1. Marketers focused on profits, realizing that every customer they bring into the business needs to represent value to the company. No more eyeballs for eyeballs´ sake.
2. E-marketing became part of an integrated multi-channel marketing and sales mix.
3. Pay for performance emerged as the right way to test risky new media options.

But what´s on the horizon for 2003? I polled some leading thinkers in the Internet marketing world to gather their thoughts.

Bryan Eisenberg, President of Future Now Inc.:
Technology is going to change the behavior of email marketers once again. I am talking about the new spam control technologies and the release of Outlook 11, which will block HTML bugs. Marketers will have to focus on using email to deliver value, develop a genuine dialog with their customers and create real relationships. Marketers will move beyond mere transactions and promotions. You can only scream “SALE” so many times before you are simply ignored.

Bob Bly, Copywriter/Consultant:

People have finally realized that an e-mail alone is NOT the electronic equivalent of a direct mail package. It´s the e-mail PLUS the landing page that comprise the mail package equivalent.

Therefore, when people say long copy does not work, they are talking about the e-mail only. A discussion of copy length should include both the e-mail AND the landing page. And numerous tests over the last year have proved that, in the e-mail/landing page combo, long copy works for many products and offers.

Debbie Weil, Publisher, WordBiz Report:

Email marketing, including e-newsletters, will continue to be a vital piece of the integrated marketing mix. But publishers and marketers will have to be even more careful about the quantity and quality of messages they send.

With spam literally zooming out of control, people are exquisitely sensitive to the contents of their inboxes. Email them too frequently and it´s intrusive. Not frequently enough and they may no longer remember “opting in” to your communications.

Add to this the technical obstacles of getting legitimate emails delivered through the spam filters and blacklists, and you´ve got an even bigger challenge. It´s ironic. Email was heralded as the killer app of direct marketing. But the very speed and ease with which email can be deployed is contributing to its downfall as an effective marketing tactic.

Sandra Barry, Director, Marketing Fuel:

I see two trends emerging. First, companies are going to figure out that they need to develop guidelines and standards for email use in different areas of the business, from marketing to customer service and fulfillment. It´s no longer sensible to run email on an ad-hoc basis here and there, without a coherent strategy enterprise-wide.

Second, it´s my hope that companies will invest the time and energy required to develop customer contact strategies, and integrate their email communications with them. Companies who still operate in physical or cultural silos tend to view customer data as proprietary to each group, without realizing that, from a customer perspective, the brand is the brand. The best way to crack this nut is by creating cross-departmental marketing teams.

Larry Chase, Publisher, Web Digest for Marketers:

The hot ticket items online are still email marketing and search engine marketing. In my neck of the woods, the successful email newsletter publishers are those who look at themselves and their business like their counterparts in the print newsletter arena. What this means on a practical level is:

• Learning how to put a dollar value on each subscriber. How else can you know what to spend to acquire a new subscriber profitably?
• Test to see which ancillary products sell best and at what price.
• Figure out how best to generate revenue from list rental. There are plenty of options, each with its own pros and cons.

Jim Novo, The Drilling Down Project:

1. 1. Onliners will realize that new-customer source plays an enormous role in understanding customer value. They will start tracking it, just as offline direct marketers have done for decades. Onliners will begin to understand that not all traffic is created equal, and that where the visitors come from is a key indicator of their future behavior.
2. Web analytics will take its place in driving website productivity. It is shocking how many companies have the software but either don´t use it or don´t look at the reports because they are full of geek-speak. The key is to set up the reporting to provide actionable information, not just data.
3. Marketers will understand that customers don´t want a relationship; they just want great service, interesting products, and sharp pricing—just as they always have.

Al DiGuido, CEO, Bigfoot Interactive:

• Automated email-based solutions, such as payment confirmations, billing alerts, and other triggered communications tied to individual profiles, will help marketers maintain a relevant dialog while driving dramatic efficiencies.
• Strong ISP relationships will be critical for reputable email providers as they join their ISPs in fighting spam.
• Marketers will leverage the power of email beyond corporate marketing and extend it to the local level. Distributed campaign management will improve sales and ROI while maintaining the integrity and relevance of the communications.

Reggie Brady, Reggie Brady Marketing Solutions, LLC:

To me the “new idea” is multi-channel marketing, but from the much narrower focus of a tighter integration of email and phone. I´ve seen several marketers work this way, with some very telling results. People who receive an email and then call the 800 toll-free number in the email spend more than people who just link through to the web site. It makes sense; a good call center rep—armed with a transactional history on the customer—can cross-sell and up-sell the consumer during the course of the call. Armed with this finding, some savvy marketers are highlighting and promoting inbound calls in their emails.

John Ardis,, Vice President, Corporate Strategy,ValueClick, Inc.:

The best New Idea for 2003 is the Old Idea, namely, a return to direct marketing basics, the fundamental principles that have been time-tested and proven over decades. With the advent of the Internet, marketers were first infatuated with the technology, and then with pay-for-performance. The next step is to move to a balanced, integrated approach to Internet sales and marketing.

It´s a return to understanding that there are no short-cuts, and that true success is striking the optimal balance between cost-effectiveness and volume.

It´s a return to the hard work but great satisfaction that comes from developing hypotheses, designing tests around them, reading the tests, and then refining and rolling out.

It´s a return to a mature approach to direct marketing, one that weighs long-term potential at least equally with immediate-term gains.

In short, it´s a return to classic direct marketing.

