Negative Cost Selling/Guerrilla Marketing/Social Marketing

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Negative Cost Selling/Guerrilla Marketing/Social Marketing Presented by Professor Bruce M. Firestone Founder, Ottawa Senators, Executive Director, Exploriem.org, Entrepreneurship Ambassador, Telfer School of Management, Broker, Century 21 Explorer Realty Inc. B. Eng. (Civil) [McGill], M. Eng- Sci. [UNSW], PhD. [ANU]

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Negative Cost Selling/Guerrilla Marketing/Social Marketing. Presented by Professor Bruce M. Firestone Founder, Ottawa Senators, Executive Director, Exploriem.org, Entrepreneurship Ambassador, Telfer School of Management, Broker, Century 21 Explorer Realty Inc. - PowerPoint PPT Presentation

Transcript of Negative Cost Selling/Guerrilla Marketing/Social Marketing

Page 1: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Negative Cost Selling/Guerrilla Marketing/Social MarketingPresented by Professor Bruce M.

Firestone Founder, Ottawa Senators, Executive

Director, Exploriem.org, Entrepreneurship Ambassador, Telfer School of Management, Broker, Century 21 Explorer Realty Inc.

B. Eng. (Civil) [McGill], M. Eng-Sci. [UNSW], PhD. [ANU]

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Contents

Do you want to learn how to really make people want to buy from you?

Are you in the solution selling business? Do you know how to get on the ‘same side of the

table’ as your customers and clients? Do you want to learn negative cost selling? Do you know how to think in terms of 2-D and 3-

D business models so that you can not only take care of your clients but your clients’ clients too?

Want to understand Guerrilla Marketing and Social Marketing?

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The Power of the Brand

“People like to buy from people they like and trust,” Prof Bruce, Ottawa, Canada

“Have you ever bought anything from someone you didn’t like or trust?”

Trust (not love!) is the no. 1 thing in life and business

Marketing Builds Brand Builds Trust Creates Opportunity to Sell

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The Power of the Brand

Mutual Life Assurance Co. of Canada Clarica Life Insurance Co.

New sell-line: "Clarity through dialogue“Funny TV ads– Clarica Agent appears on

scene to clear up W/C ambiguityNo call to actionHow many people head for the phone to

buy some insurance?

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The Power of the Brand

None! Separate selling process“VP, Marketing and Sales” Doesn’t

know what he/she is doingLiving room pitch: “Take care of your kids!”“Where’re you from again?“Pirate Insurance Company of Kinakuta” or

“Clarica”– which helps you to close the deal?

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The Process

(2)Your

Reputation and Brand

build Trust in you

(3)Trust in you creates an

opportunity for you to Sell in a separate

Sales Process

‘TRUST POWERS SALES’

(1)Marketing through a Marketing

Process builds your Reputation and Brand

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Ethics

Probably < 1,500 key entrepreneurs in a place like Ottawa

Even NYC < 5,500Protect your reputationMajor Arch firm bids on Urban Design of

new Ottawa Congress Centre with our group

Jumps to winning bidder/takes IP w/out permission

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Ethics

Their name is … DIRTNo longer active to any great degree in

OttawaWhat should they have done?Ask for permission and ask winning bidder

to compensate group for their IP– would not even have had to pay it themselves!

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‘Intricate’ Your Clients

The late Elliot Richardson, former Attorney General of the United States

US Counsel to BRING BACK THE SENATORS

“Bruce, first we’ll intricate the NHL. Then we’ll get the franchise.”

(To honour Elliot, UrbanDictionary.com: http://www.urbandictionary.com/define.php?term=intricate+)

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‘Intricate’ Your Clients

“To bring people on board or to get them onside with an idea or a proposal or an initiative of some type by getting them 'intricated' into the process bit by bit, almost without their noticing that they are making a commitment.”

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‘Intricate’ Your Clients

How do you do this? Become an indispensable part of your clients’

business ecosystems/if you know your client’s History, you can become indispensable/hard to replace

How not to do it? E.g., typical Ottawa law firm:

Don’t keep clients’ clients tel. #s, email addresses on file Lose client e-documents Don’t know their r.e. client’s Banker, Surveyor, Environmental

Consultant, Insurance Broker, Title Insurer, Mortgage Broker, Appraiser or other suppliers

Wait to be told what to do

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Firestone’s Three Laws of Power SellingLaw No. 1: SITTING ON THE SAME

SIDE OF THE TABLE

Law No. 2: SOLUTION SELLING

Law No. 3: NEGATIVE COST SELLING

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SITTING ON THE SAME SIDE OF THE TABLE

GradeATechs.comAlt. 1: “We can sell you XYZ virus scan

software from Acme Corp. for 200 bucks. What do you think?”

Alt. 2: “We can get you XYZ from Acme for $200 or MNO from Beta for $150. If you don’t like either, we can get more quotes for you.”

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SITTING ON THE SAME SIDE OF THE TABLE

In Alt. 2, GradeA becomes: ‘trusted advisor’

Sits on same side of table as clientXYZ and MNO (+ all other suppliers) are

on the other sideGradeA has changed the equation!

SELLING TO A CLIENT HELPING A CLIENT BUY!

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SOLUTION SELLING

In r.e., buying a lot is a problemBuying a home is a solutionNew sub-division with 21 lots to sell

($125,000+) for client in KanataWhat to do?Make a deal with top quality home builder

to offer his homes w/ lots

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SOLUTION SELLING

How to sell this to builder? Intricate him!Offer him 6 lots for $500 each!$500 each?Yes!

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SOLUTION SELLING

That’s $500 for an 18-month option on those lots

Only pays for lots when sold to Homeowner

Co-brand sub-division with Builder– piggy back on his marketing

SELL SELL SELL

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SOLUTION SELLING

Know your client’s History and Biz Ecosystem

Hard to sell a solution when you don’t understand the problem

Ace Promotions– problem wanted to sell Golf Pros promo products

Issue?Most golf pros don’t have much spare

cash

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SOLUTION SELLING

But they have something of great value– a client list

Accounting firms and legal firms would like to get access to those clients

Eureka! Golf Pros have lots of time and no moneyAccounting and law firms have lots of

money but no money

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SOLUTION SELLING

Let’s solve all three problems (money, time and client access) together

By helping 10 Golf Pros buy 1,000 mouse pads each at $5.00 per item

That’s a $50,000 order for Ace PromotionsEach mouse pad is co-branded: golf pro w/

accounting or law firmLatter put up the dough/former becomes

distribution channel (gives them to each golfer)

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MORE SOLUTION SELLING

Ace is also trying to break into the auto dealership biz– SELL SELL SELL

Tom Smith Toyota is looking for more car buyers!

Ace must solve the problem: “How do you give out promo products to people who are not yet your customer?”

Ace comes up with new distribution channel for Smith Toyota!

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MORE SOLUTION SELLING

The humble ice scraper– solves allAce sells 10,000 ice scrapers to Smith

Toyota at $4.00 eachSmith Toyota also pays Ace $6,000.00 to

hire wage slaves (aka students) to go to co-operating: gas stations collision repair places car washes and give them out for free!

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MORE SOLUTION SELLING

Non-traditional outlets!They get the scrapers for free Can use them in their own promotional

efforts too– “Fill up here and get a free ice scraper.”

Car owners who frequent collision repair shops might need a new car some day (soon)

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MORE SOLUTION SELLING

The ice scraper also communicates!“Bring this ice scraper with you to Smith

Toyota < June 30th and we’ll pay you $250.00 to test drive one of our cars!”

