cigar marketing Archives by Mark Murnahan

Business Evolution and Crash Test Dummies

Take just a moment and reflect on how your job evolved. Whether you are a business owner, manager, or just working your way up the totem pole, look at your career in a snapshot. It is uncommon for a career to move smoothly along its initial planned path, from start to finish. A business entity is no different in this respect.

Companies change a lot over time, and if the business evolution is just right, people are happy. The world is perfect, and you can look out your window to see pink unicorns kissing adorable puppies on the forehead. Business evolution should always be so perfect, but then the human resources department would have the additional job of giving out hugs instead of layoff notices; accounts payable would cheerfully add a bonus for the utility company; and the accounts receivable department would send chocolates with every delinquency notice.

Since career and business are usually not perfect, many disheartened people will give up managing the evolution of their company and the direction of its travel. They end up going for a ride like a crash test dummy waiting for the impact.

Hop in and Ride With Me

I am a huge fan of analogies, and I also love cars and driving, so I am inserting my loves here. Hop in and let me take you for a drive through the typical evolution of a business as it navigates between “point A” and “point B”. Don’t worry, I am a trained driver.

I hear from a lot of businesses struggling to define the path between where they are and where they hope to be. I gather a lot of observations as I listen to these companies, and I uncover many commonalities between them. This helps me to build better strategies. Most of the people I talk with feel like they landed themselves in an industry and with a job title that was at least a few miles away from where they began, or where they expected. This goes for people in every level of a business, from the very bottom to the very top.

It all seems to “woosh” by in such a rush for a lot of business people. Whether you own your company or not, whomever it is who signs your paycheck has probably experienced that same “woosh” effect. So, let’s examine some factors which significantly put on the brakes during the evolution of a business.

In this business evolution, I want you to think about where you find yourself today. I suspect you will find yourself cruising somewhere on this road, either as a driver, navigator, or passenger. Many businesses begin as somebody who found a passion for something, or a perfectly timed opportunity, and grew an idea from a spark into an ember, and eventually into a flame. Now we have the combustion engine … an engine to help move us down the road to where we want to go.

Will the Driver Keep Their Head on the Crash Course?

Fatigued Business Drivers Fall Asleep at the Wheel

Along the road, a business founder usually ends up doing a lot of driving. A small company, and most are small at first, will often begin with somebody acting as the sales, billing, accounts payable, reception, public relations, marketing, and “something else” person. The “something else” is the part that the business is about, whatever it may be … accountant, electrician, car dealer, home builder, surgical supply company, real estate brokerage, cigar shop, or whatever it is. The “something else” is that cargo in the back that we are driving to deliver.

At the start, the company is fueled based on the skills, passion, opportunity, and funding of that same “something else” person at the wheel, and not based on all those many tedious jobs to fill. As the business gains a little momentum from all of that exhaustive work given by a person or small group of people, many of those jobs are delegated properly to others who are fit for the position. They each get their seat in the vehicle that moves the business.

If all goes well, navigators will be reading the road signs and updating the business plan, the business budget, the marketing strategy, and keeping the business driving in a good direction of growth. Much of the navigation lands in the driver’s seat with a tireless owner or manager who has great navigation and driving skills. They drink a lot of coffee to remain alert, and they seldom take their eyes off the road.

I know that it must seem almost impossible, but what happens if their vision gets blurred? What if they get a bit too distracted, or just too familiar with their day to day commute and they relax at the wheel? I’ll tell you what happens, because I am frequently like the dismayed highway patrol officer who arrives on the scene when the vehicle is already out of control. Of course, nobody appreciates me for writing them a citation, but they expect me to be very compassionate when I pull their kids out of the wreckage.

The initial passion, funding, and opportunity of the drivers with the “something else” is usually not enough to safely navigate the business through the winding road and beyond the inherent roadblocks. Even with their eyes fixed on the road, if they let go of the wheel for a split second, the whole trip becomes a big wreck. Many businesses crash with no more than a driver and a passenger or two, but if they made it beyond the earliest road blocks, they may have a bus full of dead crash test dummies.

Fear of the crash is why most people will never own or manage a company.

Killing the Crash Test Dummies

Screeeeeeeech! Slam on the brakes! The business is all of the sudden sliding out of control, and going in unpredictable directions.

The business plan, which was once the road map, is frequently forgotten while the company is still driving down the same road and on the same mission as it was yesteryear. Somebody forgot to budget, so the bills are just being paid as they come in the mail. Marketing strategy? Well, the marketing strategy is to sell as much of this “something else” stuff as possible to put enough money in the bank to cover all of those checks that keep going out.

Many drivers will loosen their seatbelt, ignore the squeaking brakes, and let the fuel gauge needle dip a little too close to the “E” before checking the map for a gas station. They forget to take good advice from employees and other influencers, and begin to treat them like crash test dummies, instead of as the great assets they represent.

It sounds like a pretty nervous way to do business, right? Would you be totally shocked if you found similarities to this in your company? If you are nervously looking in your mirrors like a single occupant in the carpool lane, or grabbing your safety belt like a bus driver with bad brakes, you are not alone. Many companies of all sizes operate this way, and they overlook important steps to better business evolution. Careless driving is one of the biggest killers among businesses.

