San Bernardino, November 22, 2011—Tough economic times can be opportunities.

With over two decades of successful client growth, Ron Burgess, speaker, will present actual case studies and illustrate why these companies have been able to grow, even in tough economic times.

The seminar, provided at NO COST, will also include information on how your business can use proven marketing strategies to turn difficult economic times into new and profitable business opportunities.

With three decades as a business-marketing consultant, Ron Burgess brings a unique understanding of marketing possibilities to small and mid-sized companies. A frequent speaker at marketing industry meetings, he has authored over one-hundred articles on marketing and the Internet. Burgess is also current President of the American Marketing Association (AMA) – Inland Empire; CEO of RedFusion Consulting; and Principal at Burgess Management Consulting. His personal clients include top market-share performers in agriculture, industry and professional services.

SBETA, (San Bernardino Employment and Training Agency) in partnership with RedFusion Consulting, has schedule this seminar, for business owners and senior managers, on November 30, 2011 from 8:00 a.m. to 12:00 pm at the SBETA offices, located at 600 Arrowhead Ave., Suite 300, San Bernardino. To reserve, call Katrina Smith at 909 888 7881, ext.269.

This is part of the “Marketing Authority” series from American Marketing Association-Inland Empire. Vist the website at www.AMA-IE.com.

I’m an old dog when it comes to marketing. I remember the first personal computer.  It had absolutely no impact on marketing. But a few years later, the first Macintosh illustrated to me how the print medium would change when I took my Aldus (later Adobe) PageMaker class in ’86.  The days of typesetting and paste-up were over for many types of publications. Later, my company was hired to break (build a file too complex for) Xerox color printers. We succeeded in breaking it for a while, but they eventually got it right.

The point is, I thought design houses and ad agencies were doomed because businesses would do all their own publications. I was enamored with the technology and what I could do with it; but I was wrong about replacing professional work.

Yes, the general quality of print has increased dramatically since then, but the average business owner still does not know how to write compelling copy, do stunning design, or many times tell a clear story about why they are different. Sure a flyer looks better; but it typically does not get the entire job done that marketing materials are supposed to do.  Further, companies that appreciate that fact still hire agencies, writers and designers to do their important print pieces. Designers make much more money than they did before the publishing revolution and so do real marketing professionals.

Recently the same phenomena have begun to penetrate the website business.   Low cost
pre-designed website templates and self online publishing tools are available to businesses that “anyone” can do. Partially true.

But interestingly nothing has really changed. The old tricks (skills) are still more important than the technology used to create the communications.  Online communications still must start the visual dialog with appropriate images (the brain decides instantly and sometimes without you knowing), that compel emotion, trust, tone and engagement.  Professionals can get this wrong; non-professionals get it wrong most of the time.

Then the copy must be right for the exact audience, in the right voice, tenor, and tone. Together the copy and graphics must demonstrate, inform, educate and sell the product. The offer must be right, and the sales cycle completed to get action.  Again, only the best pros do this right, and not all the time.

So this old dog predicts that after a try or two, and little growth occurs, the smart money will again realize that technology has not changed the marketing and selling basics, it has only enabled more to see the amateur work of a company.  Technology does not create writers, designers, marketers, or salespeople out of anyone. And almost no one has all those skills in one brain.

Marketing requires an intelligent and experienced person to make sure the basics are completed before worrying about executing the technology.  Access to the technology easily fools us  into believing we can do it. I have never been a great speller. The first time I published a professional looking newsletter for the company in PageMaker, I was enthralled with the layout and simple graphics that were available in that era. But all I succeeded in doing was to show how poor my spelling was. It’s funny how a few small details destroyed the huge advances I had made. While spell-check has helped, you can still spell the wrong word right.

Small companies should take extreme care not to follow my naive assumptions of so many years ago.  It only takes two or three mistakes to kill your company image and reputation.  So if you are a great writer, fine, don’t take a chance on design. If you are a gifted designer, be sure you understand who you are targeting. If you have any budget at all, hire tested professionals to execute your new technology.

One last note on the latest online technology – Marketing online. Your website, social networking, blogging, RSS feeds and Search Engine Optimization need to work together. Understanding how to execute these highly effective plans is still very complex, even if you have expert writers.  Because of the rapid nature of the technical changes and complex nature of multi-media campaigns, no simple break-through exists yet. We are not yet that sophisticated. This is still not magic. It’s just plain work.  This part still needs outside help for all except the ones who you would hire to do it. This is true for all sized companies.

The old dog, can learn new tricks, but we still need the old tricks to succeed at marketing.

Ron Burgess is a marketing consultant specializing in business growth strategies. He has been involved in blending marketing execution with technology since the 1980’s. He can be reached via his website at BurgessManagement.com, or at http://www.linkedin.com/in/ronburgess

The Marketing Authority –

Riverside – Once again, Athena Research Group has been rated one of the top Focus Group facilities worldwide, and 2010 is the 3^rd time they have won this prestigious award.

This award is given by the Impulse Research Corporation, a Los Angeles firm that provides quality ratings of focus group discussion and viewing facilities, based on a survey of over 5,000 moderators and researchers worldwide. In 2010, they were rated on recruiting, personnel & the service they provide, physical facility, location, food service, value and overall weight average of the above.