Take solution selling one step further– provide your clients with ROI data

By investing (!) in your products or services (the ice scraper), they increase their revenues/lower costs or do both

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NEGATIVE COST SELLING

More from UrbanDictionary.com (http://www.urbandictionary.com/define.php?term=negative+cost)

“Negative cost selling is all about understanding your client’s business from their point of view and being able to measure the benefits you create and the cost reductions you cause.”

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NEGATIVE COST SELLING

Anthony owns (snail) mail order houseKnows that CPC/USPS now allow lumpy mail

campaignsVisits with local children’s charityWants to sell them on 3-year campaign at

$15,000 per yearHis pitch? Solve their problems:

How to get folks to open their snail mail? What’s the distribution channel? What’s the ROI?

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NEGATIVE COST SELLING

Includes flat (stone skipping) rocks with each letter

Sends letters to 800 (local) CEOs/Biz Owners

His firm has the names/contact infoEach letter challenges the CEOs (v.

competitive people) to rock skipping contest at Children’s Camp

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NEGATIVE COST SELLING

94% open the envelopes> 50% commit to attending themselves or

sending a rep> 400 attend at $750 each3-year commitmentCan buy extra rocks @$100/throw!Raise > $40,000/yearPlus CEOs on-site see the kids and

become sponsors…and fix stuff

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NEGATIVE COST SELLING

$15,000 investment $40,000+ = ROIMulti-year commitments recurring

revenue + create opportunity to not be a MLB-type player where every year you start with 000 home runs

YOU CAN NOT BUILD A SUCCESSFUL SALES PRACTICE IF YOU HAVE ALL 1-YEAR CONTRACTS

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NEGATIVE COST SELLING

$15,000 investment $40,000+ = ROI

Anthony’s pitch:

“I’ll pay you $25,000.00 per year to hire me!”

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NEGATIVE COST SELLING

Peter Patafie built Patafie’s Moving Supplies Inc. into $16 million/yr operation w/ one crucial sales innovation

His pitch: every moving co. would buy (cardboard boxes, wardrobe boxes, bubble wrap, tape, tape dispensers, wrapping paper) from Patafie’s

But instead of delivering them to the moving co., would deliver them to their clients instead

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NEGATIVE COST SELLING

Saves moving co. warehouse space Increases moving co. revenues because their

salespeople now have more time to sell moves rather than redeliver packing supplies to their clients

Got 97% market share (more than Microsoft)

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NEGATIVE COST SELLING

Peter understood his client’s ecosystem– including the needs of his clients’ clients (2-D Biz Modeling)

Sits on same side of the table as his customer (his customer’s customer becomes his customer– e.g., Peter sells them refurbished boxes and buys them back > move)

Uses ‘solution selling’ (by making his customer’s salespeople more productive)

Sells based on negative cost (since his customer’s customers are paying for the packing and moving supplies and ROI to moving co. ~ infinite!)

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Jeff Hunt and the Ottawa 67s

New way of responding to the 500+ charity and community requests

$600 needed for minor hockey tournament Give $600 x $500 or $300,000/yr.?Not affordable for Junior TeamLet them buy 120 game tickets at around

$5 each that they resell for, say, $10

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Jeff Hunt and the Ottawa 67s

Cost to 67s? -$600Cost to minor hockey team? -$600Developed new distribution channel: 500

charity requests 60,000 tickets sold/yr. raised $300,000 for 67s raised another $300,000 for charities

“Give a person a fishing rod, not a fish,” Anon.

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More from Jeff Hunt and the Ottawa 67s

Cost for naming rights for the Civic Centre $30,000

No takersInstead sold 30 companies @ $1,000 eachDraw winner: Civic Centre Urbandale

Centre for 1-yr termCost of Naming Rights for Urbandale?

-$29,000 -$550,000 (value of PR/earned media) = -$579,000

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Satellite Tracking Service

Sell Personal Tracking Devices (PTD) for executives visiting high risk countries

Not much bigger than cell phone Reduces cost of insurance Reduces frequency and cost of lawsuits—duty of

care Reduces losses from kidnapping, injury or death Reduces lost productivity from above and impact

on morale Can demonstrate very high ROI

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Crowd Wave Games

In-arena cameras, gesture control and vector aggregation software

~ 7th Inning Stretch with ‘brains’Cleveland Cavaliers– launch client‘Intricates’ sponsors– Section 315 plays

against Section 112 Winners get (say) $10 Verizon Calling

card

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Crowd Wave Games

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Crowd Wave Games

Reduce sponsor exodusBring new sponsorship dollarsIncrease game-day ticket sales and

reduce season ticket churnCWG demos very high ROI for CavsImprove in-arena experience for

fans/create team play feelings for average citizen/not available at home

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Yoga and Injury Reduction in the NHL Heather Moore, at Mountain Goat Yoga Centre in

Kanata More core strength, more flexibility, greater agility, better

balance, faster healing and lower stress levels Perfect fit for NHL Players Heather’s Yoga Fees: $7,267.86 for the season Savings to Team from Reduction in Injury: $352,201.28 Increase in Revenue due to Increase in Regular Season

Attendance: $523,939 Net Revenue from Extra Home Playoff Game(s):

$1,020,000

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Yoga and Injury Reduction in the NHL For an investment of just under $7,300, the team receives ~

$1.9 million in cost decreases and revenues increases

IRRYear (2006_2007)0 $(7,267.86)1 $1,896,140.67

IRR 25989% per annum

Value of going to Stanley Cup Finals: priceless “Heather will pay the Sens ~ $1.89 million to hire her!”

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Doug Cardinal and the Museum of Civilization

Architects can’t use –ve cost selling, can they?

Yes, they canDoug Cardinal believes in the sanctity of

the client or ‘patron’Former PM Pierre Trudeau was Doug’s

patronPublic Works nixed curvilinear walls for the

new museum– too costly and too risky

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Doug Cardinal and the Museum of Civilization

Doug asked the PM: “Do you want a treasure or another blah, boxy building for Ottawa?”

But he also understood NCS, thus:“If we build it my way, it’ll cost $20 million

more but it will attract 400,000 more visits per year at $10 per head. That’s $4 million/yr. With a cap rate of 8%, this increases value by $50 million. So the cost of a legacy project for you, Pierre, will be a negative $30 million.”

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Doug Cardinal and the Museum of Civilization

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The HR Recruiter Previous approach to selling? Beauty contest! Value Proposition = NCS Cost of Service = $30,000 Savings in Management Time = $10,150 x 2 (they

have to replace their candidate more frequently) Additional productivity (from superior candidate +

he/she remains on the job longer) = $200,000 x 2 Cost of HR Services = -$390,300

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The HR Recruiter Previous approach to selling? Beauty contest! Value Proposition = NCS Cost of Service = $30,000 Savings in Management Time = $10,150 x 2 (they

have to replace their candidate more frequently) Additional productivity (from superior candidate +

he/she remains on the job longer) = $200,000 x 2 Cost of HR Services = -$390,300

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The HR Recruiter

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GradeATechs.com Value Proposition = NCS Unplug Tower/Take to Computer Store: $19 of

your time Quote = Wait one week: $500 Lost Productivity Cost of Repair: $200 Call Grade A: $5 of your time Response time = 24 hours: $100 Lost Productivity Cost of Repair: $125 Cost of Grade A = -$492 IRR = 43% per day

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GradeATechs.com IRR = 43% per dayTime (Day) Cashflow0 -227 (cost of GAT repair + lost productivity + call to GAT)

1 100 (lost productivity)2 100 (lost productivity)3 100 (lost productivity)4 100 (lost productivity)5 300 (lost productivity + repair bill)

Solve (by iteration):

-227 + 100/(1+irr)**1 + 100/(1+irr)**2 + 100/(1+irr)**3 + 100/(1+irr)**4 + 300/(1+irr)**5 = 0

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GradeATechs.com

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Residential Realtor Value Proposition = NCS FSBO sale takes longer FSBO sells at lower price– listing becomes ‘tired’ FSBO pays commission anyway– to Buyer

Agent FSBO pays commission ‘thrice’– once to Buyer

Agent + lower sale price (Buyer reduces offer price since “there is no commission”) + they do all the showings/work

FSBO higher legal cost and risk of litigation

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Residential Realtor “The Lawyer who represents himself has a fool for a

client,” Anon. Agent: does 100s of transactions/FSBO: 1 or 2 For a home with a FMV of $315,000:

For a commission of $15,340 paid to Brokerage, Homeowner receives $38,188. Cost to hire Agent? -$22,754IRR? Infinite since Agent is not paid until and unless deal completes!

