Category : Entrepreneurs
Tips and tricks for transitioning your physical business online
Transitioning your physical business online is a good choice in the modern age of digital business. It’s all about the internet and selling online. Customers aren’t shopping in brick and mortar businesses as much as they did years ago, and it’s obvious the trend is going digital. But where should you start? In 2017, over 40% of shoppers in the US shopped online several times per month according to Statistia. That’s a big percentage, and it’s only going up! You need the best tips and tricks to stay competitive if you’re transitioning your physical business online. Here’s a guide to smoothly making your transition from in-person business to online business. Choose the right selling platform Your first step when searching for the perfect way to sell online is finding the right platform. You have two main options: sell on an existing platform or create your own. Examples of existing platforms include Etsy and eBay which already have a customer base. While it’s easier to find new customers on these existing platforms, you also lose some control when selling with them. If you do choose to build your own website, there are a lot of tools for easily integrating selling on your website. Shopify is the most common platform for e-commerce and it’s easy to get started with. It's easy to modify to fit your brand and products, and everything just works, right out of the box. Your customers don’t have a lot of time to search your website for exactly what they’re looking for. The easier your website is to navigate, the more customers you’ll convert! That said, the choice for the best ecommerce platform often comes down to Shopify vs Magento. Find a good merchant account With your selling platform comes your merchant account. This is how you’ll process payments through your website, and it can make or break the user experience. Your merchant account is one of the most important aspects of e-commerce reported ExpertSure. When choosing a merchant account, less is more. One of the biggest problems facing online sellers is abandoned carts. You can cut down on this number of people leaving before entering their credit card info by making it as quick and simple as possible to checkout on your website. If you master these basics of building an online store on a platform like Shopify, your transition to online will be as smooth as possible! Did you know that you can even use the Shopify POS for selling offline as well? [subscribe] Be active on social media - but not overly salesy Now that you’ve chosen the right selling platform, it’s time to take your online presence to social media. Social media is to business today what print ads were to businesses 20 years ago. Social media has a lot of power today. According to WordSteam, over 60% of Americans are active on Facebook! If you want to make a splash with your marketing, you need to be on social media. As an e-commerce business, you might think you should be selling on social media. This isn't’ the case! Instead, focus on building relationships with your audience. Create valuable content that your users actually will want to share, and you’ll convert more users into buyers! As as an online business, social media is your first line of interaction with your audience. Why move your business online? In today's market, everything is online. It’s not enough to have a brick and mortar store. People want to be able to shop 24/7 and without worrying about holidays or store hours. An online business never takes days off. It doesn’t have to hire a store clerk or a cashier. There’s a lot of upfront work when setting up the website, but once you’ve established the right platform it’s smooth sailing as long as you have the right marketing strategy with free analytics tools to make sure you're tracking sales, marketing and e-commerce checkout steps. You might need to outsource your online marketing work, and with a good reason. This free Google AdWords PPC wasted spend calculator tool by Fang Marketing shows just how much of your marketing budget you can waste away by putting it to a bad use. As you transition online, you cannot afford such wasting, so it’s a smart choice to actually find a professional to help you target buyer personas and increase ROI (Return on Investment) for those campaigns. For example, using buyer personas to adjust Facebook Ads is an art...and a science! One more reason is having your stuff out of the office and working online as a way of taking down the overhead costs. Sure, some may decide to still go to a coworking space like Spacious or WeWork, but those costs won’t come near the downtown shop with office space for all employees. Just keep in mind that some cities may observe local holidays and you should make sure to find a strategy to keep your shop open without breaking any labor laws." Succeed in the digital age It’s not enough anymore to just set up your shop online and expect to see growth! E-commerce today is all about listening to users and connecting with your audience online. It’s easier than ever to transition your business online, but once you’re there you need the right strategy to get seen. Follow these tips above to create a strategy that works today and beyond! Have you had a unique experience bring your brick-and-mortar store online? Do you have tips for other old-school stores looking for the best route to ecommere success? Let me know your thoughts in the comments section below. This is a guest post by Ashley Lipman, outreach manager at Expertsure.