Thanks much to a bunch of smart people for sharing their views.

Ruth P. Stevens consults on customer acquisition and retention, and was recently named one of the 100 most influential people in business marketing, by Crain´s BtoB Magazine. Reach her at www.ruthstevens.com.

By Irwin Speizer

Thomas Jefferson fancied himself an inventor and innovator, and he wasn’t bad with a quote.

Here’s one: “I have sworn upon the altar of God eternal hostility against every form of tyranny over the mind of man.”

Jefferson, who had to write by candlelight, might appreciate how the citation is displayed today carved in a band under the dome of his memorial in Washington and illuminated with energy-efficient light-emitting diodes manufactured in a high-tech clean room in Durham.

Consumers aren’t likely to recognize its name, but electronics manufacturers worldwide know Cree Inc. as one of the top three or four sources of LEDs used in everything from traffic signals to message displays on wireless telephones.

About 58% of Cree’ís revenue in the fiscal year ended June 2002 came from LEDs. But there’s more to Cree than light, though describing some of its products is about as easy as catching beams from an LED.

For one thing, the mix is changing, testimony to the company’s commitment to research and development. Cree expects 70% of this year’s sales to come from products it developed or invented in 2002.

While the new products include LEDs, Cree also develops and makes devices from its patented process for fabricating semiconductor wafers from silicon carbide and gallium nitride.

They’re used in power transmitters and in lasers for next-generation DVD recorders. It also makes silicon carbide crystals, which look and feel remarkably like diamonds, for the gemstone and jewelry markets.

And Cree is working on new LEDs that will be bright enough to compete with light bulbs.

What sets Cree apart from many research-oriented companies is its unflinching focus on the bottom line.

Its research engineers work beside production workers, doing double duty finding ways to squeeze costs and increase efficiency. “We are a company that understands how to take fairly immature technology and put it into high volume and make money at it,”

President and CEO Chuck Swoboda says. ”If you think about it, traditional manufacturing companies aren’t considered very innovative. R&D companies aren’t very good at making things and making money at it.

We are an R&D company that has an unbelievable focus on making a product and selling it and making money at it.”

All of which are reasons why Cree is Business North Carolina’s High-Tech Company of the Year, presented by the magazine and KPMG LLP. At a time when slow sales, layoffs and cutbacks are the norm for high-tech companies, Cree got through the 2001-2002 slump without reducing employment and, though it lost money last fiscal year, it has surged back.

In its second quarter, which ended in December, it grossed .7 million, a 16% increase over the same period a year earlier, and netted nearly million.

For its first half, it grossed .5 million, up 25%, and netted .9 million ó compared with a million loss for the same period the previous year.

“They seem to have weathered the storm well,” says Jim Nichols, one of four judges and until recently the N.C. Commerce Department’s manager of electronics and information-technology development.

Jeff Reid, executive director of the Center for Entrepreneurship and Technology Venturing at UNC Chapel Hill, notes, “The percentage growth they had was phenomenal at a time when most high-tech is not doing well at all.

I believe their technological innovation has been a key to their success. They keep producing a product that companies want to buy.”

“They’re a technology leader and have shown a commitment to that by reinvesting a significant percentage of their revenue back into research and development,” says Jim Davis, senior vice president and chief marketing officer of Cary-based SAS Institute, last year’s winner.

“Their innovation, backed by a solid vision, has transitioned them from pioneer to industry leader.” Adds David Kinney, the fourth judge and BNC editor-in-chief and publisher: “Not only that, but a world leader born in our own back yard.”î

The judges selected Cree from the annual ranking of top tech companies that KPMG compiles. “This has been a difficult year for many businesses, technology companies included,” says Brad Hurrell, the partner in charge of the the list, which Cree capped.

After all, the tale of how Neil Hunter, his brother Eric and a trio of scientists from N.C. State University turned a scientific breakthrough into a manufacturing company already is legendary in Tar Heel tech circles.

Neal Hunter was a 25-year-old engineering graduate working in his first real job as an equipment salesman when he teamed with his brother, Eric (also a State engineering grad), to put scientific research they had encountered at the school into production.

They recruited three scientists from N.C. State who had figured out a way to successfully fabricate silicon carbide wafers, which must be produced at temperatures above 3,500 degrees ó heat so searing that controlling impurities and defects is nearly impossible.

Even microscopic defects or impurities ruin semiconductor wafers. In many ways, silicon carbide is considered a superior material for semiconductor uses than plain silicon because it can withstand higher temperatures and operate at higher power.

In 1987, with patent licenses from State for the new silicon carbide techniques, Hunter and his brother maxed out their credit cards and took out second mortgages to raise about 10,000 for the startup.

“It just seemed like the thing to do,” Hunter says. Yet, “there was always at least one person on the team saying, ‘We can’t do this. This is nuts.’

Fifteen years later, the company has about 1,000 employees and its stock, even after the economic slowdown, has a market value of more than billion.

Cree has managed to grow without taking on debt, financing its expansion with a combination of stock offerings and reinvestment of earnings.

“Cree has always been cash-flow positive,” says Jim Reed Jr., an analyst with Reed Global Advisors in Bellevue, Wash. “They have been smart with their money.”

Lately, Cree has been cashing in on the wave of new hand-held wireless devices that use LEDs for their miniature monitors. While most of the telecommunications industry is struggling, the one thing that is selling briskly is the mobile telephone with a tiny color monitor ó a device that uses LEDs.

