Potential clients often ask me—“Well, isn’t it all free on the internet?” The answer, of course, is yes and no. There is a great deal of free information out there, if you know where to look and how to interpret it. In the interest of letting you know what is indeed “out there” here are some free tools to get you started.
If you can’t afford Dun & Bradstreet for prospect lists give MANTA a try. Manta is a free tool that accesses many of the same data sources as Dun & Bradstreet and Hoover’s. It has access to information on both closely held and publicly traded companies, just type in your criteria or search by company name and you are good to go. The downside is that you can’t print the lists you pull. But, it is a nice tool to begin building your own prospect list. You can claim your own company on MANTA and make sure your own information is being accurately reported.
Linked-In has a search option which can be used to identify contact people within an organization. Go to the search tab and choose company, then hit the search button without entering a company name. Detailed search will show up on the left of the screen. Enter parameters and you will get a list of companies that meet the selected parameters. Zero in on a company and you will get a list of their employees who are on Linked-In, both inside and outside your network.
U.S. Census Data is available online, at the American Fact Finder. This is the official source for U.S. Census Data on populations, communities and economic trends. Tutorials in how to download the tables and access the information are available at the site.
ESRI collects demographic, lifestyle segmentation, consumer spending, and business data for profiling customers, analyzing markets, evaluating competitors and identifying opportunities. Although, there is a fee for software and reports, the Tapestry Segmentation page gives a unique perspective on the characteristics of a population in any U.S. zip code. Just type in the zip code and you will get some interesting demographics on that area as well as the top three lifestyle segmentation categories.
Freelunch.com is an excellent source if you want to get your feet wet in economic trend reporting. They have a number of free data series which you can view or download into Excel. This is general data used to identify trends, such as changes in unemployment by zip code. Their free data is pulled from other free sources, but it is nice to have them all in one place.
City Forward is another trend analysis tool that uses free data government data. Searches, called Explorations, are saved so that you can begin your search by building from what other members of the City Forward community have created. This is a good example of a tool that is traditionally used by city managers and Economic Development professionals, but has great potential for small business.
This is another crowd sourced application that pulls from the massive amounts of data that Facebook has collected. You can filter the data by a number of demographic and psychographic keys for customer analysis. The data is confined to data collected from FB, rather than the general population, but with close to 900,000 million FB users it is a robust source.
So there you have it. My top seven go to choices for doing business research for free on the internet. All it costs is your time.
beth plutchak consulting llc
business intelligence for the rest of us
You are probably familiar with the big five of demographic data: income, education, age, gender and race. The Census Bureau collects this data and makes it available by census tract. But, what if you have individuals with identical demographic stats who have very different buying habits? For instance, I live in a rural community, not far from Madison, WI. A woman who has my demographic characteristics, but lives on Madison’s Isthmus will have very different spending patterns than I do. Our different interests are evident in where we choose to live. In the Era of Big Data, companies are using psychographic data to dig deeper into spending patterns.
A few years ago my sister-in-law became a part owner of a Gymboree Play and Music franchise. The parent company offers demographic research to their franchisees, among other supports. Lynn and her partner flew out to California for training. They were given site selection help for opening their Alabama location.
Gymboree had quite a few locations in California, but few in the Southern United States, at the time. The new franchisees were given demographic information based on what had been successful for California franchises. Lynn and her partner located in a suburb with married couples of an age likely to have young children.
Demographics suggested that the higher the income and education of the parents, the more likely they were to spend disposable income on enrichment classes for their children. Since this is not a day care or a preschool, at least one parent needed to have enough leisure time to transport their child and wait for the classes to end.
In early 2010 sales for the Alabama franchise were not what they’d hoped, but the new franchisees did not blame it on the poor economy, they took a closer look at their customers. When their lease was up they moved location, based on experiences which did not match the parent company’s assumptions.
They found they had a large number of Hispanic clients whose demographics on income were lower than their original target. It turns out that parents in the nearby Hispanic neighborhood place a high value on family, children and enrichment. They were likely to spend more of their disposable income on children’s enrichment than neighboring non-Hispanic parents.