The 5 worst arguments for boosting Bitcoin
I’m exasperated reading dodgy logic justifying the heady ascent of Bitcoin. What are the worst 5 arguments I’ve heard? Full disclosure: I don’t own any Bitcoin, or have any bets on its rise or otherwise. 1. Bitcoin is an insurance against the collapse of capitalism The booster The rise of artificial intelligence and mass joblessness will sweep away much of the old order of nation states and their currencies. Bitcoin is independent of government and will survive the coming storm. A grain of truth I believe big change in the relative value of labour and capital, and how they contribute to the tax base, is coming faster than politicians expect. And the reactionary backlash in affected countries, such as those voting for Donald Trump, won’t stop this trend. The sceptic Bitcoin relies on a chain of other technologies which may well get disrupted with the collapse of capitalism: cheap power supply, a global internet and secure online vaults to hold the private keys and transact the Bitcoin. If you’re betting on the end of the world as we know it, hunting and farming skills are going to be more useful! 2. Bitcoin’s limited supply makes it deflationary by default The booster Unlike fiat money (e.g. the US dollar) which can be printed at will by central banks, the total number of Bitcoin is mathematically limited to 21 million. That means, as other currencies inflate, Bitcoin will hold its value – i.e. it’s digital gold A grain of truth As developed countries around the world are forced to borrow themselves out of the hole of shrinking tax bases and increasing healthcare costs, they may try to inflate their currencies to erode the debt. The sceptic Central banks have a positive inflation target for a reason: in a deflationary currency, no-one wants to spend the currency and so there’s no circulation of wealth. If one Bitcoin could have bought me a coffee in 2016, but at the time of writing could have bought a car, why would I ever spend it? And if no one spends the currency then it has no tangible value. [subscribe] 3. Bitcoin is the leader of the blockchain revolution The booster Blockchain is one of the few game-changing technologies to be invented the last two decades. It will revolutionise the world of finance, and you need to own Bitcoin to be part of that. A grain of truth The blockchain ledger, keeping a public record of all transactions, and reducing the possibility for fraud or interception, will certainly change many aspects of finance. There are many projects underway in financial trading and government. The sceptic Just because Bitcoin was the first use-case of the technology, does not make it essential to newer blockchains. Equally, its first-mover advantage may not even make it the winning cryptocurrency. That said, I wouldn’t go out buying a basket of other cryptocurrencies just yet – they are all overinflated by Bitcoin’s rise. 4. The increasing mining cost of Bitcoin underpins its value The booster New bitcoin gets exponentially harder to mine, so since the cost of electricity for the miner’s servers won’t fall, the cost per bitcoin mine is rising all the time. And if you can’t mine them, you’ll have to buy them. The sceptic Yes.. but what if no one needs Bitcoins at all? Mining gold is subject to the same economic forces, but if the gold goes out of fashion as a value store (as it did an the turn of the Millennium) it still had industrial value for conducting electricity and aesthetic value for jewellery. Bitcoin has neither of those. 5. The rise of bitcoin is 2017 shows it has won out as the cryptocurrency of choice The argument Bitcoin is now the established alternative store of value, which is why it has risen so fast in 2017. And what if all the pension funds and institutional investors now buy up a slice to ensure an allocation of this new asset class? A grain of truth There’s no rational way to value Bitcoin: it does not pay dividends or have intrinsic worth (see point 4). So it could be worth anything .. or nothing. The sceptic Every decade a new mania comes along for investors to follow. The vast chatter on LinkedIn, Facebook and other forums only heightens the mania by allowing unchecked falsehoods to flourish. You only have to look at the South Sea Bubble and Tulip mania to see there is nothing new under the sun. Enjoy the roller-coaster ride up .. because everything that goes up, must come down.
