What Business Are You Really In?

Many people think that the automobile brought on the death of the buggy whip manufacturer. Not true!

Buggy whip manufacturing still exists today. But it's safe to say the market for buggy whips isn't what it used to be.

Many people believed the internet would be the end of printed newspapers. Again, not true. Many fine newspapers still exist, although they are under increased pressure.

What do buggy whip manufacturers, newspapers, and your business all have in common?

They all must understand the business they are in.

Some argue that buggy whip manufacturers could have survived and thrived if they had noticed the changes and responded more quickly. But if they continued to believe they were in the buggy whip business they never could. The only way they could have made the transition would have been if they knew they were in the transportation initiation business.  A buggy whip initiated the motion of the horse and buggy.

Buggy whip manufacturers are not needed unless you want to initiate transportation via horse and buggy. For buggy whip manufacturers to truly survive they would have needed to fundamentally change their focus of manufacturing to starters for internal combustion engines.   This would have resulted in a new target market for their products.  Nonetheless, buggy whip manufacturers could have survived had they focused on their core business of transportation initiation.

Newspapers are not needed without advertisers (with all apologies to fine reporting and information dispersion).  Newspapers are more likely to survive and transition with the times because they recognize they are in the business of aggregating audiences for advertisers. The delivery of news and information is a by-product of the need to bring audiences together for advertisers.

According to Peter Drucker, "The purpose of a business is to create and keep a customer."  I would argue that is only partially true.  The actual purpose of a business is to create and keep the right customers.  While newspapers create subscribers who are customers, they would be hard pressed to survive on subscribers alone.  They bring together two groups of customers to create a value.  Subscribers receive value from the information from the publication.  The advertisers receive value from the exposure to the subscribers who are likely candidates for their products and services.

Regardless of the eventual outcome of the changes in the newspaper business, it is safe to say that many will survive and transition to a new model because they understand the business they are really in, aggregating an audience for advertisers.  The subscriber base is essential to the advertisers and monetizing it is an added bonus.

What about your business?  Are there ways to increase the value you bring to your "right customers" that would increase your business value? What is the real purpose of your business?  Who are your "right customers"?

By answering these questions you can answer the ultimate question, "What business am I really in?" When you identify this core fact you'll be in a position to dominate your marketplace.

by admin

Stand Out In The Crowd: Sponsoring Gives You Exposure - Hosting Gives You Access

If you are seeking a way to stand out from the crowd, perhaps no better opportunity exists than to host or sponsor an event that brings people together.  Whether it's just an intimate group or a large crowd, hosting and sponsoring events provides excellent exposure, however there are significant risks as well.

Sponsoring an event is different from hosting an event.  To sponsor an event usually means that you are providing financial or in-kind support of an event produced by others.  A good example would be if you sponsored a local chamber of commerce luncheon.  You could provide financial support that would assist in promoting the event or paying for the lunch for the attendees.  Perhaps you could provide meeting space for a chamber mixer.  Or you might provide the printed invitations to the annual dinner.  In these examples, you would provide financial support either directly through cash payment or indirectly through in-kind service.  Both are important to the success of the event and you would be recognized as a sponsor of the event.  The chamber would do the rest.

Hosting an event is similar in that you would provide financial support through cash or in-kind service, but then you would also be producing the event.  You would invite the attendees, coordinate the venue, food, parking, and all the other aspects of the event to ensure it's success.  Hosting an event is not for the faint of heart but the rewards often can be greater.  When hosting an event, you control who comes to the event since you have invited all the guests.  You can create the atmosphere that works best for the attendees and for you.  Done well, hosting an event can pay off in a big way.

Whether hosting or sponsoring, the exposure you and your company receive is invaluable.  Most people assume that sponsor and host companies are better established, more financially sound, and therefore better able to serve customers and clients.  Many companies use sponsorships to position their brand as a player in key markets that matter to them most.

A local bank is usually a big supporter of the local chamber of commerce while an energy or gas company may be a big supporter of green initiatives and programs.  The key is to find the group of people you wish to influence and target them with your sponsorship.  Often companies recognize that other organizations produce events better than they can and that they can gain influence through sponsorship of chambers and other cause centric groups.

Hosting events gives you the opportunity to reduce the target group to the key people you choose.  While sponsorship provides exposure and the opportunity to influence, hosting provides the opportunity to interact.  Often the cost of hosting an event is not much different than sponsoring an event, but the cost in hours of planning and executing can easily exceed the financial investment.  Nonetheless, if you or your staff have the ability to host an event, your investment will be easier to track than it will be when sponsoring events.

Most people and companies begin by sponsoring events.  This is a good place to start establishing your brand presence.  You will get noticed and we highly recommend sponsoring events that are congruent with your company mission and that attract your target market.

But we can't urge you strongly enough to try hosting an event as well.  Start with a goal that is small and easily managed.  Perhaps you could invite six clients, prospects, or potential networking partners to a get together over coffee at your office.  Start small and learn through the experience.  Then expand your events to include more people, different formats, and different venues.  You may find it easier to spread the responsibility by co-hosting with a few friends, partners, or vendors.  And remember, vendors who sell you products that you ultimately sell to others are good prospects for sponsoring your hosted events.  You will need to have a few successes under your belt before you will get vendor co-op dollars.

A bit of caution:  While it does happen, rarely do people hold sponsors accountable when an event isn't a total success.  But when you host an event you will be the sole party responsible for the experience of the attendee.  If it goes well or if it goes poorly, you will receive the credit.  So plan well.  Additionally, people are becoming event-fatigued.  Unless your event has a unique twist, you may have trouble succeeding.  That's why putting a few people together that have a common interest is key.  If you are unsure how to put the right people together or what to do to make the event appealing and different, we can help.  Just email us.

Sponsoring the right event or series of events can put you in front of your target market in a way that no other advertising can but it is hard to measure.  Hosting an event with the right invitees can position you and your company as the industry leader regardless of your experience.  Remember, people do business with people they know, like, and trust.  When they attend a well-run event that you have produced, they will get to know, like, and trust you much more quickly.  Try sponsoring or hosting events to make your business grow.

by admin