Ram Kasargod, analyst with Morgan Keegan & Co. Inc. in Memphis, says one of Cree’s greatest achievements has been to prove that it can go toe-to-toe with Asian manufacturers and come out the winner in a commodity market. Cree’s fiercest competitor for LED sales is Japan’s Nichia Corp.

And there are more coming. “One of the concerns is, can competition from Southeast Asia impact Cree?”

Just how competitive and tough are Cree and its boyish-looking, 36-year-old CEO?

One of the companies it battles is San Jose, Calif.-based Lumeleds Lighting, which has as its director of sales and marketing one Mark Swoboda, who helped his younger brother land his first high-tech job at Hewlett-Packard, which later spawned Lumeleds.

Chuck Swoboda is repaying the favor by trying to snatch away Lumeled’s business. “Itís a good, healthy sibling rivalry,” he says.”Of course, I want to be winning.”

Mark Swoboda, the only other boy among six siblings, is a decade older and recalls his younger brother constantly hanging around and wanting to emulate him.

Their demanding father, the sales manager of a plumbing-and heating-supply company, stressed the importance of education and achievement and let the younger kids know each was supposed to try to surpass the one who came before.

“Our dad was always about taking responsibility,” Mark Swoboda says. “But he did it in a subtle way, always wanting us to take on more responsibility and be goal-driven. That’s what started it all.”

Their house in the Chicago suburb of Waukegan sat on an acre lot, and when mowing the lawn fell to Chuck, he quickly came to understand that he had to cut the grass precisely the way his old man wanted.

His brother recalls Chuck finishing the job, deciding it wasn’t quite right and running the mower over the whole thing again.

The real push for achievement came in local schools, where Chuck was the fifth Swoboda to pass through. “Just about every teacher I ever had had always had one of my brothers or sisters before me, and they always told me how good they were.

It was always a goal to do better. There was that natural inborn rivalry of a family unit.”

Mark Swoboda was the first in the family to get a college degree. When it came his turn, Chuck followed Markís path to the engineering program at Marquette University in Milwaukee.

He was still working on his bachelor’s in electrical engineering when the Hunters founded Cree. After graduating in 1989, he again trailed Mark, this time to Hewlett-Packard in San Jose, Calif., where he was hired to do marketing with an emphasis on engineering.

His little brother, Mark recalls, quickly established himself as not just bright and driven but someone who delighted in taking risks and doggedly pushed new concepts and products. One that he stumbled upon was a new way to use LEDs in mobile telephones.

He managed to get Motorola interested, which led to the first generation of its flip phones with an alphanumeric display. “It was a custom product and it was high-risk,” Mark recalls, “but the return was very good for H-P.”

In 1993, Cree went shopping for a product manager to run its blue LED production. When it hired Swoboda, the company had about 30 employees.

His workaholic ways and detail-oriented management style complemented Hunter, the self-styled company visionary.

Swoboda was promoted to president and chief operating officer in 1999, taking on much of the day-to-day operations. When the high-tech slump hit in 2001, Hunter stepped aside as CEO in favor of Swoboda.

In high-tech terms, it was a move toward youth and vitality. Swoboda was 33; Hunter, who still serves as executive chairman, was 38.

Under Swoboda, Cree opted to ratchet up R&D spending, from million in 2000 to .2 million in 2002, shifting jobs out of manufacturing and into research instead of cutting the employee head count.

It was an expensive move at a time when Creeís sales slipped along with the rest of the high-tech industry.

In the company’s fiscal 2002, it recorded a net loss of .7 million, following a profitable fiscal 2001, when net earnings totaled .8 million.

But when sales and earnings rebounded in the first half of fiscal 2003, in part due to some of the new products that Cree’s researchers had developed, Swoboda got instant vindication.

The companyís performance even converted skeptics such as Reid, the analyst. “I had a sell rating on the company for a long time.

I thought they were way overvalued. Then, in these last two quarters, they really hit their stride. I am becoming more of a believer.”

Still, Cree continues to operate in a very narrow market, which makes it vulnerable if something happens to one of its customers.

In 2002, 64% of revenue (excluding government contracts) came from five customers who primarily buy its LEDs. That percentage is likely to increase.

On April 1, Cree announced that one of its big five, Japanís Sumitomo Corp., had agreed to buy million of Cree LEDs through June 2004. It is Cree’s largest deal ever  more than four times what Sumitomo purchased in the 2002 fiscal year.

Swoboda understands that the company’s long-term health depends on broadening its customer and product base, which means finding another high-tech hit in its group of newer products.

He likes each of the emerging products ó the DVD laser, the amplifiers and the rest ó and ticks off, like some sort of marketing mantra, the advantages each can offer customers: more efficiency, higher capacity, lower costs.

But the key to the company’s growth might well lie in that subdued lighting found in the Jefferson Memorial, which only hints at the potential for LEDs in general-purpose lighting ó a -billion-a-year market.

Much of todayís lighting still uses the incandescent bulbs that Thomas Edison invented more than a century ago. LEDs use far less energy, put out less heat and last longer. The trick is to find ways to make them bright and cheap enough for general use and to sell homeowners and businesses on installing LED fixtures.

Analysts agree that a major shift may be coming and that Cree is one of the companies that will be battling to be a leader in that change.

There’s no guarantee, of course, that LEDs will be the technology that takes over. But if Cree’s gambit succeeds anything like that of the original blue and green LEDs that launched the company, the potential payoff is vast.

