Wednesday, August 29, 2012

I Can't Afford A PR or Publicity Campaign

It's a phrase I hear over and over again from many entrepreneurs, small businesses owners and inventors: "I'd love to hire someone to launch our publicity campaign professionally, but we can't afford it, so I'm just going to have to do it on my own."
Over the past several months, I have been conducting an informal survey among entrepreneurs and business owners who have contacted me about my services. I have found that due to their lack of information or knowledge on the topic, many businesses typically over-estimate or over-budget the cost of a prospective public relations/publicity campaign. During my PR consultation with them, I asked: "How much do you think it will cost to launch a solid, effective PR/publicity campaign for your product/business?" Of the 102 people I've queried:
  • 11% - Thought a professional PR campaign would cost $10,000+ per month
  • 32% - Thought a professional PR campaign would cost $5,000-$10,000 per month
  • 39% - Thought a professional PR campaign would cost $3,000-$5,000 per month
  • 12% - Thought a professional PR campaign would cost $1,000-$3,000 per month
  • 6% - Thought a professional PR campaign would cost less than $1,000 per month
The truth is -- you can get a publicity/PR campaign in all of those price ranges. What you get for your money and how effective the campaign will be is the real question. It is true that the more you pay the more you get. But getting the most publicity/PR exposure doesn't mean you have to get most expensive PR agency or specialist.
A good rule of thumb is to align yourself with a PR business that best reflects your business size. Most times their rates will be in line with your prospective PR budget. If you are a small business owner with two employees, you need not hire a high-dollar PR agency with dozens of employees. Find a PR business whose office size and capabilities closely resemble your business.
Case in point -- there is a large PR agency in a fancy building downtown a few miles from my office. Frankly, we are not even competition to each other - in fact we have even referred clients to each other. Why? They typically work with large corporations and implement campaigns of around $10,000 per month. My business works with smaller businesses/individuals -- a PR/publicity campaign with my company would be about $10,000 for an entire year - not just a month. Mechanically, the downtown firm and my business do the same thing when it comes to PR campaigns: professional media release composition; extensive media market research; articulate personalized distribution to the media; months of media relations (article placements/interview scheduling/media request fulfillment, clipping/tracking of media placements, etc.).
Signing up with the big firm doesn't mean you'll necessarily get an experienced associate working on your campaign. So are you getting what you are paying for? A friend of mine who works at a major PR firm gave me the following breakdown of billing fees in his office:
  • Interns/Junior Executives - bill at $75 / hour (Very little, if any professional experience)
  • Account Executives - bill at $100 - $125 / hour (1-3 years of professional experience)
  • Senior Account Executives - bill at $125 - $200 / hour (Multiple years of professional experience. Agency decision makers.)
Compare those prices to many small PR shops or individual PR specialists. Many have started their own PR businesses after years of experience in the industry and typically charge $50 - $100 per hour to professionally launch and maintain your campaign. Many times, you can get a seasoned PR veteran who will work directly with you and your staff for cheaper than the "Intern/Junior" executive rate at a downtown firm.
However, one word of advice -- when choosing a smaller firm or individual to do your PR, make sure they have the same tools that the bigger agencies do: updated media lists/contacts; personalized media distribution capabilities; professional clipping/tracking services to get copies of each of your media placements (articles, tapes from TV/radio shows) as well as the intangibles of expert communication/media relations skills and professional pitching prowess. If they are cheaper, but don't have all the tools to help you in the best manner possible, you are probably better off spending a little extra money to make sure your campaign is launched and maintained correctly.
The major benefits of hiring a professional (individual PR specialist or PR firm) to launch your campaign are:
  • Proper Campaign Implementation - Improperly composed or poorly pitched campaigns are the major downfall of many PR efforts. Poorly written, over-commercialized media releases; uncalculated, misdirected mass e-mailing of the release pitch; no follow-up media relations/media request fulfillment; etc.. Your first impression to the media is a lasting one - make sure it's a good one.
  • Media Contacts - Most PR agencies have established multiple media contacts over several years that can lead to much better and more numerous media placements for your campaign. Let their foot in the door benefit you.
  • Efficiency and Effectiveness - PR specialists/agencies generate publicity full time, 8-12 hours per day and know the ins and outs, shortcuts and secrets to getting the job done better and quicker. Sure you could hang your own drywall or do your own plumbing, but do you have the tools, the time and the expertise to make it cost effective. I always tell my clients, "You do what you do well, I'll do what I do well and we'll collectively move this business further up the ladder."
One caveat when it comes to choosing a professional PR agency or individual to work with - signing up for a higher priced campaign doesn't necessarily mean you will get better results than a cheaper campaign. And the inverse is true as well. Over the past year or so, many "low-cost PR/publicity services" have begun to pop up all over the Internet. Ones that promise to write and launch a press release for as low as $99. They are low in cost - because frankly many are low in quality. Bigger is not necessarily better, and cheap does not always mean a good bargain.
If you have the time, tools and talent to launch and maintain your own campaign, you should definitely do so. If not - there are a number of public relations/publicity firms, specialists and services out there. Research to find the one whose services and fees match your business plan. Once business owners, entrepreneurs, and inventors learn more about their options when it comes to launching a PR campaign -- many find that they can't afford NOT to have one.

