Fine tuning the online marketplace

iFocus founder Greg Muller saw a gap in the online market that he thought he could service, which six short years later has him looking at $6 million revenue. He tells AMANDA GOME the iFocus strategy.

Greg Muller started online services and solution firm iFocus in 2000 when he was 26. It now has three offices (Melbourne, Sydney and Brisbane), 35 staff and is aiming for $6 million revenue this year (currently it has $4.6 million.) He tells Amanda Gome how he did it. Any questions? Email feedback@smartcompany.com,au and Greg has promised to answer.

Amanda Gome: Greg, what niche did you see?

Greg Muller: The niche I saw was the gap that sat between the buyer of online services and solutions, and the designers/technology vendors who wanted to build/implement a solution. What we saw in the beginning was a lack of research, planning and good solution design being done.

As a result, solutions delivered were short term and not delivering the underlying business benefit. We felt that by bringing methodology and rigour into the market (and leaving designers and vendors to do what they do best) we could capture a part of the market traditionally filled in other industries by the likes of business consultants, project managers and architects. In addition, the web was new, and clients needed advice and direction, so our position was focused around being a partner, guide and trusted adviser.

What was your strategy and how did it change?

Strategy was pretty basic at the start.

1. Get the name out (by employing a business development representative within a month of start).
2. Convince prospective clients that taking a considered, structured and longer-term perspective for their online program was good business (this wasn’t too hard!).
3. Establish relationships with other firms to leverage their experience/name.
4. Not pay ourselves, work our guts out and offer company share incentives for foundation staff members.

The fundamentals of the business haven’t changed – work hard, deliver quality work and look after our customers and staff. The market has changed though. It has:

• Matured.
• The players are stronger and more established.
• The focus is more “enterprise” and clients expect more business process and technical integration.
• Clients are more educated and their expectations have increased (meaning their tolerance for shoddy work, which we were seeing a lot of a few years ago, has bottomed out).

Our strategy going forward though is still pretty simple:

1. Growth (we are planning for compound growth of 20-25% per year over the next three years).
2. Extend capability (organically through training and recruitment and through acquisition of quality, niche firms).
3. Employer of choice (do whatever we can do to make working at iFocus the best all-round experience). We have just implemented an employee share scheme where all staff are given their own small share of the firm the moment they start at the company. The longer they are with us, the more that share is worth.
4. Strengthen resourcing and delivery supply lines (one example of this is by establishing international development partnerships).
5. Market positioning. We’ve just rebranded the firm with the goal to make it easier for our clients to understand who we are and what we do. We’ve wanted to raise the bar and I think we’ve done that. The challenge for us now is to get more people to experience more of it.

Your clients are medium to large businesses and large corporates. How do you go about selling to these corporates? How do you build on your relationship with clients?

Luckily, many of them seek us out now. In the early days it was all about using the network, doing small pieces of work (to prove ourselves) and building new relationships, quickly. Now, our focus is on generating word-of-mouth and tactical communications aimed at generating demand. Our people are also highly sought after speakers, so this helps to get you in the door. The next step is being able to communicate clear targeted industry messages.

One of your specialties is telling clients how to sell and market to teenagers. Tell us about Citizen 2.0. How does traditional marketing have to change to engage these teenagers?

Well, yes I suppose so. While I wouldn’t classify ourselves as a traditional marketing firm, we integrate tightly with our client’s brand and marketing agencies to uncover the strategy and then create environments that our client’s customers want to form part of, whether these are children, teenagers or the aged for that matter.

There is a massive difference between delivering a brand experience offline versus online, and respectfully, the ad industry themselves have really struggled with bridging the gap with the web. It’s because the web is different. The web is all about building confidence, trust and user control.

There’s too much crap out there on the web, and customers, especially those in our Citizen 2.0 profile, are totally desensitised to marketing noise – they want value, service and reliability, and will be able to rapidly filter what they don’t want. But what’s different to the physical world is the concept of loyalty – there isn’t any. You’ve noticed how customers online move in waves – for example where was Facebook three months ago, and where did they come from?