Millions, even billions, of dollars of new business is what Swoboda is hoping for. After all, making money out of research is what Cree has always been about. “I think what the founders of this company understood was that the only reason to work this hard at something is if you turn it into a real business.”

Those words might have sounded strange coming from Jefferson, who delighted in dabbling and died deep in debt, but they serve as a guiding light for Cree.

This article originally appeared in the May 2003 issue of Business North Carolina.

Profiles of business owners respected in their industry appear in our newsletter and are available on our web site. We encourage association executives to tell us about their members who are leveraging their inherent advantages (trusted brand, excellent service, etc.) by embracing a “doing it right” attitude into their strategy for growth.

By Jamie Swedberg, Industrial Fabric Products Review

Think a company´s fortunes have to rise and fall with the local economy? Rubbish, says O´Brian Mfg.

With its tin-roofed houses, fragrant pine woods, and abundant barbecue joints, Wilson, N.C., still evokes images of the Old South. But O´Brian Mfg. Co., an industrial-fabrics firm located just off Highway 301 north of town, has a firm grasp of the new economy.

Originally founded to serve the state´s then-burgeoning tobacco industry, the company has responded to changes in the local business climate by branching out into broader territory.

It was 1961 when Withrow O´Brian started making truck tarps for North Carolina´s farmers. At the time, tobacco was the state´s primary revenue source. Even then, though, the industry wasn´t a perfect moneymaker for the brand-new company.

His son Woody, now chief executive officer, says business fluctuated with the vagaries of farmers´ fortunes. “One year, a cotton or tobacco farmer would have a really good year and order plenty of tarps. Then the next year it wouldn´t be good at all, so we´d be stuck standing there with nothing to do,” he says. “That was one of the reasons we switched.”

O´Brian still serves local farmers by making hand tarps and covers, but the company has widened its scope. First, it added commercial and residential awnings to its repertoire. It also diversified into compactor curtains, or “diapers,” for garbage trucks.

Then one day, a friend of Winnie O´Brian—Woody´s wife and the firm´s chief financial officer—suggested that the company ought to design automatic tarp systems for the waste industry.

The O´Brians took up the challenge, and the rest is history. A couple of decades later, automatic tarping systems make up 80 percent of their business, and they reckon that their company is the second-largest U.S. manufacturer of the systems.

The tarp-system units are simple in construction, but inspired in engineering. A giant pair of hydraulic arms unrolls a tarp from the back of the truck cab to the end of the container, neatly covering the cargo.

Drivers don´t need to risk injury by climbing all over the truck to attach the tarp; they simply operate a joystick. The O´Brians tout the systems as being versatile—they cover anything from a 10- to a 50-cubic-yard container. And they´re also easy to maintain, they say, since their hydraulics are enclosed and the arms rest below the level where they´re likely to get crunched by a container.

Having made significant inroads into the rubbish market, Woody says his company is tackling the dump-truck market, too. “We´re pretty much into covering and containment,” he says. “As long as it falls under that, we try to get into it, but if it doesn´t, we try to stay away from it. You don´t want to get too diversified.”

It was this series of changes that spurred the company´s explosive growth—from just a few family members to 31 employees in two facilities—in recent years.

Now, with its cavernous warehouse and cheery clerical staff, the firm resembles any number of other medium-sized industrial-fabrics companies. Still, it´s a little unusual at its core, and that may be one of the keys to its success.

Let the four winds blow

A loud jingling sound, like a behemoth bicycle bell, shatters the relative quiet of O´Brian´s 22,500-foot main facility. It´s the end of break, and a seamstress tucks a bookmark in her book and returns to work.

It´s a scene you might glimpse in hundreds of sewing rooms all over the country. Except for one small detail: The woman is only visible from the waist upward. The rest of her is concealed in a concrete foxhole in the middle of the floor. A glance around the room reveals several more foxholes, each outlined with yellow-and-black warning tape.

Sean O´Brian, Winnie and Woody´s 26-year-old son and the company´s sales and technical point man, explains: “A lot of other places have to build up tables around the sewing machines. But when we built this shop, we decided where we wanted the machines and just put holes in the floor.” The result is that the floor acts as one giant sewing table.

Overall, the O´Brians have been happy with the innovation. According to Woody, it´s a lot easier for seamstresses to feed large tarps through the machines when they don´t have to hoist them over the edges of tables.

The system certainly frees up a lot of room to walk, and the building contractor´s initial fears of a leaky foundation have proved groundless. There is one drawback, though, Woody says. With a typical wooden table, a coating of silicone spray can render the surface extra-smooth for easy fabric movement.

With the foxhole system, a friction-free surface might translate into shop-floor accidents. “We kind of had to play with this,” he says. “You can get the floor slick up to a point, but once you pass that, then you run into a danger of someone falling down.”

The foxholes aren´t the only evidence of inventiveness in this shop. In an adjoining room, separate from the squeaky-clean sewing area, the shop´s dustier, greasier operations take place.

Fourteen-foot-high garage doors allow “anything that´s street-legal” to be driven in and fitted with a tarp. Here, too, awning frames are welded, products are developed, and boxes are shipped. In one corner, traumatized truck tarps are dragged in for repairs, facilitated by another clever invention—a long, skinny light table. “A lot of people do repairs on the floor,” Sean says. “But Woody designed and fabricated this, which shows any and every hole in the tarp.” For ease of use, there´s a metal roller attached to the long side of the table.