In 1999, Lynn Diamantopoulos started Athena Research Group to provide qualitative research, and to give her clients strategic insights to gain wisdom to make wise judgments. “Since Athena is the (Greek) goddess of strategic wisdom, and that is what market research should provide.” she said. “And since I married into a big Greek family … it felt like a perfect match.” Lynn is active in research communities and has been a board member of American Marketing Association-Inland Empire for several years; she currently serves as the membership chairperson.

Athena has been in business for 12 years, and they have 12 employees, with the average longevity of 9 years. She attributes this incredible retention rate and longtime loyalty to the fact that she treats her employees well, and they love what they do. She was especially proud of her team last year, as they won their award under extreme circumstances.

Not only has the economy been a hardship, but in May of 2010, their leader was diagnosed with cancer. Not only were they short-handed, but their owner/leader was battling cancer for 7 months out of that year, and their team still won the award! In fact, billing went up 20%! Diamantopoulos couldn’t be more proud of her team.

When asked how her team took the news of her cancer, Diamantopoulos said it all happened so fast. She found a lump April 26^th, she was diagnosed May 5^th, and her surgery was May 15^th. Her team was scared for her and the company, but they rallied together and wanted to make her proud. Adding to all this, her husband, Craig Diamantopoulos, was diagnosed with cancer in July!

They are both in recovery now, and doing well, and she attributes this to all the support and prayer she received from her team at Athena and the entire community here in the Inland Empire.

Diamantopoulos said that the Inland Empire is a great place to have a Focus Group Facility, as national companies like the fact that economic journals repeatedly mention that the Inland Empire is a barometer of National sentiment. Athena has helped many large corporations find out more about their consumer, namely Nestle, Toyota, Proctor & Gamble and Dannon Yogurt, to name a few.

As a barometer of National sentiment, other interesting marketing facts about the Inland Empire:

• According to a study published by the UCLA Center for Health Policy Research in 2008, Riverside County has the 4th highest rate of obesity in the nation.
• The Inland Empire is the 2nd largest market for full size trucks in the USA.
• More side-by-side refrigerators are purchased each year in the Inland Empire than in any other market.

Athena has also helped politicians keep their finger on the pulse of the people. As the Inland Empire is surveyed more regularly by political pundits than any other region of California due to the area’s reputation for voting the issues regardless of party affiliation.

Looking forward, Lynn Diamantopoulos is excited for the opportunity to serve her clients nationwide, here in the Inland Empire, and with her team, she is positioned to win many awards in the future.

Ronald L. Burgess, Principal at Burgess Management Consulting, CEO at RedFusion Media, Inc.

Redlands, CA, September 1, 2010—Ron Burgess, president of Burgess Management Consulting, will speak on how it is possible to battle the current economic recession with proven marketing strategies that can turn your company’s losses into profits, at an open meeting sponsored by the American Marketing Association-Inland Empire, on September 16 at Riverside’s Victoria Country Club. 

Businesses that really understand what marketing should be about and apply the principles properly can change their fortunes, even during difficult times. Ron will present actual case studies of clients he has worked with for over two decades and illustrate how they consistently out-perform their markets. He will show methods of proven marketing strategies that can turn difficult economic times into new and profitable business opportunities. At this luncheon, Ron Burgess will be presenting a real-life case study of how a home delivery dairy reacted to the recession and the global milk glut to bolster value in the face of declining prices.

Burgess Management Consulting was founded to help clients increase their competitive advantage. Ron is a frequent speaker at marketing industry meetings and author of over one-hundred published articles on marketing. With three decades as a business marketing consultant, Ron brings his unique understanding of the importance of the marketing to small and mid-sized businesses. His personal clients include top market-share performers in agriculture,

industry and professional services.

The luncheon is open to members and non-members of the AMA. R.S.V.P. by September 8 to registrations@ama-ie.com. Networking is 11:30 to 11:55 a.m.; lunch and presentation are 12:00 to 1:30 p.m. For more information, visit www.ama.ie.net.

More on Ronald Burgess

Dismal news can dampen the business spirit, but some success stories do exist.

Such is the story of a dairy where the milkman still delivers milk, right to the door step.

With many thousands of customers dropping the service in 2009, and the price of milk dropping dramatically due to the global recession, competing with grocery store milk at less than half the delivered price created a sudden and serious challenge.

Fortunately the company works from a strong marketing plan, with carefully crafted branding and had just completed a comprehensive customer study that provided the key information that allowed tactical shifts to retain customers and find thousands of new customers to retain the old ones.

The key information: a complete understanding of the lifestyles and buying motivations so tactics could speak directly to customer segments in language they could relate to.

Forming a growth team to coordinate existing customer service and the sales team with the marketing team and consultant, they fought back with new retention materials, reemphasized value using their newsletter, and concentrated on neighborhoods where their best customer profiles lived. They re-built the website with a new sales emphasis and re-built the online customer order center all in a span of about 14 months.

Today even at the bottom of the recession they have replaced thousands of customers and will hit a new record number of customers any day now. This remarkable success during a down turn is inspiration for other struggling companies as we look for signs of recovery. But it does not come easily. Very specific marketing tools used by seasoned marketing pros and strong outsourcing partners are almost always necessary to supplement most smaller companies through such a crisis.

