Who Is Most Engaged with E-Mail?

Gmail users click most

While the differences between Webmail properties such as Yahoo! Mail, Gmail, AOL and Hotmail may seem subtle, their user bases do not behave alike.
A study of success metrics for marketing e-mails sent through MailChimp’s distribution service showed that Gmail users were most likely to open and click on e-mails.
Open rates varied from a low of just over 20% for e-mail sent to AOL users to a high over nearly 31% among Gmail users. The click rate on e-mails sent to Gmail accounts was more than 7.4%, compared with rates between 4% and 5% for Yahoo!, AOL and Hotmail users.

Messages sent to Gmail accounts also had the lowest hard bounce rate, though other data indicates Gmail’s spam protection may be so stringent that messages disappear without producing a bounce. A 2009 Return Path study, for example, found a 23% nondelivery rate for marketing messages sent to Gmail. (For more information on nondelivery, see “Are You Deceived by Your E-Mail Delivery Rate?”)

According to comScore, Gmail is the third-most-popular e-mail property among US Internet users, though it posted the highest growth rate between July 2008 and July 2009. Unique visitors to the service rose 46% to nearly 37 million.

Yahoo! Mail and Windows Live Hotmail had significantly more visitors, at about 106 million and 47 million, respectively.

MailChimp suggests that demographic factors could be at work when it comes to the willingness of Gmail users to open and click on marketing e-mails, so the service’s continuing growth could bring its metrics closer to the average. But for now, the user base may be particularly friendly to e-mail marketing.

The Race to Be an Early Adopter of Technologies Goes Mainstream, a Survey Finds

For decades, the adoption and use of the latest technologies was limited to a subculture: Whether called “tech enthusiasts” or “gadget geeks,” the implication was that most of the world got along fine with older, established products and services, while a smaller group pursued the most leading-edge technology.

But according to a study released Wednesday by Forrester Research, a marketing firm based in Cambridge, Mass., a shift has taken place. What used to be the pursuit of a few has become decidedly mainstream. We’re all gadget geeks now.

According to the study, which surveyed 53,668 households in the United States and Canada by mail, half of all American adults are gamers. Sixty-three percent of American households have a broadband Internet connection. Three-quarters of American households have cellphones and PCs. And nearly 10 million American households, out of nearly 118 million, added an HDTV in the last year, a jump of 27 percent over 2007.

“There’s really no group out of the tech loop,” said Jacqueline Anderson, an analyst with Forrester who was one of the study’s authors. “America is becoming a digital nation. Technology adoption continues to roll along, picking up more and more mainstream consumers every year.”

High-definition television sets were one of the fastest-growing consumer technologies in 2008. Over the next five years, the company forecasts, nearly 39 million households in the United States will get their first high-definition set, bringing total market penetration for HDTV to nearly 70 percent.

The study also found that despite the recession, online spending remained strong, with older consumers leading the charge. On average, those consumers spent $560 in the last three months, although “20 percent of that group spent more than $1,000 online in the last three months,” Ms. Anderson said. Given the tumultuous economic climate, “that’s a lot of money,” she said.

Ms. Anderson also pointed out that families were a big driver behind the widespread adoption of technologies. The popularity of video game consoles like the Nintendo Wii, which took a decidedly different approach from other game-console makers by appealing to nongamers and families, created an opening for more digital entertainment to enter the home.

Families are also more likely to have gadgetry like MP3 players, digital cameras and digital camcorders. “They have little kids so they want to catalog those memories,” Ms. Anderson said. In addition, 86 percent of families with children had mobile phones but were also more likely to use mobile phones with more features like music and video playback.

The study also suggests a growing reliance on the Internet for commerce, communication, entertainment and social lives, said Charles S. Golvin, an analyst with Forrester Research, and a co-author on the study.

“The digitization of our daily lives has been steadily ramping up over the past decade,” Mr. Golvin said.

One area that appears to be slower to catch on is home networks. The survey found that 33 percent of households in the United States with an Internet connection reported having a home network, up from 28 percent a year ago. Although Ms. Anderson says that figure is relatively high, the adoption is still lower compared with the adoption of other home technologies.

“The barrier to entry for a home network is a lot higher than for an HDTV, where all you have to do is buy one,” she said. “There are more components and you have to understand how to connect them. Many people had the components for a home network before but didn’t necessarily understand what it meant to put them together or why they’d want to,” she said. In the next five years, the company forecasts, more than 30 million households will install a home network, bringing market penetration to just over 50 percent.

Already, Mr. Golvin says, more people are migrating away from the home and office to use the Web and turning toward their smartphones. About 15 percent of cellphone owners were using the Internet on their phones in 2008, the study found, showing that, for a growing number of Americans, there is an increasing “expectation that all the same services and resources are available to us no matter where we are,” he said.

Design Your Customers' Decisions

There is a vital lesson buried in the August 19, 2009 Jet Blue announcement that they were suspending sales of the $599.00 "All You Can Jet" promotion they'd debuted only seven days before. Any student of Behavioral Economics could have predicted that an "all you can eat" approach would inspire vastly different behavior than if Jet Blue had charged a lower fixed fee plus $1 per mile. Similarly, over a decade ago when AOL switched to a usage-independent flat price, connection time increased four times more than they anticipated.

"All you can eat" is an entirely different price than "very, very cheap."

Traditional economics says that lowering the marginal price from $2 to $1 should have a similar effect to lowering it from $1 to $0 — but experience and experiments have both shown that the traditional demand curve acts in an odd manner when we reach $0 marginal cost. Jet Blue's executives should have known better.

But the Jet Blue management team is not alone.

Many executives assume their customers are more rational than they really are. For example, most leaders believe in enhancing the options given to customers, but increased choice can actually freeze decision-making by overwhelming the shopper. Excessive options is a key reason that an average of 60% of all online shoppers abandon their purchases mid-stream. Behavioral Economics is the study of how people really think as opposed to how we think they think. To some of us, who were never fully convinced by the hyper-rational assumptions of neo-classical economics, it is a welcome return to reality.

Yet, many firms have such a deep case of rationality-itis that they continue to treat their customers as if they were designed by Adam Smith. In working with Dan Ariely, we've begun to apply a set of ideas from Behavioral Economics in real world settings, around four distinct areas: framing, aversion, social context and timing — what we call FAST decision-making designs — and their impact can be significant. Our aim is to make the choice process easier for the customer.

In their famous recommendation engine, Amazon combines framing and social context, which gives the shopper an easy way to traverse millions of possible selections. In our work with clients we have found that it's possible to increase choice to a higher value and higher-priced product by as much as 10 or 20% by framing the option that is contextualized to them (e.g., "Someone like you also bought this other book.") This is consistent with Amazon's belief that their recommendation engine increases the average purchase by 20%.

In our world of information overload, every new choice is an effort — so companies need to give as much thought to the process of choice as to those choices and options themselves. For instance, Dan noticed that the Economist, at one time, showed three options for their potential subscribers: online-only for $59.00, print-only for $125.00, or online and print for $125.00. He designed an experiment, using his students, in which 84% chose the $125.00 for print and online, 0% chose print-only, and only 16% chose online-only. Any rational manager would say the $125.00 offer print-only offer was useless.