(See: http://www.ottawarealestatenews.com/ValuePropositionFSBOVersusAgency.xls)

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1964 Tribute Band

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1964 Tribute Band

Guerrilla Mktg: “Turn on your phones. Call a friend and let them listen to our next tune.”

Percentage of Audience who did: 25% New people turned on: 225 Number of shows: 140 per annum New people turned on: 31,500 per annum Cost of directly reaching 31,500 potential new

customers—a negative $6 million, since people pay them to show up!

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Pool.com SnapNames.com recognized leader in backordering

deleting domain names Clients were paying $60 USD for each backorder to

SnapNames.com Register any domain name for backorder on Pool.com

for free  Only pay Pool.com if successful Hundreds of 1,000s migrate to Pool.com Pool.com successfully gets > 3,000 deleted names/day

from Verisign Registry At $60/name + 2-yr registration fee = tens of millions

annually for Pool.com

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Pool.com

Cost to clients? Negative again!E.g., patent and TM law firmSay, registering 40 names for

backordering SnapNames.com: $2,400Pool.com: $0Cost = -$2,400 for backorder

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Pro Sports Teams

Pitching to: a Mortgage Broker “Invest in our Season Tickets, please!” “Why?” “Look at our great players!” “How about our beautiful building!” “Did you know you can escape our parking lot in

just 25 minutes!” “What a great logo we have and our

merchandise, my, my!” IT’S A BEAUTY CONTEST!

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Pro Sports Teams

“If you don’t buy a ticket, the team will move!”

“What kind of a person are you, don’t you have any civic pride?”

INSTEAD USE –VE COST SELLING! By giving two Sens tickets to every

Homeowner who sources their mortgage through you, you generate 2 to 5 more mortgages per season!

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Pro Sports Teams

Here’s how it works: The cost for two tickets to every regular

season home game: $55 less a 15% discount 2-year commitment Divert 40% of current marketing budget to

Sens Plus add another $2,655 The good news: other clients in this industry

are finding that they are generating 2 to 5 or more mortgages per annum

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Pro Sports TeamsFor an additional investment of $2,655 in

each of the next two years, make an additional $6,695 per year or a total of $13,385

ROI of 152% per annum Cost to buy Sens tickets: negative $8,076.70 Plus Mortgage Broker’s sales now >

Mortgage Alliance minimum to qualify for volume bonuses from. ROI increases further

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Pro Sports TeamsPlus Mortgage Broker’s sales now >

Mortgage Alliance minimum to qualify for volume bonuses from. ROI increases further

How about that?“Just initial here, here and here, sign and

date there. Thanks, Bye now.”

KNOW YOUR CLIENTS BIZ ALMOST AS WELL AS THEY DO

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Conclusion on NCS

NCS success rate will move from .200 to .300 or .400 or higher

Plus order size and speed to order will increase triple whammy (batting average/mass/velocity) to the bottom line

Removes the fear about selling– you know your clients’ businesses almost as well as they do

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Conclusion on NCS

Your projects get green lightedSelf-actualized human beings

working on projects they initiated with innovations they introduced and products and services that they fearlessly sell, are happier people!

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Negative Cost Selling: Blue Heron Storage Corp– Assignment Introduction

Kirk Douglas in a 1951 Billy Wilder film, Ace in the Hole, was a washed-up, broke, former NYC newspaper reporter who happened one day to be ‘marooned’ in Albuquerque, New Mexico.

He walks into the office of the local newspaper and tries to get an interview with the Publisher and Owner. He says to the receptionist: “Tell him I can help him make 200 bucks a week.” Intrigued, the Publisher agrees to see Kirk. Douglas immediately starts to sell himself and, finally, the Publisher asks him: “What about that $200?”

Douglas replies: “I am a $250 a week NYC reporter but you can have me for 50 bucks!” He gets the JOB at $60 a week.

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Negative Cost Selling: Blue Heron Storage Corp– Assignment Introduction (Cont’d)

If you want to be able to sell your product or service, you can learn a lot from this type of negative cost selling is all about understanding your client’s or customer’s business almost as well as he or she does. You have to be able to show the client that by using your product or service they will either reduce costs or increase revenues or some combination of the two by more than the cost of your product or service.

Here is a simple case study for a local Ottawa storage company.

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Negative Cost Selling: Blue Heron Storage Corp– Assignment

This case study demonstrates how Facilities Managers can make better use of expensive office space by using Blue Heron Storage Corp.

Step # 1Identify how much of your existing space is (inefficiently) used to store files, obsolete furniture, old office equipment and other little used materials. For this example, let us assume you found 8,100 square feet of 'stuff' scattered about your offices.

Step # 2Determine how many engineers and other personnel can be accommodated in that space. In this example, we will assume 180 s.f. per employee (gross) which means if we get rid of the stuff that is taking up needless room in our office building, we can accommodate an additional total of 45 engineers.

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Negative Cost Selling: Blue Heron Storage Corp– Assignment

Step # 3Determine the marginal cost of new space as if you had to go out and find it on the open market. In west-end Ottawa, Ontario lease rates in 2010 are in the order of $16 per s.f. per annum net, net, net plus operating costs and municipal taxes and utilities of about $15 per s.f. per annum for a total of $31. Thus, the cost of new space (your opportunity cost, if you will) is 8,100 s.f. x $31 per s.f. per year or $____________ per annum. (It's as if you had to build or buy or lease new space on the open market today.)

Step # 4Stack your materials efficiently with Blue Heron Storage (and get rid of things you don’t really need) so that you free up 8,100 sq. ft. in your existing building and take the minimum amount of storage space.

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Negative Cost Selling: Blue Heron Storage Corp– Assignment

Step # 5Because you are efficient, you find that only need to lease three storage buildings, each 2,000 s.f., from Blue Heron Storage. Blue Heron agrees to lease those storage buildings to you for $12 per s.f. per annum gross.

Step # 6Count your savings! Instead of opportunity costs for new facilities of $____________ per year, you only pay $____________ per year to Blue Heron. You save $____________ for every 45 engineers and every 8,000 s.f. you free up. And you don't have to build, move to or occupy new space. 

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Negative Cost Selling: Blue Heron Storage Corp– Assignment Step # 7

The cost to move one engineer into a new space is $900 per person. This covers the cost of actually physically moving of files, desks, PCs, etc. plus the cost of reestablishing the computer network and phones. In addition, no matter how good your movers are, your employees will lose 40% of their productivity the week before and 1/3 the week after the move. Each employee is paid and costs the company $1,500 per week including overhead costs and benefits.

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Negative Cost Selling: Blue Heron Storage Corp– Assignment Step # 8

You also know that your company has gross margins of 55% so you are losing output as well.

Step # 9

Calculate the negative cost of renting three storage sheds from Blue Heron by not having to find an additional 8,100 s.f. for 45 engineers.

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Negative Cost Selling: Blue Heron Storage Corp– Assignment

Step # 10

Help your clients make room for live engineers not dead storage!

Answer: $____________

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Professor Bruce M. Firestone

Fundamentals of MarketingFundamentals of Marketing

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ConsiderationsConsiderations

How much is this worth?