“You just hook the tarp up to the roller, and roll the truck top as needed. There´s a little rotary switch in the back,” Sean explains proudly.

It wasn´t always this way. Until 1998, the entirety of O´Brian Mfg. was confined to a 15,000-sq.-ft. space across town, crowded with tables, equipment, and people. But in November of that year, the firm opened its brand-new, custom-built facility off Highway 301 and turned the smaller building into a metal-fabrication shop for its automatic tarping system frames.

It turned out they made the change just in time for Hurricane Floyd, which immersed the metal-fab shop—but not the main facility—in seven feet of water. The storm KO´d many neighboring businesses, but it only inconvenienced O´Brian; it turns out the metal-fabrication equipment was surprisingly resilient.

“All our hydraulic suppliers were really, really helpful,” Winnie says. “They told us to pull the plugs [on our hydraulic equipment], drain all the water out, and soak it in a bath of hydraulic fluid. It was recoverable.” The welders received the same treatment, as did a waterlogged forklift.

The only major casualty was a plasma table (a piece of equipment that cuts steel by generating electrical arcs) that racked up a massive repair bill; yet even that had a silver lining. “The table hadn´t run that well up until that point, and now it´s never run better,” Sean says, laughing.

Like father, like son

“I started working summers with dad when I was in school,” remembers Woody O´Brian. “After I graduated, I moved to Durham and worked at an accounting firm for a couple of years. Then, at my mother´s persistence, I came back and started working at the company.”

That was in 1974. He´s stayed ever since, and says his venture into the outside world helped him learn to work for others without any special treatment.

Good thing, too, because with the entire nuclear family on site, the O´Brians go out of their way to maintain a businesslike dynamic. No one seems to use the words “Mom” or “Dad,” let alone a term of endearment, at the office; it´s first names for everyone. It´s all part of keeping things running smoothly, Woody says.

“Winnie and I, we´ve always put it down to trying to keep the marriage relationship separate from business,” he explains. “We play out the business roles when we´re at work, and then when we leave work, we take up husband and wife roles. When you get home, you try and talk about other things.”

He says family members also stake out their own territory at the office, and rarely see each other during the day. That helps, he points out, when family resemblances kick in. “It´s just that he and I are so alike in so many respects,” Sean says, agreeing with his father.

“Sometimes we can work together fine, but other times, after about five or ten minutes we need to go work on different things. We´re so near alike, we just get on each other´s nerves.”

Father and son share a love of design and engineering. If left to their own devices, they say, each would while away the day puttering with new prototypes for the company´s automatic tarping systems.

They´ve even created a faux truck bed—a steel frame on blocks—in the warehouse, ready to be fitted with new pieces of machinery. “We get feedback from the end user on different products,” Woody says. “And so I guess that´s my small expertise. I´ll come back and visualize it and design it on paper, then do a prototype. Then we put it in our research department and test it, improve on it, redesign it, and get it ready for the market.”

Sean´s the same way, and has taken the design process one step further by mapping ideas out in DataCAD, a computer-aided design software package. And right now, he says, he´s got the ultimate in hands-on jobs: One of the company´s welders is out with a bad back, so Sean has volunteered for machine-shop duty for the next few weeks.

“Of course, while you´re doing all this, you still have the day-to-day activities of running the business,” sighs Woody. “You´ve got to stop whatever you´re doing and talk to the customer that wants to talk to you. Or you´ve got to talk to the two plant managers and make sure things are getting done at both locations.”

Nevertheless, both he and his son insist that they´re not as comfortable in front of customers, and would rather leave sales to the salespeople. They´re always ready to help clients in need, but their favorite activity is research.

Sean, with typical youthful enthusiasm, carries over his favorite aspects of work to his leisure time. His father points to a truck body wedged on top of a storage unit in the warehouse. “This is what he likes to do—he´s building a vehicle from scratch for four-wheeling. He built a chassis, and he´s going to put that body on it.”

Woody´s leisure pursuits tend more toward escapism. Back in the days when Sean was a Boy Scout, Woody developed a love of kayaking, and continues the activity to this day. “When you´re paddling whitewater, you can´t think about business,” he says. “If you do, you turn over and you get wet. So it keeps your concentration, and it keeps your mind off work.” Winnie, he says, prefers to sit outside the family´s beachside trailer, engrossed in a book.

Far afield

In the company boardroom, Sean waves a hand in the direction of a large U.S. map studded with thumbtacks. “We haven´t updated it in a while, but all the pins you see here are our dealers,” he says. “There are more in the Midwest now than we´ve put in.”

The automatic tarping systems, he explains, are sold throughout the United States and via one dealer in Canada. Winnie adds that recently O´Brian Mfg. set up a dealership in Venezuela to supply tarping systems for dumptrucks, and it´s struck a manufacturing agreement with a company in the United Kingdom.

“We take care of the local stuff here,” Woody says, referring to the truck tarps and awnings his company sells in North Carolina. “But [for the automatic tarping systems] we need a dealer in the customer´s area to provide good service to the customer.” The dealers are encouraged to provide full installation and warranty service to buyers, he says.

“What we send out is actually something in kit form,” Sean says. “They´ll get all the parts with the instruction manual, and possibly an instructional video if they´ve never done one before. In addition to that, they can call us if they have any problems, and we can walk them through it.”

Service, quality and consistency, Woody says, lie at the core of the company´s reputation. That´s why an ISO 9000 certification is on the agenda for late summer. “We´re getting excited about it, the closer we get,” he says. “I think it´s something that´s coming down the road, that everybody will be required to do if they´re going to do business with the big companies. We like to think we´re ahead of the game on that.”

