A Tale Of Two Widget Salesmen

Many people see sales as an exercise in confrontation. If you’ve ever bought a high ticket item like a car, then you know what I’m talking about. You want to get a cheap price, and the seller wants to make as much money as possible. For the most part, the difficulties in buying and selling aren’t centered around the price, they’re centered around the transaction itself.

Consider somebody who is selling widgets at a booth. Say the booth is at a home show. For every widget he sells, he’ll make a profit of a dollar. Naturally, the more widgets he sells, the more money he takes. If he had his druthers, he’d sell a widget to everybody that passed him by. This is precisely what he tries to do.

He comes up with a huge pitch, designed to lure in as many people as possible. He claims this widget can do anything, so more people will want it. Because he is so good a persuasion, or sales, a lot of people are convinced they want this widget. They get it home, still feeling happy that they’ve bought this widget.

But a few days and weeks pass, and they find they really don’t have much use for this widget. After a while, they wonder why they bought the thing. Soon their friends start asking them why they bought it. They don’t know. They say they were conned into buying it. The salesperson was really pushy. They bought it just to be polite.

Pretty soon this widget seller has developed a reputation as a pushy salesperson. He has to travel to a new city every couple months, because he quickly wears out his welcome. Such is the life of a traveling widget salesman.

Now consider another widget salesman. He doesn’t promise the moon. He just says what the widget does. His reputation is more important to him than anything. Instead of trying to sell his widget to every single person that walks by, he qualifies his customers. He asks them questions to make sure they can get a real use out of the widget. Plenty of people like the widget, think it looks cool, but the widget salesman is clear that they really won’t get much use out of it, unless they really do need it.

So a lot fewer people buy his widgets. But the ones that do, really use it. And enjoy it. And tell all their friends. Pretty soon people that really need this widget are beating down this poor widget salesman’s door trying to buy his product.

Before long, he’s got a huge mail order business, and he doesn’t have to do any more traveling to sell his widgets. He can relax at home, while his business runs itself. He out-sources all the people he needs to handle his orders.

The first widget salesman was worried about not selling anything, and thus created a life of hardship. The second widget salesman was convinced of the quality of his product, and in the interest of his reputation, only wanted to put it in the hands of people who really needed it. As a result, he lives and easy life with easy money.

Which one are you?

The Guppy Tank – Assessment of the Real Small Business

I must admit that I proudly proclaim that I don’t watch reality shows. However, that’s not really true. I am an avid follower of ABC’s “Shark Tank” series. The question is why, and what do I learn from that show that can be applied to my business?

While we all strive for the multi-million dollar or even billion dollar business, the truth is that most of us would be happy to have a small business that satisfies our needs – both in terms of income and satisfaction. We will likely not develop a business in which Mark Cuban would want to invest. So let’s take a look at our business interests as they might be evaluated by smaller investors in the “Guppy Tank”.

A small business, by my definition, is a business that often starts from scratch, employs the owners, perhaps some family members, and a few others. Initially, at least, the business struggles with sales and is faced with at least some periods of negative cash flow. This, of course, differs from the definition of a small business that might include 50 workers and have five million dollars in sales. With this definition in mind, let’s follow a hypothetical business into the “Guppy Tank”.

Our show opens with the introduction of three possible investors. Each has had some level of small business success of his/her own. They represent hard work, good planning, and the recognition that not all small business owners will get to this point.

Next, in comes the owner of business “X” which designs, manufactures, markets, and sells widgets. The widgets could be a consumer product or service. It really doesn’t matter. The owner of business “X” introduces his or her widgets with some fanfare. He or she explains why business “X’s” widget is so much better than any other widget out there and why it occupies a unique niche in the developing market. Everyone is properly impressed at this point.

Our guppies, however, know nothing about the widget or business “X” or the person or persons behind it. The questions begin.

Guppy 1 asks how business “X’s” founder and owner, whom we’ll call Sandy, got into this business. The question, of course, is intended to find out more about Sandy. What is Sandy’s background? Does Sandy have prior business experience? Is Sandy committed to this business? Where did the idea for the widget come from?

Guppy 2 asks questions about the widget and its current acceptance in the market. Is the item selling now? What is the market? What do we really know about the market? How did Sandy form her projections?

Guppy 3’s inquiry is focused on the financial needs of business “X”. What is needed now? What will those dollars accomplish? What will future needs be? And, of course, what’s in it for the guppy that invests.

In our show, the guppies get their answers, are impressed with the widget, with Sandy, and with the future prospects. They fight over investing in business “X” and Sandy. Sandy has succeeded. But how?

Sandy demonstrated by her answers to Guppy 1 that she is passionate about her small business. She has always been willing to work long and sometimes stressful hours because she enjoys the enterprise. She sacrifices for her business. Her widget came about from a combination of prior experience and a love for the product or service. The business provides Sandy with more than a job. It is her vocation and hobby rolled into one. Hard work – yes. Time consuming – yes. She says “Bring it on!!”

