In the recent HBR article “The Crowdfunding Road to Hell,” Daniel Isenberg argues persuasively that crowdfunding — specifically equity crowdfunding — cannot work.

As an entrepreneur, angel investor, VC, philanthropist, and CEO with 40 years’ experience, I cannot agree.

From my experience investing in emerging start-ups (I’m invested in 60 right now) and launching my share of both failures (4) and highly successful (3) companies, I can attest that Mr. Isenberg is perfectly correct in his assertion that it’s dangerous to expect crowdfunding of equities to work the same way crowdfunded donations do. Furthermore, I understand all too keenly the complexities of determining a fair valuation for companies that are too early in their development to fit existing measurement standards and can’t meet the criteria for standard bank or SBA funding. I also agree that due diligence is an imperative — and is often overlooked by crowdfunders as impractical or overly complex.

Read the entire article at Harvard Business Review.

There’s something to be said for walking a customer through a logical, natural buying process. At MarketStar, we have been preaching the value of Lead Nurturing to our clients for years. But as seen recently, there is nothing like a “real world” example to really drive home the science behind a concept.

For those of you under a rock, Avengers opened this last weekend to stellar reviews. The movie follows “Earth’s Mightiest Heroes” as they battle invading forces set on taking over the world. Marvel Entertainment began an elaborate nurturing campaign in 2008 to build unity in their Marvel Studios properties; including Iron Man(2008), The Incredible Hulk (2008), Iron Man 2 (2010), Thor (2011), and Captain America (2011).  In each movie little pieces and hints were strung together to connect the characters, and set the stage for a movie where they could interact.

By the time The Avengers hit the screen, customers were familiar with the product, the story, and had a favorite aspect that appealed to them. These customers were already sold, greatly reducing the amount of effort needed to get them to make the purchase.

To say The Avengers was a success would be an understatement. The Avengers’ opening weekend ticket sales topped $200M in the USA alone, while grabbing over $600M in worldwide sales. Both of these numbers smashed records in ticket sales, and this was no accident; customers were ready to make the purchase.

Marvel Entertainment knows the value of nurturing their customers; they have done it for over 70 years. The Avengers is a model case study in the power of nurturing your customers. Nurturing permits companies to engage and progress leads towards a purchase, while identifying their buying intent. This ensures sales reps spend more time selling to those leads that are ready to purchase. After all, isn’t it easier to sell to a customer who has the cash in hand and is ready to make a purchase?

Learn more about lead nurturing by downloading our Nurturing eBook.

I have the privilege of a weekly interaction with a high-functioning autistic child we’ll call Ryan. Ryan enjoys our time together in his own unique way. A few weeks back Ryan and I connected over a very unexpected topic – Mentos. When Ryan gets his mind on a topic it consumes him and this particular day his mind was consumed by the idea of a Mentos bombs. Ask him any question, “Ryan what did your mom make for dinner last night?” and his response: “MENTOS BOMBS!!!”

Anyone who’s spent any time on YouTube has watched at least one video of the impact created by combining Diet Coke and Mentos. If not try this one, or this one. It’s quite amazing the reaction that dropping such a small, innocuous little candy into a diet soda will create. Likewise it’s impressive to see the way people have leveraged that reaction to do some pretty innovative things; some laughable, and some beautiful.

From a sales and marketing perspective, we are all looking for that silver bullet solution or in the case of my analogy, that magical little Mentos that will create an influx of fizzy goodness that yields explosive results. As we know, however, there are no silver bullets in sales and marketing and the “Mentos Bomb Experience” can be ever-elusive. I’d like to propose that by studying the Science and Art of the Mentos reaction, we can learn a few things about channeling our efforts to create impact. As scientists have studied the Mentos and Diet Coke, there are a three relevant factors that influence the reaction: DENSITY, VELOCITY, TEXTURE.

DENSITY
Scientific studies prove a key factor affecting the size and volume of the Mentos reaction is the density of the Mentos in comparison to the soda, which allows it to rapidly sink to the bottom of the container. I compare density to operational focus. Interestingly, when Mentos are crushed up and placed into a Diet Coke, the fountains created are always 30-40 percent smaller than those created when the entire Mentos is placed into the soda. Too often, sales and marketing strategies are too broad and/or disconnected to create any measurable impact. Sometimes adding a very simple, but highly concentrated initiative to an existing program can be just what’s needed to generate measurable results.

VELOCITY
The velocity which the Mentos falls increases a displacement phenomena which in turn increases the amount of carbon dioxide bubbles generated. When we think about our sales and marketing initiatives, are we planning and executing our strategies in a way that allows the greatest speed and velocity? How often do great ideas fall victim to delays in planning and approvals? Critical details are added at all stages to avoid delaying the speed at which you intend to execute. The better you articulate an idea at its point of origin, the more likely you’ll be to quickly and efficiently execute against it.