Wednesday, August 22, 2012

When the Media Calls

If the media were to call you today for an interview, would you know what to do or say? That question was posed during a recent conference on small-business ownership and micro enterprise creation, which was held here in Paris. I watched the reactions around the room, and it occurred to me that for most small-business owners, the only thing more frightening than conducting a follow-up phone call with a reporter is having that same reporter actually interview them.
There is only one way to overcome the fear. You have to simply adopt and apply an old U.S. Army recruitment slogan, "Be Prepared." Don't get caught without an answer the next time the media calls. Follow these quick tips for success:
Ask the reporter to describe the subject and story angle for the interview.
Establish the medium for the interview (i.e. live or taped television, print, radio, etc.)
Discover when (date and time) and where (by phone, e-mail or in person) the interview will take place. Also try to determine if the reporter will need additional information from you, as well as the story's deadline.
Research the reporter's past articles so that you'll be comfortable with the story's tone.
Create talking points. These are brief positive statements about you and your company that you will want to be included in the story.
Anticipate the types of questions that that reporter might ask, and prepare truthful answers for them.
Assume that everything you say to a reporter - jokingly or otherwise, will be used in the story. Always be aware of what is being stated, and if an awkward silence develops, don't feel obligated to keep talking if you have no more to say on the subject matter.
Avoid speculation or hypothetical situations. It could lead to being misquoted. You are the expert so stick to what you know.
Admit when you don't know the answer to a question. However, make it your top priority to find the answers and deliver them to the reporter immediately. It is also fine to take a moment to think before answering a question.
Avoid using technical terms or jargon. You must be able to explain your ideas simply and concisely.
Take notes and don't be afraid to ask the reporters questions as well.
Make yourself available by phone or e-mail in case the reporter has additional questions or wants to do a final fact check before completing the story. This will help give clarification to something you've said or give an opportunity to fix something if you've misspoken.
Thank the reporter for selecting you for the interview.