Littledata at Codess
I was proud to be invited by Microsoft to speak at their Codess event in Bucharest last week to encourage women in software. We talked about how Littledata uses Meteor, Node and MongoDB to run scalable web applications; slightly controversial because none of these are Microsoft technologies! The event was well run and well attended, so I hope it inspires some of the attendees to start their own projects...or to join Littledata (we're hiring).
TechHub London demo roundup
Last night we gave a live demo of the Littledata app at TechHub London's Tuesday demo night. It's always exciting to share Littledata with other entrepreneurs and business owners, and to get their feedback about Google Analytics issues (everybody has some!). But in this post I'm putting our app aside for a moment in order to share some thoughts on the other company demos from the event. After all, isn't sharing feedback and ideas what the TechHub community is all about? My Film Buzz MyFilmBuzz is an early stage mobile app – launched eight weeks ago with 150 users. The user interface is really intuitive; making use of great visuals from movies and Tinder-style swiping to rate movies. The commercial problem is competing with established players like Rotten Tomatoes with big established audiences. Can a better interface tempt film viewers away? HeathClub TV HeathClub TV offers personalised training videos and exercises, selling via personal trainers who create their own profile and packages. A bit like Udemy for personal training courses, the trainers take a cut of the course fees. Again personal fitness is a very competitive market – the founder said one competitor spent £1.5m on their first version mobile app. I’ve personally enjoyed the 8-fit mobile app, with a similar mix of video exercises but without the marketplace for trainers to produce content. It will be interesting to see if the user generated content model wins out in this market. Trevor.io Trevor helps companies visualise data sources from their own business, such as SQL databases. The user interface makes a good job of simplifying a complex task, switching between table and graph views. As a data geek, I love it! We thought about a similar product in the early stages of Littledata, so my big question is: how many users have the analytical knowledge to create the data integrations, but aren’t comfortable using SQL or similar. At Littledata, most of our analysts progress to coding, because it makes them quicker to do the analysis – but then we are an unusually techy company. Grocemania Grocemania allows customers to place orders from local retailers, charging a small delivery fee (£2.50) and small minimum order (£10) subsidised by 15% commission from the retailers. They have launched a pilot in Surrey with nine retailers. The strategy seems to be to undercut other delivery companies, with lower delivery costs from freelancers and passing stock control onto the retailers. The presenters got a groan for highlighting how they reduce employment costs, but my real concern is how they can profitably undercut companies like Amazon who are ruthless pros at retail and delivery. [subscribe] Worksheet Systems Similar to Trevor, Worksheet Systems aims to solve the problem of storing lots of data in interconnected spreadsheets. Their idea is to split the user interface and database inherent in a complex spreadsheet, and present as a kind of Google Sheet – rather than the customer building an actual database. It looks really powerful, but I wasn't clear what it can do that Google Sheets doesn’t; we use Sheets for lots of smaller ‘databases’ in Littledata, and it’s both simple and powerful. Crowd.Science Crowdfunding for scientific projects, helping scientists raise money from individual donations, business sponsorship and charitable trusts. They take 5 – 10% commission of the money raised. It seems like a great model: crowdfunding is well proven in other areas, and some scientific projects have real public benefit. As the trustee of a grant-giving trust, I know the way we find projects is fairly inefficient, so this platform would be a great benefit as it takes off. Realisable Realisable is an Extract, Transform and Load (ETL) tool, with a visual business rules editor to transform a data source. Their live demo uses a job to transform unshipped orders from Shopify into a format that can be exporting to an accounting package, adding a customer ID to the transactions. I investigated this market in 2016, and there are some very big companies in the ETL market. Many of their products suck - a great opportunity - but there are ones with better user interfaces like Stitch Data. Talking to the founders afterwards, their strategy is to dominate a channel (in their case, Sage consultants); I know this has really worked for another ETL tool, Matillion for Amazon RedShift. Conclusion What’s my favourite idea (outside of Littledata)? Crowd.Science has the biggest potential commercially I think, but I do love Trevor’s product.
