It is a sweet irony for me that my present company, Inbox Marketer Inc., has made the list of Canada’s Fastest-Growing Companies that I started 20 years ago as editor of PROFIT (then called Small Business). But in some ways, it isn’t a coincidence. I learned an awful lot from the many entrepreneurs I met and wrote about in those boom and bust years from 1986 to 1990. These men and women not only inspired me with what can be done; they educated me on the best ways of doing it. Now, I would like to share some of those lessons and how we’ve applied them at Inbox Marketer.
Make everyone an entrepreneur
This I learned from investigating profit- sharing and profiling a firm that was a very enthusiastic practitioner: Windsor Factory Supply. Being located in Windsor, Ont., it would have been easy for management/labour relations in that company to adopt an adversarial, unionized model. But the owners wanted something better. They contacted the Profit Sharing Institute of Canada and found a practical way of bringing a plan into their workplace. After interviewing owners and employees — some of whom, I discovered, had attended high school with me — it became very clear that a key benefit was communication. Profit- sharing got everyone on the same page.
Fast-forward two decades, and I have to say that implementing this wisdom was the most important thing we ever did at Inbox Marketer, as well as our biggest differentiator. When my business partner and I started the firm in 2002, it was relatively simple to give salespeople a stake in your success: you paid them a generous commission on top of a competitive base salary. Most of our direct rivals don’t do this, however, and pay their people straight salaries. The result is indifferent customer service. At Inbox Marketer, our high level of service sells itself, to the extent that we are the “cobbler’s son” that does very little marketing. Most of our customers came by referral, and most had incumbent vendors they weren’t overly pleased with.
Less simple was finding the formula to share our success with non-sales staff: our technology people, graphic-design folks and administrators. Finally, we geared profit-sharing to production and the volume of e-mail messages sent every month. All 25 of us are now on the same page — just like at Windsor Factory Supply — and that page is all about pleasing our customers.
Bootstrap, bootstrap, bootstrap
Inbox is actually the second company I started after leaving the print publishing world. The first was an Internet publishing service that we marketed to government contractors in the U.S. In some ways, it is probably the business model of what general publishing may look like in the near future. We aggregated content that contractors would pay for — public-sector tenders and bidding opportunities from all levels of government — and made it searchable through a website. We made certain that our content was the most comprehensive of any provider, then sold online subscriptions for $30 per month. The service easily paid for itself because it saved contractors many person-hours of looking for this information on their own. We eventually sold this business into the dot-com bubble about six months before it burst.
Despite the fortuitous timing, there is something I have always regretted about this experience: we took too much money too soon. On the strength of a business plan and some software programming, we managed to interest a group of investors and raise a good war chest for marketing. But this was the mid-1990s, so the Internet was still in its early days and there were few predictable business models. We soon fell short of the financial projections in the plan and settled into a protracted relationship with an increasingly disgruntled investor group that had no previous experience with technology companies. Managing such a relationship distracts you from managing your business, so we were all happy to sell when the time came.
When starting Inbox, my hard and fast rule was one I belatedly recalled hearing from many PROFIT entrepreneurs: bootstrap for as long as possible. My partner and I had no outside investors or creditors. In the first few years, that often meant writing personal cheques to cover payroll, forgoing family vacations and working the brutal hours familiar to most entrepreneurs. But the dividend that came later was complete mastery and control. Inbox is not only one of Canada’s Fastest-Growing Companies; it’s also debt-free.
The best form of marketing is teaching
At PROFIT, I spoke to numerous entrepreneurs who gave back to their respective communities. Often, this natural expression of the entrepreneurial personality took the form of education — which can be a great marketing asset.
Teaching is the ultimate soft sell, because it positions you as an expert without having to appear promotional. It can consist of anything from non-promotional speaking engagements to publishing your own industry newsletters. For example, at Inbox Marketer we teach three full-day marketing seminars for the Canadian Marketing Association (CMA) on advanced e-mail marketing, integrated online marketing and marketing math. We run each of them about three times a year, making it a win-win for us as well as the CMA, which collects seminar fees from the attendees. These seminars put us in front of the most qualified sales prospects possible — marketers in large organizations — and they have proven to be one of our best sources of new customers.
Regardless of which kind of teaching you do, the caveat is that it really must be teaching and not self-promotion. Here are three rules we follow:
- Never make the teaching about you, but about best practices in your industry. Our first presentation slide is a disclaimer to remind attendees that we’re not there to drum up new customers.
- Keep the content fresh and original. To reinforce the fact that you really are an expert in your field, make sure you deliver information that doesn’t seem hackneyed, clichÃ©d or out of date. And be well rehearsed.
- Inspire. Self-promotion doesn’t sell, enthusiasm does. If people sense a passion in you for your subject matter, that passion becomes infectious.
When in doubt, advance
The thing that struck me about the entrepreneurs I met at PROFIT is that none of them got there by being timid. Sure, they would calculate risks, assess situations, count cash, eye competitors, consult experts and do all the maneuvring possible to increase their odds of winning.
But in the final analysis, they would act rather than dither — because that’s why they were entrepreneurs. Intuitively, entrepreneurs know that they exist in a dynamic environment in which your choice is either to grow or to shrink — never to remain the same. Do they let a little thing like a recession stop them? Not likely.
Few industries move faster than the online world Inbox Marketer operates in. Although we began with e-mail marketing services, we soon found it necessary to expand our repertoire, adding Web programs, e-commerce, database hosting, analytics and online-marketing strategy. In every case, we simply listened to our customers and followed their lead.
What customers are telling us today is “mobile,” but this time we decided to respond differently. We launched a separate, wholly owned company called Mobi Marketer that helps companies execute marketing campaigns to mobile devices. Recessions are great times to launch companies, because recessions make big, established players timid — and most of Inbox’s competitors are large corporations.
And although Mobi Marketer is a natural line extension of what we do at Inbox, we decided not to add just another department or division for a couple of reasons:
- It harnesses the entrepreneurial drive of key employees. Starting a new company makes it easier to issue shares to people who have the highly specialized knowledge needed to make the venture succeed. That’s what appeals to the kind of people who appeal to us.
- A new company acquires a life of its own. One of the reasons Inbox is on the PROFIT 100 is that startups grow faster than established firms, and we happened to launch a bit more than six years ago. Startups have the energy of youth and the freshness of new ideas.
At Inbox, we’ve managed to preserve much of this energy and freshness by adopting many of the lessons that I learned from PROFIT entrepreneurs from decades past. But we’re also nostalgic. There’s really nothing like a startup to get the juices flowing. And this way, we have a shot at being back in these pages in another six years!
RANDALL LITCHFIELD was editor of PROFIT from 1986 to 1990 and has been a serial entrepreneur ever since. He is currently the president and co-founder of Inbox Marketer Inc., a Guelph, Ont.-based e-mail marketing services company that ranks No. 98 on this year’s PROFIT 100.