Greater than Expectations – A Start-Up’s Success Story

This blog entry first appeared on openforum.com, American Express OPEN's award-winning site providing insights, advice and connections for small business owners. You can find more articles and updates at http://www.openforum.com/

You can also follow me on Twitter at @jasonrudman, or follow OPEN Forum @openforum. This post was written in collaboration with Courtney Colwell at Federated Media.
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The “business” of starting a business is not for the faint of heart, and my recent discussion with Melody Medina illustrates both the challenges – and the payoff – to be had from bringing your entrepreneurial aspirations to life.

Melody’s first comment to me was, “Do a gut check.” This piece of start-up advice embodies her story. Having contemplated starting her own business for years, Melody left an executive position with a prominent advertising firm in 2008 to found Direct Channels Group, or “Channels”. Immediately the rollercoaster ride of owning a business began: on her last day with her previous employer, she learned her first client – the one that was, in many ways, giving her the confidence to start her business – announced they were on the verge of bankruptcy.

Her boss said she could stay, but Melody turned down the offer. She told me, “I always think about the story I’d tell. If I let that be the ending, that would be a lame story. However, if I still started my own company, that story would be a better one– even if I failed.”

It was her passion for storytelling and communications that fueled the idea for Channels – that plus a bad customer service experience with a wireless carrier. She created Channels to address “dialogue” as both an issue and area of differentiation for companies. Channels seeks to find a unique voice for its clients, especially in one to one conversations with customers.
“It’s about creating the conversation, whether it’s through customer service, sales, or other channels. Ultimately, it all impacts the bottom line, and companies are losing sight of that. I realized how terrible some customer experiences have gotten, as the company representative leads you through a script. You don’t need to have a longer conversation; you need to have a more relevant conversation.”

Not surprisingly, Channels specializes in owning end to end experiences with call centers, which spans the creation and delivery of signature training programs for representatives, to vendor selection and management.

And instead of failure, Channels has far exceeded her initial expectations. “I was shooting for $1 million in revenue in my first year, and I’ve tripled that.” She’s also gone from one freelance consultant to a team of fifteen. “I intended to keep my company small, but my clients need more, so I’ve made changes.”

Flexibility is something she emphasized among her recommendations to anyone just starting a new business:

• Be malleable. “It doesn’t mean not having direction, it means adjusting your expectations and ideas as you learn.” Not only has Melody brought on more people than she had initially planned, she’s also looking at opening up subsidiary businesses.


• Focus on what’s important. “For the first 6 months, I didn’t have a day off, and every bump in the road felt like a huge obstacle. It’s so easy to get caught up in every little issue; you have to be able to anchor yourself.”


• Do a gut check. “There are things you know going into the business; then there are things you don’t. And the sheer capacity of what you don’t know will knock you back. You just need to absorb as it comes.”


• Focus on your strengths and invest in people who fill the gaps. “I personally recommend having someone smarter than you manage the financials. Understand what they’re doing and maintain control, but accept that you can’t know and do everything.”

With a successful first year behind her, Melody looks to continue growing her business and helping clients do the same. I thank Melody for sharing her story and insights and believe that her tips can be helpful reminders on the importance of focus and flexibility – regardless of how long you’ve been in business.

If you are an American Express OPEN Cardmember and haven’t created a profile on OPEN Forum, I invite you to do so – simply log in to OPENForum.com with your Americanexpress.com user name and password to get started.

For more information on Melody Medina or Channels (Cardmember since 2008), visit their Connectodex profile or www.directchannelsgroup.com.

Listen to Your Customers to Find Innovation

This blog entry first appeared on openforum.com, American Express OPEN's award-winning site providing insights, advice and connections for small business owners. You can find more articles and updates at http://www.openforum.com/

You can also follow me on Twitter at @jasonrudman and follow OPEN Forum at @openforum. This post was written in collaboration with Courtney Colwell at Federated Media.
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I’ve heard from several business owners who have created new products or services or expanded into new markets to fuel growth during the recession. And what’s always interested me most is how they’ve identified those opportunities. A great example is provided by Anthony De Filippis, who recently told me: innovation comes from listening to your customers.

Anthony is President of DeFiliSolutions (DFS), a company he started in August of 2009 as a joint venture with CargoTrans, the company his father founded in 1989. Whereas CargoTrans facilitates international shipping and logistics for exporters/importers; DFS provides consulting, administration, virtual office capabilities, vendor management and other services that help make it easier for importers and exporters to operate locally.

DFS was borne from a commitment to customer service, an understanding of business needs and an ability to address these needs with quality in mind. “Over the years, we found ourselves being asked by clients to perform services that were outside the scope of our shipping business,” Anthony told me. “Instead of passing this business on to other companies, we decided to introduce DFS and capitalize on this market.”

