Sunday, June 21, 2009

Eight Ways to Engage Employees and Power-Up Performance During a Recession

If you've seen the movie Jerry Maguire, you'll remember the scene where Tom Cruise asks Cuba Gooding, Jr., "What can I do for you?" Gooding says, "Show me the money.

Many employers think that's the key to employee engagement. But any company that THINKS you have to pour money on employees to get them engaged will write off employee engagement efforts during tough economic times. "We just can't afford to do it right now," they say.

In fact, you can't afford NOT to pay attention to engagement, especially during a recession when sales are soft. Employee engagement scores regularly account for up to 50 percent of the variance in customer service scores. A disengaged employee can cost you 30 TIMES as much in safety-related incidents. And disengaged employees are over 85 percent more likely to leave.

Engagement comes not from dollars but from more personal factors.

Eight Ways to Keep Your Employees Engaged for the Long Term

1. Listen to your employees. Most people want to work for an employer who cares enough to listen. The best way to know what your employees need and expect is to ask them—and to listen carefully to their answers.

2. Provide clear, consistent expectations. Vague policies and unclear expectations can make employees feel irritated, unsafe and even paranoid. This leads to your employees becoming disengaged. They click into survival mode instead of focusing on how to help the company succeed.

3. Give employees a sense of importance. This has a greater impact on loyalty and customer service than all other factors COMBINED.

4. Develop opportunities for advancement. The chance to work your way up the ladder is a tremendous incentive for productivity, bonding, and employee engagement.

5. Create good relationships with others in the workplace. If you have a toxic relationship with your employees, you can forget about asking them to put their shoulder to the wheel for the company.

6. Offer regular feedback. If you want to keep your employees moving forward, give them the occasional rudder report. And don't forget positive feedback, which should ideally outnumber the negative by about 5 to 1.

7. Celebrate and reward for successes. Set realistic targets, then reward and celebrate when they are reached. And don't wait for the end of a big project to celebrate. Pick landmarks along the way and go nuts when you hit them.

8. Move from "the company" to "our company." The heart and soul of engagement is ownership. As long as your employees feel they are working to help YOU make YOUR company succeed, engagement will be low. Once you get them to see themselves as partners in the endeavor—making decisions, staying informed, sharing in the company's ups and downs—everything changes. Engagement soars.

Just imagine a workplace in which employees feel important and listened to, in which expectations are clear and feedback consistent, in which relationships and shared ownership are cultivated, advancement is available, and success is celebrated.
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Build Your Virtual Store

At some point, every small business must set up shop online. A website can serve as another sales channel, a place to feature products, or just a resource for more information about your business. But above all, it serves as a communications channel with your customer. Establishing an online presence doesn't have to break the bank or eat up your time. Here's a guide to help get you on your way.
The basics

Register a domain name. Dozens of online registry sites allow you to secure a domain name. Some of the most popular include Register.com, NetworkSolutions.com, and GoDaddy.com. They're all fairly similar, and which one you choose won't really affect anything else about your site, so the main difference is price. In general you can expect to pay an annual fee of about $15, but if you're inclined to comparison shop you can pay as little as $8 a year. Try to pick a domain name that's as simple and intuitive as possible - complicated URLs just make it harder for customers to find you. Most companies simply drop their name into the middle of www and com, as in: www.JetBlue.com.

Set up an e-mail account to receive customer feedback. One of the keys to your Web success is making sure your customers can always reach you. Once you have your domain set up, be sure to create an active e-mail address and post it on your site right away. As your site grows, this will become a key contact point for your customers, and it will allow you to get feedback on your business.

Hire a temp. You probably have better things to do than spend all day entering data for every item you intend to sell online. As you start assembling your site in earnest, hire someone else to help with the setup work.
Sources to turn to for easy solutions

Numerous Internet service providers (ISPs) offer e-commerce solutions that require little work on your part. Some of the most basic handle your Web hosting needs and provide standardized storefront templates. Many are capable of growing with your business, offering additional services and customizable options should you need them down the road. These companies can provide basic design templates and technology to process transactions, too.

Telecommunications company SBC offers an assortment of off-the-shelf set-up packages for individual merchants. Some key components to look for in such packages are shopping-cart software (allowing your customers to drop in items as they go through your site) and assistance with Web design. This last part is extremely important, as deciding how customers will flow your site is the same as directing them to merchandise. You have to get this part right.

You may have to go through your bank or through services like Verisign to set up a secure system to accept online payment for orders. For smaller operations, you can also explore services like PayPal, which make it easy to accept customer payments with an easily downloadable software package.
Think about affiliating with another site

Is it better to go it alone or join an existing online community? If you really need to differentiate your product or brand, particularly through site design, you may be better off building your own site. But if your needs are more basic and you want to keep costs down, it's probably to your benefit to pitch your tent in an existing online marketplace, which can provide more traffic than if you just open a shop and wait for customers to blow by. Sites like Ebay, Yahoo, and Amazon offer prepackaged storefront services with variety of options for individual merchants, often including free registration of your domain name.