He adds that the firm is also concerned with providing a safe and pleasant work environment. That could be why, even though the entire O´Brian clan has just returned from a week away at a conference, none of them appears stressed out. Apparently, the business hummed along like a finely tuned machine while they were gone.

Woody shrugs, taking it as a matter of course. “You´ve got to look after your employees, and then your employees will look after you,” he says, smiling. And then he quietly slips back into the warehouse to continue his work.

Reprinted from April 2001 issue of the Industrial Fabric Products Review, with permission from the Industrial Fabrics Association International.

By Jamie Swedberg

O´Brian Manufacturing can be reached at http://www.obrianmfg.com.

Profiles of business owners respected in their industry appear in our newsletter and are available on our web site. We encourage association executives to tell us about their members who are leveraging their inherent advantages (trusted brand, excellent service, etc.) by embracing a “doing it right” attitude into their strategy for growth.

The retail environment poses many customer-relationship challenges.

High employee turnover and one-time customers are just two of the hurdles facing retailers trying to implement customer-centric strategies.

But one Connecticut-based clothing retailer is overcoming these obstacles using one-to-one principles to boost its share of customer and keep its Most Valuable Customers (MVCs) coming back.

Serving an upscale customer base of professional men and women, Mitchells is a million family-owned business with locations in Greenwich and Westport, CT (The Greenwich store, acquired in 1995, goes by its original name, Richards.)

The company´s database tracks each of its approximately 150,000 customers´ personal data and preferences, including size and style, as well as SKUs bought and prices paid since the tracking systems were installed in each store.

In fact, chairman and CEO Jack Mitchell personally keeps at his fingertips information about his top 1,000 customers. To use his favorite metaphor, the secret to Mitchell´s success is “hugging” the customers.

“I remember meeting one of the country´s top retailers on the runway at an Yves St. Laurent fashion show and he asked me, ´How are your outerwear sales?´” says Mitchell.

“I couldn´t believe he was asking about outerwear sales. My question was, ´How are your upper-end customers buying? Are they very satisfied? Are they coming in more or less frequently?´

He was product focused and I am customer focused. To us, it´s customers first and then the product—of course we search the world for the best product for each customer—and then the rest usually takes care of itself.”

This customer focus is a mind-set, he says, from when his parents started the business in Westport in 1958.

Today, there are nine Mitchells in the business, including Jack´s 97-year-old father, who started it all. “Every one of us makes a major contribution,” Mitchell says, “and they all have the same mind set; it has been and always will be customers first.”

Thirty years of data

In the 1970s, the company began tracking its customers´ purchases by category (suits, shirts, etc.) using an IBM AS 32 and then the AS 34.

The spotlight went on for Mitchell back in 1989, when he and his son Russell purchased the company´s IBM AS 400 and decided to track customers´ purchases, not only by category, but by actual stock keeping unit (SKU).

“When Russell and I were looking at the system, someone from a marketing firm asked us if we knew as much about our customers as we knew about our inventory,” he explains. “We realized at that moment that we didn´t…and then the light went on! We decided the whole system would be architected around the customer and then on what the customer bought.”

The changing retail scene also showed Mitchell that he was moving in the right direction.

“Two decades ago, people liked to go shopping. They were getting a reasonably decent level of service and they enjoyed it,” he says.

“Then the service dried up, and owners didn´t know how to get the customers back. We´ve learned that the most important [assets with regard to building the customer relationship] are the people you have working for you, and their mind-set to serve and help the customers.”

That vision flourished and grew when Mitchells acquired Richards. “The most important benefit we bought was the relationship that the sales associates and the tailors had with their customers,” Mitchell says.

“They had worked some 45 years establishing those relationships, but didn´t really know who their customers were. Associates were scribbling information down on pieces of paper.”

By introducing customized CRM technology, Mitchell was able to take Richards beyond the mom-and-pop stage.

“We brought in a system behind the scenes to track the important customer facts and we gave them the technology to manage customer relations effectively and profitably,” he adds.

Today, Mitchells and Richards share a customized customer database built in-house that is completely integrated with their accounting and inventory databases.

Profile…profile…profile

Gathering all that customer data begins with a profiling process in which sales associates ask customers for basic personal information, such as their names and addresses.

According to Mitchell, customers willingly provide the information because the retailer is respectful of its clientele´s privacy concerns.

“When we collect and file customer preferences or any other data customers provide, we are very sensitive to the whole area of privacy,” explains Mitchell.

“We never, ever share any privileged customer information with anyone—we don´t sell or rent our customer lists. We´ve even gone so far as to make sure all this information is password protected.”

As a result, customers trust the benefits of sharing their information with Mitchells´ sales associates, and go on to provide more personal data about their work and home lives, as well as their clothing preferences.

“Customers aren´t going to tell you their whole history on the first visit. But gradually you listen and you learn about them, and you know how to service them on a one-to-one basis,” says Mitchell. “You´ve gone from a transaction to a relationship.” (At 1to1 Magazine, we call this process “drip irrigation.”)

Enabling employees

As the face to the customer, sales associate buy-in is integral to making Mitchell´s vision of high-touch customer relationships work. To that end, store employees are authorized to “do whatever it takes for customers,” he says. “We don´t alter the price, but we´ll do almost anything to service customers and go beyond their expectations.”

