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Location_Based_Marketing_body.jpgby Robert Lerose.


As consumers rely increasingly on their mobile devices, some businesses are turning toward location-based marketing to stay connected. Location-based marketing uses technology that allows businesses to send messages to customers and prospects based on their physical proximity to the business, change offers quickly, and tailor highly specific ads to meet the needs of a customer at that moment. With around 75 percent of smartphone users relying on location-based services, according to a recent report by Pew Research, small businesses that jump on this new marketing tool could outpace their competition and hold onto a mobile customer base that shows no signs of staying put. 


Set objectives first

While the potential of targeting consumers as they near your business offers many opportunities for pulling them in, experts caution that you should first define your objectives before launching a location-based marketing campaign. "Different objectives might have different strategies. It's more important to start with what you want to accomplish," says Adam Kleinberg, CEO of Traction, a San Francisco-based interactive agency. "If you find that you have a lot of customers who are doing price comparisons in the aisle of your store, then it might make a lot of sense [to use location-based marketing]. On the other hand, if people are less likely to be using phones, it may be less opportune."


Social media and search engines, such as Facebook and Google, have services that can help small businesses partner with them to set up a location-based marketing plan in a defined geographic area. For example, Kleinberg says that he has gotten ads from a local donut shop within two blocks of his office through a Google search. And Traction put together a location-based marketing campaign for a neighborhood pizza parlor through the rating service Yelp.


Kleinberg says that ads in location-based marketing are much more simple and direct than traditional advertising. For example, a high resolution shot of the outside of your business with a short interesting call to action or time-sensitive offer can be a good way to test your ad.   


"Once you've got your objectives and goals, look for something that you can measure on an ongoing basis," Kleinberg says. "Try two different things side by side with slight variation so you're always improving. Digital marketing has the great power to set up simple experiments and improve results over time."


Creating custom content

"I think the biggest advantage of using location is just being more relevant to your customer and reaching them in a way that they want to be reached," says Brett Kohn, vice president of marketing for Thinknear by Telenav, a Silicon Valley-headquartered company that specializes in location marketing services. "We're starting to see more and more user traffic or customer traffic going mobile as opposed to finding them in the online world."



Kohn says that "contextually relevant content" in your ad performs better. For example, a restaurant that wants to promote a new menu could send a message that not only tells a smartphone user how close they are to the restaurant by distance, but which also has a countdown clock to the event. "Those are small things, but they’re little triggers that hit the customer's mind and can actually trigger a change in behavior," Kohn explains. "We're using that context to make the ad more relevant."


While small businesses can certainly partner with Google or Facebook, Kohn says that they have a more standardized approach to marketing that might not lend itself to new or innovative approaches. Instead, businesses can work with companies that can help them tailor content to individual customers or selected groups of customers.


For example, Thinknear works with many local auto dealerships. "We'll allow each dealership to create their own content that we can actually serve out in a systematic way so that each individual dealer doesn't have to manage every single piece of content," Kohn says. "They can deliver different content in each local market—which makes the user feel that the ad was created just for their locality. So if you've got two towns that are 20 miles apart, you feel like you're getting the ad just for your town."


Listen to your audience

"Know your audience. Once you know where your audience is online, it's easier to target them," says Peter Shankman, an entrepreneur, author, and CEO of The Geek Factory, a New York City-based social media and PR strategy firm. "The best thing you can do is ask your audience how they like to get their information—what platform they want. Then it's really about listening. Find out what they like—what they're talking about—and give them something they covet."


Shankman says that marketing messages must benefit the customer and should be relevant. For example, an ad that says "Buy Our Product" will not necessarily entice a customer. However, a simple ad with a message keyed to the person's circumstances—such as a convenience store that advertises a buy one/get one free cool drink on a hot day—would work much better. "Market a straightforward request," Shankman explains. "Users on average spend two to three seconds looking at a mobile ad."


Small businesses that keep close tabs on specific Twitter words can use them to develop timely location-based marketing messages. "There is a restaurant in Seattle that monitors Twitter for the term 'Wheels down' and 'SEA,' which is the airport designation for Seattle," Shankman says. "When they get a 'Wheels down SEA,' they look to see if that Twitter handle has ever been to their restaurant before. Whether they have or they haven't, the restaurant reaches out and says either 'Welcome to Seattle' or 'Welcome back. If you're downtown tonight, show us this Tweet and stop by and the first drink is on us.' And they have a tremendous response rate to that."

I was recently speaking with the head of security for Intel Security and he relayed a chilling small business cybercrime story to me.