Professor Bruce M. Firestone

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1. Business Case Reviews2. Marketing’s Fundamental Role 3. The Importance of the 4 Ps4. Key Learnings5. Q&A / Discussion

Professor Bruce M. Firestone

What we will Discuss

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Sports Marketing – What We SeeSports Marketing – What We See

Professor Bruce M. Firestone

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Definition:

“ The process of designing and implementing activities for the production, pricing,

promotion and distribution of a sport product to satisfy the needs or desires of consumers and to

achieve the company’s goals”

Professor Bruce M. Firestone

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Increase brand awareness Establish brand image and trust

Stimulate demand

Educate consumers Create distribution channels

Professor Bruce M. Firestone

Marketing Goals

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UNAWARENESS

AWARENESS

KNOWLEDGE

LIKING

PREFERENCE

CONVICTION

ACTION

Hierarchy of EffectsHierarchy of EffectsC

on

sum

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eng

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Professor Bruce M. Firestone

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Marketing’s Ultimate RoleMarketing’s Ultimate Role

Professor Bruce M. Firestone

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PRODUCT

PRICE

PROMOTION

PLACE (Distribution)

Professor Bruce M. Firestone

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Case Reviews

Professor Bruce M. Firestone

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EventEvent

Sports ProductSports Product

PersonalityPersonality

Professor Bruce M. Firestone

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Ottawa Race WeekendOttawa Race Weekend

Professor Bruce M. Firestone

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Facts & Figures

• established in 1975

• 146 participants

• Not-for-profit corporation run by volunteer Board

Professor Bruce M. Firestone

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Competitive Landscape

Professor Bruce M. Firestone

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Let’s put ourselves in their shoes (pun intended!)

Professor Bruce M. Firestone

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Fundamental Marketing Challenge?Fundamental Marketing Challenge?

Professor Bruce M. Firestone

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GROW # of PARTICIPANTS

The life blood of a mass participation event

Professor Bruce M. Firestone

Fundamental Marketing Challenge?Fundamental Marketing Challenge?

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The 4 PsThe 4 Ps

PRODUCT

PRICE

PROMOTION

PLACE (Distribution)

They chose to

concentrate here

Professor Bruce M. Firestone

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Marketing Focus - PRODUCTMarketing Focus - PRODUCTEstablish the event as a runner-friendly even (meet the needs of the consumer)

• favourable course

• water stations

• health expo

• specific date

• transportation

• accommodation

• balance needs of elite vs. growing recreational runners

• event leadership provided by RUNNERS not EVENT people

• …..Professor Bruce M. Firestone

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Promotional activities

• attended other events (booth);

• Face-to-face personal selling

• Media partnerships established

• brochures, posters, etc

• athletes on Board

They established a brand position for their

PRODUCT and they became full-time, never-ending evangelists for the characteristics and

benefits of their product

Professor Bruce M. Firestone

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ResultsResults

Average of almost 14% yearly growthParticipation increased by 317% since 2000

Event challenge has now become growth management

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Today

• 2009 - >35,000 participants

• Canada’s largest race weekend

Professor Bruce M. Firestone

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EventEvent

Sports ProductSports Product

PersonalityPersonality

Professor Bruce M. Firestone

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Professor Bruce M. Firestone

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Facts & History

• established in 1994• Founder (Terry Sutherland) working with GE (technology and industrial design)• Approached by Canstar in 1992 to develop composite hockey stick• Passion for hockey so started a JV company; manufactured all sticks under Bauer name• 1997 Nike buys Canstar and stops all NA manufacturing• Terry and group buy JV company back and make private label sticks for Mission, Louisville and their own brand “Ballistik”• In 2004 hockey and baseball business merged under one name – COMBAT SPORTS • currently employ over 100 people

Professor Bruce M. Firestone

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Competitive Landscape

Professor Bruce M. Firestone

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Brand Position

Everyone at Combat Sports has a genuine love and enthusiasm for the game and our product. Our staff consists of elite level players, past greats and weekend warriors that truly understand the players needs. Not only are we regarded as composite design, manufacturing, and engineering experts, but we are also die hard fans and players of the games. Above all, we strive to understand what players need and want. We truly live by our motto:

Professor Bruce M. Firestone

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Let’s put ourselves in their shoes.

Professor Bruce M. Firestone

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Fundamental Marketing Fundamental Marketing Challenge?Challenge?

Professor Bruce M. Firestone

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Awareness, Education, Trial

Professor Bruce M. Firestone

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The 4 PsThe 4 Ps

PRODUCT

PRICE

PROMOTION

PLACE (Distribution)

They chose to concentrate

here

Professor Bruce M. Firestone

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Marketing Focus - PRODUCTMarketing Focus - PRODUCT• Owner of 11 patents (another 22 pending

• One of the few companies that manufactured (did not outsource)

• From Day 1, mission was to build the best hockey stick

• Interesting they don’t feel they are there yet but are close

• Launched with product offer of $100 stick with same / better quality than $250 stick

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• Initial marketing budget of less than $50,000• Gorillas in the market spending millions on traditional advertising• Challenge of perception of quality for unknown brand• Distribution StrategyLaunch: Individual Rep Program

Non-exclusive territoryHigh-margin but lack of control / visibility

Now: Retail dealer networkBrand recognition / demand high enough

Higher volume – margin and profitability

Marketing Focus - PLACEMarketing Focus - PLACE

Professor Bruce M. Firestone

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Continue to be grassroots focused;

Demo Days at targeted events

“From Day 1, we felt the most powerful

marketing tool was product seeding – getting

our product into the hands of hockey players.”

Professor Bruce M. Firestone

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• Entering NHL Supplier pool too early

• $60,000 investment before you test products, pay players etc.

• Bought in in 2007 but had to exit program and hurt credibility with Equipment Managers

• Lured by the appeal of the NHL shield

• Back in now with better strategy

BIGGEST MARKETING MISTAKEBIGGEST MARKETING MISTAKE

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Official Supplier

Unique Player deals

Influential coaches and instructors

Professor Bruce M. Firestone

Marketing Focus - PROMOTIONMarketing Focus - PROMOTION

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OTTAWA RACE WEEKEND TITLE SPONSORSHIP PRESENTATION

• Multi-million company

• Profitable

• Still privately-held

• Growing

Challenge is to stay nimble and manage aggressive growth

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ResultsResults

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EventEvent

Sports ProductSports Product

PersonalityPersonality

Professor Bruce M. Firestone

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Professor Bruce M. Firestone

Tony Greco

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Facts & History

• graduate of Sports Performance Institute

• Founder of the Greco Lean and Fit program and businesses

• Owns 4 fitness and martial arts schools/facilities in Ottawa

• Radio host / personality

• Personal trainer for several NHL players

Professor Bruce M. Firestone

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Competitive Landscape

Professor Bruce M. Firestone

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Let’s put ourselves in Tony’s shoes.

Professor Bruce M. Firestone

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Fundamental Marketing Challenge?Fundamental Marketing Challenge?

