“5 Strategies for Generating Consumer-Demand” | by: Firas Kittaneh | Entrepreneur

Generating demand for your product requires much more than simply releasing it onto the market…You need to conduct research, determine what consumers’ needs are, establish yourself as a leader in your industry and repeatedly prove your products’ worth.

Industry professionals recognize that before, during and after you introduce a new product, there is a lot of legwork to be done to pique consumers’ curiosity and get them interested.

Here are FIVE things you should be doing :

1. Pay attention to Market Research – Your company should aim to figure out what customers need and want through surveys, test groups and feedback on social media and reviews left on your website. If you notice certain issues that keep popping up, there might be a need for a new product to solve the problem.

2. Produce stellar Content – If you’re just starting out, your business should promote its new product and prove that it’s solving a problem currently plaguing consumers through informative and educational content. Determine your target demographic and do some research to find out where they are active on social media and elsewhere online. Your content should aim to entertain and inform your customers of the value of your products.

Release an explainer video that relates to your business or a humorous video they’ll want to share with friends (think Old Spice or Dollar Shave Club’s spots), an infographic that educates consumers about a pertinent issue, or a blog post written by your CEO that contains industry insights. By producing quality content on a regular basis, you’ll begin to build trust with your audience and ideally increase sales from this newly established relationship.

3. Feature Customers’ Reviews – On your website, product pages and elsewhere, you should be featuring customer reviews. Customers are going to trust testimonials from their fellow shoppers. In a survey conducted by Ipsos Open Thinking Exchange, it was found that 78 percent of American customers aged 18 to 64 who shop online, consult reviews before purchasing a product.

They won’t hesitate to purchase from your competitors if there’s a plethora of bad reviews about your products, which is why your employees should be apologetic to any customers who had negative experiences and respond quickly to any feedback that comes up. You also need to track their reviews and analyze them in order to improve products. Rating and review software such as Bazaarvoice, Re-Vu or Gigya will allow you to do just that depending on the size of your business and your budget.

4. Give New Customers a Deal – Another method to get consumers to try your products for the first time is to offer them a discounted or special rate. Initially, customers may not be willing to try out a product at full price. If it’s offered at a rate lower than your competitors’ — they just might.

Once customers have received your product and find it useful, they’ll likely be inclined to purchase from you again at the regular price. Make sure you’re clear that the deal is a one-time offer, because you don’t want customers to be discouraged when they decide to shop with you again and find your products priced differently.

5. Create an Exclusive Club – Once a person becomes a repeat customer, you’ll want to reward them and make them feel appreciated. Create an exclusive club for these loyal customers that gives them access to certain promotions, lets them in on company news and secrets before they’re released to the general public, and communicates to them that they’re part of the process of perfecting your products. Ask for their opinions and encourage them to take surveys.

Virgin Airlines offers its loyal customers a tier system where they are given more perks including discounts, expedited check in on flights and priority boarding depending upon their status. Boloco, a restaurant chain in New England, encourages customer spending where after every $50 purchase, they get a free menu item.

When attempting to generate customer demand, you have to realize that no one is going to listen until you substantiate your usefulness. Always keep the customers’ needs in mind and aim to please.

How did your company generate demand for your products or services ? We’d love to hear your effective strategies for demand generation…

“Indian Footwear Industry”; a Perspective | by: Adesh Gupta | ET Retail

“For the Indian footwear to explode and deliver, favorable government policies, infrastructure, removal of high doses of taxation, infrastructural support in capacity building, skill education and technology up gradation, brand building exercise should be initiated expeditiously no later than now”… 

India is the largest global producer of footwear after China, accounting to approx 13% of world footwear production, which is close to 16 billion pairs. This means that the average consumption globally is about 2-3 pairs/person. India produces approximate 2,000 Million pairs annually in different categories of Footwear. India exports about 115 million pairs, thus nearly 95% of its produce meets its own domestic demand.

With an estimated global population of 7-8 billion, India constitutes a share of approx 15%, which means 1.2 to 1.3 billion feet needs to be covered from heat, cold, injuries, protection etc. Footwear sector is a very significant segment of Leather and Non Leather products in India.