But when Dan removed the $125.00 print-only offer, 68% of people bought the online product for $59.00 while only 32% shelled out for the $125.00 bundle! In other words, the higher-priced option was chosen less than half as often. By having the decoy of $125.00 for print-only, the customer could make an easy comparison to the other $125.00 offer in which they got online for "free." Even something as simple as choosing a magazine has enough complexity in it that a decoy choice can radically change buyer behavior.

If Jet Blue had understood the implications of Behavioral Economics, they may have raised the price on their offer — but despite the data that shows the power of designing the decision process, few companies trust Behavioral Economics because stands in the face of much of the economic logic executives were taught in school.

Every manager should remember that in a world of excess choice, an easy place to differentiate is in the careful design of the decision process itself. It is especially powerful in the ever-increasing realm of e-commerce. Few companies have optimized their customer choice process to make the most of the web. Fewer still do regular experiments to find out how their customers really act instead of how they are supposed to act, and they are leaving money on the table because of it. So ask yourself: is your company's choice process optimal — and do you have data to prove it?

More marketers use social networking to reach customers

Ford Motor has high hopes for Fiesta, a popular model abroad launching in the U.S. next year.
So how does it introduce the subcompact car to Americans?

A massive ad blitz on TV? In-house promotions at dealers nationwide?

Nope.

In April, Ford tapped 100 top bloggers and gave them a Fiesta for six months. The catch: Once a month, they're required to upload a video on You Tube about the car, and they're encouraged to talk — no holds barred — about the Fiesta on their blogs, Facebook and Twitter.

"It's extremely important to this company's history," says Scott Monty, whose job as head of social media at Ford was created about a year ago to take advantage of the growing social-networking wave. "It's about culture change and adapting to this ongoing way of communicating. The bloggers are fully free to say what they want."
Social-media services, such as Facebook, Twitter, YouTube and countless other websites, have had a profound effect on how millions of Americans — especially those under 35 — interact with others (or don't), shop and view brands. It's a real-time digital lifestyle, powered by smartphones and netbooks, that often colors what products they purchase, how they view brands and where they spend most of their waking hours.

Marketers have noticed. Social-networking services increasingly are indispensable business tools, says Forrester Research. According to its survey of 1,217 business decision makers worldwide late last year, 95% use social networks to some extent.
And 53% of more than 300 marketers planned to increase social-media marketing spending this year, according to a Forrester presentation in April.
Some of the biggest companies — Ford, Levi Strauss and Chevron, to name a few — are reengineering marketing operations to embrace digital tools to more nimbly brand products, support customers and cash in on the social-media wave. In doing so, they are creating online communities and aggressive outreach programs, and being brutally honest in talking directly to their customers/followers/fans/friends.

"It was an easy call. This is where our customers are," says Megan O'Connor, director of digital marketing at Levi's. The more-than-150-year-old company last month launched a social-media program on Facebook and Twitter along with a larger "Go Forth" traditional marketing campaign. Its goal is to burnish its brand name among young men.

Grown up digital

At their core, social networks are fostering a blistering number of personal connections and chatter online. The share of Americans 18 and over online who use a social-networking service more than quadrupled to 35% in 2008 from 8% in 2005, according to Pew Internet & American Life Project.

"It's the modern-day version of knitting — to kill downtime," says Kaitlin Villanova, 26, a social-media strategist in Brooklyn who is an avid iPhone user. "I use social networking to communicate, bank, comparison shop, everything."
Facebook is up to 250 million members, 50 million of whom joined in the past three months. In April, they spent 13.9 billion minutes on Facebook, up 700% from April 2008, says Nielsen NetView.

More than 300,000 businesses — one-third of them small businesses — have a presence on Facebook. Members of its fastest-growing demographic — those 35 and older — have enormous purchasing power, a powerful incentive to marketers.
Twitter has about 40 million users who each day produce a staggering amount of tweets, Twitter's quaint word to describe short messages. Its users spent nearly 300 million minutes on the site in April, 3,712% more than in April 2008, Nielsen says.
Increasingly, consumers don't search for products and services. Rather, services come to their attention via social media, says Erik Qualman, author of Socialnomics, a new book that explains how social media have changed how companies do business.

Social-networking-savvy businesses have appointed social-media directors to help:
•Add customers quickly. When software maker Intuit built a site for small businesses in late January, it integrated elements of Facebook, Twitter and LinkedIn, the social network for business professionals. After 12 weeks, it generated more than 1 million visits and helped spike QuickBooks unit shipments 57% in June, year-over-year.

"Social (media) is one of the key trends driving our business," says Kira Wampler, social-media marketing leader at Intuit. "It's more than pure marketing. It's about fast connections with customers and building an ongoing relationship."
National pizza chain Papa John's added 148,000 fans on Nov. 17 through a guerrilla marketing campaign on Facebook. It offered a free medium pizza to anyone who signed up to be its fan on Facebook. The promotion gained it thousands of customers and drove its Web traffic up 253%. It now has more than 300,000 fans and hopes to top 1 million by the end of the year.

•Word-of-mouth marketing. Sometimes a company's best advocates are its customers. Just ask Best Buy and MyFICO, the consumer division of Fair Isaac, which invented the FICO credit-risk score used by lenders. They've built specialized online communities where their customers freely evaluate products and services.

Those who visit MyFICO's community website are spending 41% more than other customers, says Lyle Fong, CEO of software Lithium, which helps build online communities for more than 150 companies, including MyFICO.
Nine in 10 consumers trust their peers more than marketers, according to a recent survey of 25,000 by Nielsen.

The Federal Trade Commission is in the process of amending guidelines that would require bloggers to disclose their relationships with marketers whose products they endorse, says Mary Engle, associate director of advertising practices for the FTC.

•Enhance customer service. For more than a year, Comcast has pioneered the use of Twitter to talk directly to customers. Its Twitter page, @comcastcares, has 28,000 followers.
Comcast's blueprint for unfettered customer support — no more waiting on hold on the phone — fomented a movement. Software maker Sage North America, to cite another example, routinely receives instant feedback from hundreds of people within an hour on specific products and services. "It is a living, breathing, 24/7 think tank of users and employees," says Ryan Zuk, a company spokesman.
Besides being instant, such feedback is cheap. Typically, companies have relied on third-party focus groups that let them observe the reactions of customers during a two-hour session that can cost $10,000 to $15,000, says Natalie L. Petouhoff, an analyst at Forrester Research.

Lenovo has seen a 20% reduction in call-center activity in the U.S. over six months because nearly 50,000 customers go to its community website for information about laptops.
•Speak directly to customers. Blogs, Twitter or Facebook can be an ideal forum for CEOs to offer customers a candid viewpoint.
When a hack attack disabled Twitter's service for hours this month, co-founder Biz Stone gave up-to-the-minute updates on the company's blog.
The Carphone Warehouse, Europe's leading independent retailer of mobile phones and services, has a simple credo: It says, "I'm sorry" when necessary on its Twitter page for customer support.

