More home based businesses may be borrowing following a trend seen across the small business spectrum this year.
Kabbage Inc., a financing company specializing mainly in home business lending for those selling goods on Amazon and eBay, reports paying out more than $200 million in annualized cash advances to more than 100,000 small business customers so far in 2013.
The company says the advances represent a substantial increase over an estimated $15 million in annualized cash advances paid out a year ago.
Kabbage Inc. recently released its latest lending numbers showing a borrowing trend for small online merchants and others working from home offices that may mirror similar activity in other small businesses.
Last month, the U.S. Small Business Administration reported an increase in small business lending for the first time in 10 quarters. Overall, the report found small business lending had increased by four-tenths (0.4) of a percent, from $584.1 billion in September last year to $586 billion by the end of 2012.
The SBA report noted an increase of loans in several categories including under $1 million, between $100,000 and $1 million, and under $100,000 in the final quarter of last year. However, the Kabbage Inc. report suggested some loan sizes are still underrepresented.
According to Kabbage, the company’s advances have grown by 298% from 2012 to 2013, while SBA loans under $150,000 have decreased by 8% in that time.
Because Kabbage mainly funds home office businesses, particularly those that sell goods on sites like eBay and Amazon, their numbers aren’t necessarily indicative of growth in small business lending as a whole.
The company is also just a few years old, so the increase in lending could be more indicative of its own growth and access to funding than of general economic factors. For instance, Kabbage just closed on a $75 million debit financing from Victory Park Capital and Thomvest Ventures. This represents the company’s largest funding transaction to date.
Marketing is a huge concern for all small businesses. Even if you have a great product or offer outstanding service, you’re not likely to succeed unless you can get your message out to consumers. To make matters worse, marketing is tricky because it changes so quickly. Traditional advertisements such as direct mail, in-print, radio, and TV ads are still used, but their popularity has diminished as society has become more electronic and internet-based. Interestingly enough, we’re also seeing changes in how advertising is done in the digital age. While businesses typically rely on email marketing and gaining business through their website, social media marketing offers new avenues to reach customers and build loyalty. A new study by Constant Contact illustrates the increased reliance on social media marketing,and the spread of marketing to a range of social media platforms.
Constant Contact is an online marketing company that offers marketing strategies for the digital age, including social media marketing. In May, 2012 they conducted a survey focusing on the challenges and strategies used by small businesses - surveying over 1000 participants in their Small Biz Council to gain insight from actual business owners. The results clearly show the importance of marketing. Here are some key points from the survey:
76 percent said that “how to attract new customers†was ‘what keeps them up at night’
49% find social media effective for marketing purposes, which ranked 4th behind email marketing, website and in-person interactions
 59% of respondents answered the question, “which marketing activities do you need help with?† with social media marketing
While this survey helps us get a good picture of the challenges and focuses of small business, Constant Contact decided that we could gain additional insights by conducting additional waves of the survey. You see, one survey gives us a ‘snapshot’ view of the conditions at a certain time. But by conducting a survey repeatedly, you can start to see changes over time. It’s pretty much like the difference between a photograph and a movie.
In December, 2012, Constant Contact conducted the third installment of this ongoing study, and the survey did show changes over time, especially in regards to social media marketing. What the results showed was an expansion of the social media options that small businesses were using and considering as effective marketing tools. The particular question asks which social media platforms do the small businesses respondents consider effective for their business. From May to December there are large increases in all social media platforms, but what is even more interesting is that we are beginning to see an expansion of the social media options small businesses are using. While Facebook continues to rank #1 in terms of marketing effectiveness, other platforms are gaining some ground with small businesses. LinkedIn saw an increase of 19%, Twitter inceased 18%, and other platforms like YouTube, Pinterest, Yelp, and Google+ also saw increases.
The results may indicate a growing familiarity and comfort level with marketing via social media. Given its popularity, it is an effective way to reach large groups of potential customers. Also, small businesses are branching out beyond their initial comfort level to explore different tools in the world of social media marketing. With the increased popularity of Facebook alternatives, small business owners are recognizing that there are windows of opportunity to reach different groups of would-be customers through the wide range of social media outlets.
If you haven’t explored social media marketing - or haven’t considered the many social media platforms that extend beyond Facebook - make it a point to check out these sites today. Most are free to join, and you can take your time to explore on your own, deciding how you could spread your message with each unique channel. Here at Small Biz Technology, we’ll continue to bring you the latest updates on social media marketing, but it’s still up to you take the required steps.
Don’t put it off. New customers are waiting for you today.
Two prominent industry groups have announced plans to collaborate on a new professional certification program targeting cloud computing information security, though it's unclear how it may avoid overlap with existing industry certifications.
The International Information Systems Security Certification Consortium
(ISC)2and the Cloud Security Alliance (CSA) said this week that the professional certification program, which has yet to be named, will address enterprise security through global standards and best practices for designing and managing cloud computing systems.
The partners said rapid global adoption of cloud computing among businesses has created a requirement for what they deemed a "body of knowledge that encompasses the evolving technology and risk landscape, and that validates the skills of the professionals tasked with protecting those businesses."
