A Smarter Approach to Small Business Marketing?

Sometimes, before you can figure out how to sell, you have to figure out who you are.

Good morning!

Today’s highlights: Relaxing mask mandates may be tricky for businesses. Carey Smith defends Jason Fried. And is Amazon killing restaurants?

THE 21 HATS CONVERSATION

How do we get more customers? Like most business owners, Shawn Busse, CEO of Kinesis, and David Nichols, CEO of Loupe, have asked themselves that question many times. Early on, they tried to answer it, as most businesses do, by focusing on the basic elements of marketing: logos, positioning, platforms, and the like. Over time, however, they came to a very different understanding—basically that before you can create an awesome message for a video or a website, you have to truly understand what’s awesome about the business. That has led them to take a very different approach.”

  • “It's like, we could hire one more engineer, or we could have a marketing budget. And we would always hire another engineer, right? Because we knew how to hire them.”

  • “I went from having a kind of mediocre business with an offering that lots of people could do—to be totally candid—to having a business that had something that nobody else was really doing.”

  • “We’ve worked with plumbers. We've worked with people who build houses. We've worked with very non-sexy businesses, and in fact, I kind of like those businesses, because I find them to be very genuine and earnest. And so helping them uncover what's awesome about them is really rewarding.” READ TRANSCRIPT HIGHLIGHTS

THE ECONOMY

The masks are coming off. In most places. If you’re vaccinated. But it may be tricky for businesses—especially customer-facing businesses: “Fully vaccinated people don’t need to wear a mask or physically distance during outdoor or indoor activities, large or small, federal health officials said, the broadest easing of pandemic recommendations so far. The fully vaccinated should continue to wear a mask while traveling by plane, bus or train, and the guidance doesn’t apply to certain places such as hospitals, nursing homes and prisons, the U.S. Centers for Disease Control and Prevention said Thursday.”

  • “In Mississippi, which has 25 percent of its residents fully vaccinated, the lowest rate in the country, health officials were quick to warn people to continue to wear masks, despite the guidance.”

  • “Some businesses might not adopt the recommendations quickly, as a large number of people aren’t fully vaccinated, local mask mandates might vary and companies want to protect their workers.”

  • “Kroger Co., the nation’s biggest supermarket chain, said it would continue to require people to wear masks and encourage social distancing.” READ MORE

HUMAN RESOURCES

You think it’s been hard to find job candidates so far? “Amazon.com said Thursday that it is hiring 75,000 people in the U.S. and Canada for work in its logistics and fulfillment network. The ecommerce and cloud giant said new hires will be paid an average of more than $17 an hour, and will receive sign-on bonuses of up to $1,000. The new hires will also receive an additional $100 if they show proof of COVID-19 vaccination. Amazon said its locations with the most job openings include Arizona, California, Colorado, Georgia, Illinois, Kentucky, Maryland, Minnesota, New Jersey, Pennsylvania, Tennessee, Washington and Wisconsin.” READ MORE

Is Amazon killing restaurants? “One Miami chef, Phil Bryant, told The Washington Post that Amazon's higher pay has forced many restaurant workers to reconsider their career paths. He said many of his former coworkers are asking themselves, ‘If I can make $17 per hour at an Amazon warehouse, but only $14 per hour as a line cook, a notoriously hot, stressful, intense job, why would I do that?’ Workers are also questioning the future of the restaurant industry. Bryant said workers are asking, ‘If this whole industry can deteriorate overnight and leave everyone unemployed, is this really stable enough to go back to?’”

  • “Customer-facing jobs have become increasingly dangerous for frontline workers during the pandemic. Workers have been forced to impose mask mandates to disgruntled customers and faced significant backlash.” READ MORE

GOVERNMENT SUPPORT

The Restaurant Revitalization Fund is now open only to businesses with $50,000 or less in losses: “The Small Business Administration, the agency overseeing the $28.6 billion grant program for hard-hit foodservice businesses, reported on Wednesday that since RRF's May 3 launch, it received more than 266,000 applications, representing more than $65 billion in requested funds. Nearly half, or 147,000 applications, came directly from women, veterans, and socially and economically disadvantaged business owners, who requested $29 billion in relief funds. That will leave hundreds of thousands of other restaurant owners out of the money.”

  • “For its first 21 days of operation, the RRF program was open only to businesses owned and controlled by women, veterans, and socially and economically disadvantaged individuals.”

  • “To date, $2.7 billion of relief funds have been dished out to 21,000 restaurants. The SBA estimates that RRF awards take approximately 14 days to be reviewed and validated.” READ MORE

MANAGEMENT

Carey Smith, who founded Big Ass Fans and sold it for half a billion dollars, asks what was remotely wrong with the Jason Fried memo that resulted in a third of Basecamp’s employees resigning: “As someone who at one time employed more than a thousand people, I can tell you, I only want that part of an employee’s whole self that is willing to put in a good day’s work. At the fan company, we offered all kinds of benefits to keep people happy and motivated, but we insisted that they focus on work during working hours. Every day we came together to design, build, manufacture and sell fans. That was our purpose as a company, and we took it seriously. But we also kept a beer fridge well stocked, and at the end of a good sales day, everyone could have a cold one and discuss whatever they wanted.”

  • “Fried may have been trying to reassure his customers with his apology, but in this case he has nothing to be sorry for.”

  • “He managed to get his problem employees out the door — those who’d rather discuss their feelings than discuss the work itself — without having to fire them, or confine them to the basement with their stapler, a la Office Space.” READ MORE

AUTOMOTIVE

Thanks to the chip shortage, many car dealers have no cars: “The market mismatch is driving up prices, and many buyers expecting to drive new cars off the lot have to wait weeks or months for their vehicles to arrive. Some showroom models sell for thousands of dollars over the sticker price. ‘We may just be in the greatest new-car market of our existence,’ Philadelphia-area car dealer David Kelleher said, ‘and we’re doing it with no cars.’ He recently woke up at 3:30 a.m. in a cold sweat and scrolled an iPad to check on his inventory of Jeeps and Ram trucks. After posting his best months ever in March and April, Mr. Kelleher was heading into the busy summer sales season with 98 vehicles on his lot instead of the usual 700.”

  • “Car makers are building some models without needed semiconductors and parking them until chips are available to install.”

  • “Tens of thousands of these vehicles sit at airport lots, a quarry, a racetrack and other makeshift holding pens near assembly plants in the South and Midwest.”

  • “Demand has pushed the average price for a new vehicle to $37,572 in April, up nearly 7 percent from a year earlier and a record for the month, according to research firm J.D. Power.” READ MORE

Try Morning Report Audio

THE 21 HATS PODCAST

Episode 61: I Think People Are Ready to Get Back to Work: Is your office open? Is everyone coming back? Or are you going hybrid? Is everyone getting vaccinated? Are you offering them incentives to get vaccinated? Are you having a problem filling jobs? Have you had to increase what you pay? Paul Downs tells us, “The people who really seem to want the job and are enthusiastic about it don't have the skill-set. And the people with the skill-set don't seem to actually care about completing the process. So we did hire one guy who started a week ago Monday, and he quit three hours later.”

If you see a story that business owners should know about, hit reply and send me the link. If you got something out of this email, you can click the heart symbol, you can click the comment icon below, and you can share it with a friend. Thanks for reading, everyone. — Loren