"There is no gap between the CEO and customer. They now talk directly to each other," says Promise Phelon, CEO of UpMo, a career-management website. "The network is so connected, there's no need for a middleman."
"These customers want honesty, and quickly," says Shiv Singh, who wrote a report on social-media marketing for ad agency Razorfish.

Challenges ahead

But with rewards come risks.

Reaching out to millions of consumers who thrive online around the clock requires an investment, a different type of thinking and some courage, says Petouhoff. She spent six months on a just-released report on monetization of social-media tools at 20 companies, including Lenovo and Intuit.

Many companies — reflecting the general public's sentiment toward social media — fall into two camps: Those who embrace it and those who eschew it. "Those that don't know how to get their arms around it seem to be held back by worrying about the legal implications of customers helping customers, and about being too honest with customers," Petouhoff says.
Most corporations are still wedded to a traditional marketing approach, based on TV, radio and print ads, says Charlene Li, partner at technology consulting firm Altimeter Group. "Ford and Levi's are at the avant-garde of social-media use, but they are not typical," she says.

A social-media plan is hardly a guarantee of success, Li and others say. While some companies — especially market leaders such as Starbucks and Nike with consumer products — are predisposed to the medium, others aren't. Tightly regulated health care providers, for example, may think twice about making the public's comments readily available on Facebook or Twitter.

"Social media is not the messiah," says Michael Brito, social-media strategist at Intel. "It is one of several tools."

Still, a growing number of marketers can't afford to ignore millions of potential customers who are consuming media in new ways.

Three-fourths of men ages 18 to 34 say they spend most of their time in front of a computer screen vs. 18% in front of a TV screen, according to a survey of 50,000 by AskMen.com, a lifestyle website. Those who don't have a social-media plan don't at their own risk, say marketing experts.

"Companies have no choice. This is where their customers are going," says Shel Israel, author of the forthcoming Twitterville: How Businesses Can Thrive in the New Global Neighborhoods.

"Companies have no choice. This is where their customers are going."

IN:FUSE Overview

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In Fuse Overview

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Social Media Rewrites the Rules for Brands

by Lauren Benet Stephenson June 24, 2009

Gucci is doing it. So are Oscar de la Renta, Donna Karan, Target, Urban Outfitters, Louis Vuitton and Rachel Roy.
Fashion houses, designers and retailers are rushing into the free social media phenomenon that is reshaping not only interpersonal communication, but how apparel, accessories and beauty products are marketed and sold.

They are tweeting, blogging and updating their profiles in an effort to mold their brand personalities on real-time global platforms and form relationships with a community of customers, particularly consumers for whom the Web is as important as a limb.

“Customers can feel like they are part of the brand’s extended family, and therefore the brand itself, while the interactive element further deepens that relationship,” said Alex Bolen, chief executive officer of Oscar de la Renta. “These characteristics address and satisfy that ‘tribal’ part of the fashion consumer — the way in which people identify themselves by the brands they buy.”

A key component of social media “is real-time feedback — an ability to accurately measure marketing results,” Bolen said. “While this aspect of the Internet’s promise has yet to be fully realized, one can adjust, fairly quickly, to emphasize those initiatives that are working best.”
The newness of the platforms has made quantifying the sales impact of social media tough to pinpoint, although companies cite rising Web traffic and more customers using promotions.

“How do you quantify something that prevents a customer service problem that could’ve been a disaster,…[that] can create new buzz for a new product?” asked Paul Argenti, a professor of corporate communications at Dartmouth College’s Tuck School of Business. “How do you quantify that? Where else can you get that kind of instant feedback? It’s all unquantifiable and all incredibly useful.”

Reggie Bradford, ceo of Vitrue, a social media consulting firm, believes it’s important to view the situation in reverse, saying a brand will ultimately be “measured in growth or losses by being there [on social media] or not being there.”

More than any marketing medium, including print, where advertising is suffering, social media give brands a chance to be a part of a dialogue about their own companies. In this new and evolving framework, everyone is a participant. According to Forrester Research, Facebook, with an estimated 200 million users, classifies two-thirds of its users as being of post-college age, with 35-plus the fastest-growing demographic. Twitter, a platform for messages of 140 characters or less that had 20 million unique visitors in May, has 42 percent of its users in the 35-to-49 age range and 20 percent ages 25 to 34.

You don’t have to be famous to get a following, but it helps. The king of the Twitter hill is Ashton Kutcher, who got into the game early and has more than 2.3 million followers. Oprah Winfrey, whose first tweet didn’t come until April — “HI TWITTERS. THANK YOU FOR A WARM WELCOME. FEELING REALLY 21st CENTURY” — now has over 1.6 million followers.
The fascination with fashion has even helped breed followings for Twitterers masquerading as major industry figures, including fakekarl (Lagerfeld) and fakeanna (Wintour). WWD’s own Twitter page has grown to more than 688,000 followers from a mere 200 since its launch in February.

Designers such as Rachel Roy and Charlotte Ronson share snapshots of their personal lives and their company’s activities via social media.
Brands including Gap, Victoria’s Secret, Ralph Lauren, Calvin Klein, Nike and Adidas also have tapped into YouTube, MySpace and other sites, where their videos, commercials, behind-the-scenes footage and fashion shows are posted.

“Everyone wants to know what makes [designers] tick, why they design, and get closer to the brand,” said Frances Pennington, vice president of global marketing for Juicy Couture.
Ronson said she updates her Twitter fans at least daily “letting them know if something new comes in or something sells well. It’s a good way to keep everyone connected.”

The designer maintains a Twitter page for her business — Twitter.com/shopronson — with 2,084 followers since starting in the last three months. It includes examples of the Twitter-as-marketing technique, such as a recent tweet that said, “Just got in some great Rag & Bone items…hats, ties and belts…come check it out!!!”

Ronson’s attention to her Twitter page has yielded results in her retail site’s traffic. About 10 percent of Ronson’s total site traffic originates on Twitter, and 93 percent are new visitors. Ronson also posts daily updates on her personal Twitter page, Twitter.com/cjronson, which has 11,946 followers, with musings about her day, such as, “I’m watching ‘Funny Face,’ the musical with Audrey Hepburn and Fred Astaire…Need I say more…”

Roy tweets several times daily on Twitter.com/rachel_roy and has attracted 1,672 followers who frequently retweet — the Twitter term for forwarding a message — her posts. The designer mixes promotional tweets, such as, “The entire RR 2010 Resort Collection Lookbook has been posted on Rachel Roy’s official Facebook Page. Check it out,” with more personal tweets — “I found some cute wellies by Hunter for my daughter and I — green for me and purple for her. Here’s a link to more.”

The juxtaposition is engineered to nurture ties with customers. “I hope that my relationship with customers will become more intimate as they get to know me beyond my designs,” she said.
Facebook relaunched its company page platform in March with more options for organizations to elevate “the power of the brand,” said Tom Arrix, the site’s vice president of U.S. sales. The result is a company page that looks identical to a user’s page, with a “Wall” where the company and its fans can post messages, photos and video; a tab for information about the company, and additional tabs where a firm can add everything from sale promotions to trailers for new ad campaigns.

