Online Sales vs Phone Sales

Tomorrow, World Vital Records will begin building its call center under our new manager Scott Spencer. He worked at MyFamily.com (now The Generations Network) from 2003-2006.

We are planning to hire 10-15 people in the next few weeks (part time and full time) to do genealogy sales, support and coaching. (If you know someone who might be interested, please use the Contact Me form on my blog, and let me know about them.)

Scott will be recruiting, hiring, and training individuals who can successfully sell our products (and our partners products as well), but also who understand the unique characteristics of the genealogy market, and who won’t use high pressure tactics that have no place in this business. In fact, we are anxious to hire call center employees who love genealogy and love helping others. Scott has worked previously with a number of very skilled genealogists who worked at the TGN Call Center, before TGN cut its call center staff dramatically and focused on trying to have as many sales and renewals as possible be handled online.

Until now, nearly all of our revenue has come from online marketing. Our World Vital Records Quantcast chart shows how our traffic has grown dramatically this year. Our sales are growing, but we are planning to more than double our current sales volume by the end of the year, and while online marketing will provide a lot of that growth, we think our call center will add a great deal to our capabilities.

I wonder what percentage of other internet companies sales come from their call centers? I love the Internet Retailer Top 500 annual report, one of the best reports in the industry, but I don’t think they have any way to track phone sales. But surely someone has compiled such a report. (If you know of one, please comment.)

Business analysts talk about “high tech vs high touch.” Online transactions are high tech. But some industries and some types of customers need “high touch” more than others, meaning that they need great customer service and support–a human element. Many B2B companies can build global supply chain management software that pretty much automates all their interactions with their suppliers and customers. This can dramatically increase profitability, as many of the unnecessary human labor costs are squeezed out of the business.

But family history is a hobby that engages millions of people that often need a real person to guide them in their research and to encourage them in their sometimes difficult quest. Most genealogists tend to be older and some are tentative about technology. Just attend your local genealogy society meeting and you’ll know what I mean.

I have a friend in his 40s who attended a genealogy society meeting back east a few years ago, and he reported to me that he was the youngest person there. That didn’t surprise me, but then he told me that his father was the second youngest person there!

In a recent month, 16% of our sales came from checks that were mailed in to our company. How many online businesses do you know that have customers writing checks and sending them in? Is this because family history customers are wary of online transactions, or is it because they’ve been using checks to pay bills and buy things for 50 years, and old habits are hard to break? Probably a combination.

But for customers who are used to asking questions, getting phone support, and talking to a real person when making a purchase, we are excited to build a customer friendly call center and to interact with hundreds of genealogists, societies, and libraries every day.

In addition to increasing our sales, and improving our customer satisfaction, we will use our call center to develop a great deal of “customer intelligence”–a knowledge of what our customers want.

Many companies fail to understand their customers.

Just this week I had two terrible experiences with credit card companies who have an automated phone system that makes it virtually impossible to reach a human. I had cancelled a card back in February, and I’m still getting billed for it, and I can’t pay my bill online because I had cancelled the card (and they disabled online payments) but they keep putting in finance charges, even after I paid the entire balance by phone last month (and had to pay $14.95 for paying by phone). It’s like I can’t pay the balance down completely without having either a payment fee show up on my bill the next month or a small interest fee show up. I feel like I’m stuck in Hotel California, “you can cancel any time you like, but you can never leave.” Finally I reached a human, and he said I had to call back the next day because he couldn’t tell what my late fee would be until tomorrow when the computer calculated it for him. Arrrrrgh!

I remember the day when my brother Curt asked the 12 or so VPs at MyFamily.com (back when he was CEO in about 1999) how many of them had spoken to a customer in the last 30 days. No one raised their hand.

From that point on, I made it a practice to have phone calls with customers regularly. When I became VP of Marketing in 2001, I required my team to go to the call center weekly for several hours and participate in customer phone calls. It made all the difference in the world for our marketing team to actually listen to customers firsthand, and to know what questions they were asking, what they loved about our products and services, and what they hoped we would improve.