The Freemium business model revisited
After I concluded that freemium is not the best business model for all, the continued rise of ‘free’ software has led me to revisit the same question. In a fascinating piece of research by Price Intelligently, over 10,000 technology executives were surveyed over 5 years. Their willingness to pay for core features of B2B software has declined from 100% in 2013 to just over 50% today – as a whole wave of VC-funded SaaS companies has flooded the market with free product. For add-ons like analytics, this drops to less than 30% willing to pay. “The relative value of features is declining. All software is going to $0” – Patrick Campbell, Price Intelligently Patrick sees this as an extension of the trend in physical products, where offshoring, global scale and cheaper routes to market online have led to relentless price depreciation (in real terms). I’m not so sure. Software is not free to manufacture, although the marginal cost is close to zero – since cloud hosting costs are so cheap. The fixed cost is the people-time to design and build the components, and the opportunities for lowering that cost – through offshoring the work or more productive software frameworks - have already been exploited by most SaaS companies. To pile on the pain, a survey of software executives also found that the average number of competitors in any given niche has increased from 10 to 15 over those 3 years. Even if software build costs are falling, those costs are being spread over a small number of customers – making the chance of breaking even lower. And the other big cost – Customer Acquisition (CAC) – is actually rising with the volume of competition. To sum up the depressing news so far: 1. Buyers have been conditioned to expect free software, which means you’ll have to give major features away for free 2. But you’ll have to pay more to acquire these non-paying users 3. And next year another competitor will be offering even more for free What is the route of this economic hole? Focussing on monetising a few existing customers for one. Most SaaS executives were focussed on acquiring new customers (more logos), probably because with a free product they expected to sweep up the market and worry about monetization later. But this turns out to be the least effective route to building revenue. For every 1% increment, Price Intelligently calculated how much this would increase revenue. i.e. If I signed up 101 users over the year, rather than 100, that would increase revenue by 2.3%. Monetization – increasing the Average Revenue Per User (ARPU) – has by far the larger impact, mainly because many customers don’t pay anything currently. In contrast, the impact of customer acquisition has fallen over 3 years, since the average customer is less likely to pay. Monetization is not about increasing prices for everyone – or charging for previously free features – but rather finding the small number who are willing to pay, and charging them appropriately. My company, Littledata, has many parallels to Profit Well (launched by Price Intelligently). We both offer analytics and insights on top of existing customer data – Littledata for Google Analytics behavioural data, and Profit Well for recurring revenue data from billing systems. And we have both had similar customer feedback: that the perceived value of the reporting is low, but the perceived value of the changes which the reporting spurs (better customer acquisition, increased retention etc) is high. So the value of our software is that it creates a requirement – which can then be filled by consulting work or ‘actionable’ modules. For myself, I can say that while focusing on new customer acquisition has been depressing, we have grown revenues once a trusted relationship is in place – and the customer really believes in Littledata’s reporting. For Littledata, as with many B2B software companies, we are increasingly content that 80% of our revenue comes from a tiny handful of loyal and satisfied users. In conclusion, while the cover price of software subscriptions is going to zero, it is still possible to generate profits as a niche SaaS business – if you understand the necessity of charging more to a few customers if the many are unwilling to pay. Freemium may be here to stay, but if customers want the software companies they rely on to stay they need to pay for the benefits. Would you like to further discuss? Comment below or get in touch!
