National Small Business Week Interview: Constant Contact

Constant Contact seminar on social media for small businessConstant Contact will generate $250 million in revenue this year helping more than 500,000 small businesses, nonprofits, and associations use email, social media, surveys, events, and local deals to create and grow customer relationships. Among Constant Contact’s own customers are about 350,000 small businesses with fewer than 10 employees. Yahoo! Small Business Advisor customers can also benefit from Constant Contact’s expertise through a partnership that brings them into the Yahoo! Small Business Dashboard.

We caught up with CEO Gail Goodman on the same day Constant Contact was celebrating the hiring of its 1,000th employee with a company-wide breakfast. Goodman, whose new book, Engagement Marketing: How Small Business Wins in a Socially Connected World, hits bookstore shelves this the week, shared her unique insights about small businesses in the U.S. in this exclusive interview with Yahoo! Small Business Advisor.

How important do you think small businesses are to the overall economy?

Gail Goodman: Small businesses are a powerful growth and innovation engine because they are so close to their customers. They don’t need to wait for economic forecasts, leading indicators, or market indices to move. If they have the business, they hire to serve it, and if they don’t have the business, they don’t hire. Small businesses are the perfect bellwethers for our economy.

What are the three most important skills or traits a small business owner needs to succeed?

Gail Goodman: First is the ability to make real connections with customers, prospects, or clients. Great small business owners make those connections when they’re building their business to understand how they’re going to meet a need in the marketplace. And once they’re in business, they’re making those connections to turn prospects into customers, customers into repeat customers, and repeat customers into word-of-mouth referrals. That’s the golden cycle of a small business.

A second crucial skill is being a continuous learner about how to build your business. Be open and creative and willing to try things. The way you reach and engage customers is changing so dramatically. Half of America’s small businesses don’t have a website. But the way consumers discover and interact with businesses has moved entirely online and, in many cases, to mobile. Small businesses need to get there. They don’t need to be on the bleeding edge, but they’ve got to be open and creative in the ways they go to market.

Finally, it’s incredibly important for small business owners to know their business’s economic model. For instance, “These are the fixed costs of my business, so I need to make at least $X in revenue this month to be in the green.” Or, if you’re thinking of starting a small consulting business, you need to know how many clients you need in order to make your mortgage payments. Or, if you’re in a place with a physical presence and you have fixed costs in rent and staffing, how much business do you need to have and where are you going to get that business?

You would think these are numbers that all small business owners know off the top of their heads, but that hasn’t been my experience. I’m always surprised when I ask the question, “How much revenue do you need to generate every month to make a profit?” Most small business owners I meet stumble on the answer.

What single piece of advice would you give to a struggling small business owner?

Gail Goodman: Create a way to stay connected with your customers and your network. Whether you’re struggling or not, you have a first interaction with someone. Whether through a sales pitch because you’re hoping to win a new client, or when someone walks into your restaurant or store and makes a purchase, that’s the start of a relationship. You have a choice: You can let them walk out without making any attempt to stay in touch, in which case you’re counting on them to remember you, or you can make an attempt to make a connection—whether it’s asking them to join your mailing list or follow you on Facebook. My number one tip is begin building a network—a contact database that is your engaged audience so you can reach out to them and pull them back into your business.

For a classic business-to-consumer business, such as retail, restaurants, day spas, we focus on two channels: Facebook and email. I wouldn’t say don’t use Twitter, but I would use that to get into a different dialog. Facebook and email offer you a better chance to drive engagement. Twitter is a great vehicle for creating buzz in the press and your community, but it serves a different purpose.

If yours is a business-to-business company, I would add in LinkedIn and maybe substitute that for Facebook. But the email inbox is still the place where people engage most directly.

In the current economy what should a small business owner be focusing on in order to succeed?

Gail Goodman: Keep you current customers close. It is so much easier to get a current customer to come back and to refer others to you than it is to find that next customer. Particularly in this tough economy, it’s much less expensive to stay connected to your current customers than to reach that next one. That new success formula is all about what we call engagement marketing—it’s what my book is all about.

Relationship building doesn’t come naturally to everyone. What if you’re great at making cupcakes but not at networking?

Gail Goodman: What we would say to that great cupcake maker is, “Share your passion for cupcakes.” Something got you to start this business—an expertise or a passion—so share that. The great news is that, in this modern world, less is more. A picture or a sentence is all you need. If what you do is cupcakes, post a featured cupcake-of-the-week photo and invite readers to suggest next week’s cupcake. That’s engaging enough. On Facebook, ask them to fill in the blank: I crave a cupcake when… . You’d be surprised how much dialog that can get verses a well-written blog about anything. People will hop in. You don’t need to be Chatty Cathy. You just need to be willing to share a little bit of your expertise and passion.

The small business market is so diverse and decentralized. How do you keep your finger on the pulse of small businesses across the country?

Gail Goodman: We engage with more than half a million small businesses and we have over 10,000 one-to-one interactions with small businesses every day. We had over 1 million one-to-one contacts last year. We harvest the collective wisdom of our team’s interactions and we create many channels where small businesses can directly engage with us. We make it part of our mission to listen.

What do you hear small business asking for, that isn’t being supplied today?

Gail Goodman: We hear businesses continuously looking for great advice, such as, “What should I be doing more of or less of?” Many small businesses don’t know that there’s great advice for free right around the corner with SCORE. SCORE is one of America’s great treasures—these are 14,000 experienced business people who are volunteering their time to give back to small businesses for free. Getting a really smart person to help you think through what to do next is invaluable. I use mentoring as a way to grow my business, and I think small businesses are hungry for that.

How and why does your company help small businesses?

Gail Goodman: Constant Contact is 100 percent focused on driving small business success through creating and growing great customer relationships. Whether it’s finding that next great customer or bringing that customer back or encouraging word-of-mouth referrals, we do that through a suite of tools. We combine those tools with the know-how and coaching for success. Those tools are social media marketing, social campaigns, event marketing, email marketing, and now our great save local/do your own local deals product. All of them are designed with small business success in mind and all of them start free so that small businesses can build confidence and skills before they have to pay us.

National Small Business Week is the time we celebrate small businesses’ contributions to the US economy and culture, and the important role they play in our lives every day. Do you have a special message to small businesses in recognition of Small Business Week?

Gail Goodman: Constant Contact is honored to be partnering with SCORE to bring small businesses across the US free education coaching and mentoring around finding their next great customer.

My big message to small business is use this week as an opportunity to give yourself the gift of time to learn about and try something new that helps you build your business. Small businesses are time starved and task focused. Lift yourself up and give yourself the gift of learning and trying something new. Use small business week as your excuse for that.

For National Small Business Week, Constant Contact has partnered with SCORE to host free “Get Down to Business” events in 50 cities as well as a live Get Down to Business webinar on May 24. (Note - if you miss the live webinar it will be available later on demand).


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