I helped start a company in 2005 that had a great online offering, selling mp3 related supplies and content, but had no first hand interaction with customers. I really tried to convince the CEO to set up a mall kiosk where we could interact with dozens of customers every day, and find out what they wanted in person. It didn’t happen. The company focused only on online sales and marketing, because retail was “too expensive.” Without qualitative feedback from actual customers, without knowing the reasons why they were making a purchase or why they would not make a purchase, I think the company lost touch with its customers and went on to make some strategic product and marketing mistakes that would have been prevented had we been highly involved with our customers.

Scott Spencer is going to help World Vital Records make sure that we are highly involved with our customers and highly responsive to their needs.

Scott is a strong leader who brings with him experience in call center operations along with a great passion for genealogy. His background consists of managing inbound/outbound sales and support teams to overseeing the quality assurance department at The Generations Network (formally MyFamily.com). Before joining TGN in 2003, Scott worked as an outbound sales supervisor on the American Express account at Convergys Corp. where he assisted in the development and success of key programs.

He later joined the supervisor ranks at TGN’s Member Services department where he managed the inbound sales and support department for Genealogy.com, which TGN acquired in 2003. He went on to manage the Quality Assurance team where he played a vital role in supporting the company’s vision, while gathering valuable member feedback essential to providing a world class customer experience.

Scott again joined forces with the operations team in 2006 as the Assistant Manager of Inbound Support. Scott worked hand in hand in supporting the inbound operation which consisted of customer retention, sales, welcome call, and technical support teams. During his tenure at TGN, Scott spearheaded many key projects that impacted the growth and success of TGN’s Member Services.

When not working, he enjoys spending time with friends and family, as well as fly fishing the beautiful waters of Utah.

Internet companies and merchant account limits

If you run an internet business with the potential for rapid growth, and you use a merchant account for processing credit card transactions, please check your merchant account monthly limit before you encounter the problem that we experienced over the weekend.

Wikipedia has a decent article on Merchant Accounts, but until I edited it today it said nothing about monthly transaction limits.

The merchant account limit bit one of our Provo Labs companies this weekend. Here’s what happened:

WorldVitalRecords.com started selling subscriptions to its web site on October 4th. We had some initial subscribers from blogs and news releases, but we didn’t turn on our online marketing efforts until last Friday. Our first email campaign went out to 80,000 genealogists. We invited them to get 2 years access to our databases and online courses for the price of 1 year. Our expiration date on this offer is today, October 31st. (MarketingExperiments.com has demonstrated how important it is to have special offers that include urgency.)

The email campaign brought us a large number of new subscribers. Our team had a contest to see who could guess how many subscribers we would get in the first 24 hours. I won the contest–my guess was within 4 of the actual number.

The large numbers of signups continued into Saturday, but then came to an almost complete stop. On Sunday, our numbers were tiny.

Upon investigation yesterday, our team discovered, much to our dismay, that we had reached our monthly transaction limit on our merchant account. Between Saturday and Sunday 113 credit cards were declined, costing us more than $5,000 in revenue.

Yesterday, when our bank helped us get the limit increased temporarily, we saw the subscription numbers soar once again. Hopefully, we can recover the lost revenue from the denied cards. But more importantly, we hope to get an increase to our limit so we won’t have this problem again.

I remember many internet companies had problems with merchant account limits years ago. A 2002 story about profitable internet companies in Southern California describes the trouble that one internet startup had with their merchant account:

The toughest part, they agree, was establishing credit as a totally Internet business. The first weekend they received $10,000 in orders. “Our merchant account (for payments by credit card) would take 12 days to clear our money,” Livdahl says. “Suppliers wouldn’t ship because we hadn’t paid. We just had to wait. It was terrible.”

InternetRetailer.com sells a report that lists 500 retail ecommerce companies that had 2005 revenues of more than $3 million. Many of these companies are fast growing. I wonder how many of them have run into the merchant account limit problem at some point in their history? I bet this is a pretty common thing.