Facebook offers its users the ability to “fan” a firm or brand — a component that sets it apart from a standard company Web site. Once a user has “fanned” a brand, the business has direct access to them and is able to send messages and updates via a constant news feed on the user’s home page.

The result is a “powerful brand advantage….The company is now in the middle of two-way communication with their consumer,” Arrix said.

To join Twitter, a user creates a free user name and password and then sifts through a search function to find friends and companies the user would like to “follow.” Once a user is following a company, the user’s home page is refreshed with every update that company sends. For instance, if LouisVuitton_US tweets “Louis Vuitton’s new Core Values campaign profiled in today’s @nytimes,” all 10,492 of its followers will see this message on their home pages.
Some naysayers may find it hard to understand why a person would invite a company into their virtual personal life by fanning a company on Facebook or following them on Twitter, but millions have done just that.

It remains difficult to decipher what an online following means for companies in the long term. The more established Facebook and MySpace now have retention rates of almost 70 percent, according to Nielsen Media. However, Nielsen Media estimated more than 60 percent of first-time Twitter users neglected to return to the site after a month.

Vitrue created a Social Media Index to measure what people are talking about online. The index is generated from an algorithm that scours the Internet for a specific term on searches and social media networks and produces a score. The higher the score, the more frequently that term has been mentioned on the Web. Vitrue looked at 35 major fashion brands and retailers from May 26 to June 1. The five most-talked-about brands were Gucci, Target, Gap, American Apparel and Urban Outfitters.

These brands are, not coincidentally, active on social platforms. They “leverage their presence on social networks, have great content [updated frequently] and tools for engagement and conversation,” Bradford said.

“Fashion brands are emblematic of a person’s personality and how they want to be perceived; it’s woven into [her] identity,” he said. “Everybody loves brands — whether they’re generic or Gucci. It’s a statement.”

Gucci first became involved with Facebook in November 2008 after noticing that about 50,000 fans had signed up for a Gucci page started by a person unaffiliated with the fashion label. So Gucci decided to launch a company page, raising the fan count to its current total of 402,502.
The weekly updated page contains original video uploaded to the site, photos from events and new product announcements.

The Gucci by Gucci label launched its Twitter page — twitter.com/GuccibyGucci — in March and has 2,840 followers.

The “currency of the Internet is such that if you’re not updating on a timely basis, individuals are disappointed,” said Robert Triefus, worldwide marketing and communications director for Gucci. “In fact, it can end up backfiring.”

Target has used its Facebook page — with 452,856 fans — for advertising its latest designer collaborations. The retailer most recently posted a video of Dror Benshetrit explaining his collection for Target. The chain also used the page to publicize its philanthropic efforts through a user-interactive application. The company launched the “Bullseye Gives” campaign that allowed its users to vote on the charity to which Target should give money. When a user chose a charity, she was offered the option of publishing her choice to her own news feed.

For instance, if Facebook user Jane Smith voted for Red Cross, it would appear on her home page and on all of her friends’ news feeds, with the message “Jane Smith voted for the Red Cross for the Target Bullseye Gives project,” with a link to the Target Facebook page. This component is illustrative of the allure of Web 2.0 — interacting with a customer who then spreads the company’s message.

Gap has a Facebook fan page with 321,875 fans, and is active on Twitter with 5,269 followers. The Gap Facebook page has videos of designer Patrick Robinson talking about the brand, as well as photos of events and original content.

Urban Outfitters posts promotions and events, and encourages its 101,453 Facebook fans and 27,948 Twitter followers to get involved with the brand. A recent Facebook post read: “It’s your favourite time of the year again — Sale Time. Our Boutique sale starts today online and in store! This means Luella, See by Chloé, Anglomania by Vivienne Westwood, Thomas Burberry, Karen Walker, Peter Jensen et al. are all waiting for you; but not for long!”

Within four days, 72 Facebook users had responded to that post, one of whom recommended a particular Urban Outfitters location, saying, “Best sale upstairs at santana row!”
When American Apparel and its ceo, Dov Charney, were embroiled in a lawsuit filed by Woody Allen over unauthorized use of his image, the company used its Twitter page, with 31,167 followers, and Facebook page, with 133,577 fans, for direct access to customers by posting its official statement on Facebook and linking to Twitter. “We were able to speak and reassure customers,” said Ryan Holiday, an American Apparel spokesman.

According to company estimates, 10 percent of all traffic to americanapparel.net originates from four social media sites — Facebook, Twitter, Chictopia and LookBook.

Oscar de la Renta and Donna Karan have each dedicated a Twitter page to their “PR girls” — Twitter.com/OscarPRgirl and Twitter.com/dkny. OscarPRgirl, which promotes itself as “reporting from inside one of the world’s most prestigious design houses,” began tweeting on June 4 and has 162 followers. A recent tweet: “Hathaway is the new Hepburn: Anne H. looking impossibly chic @ the tony awards in Oscar de la Renta.”

The DKNY page, which launched on May 8 and has 981 followers, bills itself as providing “behind-the-scenes scoop from inside DKNY” written by a “PR girl.” The tweets are personality-laced messages that promote the Donna Karan label, such as “So great! Karen Olivo won the TONY (Award for “West Side Story”). She looked so chic in Donna. Huge pic in the @dailynews.”
Betsey Johnson began her Twitter page, Twitter.com/xoBetseyJohnson, Jan. 23 and has 8,068 followers. The page is updated several times daily with promotional tweets such as “Don’t miss out on our Memorial Day sale! Tomorrow is your last day to save 30%!” mixed with attentive dialogue with her followers — for instance one follower said “doing some damage on the @xoBetseyJohnson Web site. retail therpy” and xoBetseyJohnson responded “Nice! Everyone needs retail therapy! Xox”).

“We saw [social media] as a real opportunity to reach out to customers, to use it as free advertising and be a human voice for the brand,” said Agatha Szczepaniak, public relations director.

Kate Spade coined the term “tweetwriter” — a combination of “Twitter” and “typewriter” — as a tool in the company’s venture into social media. The Tweetwriter is an antique typewriter, which was set up in the brand’s Fifth Avenue store in May. The staff encourages customers to type messages they would like to see on the Kate Spade Twitter page, which has 641 followers. Eclectic entries such as, “from 135 5th ave: i could watch the clouds pass all day” fill the page, giving it a quirky feel. Lindsay Stevens, director of marketing and strategy, said the aim is to project “a collective point of view from our customers.”

Juicy Couture launched an interactive social media platform on its own site, called Club Couture. The technology allows consumers to put together looks from the collection and share the outfits with friends who can then rate the outfit and create their own.

This social interaction has resulted in a conversion rate 162 percent higher than any other part of the site — meaning a user who happens upon the Club Couture page on the company’s Web site is 1.62 times more likely to purchase an outfit on the site than if she had been browsing any other page on juicycouture.com.