To Guppy 2 Sandy presents some data about the product and market. The guppies and Sandy know that the data was less than stellar since there was no practical way to do a full-blown analysis. But it was clear that Sandy had thought this through. She had tested the market as best she could. The results were more than encouraging. Sandy is the expert when it comes to her widget and it shows.

And as for Guppy 3’s focus, Sandy presented a picture in sufficient detail as to how the funds would be used, how they would increase sales, and how profits would benefit. Sandy had done her homework.

As the show comes to an end, we are very happy for Sandy’s success and can’t help but wonder “how would I have done” in the Guppy Tank.

The lessons from the tank are simple. In order to achieve success, we have to be passionate about our business. We must understand our market. The ultimate bases for decision making in any business, cash flow and profit, must be no strangers to our thinking. Planning is essential. And we have to understand and keep within our available resources.

But we knew all of that, didn’t we?

What is a Widget?

A widget (also known as a gadget) is a small program that runs on your desktop all the time, which replaces the need to constantly visit a website in order to get common information. A Gmail widget on someone’s desktop that shows “10 unread messages” will make that user click and go back to the Gmail website. Microsoft (Charts), AOL (Charts), Yahoo (Charts), and even Nokia (Charts) also are some famous brands that offer widgets.

If we look back the age of Widgets, they actually began with an application called Konfabulator. Designed for Mac users, it would pull information from across the Web – weather, stock quotes, headlines – and place them on the desktop as tiny floating windows. The idea was so successful that Apple decided to build widget support right into its operating system. Yahoo bought Konfabulator’s creator, Pixoria, in July 2005 for an undisclosed amount that was rumored to be decent – big enough, anyway, to get a lot of developer attention. And suddenly everyone was going mad for widgets.

Of course, the main reason widgets are hot is that users love them. The reason for the same is because it makes the Web user-programmable. If My Yahoo spread it all over, Netvibes took this idea even further by offering the users more than 250 widgets to build a wholly personalized homepage.

I don’t see it ending either. As companies like Salesforce.com (Charts) and Google (Charts) are pushing the use of widgets inside businesses. We can see the opportunities and business models around widgets are emerging and will go a long way.

How can Widgets help expand your Online Business?

Today’s Internet web space is extremely competitive, as vendors and users demand efficient use of desktop. With websites being more proactive in nature, they want to drive more targeted traffic and develop more incoming links. Widgets seem to be the answer to assist in doing this. These Internet “widgets or gadgets” are an excellent way to market your product or service and make it easily stand out. If you place a widget on your blog or webpage, visitors will instantly be able to download your specialized widget onto their desktop or add them on their blog via small html codes. One of the biggest advantages of using widgets is that they are viral in nature. They allow anyone who has your widget on their website to to share and download your widget directly through their site.

FaceBook, the gigantic social networking site for example, revolutionized their interactivity and popularity by recently introducing and adding the Facebook Platform in May/07. Now Facebook widgets are the rage. You will find everything from entertainment and sporting campaigns to different political groups based all on widgets. Because of the popularization of widgets, Facebook has managed to exponentially attract millions of new members and a lot more advertisers. Other sites that have used widgets to promote and viralize themselves include: MySpace, Revver, PhotoBucket and Blogrush. Savvy internet marketer are increasingly jumping on the widget bandwagon and using it for their benefit.

After a lot of buzz about OpenSocial, Netvibes decided to include all their existing Social APIs as plugins for UWA, their Universal Widget API. They intend to share 2 cool videos demonstrating some of the social features in their next release called “Ginger”. The videos provide examples of how Netvibes allows users to follow content and widgets that their friends want to share with them. One can also see some examples of social widgets created using the Social APIs.

Honda’s Acura RDX uses the Yahoo! Widgets application to deliver real-time traffic updates directly to drivers’ desktops in more than 30 cities. Honda promoted the feature to users who checked traffic on Yahoo! Maps and Yahoo! Widgets (where users can download existing widgets or create their own.) A key benefit was the traffic widget tying into RDX’s navigation system, which includes traffic data. The widget has been downloaded more than 30,000 times in three months.

These mini Web application downloaded onto a desktop or transported into personal Web pages, blogs or social-network profiles are a source of constantly updated information, from weather and sports scores to personal photos, which can eliminate the need to visit multiple Web sites.

So as long as you keep your widget informative, useful and simple to understand, they will virally drive traffic to your sites and work as a secret ninja to promote your products or services. Widgets are inexpensive and are an extremely effective way to promote your site through direct response marketing and social networking sites.

Widgets are certainly making a rise from desktop to webpages, blogs and social networks giving them a platform. They are now much, much more, and it seems every company has one. The hope is to embed their widget on the millions of blogs, MySpace and Facebook pages, and thus create cheap marketing while giving the users some value.

It’s a great strategy, at least when the widget is cool and people adopt it. The only question is, is your marketing firm aware of it. Do they know how to add value to the users and build an army of brand evangelists in promoting your product? Do they make effective use of Widgets?