|Can you help invest $750K into a good business?
Barack Obama has just inherited $750,000 from a long lost friend. In discussions with various friends and professionals, he is looking at deciding between two businesses in which to invest his money.
The first business, called “Clever Sub-Routine” (CSR), is an Internet business that allows designated Web sites to play acoustical sound messages just slightly below the audible range of most human beings…but still able to be “received” by the unaware listener.
The Clever Sub-Routine business benefit is it delivers subliminal messages to the Web site visitor in a way that has shown an 80 percent increase in purchasing the Web site’s products and services. The second business, called “Peripheral Pet Marketing” (PPM), is an animal resource, ground-based business in which PPM takes advantage of the high number of pets in most urban areas that need to get out and play. One marketing strategy is PPM hires people’s pets at $2 an hour to wear bright-colored pet sweaters that carry various explicit marketing messages that promotes sales for PPM’s clients.
“Clever Sub-Routine” has presented a business plan that forecasts escalating annual sales profits from $100,000 in 2010 to more than $500,000 in 2015. One of the “business income models” is to make the CSR monthly fees very affordable at just $8.33 a month ($100 a year) so that CSR just has to get 1,000 Web sites to sign up for the subliminal message in the first year. Although CSR knows there may be some ethical and legal questions (subject to lawsuits), they want to be the first in the marketplace with this new program that makes Web site visitors much more likely to purchase. CSR has used the program at its own Web site with great results.
“Peripheral Pet Marketing” has presented a business plan that shows $150,000 in 2010, but because of the limited number of pets is expected to “top off” at $400,000 a year by 2012; however, because there are other animals that can be used for some time, this business is expected to be financially sound and growing for many years to come. Tweet about that.
Biz development principles
ROI (return on investment) is a performance indicator used to evaluate the efficiency of an investment or to compare the efficiency of a number of different investments. To calculate ROI, the benefit (return) of an investment is divided by the cost of the investment; the result is expressed as a percentage or a ratio. Return on investment is a very popular metric because of its versatility and simplicity. That is, if an investment does not have a positive ROI, or if there are other opportunities with a higher ROI, then the investment should not be undertaken.
ETHICAL MARKETING: Ethically responsible marketing will care about “honesty of its messages” with customers, employees, suppliers, the local community, society, and the environment. Such ethical marketing will not use “unfair” practices to entice or coerce customers into a purchase. There is considerable evidence that doing good pays in the long run…it pays to believe in the Golden Rule.
Time to dig deeper: Now, as you might imagine, two watchdog companies (no pun intended) have taken notice of both CSR and PPM. The consumer agency known as “Searching Ethical & Timely Issues” (SETI) has filed a lawsuit on behalf of consumers who purchased the various products on the CSR “infected” Web sites. Another consumer agency we have all heard about, known as People for the Ethical Treatment of Animals (PETA), is very upset with PPM and wants them to stop treating the animals in such a cruel manner…even though the dogs love the cute sweaters. Besides, the dogs can’t read the marketing messages.
Next, CSR sends an opposite sub-routine to the SETI Web site to cause their donors to start requesting their donations back, thus undermining the funding for the legal attack by SETI.
At the same time, PPM decides to have an “animal protest” outside of PETA headquarters where various animals, stylishly dressed of course, protest PETA’s interference with the animal’s right to make an income.
Test yourself here and then find the answers by e-mailing firstname.lastname@example.org.
1. Assuming Barack Obama needs to work in “Clever Sub-Routine,” how long will the ROI be?
a. The ROI will be better because he has “added value” to the business.
b. The ROI will be lower by the value of his reasonable salary.
c. The ROI will remain the same.
2. Which business has the larger market (the biggest potential to make money)?
a. Clever Sub-Routine because it has more websites to sell to.
b. Peripheral Pet Marketing because everyone can benefit from such advertising.
c. Clever Sub-Routine because its overhead will be lower.
3. Which Company has the better ethical standards in its marketing practices?
a. Clever Sub-Routine since it only affects human beings.
b. Peripheral Pet-Marketing since it only affects animals.
c. Neither because, in the end, only the Lawyers will win.
Sean Jackson is a business development attorney and instructor with more than 30 years of broad-based sales, business development and marketing experience. He has assisted multiple clients on business structures, systemic development, and strategic business growth.