Professor Bruce M. Firestone

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Awareness, Image, Credibility

Professor Bruce M. Firestone

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The 4 PsThe 4 Ps

PRODUCT

PRICE

PROMOTION

PLACE (Distribution)

Tony concentrates here

Professor Bruce M. Firestone

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Marketing Focus- PRODUCT

•Building a product and brand

• Creating natural product line extensions from that core brand

• Expanding those product lines (e.g multiple fitness centre locations)

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Live Lean · Live Fit · Live Well

Transforming Bodies · Strengthening Minds · Lifting Spirits

Professor Bruce M. Firestone

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Professor Bruce M. Firestone

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• Brand position: CANADA’S LEADING FITNESS SPECIALIST

• VERY AGGRESSIVE PR / promotion campaign

Marketing Focus- PROMOTION

Professor Bruce M. Firestone

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• Community investment piece

• Great PR value

• Foundation created to fight Children’s obesity

“Differentiation”

Professor Bruce M. Firestone

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OTTAWA RACE WEEKEND TITLE SPONSORSHIP PRESENTATION

• Profitable company

• Growing

• Recognized market leader

Challenge is Tony’s capacity and sustainability

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RESULTS

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Guerrilla and Social Marketing

Guerrilla marketing (GM) is just another term for ‘smart marketing’

Do for a dollar what any fool could do for two

Uses leverage to efficiently and effectively get message out by way of earned media or through more direct means

Substitutes brains for cash in marketing wars

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Guerrilla and Social Marketing

If any piece of decommissioned Mir Space Station hits, everyone in continental USA gets free Taco

Taco Bell takes out insuranceCarried by major news outlets across the

planet

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Guerrilla and Social Marketing

Taco Bell’s NYSE symbol is GMSymbol is ‘YUM’Most companies would use ‘TBC’ YUM is better for food company, don’t you

think?

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Guerrilla and Social Marketing

GM exists in a grey legal area Never do anything that is illegal or

unethical or places any persons or property in danger

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Guerrilla and Social Marketing

Guerrilla Marketing Research?Conventional Market Research for Sens in

1990– ‘Would you buy season’s tickets for a NHL team in Ottawa?’

Predicts 100,000 season tickets can be sold

Submit happily to NHLChicago sells 12,000

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Guerrilla Marketing Research?Real buying decision versus hypotheticalMarket demand for mini offices in Ottawa

circa 1980s?Series of classified ads in local newspaper Telephone answering machine literally in a

cupboard at head office Selling ‘vaporware’ but get real sense of

demand

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Guerrilla and Social Marketing Guerrilla Marketing Research? Asking for commitment to lease mini office for a minimum

of three months at a fixed lease rate Strong response meant within two weeks building out one

floor in a west end tower and putting tenants in temporary offices at HQ

TCCL, Terrace Corporate Centres eventually became largest mini office provider in eastern Ontario with 164 mini offices in two locations with occupancy rate exceeding 94%

Profitable in its own right but also acted as source of new lease deals

Apple’s first offices in Ottawa? TCCL

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Guerrilla and Social Marketing Guerrilla Marketing Research?

More recent—developer needs to know what rents he might get for new, 2-bedroom units being built in west end of Ottawa

Property manager says $900 per monthREALTOR says $1,100 per monthWho is right and how to test it?

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Guerrilla and Social Marketing Guerrilla Marketing Research?

Property Manager bias—lower rents make it easier for him to fill new units(Cautionary note: reverse may also be true. If rents are set too low, it may scare off main stream renters who fear that place may be dangerous and that is why it is priced so low—remember, price conveys a lot of information beyond just dollar figure)

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Guerrilla and Social Marketing Guerrilla Marketing Research?

REALTOR also biased—he wants to sell units to investors so he wants to show highest possible rents and highest possible cap rate to investors

My suggestion was simple?In today’s Internet age test market it FOR

FREE

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Guerrilla and Social Marketing Guerrilla Marketing Research? Put two free ads on http://ottawa.kijiji.ca/: each ad

describes place slightly differently and each ad would have a different names to contact

Receive about same number of calls on each ad which happily (from investor’s POV) means rent of $1,100 per month will work

They also pick up sense that people calling for units at higher rent were associating higher price with concepts like ‘new’, ‘higher quality building’, ‘higher quality space’ and ‘better class of tenant’

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Guerrilla and Social Marketing Guerrilla Marketing Research?

1. It’s not hypothetical market research—it’s guerrilla marketing research for three reasons: a) it’s free or very low cost, b) you are asking about units that don’t yet exist and c) you are not asking a theoretical question (at least as far as the respondent is concerned), you are getting a real call from a real person looking for an apartment.

2. It’s not really ‘vaporware’ either—these units are for sale and for rent and will be built in the next eight months.

3. Typical of GM research, you are leaving out the fact that they are not ready right NOW so you are in a gray ethical area but still, the renter could be looking for later in the year anyway…

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Guerrilla and Social Marketing Getting a Place at the Table? Most large firms don’t want to give you a place at trough Students Design Clinic (SDC) Carleton University’s School of Architecture Student-run enterprise SDC is passed on from one student generation to next

with junior designers becoming senior designers and most accomplished senior designer becoming Chief Designer

Oral tradition Surplus (over and above what they paid to students) of

more than $80,000

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Guerrilla and Social Marketing

SDC is itself a guerrilla institution—officially frowned on by University’s Administration

Concerned about liability in case of dispute over fees or one of designs is sub-standard

Submit for building permit and meet the OBC (Ontario Building Code)

Liability seems manageable

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Guerrilla and Social Marketing

GM program for Clinic is simple and some techniques are old

What is GM?Is it? a) do stunt, b) get national press

coverage, c) send out mass email, d) put out a tweet on Twitter, e) stand back and watch traffic counter rocket or app downloads multiply?

Bad news—not that easy

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Guerrilla and Social Marketing

1. Use lawn signs: if politicians use them, it’s because they work and are cheap. On-site signage is great: pylon signs, lawn signs, sandwich boards, window decals, whatever—they’re cheap and they keep working 24/7. Maybe you want to bring back the walking billboard (a person wearing a sandwich board) or better yet: a person wearing a sandwich board giving out handbills which have a call to action on them. So use lawn signs at all your job sites with your Students Design Clinic logo and telephone number and URL clearly visible.

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2. Lawn signs should cost no more than $10.00 each. Leave them up forever or until your client takes it down.3. Add some type of call to action. How about: “Free One Hour Consultation”4. Put your tag line and your logo on your lawn signs. You are a design clinic so your marketing stuff has to look sharp otherwise it is reverse marketing (don’t do this!)

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5. Create a second web address that points to existing Carleton address (www.arch.carleton.ca/clinic) which is a bit clumsy. Note: check out www.domainsatcost.ca which is one of Canada’s largest domain name registrars. Try for something like: www.studentsdesignclinic.ca or www.designclinic.ca. (Editor’s note: these URLs are not currently active.)

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6. Create both private and public spaces on your website. The private password protected space is and will become your ‘institutional memory’ of what works and doesn’t work over a period of years. (The same thing was done for www.kosmic.ca so that students aren’t starting from scratch every year for goodness sake.) Put in things like how to hire and fire; what to pay people; how to monitor performance; how to interview and select team members, what marketing worked and what didn’t—all the hidden keys to success…

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7. Use PSAs (Public Service Announcements) addressed to print, TV and radio outlets. Your PSAs should go to local publications too such as the Kanata Kourier Standard not just the Ottawa Citizen and the Ottawa Sun. Give them visuals as well.8. Get testimonials for your website and your flyer.

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Guerrilla and Social Marketing

9. Create a logo for the Clinic and a tag line that is on everything. Terrace Corporation (the first parent company of the Ottawa Senators) was in the real estate business; they used “Great Space for Great People”. You’ll want something different—it is much too commercial but you need something that speaks to the core competencies of the clinic and your mission.10. Keep a customer data base of tel. #s, fax #s and especially email addresses. The best place to look for new clients and new work is from your existing clientele.11. Every year you should email your past client base with the “news”—what is up with the clinic this year.