Does anyone have insights into this problem or first-hand experiences with it? What can be done to avoid it? (It’s actually a nice problem to have, in comparison with other problems that many startups have, like not having enough customers.)

P.S.

Interesting thing from Google Trends when you look at the cities where people are searching for “merchant account” or “credit card processing.” Apex, NC has far more queries than any other US city. Does anyone know why?

And Pakistan has far more searches on “merchant account” than any other country. Pakistan is listed by MSNBC as one of the top 5 countries involved in credit card fraud.

#1 Need for Startups

In May 2005 Fraser Bullock, one of Utah’s brightest lights in the financial world (formerly with Bain Capital, now runs Sorenson Capital, helped with the 2002 Olympics turn-around), spoke at the Edison Conference in Salt Lake City.

Fortunately, I had my blackberry and I took extensive notes. Here are my notes from the middle part of his talk:

Management has to be adaptable. 1990 someone brought him into run home shopping network, pre-internet. Challenge was to get consumers to buy. They had a patent. Decided they had assets, what could they build that might be of worth. Built transaction processing engine for remote banking. Sold it to Visa International in 1994.

In fast moving tech environment, if I didn’t step back every 3-6 months to fundamentally re-assess our assets and the environment, I might be missing a paradigm shift. You need the discipline to step back.

We invested in a hardware company, but we saw the asset in the software they had developed. We invested in it, but are converting it to a software company.

Ultimately we have to produce revenue. That always comes down to distribution. Our 1990 company did deal with Visa, they distributed to thousands. For new companies, it’s distriution, distribution, distribution. Must be big, fast, easy. We always asked “Where is the money.”

Long term, to succeed, we needed to have a strategic competitive advantage. What makes you different? What will make people buy this? This is essential to any company we look at.

When you are looking at changing behavior (even if your product is twice as good), inertia is your worst enemy. Sometimes you have to be 10 times as good.

Looking at the handheld X-Ray system he said he’d like to use this on teenagers to find out what is going on in his life.

Utah more and more is coming of age. To our chagrin, most of the big tech companies we’ve built here have left. But we are getting more critical mass. And there is more capital now. The overhand is astonishing. If you have good management team and a distribution strategy, the money is out there.

We need companies here, and high paying jobs.

The key takeaway from Fraser Bullock’s talk that I have been thinking about lately is his strong emphasis on distribution as the key to revenue.

Without sales and marketing distribution channels, you cannot get to revenue.

I also have notes from a Greg Warnock UVEF speech last year where he said a recent survey of 400 Utah entrepreneurs showed that the average time to revenue for a startup company is 14 months.

I think that is WAY too long. I think that if entrepreneurs would focus on distribution, they could cut the time to revenue dramatically, and find much greater chances of success.

I have a friend who made the Inc. 500 list in the 1990s, with a couple million dollars per year in annual revenue. He told me once that his revenue was tiny until he found a new distribution channel: home school conventions. Once his company found success with home school conventions, they started going to all of them and the company’s revenues jumped dramatically. If he hadn’t found this channel, no doubt the company would have folded.

So it’s all about the channel.

At Infobases, the first company I founded and ran from 1990-1997, our two primary distribution channels were LDS bookstores that sold our CD ROM products, and then over time, our house mailing list, which eventually grew to nearly 150,000 customers.

There are different channels for different products and services. Each industry is unique. Entrepreneurs need to discover all the various channels and layers of influence that affect how decisions are made.

There are retail channels, network marketing channels, direct marketing, distributors and value-added resellers (VARs).

Since 1996 I have been focused primarily on the internet as a sales and marketing channel. My favorite “internet channel” is affiliate marketing, where thousands of motivated entrepreneurs and webmasters aggressively promote your products to all their site visitors or email list subscribers.

My next favorite channel is search engine marketing, a powerful channel where every keyword you purchase or get high natural rankings for becomes a sales person working for you 24-hours a day.

I don’t know if I’m abusing Fraser Bullock’s definition of a channel by describing the internet as a channel. But I do know that many if not most of the pureplay internet companies from the mid-90s have expanded over the years to become multi-channel retailers.