It is essential for businesses to have a clear strategy and goals regarding social media, said analyst Diane Clarkson of Forrester Research, who wrote the report, “How Twitter Can Influence eBusiness.” Diving in without them is not a viable option.

Social media is “a little bit of a Pandora’s box,” Gucci’s Triefus said. “If you’re going to get involved, you have to have the resources to be able to do it correctly.”

If a brand isn’t vigilant, a constantly adapting, public organism like Twitter or Facebook might do more harm than good. For instance, a “Twitter storm” is a digital mob of sorts that forms around a topic or current event — which, when negative in nature, can harm a company’s image if there’s no counterpoint from the brand in question.

“We’ve seen Twitter storms with fast backlash when a company does something that [fans] don’t like,” Clarkson said. “I’d want someone accountable for the brand to be behind that.”
What appears certain, however, is social media platforms will keep evolving, proliferating and gaining influence.

“The fashion world is shifting, needs are changing and people’s shopping habits are changing….It’s clear that [consumers on social media] are part of the overall fashion conversation,” Roy said. “And I don’t think that is going to change.”

State jobless figures show signs of stabilizing

From the Minneapolis Star Tribune:

Minnesota employers cut 1,600 jobs in May -- the smallest number of cuts in 10 months -- putting the monthly unemployment rate at 8.2 percent. That rate is up slightly from April's revised 8 percent. Minnesota employers cut 7,000 trade, transportation and utilities jobs and 2,100 manufacturing jobs last month, but restaurants, hotels and others in the leisure and hospitality industry added 7,100 jobs -- a significant jump from the same month in 2008.

Nationally, the unemployment rate soared to 9.4 percent in May and there are predictions by research firms that the national rate could top out at 10.4 percent next year. Minnesota's May results gave some hope that the state is further distancing itself from the national recession.
"The leisure and hospitality gain ... was a huge increase,'' said Steve Hine, Minnesota's director of labor market information. "Not only was there a real surge in jobs at food and drinking establishments, but it was across the board."

Hine credited some of the surge to improved consumer confidence, tax relief provided through the federal stimulus package and pent-up demand.
Another positive sign came from the construction sector. For the first time in two years, construction companies added jobs, hiring 900 workers last month as the stimulus packaged kicked into gear, providing funds for highway construction.
The trend is expected to continue as stimulus money flows to new water treatment projects around Minnesota, state officials said.

"It's not clear if we have reached a turning point in our economic recovery, but there are some optimistic signs," said Dan McElroy, commissioner of Minnesota's Department of Employment and Economic Development. "We are encouraged that the unemployment rate has held steady in recent months and that the pace of job losses appears to be slowing."

The weekly number of new unemployment claims was about 7,500 two weeks ago and 6,500 last week. However, there were also about 2,800 reactivated claims, which put the news claims figure at 9,300, down from around 11,900 in January.

While its down, "these are high numbers compared to other years," McElroy said.
Minnesota currently employs about 2.67 million workers. State economist Tom Stinson said that prior to the recession the state had been gaining about 30,000 to 40,000 jobs in a year. But over the past year Minnesota has lost 96,000 nonfarm jobs, or about 3.4 percent of total employment.

Changing consumers

Changing consumers: WRC 09 insights

ANDREW JOBLING, WGSN 04.06.09

Consumers are changing.

Whether being moulded as a result of the global financial crisis, shaped in response to the advances in technology or enlightened as emerging markets flourish, the shoppers of tomorrow will be very different from those of today.

Of all the important themes to emerge at the World Retail Congress, held in Barcelona in May, one of the most important stressed that many previous strategies could no longer be relied upon. Consumers are changing, and retailers need to keep up.

Several factors are influencing these changes, and unsurprisingly global recession is one of the biggest. The slowdown has hit the consumer mood hard, shifting attitudes. It has altered the perception of what is required in a product and, importantly, what is desired. In many ways, the aspirational consumer is no longer aspiring but instead seeking out value for money, with Jim Stengel, CEO of Jim Stengel LLC, noting that it had "become fashionable to be thrifty".

David Roth, CEO of WPP's retail division The Store, said that consumers have reprioritised and there will not be a return to "business as usual". Instead there is now a focus on sanity, and from a retail perspective that means range rationalisation becoming the new cost-cutting agenda.

One area likely to feel the effects of this mood shift is affordable luxury, with consumer aspirations to be seen as enjoying the glamorous trappings of wealth being replaced by a focus on value. Concetta Lanciaux, CEO of Strategy Luxury Advisors, describes the process as trading up, where consumers are still willing to spend but only on products that offer inherent quality rather than superficial glamour.

"Trading up means removing fake," she said. "Consumers today prefer to buy semi-precious stones rather than zirconium."

But amid the frugal mood, Stengel suggests that there are "ripples of opportunity" for retailers who really emphasise the consumer experience throughout the retail journey. Play an important role in their lives, stand for something that matters and focus on the ownership of the product rather than just the purchase, he says.

"Those that really understand what is going on with the shopper will be the ones that lead the way in the future," he said.

Emerging middle classes.

Emerging markets are seeing a different consumer change, driven primarily by a rapidly expanding middle class. China, for example, is expected to see its middle class surge from 6.15% of the population currently to 55% by 2020, and fast growth is predicted in many other developing markets.

What this means is that demand for many items, including discretionary consumer goods, will drive upwards. Of course this isn't a new development - emerging markets have interested major retailers for years, but they have met with mixed success and speakers at the World Retail Congress offered some explanations for this.

Key recommendations included focusing on local markets rather than trying to implement broad strategies; and really getting to know what the local consumer wants - something that can vary wildly across huge countries. However an important point to note is that as markets mature, so does the consumer, and those in some of the major target countries are learning quickly.
"The Indian consumer will be very demanding," said BS Nagesh, MD of Indian retailer Shoppers' Stop. "There is a new class of consumer that demands his rights and knows to shift to someone else if they are not satisfied."

Bijou Kurien, CEO at Reliance Lifestyle, went on to add that consumers in the country were now much more brand-aware, demanding the latest season's ranges as well as a much wider choice. However, they are also more willing than ever to spend, due to a higher confidence in the future among young consumers.

Technological drivers.

Aside from economic factors, technology is playing a huge part in the changing consumer. Recent years have seen e-commerce, m-commerce and social networking all combining to add options for consumers and shake up the retail environment. But now consumers themselves are changing as the technology becomes an integral part of the shopping experience - and what's more, they are demanding that retailers change, too.

John Donahoe, eBay CEO, said that consumers are naturally now integrating online research with store visits, and with that integration only set to increase they are "demanding that we break down the boundaries" between online and brick-and-mortar stores.

"We need to embrace the fact that online and offline are blurring, and the consumer wants convergence," he said.

Social networking is seen as a crucial strategy, with retailers keen to tap into the powerful word-of-mouth marketing opportunities it could provide but also realising that the technology revolution has changed the way brands need to communicate.