Making the detection of significant trends in your traffic easier to see
Our core belief at Littledata is that machines are better at spotting significant changes in your website’s performance than a human analyst. We’ve now made it easier for you to get specific alerts, reducing the time spent wading through data. This is the story of how we produced the new trend detection algorithm. Enjoy! Back in 2014, we developed the first version of an algorithm to detect if today or this week’s traffic was significantly different from previous periods. This allows managers to focus in on the aspects of the traffic or particular marketing campaigns which are really worthy of their attention. Although the first version was very sensitive, it also picked up too many changes for a single person to investigate. In technical language, it was not specific in enough. In June and July, Littledata collaborated with a working group of mathematicians from around Europe to find a better algorithm. The European Study Group with Industry (ESGI) originated in the University of Limerick’s mathematics department in Ireland and has helped hundreds of businesses link up with prominent mathematicians in the field to solve real-world problems. Littledata joined the latest study group in University College, Dublin in July, and was selected by a dozen mathematicians as the focus for their investigation. Andrew Parnell from the statistics department at University College, Dublin helped judge the output from the four teams that we split the group into. The approach was to use an algorithm to test the algorithms; in other words, we pitted a group of statistical strategies against each other, from clustering techniques to linear regression, through to Twitter’s own trend detection package, and compared their total performance across a range of training data sets. Initially, the Twitter package looked to be doing well, but in fact, it had been developed specifically to analyse huge volumes of tweets and perform badly when given low volumes of web traffic. In between our host’s generous hospitality, with Guinness, Irish folk music, and quite a lot of scribbling of formulas on beer mats, myself and our engineer (Gabriel) worked with the statisticians to tweak the algorithms. Eventually, a winner emerged, being sensitive enough to pick up small changes in low traffic websites, but also specific enough to ignore the random noise of daily traffic. The new trend detection algorithm has been live since the start of August and we hope you enjoy the benefits. Our web app allows for fewer distractions and more significant alerts tailored to your company’s goals, which takes you back to our core belief that machines are able to spot major changes in website performances better than a human analyst. If you’re interested in finding out how our web app can help you streamline your Google Analytics’ data, please get in touch! Further reading: 7 quick wins to speed up your site analysis techniques Online reporting turning information into knowledge Will a computer put you out of a job?
SEIS support covers over 100% of your startup investment risk
Until recently I hadn't understood how generous the Seed Enterprise Investment Scheme is for investors in early-stage companies. Investors can put up to £100k in qualifying companies, as long as they don't control more than 30% of the SEIS company. There are three overlapping benefits which mean you can recoup over 100% of your investment in tax offset if the companies goes bust, and get a 5x boost to the value of your initial investment if all goes well. It sounds too good to be true, so use your allowance while it is still open! Let's assume that you are an additional rate (45%) tax payer, and want to invest £10,000 of capital gains into an SEIS company. What happens if that company eventually goes bust? A. Reinvestment relief Firstly you get a 50% reduction in the capital gains tax bill from gain reinvested. If you realised a gain of at least £10k over and above the capital gains tax allowance from selling shares or property, then you can reclaim the tax on the amount you reinvest in the SEIS company. At the 2014/2015 higher rate of 28% that is: + £2,800 B. Income tax relief Next you can write 50% of your £10k investment off against your income tax bill from this year or last - even if you didn't directly use that income to invest in the SEIS company. +£5,000 C. Loss relief If the company goes bust, then you can write a further 45% (your marginal tax rate) in the year you claim against your income tax bill. 45% times the £5,000 of investment the tax payer didn't originally fund. +£2,250 So of that £10k you have already recouped £2,800 + £5,000 + £2,250 = £10,050 from HMRC. Leaving you with a small gain to cover the inconvenience. But look on the bright side! What if the company sells for double the value in a few years' time? This time you still get benefits A & B, but also keep the proceeds free of capital gains tax. So you put in £10k, but take £7,800 back off your tax bill, leaving you with £2,200 net exposure. When you sell the shares for £20k, you have multiplied your capital at risk 9 times An investment in an equivalent non-SEIS company would have yielded £20k, less capital gains tax of £2,800 = £17,200 (1.7x your investment) So you get more than five times the net gain from the SEIS investment.