The need for information security training has grown sharply as businesses shift more data to the cloud and users increasingly access public cloud services via mobile devices. A recent (ISC)2 study found that 61% of respondents worked at companies offering public cloud services.
John Howie, CSA's chief operating officer, described the collaboration with (ISC)2 as "a coming together of minds" on the growing importance of cloud security. Howie said (ISC)2 will leverage the CSA's intellectual property as the partners co-develop a rigorous certification program for cloud security that leverages the strengths of both organizations.
The growing need for a cloud certification program stems in part from what Howie called the "consumerization of [corporate] IT" via the cloud. The trend has resulted in employees accessing corporate networks via the cloud on a range of personal mobile devices. That means corporate data can sometimes end up on personal phones, tablets and other devices.
Hence, Howie explained, certification programs for cloud security must begin to take this trend into account, and training programs should - and will -- seek to implement techniques like "smart mobile device management," which Howie described as a way to support the growing consumerization of IT.
As cloud computing continues to grow, experts are concerned that enterprises lack a full understanding of the associated security risks.
The information security industry, however, is already awash with various certifications. (ISC)2, considered the largest non-profit organization for information security professionals, administers the Certified Information Systems Security Professional (CISSP) program, and numerous other related certifications. Meanwhile, for the past year the CSA has been vigorously promoting its Certificate of Cloud Security Knowledge (CCSK), an exam-based certification for cloud security practitioners seeking to validate their competency in key cloud security issues. The CSA announced version 3.0 of the CCSK in February.
The CSA stressed that its alliance with (ISC)2 will have little impact on its own CCSK effort. "That program is not going away," Howie said. "If anything, we will build on its success."
The partners said the first examinations for the professional certificate, along with new credentials, would be available during the first half of 2014.
Dave Shackleford, founder and principal consultant at Atlanta-based Voodoo Security, senior instructor with the SANS Institute and co-chair of the CSA's Top Threats to the Cloud Working Group, said that while he takes the alliance with a "grain of salt" because (ISC)2's business model hinges on creating certifications that generate ongoing revenue, he expressed confidence that the alliance would move cloud security to a higher, architectural level.
"Half of cloud computing is an outsourcing discussion," Shackleford said. "The biggest challenges for enterprises are around adapting existing audit, risk analysis and security controls definitions for multi-tenant outsourced environments, and there's certainly a wide variety of education areas that relate to this.
"I think CSA has a great framework with their cloud security guidance, both in the 14 areas and some of the controls lists like the [Cloud Control Matrix]," Shackleford added. "This seems like a good strategy for them, and creating a certification may make sense."
Ed Tittel, a network security specialist and authority in IT industry certifications, expressed confidence that the organizations would work toward "a more senior, architect-level cloud security certification.
"This could be good news for the many businesses and organizations that find themselves compelled to invest and jump into cloud-based applications and services to remain competitive," Tittel added, "despite their well-founded reservations about the security, privacy and confidentiality of these very tools."
I was looking to buy a new computer two weeks ago. I checked out a few websites, isolated some of my favorites, but I wasn’t ready to make a purchase yet. The next day I visited Facebook and amongst the jokes and status updates, on the right side of the page, was one of the computers I had been viewing the day before. Was it an eerie coincidence? No, it was Facebook Retargeting.
For those unfamiliar with Facebook Retargeting, here is a quick run-through. A user visits your page, and shows interest in a particular product or service. A cookie is then placed on the user’s computer. If that user walks away without making a purchase, custom ads are run on the right panel of Facebook, tempting the user to return to your website and make the purchase.
Over time and multiple retargeting efforts, you can see how this tactic can boost sales with customers you thought you lost. However, while Facebook Retargeting may be a good option for your small business, there are specific dos and don’ts to maximize its impact.  Perfect Audience, a company that offers Facebook Retargeting services, has some great ideas on doing it right.
DO keep your ads fresh! Use a variety of ads and monitor them over time to see which ads are performing the best.
DO set conversion goals. They will give you insight and motivation for your retargeting efforts.
DO point some retargeting efforts at people who signed up with your website or made a purchase. Their past behavior indicates that they may be repeat customers.
DO have a special campaign that retargets people who failed to complete your sign up process. A sign up process may have 2 or 3 steps, and if people leave before fully signing up, you should be retargeting them.
DO create ads that stand out. Colors like blue, green, red, yellow and orange will make your ad pop out instead of blending in with the Facebook background.
DON’T over focus on users who have already converted. If they’ve already signed up for your offer, you’ve won the battle and should start focusing on people who haven’t been converted yet.
DON’T use a retargeting platform that doesn’t differentiate among click-through and view-through conversions.
DON’T separate retargeting data from customer data. Merging the two will give greater insight.
DON’T retarget solely on page views. Consider what users do on your site, not just what pages they visit.
DON’T run generic ads. Your retargeting ads should show an obvious connection to your brand.
With these tips in mind, it’s time to start using Facebook Retargeting to bring in greater profits and convert customers you thought you lost. If you already have a Facebook Retargeting campaign, use these ideas to make it stronger and more effective. Or if you haven’t used Facebook Retargeting yet, follow these tricks to see success right away!