The American Marketing Association, Inland Empire, will share this case study with members and visitors Thursday Sept 16^th at the Victoria Club in Riverside.

You can hear lead consultant Ron Burgess of Redlands, walk through the details: the crisis, emergency team building, strategy review, changes in tactics and execution.

He will illustrate the use of data, GIS mapping and award winning materials that came out of the growth team, and share the key elements necessary for your company to apply the principals used.

Few companies can show much growth in today economic environment, let alone completely reverse the trends, but companies that have a grasp of the correct intelligence, and grit can prepare the company and fight back to growth.

With 2500 pages already and thousands more to be written by “staff” Berwick will be a major influence to the drafting of these regulations. The indication is that the middle class will pay for those who can’t or won’t provide themselves with healthcare.

The top 10% of income earners will now pay an additional 3,8% Medicare “payroll” tax surcharge that will apply to investment income.  This makes the new healthcare bill almost certainly the largest transfer of wealth in American history.

Business owners in the Inland Empire can stay informed on the new healthcare bill’s effects on your business at http://www.henehan.com/resources_healthcare.htm.  The Henehan Company is an Inland Empire leader in benefits and group health, and will be having workshops about new healthcare policies in the up-coming months.

Most businesses maintain records on only the sales or revenue of a particular category or department, forgetting to calculate the costs related to the selling of the product.   When this information is captured, too many accounting programs still calculate cost-of-goods sold in three to six sub-categories, with no direct calculation against the same revenue categories.

Many businesses correctly believe that they have all the necessary information, based on their income statement.  I find this to be true in a large percentage of cases, but the structure of most accounting programs and income statements is not for marketing purposes!

Test your financial statements. If you can’t find the gross margin of every category of products or services (expressed as a percentage) for last month’s business within two minutes, you don’t have the tools you need to market by the numbers.

Category management requires businesses to capture the information necessary to determine revenue and gross profit.  While this level of information gathering was difficult for some types of businesses five years ago, today’s advances in computing makes this process much easier to accomplish.  Several inexpensive accounting software programs also have inventory modules today.  These can be critical in gathering the necessay information to determine profitability of  merchandise or service catagories.

Key numbers useful in comparing categories, departments, products or services are:

1. Sales revenues and gross margins
2. Direct selling or distribution costs for each category
3. Approximate fixed expenses related to the category
4. Break-even sales volume in both dollars and units

Using this foundation, information in each category can now be “planned”–what a novel concept!  This enables crucial questions to be answered:

• Does the category represent single sales or repeating sales?
• Is it realistic to sell  more?  (How big is the market?)
• How much more?

If the market for the category is saturated, the promotional strategy is different than if the market is growing; a saturated market is normally crowded with competitors, while the emphases in a growing market is

rapid market development.  Armed with information about your market,  and the profitability of a category, an individual category can be planned for increases in profits.

Many marketing programs are inefficiently designed.   A category products might be planned for an increase by lowering the price.  The plan is that the increase in volume will create better buying leverage and efficiency, boosting profits.  However if the price isn’t low enough and additional money is spent on advertising,  and more salespeople,  the increased business may not yield a profit.   However, many times the accounting is not even able to produce category reports with revenue, less costs to determine the gross profit.  Therefore poor decisions are made about how to increase sales in the beginning.  Add the need to manage as many as hundreds of categories in a company, and it becomes no wonder that profit eludes small business.

In addition lack of marketing information creates quotas based on last year’s numbers, plus a percentage, or equally poor goal setting.  This type of  “top down”  planning creates unrealistic sales goals; they too high to be achievable, or don’t push hard enough to capture the existing market.

These issues are fundamental contributing factors in the downfall of small to medium sized companies.  Without proper understanding of how the numbers affect the market, or how the market impacts financial reports,  maximum success will never be completely achieved.

Ron Burgess is a business development consultant specializing in strategic marketing planning, relationship  marketing and integrated marketing systems.  Burgess may be contacted at www.burgessmanagement.com

Don’t ask your accountant to show you the value of your people on the balance sheet, they don’t know.  Don’t ask him or her to give you a place on your financial statements for the important knowledge your people have, they don’t know how to deal with it!

Our typical accounting systems only track money (and what long-term “assets” it can buy.)  They don’t track the heart and soul of most businesses-the people.  I could go rambling on about the missing information that financial statements present to business owners, concerning all of your “assets”, but our focus here is to discuss the role of the people part of marketing assets.

Because customers are really people making buying decisions, it is no surprise that businesses must respond to them in a personal way with all the subtleties that entails.  These subtleties range from careful voice intonations, to no personal contact at all.  The wide range of customer expectations requires a similarly wide response. Precisely because this relationship is the make or break part of the transaction, it is, in fact, the most important part of the marketing equation.  The accounting department, finance department and your bankers just don’t know how to measure this!

But to be fair, most marketers don’t either. They focus on the customer but can forget to focus on those who care for the customer, the employee.

Employee knowledge, training and intellect make up the corporate know-how.  In marketing a product or service, with heavy competitive pressure and similar pricing, sometimes corporate know-how is all marketing strategists have to differentiate companies.