DFS counts international fashion companies exporting to the U.S. as their core clientele, based mainly on great "word-of-mouth" referrals from CargoTrans. And the smaller, design companies have proven to be a source of business during the recession. “With the financial crisis, many of our clients needed to scale back operations here in the U.S., and DFS has been able to alleviate some of the stress and help them still maintain their presence. Our goal is to assist foreign companies in managing or creating a wholly-owned U.S. subsidiary while maintaining a lean cost structure. By taking care of the back-office responsibilities, DFS allows them to focus on product and sales.”

I asked Anthony what he thought were the advantages of being associated with a more established company. “Our partnership with CargoTrans means we can offer a one-stop shop for clients, which is a real differentiator. Others who claim to offer a similar range of services are outsourcing. With companies being in the same office, we know more about what’s going on with clients’ shipments.”

“On the other hand, it’s difficult in trying to get clients to understand that DFS is independent. We don’t want them to feel like they’re ceding too much control. There’s fear of becoming too dependent on a provider, as it’s not easy to switch. That’s another one of our challenges: convincing potential customers to switch.”

Anthony is continuing to grow within the fashion and apparel industry, including marketing at international trade shows. And, as DFS continues to learn from their customers, he plans to identify opportunities to expand into other industries.

If you are an American Express OPEN Cardmember and haven’t created a profile on OPEN Forum, I invite you to do so – simply log in to OPENForum.com with your Americanexpress.com user name and password to get started.

For more information on DFS and/or CargoTrans (Cardmember since 1990) visit CargoTrans and DeFiliSolutions.

Six Key Benefits of Using Social Media for Small Business

This blog entry first appeared on openforum.com, American Express OPEN's award-winning site providing insights, advice and connections for small business owners. You can find more articles and updates at http://www.openforum.com.

You can also follow me on Twitter at @jasonrudman and follow OPEN Forum at @openforum. This post was written in collaboration with Courtney Colwell at Federated Media.
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Occasionally, I’ll read an article suggesting that small businesses aren’t seeing the value of social media, the evidence most often cited being a lack of direct sales for some business owners. And each time I want to ask, what were their initial strategies for using social media? What about the other benefits they might see?

Given the impressive array of social media tools you can choose from – such as blogs, Twitter, LinkedIn, and OPEN Forum – it’s become increasingly important to first develop your strategic goals for how social media might help your business, and then determine which tools will help you achieve those goals. This first step cannot be underestimated, as how successful you are with social media should be measured against those goals.

In thinking about your strategy, consider the following key benefits I most often hear from small business owners:

• Search results: In a previous article on building exposure through search results, I discussed how using social media can help you improve your ranking in search results. By extending your presence onto other sites, especially those of high “quality”, and building links from those sites back to your own, you can help elevate your ranking in search results and thus increase exposure for your business. But you should be thoughtful in your approach, as how and where you build those links carries different value. To be more efficient, focus on sites and engagement most relevant to your existing and potential customers.

• Brand management: As Yelp and other opinion sites gain momentum, you should consider your options for protecting your brand reputation, remembering that advocates as well detractors can comment on your business. By using social media to proactively find and build relationships with customers; you may be able to turn them into fans to help deflect any negative opinions that may arise. As the saying goes, the best defense is a good offense. Also, by building more positive sentiment for your brand through social media, you can help ensure that when someone searches for your company, they’re less likely to find any negative comments or that any they find are far outweighed by positive sentiment.

• Relationships: More than a broadcast tool, social media offers a unique opportunity to network online and build your business. Paul Rosenfeld, CEO of Fanminder, has found partners, customers, investors, and employees through social media, including on OPEN Forum’s Connectodex. Donna Johnson, CEO of Indie Business Media, said recently about Twitter, specifically: “I use it to have conversations and share information with my customers and business colleagues. I reach out to them, they reach back to me. We share, connect, learn and talk business. How can that not be a benefit to my business, even if every Tweet does not result in a sale?”

• Brand awareness: Social media presents an incredible opportunity to generate brand awareness among a targeted audience. Begin by researching what channels and tools your customers are using, and then start engaging and linking back to your own website. While you may not see an enormous spike in traffic, you can be reasonably assured that those who do follow the link are more likely to be future customers. “I’ve gotten quite a few leads from OPEN Forum,” Suzanne Vara, founder of Kherize5 Advertising & Marketing. “It’s taken time to build a consistent presence, but eventually, people have noticed how involved I am in the community and have started reaching out.”