I was looking to buy a new computer two weeks ago. I checked out a few websites, isolated some of my favorites, but I wasn’t ready to make a purchase yet. The next day I visited Facebook and amongst the jokes and status updates, on the right side of the page, was one of the computers I had been viewing the day before. Was it an eerie coincidence? No, it was Facebook Retargeting.
For those unfamiliar with Facebook Retargeting, here is a quick run-through. A user visits your page, and shows interest in a particular product or service. A cookie is then placed on the user’s computer. If that user walks away without making a purchase, custom ads are run on the right panel of Facebook, tempting the user to return to your website and make the purchase.
Over time and multiple retargeting efforts, you can see how this tactic can boost sales with customers you thought you lost. However, while Facebook Retargeting may be a good option for your small business, there are specific dos and don’ts to maximize its impact.  Perfect Audience, a company that offers Facebook Retargeting services, has some great ideas on doing it right.
DO keep your ads fresh! Use a variety of ads and monitor them over time to see which ads are performing the best.
DO set conversion goals. They will give you insight and motivation for your retargeting efforts.
DO point some retargeting efforts at people who signed up with your website or made a purchase. Their past behavior indicates that they may be repeat customers.
DO have a special campaign that retargets people who failed to complete your sign up process. A sign up process may have 2 or 3 steps, and if people leave before fully signing up, you should be retargeting them.
DO create ads that stand out. Colors like blue, green, red, yellow and orange will make your ad pop out instead of blending in with the Facebook background.
DON’T over focus on users who have already converted. If they’ve already signed up for your offer, you’ve won the battle and should start focusing on people who haven’t been converted yet.
DON’T use a retargeting platform that doesn’t differentiate among click-through and view-through conversions.
DON’T separate retargeting data from customer data. Merging the two will give greater insight.
DON’T retarget solely on page views. Consider what users do on your site, not just what pages they visit.
DON’T run generic ads. Your retargeting ads should show an obvious connection to your brand.
With these tips in mind, it’s time to start using Facebook Retargeting to bring in greater profits and convert customers you thought you lost. If you already have a Facebook Retargeting campaign, use these ideas to make it stronger and more effective. Or if you haven’t used Facebook Retargeting yet, follow these tricks to see success right away!
My colleague Stephanie Faris recently wrote an informative article on webcasting options available for small businesses today.  Whether it’s live streaming or on-demand videos, webcasting is being used by companies of different sizes for creating impact in meetings and events. Depending on the nature of business, webcasts can be used to promote products and service, conduct Q&A sessions, impart training, host meetings and make announcements.
In related news, TalkPoint, a leading provider of global communications technology, has released this interesting infographic on a survey done across a section of their customers on benefits to businesses from webcasting. Â Check out the infographic below:
Webcasting Benefits for Small Businesses
Larger audience: More than 90% of the businesses reported an increase in their ability to reach out to larger audiences. As for why attendees prefer webcasting to in-person events; well this is a no brainer really. Majority said they could attend webcasts from any location; they could avoid travel; and some even cited the reason ‘I can sleep in my own bed’. 27% of the businesses experienced an increase of 20% in their audience via webcasting.
Reduced costs: Webcasting enables businesses with limited budgets to reach out to their target segment like no other medium can. Nearly 60% of the respondents said that webcasts helped reduce expenses associated with in-person meetings such as travel, hotel, venue, meals etc. Of that group 19% of the businesses were able to reduce their business travel costs by as much as 30%. Incidentally, costs associated with satellite radio subscriptions and CDs can also prove to be more than webcasting sessions.
Higher revenue: Webcasts reduce the time taken to do business. For instance they make it easier for businesses to communicate changes to their teams and improve employee productivity. Webcasts can be used to communicate with client on new products and services, thereby reducing the lead generation time. 16% of the respondents from the survey were able to attribute use of webcasts to increased revenue.
Content is King: Webcasting offers businesses the opportunity to be as creative as possible via various presentation methodologies and multi-media. The biggest deciding factor in registering for a webcasting event was content (82.8%), followed by the speaker (5.4%). Most attended events included best practice sharing, corporate town-hall and professional meetings.
Majority of attendees continue to view webcasts on their desktop or laptop computer, with only about 15% viewing on smartphones and tablets.
Ensuring success of your webinar
Enough said about the power of webinars; but how do you ensure that your business webinars are a success? Here are a few useful tips.
Promote the event: As per the TalkPoint survey, more than 80% of the respondents felt the best way to engage viewers in webcasts is to promote the content and speakers (88%) and offer credit certification (19%). Ensuring targeted communication both before and after the webcasting event will enhance the impact of the webcast message.
Be well prepared: The biggest and the most avoidable faux pas during webcasts are microphone not turned on, presenters not realizing when the camera is focused on them, poor lighting, too much background noise and typos.