Size of Indian Domestic Footwear Industry is estimated to be worth 20-25,000 crores where leather and non-leather Footwear per capita consumption is estimated to be approx 1.1 pairs. In addition to this, Slippers (Hawai Chappals)segment is close to 10000 crores with per capita consumption are estimated to be 1 pair.

Our immediate Asian Neighbors reflect good per capita consumption between 3-4 pairs, whereas the developed nations such as US, EU, UK etc. enviably enjoy a far better per capita of 7 to 8 pairs.

The challenge for Indian Footwear Industry is lit large but anticipating India to become amongst top 5 Superpowers in 2030, our consumption rates can reach as high as 7-8 Pairs. In such a scenario, India would need to produce anywhere between 8-10 billion pairs consider yearly population growth.

Consolidating mid-term status by 2020, the potential target for Indian Footwear Industry will equalize consumption pattern of 3-4 pairs. With six/seven years to go, we need to scale our production from current level of 2 billion pairs to nearly 5 billion pairs at a CAGR rate of 30-40%.

Favorably for us, India ranks No.1 in milk production & we have the largest resource of cattle population in the world. Additionally, on the strength of raw material available domestically, the large pool of skilled and unskilled manpower, we have all the capability to take this challenge head on.

Given this backdrop of homogeneous potential it would not be an exaggeration to say that Footwear Sector is today, on engine of incremental growth. With global integration of Indian Industry, rapid change in lifestyle, income growth at bottom of the wealth pyramid, Footwear industry is expected to grow leaps and bounds.

Sadly, overall industrial growth remains moderate and is struggling to take off due to lingering on infrastructural constraints. For the Indian footwear to explode and deliver, favorable government policies, infrastructure, removal of high doses of taxation, infrastructural support in capacity building, skill education and technology up gradation, brand building exercise should be initiated expeditiously no later than now.

“Key-provisions in Draft-Guidelines” on “Real Estate Investment Trust’s (REITs) in India & KPMG’s point of view” | Realty Plus

Securities and Exchange Commission of India (SEBI) recently released Draft-Guidelines on Real Estate Investment Trust (REITs). In a recent significant move, the Reserve Bank of India (RBI) have cleared the decks favouring changes in the Foreign Exchange Management Act (FEMA) and Foreign Direct Investment rules, as sought by SEBI. Further SEBI has asked for ‘pass through’ status approval from Income Tax department and is awaiting the approval from Ministry of Finance.

Key provisions of the Draft-Regulations :

• REITs shall be set up as a trust and shall not launch any schemes and should have a minimum asset size of INR10,000 million (INR1,000 crore) for offering the units to the public.

• REITs should come out with an initial offer within 18 months of registration with SEBI and it would be mandatory to list all units of REITs after the initial offer.

• The Initial Offer size should be of INR2,500 million (INR250 crore) and the minimum public float should be 25 per cent of the value of the REITs.

• The Sponsor should hold at least 25 per cent of the total units of the REITs prior to the initial offer, and a minimum holding of 25 per cent of the Sponsor will be locked in for three years from the date of listing and the balance holding will be locked in for one year. Further, the Sponsor should hold at least 15 per cent of the outstanding units of the REITs at all times (which can be transferred, subject to specified conditions).

• The Manager should have minimum net worth of INR50 million (INR5 crore) and should have at least five years of specified relevant experience.

• REITs may raise funds from any investor, whether resident or foreign (subject to guidelines specified by the RBI and the Government). However, initially, till the market develops, it is proposed that the units of the REITs may be offered only to HNIs/ institutions and therefore, it is proposed that the minimum subscription size shall be INR2 lakh per investor and the unit size shall be INR ONE lakh.

• Investment by an REIT shall only be in properties or securities in India :

1. At least 90 per cent of the value of REITs assets shall be in completed (i.e. occupancy certificate received) and rent generating properties (i.e. 75 percent rented/leased out). 

2. Balance can be invested in the specified assets [like developmental properties, listed or unlisted debt, mortgage backed securities (MBS), equity shares of real estate companies, government securities or money market instruments, etc., subject to specified conditions]. 

• REITs will not be permitted to invest in vacant land or agricultural land or mortgages (other than MBS).