Ebay offers your customers the chance to bid on items or buy them outright at a set price. The Ebay package also includes flexible listing options, limited customization tools, monthly sales reports, inventory search options, and the ability to cross-promote other items with ones you are selling. A mid-level Ebay store costs $49.95 per month, but options rage from $9.95 a month for a bare-bones storefront to $499.95 for a full-service store complete with marketing support.

Yahoo offers three basic levels of service, ranging from $39.95 a month to $299.95 a month, plus a $50 setup fee (sometimes the setup fee is waived during promotions) and transaction fees that range from 0.75 percent to 1.5 percent. It, too, offers a selection of services as well as simple step-by-step methods for listing your products online and software for accepting payment.

Depending on what kind of products you're selling, Amazon also offers several online options for third-party sellers. Amazon's Marketplace program charges a 15 percent commission, on top of a $39.99 monthly subscription cost (or $0.99 per item if you prefer), but leaves shipping and customer service to you. As another alternative, you can partner with Amazon and sell its goods on your own site for a commission.
The bottom line: Always focus on the benefits to your business

Be sure to keep your customers and your business goals in mind as you set up your site. Getting online is the easy part. Creating an online presence that adds value to your core business is what really matters.
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How the Offer of 'Free Shipping' Affects On-line Shopping

The phrase "free shipping" is like a siren song to many who shop on the Internet.

For whatever reason, a free shipping offer that saves a customer $6.99 is more appealing to many than a discount that cuts the purchase price by $10, says Wharton marketing professor David Bell. Bell noticed this phenomenon a few years ago while doing research for an online grocery store, and the observation prompted him to look more closely at the ways Internet retailers use shipping charges -- or the lack thereof -- as a promotional tool.


The result is a model that can help managers set shipping fees in ways that both appeal to customers and drive them to buy in quantities that can be efficiently processed. "There is no direct analog to this in the traditional retail world," Bell says. "It seemed to us that firms had not figured out the 'right' shipping policy, so there's a lot of experimentation going on without clear guidelines."
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Internet-based shopping is the fastest growing sector of retailing in the U.S., Bell says, with sales exceeding $110 billion during 2004. Approximately 60% of online retailers cite "free shipping with conditions" as their most successful marketing tool.

Consumers like free shipping offers, perhaps because it makes the online retail transaction more comparable with that at the neighborhood store. Whatever the reason, it's clear that consumer behavior changes when shipping fees are imposed. With fees, shoppers will make fewer shopping trips and purchase more goods at a time -- not unlike shoppers who drive great distances to a particular store, Bell says, and decide they had better stock up while they're there. Alternately, fees can prompt consumers to simply walk away. A survey from 2004 found that shipping and handling costs triggered 52% of the abandonment of online shopping carts, Bell says.

While some might argue that shipping fees are merely a substitute for the time and travel costs involved with visiting a bricks-and-mortar retailer, consumers may not buy that argument, Bell notes, adding that the link might not be so clear in the minds of many because travel costs are not collected at the traditional retailer's point of sale.
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Some companies have struck a middle ground by waving shipping costs when customers exceed a threshold -- a strategy that can indeed make customers think differently about price, Bell says. Whereas higher prices always are bad for consumers in traditional retailing, customers of online retailers can benefit from higher prices because they push the total closer to the free shipping threshold.

Setting Thresholds -- and Prices

In a recent paper titled, "Free Shipping and Repeat Buying on the Internet: Theory and Evidence," Bell and two colleagues -- Skander Essegaier, a professor at Koc University in Istanbul, and Yinghui Yang, a professor at the University of California at Davis -- developed a model that shows how firms can use this dynamic to their advantage, while not putting customers at a disadvantage.

Bell gives an example of a firm that lowers its free-shipping threshold to induce customers to purchase smaller quantities with greater frequency. If the company's goal is to leave consumers equally well off in terms of their long run costs, should the threshold change be accompanied by price increases or decreases? Bell's model shows that the answer depends on where the firm's prices currently stand.

A firm with already low prices, relative to the model, should drop prices further when lowering the threshold. A failure to do so would give consumers a benefit at the firm's expense, Bell said, because consumers would hit the free shipping threshold more often. Conversely, a firm with high prices should increase them further when lowering the free shipping threshold, since the company is likely to be paying shipping costs more often. "In the latter case, people pay more for the products, but they will more often get free shipping. In the other case, they will pay less for the products, but more for shipping," Bell says. "So, the total cost of products and shipping cost will net out to be the same in both cases. ... Ultimately, the rational consumer is indifferent."