• Innovation: Social media can be a great learning tool, as well. By knowing where your customers are talking about your products and services – or better yet – giving them a place to do so on your own site, you may find new areas for improvement or innovation. Many of the improvements we made to OPEN Forum came after paying attention to feedback we’d received on the previous version of the site, as well as engaging our customers in conversations about how best we can meet their needs.

• Competitive Research: Besides the concern that your competitors may already be using social media, the upside is that by following what your competitors are doing and saying, or what customers are saying about them, you may find ways to differentiate your brand and get better results. Rosalie Kramm, President of Kramm & Associates, says, “Keeping track of competitors and clients’ activities is very valuable. I can see what competitors are doing on social media and see how they’re marketing themselves.”

Given these benefits, it is worthwhile noting that not all social media tools are right for every small business. While it may offer a less-expensive marketing option, social media marketing can sometimes cost more in time than in money. That’s why it’s so important to start with a strategic vision for how social media can contribute to building your business. As Anita Campbell says in this article on social media, “From a business perspective, if this is done aimlessly it can be more noise than signal... Often this disappointment results from approaching social media without a clear strategy and plan.”

Social media should be considered as part of your overall marketing plan, tying back your activity to specific goals, such as generating awareness for a new product or event or creating a feedback channel for customers. Once you determine some clear objectives – as well as where your audience is – you can develop a plan for what channels to use and how much time to dedicate. This will help you separate social media as a business tool rather than diversion, and then you can better assess if the time invested is paying off.

If you are an American Express OPEN Cardmember and haven’t created a profile on OPEN Forum, I invite you to do so – simply log in to OPENForum.com with your Americanexpress.com user name and password to get started.

Building Exposure through Search Results

This blog entry first appeared on openforum.com, American Express OPEN's award-winning site providing insights, advice and connections for small business owners. You can find more articles and updates at http://www.openforum.com.

You can also follow me on Twitter at @jasonrudman and follow OPEN Forum @openforum. This post was written in collaboration with Courtney Colwell at Federated Media.
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The power of social media to help make connections may be obvious to many business owners, but what may not be is the effect it can have on your search rankings. And for marketing your business, there are few tools more critical than search rankings, as this is most likely how your customers will find you.

There are many Web sites, articles, and other resources that can help explain the impact of social media on search engine optimization (SEO) more fully (John Battelle’s Searchblog is one such resource). At a basic level, though, SEO involves incorporating into the content of your Web site(s), blog, and/or other online properties target keywords and other tactics to increase your rankings among organic results (as opposed to paid inclusion). Important tactics include increasing the number of places where your content exists, as well as ways people can find it.

If another site links to yours, search engines read this, i.e. the more “inbound” links to your site, the better. However, not all links are equal; quality matters. Inbound links from “quality” web sites with high relevance and authority hold greater value, as do organic (editorial) links. Good examples include a link to your site from within an article, your own guest blog post, or a profile on a site.

So where do you start? Well, first answer what you are trying to accomplish with social media. In an article about getting started in social media, John Jantsch outlined some initial thoughts to consider in building your social media strategy. He described a “hub and spoke” model, in which your “hub” is the central location for your online brand presence – the home base you use the “spokes” to drive traffic to. Your Web site and/or blog could be your hub; your spokes (link) could be a fan page on Facebook, videos on YouTube – or a profile on OPEN Forum. These quality links can then help elevate your ranking in search results and, thus, increase exposure for your business.

For OPEN Cardmembers, creating a profile in the Connectodex is an easy way to add a high value link. By creating a descriptive profile on OPEN Forum, one that includes your own URL, your business site may benefit from OPEN Forum’s demonstrated “authority” in search rankings. And, the more “spokes” you link to via your profile, such as to your Twitter page or LinkedIn profile, the better. Remember also that a compelling description, one that includes terms that potential customers might use to find you, can help.

One of the most compelling examples of this is demonstrated by my search for “Hufft Projects”, an architectural firm and OPEN Forum member based in Kansas City, MO. The image above shows those search results, the first being their Web site, the second their listing in a regional directory of architectural firms, and the third is their profile on OPEN Forum. What is worth noticing about these results against some other searches is that Hufft Projects’ Connectodex profile appears even higher than their Facebook and Twitter pages. While it is not necessarily the case for all Connectodex profiles, the detailed description Hufft Projects created indicates how a robust profile can help you build search equity.

If you are an American Express OPEN Cardmember and haven’t created a profile on OPEN Forum, I invite you to do so – simply log in to OPENForum.com with your Americanexpress.com user name and password to get started.