A small surf shop in Southern California had been in business for a decade (notice the use of the past tense.) The owner’s computer was full of customer lists, vendor information, bank account information, passwords; the whole nine yards. And like most small businesses, the owner gave little thought to the sensitivity of such information, until it was too late.


One morning he came into his store, turned on his computer and found that he was locked out of the system. Apparently, a piece of ransomware, a particularly virulent piece of malware, surreptitiously installed itself in his computer. The owner opened an email that was supposedly sent from the FBI. Once he opened the email, the virus installed in his computer which caused the computer to lock up.


Another way malware installs itself in various systems is by creating phony web pages and then stalking people through social media. For example, the message: “Hey Bill - Check out this amazing Michael Jackson video that was recently discovered!,” may pop up as a social media post. Bill then clicks the link (because it’s from one of his hundreds of “friends” on Facebook) and the malware instantly installs itself.


Malware can be a detriment to your business. In the case of the surf shop, it did two things:


  1. It made the owner have to pay a ransom to unlock his computers. It’s called “Ransomware” for a reason. Typically, the software demands that the locked out computer owner pay a ransom of say, $500, to get an unlock code. Many small business owners opt to just pay it, like the surf shop owner.
  2. The surf shop owner got angry (of course) in the middle of the transaction and cancelled his payment. By doing so, the malware then deleted all of his records from the past 10 years.


It put him out of business.


When most of us think about cyber-security, breaches of large corporations like Target come to mind. But the fact is, small businesses are far more likely to be targeted than larger businesses or corporations. There are two main reasons for this: First, small businesses tend to not have cybersecurity software installed. This makes them easier targets, and second, when a small business pays a ransom (or has its bank account cleaned out, etc.), it doesn’t make the news in the way that similar security breaches of larger corporations do.


Click here to read more articles from small business expert Steve Strauss


In fact, the Target security breach (in which the data regarding some 80 million credit cards was stolen) was actually the fault of a small business. Target, like all large corporations, has tons of redundant cybersecurity systems in place. But one of its vendors – a small heating and air conditioning company – had none. So the crooks burrowed into the small business’ computers, and then when that company logged into the Target system to submit its invoice, the malware transferred from the small company’s computers to Target’s mainframe computers.


So the lesson is clear: As a small business owner, you simply must protect your computer system with cybersecurity software. And, not only do you need to have this protection on your main work computers, but it’s also just as important   that the programs are  installed on your laptops, tablets, and mobile phones. If you ever access your bank account from your mobile device, you get why that is.


So the best advice from the best experts is that cybersecurity is something small businesses need to take very seriously. You need to learn what suspicious online activity looks like -opening unknown attachments, clicking suspicious links, not downloading software or updates from unknown sites and sources, etc.. Teach these best practices to your employees, and protect your systems with a cybersecurity software suite.


Do it now. The life of your business may depend on it.

About Steve Strauss

Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert column is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest,The Small Business Bible, now out in a completely updated third edition. You can listen to his weekly podcast, Small Business Success, visit his new website TheSelfEmployed, and follow him on Twitter. © Steven D. Strauss.

You can read more articles from Steve Strauss by clicking here

Crowdfunding_body.jpgby Erin O’Donnell.

One of the most successful crowdfunding campaigns of all time raised more than $100,000 from 160,000 supporters in six months. The project? Funding the pedestal for the Statue of Liberty. The platform? Joseph Pulitzer’s New York World newspaper.

The year was 1885. Pulitzer’s campaign shared many of the hallmarks of a successful crowdfunding campaign: It had an emotional pull—the statue was a gift that couldn’t be received properly until the pedestal was built. It kept supporters updated regularly. It offered rewards for contributors. And it succeeded in a short span of time fueled by small donations that added up to about $2.5 million in today’s dollars.

The crowdfunding that’s taking place today began as a way for creative endeavors to get grassroots support, amplified by social media. Now, a growing number of entrepreneurs are interested in raising capital online and are bringing their ideas to websites such as Kickstarter, Indiegogo, FundRazr, RocketHub, and others. In 2012, business and entrepreneurship was the second most active crowdfunding category after social causes, according to This alternative method of raising business capital can be used alone or together with traditional funding from investors or small business loans.

“The entrepreneur is seeing a paradigm shift into the cloud and the crowd,” says attorney Michael Melfi, author of The Simple Secrets of Crowdfunding. “It’s transitioning the way entrepreneurs do business.”