If consumers are indifferent, why should managers care? Because a firm might be able to more efficiently deliver the same quantity of products to a customer in, for example, four purchases over a period of time than the same quantity all at once or in eight smaller purchases.

Bell cites the example of Net Grocer, an online grocery firm that calculates shipping costs based on the size and location of particular orders. The company uses shipping fees to push consumers away from ordering either tiny or massive quantities of goods, both of which can be more costly for the company to fill. Companies that want to fill relatively few orders will raise their free shipping threshold; firms that want customers to visit regularly -- perhaps so they can sell ads on their site -- might prefer low shipping thresholds.

Bell points out that Amazon.com has experimented with free shipping thresholds since 2002. Initially, Amazon offered consumers free shipping if they spent $99, and then lowered the bar twice during 2002 -- first to $49, then to $25. Data from comScore, a firm that tracks Internet browsing and purchasing behavior for academic research, documented the impact of the changes. When a $49 purchase triggered free shipping, the average purchase quantity of products per order was 3.31. When the threshold fell to $25, the average purchase quantity dropped to 2.53. The comScore data included 45 purchasers who bought from Amazon.com when both thresholds were in place. Those consumers spent $17 less per "free-shipping" order under the lower threshold, and purchased 1.82 fewer items.

In addition, the Amazon case shows that lower thresholds for free shipping also lead to greater variation in prices for the same goods. It makes sense, Bell says, because as free shipping thresholds drop, consumers have less reason to make purchasing decisions on price alone. A similar dynamic explains why there is less price dispersion -- a smaller gap between the minimum and maximum price at a specific point in time -- for pharmaceutical products used chronically, rather than episodically. In an extreme world where price information about a particular good can be obtained from many sellers at zero cost, there should be no price dispersion. This is because there is no effort or search cost for consumers that make it possible for different sellers to charge different prices for the same item. In the pharmaceutical example, users should be more willing to shop around for drugs that are used repeatedly for longer periods. "The more incentive there is to search on price, the less dispersion there should be," he says.

As Internet retailing grows, there likely will be more opportunities for research on trends in free shipping. Bell's model, for example, is based on consumption patterns in which the purchaser shops, stores the inventory and then replenishes once the inventory is depleted. So, while the model works for describing how people buy groceries or even books, it's not applicable to durable goods, such as household appliances, automobiles, or other large ticket, infrequently purchased items. Even in the world of non-durable goods, there's room for more research as companies innovate.

Amazon.com, for example, now offers what Bell calls an "all you can eat" express shipping option, called Amazon Prime, for an annual fee of $79. "While we do not consider this variation explicitly, our research is a first attempt at an analytical framework for understanding the effect of such policies," Bell and colleagues write. "Future work might also consider different classes of shipping service defined by delivery speed."
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How to Use YouTube and Other Video Sites to Promote Your Business

Many business-owners might not see a place for “videos” in their marketing budget. But at a time when viral marketing is helping little-known companies gain recognition around the world, these videos may be just what you need to attract more attention to your site.

his doesn’t mean that simply putting a video on YouTube is going to increase your traffic or sales. But a carefully planned series of videos can have a huge impact on your business in a number of ways. And since posting videos on these sites is usually free, there are no costs beyond the time and effort that you put into making the videos.

The key is to provide content that’s relevant, entertaining and useful to your potential customers. Here are some ideas to help you get started.

Make it informational. Beyond just entertainment, Internet-users are looking for information. If you can provide people with valuable advice or tips, then you just might turn those Internet-users into paying customers. Create a short video that’s related to the products or services you already provide. For example, if you run a retail clothing site, try creating videos that offer fashion tips or highlights of the latest trends in the industry. Viewers will appreciate the information and continue to rely on you as a reputable source that helps fill their needs.

Get creative. Chances are there are already several videos online that are similar to what you want to create. So, be original! Get your creative juices flowing. If you can’t come up with any new ideas, put a new spin on an old one. In order for your videos to gain attention, they’ll need to stand out

Don’t stop after just one video. The key to getting your business noticed on YouTube is to make as many videos as possible. Unless you’ve created the most original video anyone has ever seen, most viewers will forget about it instantly. Making multiple videos will give your viewers the opportunity to continue watching your content after each video is finished. A series of videos will keep them entertained and informed and will boost awareness of your business in the process.

Mention your business – but don’t beat it over their heads. While it is certainly important to include your business name (or a call-to-action) in your videos, you don’t need to make it a blatant advertisement. Instead, try putting your logo at the end of the video, or in the corner. Be sure to include a link to your website. And remember, it doesn’t need to scream “buy now!” All you need is to remind your customers who’s providing the content.

