Topics

Understanding the ins and outs of financial management is important for every consumer. Being educated on managing their credit, understanding the impact of a credit score, or grasping simple bookkeeping can be intimidating without the proper training. When it comes to business owners, it is even more important, because improper management of their finances can be detrimental to their bottom line. However, with current regulations in place, it makes it difficult for consumers and small business owners to know where to turn to seek out advice without having to pay a steep price for assistance. Currently, Congress is reviewing legislation that would remove some of these challenges to further the development and delivery of personalized credit education. While the legislation would have an obvious benefit for consumers, it could also help improve the financial standing of entrepreneurs and small businesses owners. The fact is that many business lenders often rely on the commercial credit of the enterprise and the personal credit of the business owner when extending lines of credit. This is especially true for sole proprietorships and partnerships. Small business owners want, and need access to personalized credit education It’s estimated that more than 120 million credit score disclosures (key factors that may adversely affect a consumer’s credit score) are delivered to consumers each year when they apply for a mortgage, are denied for credit or are offered less than favorable terms on a loan. The number of score disclosures is likely to increase with the growing number of lenders providing credit scores to consumers on their monthly billing statements. Transparency of credit scores is a good thing, but a score disclosure simply cannot help consumers answer the question, “How can I improve my credit score?” For this advice, they often turn to the credit bureaus that generate the score. However, credit bureaus are only permitted to provide general information regarding a consumer’s score. They are unable to provide personalized steps to help consumers understand what they need to do to improve their score. This is primarily due to a little known federal law — the Credit Repair Organizations Act (CROA) — being misinterpreted. CROA stands in the way While CROA has been effective at shutting down credit clinic scams, it has recently been misapplied by the courts in a way that has had a negative effect on innovation and competition in the credit education marketplace. For example, CROA requires consumers to wait at least three days before they can receive the requested services. In today’s interconnected world, requiring small business owners, let alone a consumer to wait three days for timely and personalized credit education simply doesn’t work. A recent joint study from the Policy and Economic Research Council (PERC) and Take Charge America Institute (TCAI) at the University of Arizona, entitled “Is CROA Choking Credit Report Literacy?” sheds new light on the barriers that consumers and small business owners face when accessing the innovative tools that provide individualized credit education to help improve their credit score. The study finds that even after accounting for different price points, including free access, CROA’s requirements may be deterring the people who need such services from taking advantage. Even when it was free, just 31 percent of consumers hit the registration page after exposure to disclaimers on the landing page, and just 6 percent completed the process after the three-business day mandatory wait. Furthermore, 46 percent of consumers indicated that they would have used the credit education product for free if they could do so without having to wait three days. Reform holds potential for small business owners, especially women and minority-owned businesses Changing this law to enable the CFPB-supervised credit bureaus— those best positioned to help consumers in this area — to provide credit advice would have tangible benefits for consumers and small business owners alike. The PERC/TAIC report found that innovative credit education can lead directly to positive financial behaviors. Of those that successfully completed the personalized credit education service experienced positive material impacts (moving to a better risk tier) at nearly twice the rate of those receiving educational materials only. Reform can also be vital to helping women and minority-owned small businesses get on level footing as small businesses owned by men. A recent analysis released by Experian found that a gender gap exists in both commercial and consumer credit files: The average commercial credit score for a woman-owned business is 34, while the average score for a male-owned business is 35; The average consumer credit score for women business owners is 689, compared to 699 for male business owners; More than 22 percent of male-owned businesses have at least one open commercial trade line, while the same can be said for only 18.5 percent of women-owned businesses; In the last 24 months, female business owners had an average of 1.3 personal accounts become 90-plus days past due, while male business owners had an average of 0.9 go delinquent. It is possible that the lack of parity in access to credit has had a direct and quantifiable impact on the bottom lines for women-owned businesses. For example, Experian’s analysis found that more than 24 percent of male-owned businesses have sales that exceeded $500,000, while only 14.5 percent of women-owned businesses see sales of that size. In addition, 21.2 percent of male business owners have a personal income of $125,000 or greater, compared to just 17.4 percent of women business owners. Similarly, in a July 2014 report entitled “21st Century Barriers to Women’s Entrepreneurship,” former-Senate Small Business Committee Chair Maria Cantwell (D-Wash.) found i that $1 of every $23 in conventional small business loans goes to a woman-owned business. While improving access to innovative credit education is not a cure all, small business owners still need to develop solid business plans. However, personalized credit education could go a long way towards helping entrepreneurs improve their personal credit standing so they can access the affordable rates and terms needed for operating capital or a startup loan. Congress must pass legislation to remove regulatory barriers standing in the way of innovative credit education To help remedy the situation, Congress should pass H.R. 347, the Facilitating Access to Credit Act of 2014. The bipartisan legislation introduced by Reps. Ed Royce, R-Calif., and Ruben Hinojosa, D-Texas, would exempt reputable nationwide Consumer Financial Protection Bureau –supervised and examined credit bureaus, such as Experian, from CROA’s requirements. The legislation also would ensure that the statute’s critical consumer protections still could be enforced against unscrupulous credit clinics. Recognizing the positive impact of CROA reform on financial literacy in the communities that they represent, several national organizations have signed on to get behind this important effort. Policy resolutions supporting reform of CROA have been adopted by the National Black Caucus of State Legislators, the National Hispanic Caucus of State Legislators, the National Bankers Association and the United States Hispanic Chamber of Commerce. The bottom line is that financial education is extremely important. What is even more critical is the ability to have organizations that are qualified to provide the tools to improve credit standing and advice on how to utilize them. In the end, this will not only help consumers enhance their own financial experience, it will help small business owners be better prepared for potential growth opportunities and stimulate the economy.