Today employee know-how is the competitive advantage!  Competitors can match your computers, your phone system, your database software, and your production equipment.  In fact, there is only one thing they cannot match, your people advantage.

So why don’t accountants care about including them in the balance sheet? Why don’t owners and executives pay more attention to the human assets?

Because we are people.  And people are difficult to measure and appreciate.

But there are those who can help measure people, based on validated human assessments in the workplace. “Fifth generation” assessment tools give trained organizational psychologists and certified professionals, the ability to look beyond the interview or performance records, into the reasons people react to certain situations or other people the way they do.  “People usually carry with them history and personal momentum” according to my colleague Richard S. Trafton, Ph.D.  “Many personal characteristics, translate into predictable workplace reactions.”

“Most people have a natural comfort zone that encompasses their usual reactions to most people and situations.”  People have the capacity to work outside their comfort zone for a while.  But, this requires effort and resources.  The more a person stretches outside this comfort zone, and the longer he or she stays there, the more stress and tension is created.  Eventually, we have to move back into this comfort zone.  That is, we go back to doing what we usually do.   Asking someone to work (behave) outside his or her comfort zone is akin to holding one’s arms straight out from the shoulder.  It’s not that hard at first.  But, the longer one does it, the more effort and concentration required to maintain this posture.  Eventually, all of one’s energy and attention are required until eventually, and certainly, the arms go back to their normal position.

So when a person who is naturally detail oriented, and needs quiet to complete intense work, is disturbed by the sales team walking through her space, she can deal with it occasionally.  But when the new open-office space plan puts the sales people in the same workspace, the tolerance will eventually erode, or her performance will diminish.

This is a simple example for illustration; but high level assessments are able to capture complex and varied human characteristics and traits that can lead to a wide variety of performance increases, customer service enhancements, economical pay raises based on performance, and better working communications between different types of people.

Fitting your people to the jobs that are necessary creates a team that plays more like a precision football play. Eleven John Elway’s wouldn’t win the superbowl; Elway would make a lousy pro lineman, not because he didn’t have the desire, but because he didn’t have the body.  “Making Elway a lineman” is just what most employers do to some employees, rendering them totally ineffective at that particular job.  Each part of your team has to play the right position.

We often see a system where performance is rewarded by a new supervisory position.  That is similar to starting everyone as a football center and moving them to the backfield and then quarterback as they succeed in each position.  No team would win with that approach; but that is exactly what most businesses do.

Putting a good market research person in the customer service chair may help him with his understanding of the problem; but many detail oriented statisticians would not be able to keep up the smile for long with customers.  The skill and great attitude of the customer service rep, does not mean that they would be able to calculate a standard deviation.

Placing people in the wrong job, will cause them to under-perform or leave.  And, your customers will notice the difference.

Today’s shortage of good people means that bad employers will lose the good employees.  In small and medium sized businesses, as they grow, entrepreneurs who are well suited to build a new growing company, may find themselves working outside their comfort zone.  When they migrate back to their comfort zone, as they invariably must, they snap at employees, make poor decisions and communicate ineffectively.

The owner and employee relationship has never been as much as a two-way street as it is today. Owners who say they can’t get good employees may not realize there are reasons other than money!  But professionals like Dr. Trafton can assess the owners and their strengths and weaknesses, too.  Sometimes the way a directive is said, is the difference between performance and non-performance.  Managers need to understand when and how to communicate with specific personality and job types.

Marketing is about pleasing buyers.  Only people can do this, if they are suited for the job, the job of marketing is served best.

Ron Burgess is President of Burgess Management Consulting. The firm specializes in Customer Relationship Marketing and marketing technology implementation. He can be reached at 909-798-5737 or www.burgessmangement.com.

Do customers tell you what they mean?

Large businesses can afford to out-source major studies of customer attitudes and satisfaction levels, but most small and medium sized businesses don’t have the budget to buy comprehensive professional statistical services.  Today, with powerful databases and spreadsheet analysis tools, smaller businesses can gather information about customers, but it’s easy to miss important information.

One example of this situation is a small company that has consistently done surveys over the years.  These surveys usually point out small variations in its expected (and admired) service. Recently customer turnover has increased slightly, representing increased costs in customer acquisition.  The recent data from surveys did not indicate any change in the way customers viewed service or quality.  So the data was reviewed with new data about the length of time a customer was with the company.  Because the product is a weekly delivery service, on-going customers who “stop” are easy to measure.

Questions which asked for a rating between 1 and 7 (Don’t Agree to Strongly Agree) on issues of overall attitudes about the company were very strong, in the 5, 6 and 7 range.  A deeper analysis of the data compared a slight variation in these questions with questions having to do with “superior value.” Two questions of this type had a small number of responses in the 3, 4 and 5 range.  Because the value questions also had mostly 6 and 7 answers, only a side by side comparison of charts showed the small variation. (Careful statistical models would have also revealed this, but few businesses have this level of sophistication.)  When the lower answers were broken out of the total group, it was revealed that in-fact there was a direct correspondence with the length of the relationship and the range of agreement with “superior value” question.  In other words, those that strongly agreed that the company provided superior value, were customers longer than those that only moderately agreed.