Informational feedback is key to helping staff members achieve goals. Every morning in their work mailbox, sales associates get a recap of every sale they had the previous day.

Then, about two weeks after each sale, the database prints out a satisfaction report from which associates will call their customers and ask about their shopping experience. But, “It´s not a solicitation call, merely a satisfaction call,” Mitchell is quick to point out.

This approach pays numerous dividends for Mitchell´s goal of stocking his customers´ closets. In fact, one of the company´s personalized services is to do just that — go into customers´ homes to clean and organize their closets.

“These men and women are very busy people and their expertise is not clothing. So we provide our advice, and even take pictures of the various clothing combinations that will work for them.”

One resulting success story features a customer who lived in Mexico but had a summer place in Greenwich. According to Mitchell, the customer bought her Mitchells salesperson a roundtrip ticket to Mexico City to clean her husband´s closet and stock it with his favorite Brionis. “She loved it, and we were told her husband loved it too,” says Mitchell.

Every byte has value

Data is also a key enabler to Mitchells personalized customer-centric approach; therefore, none of the details of its customer relationships is ever discarded.

In Westport, the history goes back to 1989; in Greenwich it goes back to 1996. “We never throw customer data away. We keep product records, for instance, on Polo shirts that we sold five years ago,” explains Mitchell. “Maybe we´ll try to reactivate somebody who hasn´t been in for three, four or five years. To do that, we need to know what they bought back then.”

A new data report that Mitchell introduced this year, called profiling, highlights many of the key bits of personal information, such as business title, spouse or children´s names, gathered by sales associates.

“For a customer to be profiled, he or she has to have provided us with some personal and professional information,” says Mitchell. “For example, in the profile of a customer who´s president of his company, we would see his name, home address, family notes, wife, sons´ and daughters´ names, as well as a daytime phone number, either home or business.”

Profile reports are prepared daily to gauge how many customers were profiled, and to provide associates with opportunities to update their customers´ profiles or ask them for more information. The reports have become a management tool for Mitchells to measure its associates´ success.

“In the report for the last two weeks, for example, the average associate profiled 73.4 percent of his customers. Anybody below the average has got to ´go back to school´ and work with me and our managers on how they can improve their profiling abilities,” says Mitchell.

“It´s important for all of us to understand that if we know our customers, then we´ll do better for them, and they´ll know they´ll get the personal attention they deserve.”

Mitchells employs nearly 200 people—174 full-time and 20 part-time—and Jack Mitchell makes a point of extending his high-touch philosophy to his staff, as well. “I meet frequently with each staff member and always talk to them by their first name.” Every staff member also gets a birthday card from the Mitchell family.

Tailoring the marketing effort

In addition to its in-store efforts, Mitchells uses targeted direct mailings and telephone calls to market to different customers differently.

According to Mitchell, the company sends hundreds of individualized mailings each retail season, most of which feature personalized notes from sales associates about favorite brands or designers. Customers who have given their permission may also receive phone calls about designer shows, or recently arrived stock in a favorite brand.

MVCs—customers that spend more than ,000 in any single sale—receive personal notes from Mitchell each year. He also sends a personal note to all first-time customers within three days of their initial visit.

All of these relationship-building efforts, as well as the customer response to those efforts, are stored in Mitchell´s database to track and improve the effectiveness of the company´s varying efforts.

And, although Mitchells collects email addresses, its CEO doesn´t believe that either his customer base—or his associates—are ready for full-scale email marketing.

“We´re going to start experimenting in the near future with some sales associates who are computer literate and will send email to customers who have told us they want to hear from us that way. But we have to go very slowly. The process has to be designed to work extremely well all the time, from the customer´s viewpoint,” Mitchell stresses.

Looking ahead

Along with adding email marketing to the current relationship mix, the organization´s future goals include profiling 100 percent of its customer base.

“Every customer that comes in ought to be profiled. And if our associates are forced to get into the computer and put the information there, they will start asking these questions earlier,” he explains.

For Mitchell himself, the local buzz around his company´s success from friends, customers and colleagues has prompted him to write a book, which will be published in the spring by Hyperion. The title? “Hug Your Customers.”

Karen Burka wrote this article for the 1to1 Magazine’s November/December 2002 issue. 1to1.com offers consulting, management, and publishing services to businesses wishing to maximize their relationships with their prospects, customers, and staff.

Karen can be reached via email or at http://www.1to1.com.

Profiles of business owners respected in their industry appear in our newsletter and are available on our web site. We encourage association executives to tell us about their members who are leveraging their inherent advantages (trusted brand, excellent service, etc.) by embracing a “doing it right” attitude into their strategy for growth.

Web seminars are a cost effective way to communicate solution-oriented information to your target audience, build your brand, generate quality sales leads and build strong customer and prospect relationships.

Traditional face-to-face seminar marketing events have been recognized as a very effective business relationship builder, however the costs associated with travel and time away from the office have become significant barriers to getting and
keeping attendance.

New Web Conferencing technology leverages the Internet’s capacity to delivery real-time visual communication at low cost.

Web-based seminars enable presenters to conduct virtual seminars for anyone to participate as long as they have a PC with an Internet connection.

Webinar technology not only makes traditional seminars more affordable, they facilitate reaching a wider audience and add considerable advantages over traditional onsite seminars such as interactive Q&A, real-time collaboration, and digital archiving for playback from a company Website.

Web-based technology also can help facilitate seminar registration, attendance management and post event reporting.