• REITs are permitted to invest in properties through Special Purpose Vehicles (SPV), if SPV holds at least 90 per cent of their assets directly in specified real estate properties and REIT has control over the SPV.

• REITs are permitted to invest the entire corpus in one project but a REITs cannot undertake investment in other REITs.

• At least 75 percent of the revenues of REITs (other than gains arising from disposal of properties) shall be from rental, leasing and letting real estate assets at all times.

• In case of co-investment with any person, few conditions are specified which, inter-alia, includes that investment by other person shall not be at terms more favourable than those of REITs.

• At least 90 per cent of net distributable income after tax of the REITs should be distributed to the unit holders.

• Aggregate consolidated borrowings and deferred payments of the REITs have been capped at 50 per cent of the value of the REITs assets and where the same exceeds 25 per cent of the REITs assets, credit rating from SEBI registered credit rating agency and approval of unit holders would be required.

• Full valuation, including physical inspection of the properties, should be carried out at least once a year (with every six monthly up-dation in the valuation). 

• For any purchase of a new property or sale of an existing property, full valuation should be undertaken, and the transaction shall not be less than 90 per cent/or not more than 110 per cent of the assessed value of the property for sale/purchase of assets respectively.

• All unit holders of the REITs shall enjoy equal voting rights.

• Stringent conditions have been imposed on related party transactions including detailed disclosures, valuation requirements and investor approval.

• Voluntary winding up as well as mandatory winding up in certain circumstances like public float going below the minimum the threshold of 25 percent have been prescribed.

KPMG in India, point-of-view over Draft Guidelines on REITs :

There is no denying that the introduction of REITs would help the real estate sector in India significantly. There has been considerable development of real estate, especially in Tier-1 cities, in the form of quality office spaces and shopping malls with long-term lease arrangements. The introduction of REITs would provide huge potential to monetize such assets and also help retail investors participate in such long-term income-yielding assets. The concept as a whole would be a win-win situation for both investors and developers and it would also address, to a large extent, the liquidity crisis in the sector.

As discussed, residential assets are self-liquidating, so there is no capital locked in such development projects for a long duration. However, huge capital is locked in leased assets and REIT would help monetise such capital values, which can then be used for further development. If the REIT regulations are enacted as proposed — and are regularly monitored to uphold investors’ confidence — they can go a long way toward addressing the liquidity crisis in the sector.

The concept of REIT would not only help developers in the commercial property space, but can change the overall dynamics of allied sectors like hospitals, hotels, schools and old age homes, as they would help build an asset class that can be used for operations by these allied sectors, which currently faces challenges due to capital commitments involved in developing and operating such assets.

Thus, REIT is essential for India, which is witnessing significant development of large tracts of leased assets. However, it is important that adequate regulations are kept in place to ensure adequate valuation, restrict speculations and maintain investors’ confidence.

Key aspects to be considered : 

It is important to properly implement regulations to ensure smooth transition of assets by the developer community to REITs. Consequently, based on our review of the draft regulations, following aspects require clarity: 

Operational Aspects of REIT’s : 

• Current regulations require a REIT to have an asset base of INR10,000 million (INR1,000 crore) before it is listed. The said amount is a big commitment given that the REIT is a new concept in India and there may be associated risks involved in its acceptability when offered to the public. Accordingly, REITs shall be allowed to go for IPOs based on with a lower threshold and a commitment from the Sponsor to increase the total assets size of the fund to INR10,000 million (INR1,000 crore) within the prescribed time line].

• REITs are allowed to invest only in securities or properties in India. The term “Securities” is defined under section 2(h) of Securities Contracts (Regulation) Act, 1956 [‘SCRA’] which mean marketable securities. Partnership interests and shares of a private limited company do not get covered under definition of securities under section 2(h) of SCRA. REIT should also be allowed to invest in partnership interest and shares of a private limited company.

• REITS can make investment/s through SPVs which are defined to mean only body corporate as defined under the Companies Act, 2013. Considering that many of the real estate projects would be housed in Limited Liability Partnerships (LLP), REIT should also be allowed to invest in a LLP/s.