Wednesday, August 15, 2012

Little Known Pitfalls of Traditional Publishing Industry

As many small-time authors and self-publishers have discovered the hard way, the traditional book publishing model is fraught with problems that conspire against an individual author/publisher making a decent living from their work.
The traditional model normally involves two basic choices: 1) use a commercial publisher, or 2) self-publish.
This option involves the author submitting book proposals or full manuscripts to commercial publishing houses in hope of acceptance.
Once a manuscript is accepted by a publishing house (the vast majority are not accepted) a contract is signed between the author and the publishing house. This kicks-off a time- consuming and often complex process involving printers, shippers, wholesalers, distributors, marketers, and finally, booksellers, all managed on the author's behalf by the publishing house.
Typically, it takes anywhere from 18 to 24 months from the time the author finishes a book manuscript, until the actual book gets onto the bookshelves.
The self-publishing option is one in which the author eliminates some of the middlemen and manages the overall publishing, distribution and marketing processes him/herself.
This option gives the author much more personal control of the whole process and allows him/her to earn more money per copy than through a commercial publisher. It also involves a lot of work by the self-publisher who is responsible for performing all of the functions and services that a commercial publisher would normally look after.
This model is normally less time-consuming in terms of elapsed time, since there is no manuscript submission and approval process involved. On average, the self-publishing process can save 6 to 12 months over the commercial publisher model.
Based on my first-hand experience with the North American book publishing and distribution industry, I have to say that it is one of the most archaic and poorly run business models that I have ever encountered. The entire industry seems to be decades behind current-day business practices of other industries.
Very few people know from the outset what they're getting into when they choose to publish their book via the traditional publishing route. They have no idea at the beginning just how backward, outdated and dysfunctional the entire conventional book publishing industry business model really is.
Here's what the conventional book publishing industry WILL NOT spell out to you before you sign-up...
Give Away Half Your Book's Value Up-Front
If your book's cover price is, say $30, you will be forced to discount at least 40% to 60% right off the top when selling your book to wholesalers and retailers. So, you'll really be working from an actual price of somewhere between $12 and $18 -- not the $30 you first thought.
Don't Count On Making Big Bucks
If you choose the commercial publisher option, the best you can hope to receive for your book is a royalty somewhere between 6% and 10% of the "net". The "net" is the amount the publisher receives AFTER discounting to retailers.
Example; cover price = $30; discount to large retail chain = $15 (i.e. 50%). Your cut would be somewhere between $0.90 and $1.50 per sale. So, for selling 3,000 copies (a very good sales figure) you would receive a grand total of somewhere between $2,700 and $4,500!
You'll Have To Write Lots Of Books
If you choose the self-publishing option your main distributor will pay you somewhere around 45% of the cover price of your book. Using our $30 cover price example; that works out to $13.50 per sale that goes to you under this scenario. Then you have to deduct your costs which include: printing the book, overheads, and marketing, publicity and advertising expenses.
Example: cover price = $30; distributor payment to you at 45% of cover = $13.50, before expenses. Deduct: printing costs - $3.50; overheads - $1.00; marketing, advertising, publicity - $1.00 = ($13.50-$5.50) = $8.00 per book sale. So, for selling 3,000 copies you would make only $24,000.
And don't forget, this option involves your ongoing direct personal time and effort involvement.
Wait Forever To Get Paid
Typically, you will have to wait between 90 days and 120 days after an actual book sale before you will receive your payment for that sale. I still shake my head at this one. How does the publishing industry get away with such an archaic practice in the 21st Century?
In normal business the standard wait for payment is usually 30 days, sometimes as much as 60 days; but 90 to 120 days to pay a poor struggling author? It's a crying shame that they still manage to get away with it. This kind of payment delay is the norm, whether you go through a commercial publisher or if you're a self-publisher.
Issue 100% Refunds On Unsold Books
A trademark feature of the conventional book publishing industry is the way in which it deals with "returns". In almost all cases -- publishers, distributors, wholesalers and retailers - they maintain the right to return unsold books to you, the author, for a 100% refund, even many months later!
Example: Say you sell 200 copies of your book to a particular retail chain through your publisher (commercial publisher model) or through your distributor (self-publisher model). Then, let's say that after five months, various stores in that retail chain find that 45 unsold copies of your book are still on their shelves. The retailer would simply send those books back to your publisher or distributor for a 100% refund. That company would would then routinely pay that retail chain a 100% refund for each book returned and in-turn would deduct that total amount from your account!
I'm not kidding folks, this is how it really works!
There is absolutely NO incentive for bookstores or publishers/distributors to make any extra effort whatsoever to move your book off their shelves since they know you will provide a 100% rebate for all "returns" in any case. Go figure?
Pay Them Extra Money... Just In Case
And just to add insult to injury, many publishers and distributors will also withhold funds from your regular royalty payments (20% or more) as insurance to cover the costs of possible future returns.
So, not only do you get paid 90 to 120 days late, you will NOT receive the full amount to which you are entitled, as your publisher/distributor hedges against the possibility of eventual returns of unsold and/or damaged books months down the line.
Get Stuck In Someone Else's Time Cycle
Most commercial publishers operate on a time-frame of 18 to 24 months from approved/accepted manuscript until the book is released for sale. If you are a self-publisher you can whittle this down to maybe 3 to 6 months depending on when your book is ready vis a vis your distributor's catalog publication schedule.
If you time it perfectly, or just get lucky, there might only be 6 to 8 weeks between your book being ready to ship and it getting it onto store shelves.
In addition to the foregoing, there are other problems with the traditional book publishing model which I won't go into here. So, as you can see, from an author's point of view it is a highly dysfunctional, badly flawed business model that wouldn't survive in most industries.
In fact, the system is so stacked against the average author I'm amazed that some people actually try to eke out an ongoing living in that thankless industry. I guess they feel they have no other choice, or they are hoping against the odds that they will one day get lucky and pen a mega best-seller.
So, if you are an aspiring author, and you're hoping to make a modest living writing and publishing your own books or ebooks -- the traditional book publishing and distribution model is definitely NOT the way to go.
The good news is that over the past couple of years a new publishing model has evolved that eliminates all of the negative aspects of the traditional publishing model and adds a number of additional benefits.
It's called the "Online Publishing Model".
It's a combination of online digital download delivery and print-on-demand (POD) publishing that sidesteps most of the pitfalls of the traditional book publishing model.

