Friday, March 12, 2010

What’s Wrong With Your Business Model?



Assumptions and Leveraging

"The first layer of the perfect business model is to build a business with reliable revenue" The Attention Deficit Workplace: by Mitch Thrower


This is a continuation of a critique of the ReachCaribbean.com website. The intention is not to give a negative impression of the site but to have others learn from it so that they could look at their own site to determine if it conforms to generally accepted marketing practices.

Hopefully in the last post you got some ideas you can use on your site.
Today as promised we look at the site’s business model. The idea here is how the site converts a visitor to a paying client.

Right of the bat, I have to say that the “Getting Started” button is great. It tells a confused visitor to ignore the rest of links and start here. So let’s click that link.

Fortunately, their business model is outlined in the steps they assume a prospect to take.

The first step in the model is to determine if the prospect qualifies for the services.

Keeping in line with that, the model requires the prospect to fill out a Customer Needs Analysis CNA . It’s funny that they used the word “customer” the implication is profound but not for this post.

The information requested for the analysis is more like information for a customer assessment. There’s really nothing for the customer to analyze. It’s just marketing data required to plan an ad campaign.

What would have been more effective here is a real data so that the customer could analyze the results of past campaigns. Here is how their customer needs analysis is presented.

First ask yourself the following questions?

1. What would you like to achieve?
2. Who is your target audience?
3. Do you have a budget? If so, what is it?
4. What territories would you like to advertise in?
5. What is your media preference?

As a prospective customer, do you really want to ask yourself these questions? Absolutely, but do you want to share it with the site owners? Maybe, but at this point the information on the site does nothing to assure you that doing so will get you the results you are seeking.

The assumption here is that being a well respected organization they will not request any information that was not relevant to your needs and everything you provide is strictly confidential. Do you believe that?

In my opinion, there is only one question ReachCaribbean.com would like answered on that “customer needs analysis”. Guess which question. Hint it was so important there are two parts to the question.

Now think about this, have you ever gone to the provision market and the vendor said: “Tell me the meal you are going to cook, who you are cooking for, where they live and how much you have to spend on provision today”? Think you would buy that provision?

Let’s for a moment assume that you are desperate there is nothing to cook at home and you need to buy advertising. You download the CNA form and complete it. You are now at the third step in the process; you register.

Before you do, however, you are advised that that you will be contacted by an agent to get a quote on the Customer Needs Analysis you submitted. The assumption is that you have already made a buying decision, even without a price. Final step done, you can now cross your fingers and wait for a call that will supposedly give you the info you need and hopefully complete the transaction.

That’s the ReachCaribbean.com complete business model. Here are a few of the challenges the model faces:

1.It assumes that if the visitors are not ready to buy they are not valuable therefore there is no attempt on the site to capture the names of “interested” visitors who is just comparing alternatives.

2.It relies too much on the credentials of the Express for its credibility. There must be more convincing real reasons to get a “real buyer” to take the first step.

3.It also assumes that being the only kid on the block that provides this service most serious ad buyers would not hesitate to complete the “customer needs analysis”. Yes, they can reach 6 million people in the Caribbean but how many of the 6 million normally reaches back to the advertised businesses?

Well they did say to assume is to make an... you know the rest of that.

The recommendation is that ReachCaribbean.com should leverage the credentials of the Express but provide more proof on their site of their effectiveness in producing results for the advertiser.

The business model needs to be modified. It should be a smooth slide that delivers pre-qualified prospects into their laps instead of having the information loaded visitor climb one marketing step after another.

That’s it for today. If you have any additional comments or just want to make a suggestion please feel free the floor is yours. Until next week.

Be well.

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