• Only 10 per cent of value of REIT assets is allowed to be invested in residual category which includes under developed property which shall be held by REIT for at least three years after completion and is required to be leased out. Under 10 per cent residual category, TDRs/FSI/Vacant Land forming part of overall property and un-leased building should also be allowed which are acquired for future development purpose.

• The Sponsor is required to have at least five years of experience in the real estate industry on an individual basis. This requirement needs to be removed considering that REIT model could be explored by logistics park owners, hospitality sector, healthcare sector, etc.

• Definition of Manager means a company as defined under the Companies Act 2013 which manages assets and investments of REIT. Since the LLP structure is prevalent and more popular, allowing LLP to be appointed as Manager will immensely benefit the Managers to organise their affairs in a more tax efficient manner.

• Failure to maintain minimum public float below 25 per cent mandates a trustee to apply for delisting of REIT. There is no cure period provided within which the Sponsor could divest its shareholding to bring up the minimum public shareholding. Cure period of say one year should be provided for.

Amendment required in Income-tax, FEMA and Stamp Duty Law : 

• Current regulations allow a REIT to invest in SPVs subject to the latters’ meeting the specified criteria. However, if a REIT invests through a SPV, the same may result in double taxation, first in the hands of the SPV and then again there would be additional tax when such funds are repatriated by the SPV. Accordingly, it may be desirable to bring taxation under both the models, i.e. where a REIT directly holds a property vis-à-vis where the REIT holds the property through a SPV, at par, by allowing a complete pass through for tax purposes where the REIT invests through a SPV.

• Current FEMA regulations would need to be adequately amended to allow simpler investment route for foreign investors investing in REIT. As per recent article, the RBI is set to give a nod to SEBI’s proposal favouring changes in FEMA and Foreign Direct Investment rules.

• Given that a REIT is required to invest at least 90 per cent of the corpus into completed and rent-generating property, setting up of REIT may entail transfer of immovable property either to the REIT or its SPVs to meet specified conditions. Current regulations would entail stamp duty and capital gain tax on such transfer. Thus, it may be prudent to exempt specific stamp duty and capital gain tax for immovable property transferred to REIT to make it more competitive.

• Current laws provide tax exemption on the sale of listed equity shares (in case it is long term). Thus, it may be advisable to introduce provisions to bring listed units of REIT on par with listed equity shares.

Watch out for “Watch” Retail:a niche-category increasing its consumer-base | Indian Retailer

“With 27% penetration in India, manufacturers & retailers of Watch Brands, across the spectrum (value to Luxury)..have great hope to increase the consumer base through organized outlets. Watch Industry hopes to penetrate through organised stores”..

Introduction:

With aesthetic and elegance having taken over durability and necessity, the watch Industry has witnessed drastic change not only in consumer pattern but also in the product-line and designs.

The watch Industry is no longer dominated by a fist full public sector organisations like Hindustan Machine Tools Ltd (HMT) and Allwyn that ruled in late 1960s, and then taken over by Titan in 1980s and Maxima in 90s.  Post liberalisation (1991), watch industry saw hosts of manufacturers and a variety of national, international brands making their way to the country.

The article explores what lies in store for the watch Industry, major retail players and what are the opportunities available for retailer along with price investment plans.

Size, Major players in the market : 

The Indian watch market is burgeoning, related to size, new product lines, growing number of players etc. giving cutting edge competition at every price segment. In 3500 crores watch market, there are 46 million (17 million organized and 29 million unorganized) number of pieces available in the country. With 27% meager penetration of watches in India, Titan is the dominant player of the market having 65% of impressive share in the organised sector (11 million). Other significant national & international players are Maxima, Timex (US player– 12 brands including Timex, Versace, Nautica and Guess, spanning a wide price spectrum – from Rs 600 to a few lakh rupees) Citizen etc. constitute the rest 6 million pieces.

This huge market, growing annually around 11-12%, has variety of watches from budget segment to fashion-oriented to premium to cater to the need of every segment in the society. About 24% of values sales come from the sub-brands of Rs 500 segment watches.