For the first time it was discovered that the perception of value had a direct relationship to how long a person stayed a customer.  Keep in mind that these same people agreed with the total group that the company was great in every other way!  Only the value questions smoked out the real action of the customers.   Customers were dropping the service while telling the company they were great!  In fact they should have said, “You’re great, but not worth the cost.”  Customers rarely lie, but the questions can be miss-understood.  And sometimes customers really don’t understand their own motivations.

This is a common problem for measuring attitudes about product quality and service performance.  It may be part of the reason large companies try to measure specific characteristics of a product rather than customer attitudes.  It is also the reason market researchers have long attempted to use psychographic data along with demographic data to determine why people buy.  But most smaller sized companies don’t need this level of  “market brain surgery” to learn more about how they are doing.  They do need to start by asking the question and valuing the truth.

My family is constantly embarrassed by my truthful comments at restaurants and with service personnel.  I rarely mention an issue out of anger, but rather out of respect for the company’s difficulty in attaining the truth.  I always ask to have my comments carried to the customer service supervisor, but wonder how many times they record them or care about the comment.  In 20 years of doing this, only one company supervisor thought it would be a good idea to find out more!

Quality companies that want the truth from customers must be ready to pry it from them.  Don’t assume that because they tell you things are fine, that they really are.  A little extra effort can yield the small differences that keep your business sharp.

It used to be that an entrepreneur knew the name and the names of all of the children of each customer who walked through his door.  As his business grew, he might have jotted those names down in a small book he could carry in his vest pocket, just to jog his memory.  As the business expanded with more clients and employees, that notebook expanded into files that expanded into rooms of filing cabinets and forests of paper.  Finally, the art of remembering all of those clients’ names was christened with its own name, CRM.

Content Management Systems

CRM, Customer Relationship Management is the organized and purposeful management of the relationship of an organization’s customers, clients and contributors.  In its mature form, the communications among many customers are accomplished in a way that is specific to the customer.  Rogers and Pepper called this One-To-One Marketing in their best selling book of the same name.

Very small companies sometimes scratch their head on this one; they deal with customers one to one every day! But larger companies that have customer service, sales, and accounting departments, generally lose the direct touch that allowed their growth to the department level of organization.

It’s one thing for a small company to add the database and have the desire for more specific communications with customers; and another, probably daunting experience, to maintain a database that easily interfaces with communications in the typical MS Office environment. Generally, accomplishing all the necessary tasks requires a large system, with big-company budgets to afford the technical people to keep it taped and wired together.

Until recently, the small company has been left out of the huge rush to CRM, based on the scale and cost of systems such as Siebel Systems or PeopleSoft.  These systems are built for the large enterprise and can require months or years to deploy.

The smaller business has been forced to rely on software built for the PC under the general category of PIM or Personal Information Managers, such as ACT or Goldmine.  These systems use databases to organize information useful to many of the contact needs of CRM; but each seems to be focused on a particular function such as sales.  Today, even with Cloud Computing systems like Salesforce smaller businesses still have not mastered this basic need to know your customer better.

One smaller business, The Henehan Company, has solved the dilemma with an application called Commence.  This unique application is like a spreadsheet for CRM.  It has the flexibility to be modified to any business, yet does not require any programming. As a result a company can install the template package and start adding contact information the same day!  When the level of understanding about how to implement CRM in your business is realized, the system can easily be modified to add many fields, automated tasks, and multiple desktops for different levels of need or department functions.  While using an experienced Commence consultant makes sense in many cases, users with the inclination (just like with a spreadsheet) can learn most of the functionality.

Seeing that cost effective solutions are actually available “gets the creative juices pumping.”  Then new processes and people in place can really change the way communication is done, service is implemented and products are delivered.

The Henehan Company is a case is point.  An Inland Empire benefits and executive compensation insurance agency, Joe Henehan has used Commence to completely change the way his company collects, stores and uses client information.  “We are able to attach all products and policies to the client, and all of their employees to all three,” state Henehan.  “Notes, memos and comments can be attached to any number of relevant data.  The information can, in turn, be used to report to clients, deliver faster service and capture all the transactions with clients; something that was previously so time-consuming to record and file.”

The result?  Much better client service at a lower cost.  “We can assist with Cobra and carrier billing issues that can just kill a company without a full time benefits manager.  Commence, and our custom configuration, brings us up to speed with the largest agencies in technology.  Now our small company has the same (or better) technology as larger companies, enabling us to service even fortune 500 companies,” states Henehan.  “We tried doing this with two specialized insurance packages and a full time IT guy for two years, and never got there.”   Surprisingly, Henehan has found that his customized Commence system has allowed his company to act as a corporate memory bank, offering history and continuity to his larger Fortune 500 and publicly traded clients who experience frequent employee turnover.

Henehan has experienced a renewed level of creative thinking about how to accomplish what he used to do as a single agent, with a few clients, 20 years ago.  The Henehan Company can continue to grow and know that the quality of its customer service will not be compromised.

The Henehan Company represents one small company, in an industry with large players, that will be able to survive and prosper based on increased service provided at the same cost to the client.  Today some database programs are cost effective to most small businesses, and in a few years other CRM solutions will exist on the Internet also.