Avoid these pet peeves: Having the right infrastructural support to deliver an impactful webcast is half the battle. The webcast being too long, content being irrelevant and the presenter failing to engage the audience is likely to make the focus of the webcast audience wander. Engaging your audience via interactive Q&A discussions, enabling online feedback via social media applications and presenting content that is in sync with the webcast objective will help make your webcast event a success.
While webinars are a great tool for smaller businesses to reach out to their client base, they can also be a great way to impart training as a company grows. Webcasting software has been used effectively in numerous industries such as healthcare, educational training, retail, non-profit and government, retail and finance. If you are a frequent webcast user, we’d love to hear from you on which webcasting service you found to be the most effective and how has it benefited your business.
There are several security issues small business owners need to think about when implementing a BYOD (Bring Your Own Device) program and policy. You lose control of the IT. PC World says, “Company-issued IT typically comes with an acceptable use policy, and it is protected by company-issued security that is managed and updated by the IT department. It is a little bit trickier telling an employee what is or is not, an ‘acceptable use’ of their own laptop or smartphone.â€
Employees can lose devices containing sensitive data, and retrieving company data in the event of a dismissal or resignation can be difficult.
Herb Hogue of En Pointe Technologies was kind enough to send us some tips for small businesses that are thinking about allowing employees to bring their own device to work. Check it out:
Control Without Limitation. Employee device security can be an issue for IT departments of all sizes. Controlling the access to important data without limiting your employee’s use of their personal applications is an issue that affects both small businesses and the enterprise. The difference is the amount of resources available to monitor and protect those devices that are being connected to the company’s infrastructure.
Security. A proactive approach to security will help protect small businesses from the costs associated with loss data or downtime due to malware. An Endpoint security protection suite combined with firewalls, intrusion prevention and a centralized management console will give the ability to monitor and protect a company’s network, as well as run reports to pinpoint areas of vulnerability. Employee device issues with ever changing devices and new security risks require that security training and enforcement of company policy are integral to keeping companies protected.
An Effective Policy. An effective policy for employee device programs is one that protects the employers as well as offers the freedom that the employee desires to perform their job effectively. Things to consider when putting together a policy are:
Who is using the device? Role and responsibility will determine what informational access they need.
Can you limit their access without limiting the employee’s productivity?
Define Responsibility. For a small business, it is important to make clear what is being handled by the company and what is the responsibility of the employee who owns the device. What devices and operating systems will be supported by the company? Do you have the expertise on staff to offer support and will your IT staff be able to handle the additional calls? Can you put together a website to help assist your employees with low level issues they can solve on their own?
Understanding and Enforcing Policy. Make sure that your employees understand the employee device policy and are well versed in the security applications mandated by your company. Enforcement of the policy and the ability to change the policy as new situations arise will ensure the success of the program.
-
We’ve offered a lot of tips and advice on the BYOD movement in past articles on Smallbiztechnology, so check them out if you are considering implementing this into your business.
You could also consider an alternative to an employee device program, which we’ve covered before, called COPE (corporate-owned, personally-enabled). COPE “is a plan you make with a wireless management firm to order smartphones for your employees,†says our own Miguel Leiva-Gomez. “Some companies already issue mobile devices to their employees, but COPE handles this process differently.†Check out our previous coverage for more.
Let us know in the comments about your experience with employee device programs!
The history of invoice factoring goes way back to the times of King Hammurabi of Mesopotamia, over 4000 years ago. It has been playing an active role in business finance since then.  From medieval businessmen to English colonists  and from garment textile industries to transportation industries   invoice factoring has a long history.
Today, with some banks limiting loans to small businesses, invoice factoring has emerged as an increasingly  popular means of alternative finance. Since factoring advances money on Read More
A new study from Adobe of more than 1,000 business owners and managers has found fascinating insights on how paper-based processes are viewed in the business word. The overwhelming majority of managers expressed a negative perspective toward the security, efficiency, cost, and environmental impact of paper compared to evolving to a fully digital workspace.
Paper is More Expensive
This one is a no-brainer, but the single most obvious benefit of moving away form paper-based processes is the money and time saved buying huge reams of paper on a constant basis. Of the managers surveyed, 47% noted the cost of paper as a major negative of paper-based work and 61% said they would welcome the cost-benefits of going fully digital.
The cost of paper, as well as printer and copier toner and pens, is only one aspect of the overall expense. Paper requires storage and with office space typically the single biggest expense of many businesses, more than half of respondents said one of the biggest negatives of using paper is the limited space.
Paper is Less Efficient
Among the survey participants, only 36% claimed paper allows them to be more productive while 51% said that digital processes allow them to be more efficient. That is one of those “to each his own†scenarios but when you look at the deeper questions you can tell that the efficiency of digital streamlining far outweighs any productivity boost a paper document can give you.
53% said digital processes help simplify work
51% said digital processes make it easier to file, manage, and find documents
38% said that paper-based processes simply create more work
Paper is Less Environmentally Friendly
We live in a quickly changing world and employees and clients want to do business with environmentally conscious modern companies. Of more than 1,000 business managers surveyed, 48% have a negative view of paper because it is harmful to the environment while 72% said they would like to use digital contracts because it helps the environment.