  • The budget category – includes Titan Sonata, Maxima : Rs. 295- 1500 (15-34 years)), SSTEELE- Rs. 1250-3500/- (18-24 years), Timex brand (Rs 995 onwards).
  • Youth oriented category – Fastrack (Titan), Timex has loyal consumers in youth), Maxima’s ATTIVO collection for youth & teenagers, Timex’s fashion brand Marc Ecko (Rs 5000-13000), Tommy Hilfiger, GAP, Guess etc .
  • Medium category – Timex’s Nautica (Rs 7000-20000), Marc Ecko (Rs 5000- 13000), Titan brand
  • Mid & Premium category – Swatch Groups’s Rado (Rs 40000 onwards), Longines, Omega (women premium Rs 80000 onwards), Cartier (1.2 lakhs), Rolex, Breguet (one of the most expensive watch brand), Titan Raga (sub-brand from Titan for women), Titan’s Xylys etc.

Retail Spread & Investment Opportunities :

Mainly spread in the format of MBOs, kiosks, shop-in-shop and unorganized market, the industry still needs more exclusive stores and upgraded retail environment; though the products are distributed in departmental stores like Pantaloons, Big Bazaars etc. giving ample opportunities to the distributors and retailers to make their earnings from this sector, the market still needs to be more organized.

Titan which came in 80s and completely wiped out the mechanical watches from HMT and Allwyn, also discovered that the quality of watch stores needed a major facelift and created its first watch show room in Bangalore by Dec 1987. The chain then expanded through franchised stores. “With the space area of 1500 sq ft and investment of 50  lakhs onwards, 95% of the chain stores of Titan are operated through ‘World of Titan’ Outlet franchises, “said Mr Govindraj V, VP-Integrated Retail Services at Titan Industries Ltd.

On similar pattern, Timex Group (subsidiary of US Company) also retails through all retail formats. The company lays main emphasis on displaying multi-brands rather than mono brand. Code named as ‘Time Factory outlet’ store (currently 72 own outlets) displays around 6-8 other brands (in-house & outhouse) other than anchor brand for better choice for customers in retail outlets.The store requires 300-400 sq ft area with an investment of 8-10 lakhs on interiors and 15-20 lakhs on the stock.

The company is seriously looking for retail expansion of around $1 million and targets to double its own outlets in the next two years. As asserted by Mr VD Wadhwa, MD,Timex India, “ Roughly about 40 per cent of the expansion would be through the kiosk format because of the high cost of retail property, particularly in malls. A maximum of 100-120 sq ft is good enough for a product like ours. Also, it is economical with regard to cost of funding, low regulating operations and simultaneously performing at par with any other standalone store displaying ample of watches in kiosk store.” The company is planning to bring 400 to 500 such kiosk stores with an investment cost around 10-12 lakhs only in kiosk franchise model.

Tier II & III cities: Immense potential for expansions : 

Watch companies are looking at these regions with great interest to tap the customers in budget segment precisely. Anticipating immense potential, retail formats would remain same with smaller store coverage.

Maxima ( still not into franchising) a value for money segment brand, finds great future in these cities and town between price points of Rs 350-600 range.

“For a starter, an area of around 40-50 sq ft and having an investment stock of Rs 25000, with a detail understanding of the market is minimum requirement to enter into the business,” opines Mr Govind Mishra, Marketing Head, Maxima India with minimum 50 pieces (70% display & 30% back-end stock).

“Commitment to retailing and sharing our values are as important as the availability of retail space and the capacity to invest in stocks and interiors of the stores,” says Mr Govindraj V. Titan has recently launched its flagship store named ‘Titan One’ with 600 sq ft coverage for tier III towns and cities. Around 1,250 watches would be displayed which would include the latest collections such as Titan Tycoon, Raga Flora, Titan Octane, Sonata Superfibre and Fastrack Army, ranging from Rs 275 to Rs 17,000 with an investment cost (including interiors) of Rs 15-25 lakh on the store.

Premium Brands Market & Budget Plans : 

The market is meager for the Premium Brands with main international players from Swatch Group (17 brands-Longines, Tissot, Rado, CK etc) and LVMH Moët Hennessy Louis Vuitton, the world’s leading luxury group (5 brands-Dior, Zenith etc), Titan’s Xylys have its own premium market; The segment’s active consumer being ladies splurge on them as brand statement.