Roth noted that consumers who have grown up in a digital world are used to communicating through interconnected "channels of me", and as a result the way a consumer interacts with brands has changed for good - with retailers needing to be much more efficient in their communication across the whole path to purchase.

However while social networking offers a multitude of possibilities, retailers need to be careful to maintain the medium's authenticity - attempts to turn it into a sales and marketing tool are likely to be met with resistance by the very audience they are trying to connect with.

They also need to be able to treat it as both friend and foe. Hot Topic discovered that the popularity of social networking was challenging the time-honoured tradition of teens hanging out at the mall and, as a result, having a direct hit on its sales.

"Retailers need to find a way to get people into their stores, rather than relying on mall traffic," said CEO Betsy McLaughlin.

The answer for Hot Topic was to have live music with bands playing in store, and the retailer garnered results in the shape of a turnaround from negative comps to record six consecutive months of gains.

Key points
Recessionary pressures
• The global recession is provoking long-term changes in consumer mindsets.
• Value is key, with more-superficial aspirations in decline.
• Retailers need to concentrate on consumer experience, offering value not just at the point of purchase.
Emerging markets
• Booming middle classes offer huge potential but successful market entry is often tricky.
• Retailers need to concentrate on local markets rather than broad-based strategies. Get to know the consumer.
• Consumers are becoming more educated and more demanding.
Technological drivers
• Consumers are pressuring retailers to "break the boundaries" between online and brick-and-mortar stores.
• Increasing technological integration in shopping experience is changing the way consumers shop.
• Brands need to communicate better across all paths to purchase.
• Tapping into social networking offers huge possibilities, but there are also challenges.

© WGSN 2009

Wal-Mart to add 22,000 jobs in U.S.

BENTONVILLE, Arkansas (Reuters) -

Discounter Wal-Mart Stores Inc says it will add more than 22,000 jobs in its U.S. namesake stores in 2009.

The forecast points to lower growth compared with last year, as the world's biggest retailer opens fewer of its U.S. Wal-Mart discount stores to focus on expansions and renovations.

Last year, the company created 33,800 U.S. jobs, though that figure also included new jobs at its much smaller Sam's Club members-only chain of warehouse stores.

Wal-Mart has gained market share despite the poor economic climate as shoppers seek out its low prices on everything from food to electronics.

But the retailer has not been immune to the downturn. At an October analyst meeting, executives said the company would slow expansion of new U.S. Wal-Mart supercenters to focus instead on spiffing up existing stores.
Last October, Wal-Mart announced plans to open 157 to 177 new or expanded stores and clubs during the current 2010 fiscal year in the United States.

Numerous retailers including Target Corp and department store operator Macy's Inc have announced job cuts in recent months as the recession slows sales.
Overall, the U.S. economy is expected to shed 520,000 nonfarm payroll jobs in May alone, according to a Reuters poll of 79 economists.

Wal-Mart said the new positions will be in all levels of retail operation, including cashiers sales, store management to pharmacists and other positions.

Benefits, including affordable health plans that offer customized health coverage options, will be available to full- and part-time associates, the company said.

The announcement comes as the retailer readies for its annual shareholder's meeting on Friday, and just four months after it slashed 700 to 800 jobs at its Wal-Mart and Sam's Club home offices in Bentonville, Arkansas.

(Reporting by Ian Sherr and Lisa Baertlein; Editing by Gary Hill)

Move Over, Amazon? Google Aims to Sell e-Books

Internet June 1, 2009, 10:03PM EST

Move Over, Amazon? Google Aims to Sell e-Books

Google's plan to offer online access to books on a variety of Web-enabled devices could threaten Amazon's Kindle

By Olga Kharif and Douglas MacMillan

Amazon may want to keep an eye over its shoulder—Google is readying a deeper push into e-commerce. In the coming months, Google (GOOG) plans to begin selling online access to electronic versions of books. The titles will be available for viewing on any Web-enabled device, be it a cell phone or a laptop. "By end of this year we hope to give publisher partners an additional way to sell their books," Google said in a statement on June 1.

Details, including revenue-sharing arrangements with publishers, are still being worked out, one major publisher told BusinessWeek.com on condition of anonymity. Google also expects to form partnerships with other online retailers, such as local bookstores, so those sellers could provide instant online access to books.

The plan to sell e-books is the latest indication of Google's attempt to expand beyond online advertising and gain a toehold in e-commerce, where Amazon.com (AMZN), eBay (EBAY), and Wal-mart.com (WMT) hold sway. "Google's core growth rate is slowing, and it's starting to look for the next big growth driver," says Laura Martin, an analyst at Soleil Securities Group. In February, Google's YouTube said it is testing ways to let people sell video through the Google Checkout online payment system. Google is also testing Google Product Search, which lets consumers locate the cheapest products at various online stores. Google also runs Android Market, a store that sells mobile-phone applications.

Combined with other Google e-commerce tools and the company's arrangements to make books available online, the e-books project has the potential to increase competition for Amazon and other online booksellers. Technologies that undergird Checkout, Product Search, and Android Market could serve as the basis of an online Google e-bookstore. "Certainly, they've got all the parts they need in place," says Jeffrey Lindsay, a senior analyst at Sanford C. Bernstein.

Some publishers may welcome an Amazon rival.

Selling new books would complement Google's existing plan to take online more than 7 million out-of-print and other books. Some publishers may opt to ally with Google in hopes of bolstering a competitor to Amazon, Marianne Wolk, an analyst at Susquehanna Financial, wrote in a June 1 note. Some publishing houses "fear Amazon will garner the same 70%-plus share of e-books that it has captured in online book sales," Wolk writes.

Amazon says it's not worried about the competition. "We don't focus on other companies; we are focused on offering our customers the best possible reading experience," Amazon spokeswoman Cinthia Portugal said in an e-mail. Sony (SNE) has teamed with Google to make many public domain books available to users of its Reader device. The company says it hasn't entered into an agreement with Google around this latest announcement.

Google could grab $100 million to $200 million in revenue from e-book sales in the next five years, Martin estimates. The global market for e-book software, which is currently dominated by Amazon but also features formidable players such as Sony, is growing fast and is expected to rise to $400 million in 2010 from $150 million last year, according to market researcher Outsell. Amazon doesn't release data on sales of Kindle devices or e-book downloads, but CEO Jeff Bezos said in May that when a Kindle version of a book is available, it makes up 35% of the title's sales.
For Google, which generated $5.51 billion in sales in 2009's first quarter alone, e-book sales would be a drop in the bucket. Still, e-books could serve as a test for sales of all kinds of digital content, such as music and videos, says Sucharita Mulpuru, a principal analyst at consultant Forrester Research (FORR). U.S. online sales have held up despite the recession, with nontravel-related purchases expected to grow 11%, to $156.1 billion this year, according to Forrester.

Some analysts even speculate that Google, which doesn't make hardware, may follow Amazon with its own e-reader, says Forrester analyst Sarah Rotman Epps.

Increasing the heat on Amazon wouldn't alone guarantee Google's success. "They have no track record of adding another revenue stream," Martin says. The compan has yet to make money on its forays into social networking, mobile-phone software, and online video clips.

