Mistakes and Failures #2: Zavoom.com

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As you know, I don’t like to dwell on mistakes and failures. But successful people almost never talk about where they’ve gone wrong and it’s something a lot of people can learn from. Which is why, every once in a while, I’ll showcase one of my own mistakes or failures.

I do this for 2 reasons:

  1. So you can see I’m not perfect. :) I mess up a lot. The fact that I mess up a lot means I put myself in a position to succeed. A lot. ;)
  2. Hopefully you learn something from my mistakes and avoid them in your own current or future ventures.

If you haven’t been around these parts for long, check out Mistakes and Failures #1: LaunchALabel.com.

The Failure: Zavoom.com

Zavoom.com on Feb 04, 2003

Zavoom isn’t an actual word. I made it up. I liked the way it sounded, it was short, and I could brand the business any way I wanted.

So what was Zavoom? It was an “e-mail club” that I would run for local businesses. The idea was that I would set up physical e-mail subscription forms for each business (placed near their registers) and then add whoever signed up to an e-mail list specifically for that business. Then I would send out regular discounts and information for the business.

More info directly from the About page:

What is Zavoom.com?

The home of a very effective marketing program for local merchants utilizing the power of the repeat customer. If your business has walk-in traffic and would like to promote customer loyalty, then our marketing program will work wonders for you.

What kind of marketing program?

It is known as Local E-mail Marketing or LEM. Your customers subscribe to your own “e-mail club” which periodically offers them discounts on your goods and/or services. You can then send your “e-mail club” members special offers up to 4 times per month, bringing your business a nice little boost every time. You will also have the ability to send a special offer to our whole network of “e-mail club” members.

Do I have to run this “e-mail club” myself?

No, Zavoom.com will take care of everything for you. We will set up an “e-mail club” box in your establishment that will entice your customers to join. They simply fill out a very short form with their name and e-mail address agreeing to join your “e-mail club.” Any time you have an offer to send to your customers, you just let us know what it is and we take it from there. The names and e-mail addresses in the “e-mail club” box will be collected up to 4 times/month. Privacy is of utmost importance: we will never sell your customer’s information to another establishment.

Will I see immediate results?

You should start seeing results as soon as you have approximately 250+ “e-mail club” members. It should not take you longer than 1 or 2 months to attain this level of membership.

Will my “e-mail club” also be listed on Zavoom.com?

Yes, you will be listed on Zavoom.com with your very own Web page along with any special offer you give to new members. We recommend a 5-50% discount off their next purchase to entice them to join your club. Your Web page will also include your phone number, address, hours of operation, and 1 picture (a logo or a picture of your establishment). You can also include your Web site address and additional pictures as described below.

How much will I have to invest in this marketing program?

Your investment is based on which “e-mail club” package you choose.

Our packages are:

Silver:

· 1 Web page for your business on Zavoom.com

· E-mail your “e-mail club” a special offer up to 1 time per month.

· Up to 500 “e-mail club” members.

· Investment: $99 setup, $49/month.

· Only $49/year extra to include your Web site address and up to 1 extra picture on your Zavoom.com Web page.

Gold:

· 1 Web page for your business on Zavoom.com

· E-mail your “e-mail club” a special offer up to 2 times per month.

· Up to 1,000 “e-mail club” members.

· Investment: $99 setup, $79/month.

· Only $49/year extra to include your Web site address and up to 1 extra picture on your Zavoom.com Web page.

Platinum:

· 1 Web page for your business on Zavoom.com

· E-mail your “e-mail club” a special offer up to 4 times per month.

· Unlimited “e-mail club” members.

· A Web site link and up to 1 extra picture can be included on your Zavoom.com Web page free of charge with a Platinum membership.

· Investment: $99 setup, $99/month.

Annual Investment:

If you opt for the annual (once per year) investment, you will receive one month free.

How much is the investment to mail your whole “e-mail club” list?

To send a one time mailing to our whole list consisting of every “e-mail club” member on our network the investment is $59 per 1,000 members. This is a great way to add an extra boost of foot traffic and sales at any time of year.

To read one of the first sales letters I ever wrote check the Advertise page here (Archive.org link).

This was a fairly thought out business model, but a little bit difficult to explain. And there was one big problem …

Results

This may have been ahead of its time (although I did have data of a few restaurants that did it successfully). It was difficult to extol the benefits of an e-mail club to small businesses. Most small businesses (don’t get me started, many small businesses are run by absolute imbeciles) still don’t use any customer follow up method even though it’s easier and cheaper than ever. (Dumb, dumb, dumb, dumb, dumb, dumb, dumb.)