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12. Do a flyer drop not just around the University but also in Kanata, Nepean and Orleans as well as downtown—anywhere people are doing a lot of renovations. Flyers to the home or office are cheap and cheerful and often effective. But don’t wait too long to get them out. They need to go out in February or March not May or June, that’s far too late. Don’t forget to include your call-to-action like ‘Free Quote’ or ‘Free One Hour Consultation’ or ‘10% off’ or ‘Fill in the attached ballot and return it to win great prizes’ or whatever. You can use a variant of the Flyer—the Handbill. It’s a bit different in the sense that it is exactly what it sounds like: a ‘bill’ that passes from your hand to a potential client’s hand directly. It is an old marketing concept but it can be remarkably cheap and effective. And you know that it got to the recipient for sure. Handbills can be given out at a trade show, for example. Something else to remember: marketing is about consistency and repetition. When our family was a partner in a tool and equipment rental chain, we found that our flyers became more effective over time. People began to expect them and to use them more often when we repeated the drops in the same neighborhoods a second, third or even a fourth time over a period of two years.

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13. Do a customer satisfaction survey. This is where you will get testimonials, references and permission to use them. Put them on your website and on your flyers even in your PSAs.14. Let your clients know that you are never too busy for referrals.15. Avoid expensive advertising and major media like radio, television and daily newspapers.

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16. Use word of mouth, flyer drops, PSAs and lawn signs.17. Your website is just a support tool but an important one.18. Put photos of finished work on your web site—create a Design Clinic portfolio.19. Everyone is in sales—Chief Designer, Assistant Manager, Senior Table Leaders, Table Leaders, Senior Designers and Designers.

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20. Make sure you have 24/7 telephone messaging and design clinic email accounts.21. DON’T call your Junior Designers ‘Junior Designers’; just call them ‘Designers’.22. Your next level up is Senior Designer. And so forth—yes, it’s title inflation but it works well in marketing your services. No one likes to be called ‘junior’ and no one wants to hire anyone called ‘junior’.

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23. Put ‘Free One Hour Consultation’ everywhere—on your website, on your brochure and on your lawn signs. People love FS (Free Stuff).24. Put on your website a few simple to understand reasons why people should choose the Clinic like supporting students, like the exceptional quality of your work, like getting really top notch people to work for them at a fraction of the price they will command just a few years down the road.

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25. Your flyer should use colour—it is more costly but you are in the design business. Last year 1,000s of good quality colour flyers (8.5 x 11) were printed (one side) for less than 25 cents each.26. Put a copy of your flyer on bulletin boards in stores like IGA, Loblaws, Canadian Tire, Walmart, Home Depot, Home Hardware, building supply stores, etc.

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27. Coroplast signs are very inexpensive (about $5 to $10 each for 18 inch by 32 inch signs with either two-colour or full colour decals). With the SDC URL, logo and tag line, they make good posters which can be put up with a stapler or plastic ties on hydro poles or city owned fences. (Note you should probably ask for permission from the municipality but in guerrilla marketing people often don’t.) If you put them up high (use a ladder for this), your signs tend to stay up longer. City workers don’t like to get out of their vehicles to unload a ladder, carry it, erect it and climb up the pole to tear down your signs. They’ll call you and you can volunteer to take them down yourself. Perhaps they may reappear somewhere else in the City.

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28. You can offer to do a few free design jobs using your trainees and the local media can be invited to review the work. Better yet, do a few free designs for high profile persons in the community and get them to talk about it on their shows, blogs, what have you. Get a free endorsement or plug from a local celebrity.29. You can offer to let people buy ‘gift certificates’ for design services for friends and family.

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30. You can run a contest on your website. The winner receives, say, $200 of design services with first, second and third runners up receiving $75, $50 and $25. The winners always end up spending more.31. Contests could be something like: putting a piece of a famous structure (the Roman Coliseum, the Acropolis, Scotiabank Place, for example) on your website, add to it every day and the first person to email you with the correct identity, wins.

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32. You can develop a $20 coupon program and give out the coupons to clients and to others to give to their friends. You can also print the $20 SDC coupons in local newspaper ads and folks can clip them out and bring them to the clinic.33. You need to visit established architecture firms to co-opt them into your business ecosystem. Many architecture firms don’t have time for gazebos, decks, fencing, basement renovations or small additions. They would prefer to refer these clients to the SDC.

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34. Faces are very important in marketing and that includes GM. You need to put a picture of yourself and your team on your marketing materials (web, flyer, maybe even your lawn signs). That way people can see the faces of all your happy, smiling, enthusiastic designers. If there is one ad with a face in it and another without one, the former will get a lot more attention.35. Because this is a design studio, you should probably also have a watermark in addition to your logo. The watermark reflects the underlying principles of your work and is used as a half tone (or a sidebar) on all your drawings, contracts, marketing materials.

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36. Can you accept Visa? You should probably ask your bank for that service—folks love paying by Visa and even though you have to actually pay a fee (probably 2.75 to 3.25% of each transaction) it will save you a huge amount of time and frustration actually getting paid and the amounts people will spend on design services will also go up! This is a double whammy on your bottom line—collect faster and collect more.37. Don’t forget to ask for a retainer up front. It should be around 45%. Try to get another 45% when the drawings are submitted for building permit. Get the last 10% when you actually get the permit.

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38. You can set up a referral system—for each client referred to the Clinic that signs a contract, you can offer a premium like a really fantastic SDC t-shirt. This is more promotion for the Clinic—people walking around wearing your logo (and URL)!39. Let people buy your branded promotional stuff. You are, after all, a design shop. Why just limit yourselves to designing real property? Why not use those skills in your marketing as well to create really insanely great branded clothing and promotional items?

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40. Put out media releases every time you do something newsworthy and feed the press regularly. Make the title catchy: how about Third Wall Theatre Group in Ottawa who put out a press release with the title: “Directors Stab CEO in Boardroom Uprising” to promote Julius Caesar. They got attention in a hurry from the media.

Today, we would add a few new things to the above list including:

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41. Use social media—start your own Facebook group and use Twitter to develop a following; use these as tools for CRM (Customer Relationship Management) as well.42. Start a blog for the SDC highlighting interesting and challenging jobs you have tackled.

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43. SEO, Search Engine optimization can do wonders for your website. By increasing your profile in search engine results, you can turn your website into a big lead generator for da nada. SEO includes things like link trading with all your friends’ websites so that more sites link to you. Search engine algorithms look for how many sites link to you as an indicator of how important you are.44. Give your company or organization a name and a website address that are identical so you don’t waste any effort branding different names.

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45. Go to trade shows like the Ottawa Home and Garden Show and use giveaways (promo items) that are branded with your logo, name, tag line, contact info and some type of call-to-action.46. Network like crazy and use your employees’ and suppliers’ networks too.47. Try to sell to people you buy from (reverse selling). Your AP, Accounts Payable can be a good source of leads. At the Sens, if we needed a plumber he or she was certainly going to be a season tickets holder.

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48. Volunteer for worthwhile causes in your local community.49. See if you can create an event that’s fun and helps promote your business and doesn’t cost you anything or maybe even generates revenue for you.50. Do some polling: people love to be asked their opinion on just about anything.51. Create a market survey: people like to be asked for their views. They’ll answer your survey, which will also generate information and leads for you.

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52. Create some type of scoring test on a subject of interest like when to know when it is time to replace your roof or windows…53. Follow the trail of really bad marketing to see who needs your help in your industry. Maybe a local builder needs the SDC’s help with one of their design issues.54. Make sure you can explain your value proposition in three to five separate points to give people a few simple, compelling reasons to buy from you.55. Find sponsors or patrons for your business or organization. Create something that they can sponsor and benefit by.

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56. Bid on jobs even if you know you might lose: you end up knowing everyone involved with the process; you can build up your network this way for next time. It’s a kind of win-by-losing strategy.57. See if you can get volunteers to help you.