Google Could Undercut Amazon on what publishers pay.

Even established e-commerce players like eBay are struggling. "If eBay can't show growth, it's clearly going to be difficult for players to enter the e-commerce space," says Frederick Moran, a managing director at brokerage Benchmark. "But Google definitely has a tremendous brand name and following. If anyone can move into other areas of the Internet, Google is certainly among [such companies]."

Google could sweeten the deal for publishers by agreeing to keep a smaller percentage of the sale price than competitors do. Amazon hasn't announced the percentage of an e-book's price it takes, but it keeps 70% of newspaper subscription sales on the Kindle, according to a statement to Congress by Dallas Morning News CEO James Moroney. In May, San Francisco-based Scribd opened an online store for electronic books that lets authors and publishers distribute content at any price they choose and keep 80% of the profits.

Google's approach of making titles available online, vs. for download, could dispense with many technical hassles for the publishers as well. Today, developers and publishers typically have to go through the laborious task of adapting books to various devices.

And despite Amazon's lead in e-books—on June 1, Amazon announced it will soon start shipping its new e-book reader, the larger-screened Kindle DX that's better suited to college textbooks, newspapers, and business documents—the Kindle is expensive and available only in a handful of countries. "If Google gets into the space, it may force Amazon to get more aggressive with its Kindle," Lindsay says.

Kharif is a senior writer for BusinessWeek.com in Portland, Ore. Douglas MacMillan is a staff writer for BusinessWeek in New York.

Copyright 2000-2009 by The McGraw-Hill Companies Inc. All rights reserved.

Social Media Is the Great Equalizer for New and Growing Businesses

Social networking provides a very high ROI (return on investment). Small business owners who begin to implement a thoughtful social strategy will generally see results quickly in terms of growing visibility … increasing site traffic … an expanding network … better Google results — and all for primarily an investment of their time and effort (human resources versus capital outlay). That’s why it is such a good tool for new, small and growing businesses. And: Social networking strategies are equally accessible to companies of any age (new, expanding, established), size or location (urban or rural). Finally, a tool that levels the playing field for smaller companies

Entrepreneurship Remains Strong in 2008 with Increasing Business Startups

Activity rate increased among many groups including immigrants, women and older Americans and in all regions except Midwest, which had a slight decline

(KANSAS CITY, Mo.) April 30, 2009 — New business formation increased in 2008 but, in what may be a potential harbinger of the current economic recession, U.S. entrepreneurship rates increased for the lowest-income-potential and middle-income-potential types of businesses from 2007 to 2008; it decreased for the highest-income-potential types of businesses. This is one of the shifts in firm formation trends found in the annual Kauffman Index of Entrepreneurial Activity, a leading indicator of new business activity that provides the earliest documentation of new business development across the United States. Analyzing matched monthly data from the Current Population Survey since 1996, the Kauffman Index allows comparisons of new business creation over time.

"The overall pace of entrepreneurial activity did not suffer during the recession in 2008, which is great news. This is consistent with historical patterns, to the extent we understand them, which indicate that entrepreneurial activity is largely insensitive to the economic cycle," said Robert Litan, vice president, Research and Policy at the Kauffman Foundation. "So far, at least through 2008, this pattern is holding up."

Overall, the 2008 entrepreneurial activity rate increased slightly over 2007. An average of 0.32 percent of the adult population (or 320 out of 100,000 adults) created a new business each month—representing approximately 530,000 new businesses per month—as compared to 0.30 percent in 2007. While entrepreneurial activity has remained generally consistent over the past decade, the Kauffman Index points out important shifts in the demographic and geographic composition of new entrepreneurs across the country.

Key findings include:

• The oldest age group—ages 55 to 64—experienced a big increase in business-creation rates from 2007 to 2008 and, as a result, has the highest level of business creation (0.36 percent).
• The activity rate increased sharply for immigrants in 2008—from 0.46 percent in 2007 to 0.53 percent in 2008—further widening the gap between immigrant and native-born rates. Although the increase in entrepreneurship rates among immigrants was driven entirely by low- and medium-income-potential types of businesses, immigrants also are more likely than U.S. natives to start high-income-potential types of businesses.
• Latinos' entrepreneurial activity rate increased from 0.40 percent in 2007 to 0.48 percent in 2008, continuing an upward trend that began in 2005. Over the thirteen years of the study, Latinos have had the highest percentage increase in entrepreneurial activity (from 0.33 percent in 1996 to 0.48 percent in 2008).
• Asian-Americans' entrepreneurial activity also increased sharply, from 0.29 percent in 2007 to 0.35 percent in 2008. Non-Latino white business-creation rates increased slightly, while African-American rates slightly declined.
• Entrepreneurial activity increased from 2007 rates for both men and women (from 0.41 percent to 0.42 percent for men and from 0.20 percent to 0.24 percent for women).
• With the exception of the Midwest, all regions saw increased entrepreneurial activity from 2007 to 2008.
• The states with the highest 2008 entrepreneurial activity rates were Georgia, New Mexico, Montana, Arizona, Alaska and California.
• The states with the lowest entrepreneurial activity rates were Pennsylvania, Missouri, Wisconsin, West Virginia, Iowa and Ohio.
• Among the United States' fifteen largest metropolitan statistical areas, Atlanta had the highest entrepreneurial rate (0.74 percent) in 2008. Philadelphia had the lowest rate (0.16 percent).

"The total business creation rate increased over the past year, but this masks diverging underlying trends. Entrepreneurship rates increased only for low-income types of businesses and not for high-income types, which may be early signs of how the recession is impacting firm formation," said study author Robert Fairlie, professor of economics and the director of the Master's program in Applied Economics and Finance at the University of California, Santa Cruz. "The continuing effects of the recession on business creation are important because entrepreneurs contribute to economic growth, innovation and job creation in the United States."

Unlike other studies that capture young businesses that are more than a year old, the Kauffman Index captures all adults ages 20 to 64 when they first create their businesses, including both incorporated and unincorporated businesses, and those who are employers and non-employers. The Kauffman Index of Entrepreneurial Activity, defined as the percent of the adult U.S. population of non-business owners that start a business as their main job each month, is conducted annually.

2007 data show that external credit provides increasing percentage of financing as startups age

(KANSAS CITY, Mo.) April 8, 2009 — Now in its fourth year of data collection, the world's largest longitudinal survey of new businesses shows that external debt markets become increasingly important during startup companies' early growth years. In 2007, the 2,915 entrepreneurial firms surveyed injected an average of $53,000 into their businesses, with 62 percent of that capital coming from outside debt markets. By comparison, external debt markets provided 40 percent of financing in these companies' first year of operation.

These and other data were released today in the latest Kauffman Firm Survey (KFS), a Ewing Marion Kauffman Foundation-funded study of new businesses founded in 2004 and tracked over their early years of existence. The KFS fills a void in valuable data collection on young U.S. businesses, providing an understanding of how businesses are organized and operate in their early years, and shedding light on survival and growth indicators.