The market for this segment is growing at a decent pace but they are still looking for high luxury locations. The basic investment requirement for Premium range watches starts from Rs 2 crores for mono-brand (Omega) to Rs 8-10 crores for multi-brand watches along with interior costs.

Conclusion : 

Though mobile phones have become the substitute for watches clocking the penetration to only 27 %, still Indian watch market is growing at high speed bringing hosts of opportunities for all the segments equally. There are oodles of innovations, better watch-portfolios with quality and price ranges and enhanced selling outlets to increase consumer base at large.

Retail “Concept” store : Brands are exploring this retail-format for “increased consumer-engagement” | Indian Retailer

Lately, we have seen many “Retail Concept Stores” marking their presence in the Indian retail space. To name few, brands like Peter England, Celio, Reebok and Nike have experimented with this retail format in the last couple of months.

In fact, Nike has announced to put focus on concept-based stores for future in a bid to strengthen its position. So the question arises, why there is sudden rush for concept stores. Concept stores are emerging as new catchment area that retailers wish to explore up to the hilt.

But, before we proceed further we need to understand what concept stores are all about : 

What is “Concept Store” ?

A concept store is a unique way of communicating the brand’s take on consumer lifestyle directly with the consumer. It’s astore that goes beyond simply selling products. Elaborating this format, COO, Peter England, says, “Many of the brand stores are opened keeping in mind the right market catchment and other business dynamics. While a Concept-Store is opened purely keeping in mind what the brand wants to communicate with the consumer and in what manner.”

Peter England has just come up with its ‘Generation Store’ at Jaipur. The concept store aims to help the young professionals with apparel that is designed to take care of his/her needs.

Reiterating the same Brand Director, Reebok India, says , “A concept store is one that goes beyond the basic selling of products, and instead focuses on appealing to a particular segment of the market or a category of consumers that follows a particular lifestyle.”

He highlighted that these stores aim at offering a complete experience to their consumers, and give them a sense of the lifestyle theme that they are centered around. Fit Hub is the concept store initiated by Reebok.

Flagship versus Concept-Store :

Apshankar highlighted that there is no preference among the two. Both these formats have their own purpose.

A concept-store aims to go beyond a simple ‘consumer-brand transaction’ to a ‘consumer-brand interaction.” On the other hand, for a flagship store, the prominence of location, volume and value growths, profitability and latest merchandise offering and mix are a priority.

Mall or High-Street :

As per market experts, usually high-street locations are considered to have an edge over the mall locations for a concept-store. This is because, a mall store usually restricts the level of customisation and changes that can be done in a store area to build a concept-store. In addition, investment per square foot is also higher in a mall store.

Addressing the same, Basu says, “Both locations have their own advantages and disadvantages, and the decision to choose either one depends on a variety of factors.”

At one hand, a mall offers various retail solutions under roof, which ultimately results in time and money saving. On the downside, some of the malls in the country lack efficient management systems, which imply an increase in retailer’s cost of maintenance, considerably high rental costs, and a poorly-thought-of tenant mix.

High-street locations offer greater space, and the option of customisation to a higher extent. Such locations are great for flagship stores. They also give consumers a more personalised experience, and hence attract the right kind of shoppers that enter a particular store with the intent to make a purchase of their products.

In a media interaction, Nike India Marketing Director said, “Nike India is exploring options of setting up concept-based stores in the country to garner more share in the domestic sportswear industry valued at Rs 3,500 crore.” Likewise, Reebok, which has 50 Fit Hub stores in India, has plans to have 100 Fit Hub stores by April 2014.

” 7 Steps” to Put Your “Customer-Community” to “Work for your Business” | by: Scott Hirsch| SalesForce

“A customer-community is a vital catalyst for businesses that want to differentiate based on customer – experience”…

Vibrant communities create collaborative partnerships with customers, providing first-hand insight into their wants and needs, while simultaneously elevating the level of accountability that departments and individual employees have regarding the quality of customer service and experience.