Moving away from a paper-based business also makes you company seem more modern. More than 75% of respondents said they are impressed when a company has a strong digital presence while 68% of respondents said that paper-based processes make a company seem old fashioned.
Paper is Less Secure
Among the biggest negatives to using paper appears to be the risk of losing or misplacing contracts and important documents. More than 55% of respondents cited the risk of losing a paper contract as a negative of paper-based business while only 40% claimed that paper makes it easier to locate files. Perhaps it depends on how organized each manager’s office space is, it’s hard to compete with the simplicity of searching for a document name on your computer and seeing it within seconds.
Still, 98% of respondents said they still use paper in their contract transactions despite the fact that 70% agree that digital contracts are more efficient and make life easier. Only 30% of respondents said they trust a vendor, client, or partner to not alter a paper contract and 67% agreed that paper contracts are more likely to be defaced or altered. Only 45% of people believe a contract in a locked file cabinet is secure.
As you can see, the business world is moving away from paper-based contracts and for good reason.
We’ve written a number of articles on this subject and the move from paper to digital. Has your business gone paperless or do you refuse to become a digital office? Let us know!
A new study from Adobe of more than 1,000 business owners and managers has found fascinating insights on how paper-based processes are viewed in the business word. The overwhelming majority of managers expressed a negative perspective toward the security, efficiency, cost, and environmental impact of paper compared to evolving to a fully digital workspace.
Paper is More Expensive
This one is a no-brainer, but the single most obvious benefit of moving away form paper-based processes is the money and time saved buying huge reams of paper on a constant basis. Of the managers surveyed, 47% noted the cost of paper as a major negative of paper-based work and 61% said they would welcome the cost-benefits of going fully digital.
The cost of paper, as well as printer and copier toner and pens, is only one aspect of the overall expense. Paper requires storage and with office space typically the single biggest expense of many businesses, more than half of respondents said one of the biggest negatives of using paper is the limited space.
Paper is Less Efficient
Among the survey participants, only 36% claimed paper allows them to be more productive while 51% said that digital processes allow them to be more efficient. That is one of those “to each his own†scenarios but when you look at the deeper questions you can tell that the efficiency of digital streamlining far outweighs any productivity boost a paper document can give you.
53% said digital processes help simplify work
51% said digital processes make it easier to file, manage, and find documents
38% said that paper-based processes simply create more work
Paper is Less Environmentally Friendly
We live in a quickly changing world and employees and clients want to do business with environmentally conscious modern companies. Of more than 1,000 business managers surveyed, 48% have a negative view of paper because it is harmful to the environment while 72% said they would like to use digital contracts because it helps the environment.
Moving away from a paper-based business also makes you company seem more modern. More than 75% of respondents said they are impressed when a company has a strong digital presence while 68% of respondents said that paper-based processes make a company seem old fashioned.
Paper is Less Secure
Among the biggest negatives to using paper appears to be the risk of losing or misplacing contracts and important documents. More than 55% of respondents cited the risk of losing a paper contract as a negative of paper-based business while only 40% claimed that paper makes it easier to locate files. Perhaps it depends on how organized each manager’s office space is, it’s hard to compete with the simplicity of searching for a document name on your computer and seeing it within seconds.
Still, 98% of respondents said they still use paper in their contract transactions despite the fact that 70% agree that digital contracts are more efficient and make life easier. Only 30% of respondents said they trust a vendor, client, or partner to not alter a paper contract and 67% agreed that paper contracts are more likely to be defaced or altered. Only 45% of people believe a contract in a locked file cabinet is secure.
As you can see, the business world is moving away from paper-based contracts and for good reason.
We’ve written a number of articles on this subject and the move from paper to digital. Has your business gone paperless or do you refuse to become a digital office? Let us know!
If you’ve never given thought to the value of analytics, the story that follows will prove to be a reminder of its worth.  The story concerns Oberweis Dairy in Aurora, Illinois.  Bruce Bedford, Vice President of Marketing Analytics and Consumer Insights for Oberweis Dairy, joins host Brent Leary to share the story of how analytics resulted in a 30% increase in customer retention.
* * * * *
Small Business Trends: Can you tell us a little bit about your background?
Bruce Bedford: I might have a bit of an unusual entry into the world of marketing. I actually began my career as an engineer. I have a PhD in Chemical Engineering. I began working as an engineer doing all sorts of design projects for large corporations. Then I made my way into the world of business and marketing after a couple of years of engineering work.
Small Business Trends: Can you tell us about Oberweis Dairy?
Bruce Bedford:Â Oberweis Dairy has a network of retail dairy stores where we sell fresh fountain ice cream treats, cones, mike shakes, banana splits and sundaes. We actually sell fresh bottled milk as well, and a wide range of other products. We have 47 stores located throughout the Midwest.
The second line of business is a home delivery business where all of those grocery items we sell in the retail stores can be delivered right to you door step. We do that generally on a weekly standing order basis.
Then, because we manufacture our own dairy products, we distribute those through a network of regional and national grocery store chains - places like Costco, Target, etc.