It must be noted that no application is the magic bullet required to really accomplish CRM.  The database (tailored for CRM) is the starting point, combined with coaching from CRM experts, changes in office procedures and continued employee training.  The Henehan Company is an example of how technology and Customer Relationship Management are used as a strategic tool, to grow business.

Customer Relationship Management is a new name for an old idea, an idea that seems to work well when the costs are controlled.  In a world where big companies are using CRM to act intimately like a small company, the small companies can’t forget that this is their primary weapon against larger competitors.  Small companies must respond with the sophistication of large companies, or they lose their advantage.

Customer Centric Organizations

A recent conversation with a veteran businessman during the great recession: “Six Zigma, Lean Manufacturing? They don’t mean a thing when what we need is more volume to hit break-even.”

Phobias on quality can lead companies to spend on over-delivering minutia in the form of tighter tolerances and exacting details. This happens in preference to common sense limitations that are driven by perceived customer value.  Eliminating production defects is a fine goal, but the real issue is the customers’ perception of any defects.  If customers really wanted perfection, the manufacturers’ outlet industry would never have gotten off the ground.  Many people take pride in buying a Polo shirt for $19.95 because a stitch is pulled, instead of the $60.00 retail price!

What was thought to be a noble cause can really be something else.  CRM, Customer Relationship Management has turned from a well meaning philosophy, to packaged software that touts a solution, but is usually only the start of a long voyage.  It is true that gathering data is important to understand the customer, but the company culture that acts on that information (even limited information) is far more important.  The large number of failed and underachieved installations of CRM software is a telling sign of business leadership that has missed the point.  Some experts place the failure rate at 60%!

A Customer Centered Organization is one that focuses all its systems, processes and people on the customer, not the product. A Customer Centered Organization does not  only rely on the accounting system that measures revenue and profit. It does not rely on the old traditional organizational structure that was designed to control communications in the Industrial Age of the 1800’s.

Emphasizing the customer sounds easy (and is accomplished in varying degrees by many companies), but becoming a Customer Centered Organization requires an attitude that is counter to most companies. “Focusing all systems and processes on the customer” may mean scrapping your current accounting system for instance. Accounting systems have always been oriented toward revenue, expenses, profit and assets. Accounting de-values assets bought with cash, but creates no value for strengthening life-time customer relationships!  It measures the cost of employees, but has no place on the balance sheet for the knowledge and skill levels they have!

Most companies start the process of becoming Customer Centered from a disadvantaged perspective based on accounting and a product orientation. The number pushers, and production managers are well paid; the Customer Service departments are entry level jobs!  Even marketers talk of  “differentiation” in their products, then paint them a new color!  With the world production capacity beyond demand, how many products are really different? In-fact the vast majority of products today are in a commodity category.  The vast majority of differentiation is not the product, but service and aesthetics.  Both are controlled by marketing, personnel, and customer service! The Customer Centered Organization elevates the emphasis on the customer, which becomes a competitive advantage.

Becoming a Customer Centered Organization can mean changing a company culture.  It acknowledges that it is “becoming” and may never arrive.  It may be the slow destruction of an existing organizational structure and it regularly sacrifices sacred cows.

One of the most successful retailers in the world has done just that.  Nordstrom’s literally turned the organizational structure upside down.  The president is on the bottom and the sales person on the floor is on the top.  The managers’ and executives’ jobs are to support those above them.  This system is not a new idea; it is a proven idea.  The entire culture is different than the competition’s. Nordstrom sells the same goods as other retailers and has similar stores in similar locations.  But most of their competition buys from the top down, from the merchandise manager to the department manager. At Nordstrom the buyer is king, because he or she must be “on the floor” with the customer.

A Customer Centered Organization has an organizational chart with the customer in the middle of a concentric circle. The first ring (level) includes the all important customer service team, all those that interface directly with the customer. Paper and computer systems are fashioned specifically to gather customer information, not generate invoices.

The information flows to the second level in a way that provides different information for different parts of the organization, yet is accessible to all. Transactional information (deliverables to the customer such as products, services, advice, problem corrections, and communications) are gathered and turned into dollars at the second level.  Physical deliverables (products, packaging, letters) become sales, inventory, and expenses for the accounting functions; while intangible deliverables include services delivered, information passed to the customer, and feedback for marketing functions.

In every case the issue is “what is the complete nature of our relationship with this customer.” Sure it is “One to One” and Relationship Marketing, and market oriented at the same time.  It starts with people relating to people, while gathering information, and ends with compiling numbers for management reporting and financial statements.

This is not easy.  Finding affordable systems that can gather this information is hard, and changing your people culture is harder; but by most measures, tangible improvements occur that even your toughest CFO would love.  Increased profit margins, faster adaptation to markets, faster growth rates, and higher productivity can be documented by companies that are perceived as having higher quality and better service.  A Customer Centered Organization that exists for the customer first, can be the way to your CFO’s heart, once he allows it to work.

How Customer Centered is your company?

http://www.ieweb.us/business/how-much-does-your-company-really-care-about-customers/

Ronald L. Burgess, Principal at Burgess Management Consulting, CEO at RedFusion Media, Inc.