Wednesday, August 8, 2012

Six Sigma Tools for Process Control

Aim for perfection.
That's a pretty lofty concept. It's definitely not easy - especially when speaking of core business processes. Moving toward perfection requires measurement, analysis and documentation. And if you really want perfection, then you need more sophisticated tools. But is driving toward that ideal of perfection worth the effort?
If you want to increase quality and dramatically save costs in production, then, yes, the road to perfection is definitely worth the driving time.
Forward Steps, Quality and Processes
Last time, we discussed process mapping to increase communication and understanding within an organization and to effectively develop a system of procedures. Now, let's take a forward step, and look at how Six Sigma tools can decrease variability and increase quality in your processes.
Six Sigma, Pyramids and Systems
The Six Sigma methodology is an advanced set of tools designed for problem-solving and quality improvement. A 'sigma' refers to the standard deviation from the mean of a population. Standard deviation indicates the likelihood that your next data point will deviate from the mean of the data set.
At the bottom of the Six Sigma pyramid begins a system's current process capability. Usually at 1 or 2 Sigma levels is "tribal" knowledge based on first-time experiences. An organization moves up the pyramid to 3 Sigma as systems are put in place. To hit 4 Sigma, statistics and modeling tools are used for significant process improvement. And, finally, to aim for that near perfection, organizations apply DFSS, or Design for Six Sigma.
Measurement, Analysis and Documentation
Why do (and should) organizations use these concepts to move up the pyramid and toward quality improvement? Why is it necessary to measure, analyze and document processes - and, if needed, make those desired changes? Why drive toward perfection, and what does it mean in real terms?
If your current process capability runs at 1 Sigma, then that effectively means you have two defects (unusable products) out of every 3 parts. That means 67% of your costs simply become waste, with no return on your investment. At 2 Sigma, quality improves with 1 out of 3 parts as defects. But that still has an error rate of 33%. Not until 3 and then 4 Sigma levels will you see dramatic improvements. Put in these terms, you quickly see how such errors keep you from realizing a greater potential.
Transactions, Multiple Steps and Tolerance
Organizations most effectively utilize Six Sigma methodology in two situations. One, if a business works with a very high volume of transactions per year, then they can not tolerate low sigma levels. For example, a 99% effective rate for 1 billion transactions per year still yields 10 million defects. In any industry, that is not acceptable.
Another situation that calls for Six Sigma methodology is when an organization (i.e. manufacturing) has processes with multiple steps. Here total error rate is critical. For example, the effective rate is 99% for each step; however, that does NOT give the total error rate as 1%. You must take the 99% for the first step and multiply it by 99% for the second step, the third step, and so on. With a great number of steps, your total effective rate could significantly decrease. So, to avoid high volatility, this organization can not tolerate low sigma levels.
Organizations can also determine error rate by effectively reversing the typical process of Six Sigma. You can calculate the mean and variance in your process to define the error rate. This tells you where you are currently on the Six Sigma curve. For example, if your calculation tells you that you're on a 1 or 2 sigma level, then this is an area in need of improvement. This gives you an opportunity to look at the data more carefully, take the mean and variance of each step of the process, and determine in which step the process is having problems. Or it could tell if you there are many steps causing the problems and, thus, the cumulative increase in error rate.
Processes, Procedures and Control
Organizations use the Six Sigma methodology, because you can't get any higher than 2 Sigma ("tribal" or basic knowledge) without putting strong processes and procedures in place. And without strong processes and procedures, you can not move toward higher quality and system optimization - toward perfection. Are you really satisfied with 67% of your product lost as waste? Are you satisfied with such high variability in your system?
Problems, Resources and Results
If needed, you can change your process to reduce or eliminate this variability or error. Six Sigma methodology tells you when to take action to solve a problem. It moves an organization to consistently meet the requirements and minimize the resources used in its management system. And it creates the desired results for which the system was designed.
Systems, Control and Perfection
Remember, though, you can only get to 3 or 4 sigma by developing a system of policies and procedures of measurement, analysis and documentation. And with this you will easily see that reducing your error rate and moving toward perfection with Six Sigma tools is well worth the driving time - and, more, crucial to your system's control.