How crowdfunding works

An individual or company submits a campaign to a crowdfunding site; some, like Kickstarter, require approval. The campaign sets a funding goal, a deadline (usually 30-60 days), and reward levels for supporters, whose contributions function as donations rather than equity investments. In most cases, you must meet your goal to receive any funding; if you fall short, you get nothing. The website takes its fee, usually four percent to five percent, only when a campaign succeeds, but newer sites are starting to offer variations. Indiegogo, for instance, has a flexible plan that charges four percent if you reach your goal and nine percent if you don’t—but you get to keep what you raised even if you fall short. Businesses also must pay transaction fees of three percent to five percent of the total raised.

In 2013, crowdfunding campaigns in the United States raised more than $2.7 billion overall. According to research firm Massolution, that number is projected to more than double this year. As competition for “backer” dollars grows exponentially, how can a small business stand out from the pack? Successful projects do at least four things well, experts say:

  • Build up a network, and credibility, before launching a campaign
  • Craft a solid business plan
  • Use compelling messages, especially video, to connect with supporters
  • Communicate with backers during and after the campaign

Melfi, who practices intellectual property law, also serves as general counsel for Funderbuilt, a crowdfunding portal designed for small businesses. Funderbuilt offers members a toolbox of resources to guide their preparation, and then scores each campaign with a Funderfactor. The process requires business owners to think through their business plans, Melfi says.

“It is opening doors for people who historically may not have thought of themselves as entrepreneurs,” Melfi says. “What’s exciting is that you’re seeing all kinds of entrepreneurs. For the person who’s been a successful entrepreneur or who already has some backing, they may turn to crowdfunding more for proof of concept.”

Build your network first

That’s what Bright Agrotech did when it lacked the cash flow to make a prototype for a new product line. The Laramie, Wyoming-based company created the ZipGrow tower, a vertical farming system. Founded in 2010, the company used YouTube videos to cultivate a following among the “eat local” and sustainable farming movement, says Chris Michael, director of marketing and operations. In 2012, the company leveraged that following to raise about $28,000 via Kickstarter, which enabled them to make the molds for a new home gardening product called the Spring System. They surpassed their goal by about $8,000.

“The idea was, we could outsource the funding of the development process to a degree,” Michael said.

In its first year, Bright Agrotech made about $10,000 in sales. This year, Michael says, the company is on track to reach $1 million, with about 15 percent of sales now coming from the new product. Michael says the company is proud to have bootstrapped its growth and remained true to the values that appealed to its customers in the first place.

“It allows us to stay super agile and keep the company moving without having to appease people who are not connected at a fundamental level to our company goals,” he says.

Offer an emotional investment, too

People who support crowdfunded projects want to feel they are part of the process, Melfi says, helping to turn a dream into reality.

Mike Whitehead knew cooks were rediscovering the superior qualities of cast iron and were concerned about potential health risks from aluminum and Teflon. But premium cast iron cookware was hard to find in the U.S., and vintage skillets were selling for up to $400 on online auction sites. So Whitehead founded FINEX Cast Iron Cookware Co. in 2012, updating the traditional skillet with an octagonal shape and a quick-cooling handle.

Ron Khormaei, who came on board as CEO the following year, had shepherded Kickstarter campaigns for other businesses. Khormaei could see the nostalgic appeal of the product and suggested crowdfunding to finance the company’s first production run. In 2013, FINEX, based in Portland, Oregon,  shot past its goal of $25,000, raising $211,027 from 1,558 backers on Kickstarter. A second campaign to fund production of a smaller skillet met its goal on day one, Khormaei says.

Whitehead became the face of FINEX, Khormaei says, through compelling YouTube videos and regular progress updates to their Kickstarter backers on manufacturing.

“That communication helped build a community,” Khormaei said. “They looked at FINEX as friends rather than a company. That’s definitely a requirement for any real success in crowdfunding.”

Develop a dialogue with supporters

Khormaei said that good will came in handy when the company suffered from its own success. They had planned on an initial production run of 250 skillets, but received nearly 1,800 orders. Khormaei says the company communicated early to its Kickstarter backers when they realized there would be a delay, and emailed them regular updates about the production cycle. Many of their supporters responded positively, saying they were willing to wait for a high-quality product from a company whose values appealed to them. Khormaei noted that people who support crowdfunding typically want to invest in ideas, not just shop for products.

When Molly Lofthouse launched Lenz Frenz, a line of stuffed animals that contain an eyeglasses case for children, she used email and social media to meet mini-goals along the way, and thanked supporters by name on Facebook.