But thriving communities don’t just happen on their own—they need to be set up, moderated and cultivated internally. Successful customer communities require equal parts art—cultivating conversations and engaging community members—and science—a data-driven, analytical approach to understanding the community in order to grow engagement, manage participation, assess content effectiveness and gauge impact on customers.

So, how do you organize internal processes and prepare employees to put your customer community to work for you..

Here are SEVEN Steps that will get you on the right path to success :

1. Go where your customers are:

Don’t make customers and prospects find you, be present where your customers and prospects spend their time. Today’s tech-savvy customers and prospects look for information about companies and their products in many places: your website, on Google, and in social media. By posting links to relevant community conversations across social channels, companies can improve customer engagement and capture the attention of new prospects. The more community doors you can open for your customers and prospects, the better. You can simplify this process by choosing a community platform that stays on top of consumer trends and makes it easy to integrate your community with existing channels.

2. Leverage the power of search engines:

Because your customers are generating the bulk of the content, you will benefit from the volume and long-tail nature of conversations in the community. In addition, search algorithms give preference to user-generated content. As a result, your community will produce some of the highest ranked SEO content on your site. The SEO juice your customer community will generate will filter up to your homepage, helping your company’s website rank higher in search results pages over time. However, some community platforms will rank better in Google than others. Here are some rules of thumb:

  • Choose a platform that creates a URL structure that includes your brand name and the words of the customer in the title
  • Add your own keywords and tags so they’re easy to index
  • A good platform will have a large body of content so that your company will benefit. For example, Get Satisfaction hosts more than 10 million pages that are crawled by search engines several times an hour. This sheer size of the platform makes it a magnet for search.

3. Go mobile (Social):

We’re shifting from a desktop to mobile-centric world. Customers and prospects are constantly on the go—traveling to work, attending offsite meetings or engaging in a range of other activities that don’t involve sitting in front of a computer. Today’s customers are increasingly likely to be browsing the Internet and searching for information on their cellphones and tablets rather than on their PCs. If you haven’t already implemented a mobile strategy, you’re likely missing a large percentage of prospects and potential customers. But providing an optimized mobile experience doesn’t only mean offering a mobile app, it requires optimizing your browser-based experience for all screen sizes, regardless of device or operating system. Be sure to select a community platform that uses responsive design elements so your customers can get an optimized view of the community no matter where or how they are access it from.

4. Seed your community with quality content:

You probably know the common questions and issues that your support team receives. So as you launch your community—and then on an ongoing basis–post content that addresses these same questions. Seed answers to your FAQs right off the bat as conversations, so they’ll be available when your first customers come looking for them. It’s also important to periodically post topics and ask questions of your community that will generate ideas and drive engagement, such as asking for feedback on future products. The insight you gain is coming from your customers and prospects. This is even more valuable than insights from a focus group because it’s directly from the people who are already interested in and buying your products. Realize that all content is not evergreen. Tend to your community like a gardener by seeding it with helpful content, weeding out outdated or irrelevant information, and cross-pollinating it with links to and from other places.

5. Monitor participation and cultivate advocates:

Monitor participation and identify power users and advocates to help build a thriving community. There are three key ways to accomplish this:

  1. Identify the people in your community who are most vocal, knowledgeable and helpful. These are your champions, and they might be in your branded community, as well as in your greater social media and customer community.
  2. Reach out with questions to encourage engagement between customers. Guidance from community managers can unlock the goodwill of your best advocates. You just have to ask.
  3. Treat your champions to perks. For example, host them in your office or at an event or give them exclusive access to new products before they launch. Most champions are highly motivated by these non-monetary incentives and appreciate the connection with the company.

 6. Know when to get out of the way:

Sometimes when customer questions are raised in your community or in another social channel, you have to step back and let your community members and customer champions take over. By designating a specific wait period before responding, and even reaching out to specific champions to see if they want to respond, you train and empower your community members to step up. This gives your community members—especially your more committed, active advocates—a sense of purpose and it allows you to get more value from your community.

7. Understand the health of your community:

It’s important to track key statistics such as total number of visitors, revisits, users, new users, active users, community page views, topic page views, new topics and new topics with replies. Indicators of a healthy and thriving community are highly dependent on your overall community strategy. For example, a B2B company with a sophisticated lead nurturing program may want to assess the depth and quality of community conversations, while a B2C company that serves millions of customers may be more interested in tracking the breadth of engagement.