Talking Business at CES

This blog entry first appeared on openforum.com, American Express OPEN's award-winning site providing insights, advice and connections for small business owners. You can find more articles and updates from CES at www.openforum.com/ces.

You can also follow me on Twitter at @jasonrudman and follow OPEN Forum @openforum. The article was also written in collaboration with Courtney Colwell of Federated Media
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Last week, I was fortunate to attend my first CES and be amongst the newest innovations and product launches. The latest in 3-D technology, touch screens, tablets wowed me....the list is endless. It was truly a great experience.

Many of you who, attending for the first time, felt the same. Others have been attending for many years, as you’ve discovered that CES offer entrepreneurs not only great opportunity to buy or sell their products, but also to connect with each other. When business owners get together, “magic” happens – and, that “magic” was continuously on display in the American Express OPEN booth.

This was OPEN’s third year in attendance but our first in integrating our consultative product experience with an OPEN Forum Speaker Series. Attendees were not only able to learn more about how our products and services can help them manage and grow their businesses, they also had the chance to interact with business experts like Tony Hsieh of Zappos, Guy Kawasaki of Alltop, Anita Campbell of Small Business Trends, John Jantsch of Duct Tape Marketing, and Barb Dybwad and Ben Parr of Mashable. Their presentations on a broad array of business topics, combined with Q&A from the audience, sparked lively discussion.

From those and our conversations with other business owners in the booth, the following five themes seemed to be most prevalent.

1. Focus on Your Vision

While it remains a challenging economic environment, there was a general sense of resilience and optimism among the business owners I met. The key to maintaining that, according to at least two of our speakers, was to pursue meaning over money, or, as Tony said, “don’t chase the paper, chase the dream.” It was a great primer to start of 2010 – a reminder to focus on creating a vision and adding value, rather than on just increasing the return.

2. Jump to the Next Curve

Now is the time to innovate, so that when the recession ends, you can come roaring back. Guy explained how companies need to “jump to the next curve” in order to truly be successful. This means not being content with 10% improvement but shooting for 10 times improvement. You can find more in his Art of Innovation presentation from CES.

3. Build a Great Culture

Building a great company culture was a key theme in Tony’s presentation, as he credited their culture as being a key contributor to Zappo’s success. He talked about the positive impact culture has had on their legendary customer service, and providing great service is their focus. As Tony said, Zappos is “a service company that happens to sell clothing, shoes, handbags, eyewear, watches (and eventually a bunch of other stuff).” This makes hiring the right employees is critical to Zappos, and they even go so far as offering employees who aren’t a cultural fit $2,000 to quit.

(I invite you to read Rohit Bhargava’s article “10 Small Business Lessons from Zappos” to learn more about this innovative company.)

4. Create Efficiencies

There probably is no better place than CES to find the technologies that can help a business become more efficient, and this was true at the OPEN booth, as well. In our booth attendees could learn about OPEN products and services that can help their businesses, as well as hear from Anita on how to build a more resilient and efficient business. Among her recommendations were to find and focus on your best, most profitable customers. As she said “all customers are not created equal,” so you should create watch lists and take immediate action if you see a customer is falling behind on payment.

She also talked about tools and processes for invoicing and collection that can help you get paid faster by your customers. As she cited, 42% of small businesses say “getting paid quickly by customers” keeps them up at night, and among her tips on getting paid faster were to accept more payment options, like e-check and credit cards, and using an automated invoicing and payment solution. As an example of one such solution, I encourage you to learn more about OPEN’s AcceptPay.

5. Use Social Media

John discussed how social media can create marketing efficiencies, but, as with any marketing plan, you need to be strategic in your approach. The low-cost appeal of social media can lead many business owners to try to do everything – and end up doing nothing. Using social media requires resources (like time), so you should first determine the most effective use of those resources. Determine where your audience is, and then plan on how to reach them.

John also talked about how to build your local business through social media, a very helpful topic in light of some of the trends also discussed by Ben and Barb. They talked about how the proliferation of mobile devices and applications, Twitter, GPS and other location-based services are making it more important to build your localized presence, and how social media in general is driving businesses to become more personal. People want to build a relationship with your brand; using social media enables you to engage with them and build those relationships.

Guy spoke specifically on Twitter, providing "push-the-envelope" tips on how to use it, not only for communicating with customers and prospects, but for listening to what they have to say. (You can read this great summary of Guy’s tips by Anita.) All of our speakers advised businesses to use social media as a tool for listening rather than simply broadcasting. Twitter, in particular, is a great tool for finding what people are saying about your brand (and your competitors’) – as well as what’s being said in your industry. Indeed, OPEN Forum Pulse is one place where you can see what business owners are talking about on Twitter.