The most common factor is that the people with that special “something else” let the map fly right out the window. This happens periodically throughout the lifespan of nearly any company. In fact, it may surprise you to ask other business people around you when the last time they thoroughly reviewed and updated their business plan, their budget, or their marketing strategy. This may not apply to Fortune 500 companies, but they often don’t have it just right, either.

Arriving at the Crash Scene

How this came to me today was in a very common exchange with a company manager trying to navigate for his company. He wants his company owner / driver to stop at a gas station to get some racing fuel, instead of just driving along with a dirty windshield. The driver has not crashed in ages, but that is never a good excuse to let the insurance lapse, or to stop using a seatbelt. It not only goes against the laws of business, it can cause a mess for all of the passengers (employees) and bystanders (customers).

The managing navigator flagged me down as the highway patrol because he wants to report his boss for careless driving. In this case, the owner opened the business with that same passion and timely opportunity as others. He has been lucky to navigate well without a map, and with bald tires for years. Since the time he settled into his driver’s seat, his risk of a crash is increased exponentially. His windshield is dirty, his road is filled with potholes, and the other drivers are speeding by him and pointing at his seatbelt dragging on the ground outside his door. Worse yet, he fails to let his backup driver take the wheel when his eyes feel tired.

I am here to check the driver’s license and insurance of this owner / driver, or otherwise to help his top navigator to get in his own car and drive away. The manager is so dismayed by the owner that he is hesitant to continue presenting good ideas. The owner is so accustomed to just going along for the unplanned ride that the manager feels like he is in a crash test, too. It has forced him to decide whether to buy into the company, or to start his own.

Running a business well means maintaining the vehicle, keeping the drivers and navigators on the right road, and so many other things. The hazardous but common truth is that many business drivers will take better care of their car than their business plan, budget, and marketing direction. Instead, they have just stumbled upon a road by chance and circumstance and driven the best they know how with the vehicle they landed in.

Most business people are not good at every aspect of running a company. Even fewer of them properly address the value of efficiently delegating tasks to professionals, especially with marketing strategy. They mostly just know the things they picked up along the road during the journey with their unique “something else” that their business is about.

If you know somebody like this, pass this along as a reminder that other “dummies” are counting on them for a good trip. I am not telling you the perfect navigation for every journey on the highway. I just want to remind other drivers to look up from the steering wheel enough to read the road signs.

What do I have to do with this? My job is to isolate the squeaky parts, find the right mechanics, train the driver, buckle in the passengers, supply the road map, change the tires, and pour racing fuel in the tank. I guess you could call me the marketing crew chief.

I will leave you with this compelling crash test video. Give it a play and consider your driving safety while you prepare your comment to tell me what you think.

Photo Credits:
IIHS Crash Test Dummy via Wikipedia
Dummy Heads by Greg Westfall via Flickr
Dummies in a Cage by Brad K via Flickr
Ford Crash Test by Rian Castillo via Flickr
Sierra Sam (hanging dummy) via Wikipedia

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Cigar Prices Rising With Bad SEO and Social Media Marketing

Cigar prices are rising because of social media marketing and seo? I must be joking, right? No, not at all, my friends. Cigars are just one of many categories of consumer products suffering higher prices and lowered standards due to inefficient use of marketing resources. I am using cigars as an extreme example, but you can see it in many industries beyond cigars, too. While you read this, consider how it may fit into your industry as well. You may wonder how in the logic of Murnahan poor marketing decisions can make prices rise, but I will explain.

Online Cigar Stores Are Inefficient

I received a call from an online cigar store owner yesterday after he came to my website while searching for a cigar-related term. It may seem strange, because I am not in the cigar business. I am a marketing guy who just happens to like cigars. It is crazy that I have more people coming to my website searching for cigars than a lot of the companies who actually sell cigars. Then again, I get a lot of car dealers and surgical supply companies here, too.

I liked this guy who called me, and we had a great chat. We talked about his industry challenges, and how it seems that one of the biggest of them is that all the online cigar stores are battling for the best cigar prices. They fight with the cigar makers for the best prices, and then they fight to gain customers with low prices. After all, that is how you sell stuff, right? If you give them free shipping, a free cigar cutter, and lower your prices to the point all the profit is gone, it should be good for business. It seems that as an industry, online cigar stores have this impression that if they slash prices it will make them more appealing and somehow by the grace of cigar smokers it will help more people find them. They will magically find them and buy cheap cigars that leave little or no profit for the cigar store owner. I see this in a lot of different fields, where people make the mistake of giving away all their profit by trying to compete in a price battle rather than using marketing strategy to win the value war.

Oh, but wait! Don’t businesses need profit? This price battle starts to seem like a bad idea once all the profit is gone and competitors keep dropping prices, doesn’t it? After all, unless you actually have the capability to be the biggest cigar company online, you had better start figuring out how to be the best cigar company online first. Wouldn’t it make more sense to try and keep the customer churn rate low and provide better value? Doesn’t social media help to do that by building brand awareness and brand value? Oh yes, it does, but sometimes values like that can elude an entire industry … that is, until somebody steps up and pulls the rug from under them.