It would be a mistake to think that simply adding a demographic search by ethnic identity would tell the whole story. According the Hispanic Chamber of Commerce there are over twenty different countries and sub-cultures represented in Spanish speaking communities. Lynn and her partner needed to understand their core customers. Demographics alone are not enough.
One of the tools I use is the Tapestry Data tool supplied by ESRI. According to their website: “Tapestry classifies U.S. residential neighborhoods into 65 unique market segments based on socioeconomic and demographic characteristics.” For my customers, I am able to put together reports and GIS maps which give a clear picture of actual customer spending patterns. This information can be used for site selection and marketing, by companies that are not big enough to collect this kind of robust data on their existing customers. It can also be cross-checked with existing company data, to give an edge that helps with decision making. Play around with their free tool, which gives you a snapshot of what Tapestry results are for any zip code.
How well do you know your customers? What additional information would give you the competitive edge?
I recently attended a presentation by one of the former owners of the Penda Bedliner Company. Now, in order for you to understand his story you need to understand the meaning that the name Penda once had to pick-up truck owners. Personally, I used to think a car was just a car, a means of transportation, and that people who went on and on about their vehicle were just, well, silly.
At least I thought that until I bought my first pick-up truck. It was a lipstick red, Dodge Ram. It was not a girly vehicle, but then I’ve never been a girly, girl. I bought it the day I was promoted from Credit Analyst to Ag Lender. It symbolized my making a leap into a job which few women held and which I’d worked very hard to obtain. To my customers it symbolized that I was willing to work hard for them and get my boots dirty. Oh, and it was lots of fun to drive. (Do you know the big trucks rule? Big trucks rule!)
Once you make that emotional commitment to your pick-up truck the next thing you need to do is figure out how to trick her out. I spent hours poring over the accessories catalogs trying to decide whether I needed the practicality of sure grip running boards or the flair of ovals. It was next to impossible to pick between the tri-fold or the snap down tonneau cover. But, there was no question I had to have a Penda Bedliner. Penda’s were the best, and I wanted only the best for Alice. (Oh, yes, I named my pick-up truck).
Toby and Buckaroo Banzai in the Twenty-First Century
In 2006 pick-up truck sales hit a peak. They were not only being purchased by hard-working contractors and farmers, they had also become a recreational vehicle of choice. Accessories for working trucks needed to be practical, but most accessories for recreational trucks were for show. Dozens of new accessory makers entered the market and a funny thing started happening to the sales of Penda Bedliners.
New entrants to a market often try to gain market share based on price, and all the new producers deeply undercut Penda. Penda management expected sales to come back when people found out that the quality was not comparable. But, sales of Penda Bedliners never regained their former levels. Penda had run into a truism of consumer sales – sometimes the best cannot compete with good enough. The lowest price point did not capture the greatest market share. Consumers did want quality, but after a certain level of quality they were not willing to pay a premium.
The first question I ask companies is “What differentiates you from your competition?” If they answer “quality” I try to not visibly cringe. Customers have a minimum expectation of quality. Under that minimum they will not buy no matter how low the price. But, the range from the minimum to good enough is generally fairly narrow. Competition in that narrow band is fierce. True differentiation is something that you do that your competitors don’t, and that it would be very difficult for them to copy. What your differentiator is today may not be the same as it is tomorrow. It often needs to change if you want to stay ahead of your competition.
The team who owned and managed Penda at the height of market dominance, eventually sold out their shares of the company. The company still exists and if you do a Google search you find that they are repositioning themselves on their skill at custom heavy-gauge thermoforming. People still do buy Penda Bedliners, but the company is pursuing market share based on all of their strengths, and finding new ways to differentiate itself.
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Dan, my husband is what you’d call a detail person and I’m more of a big picture thinker. I usually get home from work before he does and a couple of years ago I listened as he pulled into the driveway. I heard the garage door go up and then a big Thunk. I waited a few minutes and then heard a string of language coming from the garage that I am not accustomed to hearing. At that point I went out into the garage to see what the heck was going on.
The motor for the garage door was hanging from the electrical cable, the fixture holding it in place pulled out of the ceiling. Dan came home from work and all he wanted to do was put the car away and close the garage door. Instead, he had one hand stretched over his head holding up the sagging rigging while he was reaching for an out of reach step ladder with the other. I pulled the ladder over for him and while he scrambled up it went in search of the duct tape.
