a problem in my life that I need to constantly work on.  It also causes problems in my business.

If you have a smaller business, you should know that velocity is your strength and is your edge against your larger competition.  You should be able to make changes much faster than they do.  Your goal is to exploit that advantage.

Changing direction rapidly is exciting and fun, and makes you feel like you are always doing important things.  Unfortunately, it can also mean you are wasting a lot of resources because you are doing a lot of rework. 

The moral of the story is this: work fast and make decisions quickly.  Just don't do it too quickly.  Invest some time up front on planning and design before you go to work on new projects.  Sitting around a table for a few hours debating the plan is not going to hurt you.  It is going to save you a lot of rework down the road.  The same goes for research.

In other words, don't get impatient.  When I have gotten impatient in business, we have ended up building things that we never used or wasting a lot of money.  Patience is a virtue in life and in business--even a small business.

Agassi retirement

I am a fan of Andre Agassi.  I was not always a fan--Agassi used to be a brat on the tennis court.  He has been playing for a long time, and gradually over that time, he grew up.  Today, he is not perfect but is a gracious winner and a gracious loser.  He does extensive charity work and is in general, an admirable person.

I have been watching Agassi the last few years when he has had to show tremendous heart to compete.  He worked as hard as anyone in tennis even though he had already accomplished everything he needed to.  He was still working after Sampras, Courier, and Chang retired.

It was sad to watch Agassi retire today.  He marks the end of an era.  Today's American tennis players just do not seem to have the heart and drive of people like Sampras and Agassi.

In his press conference after losing today, Agassi said something that struck me hard.  Keep in mind that tennis has given Agassi almost every possible dream--power, money, and fame.  However, here is a quote from Agassi today:

I look at the young guys and it's evenly balanced between me seeing the great things they have to look forward to and how much I wouldn't do it again.

In other words, Agassi was saying that if he had to live the last fifteen years of his life again, he is not sure he would have been a professional tennis player.  The point he was making was that it is often overlooked just how much he had to give up for his success in tennis. 

It is hard for any of us to imagine how much he has had to work to stay on top of the world for all of these years.  We can't imagine how many tradeoffs he has had to make between success and doing other things he wanted to do.

Often, entrepreneurs have the same goals in mind that Agassi has obtained--money, power, and fame.  It is important to understand what we might have to give up to get there--relationships, family, ethics, etc. 

Agassi as much as said today that what he obtained was not worth what he had to give up.  He also implied that fame, money, and power do not satisfy.  This is a warning for all of us--be careful not to give up things that are truly important for something that will not satisfy you in the end.

My Nordstrom experience

In my opinion, the desire and ability to learn are essential factors in the success of an entrepreneur.  I have trained myself to look for ways to learn both inside and outside of my business.  One of the things I do when I go into stores to shop is evaluate how they do business and look for ways to learn from them.

The problem for me is that most of the time, the only store I go into is Wal-Mart.  That includes when I shop for clothes, by the way.  I am not what anyone would call fashion-savvy, and it shows.  There is much to learn from Wal-Mart, but our business is not set up on the same model as Wal-Mart, and we don't care to be.  We cater to discriminating customers who care about quality and service more than price.  That limits our potential market, but also puts us in an arena that is less crowded with competitors.

I have been thinking for a while that I need to start dressing better.  My wife needs new clothes, too.  The problem is that neither of us really know anything about clothes.  If I go into a mall, I can't begin to figure out what I should buy. 

A friend of ours works at Nordstrom and I recently asked him if somebody there would help us pick out clothes if we went in.  He said that they had a program just for that called "Personal Touch" and that it was complementary (I liked that part). 

Yesterday, we went to Nordstrom and stayed there for about four hours.  I met with Fletcher and my wife met with Wilma.  It was a fantastic experience.

I am still amazed that those two employees spent so much time with us.  We spent money but nothing like other people probably spend.  They were unfailingly polite and respectful, taking the time to explain such issues as how to identify quality in clothes and how to match things.

At 8:30, we were finally ready to leave and were going out to dinner.  Wilma wanted my wife to wear one of the new outfits to dinner, and asked me to wear one of mine.  I told her that I could not because it needed to be ironed.  I was surprised that she immediately volunteered to go iron it. 

Both Fletcher and Wilma gave us business cards and told us to call if we ever had questions about the clothes such as whether different items matched.  They take pictures of the clothes so that they can remember what we bought.  They call when they have something come in that they know you will like.  They will even come to your house to help you with your clothes if you want. 

On our way out the door, Wilma took a picture of us together wearing the new outfits.  Because we enjoyed the experience so much, we left feeling good about being a considerable amount of money poorer than when we went in.

Changing from Wal-Mart to Nordstrom in one step is pretty big, but I am hooked.  I will be back to Nordstrom many times as long as I can continue to afford it.  It is simply a great way to shop for clothes.

Nordstrom is not for everybody, but they know who they are and who their customers are.  Most importantly, they know the little touches that make a big difference in their ability to appeal to their customers.

The same principle applies to my business. It is important for Vitabase to know who we are, who our customers are, and how to make them happy. If you don't have the answers to these three questions in your business, take some time to think about them.