Small businesses who send direct mail advertisements to their customers find this to be a highly effective marketing strategy. Where emails can be deleted immediately or never even looked at, people still head to their mailboxes daily. According to the United States Postal Service, 98 percent of people retrieve their mail daily, and 77 percent of people sort it immediately. This gives companies access to an audience who could potentially seek out their business right away. With direct mail marketing, there is a high potential Return on Investment because this type of advertising is extremely targeted. Small businesses can market just to the consumers they think will be most likely to purchase from them - rather than mass advertising through television on email campaigns. Direct mail proves to be a more personal way to reach potential and existing customers, and it encourages businesses to build a relationship with their customers. There is measurable feedback on direct mailing campaigns because businesses can directly count how many responses they see to their advertisements or how many people use their coupons, for instance. To make the best use of direct mail marketing, businesses can purchases data append services to update and provide more information to their existing prospect or customer lists. They also can purchase mailing lists relevant to the types of people they are looking to sell to in order to best target prospects in the area. Sources http://www.delivermagazine.com/2012/01/outside-the-box-direct-mail-continues-to-prove-its-worth/ http://oneims.com/blog/2010/03/22/6-benefits-of-direct-mail-marketing-campaigns/ https://www.usps.com/business/direct-mail-benefits.htm

When it comes to your employees, avoid these two common business mistakes.

4 ways to navigate launching a new business with a family member.

Today’s social media platforms represent enormous opportunity as well as enormous risk, as users increasingly share their opinions about businesses they frequent. If you aren’t paying attention to what your customers are saying about you online, then you’re leaving yourself open to their negative comments, while also potentially losing opportunities to react to positive reviews. To help manage your online reputation proactively, it’s imperative that you reach out to customers and ask for their testimonials. You can then use these positive reviews to implement reputation management strategies that attract positive attention for your brand. For instance, incorporate user review features on your Website that allow your customers to review products they purchase from your company. When a customer makes a purchase, send a follow-up email, allowing enough time for the item to ship and the customer to receive it, and ask for a review. You can then post the reviews on Facebook and Twitter as well as incorporate social features on your site that let users share their reviews, “like” your products and so on. If you fail to nab these opportunities, then you’re leaving it to your customers to post their opinions in their own social pages, where you likely won’t have an opportunity to respond to their comments. You also risk having these comments dominate in search engine results, as opposed to having the positive outweigh the negative. With proactive reputation management, you’ll create a positive impression with your customers. You’ll also have a better chance of getting more customers, as prospects read the good reviews and make their buying decisions.