TEXTURE
You may be asking: what does texture have to do with sales and marketing? There is an almost-magical effect between the smooth diet soda texture and the hard-yet-smooth texture of the Mentos. Experiments prove the gum arabic used to coat the Mentos reduces surface tension which encourages bubble growth because it efficiently disrupts polar attractions between water molecules, creating in it’s place “rapid pockets of bubble growth.” This led me to think about enterprise level organizations and where these pockets of “rapid growth” often occur. I believe the scientific principles behind the gum arabic holds true to sales and marketing. Rapid growth occurs at the point of least resistance. Corporate cultures that foster innovative thought are often the ones that push the envelope when it comes to culture models. Ask yourself: what is your organization doing to foster opportunities to create these pockets and then leverage the fruits of those innovative endeavors?

At MarketStar, we are looking for more relevant scientific or artistic metaphors that help us think about our roles in new and unexpected ways. I’d love to hear your thoughts about Science and Art and the Impact it generates.

Entrepreneurs who thoroughly know and understand potential buyers have a terrific opportunity to grow their businesses by building and selling superior products to meet customer needs.

Historically, the best approach to building and selling award-winning solutions is to talk with customers to learn about their wants, needs and wishes. This process begins by learning what clients have been buying to meet their needs. Questions might address customer satisfaction level with the current competitive offering, the price paid for the product, where it was purchased and any information about product features, warranties and support.

Read the entire article at deseretnews.com.

How great would it be to only have customers who buy frequently, never return products and drive a ton of referral business without ever needing support?

Of course, we all know this is not possible but implementing the right after-sales strategy might get you closer than you think. The key, as bad as it sounds, is to use your customers. While social media has increased competition and evolved buying behaviors, it also has amplified the potential value customers can bring to your company.

The increased value of customers goes beyond additional purchases, spending more and returning less. It is about turning your acquired customers into an army of advocates who positively influence peers before, at and after a sale on your behalf. According to a 2011 study by ROI Research, 60% of U.S. social network users (65% of U.S. adults use social media — Harris Interactive) were at least somewhat likely to take action when a friend posted something about a product, service, company or brand on a social media site. These prospective brand soldiers have easy access to tools necessary to create awareness on your behalf, share experiences and spread the word about your brand, products and promotions with one click to more potential customers than ever before.

Transforming customers into advocates means companies must go beyond great customer service. It is about making customers feel valued, connected and an integral part of your brand. Here are some tips on how to achieve this:

• Connect Them. Marketers need to find ways to connect with current customers and continue the conversation about the brand and products. This means companies need to switch from reactive to proactive engagement of customers. The conversation can be continued through nurturing customers similar to nurturing leads, but customized to drive actions of repeat purchases and sharing of information with peers. Additional tactics include providing them with special treatments such as sneak peeks of new products, asking for their feedback in product development, invites to exclusive events, releasing a new product to them prior to the public, etc.
• Simplify Sharing and Consumption. Once you figure out how to engage your customers, you need to find ways to encourage your customers to share their stories and provide them with content that is easy to share with peers. Remember that information should not only be easily shareable, however, but should also be easy for recipients to consume and take action. One of the easiest things to do is add code to a website for customers to share on social media sites or via email. Explicitly ask customers to share their experiences in places where your prospects frequent.
• Reward Them (and Their Peers). Encourage sharing of content, information and positive experiences by offering rewards. Not only does this increase the quantity of shares, but it also creates an emotional connection between your brand and customers by making their voice feel valued. Don’t forget to reward their peers as well. This can be done by allowing customers to share an offer with their peers and, in turn, the sharing customer also receives a special offer on their next purchase.

When building advocacy programs you are killing two birds with one stone. You create customers who are returning frequently and you create referral customers at a lower cost. Remember what we all learned in business school yet many companies forget when implementing their strategies: The cost of customer acquisition versus customer retention could reach as high as 700%. What is even more incredible is that increasing retention rates by as little as 5% can increase profits by as much as 95% (Frederick Reichheld of Bain & Company)! So why then, do companies put so much money behind generating early-stage leads only to cut investment on the customer management side and miss out on the benefits valued customers provide?!

MarketStar was recently referenced in a TWICE Magazine article regarding TV sales leading up to the Super Bowl. The article cited our analysis of retailer point-of-sale data, which indicates a significant uplift in sales just before the Super Bowl — approximately 15% over typical run rate sales. But the question is this: Is it the event hype or simply the consumer market responding to retailer marketing programs?

The uplift in television units to close out the “holiday buying season” is not surprising. As my economics professor used to say, “There is no supply demand curve on this planet where units don’t increase when price decreases.” (Note: He also told us that drinking significant quantities of expensive, imported beer was his personal pathway to success, a theory not validated by the author.)

Starting in November, retailers begin ratcheting up their discount rates and promotions on televisions. As you would expect with declining prices, unit sales increase. In early January, prices go back up (with units declining) until about two weeks before the Super Bowl, when prices are once again dropped, leading to the increases cited in the TWICE study.

So while sales do increase leading up to the Super Bowl, our analysis indicates it is simply an efficient market responding to lower prices rather than any special homage to a football game. At other times during the year when discount rates match, similar sales uplift occurs.

In other words – there is no “Super Bowl” effect.