Except for potential channel conflict, which can damage a company, there is little reason for a company to stay purely within one channel. Companies want to expand, and finding new channels is a great way to grow your business.

But for startup companies, finding the first channel that gets you customers and revenue is the most important thing.

One unusual source that I rely on again and again to discover potential channels for companies that I am involved in is the Directories in Print, published by Gale. I own a 2003 edition. But local university libraries often have the latest edition on the shelves.

Directories in Print is like the yellow pages, which I also sometimes use for brainstorming potential channels and strategic partners. It covers hundreds of categories and topics. And within each topic, it lists industry organizations, associations, published guides, and all kinds of directories of members and companies. It’s a great starting place to get a feel for an industry.

Next, I like to research all the periodicals and publications that cover a particular topic. The Gale Directory of Publications and Broadcast Media lists more than 11,000 periodicals, newspapers, radio, TV and cable stations. The 1994 edition listed more than 50 periodicals in the genealogy industry.

The Standard Periodical Directory lists more than 70,000 titles in 230 subject areas. Oxbridge publishes several titles including the Oxbridge Directory of Newsletters.

I don’t have copies of any of these, but I hope to get copies of many of these reference books for the Provo Labs Academy Library. For now, we’ll just prepare a directory of the most useful ones along with their call numbers in the BYU Library.

I’ve blogged before about the great need for entrepreneurs to write things down. Intellectual capital, even the name and email address of a single person whom you once met, might be the key to your finding the channel that will turn your company into a success.

The Apprentice episode a couple years ago that showed two teams competing to attract brides to a single day wedding gown sale in downtown New York City ended with one team failing miserably and the other team selling dozens of gowns to the crowd of brides-to-be that flocked to the sale. The difference? One team knew about theknot.com‘s bridal registry database; the other team did not.

The team with a channel wins over the team with no channel.

So what is the #1 need for startup companies? Find a channel that helps you find customers and generate sales. Of course as Fraser Bullock also pointed out, you have to have a great product to break into a channel, sometimes 10 times better than the competition that is already entrenched.

But some channels, like the internet, are great for new companies with new products. I encourage entrepreneurs to use sales channels like eBay to see if they can sell their product to the millions of people who shop there before investing thousands of dollars in building their own web site. I also advocate setting up stores on Yahoo and Amazon and not merely relying on your own single storefront. Take your products to where the customers are. Use all the available channels to reach the maximum number of people.

The ebook publishing company that Provo Labs recently invested in has some great online channels, including Handango and Mobipocket, with more coming soon, including a major web retailer.

The Deseret News has become a great partner for the LDS Media products. And mp3books.com is working with FranklinCovey to make its audio books more widely available to its customers.

FundingUniverse.com is using Sprout Marketing to help identify influencers in the angel investing world and also to find potential strategic partners. Strategic partners that bring you into contact with their constituents can also be considered channel partners in a broad sense — don’t just think retail channels.

So if you are a startup, think long and hard about the channels that you are going to use to get your company to profitability. Spend more time on that than you ever have before, and your chances for success will increase.

Why Do Most Companies Fail?

I was asked Tuesday at the Corporate Alliance summit why most companies fail.

My guess is that most companies fail primarily because they don’t have the right team of people. The CEO might not be right, or the CEO hasn’t chosen the right people in the right positions, because most CEOs don’t know the talent level required at each position and the teamwork needed to build a successful company.

This is especially true of young CEOs, who haven’t been around the block, who haven’t seen great talent in action, in all the roles necessary to build a successful company.

The more I think about what CEOs do, the more I seem to think a comparison to a basketball coach is appropriate. To have a successful company, most businesses need key people in several categories including research & development, manufacturing, IT, finance, marketing, sales, and HR. Many CEOs may have personally succeeded in one of these areas. For example, most Inc 500 CEOs say they are personally strong in sales and marketing. I think the number was 80% last time I saw a survey.

But CEOs of struggling companies most likely have strong employees in areas where they know what talent is, but mediocre employees in all the other areas that they’ve never coached before.