A little later he scrambled down the ladder and while I yelled “No, no, no,” he went to close the garage door. What he hadn’t taken into account was the way the motor connected to the door itself. As soon as the door moved, it would move the whole system and the motor would no longer be stabilized.
Sometimes events are not made up of their parts, but are dependent upon the way the parts are interconnected. It is the same in business. The very skills that you need to deal with the day to day issues of running a business, both stand in the way of seeing potential long-term problems and impact those very problems in hard to predict ways. Not only that, the people who are the very best at the detail level are often hard-wired to be the worst at the big picture or system level.
Business management needs to be able to think sharply in a number of directions. They need to be able to put out the day to day fires of customer service, quality control, supply chain emergencies, what have you, all of this while being aware how these small decisions are impacting short and long term strategies and goals. Sometimes this is accomplished by making sure you have a good mix of personality types on your management team. Sometimes it is accomplished by making review of your goals and procedures a frequent recurrence.
Biologists like to say that change happens at the edge of chaos. That doesn’t mean that we as business owners can’t control those changes. It means we have to be ready to see the implications of all of our decision making at a moment’s notice, right when we are reaching over to close the garage door.
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I was a geek before there was a word for geeks. I got my high school letter in forensics, not the cool kind of forensics made popular by the CSI TV shows, but the kind that trained you for public speaking. I was president of the Latin Club. While other girls were trying out for the cheerleading squad I was translating the love letters of Abelard and Heloise. The odd girl with glasses. That was me. In the summer of 1962 I took a trip to the Museum of Science and Industry in Chicago and was mesmerized (does anybody but geeks even say mesmerized? just wondering) by the AT&T exhibit of the future phone where you could actually see the speaker on the other end. I was in love with computers when they were all as big as houses, although I never did get the hang of punch cards. I was a geek.
One of my early jobs in banking was to take part in a feasibility study for a regional bank that determined what kind of desktop computers to put in front of the loan documentation clerks. Up until then loan docs were produced on typewriters and there was one desktop computer for the whole department. We came up with two recommendations – IBM or NCR. These were the workhorses of business computing. The banking industry was heavily reliant on IBM mainframe processors and NCR provided the machines that read bank processed payment and credit card slips. We would never have considered a MacIntosh.
Although Apple is certainly innovative in product design, it’s real brilliance was that it sold cool to geeks. The geeks who bought Apple products were tech savvy, they were early adopters, they were in the know. The geeks bought ipods first and the cool kids followed them. Brilliant. The much promoted (by Apple) rivalry between Apple and PCs is built on an emotional appeal. What you pay a premium for when you buy Apple is the cool. Rebels, creative types, risk takers are the early adopters. What a way to protect a margin.
When I am out talking to companies and ask them “What do you do that is unique?” I often hear about customer service and quality. These are the attributes that customers expect at a minimum. I want companies to think about the things that they do that really differentiate them. Sometimes it can be hard to verbalize those things because they are so endemic to the owner’s vision and the company culture. Take a minute to think about it. What do you do that is unique to your business?
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Innovation is one of the key concepts behind the technical assistance associated with Economic Gardening Programs. Here’s a neat little picture to explain why innovation is so important to small businesses.
Conventional wisdom is that companies need to cut prices when their competitors do to maintain their sales. The more difficult strategy is to add value that you can charge a premium for.
My local grocery store did an expansion a couple of years ago, when the Super Walmart opened down the highway in Baraboo. Instead of dropping grocery prices they expanded their specialty selections and carried more higher margin items. The area is known for meats and cheeses. They carry a number of local specialty cheeses which have been branded as Opahle’s. They’ve expanded their authentic Mexican foods (we have a growing Mexican population) and their organic foods. They offer items in sizes that appeal to empty nesters that make up a large portion of their demographic, and best of all if there is something they carry you want more of or something you wish they would carry, they will get it in for you. Corporate chain stores just can’t do that.
What does your company do that differentiates you from your competition? Are you able to get the demographic information you need to make these kinds of business decisions?
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