Friday, August 12, 2011

The Secret Motive Behind Proprietary CMS Packages

My professional purpose is to help our clients make money. In this vein, PIR leverages technology to improve businesses, not to take advantage of them.

Agencies that deploy proprietary CMS packages for their clients have all the power in the relationship -- that's why they push them. It's their security blanket; your bottom line is not their concern.

Agencies that deploy open source CMS packages for their clients are committed to empowering their client rather than ensuring on-going dependence on them.

Beware of an agency that only offers their own proprietary CMS packages, rather than an economical, and cyber safe open source CMS package for three big reasons:
  1. You have no power when negotiating fees, timelines or deliverables.

  2. If you decide your agency is not delivering what you need and you want to part ways, you are at their mercy because proprietary systems means there are no outside developers you can ask to take over their tasks. You likely have to rebuild your site from scratch, all over again.

  3. Technological innovation is not a nice to have for your company — it is a need to have. Companies like Polaroid, Blockbuster, Palm — and soon RIM— failed because they did not keep up with technology trends, why not learn from their mistakes?

    Proprietary CMS systems means future functionality and technology upgrades will slow to a crawl. No agency can keep up with the rapid feature development occurring in these massive open source initiatives. For this reason you should be cautious when considering proprietary CMS packages.

While there may be many talented and well-intentioned developers within an agency that know better,  there is likely a money guy behind the scenes insisting that they only offer their own proprietary system as a solution.

However, if your agency is a true-blue partner, and comes to you and says: “We believe you should drive your business toward open-source CMS systems because...” Listen to them — and stay with them. They have your best interests at heart, and truly care about your profitability.

Friday, August 5, 2011

Social Couponing - When Is It A Good Idea?

The social coupon craze has hit a fever pitch with companies like Google, Yelp! The Washington Post -- and every Tom, Dick and Harry getting in on it. Although the back end is expensive to build, once launched it is a pure profit phenom. Jumping on the bandwagon as a business is easy BUT, is is good for your business? 

Though it appears on the surface that these offers are FREE for your business because there is not an upfront cash outlay don't be fooled. It's NOT free.  

So, when should you consider making an offer?

When you need a loan:
If you are in need of a quick infusion of cash, you might consider running a deal of the day. You get the cash up front, which is helpful when you need it. However, your business will pay later in the form of service to your customers and product costs (we had a client that sold over 6,000 meals). Be aware you can actually lose money if your deal isn't priced to incorporate the 50% that goes to Groupon, LivingSocial or other coupon vendors... AND your 50% discount offer on top of that.  

When you want to increase your customer base
Though it is not easy to do, it is possible to increase your customer base with social "couponing". In order to increase your customer base, you need to custom tailor your coupon/promotion in such a way that it will interest potential new customers more than the general social coupon audience that is just looking for a one-time deal.

Consider your deal carefully before you create it:
1. Is your deal too appealing to bargain hunters? 

2. Does your deal cater to people who really “get”your business?
3. Does you promotion lend itself to potential customers coming back?  

If your goal is to create the most appealing offer to interest bargain hunters, then consider your deal a high interest loan.   

If your offer is crafted with options 2 or 3 in mind, then you stand a chance of growing your customer base. 

Our advice is to think about your pricing strategy -- before embarking on any coupon  promotion.

When you want to test a new product or service
Given that these services tap into large audiences with broad appeal you might consider trying out a new offering on them (think, affordable focus group). Some of these coupon services offer feedback mechanisms for the merchant so they can understand how the purchaser perceived their experience. This information can be enormously helpful in tailoring your product or service for the future. 

Final thoughts you should consider before you jump in
Will making an offer taint your current customers? Some of your customers might decide not come back until you run another special, which could melt away your loyal bread and butter clients — so, be prepared.

The key to running successful daily deal promotions is in the preparation -- before you run your social couponing deal. Goodluck!