If a CEO has never worked for a company with a great finance person, how can they be expected to hire someone that is great? Same with every position in the company.

I have observed that technical CEOs often hire a lot of great technologists. It’s great to have good technologists in a company, but what if you don’t have great sales and marketing people? Or what if you have good traditional marketers, but no great skill in internet marketing? It is hard to succeed today without leveraging the web.

A technical CEO that staffs a company with a bunch of great developers but overlooks PR, marketing, and sales is like a basketball coach that starts five centers. An NBA team that started five centers would get killed by a well-rounded team with skill in every position. A team with all centers would have no point guard to dribble and pass the ball and no shooting guard to put up three pointers. The balanced team would be way too quick for them.

Every team (company) needs a point guard (marketing guru) to do pass the ball (lead generation), a shooting guard (sales force) to score, and of course solid rebounding and defense and teamwork (manufacturing, finance, operations, etc.).

Without sales and marketing roles being filled by very capable people, a company won’t stay in business for long.

But how does a technical or finance CEO hire a truly great sales or marketing person? It seems almost impossible.

It’s like asking me, as a marketing-type CEO, to hire a great computer programmer. How can I do that unless I’ve worked with someone before and know they are great? I can’t look at someone’s code and understand it. I can’t even ask good interview questions if I’m not a programmer myself.

Since a technologist CEO most likely has never done sales and may not know any great sales people, it is very likely that he/she will hire poorly for that position. And same with marketing, and finance, and on and on.

I believe that several things can help CEOs hire great people for every area of their company.

First, build a diverse advisory board of successful people who represent all the different skills sets you need help with. (You might not be able to judge if your chosen advisory board members are really all that great in their fields, but ask around and get references and assemble a team of successful people that probably can tell talent from fluff.) Silent Whistle (now Allegiance) had one of the best advisory boards I’ve ever seen. And I think it made a significant difference in helping the company get great people in key positions like product development, sales and marketing. And now it is really paying off.

Second, do group interviews. We have started doing this at Provo Labs and it makes a big difference. We get multiple candidates for each position and then we conduct group interviews, so that several of us are able to ask questions together. We all hear answers to questions that we might not have thought of asking. This prevents the interviewer from doing all the talking, which has always been one of my biggest problems in interviewing. (I have what Business 2.0 calls “Babbling Interviewer Disease.”) I sell the vision of the company during the whole interview and by the end find myself completely pumped up–”that was a GREAT interview!” (“Wait, I did all the talking.”)

Third, have a mastermind group of successful CEOs with different skills sets who are willing to interview candidates for each other.

I have no idea if this has ever been tried or if it would work, but I just thought of it, so I decided to throw it out. (Besides, you can’t make a list of ideas and end up with only two.)

One thing Provo Labs will do to make sure that our team members all stay great (assuming they were great when we hired them) is that we will ask every one to join (or start) a local networking event for professionals in their exact field.

For example, when we hire an affiliate marketer, we will ask him/her to join a group that I think is called the Utah Affiliate Marketers Network, or something like that. I’ve never attended it, but I know it exists.

Our email marketer will probably need to start a local group where email marketers share best practices. Our SEM marketer may have to do the same. And our content acquisition and business development teams will most likely have to form local groups as well, because I’ve never heard of networking events for these areas.

And our developers will actively participate in Geek dinners, but they may also be asked to form a smaller network of 10-12 people who are really focused on the same kinds of programming, who will meet regularly to share their best ideas with each other.

The other thing we are considering is a bit more radical. We are considering hiring a full time employee in Asia to directly work with/for each full time employee at Provo Labs. This is partly driven by time to market issues and to put time zone differences to work in our favor, and partly because of our desire to be international in both our work force and our understanding of international markets.

I heard a key Procter & Gamble executive last fall talk about how many research teams they have within P&G where three teams exist in various locations around the world, all working on the same project, so that as the US team wraps up their workday here they hand things off to an overseas team, who in turn hand their work off eight hours later to another overseas team in a location eight time zones away. So that you get 24 hours of actually work on every project each day.