Once you’ve decided to test Webinars and add them to your marketing mix, how do you achieve your goal of obtaining plenty of qualified leads?

Content is king

No one wants to attend a Webinar that’s an infomercial. Instead, pick a subject that really speaks to the audience you want to reach one that is educational or answers a problem they face.

What’s the target’s “hot button?” If you offer a topic they need to know about, you’ll grab their attention.

Give them useful information and provide a learning experience.

A well known speaker helps

Who will be the main presenter?

Choose a recognized expert, an author or a person who has succeeded in solving the problem presented the more respected and known, the better your attendance.

Selecting someone outside of your organization lends credibility to the value of the event.

Remember that the keynote presenter doesn’t necessarily present the complete Webinar. Others, including you or your associates, can also participate.

Big-name presenters may be easier to get than you think. Of course, you can pay them, if that’s in your budget.

Once they learn about the planned promotion of the event, the amount of publicity they’ll get, and the exposure to an audience they want to reach, they may reduce their fee or do it for free.

An offer to share the leads might be all it takes.

Timing is everything

You may have a fantastic Webinar planned, but if you have it on the wrong date or time of day, your target audience will be doing other things.

Think about your prospects and check the calendar.

Eliminate holidays and the days before and after them.

Forget about Mondays and Fridays. Mondays are too busy, and Fridays are for last-minute projects or early-departure days.

Are there any tradeshows that may conflict? How about end-of-the-month quotas for sales executives?

Consider the time zones of your expected audience. Since attendees will participate from their desks, when will they be there?

If you market nationwide, a good time is 1 p.m. Central time. If you market in only one or two time zones, schedule the
event between 11 a.m. and 1 p.m. Many prospects like to attend during lunchtime.

Give notice and follow up, follow up, follow up

Once you pick a date and time, when should you begin promoting the event and accept registrations?

Thirty days is the optimum timeframe. Any amount longer, and the prospect may forget or lose interest.

Less than 30 days doesn’t give you enough time to promote for maximum attendance. Also, it’s easier for your prospects to plan to attend something a month away than it is to plan for next week.

Realize that if you are planning only one Webinar, some of your hoped-for audience won’t be able to make that day or time.

A series of Webinars is better, or a choice of two dates for the same topic would help solve that problem.

Trying to hit a home run with just one big event on one day is not the best strategy.

Some valuable prospects may be vacationing, traveling or ill that day, so give them a choice of days or a series.

Make sure you send three to four reminder e-mails as the event date nears.

Its easy for people to attend a Web-based event, but it’s just as easy to not attend. A mix of E-mail and phone call reminders is key to increasing attendance.

Four strategies to maximize attendance Don’t be disappointed if only 40% – 60% of the registrants attend the event.

Here are a few tips to maximize attendance:

1. Leverage existing relationships. Take a good look at your trade groups, associations that pertain to the topic, your affiliates and your vendors.How can they help? Perhaps they may cosponsor the event. Publicize it in their newsletters. Place a registration link on their Web site. Ask them to participate in some way.
2. Use your customer base. Unless you’re a one-product or one-service provider, your existing customers should be contacted often.They already know the value of your company and are very likely to attend the Webinar. However, all too often, they may not know about your new offerings.

   They are your best prospects.

3. Merge promotion into your normal marketing program. That is the most economical method, because there is little or no additional cost.All your advertising, search engine ads, newsletters, email, banner ads, your own Web site, even print and broadcast
   represents an ideal opportunity to mention the Webinar and giving the link to register. It’s also a response-builder.

   Invitation calls by your sales force to customers and current prospects are a wonderful way to get registrations and warm up prospects.

   A personal invitation is usually appreciated and remembered. It’s an easy call to make and take, and may lead to some
   business right on the phone.

   In-house staff can also help in the promotion. Be sure they are aware of the Webinar. Provide them a script for discussing it with every customer and prospect they help.

4. Offer something valuable. Increase your attendance by offering a prize drawing at the end of the Webinar for those that attended.Keep the registration process simple A quick and easy registration process helps maximize attendance. You don’t want to lose a good prospect by making registration too cumbersome or lengthy.

   Your goal is to get complete contact information, reinforce the value of attending, find out the source of the lead and get some qualifying information.

Maximize attendance after the Webinar?

Even with all the reminders, some registrants won’t attend – an unscheduled meeting, an illness, the press of business that day… things happen.

You don’t want to lose these prospects, because they have already expressed a level of interest.

Use a technology that let’s you record the Webinar and put a link to view the archived presentation on your Web site.

Send non-attendees a “sorry you couldn’t attend” email with a link to the file on your Web site.

Ask for feedback?

Right at the end of the event ask the attendees to complete a quick, on-the-spot survey. Webinars are interactive.

Use this feature to get immediate feedback and more qualifying information.

About 75% of attendees usually fill out the survey. They ask other questions, provide input that improves future events and, most important, give you insights about their level of interest, needs and timeframe. Plan your survey carefully.

Follow up quickly

After the event, send each attendee a “thank you for attending” email. Send a survey to those who didn’t complete one earlier.

Now that you have hit the jackpot with all of these qualified leads- some warm, some hot, some as connections for the future, implement your sales plan. Get the information to your sales force and monitor progress and results.

With a carefully planned event, you are sure to win new business.

Curtis O’Keefe can be reached via email or at http://www.communiqueconferencing.com.

Curtis O’Keefe is VP, Sales of Communique Conferencing.