Wednesday, August 1, 2012

The Worth of Health Insurance

This article relates to the Compensation and Benefits Competency, commonly evaluated in employee satisfaction surveys. The questions included in this competency will help your organization determine whether your employees feel they are fairly paid for the work they perform when compared to a similar job at a different company. This competency also queries their feelings regarding the adequacy and quality of their benefits package. A fair and attractive compensation package is critical for hiring and retaining quality employees. A high satisfaction level in this competency requires that your compensation structure and benefits package be fair, balanced, and understood by your present employees.
This article, The Worth of Health Insurance, is part of AlphaMeasure's compilation, Tales from the Corporate Frontlines. It focuses specifically on the value of employer provided health insurance to employees in today's workplace and economic climate.
Anonymous Submission:
Large salary increases are rare these days, especially for mid level, mid career employees. Having worked at the same small, family owned business for about ten years now, my fellow employees and I were accustomed to getting about the same raise every year. It never varied very much, and we considered it fair, especially since the business was quite solid and successful with a steady profit stream for the past several years.
That's why we were all so shocked this year when our expected increase amount was cut in half. After the shock faded, the office was abuzz with speculation "the company is going under, that sales rep, Mr. Brown, lost that lucrative account, I knew this would happen, the owners are just getting greedy, they're thinking of selling to a large multinational" - were some of the stories considered.
Finally, our general manager caught wind of the discussions and settled us down for a meeting. He told us that the reason the increases had been cut was that the health insurance program premiums had risen very sharply. The owners decided that rather than require the employees to pay more for the insurance, it would be better to pay the extra premium and give smaller salary increases. He told us that many companies are handling rising premiums in much the same way.
Many employees, myself included, were skeptical. Sure, we told each other. That's a good story. And we picked up where we'd left off with our previous speculations.
That night, I received a phone call. It was my sister, and she was crying. She's a stay- at- home mom, her husband has been downsized, and the family is at the point where it has to pay for health insurance. As my sister tearfully recited the rates she'd been quoted, I was beyond shock. It amounted to a small fortune. After she hung up, I went online to my health insurance provider website. I checked the rate I would pay without my employer contribution. The price difference was far higher than my raise reduction, and the coverage wasn't as good.
Humbled, I went to work the next day and told my coworkers what I'd discovered. We'd all underestimated the worth of a solid benefit plan with good health insurance in today's workplace and economy. Suddenly our salary increase seemed a lot larger.