Articles by Ronald L. Burgess

Ron’s Professional & Contact Info

Ron Burgess became involved with entrepreneurship far before it was popular. At the University of Colorado Business School, no courses were offered for small business. Nearly all his classmates went to work forFortune 500 firms. Instead, Ron opened a specialty retail store. Ten years, seven stores, and a small manufacturing plant later, he left his entrepreneurial endeavors and went to work for the nation’s largest retail merchandising consulting firm.

With three years as a field consultant, and four more as the Director of Product Development, he came into contact with hundreds of small businesses and their problems. He also trained scores of business consultants in the area of merchandise planning, inventory control and computerized planning systems.

Itching to be in business again for himself, Ron started Burgess Management Consulting in 1989, specializing in strategic planning, marketing and marketing management. Today he is a “Chief Marketing Officer for hire,” where he works with owners and presidents to grow business and manage marketing initiatives.

Always interested in marketing technology, Ron was interested in the Internet as early as 1996.  Burgess Management Consulting built its first website in 1998, and the next year founded RedFusion Media with son Jon and wife Molly.   RedFusion manages many of the marketing campaigns; brand development, Internet marketing, print and PR of Ron’s client base.

Ron, is a speaker on marketing subjects, and has written over one hundred articles on marketing, the Internet and management practices. He has served on numerous non-profit boards and is currently President Elect for the American Marketing Association- Inlands Empire.

Professional

Principal – Burgess Management Consulting

Founder/CEO – RedFusion Media, Inc.

Affiliations

American Marketing Association – Inland Empire, Board Member & President Elect

American Advertising Federation – Inland Empire, Member

Redlands Rotary – Member

Redlands Fortnightly Club – Member

Social

Companies Turn Online to Manage Marketing Budgets
by Ronald L. Burgess 5/30/2009

Redlands, June 8, 2009 – A fresh study by two respected researchers indicated that 41% of marketers in the business-to-business sectors will maintain this year’s budgets, while 25% will increase budgets. However, with the downturn in full swing, almost half of all marketers say they will spend more on web-related marketing.(i)

With an emphasis on return-on-marketing dollars, many turn to the web, because it is more measurable than traditional advertising; while others look at rapidly fading newspaper and magazine subscriptions and conclude that the Internet is where the exposure is.

By most indications, the Internet is the place to be, but companies without full-time marketing expertise find it difficult to know just where to put their advertising investment. I have included a new study from EMarketer in the table below so you can see how B-to-B marketers intend to spend their money. However, here is a simpler list of what to do in order of importance:

1. Attend to your website. Most websites are much too lean on content and pages. As a rule of thumb, if you are a very small company, add at least one new page every month. If you have more than 10 employees, add two to four pages per month. If you have over 50 employees, setup a monthly budget to spend solely on content. Make sure all your pages are ranked by Google (if not, have your site rebuilt to achieve this).

2. Study your web statistics. Learn how this works or use a web company large enough to have specialists for analytics and SEO.

3. Tone up your website’s online pitch and close. Few websites develop compelling asks and closes. Each industry has different selling cycles. The use of relationship building tools (like whitepapers and blog subscriptions to get contact information) is one online way to begin a long cycle.

Adding videos of well thought-out pitches and demonstrations moves toward a close, and compelling offers finish the deals. This can be expensive to translate to the web, so plan on spending a large percentage of a sales’ person’s salary to do this right. If you can increase the effectiveness of your website, your sales’ people will spend less time on getting the check.

4. Devote a budget for keyword advertising. Then, adjust your budget based on the cost-per-view and cost-per-lead. Currently, in most industries, this the lowest cost per lead across all media, except for referrals. Expect to spend one-third to one-half of your pure advertising budget on this activity, until you hit diminishing returns (i.e. when the cost per keyword does not yield more visits). RedFusion Media uses a system called Local Target Marketing that automatically reduces the spend when this has been reached.

5. Find ways to write more content (press releases, articles and events) for placement into RSS feeds.

6. You are probably out of online money by now. However if you have more in your budget, seriously consider using traditional advertising on well-placed websites, social networking, as well as using more direct mail to push targeted buyers to your now great website.

Future installments of this column “Keeping Up in a Down Economy” will explore these in more detail. Or, follow the RedFusion Blog.

(i) Forrester Research and MarketingProfs, reported by EMarketer on May 27th 2009

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“Business has just two functions; finding a customer and innovating.” Peter Drucker

“Business has just two functions;  finding a customer and innovating.” Peter Drucker.
by Ronald L. Burgess 6/25/2009

Peter Drucker, perhaps the most noted business professor and philosopher of our time, continued, “everything else is just cost.”

This really provides a different perspective for most businesses where production, finance and accounting rule the roost. Yet it is clear that the innovators are the really big winners. We see it all around us; Apple Iphone, following the Ipod, following on the MacIntosh, following on the GUI (graphical User interface). Or Google with its completely original notion of organizing the world’s information, then inventing a new advertising industry too boot.

And innovation enabling wealth creation is not new. Ford invented a new way to mass- produce cars for lower selling prices, Carnegie developed the Bessemer furnace in the US and drove steal prices ever downward. DuPont developed better gunpowder.

Market domination or even creation; provide great opportunities for wealth creation, as well as many times increasing our standard of living. So why is it that so many business people concentrate on cost cutting, financial leverage and tax avoidance instead of finding customers and innovating?