Small Business Trends:Â Lets talk about the in-store experience. You had a lot of folks coming in and the lines were backing out of the stores. How did you tackle that challenge?
Bruce Bedford:Â When the weather gets nice, the ice cream business really takes off. We observed people might stand in line for quite a while, but generally they were stuck behind a person who was looking at our menu boards trying to determine what appealed to them at the moment.
As we looked deeper, we realized we were exacerbating the wait time by having a menu board layout that wasn’t nearly as efficient as we might have liked.
We began a study of that problem to understand if there was a better layout we can produce with a goal of minimizing wait times. Immediately we determined reordering the ordering process flow would be beneficial. However, as soon as we started doing that, the concern came that in reordering the flow of the menu board, it is very likely that we can shift the product mix in such a direction that we lowered the average ticket value. We call it value for transaction.
We went through a pilot phase program where we tested a variety of designs for the menu boards. Through a series of analysis we determined there was one particular design that solved two problems. We were able to measure a decrease in wait times. And we were able to determine people were selecting items that increased the revenue per ticket.
With that insight, we redesigned the menu boards for all locations throughout the Midwest. We achieved a dramatic increase in profitability per ticket as well as decreased wait times. In fact, we found that one of the items that was not a large mover in the past actually increased by over 80%.
Small Business Trends:Â You went into this trying to improve the experience of the customer by decreasing their wait time in line, but also increased the revenue per transaction?
Bruce Bedford:Â Absolutely. That really highlights the power of an analytical approach.
Small Business Trends:Â You also did a program using your analytical approach to determine a way to build customer retention around your home delivery business?
Bruce Bedford:Â We maintain an old fashioned home delivery business where we deliver farm fresh milk right to the doorsteps of tens of thousands of homes across the Midwest.
For a company our size, there are some very large national competitors that distribute their products across the nation. Our focus of getting product out to customers’ doors on a regular weekly basis is very important. Once we obtain a customer, it’s critical that we are able to maintain that business over a long period of time. Simply because it costs quite a bit to acquire a new customer.
One of the most popular promotions for our sales team had been a free delivery offer. We deliver our products with a standard product price. The product price is the same whether you go to one of our dairy stores, or whether we deliver the products to your home. We compensate for the additional cost of delivery by charging our customers a modest delivery fee of $2.99 per delivery.
With the promotion, we historically waived that fee for six months. That is roughly 26 deliveries. What we discovered through a technique called survival analysis, was that the retention of customers who took advantage of that free delivery offer was actually not that great. In fact, we found out that at the six-month mark, customers tend to drop off at a fairly rapid rate. So we thought, what is going on with that six-month mark?
We realized if you consider the difference between the 26th and the 27th delivery for customers on one of those promotions, there is no change in value from their point of view. The only thing is that they are now seeing an increase cost of $2.99 from us. We thought, ‘What if we offer a promotion, but don’t create a scenario where there is a such a sharp contrast at that six month mark?’
We used the Valpak Blue Envelope Service to put out a couple of competing coupons and did a randomized AB test, where we sent a coupon offering the six months free delivery. The way that works is, it turns out to be about $100.00 worth of value. Because we also offer a free Porch Box with that promotion. That Porch Box adds another $25 of value to the whole offer.
We also created a second promotion that stretched the time of the promotion out to one year where we offer a $.99 delivery for one year, basically reducing the cost of delivery by $2.00 with each transaction. In the course of doing that, the headline still read ‘$100 savings.’  So the direct mail pieces looked very similar, with a little bit of difference in the construction of the offer.
We sent that out to two random groups. We found a statistically insignificant difference in response rates. Both coupons performed exactly the same when it came to receptivity. We tracked those customers in both groups for a year and found the retention rate for the group receiving the $.99 delivery offer retained at a substantially higher rate. Approximately 30% higher than the group receiving the free delivery for six-month offer.
Small Business Trends: It doesn’t sound like a huge difference, 99 cents versus free. But I guess you identified the bargain-hunters and as soon as they saw the “free†wear off they were out?
Bruce Bedford:Â We hypothesized that there is psychological effect happening there. Most people hate the idea of giving up value that they know they already have acquired. What we discovered is, if we can continue to have value hanging out there that the customer can claim, they would continue to desire that value.
The value of the program is the same in both cases, $100 savings. In the one example with the six month free delivery, you get all of that value in the first six months. In the second one, it takes you at least a year to claim that value.
What we hypothesized is that people are willing to stay around for a long time if they know there are additional savings to be had. By the way, a 30% increase in retention translates into millions of dollars in added value. The power of analytics has allowed us to unlock this.
Small Business Trends:Â Bruce where can people learn more?
Bruce Bedford:Â You can go to Oberweis, or visit us on our Facebook page.
This interview demonstrating the value of analytics is part of the One on One interview series with some of the most thought-provoking entrepreneurs, authors and experts in business today. This interview has been edited for publication. To hear audio of the full interview, click on the player above.
Security bosses need to make sure they are well prepared, and have the right business authority to act decisively during an incident.
