24 July 2010

Is there a recession? Was there ever a true recession like back in the 90’s? For me it seems very different. Back in the 90’s everyone was effected. I don’t remember anyone escaping the pain inflicted by the job losses and hiked interest rates. The recent recession which was announced by Tony Blair officially before we actually were in one has felt very different for me and a great many of my customers.

Yes people do seem slightly more cautious. But this is partly to do with the fact we were told we were heading for recession. I remember backing out of a property deal after the Nothern Rock crisis. Thank goodness Gail and I plucked up the courage and pursued the deal, it was Castell Cidwm, the UKFast training property which is now an integral part of our successful recruitment and training strategy.

The reason for my comments are not flippant, I know a great many people have been through difficult times, my point is this. Is this a recession, or is it merely a change in the way people do business? What do I mean by this? Well, it is safe to say that people have changed the way they buy things.

When you purchase something there are 2 decisions that you make.

1/ do I want/need this product or service?

2/ where shall I buy it from

In the old days! People went to shops and bought there and then.

Then came the internet. Now people looked online, researched and then once they’d narrowed down what they wanted, they headed to the shops and bought it there.

But, then came the new era. An era of confidence where people simply go online to do research and then simply buy it without hesitation.

Well this is a massive shift. It surely makes sense that if you as a business have not embraced this you are going to be in a huge amount of trouble.

I believe the cultural shift in how we buy is SO extreme it is literally wiping businesses out who do not have a credible online presence. Look at Woolworths, they felt that the internet would not work for their business. Yet Argos who embraced it is now one of the biggest online retailers in the world.

I was at a round table this week discussing the economy and budget. I heard numerous businesses explain that they had zero growth. The same businessmen stated clearly when I asked them do they use the Internet to attract new business, “people  in our industry do not use the internet to research our product!” The irony is I have helped a few businesses in the exact same sector generate millions of pounds worth of new business, all via the internet! But how do you educate people who simply do not believe it is possible. These sort of limiting beliefs are lethal and often are the main reasons why businesses simply stop evolving.

If only I got a pound for every time I heard business people say “my customers wouldn’t use the Internet!”

Over the years, I have won a few £1 bets to people I have met at Sale Sharks who said, exactly that.

Caunce O’hara, now giants in the Insurance industry were about to spend a fortune on a website. I asked them to consider a different option. For less money I helped design and build a new system that not only worked out an accurate price for the insurance premium, it took the money and attracted new business. I won my pound.

It’s not a business model I’d advise people to follow, I am lucky enough to be able to do this as a hobby as I have a huge R&D team, I also have done this enough times to know, I’d succeed.

I have done the same in a variety of industries. Debt management, clothing & retail, one business in particular (again who said it cant be done) is now invoicing more than £1,000,000 per month from online sales!

I can guarantee these people dont think we’ve just been in a recession.

The problem is, “you don’t know what you are missing until it is too late.” It’s people’s own shortsightedness that is simply holding their businesses back, or in some cases damaging their business.

I have 15 year old kids who are customers and a great many small businesses who are doing extraordinarily well. It’s never the brands who are riding the crest of the wave, they simply think they are. A lot of the high traffic sites are below most peoples radar. The people who win, are the ones who realise that customer experience is everything, and they build a super fast and effective site and host it on a dedicated server for that added umph. Before they know it, they are getting customers from Google, and the customers are coming back in their droves because the experience is perfect.

When we explain to people that their site is slow, they don’t understand. They look at their own site and say, “it seems fast to me!” This is the biggest misconception. They are ususally viewing a cached version of their website on their own local machine. What does this mean? Well basically, your machine stores images of sites that you visit regularly. So it stands to reason that when you look at your own site, you do so though rose coloured spectacles. You are in effect getting an artificial view of how your business is really NOT performing.

On the flip side through your customers eyes, it doesn’t hide the harsh truth, that for new visitors, your site is like jelly waiting to set.

This is particularly noticeable for people who end up hosting in the US to save money. People can simply drop out of the UK arm of Google once the search engine picks up the foreign IP address. Google simply assumes that your main focuss is probably aimed at the foreign market, as your site will perform better in the country where it is hosted. Some of the largest hosting providers in the UK, host their customers in the US and Germany. Amazon host thousands of their clients sites in the US on their Cloud environment. One and One (1&1) a German company who also own Fasthosts, who market themselves a the hosting worlds market leader , host their servers in Germany!

Personally I believe keeping it simple is the best way. Host your site as near to your customers as you can. We are lucky, by being in Manchester we couldn’t really be more central to the whole of the UK.

I hear horror stories all the time on this subject. One thing worse than going abroad to host, is taking it in house! The ultimate in stupidity. Let’s stick our server on the end of our broadband connection or a leased line. So what if it is 100Mb. You may as well attach it via string! Yes it might work occasionally but not enough to get noticed on the search engines. Telcos for years simply resold 100Mb lines time and time again, and guess what? They attached them to a 100Mb line. The ultimate in bottlenecking.

If you imagine the internet works on the basis of regions. You can host your store on the main high street, the Oxford Street or you could host it on a back street. Which gets more traffic? Obviously the high Street. Yet so many businesses spend 10’s of thousands of pounds on their websites, yet they think they dont need to invest in their hosting. They think they can simply stick it on some shared space, or a cheap dedicated server (down a back street). Even worse, they dont realsie why it doesn’t work properly or why they dont get awesome results.

At the same time, we come across small businesses who take our advice or dip their toe in the water with UKFast. Experience the speed of the UKFast network and then get addicted. These companies listen to their customers and upgrade every time their site slows down by a fraction. These are the businesses who are the next generation. It is not the brands you know about, these are the new kids who a carving out a new horizon. They not only get my vote, they get my help and support in every way. They are the entrepreneurs of tomorrow.

So be warned. If you have a business and you are NOT taking your online marketing seriously, or worse still you are spending the bulk of your budget on the design and leave nothing for the location of your window to the world, you will not get the results you are wanting, but you will get what you deserve.

This does sound harsh, but it is a really harsh world out there.

If you are a web developer or you run a business designing sites, if you are hosting your sites on a single server to save money or to create a revenue stream, although you may think you are doing your client a favour, you are actually suffocating their business. If you wish to try a server to see the difference, drop me an email at UKFast or post me a comment. Every business I have tried this with has increased sales. Its not  rocket science, but it will certainly pay for one!

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