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58. Don’t forget the Yellow Pages and its related website. Yellow Pages ads are expensive but I have found that even a three line ad can be effective. This give you enough room to have your name, tel. #, URL and tag line. If you can afford it, add one or two more lines for a call to action like ‘Free Quote’ or ‘One Hour Free Consultation’. Your logo would be nice too. You can also sometimes place your ad in a non traditional category where you can stand out. Maybe sneak your design shop into the building supplies category by asking one of the big advertisers there to add your design shop to their ad. Perhaps you could convince them to do that for free…

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59. Try negative cost selling: it’s huge and works really well. Show the client (preferably with a spreadsheet) how he or she either makes money from buying your products or services, or reduces costs or both. This requires a level of understanding about your client’s situation, which you should have anyway. For example, show them how a basement renovation or adding a granny flat is a negative cost when compared to, say, putting your mother-in-law in one of the those vertical warehouses called a retirement home. (To read more about Negative Cost Selling, please refer to: http://www.eqjournalblog.com/?p=482.)

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60. Use co-branding. Who is in your business ecosystem? Would they want to pay some (or all or more than all!) of the costs of your marketing? For example, maybe there is a building supplies retailer who provides lumber and other construction materials. Or a builder or landscaper who is winning lots of work designed by the Clinic. Perhaps they want to co-market with the SDC and pay some of your marketing costs. (For more on co-branding and cross-selling, see: http://www.eqjournalblog.com/?p=571 and http://www.eqjournalblog.com/?p=571.)

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There are so many ways to use GM, the list really is endless and today, through the Internet, a small enterprise can leave big tracks.

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Guerrilla and Social MarketingMarketing is a mystery/it’s subtleDon’t need Yellow Pages ads or flyers any

more?How did you hear about us?Answer: Google, Twitter, FB…Get rid of Yellow Pages and flyers?Maybe yes, maybe noMaybe customers really saying their last stop

was Google but forgot to mention saw your flyer or Yellow Page ad before?

Page 172: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingLocal high tech company doesn’t have the

marketing budget to put inserts into the local newspaper for distribution to their target market. So early one morning, the founders go out with abundant pocket change and they open the paper boxes and insert their marketing brochure; then close up the boxes and wait for the phone to ring. Student note: this is probably illegal. Don’t do this but it is an example of clever thinking nonetheless.

Page 173: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingAnother tech company, looking to recruit

top talent, put up hundreds of $2 placards along the main drag where techies working for their competitors tended to drive. They put them up on a Thursday night after city workers had gone home and they remained up for six days before the City had the (illegal) signs removed. The campaign was cheap, cheerful and successful.

Page 174: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingOld Milwaukee Guerrilla Marketing How can you outperform a $3.5 million

Super Bowl commercial with a $700 to $1,500 North Platte, Nebraska TV buy and a ridiculously badly produced ad?

That’s what’s possible in the 21st century via social media

Page 175: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingOld Milwaukee aired a 30-second spot on

NBC affiliate KNOP-TV 2 in one of the smallest markets in the US during Super Bowl XLVI

North Platte has just 15,180 TV homesIt didn’t cost them very much but gave

them the cred they needed to say it was in fact a Super Bowl ad

Page 176: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingFirst, they got 1,640 mentions on Twitter

then a YouTube user by the name of Daddymcc uploaded a cheapo copy of their Will Ferrell-cameo advert to YouTube

So what did Old Milwaukee do next?

Page 177: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingThey turned their IP lawyers loose on

Daddymcc, YouTube and Google, of course, to force them to take down an unauthorized version of their ad

They sent them a sternly worded cease-and-desist-letter threatening them with legal Armageddon

Not!

Page 178: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingWhat they really did was link from Old

Milwaukee’s official Facebook page to Daddymcc’s upload

After that, they got over 1 million views in the 11 days subsequent to the 2012 Super Bowl compared to say Budweiser’s professionally-produced eternal optimism Super Bowl ad (http://www.youtube.com/watch?

v=enfJEibY1nY) which got just over 400,000 in the same time period

Page 179: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingThe Old Milwaukee ad is beyond cheesy

(http://www.youtube.com/watch?v=tejGMPAShdY)Guerrilla marketing (in this case, a form of

ambush marketing) is about substituting brains for money

No way can OM compete with Bud’s deep pockets so they did this instead

It’s what entrepreneurs do every day

Page 180: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingAmbush marketing tends to happen every

four years when the Olympics come up. It is so expensive to be an official 5 Olympic Rings sponsor that even major companies are sometimes forced into guerrilla marketing

Or perhaps if they are shut out of the Olympics by a competitor who has category exclusivity, they could decide to ambush both them and the Olympic movement

Page 181: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social Marketing A while back a major shoe company did ambush

marketing at Atlanta Summer Olympic Games While one of their competitors paid $40m to be an

official sponsor, they set up a mega tent on a parking lot down the street from the main Olympic venue

They filled the place with product, interactive games, VIP sections, you-name-it

It became the in-place to be during those games and they scooped the competition and scored a major PR hit—both admiring and outraged reactions were welcomed

Page 182: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-brandingLululemon Athletica not only sells active

wear they also have Yoga classes in their stores

In essence, they are housing two complementary businesses under the same roof

But there is no reason why they could not be offered by two different organizations

Page 183: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-brandingKey is to view enterprise as a platform on

which to build a community of interestsWhat services or products does it make

sense for you to bundle with your core offering (i.e., they complement it)

Or can you unbundle/break apart your core offering to uncover separate services or products that could be offered by others?

Page 184: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-branding If you get others to use your platform, you push some of

your capital costs onto them Becomes a form of bootstrap capital May also pay you both a rights fee and rent just to be part

of your offering! Lululemon could rent stores to Yoga professionals for

classes and create two revenue streams that way—more clothing sales plus hall rental

Also a form of negative cost marketing since Yoga studios would be paying Lululemon to bring their clients to Lululemon stores

Similar to co-branding and co-opetition

Page 185: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-brandingTCCL, Terrace Corporate Centres, largest

mini office provider in Eastern Ontario  Word processing business  Lost about $3,000 per month Unbundled business/spun it out to

independent entrepreneur (who paid $50,000)

Turned it around in just six monthsWent from cost centre to profit centre for us

Page 186: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-brandingMountain Equipment Coop sells bikes,

running shoes, kayaks, canoes, outdoor clothing, cross country skis…

Adding 500 square-foot space to existing store in Westboro

Making it available for community use by sports and environmental groups

Want to be more than store– a central part of community commitment to active lifestyle

Page 187: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-branding Apple this with their stores You not only buy Macs, iPhones, iPads, iPods et al

but also attend free workshops, get stuff repaired, ask for assistance at Genius Bar, get help setting up your computing and communications environment, learn how to use iTunes and app store, get one-on-one training if you need it…

It’s all about bundling services around your core offering and creating a platform

Page 188: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-brandingBundling can also involve co-brandingEg, marketing Brooks Brother’s suits with

Audi cars and Rolex watches or, better yet, bundling them all together—buy Audi and get Brooks Brothers suit plus Rolex thrown in!

What’s interesting is that these three products can become sales channels for each other

Page 189: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-brandingHere is unlikely duo: Xerox co-promoting

Michelin in its advertising in Bloomberg Businessweek (March 11, 2012)

Page 190: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-brandingNo more unlikely than Michelin starting its

Michelin Guide in 1900 to help motorists find accommodation and restaurants

Anything that got more people driving further and more often was, indirectly, good for their tire company their thinking went

However, Guides became own profit centres

Page 191: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-brandingThat is, they stood on their own As well as providing negative cost

marketing and co-branding for tire company

These concepts are not new but forgotten by successive generations only to be rediscovered...