Other takeaways from our analysis:

• The Super Bowl Is Great, But It Ain’t Christmas. In the TWICE article, we were quoted discussing the uplift leading up to the Super Bowl. To clarify, sales are higher leading up to the Super Bowl than a regular week during the year, but do not match the unit sales seen Black Friday through Christmas. The retailers use the Super Bowl as an excuse to promote products and clear out inventory, often using the same pricing strategies they employed during the holidays.

• TVs – Not a Growth Category. If we compare this year’s holiday season to the same period last year we see a startlingly flat year-over-year sales trend. Even without price cutting, margins are low and retailers are not pushing the category as they have in the past. The lack of growth validates the commoditized nature of televisions – tons of brands, little differentiation and declining prices.

• I Love My Team, But Not That Much. Having your team play does not lead to any geographically based sales increase. Neither the New England or tri-state areas saw any significant TV uplift relative to the rest of the country. The same was true last year as well in Wisconsin and Pittsburgh when the Packers played the Steelers.

• Maybe Size Doesn’t Matter. For televisions, the sweet spot remains the mid-range category (defined between 32” and 45” screen sizes). Not coincidentally, this is also retail’s most profitable category. Unless production costs change dramatically, expect to see this trend continue.

In summary, television-loving Americans are proving more and more adept at responding to pricing measures rather than “event buying” as they may have in the past.

I am often asked these questions by aspiring entrepreneurs who want to start a business: What do I need to do to be successful? Where can I receive help? What resources are there? Who can guide me? How do I find money? Do I need a business plan?

Time after time, I hear similar thoughts from hundreds of individuals with the desire to launch a business. Just this morning, I received a call from a fellow who needs help. Unfortunately, and all too often, I don’t have the time to sit down with everyone individually to provide adequate answers to their inquiries. With this in mind, over the next few weeks I will write articles to answer most of these questions, plus many more that will assist someone who is ready to take a leap of faith.

Read the entire article at deseretnews.com.

They say what happens in Vegas, stays in Vegas… but in the case of what was shown at CES, I hope not! The technology was awesome—from breathtaking new televisions to ultra-thin new ultrabooks, and all sorts of fun for music lovers. Equally inspiring were some of the people presenting products, including our own MarketStar brand advocates.

I spoke with brand advocates on the show floor representing brands like Sony, LG, Canon, ZTE and BlackBerry who were doling out a wealth of information like free candy. Their passion for the technology and brands they represent combined with their superior knowledge of these products was more than impressive– it was stunning! I interviewed a handful of brand advocates to ask “What does a MarketStar brand advocate do?”

Below is a link to the video. Hear what brand advocacy means in their own words— a glimpse into what it means to represent a brand from the perspective of just a few of our 2,500 representatives that bring brands to life in the field every day. Enjoy!

Companies tend to focus too much on their product or service, forgetting to listen to what customers are telling them. This often results in declining revenue and profit.

The goal of any business is to make money, but that objective is easier to reach when we listen to customers and know and understand their needs. The best way to do this is by listening to what they tell us. More often than not, in the course of a conversation, a customer will divulge information that is vital to our overall success.

Consider three areas related to customers:

Read the entire article at standard.net.

Back to the topic of content marketing! Today, I spent some time viewing and dissecting a couple of videos created by Coca-Cola. These videos provide a great overview of how Coca-Cola will evolve its marketing to change from “creative excellence to content excellence.” They are very well-produced and fun to watch, but the amount of information communicated is a little overwhelming. I am not sure why Coca-Cola decided to share these videos with the world — probably so people like I can blog about them. I highly recommend watching these videos but here are some great insights:

• Become a Storyteller:  Develop and create stories about your company and products that content consumers can relate to. I will always prefer a story about real-live experiences over a bunch of summarizing bullets!
• Provoke Conversations: Create content that people will talk about … enough said.
• Converse: The Internet and social media have definitely changed the way buyers obtain information and talk about you, and many companies listen. However, listening by itself is not enough. Companies need to engage and converse, meaning to not just consume feedback but also provide feedback. By the way, conversing with your consumers will provide you with great fuel for your stories!
• Explore New Ideas: Most marketers play it safe and only create “low-risk” content. Coca-Cola provided the 70/20/10 model when it comes to content development. This is a great model as it enables your marketers to explore new avenues, as well as new ways to tell stories and engage consumers. It provokes conversations, sets you apart and ensures you don’t get stuck in status quo.
• 70 percent of your content should be made up of low-risk content (but only take 50 percent of your time)
• 20 percent of your content should be innovation of the content that works (taking 25 percent of your time)
• 10 percent of content should be high-risk content implementing brand new ideas (using another 25 percent of your time)
• Liquid Content: Don’t lock it down too soon. Have it evolve over time but never replicate.
• More Content: Since your customers have easier access to content, it gets consumed quicker. This means you need to produce more content to keep it fresh.

This is a big shift for companies that takes time to implement and may even require an investment in resources. It is important, however, to start now so you are not left behind. Here are the two videos. I’d love to hear your take on them. Enjoy!

Coca Cola Content 2020 Part One

Coca Cola Content 2020 Part Two