If the hand offs go well, you can cut your time to market by 2/3rds.

I like this idea. I like the idea of our employees in the US thinking that if they do good handoffs that their projects will make significant progress while they sleep. I think it will also help them thinking globally in everything they do.

Like I said at the beginning, I believe that most companies fail because they have the wrong people on the bus, like most basketball teams fail not because of game-time coaching, but because of recruiting. It’s hard to win with the wrong people.

If CEOs can find ways to learn what real talent is in every position they need to fill, and if they will learn to help everyone work as a team, then the team they build will lead the company to success.

Investors almost always say they invest in the team more than in the idea. (There are a couple exceptions among VCs.)

So if that is true, all of us who start companies better focus most of our energy on building the right team.

MyFamily Acquires Heritage Makers

MyFamily.com has acquired Heritage Makers
a company with 1,200 distributors who help families print heritage
books. I remember meeting the company founder years ago when it was
called My Family Tales. [Here's an old article about My Family Tales.] I even have some of their early products.

Chris Lee, one of my favorite people from the early days of
MyFamily.com, is now the GM of this business unit. It will be exciting
to how fast this division will grow. It uses a “party-plan direct
selling business” where distributors set up in-home demonstrations. The
Pampered Chef uses this sales model as do dozens of other successful companies. I just found this Party Plan Directory site that lists many others.

Note: I am no longer involved in MyFamily.com, but am still an interested observer of the genealogy industry.

Auctioning Consulting Services

It’s nearly 3 am, and I’m having one of those sleepless nights, where
my mind is racing with new ideas and lists of things I have to do. I
know (from experience) that I won’t get back to sleep until I’ve
written things down. And while I’m at it, I decided to blog about one
of these new ideas.

For several months I’ve been contemplating a shift in my career from
pure startup entrepreneur to venture capitalist. I’ve been studying the
history of venture capital and have learned that many of the pioneers
of the industry and many of the leading VCs today don’t just look for
deals, but they create them. They help form companies, generate
business plans, recruit management, and act in many ways like
founders–they just don’t often run the companies.

This appeals to me a great deal. In fact, it is really what I’ve been
doing as a so-called "parallel entrepreneur" — the difference being
that I have been using a bit of personal seed capital for each of my
startups. How much better, I think, it would be if I became a
full-fledged VC so that I could invest more significant funds in these
startups, as well as providing training and mentoring for them.

So I’ve been pondering ways to make this shift.

In the meantime, my startups such as 10x Marketing, Infobase Media,
FundingUniverse, Web Evident, and Worldhistory.com are experiencing
growth (and growth pains) and overall are looking more and more promising. It
is difficult for me to take capital out of these companies in the form
of salary or consulting fees, when every dollar that I can keep in the
company is one dollar that can be used to help the company turn the
corner and get to cash flow positive. And my return in the form of
shareholder value will be far greater than any return I can get from
mere income.

Last night a relative asked me why I don’t just get a normal job. I
responded by asking: would you rather have a normal job with a salary
of say $100,000 per year or a harvest of $1 million every three years?
Internet startups can easily generate millions of dollars of
shareholder value in a short period of time (say 3-5 years). In fact,
the highest percentage growth in the equity value of a startup occurs
in the first few months of its existence where reasonable people
(such as venture investors) look at a business idea and the team that is determined to
execute on it and they often give the company a $3-4 million valuation
before it has even finished its product and taken it to market.

It’s not easy to get a multiple million dollar valuation for a raw
idea. Only 1-3% of companies that pitch venture capitalists get
funding. The strength of the team is of course a major factor. But tens
of thousands of new companies get started every year with investment
from personal savings and from family, friends, and angel investors,
and in almost every case there is an initial valuation that is
significant. If the company succeeds, then the early equity holders can
eventually cash out and do quite well.

I totally value equity in startups more than I value a salary or a
traditional income. But that can create a bit of a dilemma between
harvests — in fact, I am accustomed to experience serious personal
cash flow issues as my appetite for being involved in startups far
exceeds my ability to fund them. The good news is that perhaps 3-5
years from now the harvests will come more quickly, as multiple seed
deals per year turn into harvestable businesses.