Communities break down silos within companies, and departments across the enterprise begin collaborating and working together to address customer issues and analyze customer feedback.

The result is that the entire organization begins to “work together with a unified goal of creating an experience that fosters a Loyal customer-base”..

The “80/20 Rule of Sales”: How to “Find Your Best Customers”| by: Perry Marshall | Entrepreneur

It is an old business adage : About 20 % of your customers produce 80 % of your sales. In my book  80/20 Sales & Marketing, I argue that this 80/20 principle also applies to time management, search engine marketing and far more.

The funny thing is that even with sales, business-owners often ignore the 80/20 rule…We’re all tempted to waste our time trying to please all of our customers instead of the most lucrative ones…We are all conditioned to always respond to the stimulus around us. So if you obey the 80/20 rule, you are going always to feel as though you are ignoring something — because you are.

It will be an irritating feeling at first. And it particularly gnaws at Americans because we are prone to trying to treat people equally. The phrase is clearly written our Declaration of Independence, that all people “are created equal.”

But all customers are not equal. Far from it. Some earn you an amazingly disproportionate amount of money, many make you a little bit of money, and some even waste your time. With the last group, you lose money selling anything to them at all.

Your goal should be to zero-in on those 20 % of customers who are essential for your business’ prosperity..

Here are some tips on how to do just that :

1. Mine your customer lists – Maybe it’s your email distribution list or your company’s Facebook following. But I still find it amazing how many businesses don’t bother to look up sales data on the customers. Apply the R-F-M rule: Check which customers on your list bought most Recently, bought more Frequently, and spent the most Money. Bingo. You’ve found a chunk of your 20 percent. Focus on them. Send them nicer Christmas gifts. Send them a postcard when you’re on vacation.

2. Study your geography – Delve into your point of sale systems and find out where your money-making customers actually live. You can do it really bonehead simple with thumbtacks on a map if you want; or you can do a detailed study. Either way, odds are people or businesses from certain neighborhoods or certain cities are providing most of your business. For example, I know that most of my business consulting customers come from suburbs of technically advanced markets such as San Francisco, Dallas and Washington, D.C. This is important knowledge because you can save money on Internet advertising and other forms of marketing by narrowing it to specific geographies.

3. Find your customer niches – The customers who buy the most expensive products or services almost always fit a peculiar demographic. They are noticeably different than everyone else. Stay open-minded as you figure this out, too. For example, I have a client who provides publicity for authors. Overwhelmingly, his hottest buyers are middle-aged divorced women. Many are rebounding from failed marriages and feel compelled to do something significant — like write a book. My advice to my friend is to subtly take advantage of this insight by publishing customer endorsements where the authors mention similar struggles. People who’ve experienced that pain can’t not notice. Those stories naturally attract similar authors to the business.

4. Fire your problem customers – Inevitably, there is another 10-20 percent of customers who rack up support tickets and chew up phone time, and take away from you servicing your most lucrative 20 percent. If you’ve tried to fit a square peg into a round hole too many times with them, just stop. I’ve done that. I’ve said to customers, ‘I should not be consulting for you anymore.’ I’ve occasionally even blacklisted customers — or at least made a point to ignore them until they go away. Be polite and gracious about it, because you don’t want a bad online review. But still do it.

5. Pinpoint your “Silent High-Volume Buyers” – Almost all businesses have a few of them — especially in B-to-B companies. They send in a purchase order every two months, and it’s usually a nice fat one. They truly are your highest-return customers. They require so little maintenance that you don’t even notice they’re there most of the time. Instead, you’re chewing up time on the phone with the squeaky wheel guy who actually costs you more money to service than he makes you. Ignore the problem customers, and direct your time towards relationships with the hassle-free, big spenders. Take them out to lunch. You’ll most certainly find there’s a product or service you have that they don’t know about.

It is so natural to want to pay attention to all of your customers. But you don’t need everyone — far from it..

Paddle away from the 20 percent of your customers who cause problems, and focus on the 20 percent who buy the most from you.