It is a question that still escapes me too. My three decades of business consulting tells me that many choose to preserve existing wealth rather than risk greater riches. This is not a fault and can lead to comfortable circumstance and company stability. But at the same time if Drucker was right, if the company is not creating a customer, how long will the stability continue?

Recessions usually cause companies to pull back on creating customers. This is a curious circumstance, because new customers can mitigate tough business from existing customers. I find that businesses that make great cuts to advertising and marketing during a recession, really don’t understand why they advertise and how it works in the best times either. Many of these businesses simply do not know the best ways their companies create customers. Instead they put out a shingle and throw money away with wasteful ad spending and are “too busy” to measure for success.

What intelligent business person would cut back on an activity when they know it creates business? Not many, but very few really know what works.

Recessions take out the ones that don’t understand this first reason to be in business-to create a customer. This could be a long recession so its not too late to start, measure the effectiveness of all marketing activates, advertising, distribution, sales, materials and direct mail, website visits and closes, and everything else you can. Pay attention to why each customer is doing business with you. Then just do more of what works, and stop what is less productive.

Tell your CFO or controller, to measure it all, or the financial measurement won’t matter anyway! Nothing happens until the cash register rings.

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Brithinee Electric is Beating the Odds With Quality Motor Repair

Brithinee Electric is Beating the Odds With Quality Motor Repair
by Ronald L. Burgess 5/22/2009

Some companies do thrive in a down economy. A good example of a company that has managed to stay on top, even during hard times is Brithinee Electric located in Colton. While Brithinee Electric finished its best year in 2008, it has had another record month already in 2009.

Brithinee Electric repairs and sells large industrial motors and fabricates motor controls. While some of their customer sectors are down, others are up because they depend on their factories to keep running, or for water to keep pumping.

One very successful part of the motor business is the wind generating industry. They have created reliability in motor repairs that is becoming legendary in the industry. So far, for instance, Brithinee Electric has zero failures in the wind generator-repair business, and has become the envy of many in the industry.

“Many large generators are failing now, after ten to twenty years of service, so many need to be re-wound. The emphasis on wind power seems to be helping, as well,” states Wallace Brithinee, president. The Brithinee brothers, Wally and Don, have provided innovation to an industry that has been stuck in the nineteenth century. They have set up standards to “over-engineer” the materials. According to Don, “When a generator has to be lifted down from a tower at the rate of $12,000 each time, we don’t want to have failures.”

“We started a serious marketing program five years ago, when business seemed flat. We shored up our primary markets, and added new clients as competition huddled. We saw an immediate bump in business, which continued through 2008. 2009 will probably not see the nice increases in business, but so far we’re solid.” Don stated.

Having a well-oiled customer awareness program in place prior to a recession has gone a long way towards maintaining this successful business during a recession. In Brithinee’s case, quality work, a strong marketing program, years of building a credible reputation, combined with innovation in the industry, is carving out a larger market penetration in the marketplace, while other shops recede and fail.

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Companies Turn Online to Manage Marketing Budgets

Paramount Windows and Doors still fits their niche —even during troubled times.

“Business has just two functions; finding a customer and innovating.” Peter Drucker

Paramount Windows and Doors still fits their niche—even during troubled times.
by Ronald L. Burgess 5/30/2009

Not everyone is doing so badly in the tough economy. Some companies have seen very little difference in sales volume in the last two or three years. A good example of a company who has managed to stay busy, even during hard times is Paramount Windows and Doors of San Bernardino. Although closely aligned with the devastated construction industry, Paramount’s sales are down only a few percentage points over two years ago.

Paramount Windows and Doors has implemented aggressive cost-containment programs in the last two years, freeing up cash and allowing more aggressive pricing strategies to be offered to dealers. Some of that money has been invested in marketing to bolster sales.

“The first thing we did was to build one of the best websites in the industry. The next thing we did was to update all of our materials. We also hired an outside marketing expert to completely review our marketing approach,” stated owner, Don McFarland,

McFarland takes customers seriously, so he hired a new person to take on some of his management duties to free his time for personal calls to dealers. “We have added new products, increased service, lowered prices, and increased the quality of our products,” he says, “And, I personally call on my primary customers, now.” While Don is involved in the field aspects of the business, his wife, and co-owner, Judy, keeps tabs on the office and estimating functions, while trusted managers supervise about 40 craftsmen.

“I think our sectors are doing fairly well, certainly better than building in general; but, we go the extra mile to be competitive with our dealers, and give them what they want. That’s why our guys are still working.” Paramount Windows and Doors produces furniture-grade wood windows, using a large variety of different kinds of woods. Although every window and door is custom made, they still manage to deliver basic windows in as short as five working days.

Business may be tough for the construction business, but Paramount is fortunate to be in two areas not as adversely affected by the economy as the new housing market: restoration projects and high-end custom remodels and construction. Paramount’s example makes one thing certain—organized marketing execution can create an edge in tough times, but when a company’s owner seriously increases the pace of customer contact, it’s a winning combination.

Other articles in the “Keeping Up in a Down Economy Series“

Companies Turn Online to Manage Marketing Budgets

Brithinee Electric is Beating the Odds With Quality Motor Repair