But what to do in the meantime? I don’t want to take cash out of my existing startups, but I haven’t yet joined a venture fund.

So here’s the idea that is keeping me up. I’ve done some consulting
over the years, but I had a very hard time pricing my consulting
services. In one instance, I got a wonderful client in Canada, spent a
few days with them, worked feverishly on a marketing plan and internet
strategy for them, and delivered it. But while I was working for them I
discovered how serious their cash flow problems were and how the
founder was going into debt personally to pay my fees. I also realized
that my plan would work (of course I thought it was brilliant) but
would take additional capital for them to pursue it. I felt bad for the
company and waived all my consulting fees. All they did was cover my
travel expenses.

So I’ve learned that I will never been good at charging for my consulting servides.

But, maybe, I wonder, I could auction off my consulting services
through eBay or some other online system. The market demand for my
services would bring potentially dozens of companies into the auction,
and the ones that want my services most and could afford them would win
the auctions.

Since my consulting time during this transition period from internet
parallel entrepreneur to investor would be very limited, perhaps as
little as one day a week, then the limited supply of my time might
drive the prices up to a reasonable level.

I need such an online system to remove myself from the process, since I can be too soft or generous for my own good.

At 10x Marketing when we used to help companies set up auctions on eBay
for their products, we learned that conversion rates on eBay were often
significantly higher (sometimes several times higher) than our clients
pre-existing web sites. With that knowledge, we started directly
pay-per-click traffic to go directly to the eBay auctions. The more
people you can get into an auction, the better the conversion rate and
the higher the selling price.

So with my personal consulting, how could I generate online demand for such an auction?

I could of course use email, and notify some of my 2,600 personal contacts that I’m offering a day a week of my time.

Also, FundingUniverse has more than 1,500 registered entrepreneurs who
are currently seeking funding to grow their companies. Some already
have dozens of employees and significant revenue. These would be
candidates for consulting as well.

Also, I could use LinkedIn.com where I am two or three degrees away
from more than 650,000 people. I wouldn’t spam my LinkedIn connections,
but I might get introductions to a few dozen companies that I would
like to consult for, and invite them to participate in the auction.

And finally, I could always use Google and other search engines to drive traffic once the auction has started.

So here’s the question for all my kind readers (so that I can get back
to sleep): do you know of any individual or consultant or team that has
auctioned off their professional services? Also, what do you think of
this concept? Could it work? Could it work for me? Could it work as a
business model–an auction for consulting services–if the marketing
engine created enough demand to generate decent pricing for the service
providers?

I know there are lots of online systems such as eLance and rentacoder
where companies post projects and individuals or companies bid on how
much they will charge to do the work. But is anyone trying the opposite
approach? Are any attorneys, or accountants, or business consultants
using market demand to fill up their schedule and determine pricing?

Okay. So I’ve let everyone know where my career is heading, and I’ve asked you all for advice.

So g’night.

Using Credit.net for Sales Leads

I’ve been fortunate in my career to have a business partner, Dan Taggart, who is an expert salesman. In the early 90s, every computer and bookstore that he visited agreed to carry our products. As a telemarketer he is superb. Once when our in-house sales reps were only closing about 20% of incoming calls (to upgrade to our newest CD ROM product), to demonstrate how it should be done, he took 17 consecutive calls and closed 100% of them.

As a marketer, I focus my attention on generating leads for my sales teams. For consumers, this can easily be done on a web site by giving something away of value in exchange for contact information and permission to contact. For B2B sales I love Hoover’s service, although a subscription can be pricey for a startup.

I’ve recently seen a full page ad for Credit.net (from InfoUSA) that offers unlimited usage of 14 million business credit reports. I thought the ad said $50 per month. The web site says $75 per month and then $250 per month for unlimited “sales leads.” The sample data shows contact information, including key people, number of employees, revenue, SIC code, and competitors. It looks outstanding.

Question to my readers: has anyone used a Credit.net subscription to generate sales leads?