“On Facebook, I would say, ‘Who’s going to get us to $2,000?’” Lofthouse said. “I got us to bump up our contributions several times doing that.” In February, Lofthouse met her $20,000 goal on Kickstarter. All 12 versions of Lenz Frenz are now in production and for sale through the company website. Lenz Frenz has also participated in two toy industry trade shows this year to attract large retailers.

Before the campaign, Lofthouse also reached out to bloggers and associations focused on kids’ vision issues to create buzz. She kept them updated, along with customers, both during and after the campaign, to build anticipation for the product when it went on the market. Afterward, she thanked supporters and also threw a party for those who could make it to her hometown of Austin, Texas.


Make rewards unique or meaningful

Rewards are a key incentive for crowdfunding support, and they’re part of the fun that appeals to backers. Many businesses thank donors by offering their product or service at a steep discount. Collector’s editions and personalization are popular as well.

Think about what else you can offer exclusively. Lenz Frenz’ top supporters received the first fruits of the initial product run they helped finance, along with the other rewards Lofthouse offered at lower levels. Bright Agrotech offered a reward level that unlocked a video tour of its greenhouse. Creative projects like film or music have offered top supporters the chance to make a cameo, meet the artist, or name a character in a book.

Leveling the playing field

Khormaei says crowdfunding helps to level the playing field, especially for entrepreneurs who don’t live close to centers of finance and venture or angel capital. Melfi says it also helps them to build up assets before they approach a bank for a loan. Or it can improve their negotiating position with venture capitalists.

“If done properly, crowdfunding tees up the entrepreneur for the next level,” Melfi said.

Social_Media_Advertising_body.jpgBy Jennifer Shaheen.


The holiday sales period is absolutely critical for many small businesses. Yahoo Business reports that the final two months of the year can account for up to 40 percent of some small businesses’ annual revenues. As a small business owner, should you increase your social media advertising to try and gain more sales?


Social media advertising definitely has a role to play in driving those sales, says Carmella Lanni, an e-commerce specialist with Moleskine America, a company that sells luxury notebooks. “Advertising helps to create exposure, build awareness and could possibly become a viable sales driver,” she says. “However, it needs to be connected to a strategy built on your goals for social media and how you want to be viewed by your customers. You want sales, but you also want to create an experience for consumers in your specific industry.”


A year-round practice

While social media advertising can get your company more attention and sales, it’s not a magic elixir that will fix all of your marketing problems. “If this is the only time of year that you are going to do a targeted social media push, then I do not think it is worth the investment,” says Todd Mansfield, CEO and co-founder of Pagatim, which creates custom audio content. “You will be lost in the crowd.” He recommends that business owners take a longer view, committing to regularly appearing content that has lasting value instead of trying to do it all during the holiday season.



Boost advertising effectiveness with storytelling

The holiday classic movie It’s a Wonderful Life contains valuable social media marketing lessons, according to Mansfield. Why? “Because it’s an amazing story that so many people can relate to,” he says. “Try to do that with your social media. Don’t push your product. Push great stories that are happening in the world and you will gain a kinship with people.”


In a very competitive marketplace, many business owners feel forced to slash prices. Mansfield cautions against making lower prices the exclusive focus of your social media advertising. “If you are just trying to meet your annual sales goal by pushing hard deals at the end of the year, how are you going to stay connected with those people for the next twelve months? They may come find you again next December, but they won’t be looking for you between January 15th and December 1st.”


Research platforms before you launch your social media advertising

While the vast majority of social media advertising may take place on Facebook, that doesn’t necessarily mean that’s where you need to be marketing your business. “Understand the social media channels where your target consumer groups are most active and engaged,” Lanni says. If your customers spend more time on Pinterest, the Knot, or other social media platforms, then that’s where your social media advertising will be most effective. As an added bonus, the ad volume on social media platforms other than Facebook is lower, meaning there’s less competition for your customer’s attention.


Test early, test often

To make sure you’re getting the most out of your social media advertising budget, you’re going to want to assess how well your ads are working for you. Facebook, Twitter, and Pinterest all provide reports that show how many people have seen and engaged with your advertising. Lanni recommends accessing this information as soon as it becomes available. “Test ad performance on relevant channels as early as possible to understand costs, data trends, and most importantly, customer interaction,” she says. If you don’t like what you see, adjust either your ad’s content or the targeting strategy you’re using to get better results.


Review performance after the holidays

The best way to determine if the investment in social media advertising was a wise one is to assess performance after the fact. Schedule time in January to analyze your sales numbers, your social media advertising spending, and the relationship between these figures. This information will help you determine your social media advertising strategies going forward.

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