Infosec 2013 saw a panel of experts discuss incident response, and what an organisation needed to put in place so they could respond the best way. Edward Tucker, head of cyber security and response at HMRC, said it was essential to have corporate top-level buy-in from the board.
"You need to effectively become God during an incident," he said of an organisation's head of security.
"Heads will run in all directions, both towards you and away from you. It's key that you are in charge and have the authority to coordinate the responses."
It's not just the security team that needs to be responsive during an incident - the rest of the business needs to be fully aware of what's going on to effectively respond.
Tracy Andrew, information security and compliance officer at Field Fisher Waterhouse, added that people needed to be aware of what an incident was and how it needed to be managed.Â
"If you in your team can't agree what an incident is, how are you going to communicate that to your staff?," he asked.
"Staff need to be aware of what to look for - email phishing, social engineering. It's about making sure the message gets in."
Vicky Gavin, head of business continuity and information security at the Economist Group, said that although they have tried innovative ways of raising staff awareness, ultimately they needed to be an extension of the security team.Â
She said: "They have to be able to identify when an incident is happening, ideally before it happens, or as soon as it happens so we can get involved quickly.
"We ran a contest last October where we ran a raffle, and to get a ticket to the raffle employees needed to forward a phishing or spam email they received. It was an extremely effective awareness exercise, because it forced people to internalise."Â
Security bosses need to make sure they are well prepared, and have the right business authority to act decisively during an incident.
Infosec 2013 saw a panel of experts discuss incident response, and what an organisation needed to put in place so they could respond the best way. Edward Tucker, head of cyber security and response at HMRC, said it was essential to have corporate top-level buy-in from the board.
"You need to effectively become God during an incident," he said of an organisation's head of security.
"Heads will run in all directions, both towards you and away from you. It's key that you are in charge and have the authority to coordinate the responses."
It's not just the security team that needs to be responsive during an incident - the rest of the business needs to be fully aware of what's going on to effectively respond.
Tracy Andrew, information security and compliance officer at Field Fisher Waterhouse, added that people needed to be aware of what an incident was and how it needed to be managed.Â
"If you in your team can't agree what an incident is, how are you going to communicate that to your staff?," he asked.
"Staff need to be aware of what to look for - email phishing, social engineering. It's about making sure the message gets in."
Vicky Gavin, head of business continuity and information security at the Economist Group, said that although they have tried innovative ways of raising staff awareness, ultimately they needed to be an extension of the security team.Â
She said: "They have to be able to identify when an incident is happening, ideally before it happens, or as soon as it happens so we can get involved quickly.
"We ran a contest last October where we ran a raffle, and to get a ticket to the raffle employees needed to forward a phishing or spam email they received. It was an extremely effective awareness exercise, because it forced people to internalise."Â
Infosecurity Europe 2013 saw security business leaders debate the value of proposed single European data breach laws, which might come in place if EU countries agree.
Daniele Cattedu, managing director EMEA at the Cloud Security Alliance said the draft legislation published last year was ‘very bad', and said that it was trying to force data breach laws and principles which were very difficult to apply.Â
"There are a number of points where regulators are trying to take the jobs of technical experts. There are statements which are crazy. Thinking about imposing a 24 or 48 hour time for reporting an incident just isn't right. It would be impossible to enforce."
Cattedu said companies were less willing to share crucial security information if there wasn't any trust, and that a voluntary rather than mandatory scheme would be much more effective.
However, Steve Wright, global privacy officer at Unilever, disagreed. Coming from a background where regulation was ever-present, he believed that left to their own devices, companies would stick their head in the sand.
"Coming from a position where I'm trying to get a board to invest millions of pounds in a programme, I need help, and personally, I welcome the legislation that's coming down,†he said.
"I've designed a whole strategy at Unilever around that new legislation. We're very much working on a timeframe where we need to be comliant by 2014. We'll be in a position to be ready for that new legislation. Fundamentally, there's something here about trust and transparency which I agree with."
Infosecurity Europe 2013 saw security business leaders debate the value of proposed single European data breach laws, which might come in place if EU countries agree.
Daniele Cattedu, managing director EMEA at the Cloud Security Alliance said the draft legislation published last year was ‘very bad', and said that it was trying to force data breach laws and principles which were very difficult to apply.Â
"There are a number of points where regulators are trying to take the jobs of technical experts. There are statements which are crazy. Thinking about imposing a 24 or 48 hour time for reporting an incident just isn't right. It would be impossible to enforce."
Cattedu said companies were less willing to share crucial security information if there wasn't any trust, and that a voluntary rather than mandatory scheme would be much more effective.
However, Steve Wright, global privacy officer at Unilever, disagreed. Coming from a background where regulation was ever-present, he believed that left to their own devices, companies would stick their head in the sand.
"Coming from a position where I'm trying to get a board to invest millions of pounds in a programme, I need help, and personally, I welcome the legislation that's coming down,†he said.
"I've designed a whole strategy at Unilever around that new legislation. We're very much working on a timeframe where we need to be comliant by 2014. We'll be in a position to be ready for that new legislation. Fundamentally, there's something here about trust and transparency which I agree with."