Place videos directly on your website. At the end of each video that you place on YouTube or other sites, let viewers know that they can see more videos on your site. Even if those other videos are already posted elsewhere, it’s better if they are viewed directly on your site, since it increases the chance that the viewers will click around to your other pages.

Keep it short. Internet-users don’t want to watch a whole movie about your business. Keep each clip between 1-3 minutes. If you find that you need more time to squeeze into a video, simply cut it up into parts. The key is to engage viewers just long enough to keep them entertained, informed and aware of your business before they lose interest.

Incorporate the elements of the videos into your other promotions. It might seem strange to say “as seen on YouTube” on your homepage, but the more people you can direct to your videos (even your regular customers), the more attention your website will get overall. And the more attention your site gets, the more your sales will continue to grow because of those videos.
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Learn How Can Free Shipping Online Business Increase Sales

Every year, news reports include pictures of the long lines that form at stores on the day after Thanksgiving (Black Friday). Often those same new outlets mention the many clicks that were made on far more than one computer mouse just four days later (on Cyber Monday). Those two big shopping days have obtained widespread recognition.
Now online merchants would like to make Free Shipping Day at least as popular as both Black Friday and Cyber Monday. What is “Free Shipping Day”? It is a day chosen by online merchants, a day close to Christmas. In 2008, “Free Shipping Day” fell on December 18th.

The online merchants who elect to participate in Free Shipping Day agree to free customers from shipping charges, if they order one or more items on that particular Day. Because Free Shipping Day falls close to Christmas, the participating merchants also promise to deliver by Christmas Day any item that has been ordered on Free Shipping Day.

Online merchants want to underscore the fact that access to the Internet can ease concerns about last minute Christmas shopping.. With that aim in mind, those merchants have promised to reward online shoppers who wait until the last minute before doing their Christmas shopping.

Merchants who decide to take part in the scheduled Free Shipping Day do not hide that participation. Instead, wise merchants plaster their web pages with lots of reminders about the benefits available to customers who order items on the Free Shipping Day. The wisest merchants also have their online business listed on a new website—a website that focuses on the ways online shoppers can get free shipping.

That website, www.freeshipping.org, arose in response to the demand for free shipping. Online merchants have come to appreciate the degree to which the mention of “free shipping” can tempt a shopper to visit a particular web page. Offers of free shipping have demonstrated as much drawing power among potential online shoppers as the traditional sales ad (from a brick and mortar store).

Because merchants would like to enjoy the benefits of free shipping on more than just one day, online merchants have explored different ways by which to relieve their customers of expected shipping charges. A visit to the website www.freeshipping.org acquaints online shoppers with the resources for finding merchants, merchants that offer free shipping.

Some merchants, for example, have chosen to offer free shipping coupons. Other merchants have chosen instead to make a free shipping code available to reliable and steady customers. At freeshipping.org, an online shopper can find details on merchants that have used either free shipping coupons or a free shipping code, in order to entice visitors to their online store front.

Another avenue by which online merchants can use the benefits of free shipping to an advantage involves use of shipping discounts. Stores that have customers who like to purchase in bulk often reward the customers who adhere to that particular buying trend. Those online stores promise discounted shipping to customers who have placed a bulk order on some item.

When a customer buys an item in bulk, that customer must obviously pay a sizable amount for that order. The online merchant can reward that customer by offering a discounted shipping charge. Some online merchants have elected to use a different type of reward system. They have promised free shipping on orders that fall above a certain amount, typically $75 to$100.

Free shipping gives the online merchant an added way to promote particular items. Years ago, when a store wanted customers to buy a certain item, it would display that item in an eye-catching way. That display would draw the attention of the customers. Today, the offers of free shipping draw the attention on online shoppers.

If an online merchant has an item that he or she wants to sell quickly, that merchant can advertise free shipping on any orders that include that same item. In cases where a merchant hopes to clear out all of goods with a certain brand name, then that merchant, too, can make use of free shipping offers. That merchant posts online the promise of free shipping, any time that the brand of concern has been included in a given order.

Sometimes, an online merchant has been approached by a credit card company. That company might have agreed to reward the merchant, if he or she could invite more online shoppers to use a particular charge card at a certain virtual storefront. In that case, the merchant would want to consider making free shipping available to customers who charged for their purchase with a particular type of charge card.

Finally, the online merchant, like merchants every where, always welcomes returning customers. Offers of free shipping can provide online merchants with assurance that at least some of their customers will return again to the web page on which they previously discovered an appealing item. An online merchant can advertise free shipping to returning customers.

As more merchants discover how to take advantage of free shipping offers, customers can expect to see an expanded use of that powerful marketing tool. Perhaps, astute online marketers will design even more ways by which offers of free shipping can be used to lure shoppers to a certain virtual storefront.

Online merchants will no doubt compete for customers who want free shipping, in the same way that store owners now compete for shoppers who are in search of a bargain
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