Getting buyers to your Website is only half the battle in terms of your online marketing efforts. Once they’re there, you want them to buy — not click elsewhere or, worse, get nanoseconds away from a purchase only to abandon their shopping carts. It’s these abandoned carts that can be the most baffling. How could they get so close to buying and then simply click away? The answers are complex, but there is hope. Try out these five simple strategies, and start increasing your ecommerce conversions today: 1. Keep it simple. How many people do you know who like filling out long forms? Probably not many. Limit the first page of your checkout page to requesting the customer’s first name and email address. The reason is twofold: You’ll keep the customer engaged and moving quickly through the checkout process, and you’ll also have his or her contact information in case that customer abandons the cart. That way, you can initiate an abandoned cart nurturing campaign via email if necessary. 2. Follow up quickly. Re-engage with abandoned-cart customers right away, at least within 24 hours, to reinforce the reasons they wanted to buy your product in the first place. The more you can remind them of the connections they had with your brand and your products, the more likely they will be to revisit your site and complete their checkout. 3. Be helpful. Don’t assume your customer abandoned the cart because of price. Instead, follow up with an email expressing concern that a technical error may have prevented the customer from completing the order. Use it as an opportunity to highlight your competitive advantages, such as above-and-beyond customer service and unbeatable quality. Include a customer service phone number in case the customer wants to speak with someone or needs help completing the checkout. 4. Make a special offer. Your first or second follow-up email can include a coupon as an incentive to complete the purchase. Doing so will increase your conversions, particularly if the customer abandoned the cart based on pricing.  5. Be persistent, but not pesky. If your initial first or second emails don’t result in conversions, try offering more information about the product or your company. For instance, it’s a good idea to have some customer case studies and testimonials in your back pocket from customers who have raved about your products. Gently remind customers about your business without overwhelming them, as too many emails could mean opt-outs. By addressing multiple concerns in your abandoned-cart email campaigns, including shipping concerns, product benefits, pricing considerations and more, you’ll be more likely to touch on the reasons that a customer clicked away. These automated messages can prove priceless for your conversions.

A business’s success in Direct Mail Marketing depends on the type of the business and how diligently it is done. There are certain businesses that are a great fit, especially the ones that require building a local presence or presence in defined geographies. However, there are certain businesses that are not such a good fit. For example, businesses that rely primarily on internet users and have products and services that can be consumed only in the online context. Never the less, Direct Mail Marketing offers certain advantages that set it apart from other marketing channels – 1. Directly targeting your customers A good quality mailing list, crafted with the right selections and purchased from a reliable and reputed source that updates their data frequently, can help you connect with people who are more likely to be interested in your products or services. Whereas if you focus on internet traffic only you are likely to get generic visitors who may or may not be interested in buying from you. A mailing list can help you targets women, seniors, other businesses etc. There are a number of Demographic and Behavioral variables available to select the right audience for your business. 2. Flexible spending Direct Mail Marketing Ad campaigns give you the opportunity to spend as per your budgets. Sending postcards, letters or brochures is a cost effective solution to get your message in the hands of your customer. You can also choose to have your offer included in coupon books that have a large reach and the cost is split with other businesses. 3. Reach more customers For most small businesses, a number of their potential customers are not computer and internet savvy. Direct Mail Marketing helps reach that segment which is not likely to find your business or learn about your products on the internet. And even if most customers were using the internet, just by building a website you cannot make sure that they will frequently visit the site and purchase from it. Direct mail will end up in the hands of the people that you select and the communication will be tailored for them. 4. Promotions and deals increase sales Sending promotional offers and coupons that are tied with holidays or major events for your customers (for example their birthday or anniversary) can be an effective way to realize sales growth. And doing that on a regular basis with controlled pricing segmentation can even impact the life time value from those customers. In summary, Direct Mail Marketing can offer many advantages that other marketing channels don’t, as long as the campaigns are designed and executed well.

If you’re regularly sending emails to your customers, then you might already know the value of email campaigns. With a low capital outlay required and a high potential for return on investment, email is one of the lowest-cost marketing mediums you can employ. There are, however, special considerations for email marketers hoping to capture the attention of users viewing their emails on mobile devices. If you don’t how many of your recipients are viewing emails in this way, then you could be missing out on sales from a critical segment of the population. By following the simple tips below, you’ll engage mobile users and convert them into buyers — thus broadening your customer base beyond the traditional email inbox. Offer both HTML and text versions of your emails. This is the simplest way to ensure that all users are able to view your messages. Survey recipients from time to time to determine their preferences for either HTML or text emails. Restate your offer or subject line within the body of the email, preferably as the first line of the message, right before “If you can’t view this message, click here.” Users will be more likely to read and act on your message if they can instantly understand your offer. Side note: Make sure your subject line is concise and that it clearly conveys your offer. Track responses. Measure which recipients are opening your messages on mobile devices, and segment them into a special group if they represent a significant portion of your audience. Incorporate social media. Customers who use smartphones likely access Facebook and Twitter and would be interested in following you on these social mediums. Include your social media URLs or icons on every email so that you’ll build a social media fan base. With consumers increasingly using their smartphones to access information, mobile marketing must be a key element of your email marketing campaigns. The good news is, it doesn’t take much to incorporate it into your business strategy and begin reaping the rewards.

Conduct your own competitive analysis from your customers' perspective. Knowing and understanding what the customer sees is the most important competitive anlaysis you can do.