As for results? None. I didn’t sell any packages. But …

Why It Didn’t Work

I gave up too soon. I only met with 5 or 6 business owners before I gave up on this idea. The thing is, I’ve always loved marketing and sales, but I hated it in person. I’ve always been a bigger fan of the written word than the spoken word. Local lead generation works great. Look at Groupon and the ilk. My idea was not exactly the same, of course, but small businesses are far more open to local internet marketing now than they were in 2003. (Chad Frederiksen, more on him below, does a wonderful job at local lead generation.)

What Should I Have Done Differently?

I should have signed up businesses for free and charged them based on how much business I brought them. I’d probably have made much more money this way than a flat monthly fee I was charging. But again, I quit because I just didn’t enjoy face to face sales. Also, my other businesses were thriving by 2003 so money itself wasn’t motivation enough to pursue Zavoom.

Closing Thoughts

I look back on this idea with fond memories. I remember designing the site and writing the sales letter and I had a lot of fun with all of the internet based stuff. The offline stuff just wasn’t fun at all to me. I wasn’t comfortable on sales calls and I still wouldn’t be comfortable with sales calls if I had to make them today.

How Would You Have Made Zavoom.com A Success?

If the Zavoom “e-mail club” idea was yours what would you have done differently in 2003? What would you do today to make this work?

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If you’re interested in the local lead generation business model Chad Frederiksen (<– he doesn’t blog often, but his archives are worth a read), one of the smartest no bullshit marketers around, does it quite successfully. Check out his Local Lead Plan here.



27 COMMENTS

  1. Back in 2003, I would have done the same as you Karol, I would have given up after 6 attempts because face to face is just to much damn hard work. I much prefer leverage via the written word whilst many people prefer video because they just don’t like reading.
    If I where to use your model today I would do it as a facebook
    Marketing strategy for local businesses.
    2011 Internet leverage is so much more powerful than 2003. The more people you guide the more cashflow you generate.
    Systemize and succeed!
    Have a great Day.
    Leanne from Gold Coast Queensland Australia

    • Thanks for your input Leanne. I have a feeling that most people who have online businesses don’t want to deal with offline stuff, but there’s huge opportunity out there. That said, you’re spot on, 2011 leverage is much more powerful than 2003. :)

  2. Karol,

    I don’t have a business degree…nor am I super savvy business-wise, so I can’t wow you with my fantastic business buzzwords, or some awesomely mind-blowing business theories. Therefore this is an opinion from a complete novice…

    2003 was right when MySpace was starting…it was pre-Facebook and pre-Twitter. While loads of people had e-mail addresses at the time, that was the about the extent of their technical prowess…and many of them only used e-mail for work purposes. (I work for one of the largest medical institutions in the country–and did back in 2003 as well–and we only used e-mail occasionally for business at the time. It wasn’t even our main form of communication then and they didn’t even have computerized pay stubs at the time.) I know that most people I knew at that time had never used the internet to shop—nor did they trust it. They were positive their identities would immediately be stolen. From what I remember of my own experience—snail mail coupons were still very much the main thing. And printing off a coupon from e-mail would have blown a lot of people’s minds…at least in my circle.

    Taking that into consideration–I believe your idea was ahead of its time. I also agree with the points you mentioned in your article. And after re-reading Leanne’s comment above—she pretty much said the same thing, so I’m being redundant! ;) Combine that with the fact that face to face sales is excruciatingly painful for most people (I have an immediate and intense distrust of salespeople…so I loathe being the one having to do the selling as a result.) —it’s understandable that Zavoom didn’t take off as you’d hoped.

    Again–it’s just an opinion from a non-business minded, healthcare worker…and yet I still feel compelled to share it.

    Cheers,
    Conni

    • Great points Conni. Although e-mail/internet was far more advanced than you make it seem, this was post dot com crash so lots of people were leery. Anyway, it was a fun time, and hopefully somebody uses this failure to do something great. :)

  3. Although failure sucks I have really enjoyed reading both articles in this series. I would love to read more “Mistakes and Failures” (not at your expense hopefully) just because I believe success is a road built with failures. Does that make sense? Anyway, thanks Karol your awesome!!

  4. If the goal was to make the business a success, finding someone you could team with that could deal with the face to face interactions would have been ideal. There are a lot of people that can talk to anyone and enjoy that aspect of it. Others, like myself, have learned it over the years.

    My bro, as you know, tried an online biz idea back in 2008??, maybe 2007, man I forget already. Point is, he has no issue talking with people, but what he found was that small biz still didn’t see value in what he was pitching. The avg biz owner in our community was too old. They were too far removed from the internet and what not.