Online Cigar Stores Place Price Over Value

Many cigar stores will have a big inventory of cigars that sat on a shelf in a warehouse for a long time, so they offer them at a huge discount. They run a big special on that brand. They are not so concerned with quality as much as they are concerned with moving the product. This happens in many industries, such as consumer electronics, automobiles, real estate, food, clothing, and many more. Moving more product often comes with an urgency. Get it out the door so you can buy more inventory … whatever it takes. So what happens is while the frantic overstocked cigar store is playing this game of catch-up, somebody is selling the new inventory of cigars that actually yield a profit. They often tend to forget that there is also somebody out there who is making a profit. They may even be selling more of the same thing, but selling it for more money because they have proven value, and because more people know and trust their brand.

The reactive seller is an industry follower and not a leader. They are doing business as a reaction instead of a cause. They have not done what it takes to build brand-loyalty, and to develop stable and sustainable marketing numbers. They keep making the mistakes, but they do not learn from them. What they do learn from the mistakes are the wrong lessons, based on the wrong sets of numbers. They watch what everybody else is doing and try to emulate it instead of innovating. They dig their own grave this way, and often call a guy like me once the only question left is “can I afford this?” They end up with such terrible results of chasing their tail that when they actually realize a problem, they are too late to implement a solution. They are not proactive. When they are equipped to make good decisions that will sell more cigars, they do not see a need, and when they see a need, they are no longer equipped.

Online Cigar Stores Know Cigars, Not Marketing

In every business, there is a need for marketing. Better, smarter, faster, more effective marketing is what makes companies successful. Marketing is what puts their products into consumers’ hands. It is what sells cigars, and everything else … even which emergency room people go to when they are hurt or sick. Without a proper market reach, companies fail. The best market reach for companies is online. It is where people are, and you can reach them a whole lot better here than you can with a 30 second television spot; a newspaper advertisement; a Yellow Pages telephone book clip; and whether you like it or not, better than you can reach them with word of mouth alone.

Marketing on the Internet is not based on luck. You do not just put a website out there and hope for the best. Hoping people will find you and buy from your online cigar store is like hoping it will rain Nub cigars. I hope it will rain Nub cigars, too, but I am not going to my bank to deposit them just yet. The fact is that in order to create more business, it requires marketing talent, marketing creativity, and a lot of work.

I should add that the gentleman who telephoned me yesterday found me because of an article I wrote on February 2, 2009 titled “Nub Cigars by Oliva Cigar Company Fall Short” and it discussed the shortcomings of cigar marketing. It has created a lot of traffic to my blog and a few phone calls as a result of cigar related terms such as the list below and this extended list of the top 200 cigar search terms that people used to find my one little blog post. Note that only two of these searches included the words “cheap”, “cost”, or “price”.

It is a sad but funny fact that the biggest concern the caller had is how much it will cost to get the results he wants. At the same time, he did not really even know what results he wanted, or what potential he has. He just knows that he wants to sell more cigars online, and he wants to achieve his unestablished goals cheaper than anybody else. The better questions are in the cost of not doing what it takes to create more business. How many more cigars can you sell if more people know your cigar store exists and have a reason to buy from you instead of the other guys? How much is it worth to have more people coming to you instead of somebody else when they search for things like these:

nub cigars
short cigars
nub cigars for sale
best short cigars
nubs cigars
nub cigars online
oliva nub cigars
buy nub cigars
cigars nub
company produces cigars
difference between nub cigars
marketing cigars
oliva cigars nub
where to buy nub cigars
who makes nub cigars
nub cigars retailer
“short cigars”
#cigars
a website with guys and cigars?
best 4 short cigars”
cheap nub cigars
cigars
cigars “social media consultant”
… more cigar search terms

In the case of my caller, he wanted me to create a plan for him and get back to him with some figures. I know he may not understand this, but without a target, I don’t even load my gun. I need to know what I am aiming at before I just start shooting out proposals. What I sell is not an item on a shelf, but rather the smoke that comes from my brain … not my cigar.

How Does SEO and Social Media Affect Cigar Prices?

There are actually two ways that cigar prices are affected by social media and SEO. First, let us consider what happens when a company is inefficient. They could sell more cigars if they used their marketing dollars more productively. Being productive means doing things that create more sales, generate more profit, and lower their cost with the cigar manufacturer. The second way that cigar prices go up due to social media and SEO is that a cigar store that markets their brand well and generates a loyal customer base can stop fighting price battles and start winning at providing the value that customers are actually asking for. Most of the time when people say they want “cheap cigars”, what they really want is to get their money’s worth … whatever the cost.

I only plan to do business with one online cigar store, and it will not be “cheap”. I don’t offer cheap marketing, because I know the difference of Marketing Cost vs. Marketing Value. As it is, I may have to say “no” to a good number more of them before a light bulb goes on for one of them and they decide to be the next cigar tycoon.