This is where an intelligent, well considered online strategy really pays off. This is where businesses need to understand the notion of an integrated user experience. Companies try hard and spend multi-millions to service their “offline” customers, but why is it that very few have a targeted strategy about engaging and managing an online audience, and how this audience integrates cross-channel and into the physical world?

The world is getting more and more connected to information, knowledge and services on a global scale. They’re getting more and more comfortable transacting online. Many are able to share their thoughts and ideas (and networks) more openly that at any other time in history.

It’s all about the customer and their needs and wants. Products will need to be able to be pulled apart and put back together how the customer wants them. Immediacy and customer control is key, but don’t expect loyalty as the fundamental nature of the internet is anonymity, choice and transience. Organisations who fail to look at their current ways of doing business, including studying their customer touchpoints and product strategies may well compromise their effectiveness and success online into the future.

What are three key factor to establishing online customer communities?

Well I think it depends on the community you’re trying to establish or build, if in fact you need to create a community. But what we see many of the key factors are having clear strategies around providing:

• Recognition.
• Control.
• Flexibility.
• Efficiency.
• Input.
• Immediacy.

Web.20 presents a huge challenge for marketers. What are three traps? What needs to change?

In many ways it goes back to the six points above. However, I believe the follwowing is important and where we can all get unstuck:

1. Don’t force feed. Let the customer choose, don’t assume you know how they think. However, a willingness to understand and show leadership is important.
2. Don’t flirt with usability. Users expect it and you will lose them in a flash if you compromise this one.
3. Understand how to interpret data. Web activity can tell you so much if you know how to interpret it. While things happen quickly on the web, we can see trends immediately and take action to leverage or counteract.

How are you changing the way you market in a digital age?

Obviously, we now have more tools we can add into our “marcom” arsenal. For us, it’s using the tool most appropriately to what we want to communicate, but we’re a professional services business and very different to many organisations.

Generally speaking, the digital age offers the ability to understand our customers and their behaviour more completely and accurately than ever before. Personalised and targeted communication is therefore more commonplace and the successful marketers understand their customers and their behaviour, and where possible try to create a trusted relationship with them. The success of these programs speak for themselves.

Can you describe your SEO and SEM strategy?

For our type of firm and the customers we target, generally speaking, we don’t (want to) rely on search engines for customers to find us. That’s also why we don’t buy large advertising space in the Yellow Pages for example. For us it’s all about generating word-of-mouth.

However, and it’s a big however, if someone is looking for us online (because they have heard about the work we have done), they need to be able to use a search engine to look us up and get to us straight away. We optimise our pages and implement clean, web standards code – the sure fire way of helping to get up the rankings. In-bound link building strategies are also important to our SEO strategy, but again we rely on reputable sites linking to us generally via our research and articles written about us. For others though, including many of our cleints, search optimisation and online marketing is crucial. However, it shouldn’t be done in a vacuum – it must form part of an integrated marketing plan.

How do you get large companies to stop thinking about ROI? What should they focus on?

Who said that they should stop thinking about ROI? ROI is critical to business, it’s just how you define your return that’s the contentious point. It’s often when organisations link the word “return” solely to the direct financial returns from the web channel is when it all comes unstuck.

Organisations are now starting to recognise that the web is critical to their business. We all know that the default method for researching something is via the web. Now someone may not buy over the web, but they’ve often used it to get all they need to narrow their selection and make a purchase decision.

For example, today I was searching for rainwater tanks to install at home. Lots of info available from a range of different sources – I now know generally what I want but I’ll make the purchase offline (mainly because the facilities aren’t available to buy what I want online; now there’s an opportunity for someone!). The organisation which will get my business may never know how I found out about their product (although I hope they ask me), but how can a financial manager discount the value that the channel has had?

What is your favorite blog and why? Favorite forum? Why?

You know I don’t regularly form part of one, mainly because I don’t have time, plus I would prefer to spend any spare time I have with my family and also I haven’t grown up with this type of communication and exchange. Having said that though, blogs and wikis will form a much greater part of how we will be building our internal staff community, a place where the team can share freely in a trusted environment that is totally controlled by them. As a multi-site firm, we think this asynchronous, immediate method of communication is so important to how we will build our culture and to shrink the geography that lies between us.