    I have no facts behind this, but I would bet that the people that make groupon successful aren’t 50 yr old business owners, but rather +25-40 yr olds that either grew up with it, or were in the window of still wanting to learn. I don’t think my mom would know what groupon is. She is texting these days though:-)

    My thought is, your idea has a better chance of working today that my bros. His idea would be great in 10 yrs.

  5. This was a really good read. I often see “success this!” and “success at that!” posts, but rarely anything about other failed (learning) attempts. There are normally so many learning trials and the lessons learned from them carry over into future ventures. Thanks Karol for continuously posting about your successes and the learning experiences that got you there.

    • Thanks Mark. Success posts are more fun to write and more fun to read. Nobody wants to read about what went wrong. That’s why people play the lottery. It doesn’t matter that millions of people lose. 1 person wins! :) I personally learn a lot from the mistakes so I enjoy sharing every once in a while.

  6. Karol,

    Great post! Thanks for including all the details.

    I agree with Kenny about partnering with someone else to make the sales. I would go with someone right out of college looking to get into sales.

    Then, I’d give out 3 months FREE and help them build it up so that by the time it is really kicking, they will LOVE it and you.

    • Thanks for your input Benjamin. Giving 3 months free is bad business unless you’re rich and you can float for that long. Unless you’re giving them the 3 free months but taking a cut of sales.

      • Not sure about ‘bad business’, but you would need enough money to survive for that long or have other projects that were already providing income.
        Plus, you would have to include some sort of incentive or punishment (like lose contact with the list) to stick with you after the 3 month period.

        My aunt is a small business owner (veterinarian). Doesn’t have a clue about technology, but loves dogs and cats.
        A company set her up a little website, collects email addresses of customers, sends out customers appointment reminders and birthday greetings, and other stuff.
        She signed up because they gave her 1 year free. I asked her about it and she is certain she will stay with them, because they are doing it well and she doesn’t have to think about it.
        But if she would have had to pay for the service, she never would have done it.

        • Giving away free business for 1 year is insanity. If a business owner can’t see the value in a service after you send them new customers just once then they’re not a good customer (and not good business owners themselves).

  7. In 2003 I would not have done much differently.

    But today? I wonder if you still have the domain… and if you would pursue it with local mobile marketing.

    That is what I would do. That is what I do, actually. But so different than your model above, yet now you have my juices flowing and I’ll be mulling over how/if I can/should make changes and tweaks or even just add a different business model to what I already have going…

    I agree 100%: the opportunities now are phenomenal! (Might even go so far as to say: ridiculously extraordinary!)

    Even for our simple local based business here in Germany (one I started for my kids to teach them the ropes) we dominated page one of google for our choice search term: top 9 positions page one. This was within 4 weeks of setting up shop.

    We were surprised to get a request for an offer to serve on the HannoveMesse. Wow! And I added into the offer the actual service I do (local/mobile online marketing for offline companies and businesses).

    Thanks for sharing, I agree with Sharrod: great learning opportunities from your mistakes and failures.

    • Thanks for your input Andrea! I do have the domain, although I’m not interested in resurrecting this business (focus!). That said, would love to speak with you about what you’re doing. It sounds great! Please get in touch (KarolGajda at Gmail) if you’d like to chat.

      • Love to chat. I’ll come back at ya next week, we have a popcorn machine rental this week (it is the brick’s and mortar business for my kids… 13 down to 4 years of age… we have learned heaps so far!).

        I assume the greater interest is on the local mobile aspect of it (which would coincide more with your post here) or are you also interested in the kid’s entrepreneurial lessons and what our goals are with that? (That is also really cool and pumps me big time.)

  8. Couldn’t agree with you more. Teaching kids to use a blog cms to market in the offline world is to teach them the best of entrepreneurial skills… More next week.

  9. This post was very useful to me. Thanks.

    I like the part about “most businesses are run by imbeciles”. This has been a huge “aha!” for me, although I am struggling to internalize it. I often assume wrongly that other people are always seeking to optimize their lives and read up about new ways of doing things (because that’s what I do myself). But it seems that a lot (maybe even most) of people don’t even read blogs! ;)

    Do you think the Zavoom business idea could be cloned and could work in other countries than the US? What are some good conversational “scripts” for selling the idea to local businesses? Should the pitch be made via phone or by showing up in person? Tips would be very welcome!

    • Hey Alex, the idea should work, adapted to current times, anywhere. I have no scripts. In person sales to offline businesses always works best.

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