"This report highlights the importance of external financing for young business and sheds new light on our understanding of the credit constraints they feel," said Robert E. Litan, vice president of Research and Policy at the Kauffman Foundation. "In addition to studying actual debt and equity financing, the 2007 survey asked about credit applications. It will be interesting to compare these data with research on their financing in 2008, which clearly was a more challenging credit market."

The KFS started its baseline study with a cohort of 4,928 firms that began operations in 2004. This group of companies is tracked annually and asked detailed questions that cover a range of topics, including the founders' backgrounds, the sources and amounts of financing, firm strategies and innovations, and outcomes such as sales, profits and survival. The project has an additional four years of study planned. At the end of the project, the KFS will contain data from 2004 to 2011.

Twelve percent of the firms in the KFS study submitted new external credit applications for debt financing in 2007. Of those firms that sought financing in 2007, 70 percent always received approval. Nearly 18 percent had mixed results, and slightly more than 12 percent of the firms said their loan applications always were denied.

For those whose loan applications were denied, almost half said insufficient collateral to guarantee the loan was a primary reason given for the denial. The second-most common reason was flaws in the owner's personal credit history.

Less than 10 percent of black-owned firms applied for new credit in 2007, compared with nearly 13 percent of firms owned by non-Hispanic whites. Seventeen percent of firms said they did not apply for credit at some point when they needed it because they feared their loan applications would be denied. Women and African-Americans were more likely than men and whites to have avoided applying for credit for this reason. Nearly 40 percent of African-Americans said they feared being denied, compared with 14.5 percent of whites.

Interestingly, however, among the group that feared denial, a higher proportion of firms—20.7 percent—applied for credit than those in the overall sample who applied (12 percent).

Other key findings from the latest report include:

• About 90 percent of firms that began operations in 2004 survived through 2005, while about 80 percent survived through 2006 and 73.4 percent through 2007. Most of the remainder of firms closed either permanently or temporarily over the period, while a small number, 3.5 percent, either merged with or were sold to another business.
  
• Surviving employer firms increased average employment from 4.6 employees in 2004 to 6.7 employees in 2007.
  
• About 40 percent of firms had revenues greater than $100,000 by 2007, compared with just 17 percent in 2004.
  
• About 17 percent of firms have a national market area, and more than 13 percent of firms had some international sales.
  
• More than 25 percent of firms sold at least some of their goods or services on the Internet. Nearly one-fourth of those firms had Internet sales that were more than half of their total sales.

  The KFS dataset is accessible to scholars worldwide, and all reports in the KFS series are available for download. The public-use microdata file and reports are available at http://www.kauffman.org/research-and-policy/kauffman-firm-survey.aspx.

Small Business Technology & Quality Assurance

As strong markets for U.S. exports was a highlight of the fading economy of 2007, according to The Small Business Economy (http://www.sba.gov/advo/research/sb_econ2008.pdf) report by the U.S. Small Business Administration's Office of Advocacy, it is a testament to the unyielding power of small businesses.

In 2007, as housing sales fell and energy prices increased, small businesses faced growing challenges. A year that showed strong growth in the second and third quarters ended with fourth quarter growth down an annualized 0.2 percent. Still, the economy generated 1.1 million new jobs, largely in the service sectors populated largely by small businesses. Small businesses continued to lead job growth in the first quarter, creating 74 percent of the net new jobs. But, by the fourth quarter, businesses of all sizes were cutting jobs. These trends continued into 2008 and 2009.

Small businesses ability to maintain and create growth is an indicator that the small business community will lead America out of its present state. With improved processes, previously only mastered by larger businesses, small businesses, we believe, may become the backbone of our entire economy.

To improve operational processes of a business, through a top to bottom analysis, a business owner must look at three things. 1) Technology and Quality Assurance, 2) Decreasing Operations Costs, and 3) Processes that are on brand.

In this article, we will discuss why creating and evolving a set of processes for all aspects of your business decreases costs. It's "Total Quality Management."

Processes are how the work gets done in your business; how products get manufactured; how money is exchanged; how services are delivered. Brand is the personality of the company; what your customer is forming a relationship with. If you don't have a process for everything you do, and things aren't continuously done in a consistent and intentional way, a company risks not only costly inefficiencies, but also a weakened brand. A weak brand = a weak relationship with customers.

It is impracticable to maximize business performance with flawed or inefficient processes. It's essential to continually improve your processes, eliminate waste, reduce costs, and increase efficiency in technology (web solutions in specific when speaking of small businesses). Take Toyota, for example. Company leaders have been working on constantly improving their business processes for over 50 years. Yet, they still don't consider their processes for manufacturing perfected and they continue to evolve them.

When you look at things from a process point-of-view, you'll find the root of the problem and replace it with something more effective and efficient (web design, search engine optimization advertising, brand strategy, and b2b marketing). Process improvements reduce costs by saving time, eliminating rework and redundant tasks and that translates into Profit Improvement. Your bottom line will thank you for changes … and your brand and longevity will be improved.

Historically, small businesses have been at a disadvantage in process development because they haven't had the resources of larger companies. Not anymore. IN:FUSE takes big business expertise to the small business market. For seasoned support in small business process improvement and to become more profitable in the current economic downturn, contact IN:FUSE now at 651.307.5593

An Intro:

Our specialty is crafting strategies and deliverables for our clients to help acquire,retain,up-sell,cross-sell, and win back their customers. At an extremely reasonable cost, IN:FUSE will provide the following deliverables to businesses –even those in their infancy or stagnant state:A full public relations and marketing campaign strategy:business plan composition,market analysis,financial modeling,and project implementation;If needed,communications support and development:business partnership formulation and company establishment;Significant site traffic guaranteed in just a few months: a complete website design and hosted plan,system driven content management,bookkeeping and accounting solutions,and tax preparations.Any service from IN:FUSE can be offered independent of any package.

IN:FUSE is a Twin Cities based company dedicated to small business sprawl and entrepreneurial growth within our communities.IN:FUSE is woman and minority owned and is devoted to seeing, what are classically untargeted market segments,ultimately become successful;IN:FUSE holds strong to diversity in its branding approach.

IN:FUSE is a team of seasoned professionals who strive to provide comprehensive, cost-effective small business solutions.
We offer expertise in business strategy, technology, brand strategy, communication, design services, legal, and accounting.
IN:FUSE provides a one-stop shop solution. Our price sensitive cost point enables start-up and small businesses to have access to industry standard technology and marketing strategies.
Our approach is focused on service, accountability, measurability, value and ROI.

IN:FUSE aspires to fill the void of cooperative economics between social programming (non-profit organizations) with business development (for-profit models).

Our specialty is crafting strategies and deliverables for our clients to help acquire, retain, up-sell, cross-sell, and win back their customers.

Attempting to bring about social economic growth through business
expansion is difficult for the entrepreneur. However, it is the only way.
Ideas are conceived by the individual.

Without the daunting restrictions of task management, the individual
is free to create and develop their ideas in an innovative and fearless
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The developed idea is then extended from the individual to the
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and globe.

IN:FUSE will be the guidebook for this journey.