Everything old is new again…

Page 192: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-branding Bundling is gaining traction as a biz model tool Recent announcement by Chrysler that it will

certify and sell used cars by OTHER manufacturers

Why not extend their warranty program? It is a profit generator Plus having more people, some of whom are

perhaps not interested in Chrysler but are in say Hondas and Toyotas, come to their stores means that, at least, now they have a chance to persuade them otherwise

Page 193: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-branding Not easy to tell difference between hardware,

software, consulting, outsourcing, products, services or app tech company

They are all using biz models as platforms to poach on each other’s territories

Become counter cyclical Makes more efficient use of fixed costs caused

by their underlying investment in office, lab and manufacturing space as well as administration costs, investment in staff and staff training, equipment and other basic requirements without which they cannot operate

Page 194: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-brandingIn entertainment business, Bloomberg

News’ Norm Betts reports that Netflix CEO Reed Hastings meeting with cable operators to discuss a way for Netflix to be included with monthly cable bills

This would be a way for Netflix to add huge new numbers of subscribers by using existing cable networks as, in effect, Netflix resellers

Page 195: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Bundling and Co-branding Netflix would then be on more level playing field

with Showtime, HBO and other specialty cable channels

More subscribers, steadier and higher committed monthly recurring revenues

Better able to compete for directors, screen writers, stars, talent, screen plays and so be able to offer more original content– series and films

Bundling while developing reseller sales channels will make Netflix an even more formidable competitor

Page 196: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingEthicsOne of keys to success is to be accepted

part of your business ecosystemOnce you are embedded in a business

ecosystem, you are very hard to dislodgeTrust is No. 1 thing in life and businessDo not engage in unethical practices in

GM or anything else you do

Page 197: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingMedia ReleaseMedia releases are tricky to do These days people are saying they’re less

relevant as mainstream media fades Mainstream media still mattersFor how long, no one knowsBut one thing is clear, it matters less than

it once did

Page 198: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingYou can talk to more people in a few

seconds on ABC World News with Diane Sawyer than you can if you gave a speech before a live audience of 1,000 people for 7,950 days in a row*

Almost 22 years of live engagements just to match 10 seconds on Diane’s show

(* ABC reports that for November 2011 sweeps, ABC World News with Diane Sawyer delivered 7.95 million total viewers.)

Page 199: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingInstead of Diane’s show, say you reach

1,000 influential bloggersBlogs like EQJournal.org have more than

52,000 individual IP addresses accessing it

Assume you reach 1,000 like itBy engaging blogosphere, you could

potentially deliver 52,000,000 viewers, far more than what Diane does

Page 200: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingBlogs, Twitter, FB, Digg, Reddit and

YouTube are cratering mainstream media, in part, because they are inexpensive, authentic (for the most part), democratic and non-elitist

So why go to the trouble of writing media releases at all?

Most important reason to record in a systematic and careful way the history of your event

Page 201: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingTwitter NationIn 1953, Arthur C. Clark predicted (in his

novel Childhood’s End) that by the turn of the 20th Century, long distance would cease to exist

Browser, Email, IM, My Space, Skype and others (Facebook, Twitter, LinkedIn, Google+ et al) came along around that time to make his prediction largely come true and then some

Page 202: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingTwitter, which is outward facing in a way

that its competitors are not, brings with it a level of utility beyond other social media that benefits entrepreneurs and intrapreneurs to a great degree

Communicate, two way, with the world for free

Influence your clients, customers, suppliers, colleagues, partners and sponsors in a way never possible before

Page 203: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingFB is about friends and familyTwitter is for friends, family, colleagues,

acquaintances, co-workers, direct reports and fans

Just imagine having 1,000 followers or maybe 5,000 or possibly 50,000 or even 500,000

Page 204: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingIf you change jobs, need a job, start a new

enterprise, learn something cool, participate in an event, need input on a new logo, want to run a poll on a new product or service, want to share information, feel like speaking your mind, need an apartment, want to organize a meet-up, publish a book, write a new blog post, need more clients, have to find a new supplier…you can broadcast a message that instantly seen by everyone who follows you

Page 205: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingYou can DM (Direct Message) them

privately, you can mention them publicly using the @mentions feature (recently renamed @connect), you can create lists of certain groups (like I do for my former students)

You can follow people of interest to you and see what they are doing, what they are reading or watching and learn from them

Page 206: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingYou can tailor your follow list so that it

includes news on subjects of interest to you—which might include current events or obscure subjects of interest only to a handful of people on the planet including you

Integrate Twitter into classes Answer questions like: ‘Hey Prof, when is our

essay due?’ Can tell whole class with single tweet instead

of, say, 45 emails

Page 207: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingUse hashtag feature (which the Twitter

community created)#ec3396 and #MBA6298, course codes

preceded by ‘#’ sign (which is nicknamed a hashtag)

Page 208: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingStudents can see not only answers to

mundane questions but also answers to more substantive ones

Hashtag feature allows cross-conversations to develop

Not always Prof talking to students or vice versa but students helping each other and other students jumping in

Page 209: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social Marketing@mentions (@connect), favorite and

retweet features allow you to give props to a follower or, for that matter, anyone on Twitter

If something is really important to you, you can tweet it out at different times of day

Individualize backdrop to your Twitter home page

Page 210: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingUse Twitter as a ’social’ media which

means you engage in conversations It is not a sales toolTry to answer as many @connects as you

can and all your DMsSpend about 10 minutes a day on the

service because you integrate it into your workday

Page 211: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingWhen you are meeting someone or

working on stuff and you trip over something that you think your friends, fans and followers will find interesting, add it to your Twitter feed via your smartphone app

It will take you 12 to 18 months to find your ‘voice’ on SM

So tweet at least 1/day until you get the hang of it

Page 212: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingYou can and probably will have multiple

Twitter channelsMy main account is @ProfBruce but

recently we’ve added @BootstrapAwards, @Exploriem, @BizModelComp, @Century21Expl and others

We can narrowcast with these other Twitter feeds and be more openly commercial with the latter without compromising the integrity of @ProfBruce

Page 213: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social MarketingPeople who follow @Century21Expl are

presumably folks interested in commercial real estate

So they will want to watch this feed to see if they can pick up any commercial property that suits their portfolio or budget

Or learn any ‘tricks of the trade’ so to speak

So it’s OK to be blatantly commercial here

Page 214: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social Marketing I would not buy any URL today without getting

the exact @Twitter equivalent whenever possible

Probably try to get identical Facebook page vanity URL too

So if you are buying ProfBruce.com, try to get @ProfBruce and Facebook.com/ProfBruce

You only have a few seconds to impress someone with your brand so why make it harder on everyone if you own ProfBruce.com but your twitter handle is kool_dude-1990?

Page 215: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social Marketing Twitter’s API (application programming interface)

is being adapted to add a social layer to many biz models today

If you can place your enterprise at the centre of a community tied together through the fan/friend/follow/follower model (Twitter is just one option among many you can choose from), it will be much harder to knock off or outsource and kill

It can create a sustainable competitive advantage for you

Page 216: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social Marketing Facebook comments was brilliant move to

extend FB franchise and Twitter should respond by embracing that as well

Never liked anonymous comments—they can be outrageous, libelous and untrue with no repercussions for those posting these sometimes hateful and shameful things

One thing that Twitter and FB do very well (especially FB) is verify who you are; how many people will follow you if you are a fraud?

Folks will catch on and drop away

Page 217: Negative Cost Selling/Guerrilla Marketing/Social Marketing

Guerrilla and Social Marketing There is no hard and fast rule about who you

follow Should you follow everyone who follows you? I think you should be selective because, if you

have a lot of followers, it’s hard to have a real conversation with 5,000, 50,000, 500,000 or millions of followers

But I also understand the democratic urge to follow everyone back

It’s up to you