How to create a strategic marketing plan
You know marketing is essential but have you specified what makes you different and unique, your objectives and how you are going to achieve them? Recently I went to a workshop, organised by Innovate UK and Enterprise Europe Network, to do just that: learn about achieving business goals by using strategic marketing. Strategic marketing is essentially a structured plan that helps you achieve competitive advantage or other business goals through a set of defined activities that are most appropriate for your aims. We were taken through a number of exercises that helped us define how we position ourselves and what we are trying to accomplish, whilst aligning the marketing efforts and tactics with overall business goals. It was especially useful to bounce my ideas off others so if you’re going through similar exercises, I recommend you do the same. It really helps to sense-check your thoughts and how you describe your business with someone outside your company. Below I'll go through my top takeaways and methods that I found most useful when devising a strategic marketing plan. Define the purpose/mission of your business Think about what you are trying to achieve as a business – is it clear or does it need further refining? Why are your services and products needed or wanted, and who are your customers? If you have a clear purpose or a definition of what you’re trying to achieve, it will help you plan your marketing activities and inform other business activities. Having an easy to understand idea of your purpose also helps guide your resources and avoid spreading them too thinly, which is especially valuable if you’re a small business where resources are limited. Define your value proposition A value proposition is what you promise to deliver to your customers through your services or products. Here you need to think what makes you unique, better or different from your competitors. If you struggle to offer a reason why your offering is more valuable than your competitors, then you may get stuck competing on price only. I found the Geoffrey Moore’s model particularly useful for defining the value proposition. It goes like this: The ____________ (product name) Is a ____________ (product category) for ____________ (users/customer segment) who ____________ (statement of desire/problem) that ____________ (compelling reason to use) unlike ____________ (the next best alternative) allows ____________ (the main difference). And here’s an example we were given: The iPod is a portable music player for music lovers who want to listen to their music anywhere, anytime unlike portable cd players or MP3s with less storage the iPod allows easy access to all your music Define your marketing goals We used SMART method to define 3-5 marketing goals for the next 12 months. Being specific about the number of goals you’re trying to achieve within a year helps to focus on specific outcomes you’re trying to achieve. It also helps to measure your success after 12 months or another timeframe you set for yourself. Specific - clearly defined and specific goal rather than a generic and vague one, eg increase signups Measurable - quantifiable goal, eg how much or how many Achievable – realistic to complete within a set timeframe, eg a few months Relevant to you and your customers - choose what matters or matches needs Time-bound - that you have the time, money & resources to achieve your goals within a specific timeframe Define your segmentation, targeting and positioning Segmentation is an activity where you divide the broad market into specific customer segments by their common characteristics, and devise your tactics around targeting each segment. A few ways you could segment your customers are demographics, geography, psychographics, lifestyle, behaviour, etc. Once you have a clear idea of different customer groups, you will be better placed to pick the most attractive or suitable segment to target. When selecting your target segment, see if there are segments that are the easiest, cheapest or quickest to reach, whilst being realistic about your capabilities and resources to target those segments. Positioning your business gives you a distinct image of your benefit(s) to the target audience that you are going to communicate. If you have a number of segments you can target, then define your positioning for each segment. Same applies to the Geoffrey Moore’s value proposition model – write it out for each customer segment. Define your marketing tactics Once you have a clear idea of the customer segment(s) you’re targeting, why they would use your services or products, and what you’re going to communicate to them, you can pick specific marketing tactics that are going to help you do that. Some examples of tactics are producing ebooks, using online ads like PPC, sharing data findings via blog, and organising webinars. If you need inspiration or ideas, there are plenty of resources online when you search for marketing tactics, marketing strategies, growth tactics and similar. Define your marketing KPIs Decide on a set of metrics that you are going to use to measure the success of your marketing efforts. By having the right KPIs, you can evaluate if you’re on track towards your goals, and adjust your activities if necessary. To give you a few examples of what you could measure: Cost per lead or enquiry Average order value Landing page conversion rate Customer lifetime value Impressions / clicks / visits I hope this has helped you to start thinking about defining your business and marketing activities more strategically and in line with the over-all goals. There are lots of great templates online that you can use to assist with outlining your plan - for example, check out Smart Insights resources bank that has lots of useful PDFs for marketing planning and more. If you'd like to discuss further, comment below!
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