I read something in the paper recently about how an employer in an interview wanted to be “wowed†by an applicant.
Listen, I give a good interview. I’m a funny guy; I know what to say and I think I know my stuff. But if you want me to “wow†you. . .I don’t know how to do that.
So I took it to an extreme in this job interview cartoon.
Note: I don’t know why this guy wants to be made to feel sad at one point, but for some reason once I’d written that into the caption, I couldn’t take it out.
GFI Software has added a patch management capability to its GFI Cloud offering.
Delivered via an enhanced, web-based user interface, the company said that businesses will be able to automate the process of patching all of their machines and it can be bought and used on its own to complement other anti-virus, monitoring or asset tracking products a company may have.
Using the GFI Cloud, this will help IT administrators to automatically manage patches from Microsoft and third parties can be managed from the solution's single, intuitive dashboard.
Walter Scott, CEO of GFI Software, said: “GFI Cloud is our flagship solution for resource-strapped IT administrators at small and mid-sized companies to easily and efficiently manage the needs of their entire IT environment.
“The IT marketplace is shifting towards cloud-based solutions, and the benefits to them are already well-documented. GFI now extends the power and capabilities of our enterprise-class, award-winning business and security solutions to a single platform where all of these capabilities can be easily accessed and managed in one place by even the smallest IT teams.
“Patch management is the logical next step in the evolution of making GFI Cloud the only IT software platform a small or mid-sized business will need to manage the IT resources needed to support and protect their business.â€
As security budgets get squeezed in a time of austerity, companies need to seriously focus on education, training and awareness.
This was a key message from Infosecurity 2013, with IT bosses agreeing this was the best way to create good security without having to break the bank.
Graham McKay, CISO at Scottish publisher DC Thompson, said: "We are all facing considerable budget pressures, with an increasing threat landscape. It's a challenge.
"But we've adopted the approach of education, training and awareness.Educating our staff, getting the best value for money. Identifying what our information assets are, and taking the best approach to protect those."
Cal Judge, Head of Information Security at Oxfam UK, agreed that education was vital. He said that it was key to get staff interested in information security, and buy into it.
"You can do this through various methods," he said. "For us it is about for example, creating an online course that is entertaining and interactive.
"People don't remember doing boring courses, and if they are having fun during the process, they are more likely to remember."
Michelle Tolmay, security officer at online retailer ASOS.com, said all new starters in her business needed to undergo security awareness training.Â
She said that she checks their Facebook and Twitter accounts before they start, and reveals personal facts about them she discovers at the beginning of the session.
Tolmay said, "People start thinking, hang on, what have I actually put out there to find that information? We're quite lucky as most ASOS staff are customers.
"Not only do we make it personal because of how they need to protect themselves in their day-to-day lives, we can take that one step forward and show how customers of ASOS need to pr! otect themselves.
"Staff will take more interest because they know that if there is a data breach, it's not the information of random people around the world - it's theirs."
At Infosecurity 2013, external auditors were described as a threat to information security, ignorant of business strategies and only after the money.
Paul Simmonds, on the board of management at the Jericho Forum and formerly a CISO at Astra Zeneca, argued that external auditors caused problems to CISO's when it came to delivering a good security strategy for their businesses.
He said that as well as charging exorbitant fees, external auditors' motivations wasn't to validate well aligned strategies, but was more about making as much money as possible for the partner they worked for.
"That's how they get bonuses. It's for billable hours," stated Simmonds. "And it's a pyramid scheme. Every drone doing the audit makes money for their next level of manager, who makes their manager money.
"Ultimately the partner is up there making big bucks. That's how audit firms work. They make more money by charging you an exorbitant day rate for their audit fee, and send you fresh faced kids out of college with a pen and a checklist."
He said that auditors wouldn't understand a CISO's business strategy, because it wasn't in their interests.Â
"The auditor's interest is to train the fresh behind the ears drone, out of university, in how they do audits. It's a standard checklist that has no relevance whatsoever to your business."It's what flavour in the month in the press, or what has actually been around since the 90's, simply regurgitated every time they do an audit."
He went on to say that auditors 'are incentivised to find as many issues as possible with your company, irrespective of what the risk behind those issues is'. "They want you to sell you more expensive consultancy, and upwell you to fix these problems which have magically came up," he said.
He went on to say auditors were not incentivised to give praise to businesses that were doing a good job, leading to irrelevant audits and job losses of despondent staff angry with the company.
Marketing is a huge concern for all small businesses. Even if you have a great product or offer outstanding service, you’re not likely to succeed unless you can get your message out to consumers. To make matters worse, marketing is tricky because it changes so quickly. Traditional advertisements such as direct mail, in-print, radio, and TV ads are still used, but their popularity has diminished as society has become more electronic and internet-based. Interestingly enough, we’re also seeing changes in how advertising is done in the digital age. While businesses typically rely on email marketing and gaining business through their website, social media marketing offers new avenues to reach customers and build loyalty. A new study by Constant Contact illustrates the increased reliance on social media marketing,and the spread of marketing to a range of social media platforms.
Small Business Trends: Can you tell us a little bit about your background?