Cleveland Marketing Services

Advisor Insights

For the past several months, our Real Estate and Construction Group has been authoring a monthly column in Builders Exchange Magazine that offers advice to real estate and construction professionals.

So far this year, the following topics have been covered:

• The Benefits of Subprime Bonding  
• Selecting and Implementing Financial Software  
• The Value of a Niche Marketing Plan 
• Lessons Learned From the Construction Industry  
• Cancellation of Debt Income 
• Preventing Financial Fraud 
   

• Health insurers and group health plan sponsors are now prohibited from imposing pre-existing condition limitations on individuals who have not yet attained age 19 and from denying coverage to such individuals based on the existence of a preexisting condition. All such limitations and coverage denials, regardless of age, begin in 2014.
• Health insurers and group health plan sponsors are prohibited from imposing lifetime dollar limits on essential health benefits, and are required to sharply increase annual dollar limits on essential health benefits. Such annual limits will be eliminated starting in 2014.
• Coverage rescissions (except in the case of fraud or intentional misrepresentation) are prohibited.
• Plan-covered and insured individuals are given greater control over choosing a primary care physician and greater access to emergency services and related care.

To read more about these new rules, see this Executive alert from Baker Hostetler.

Go Directly From a 401(k) to a Roth  

Do you want to transfer your 401(k) plan assets to a Roth IRA? Under a recent tax law change, you can make the move in one fell swoop. Previously, it took two separate steps. In addition, another tax law provision taking effect this year may encourage this direct approach.

Click here to read more.

Should You Give to a Donor-advised Fund?

Wealthy entrepreneurs with charitable intentions may choose to set up a private foundation. But a more convenient alternative is gaining in popularity: the donor-advised fund.

This technique may be especially appropriate if you need to devote more time to business activities in the current economic environment. The fund does most of the hard work for you and requires less personal attention than a private foundation. In some cases, you might even convert an existing private foundation into a donor-advised fund.

Click here to read more.

New Law Revamps Student Loan Program

The new Health Care and Education Reconciliation Act of 2010—recently signed in conjunction with the monumental new health care law—includes dramatic reforms in the federal student loan program. This new legislation could affect families of all stripes for years to come.

Click here for a brief summary of four points you should know about.

Aurum Capital Markets Summary 

Please click here for a summary from Aurum Wealth Management Group on the performance of the major market indices through the end of May as well as a recap of the significant events influencing the markets.

Accounting and Tax Ramifications of Issuing Stock Options

 Click here to view Part 1 of our series and learn more about the stock option landscape.

To give you more perspective, first let us review the accounting treatment for the issuance of stock options (rest easy - this will not be too painful). When stock options are issued, an expense must be recorded based on the value of the option. A stock option’s value is derived from a variety of factors, two of which are the value of the stock as of the date of the option grant and the exercise price of the option (the price at which the option holder can purchase a share of stock). Determining the value of a company’s stock is not difficult when it is publicly traded, but privately-held companies do not have readily available market prices, which necessitates the services of a valuation expert. Unless the option is properly valued, a company cannot correctly record the associated compensation expense. If a company is unable to correctly record the results of its operations, it may find obtaining a clean audit opinion to be a difficult, if not impossible, task.

Now that I have warned you about the headaches that you may encounter on the “accounting” side of issuing stock options, let me further alarm you with the tax ramifications. If a company sets the stock option exercise price lower than the fair market value of its stock on the grant date, the stock option could be deemed to be deferred compensation according to Internal Revenue Code 409A. Under 409A, such deferred compensation would be immediately taxable to the employees receiving the grant and subject to regular income tax rates plus 1%. Perhaps even more distressing, a 20% penalty plus interest would also be triggered. In addition, employers would be responsible for withholding income taxes for employees on these types of option grants, which if not done, could result in additional tax penalties. The immediate taxability, penalty and withholding requirements do not apply when the stock option exercise price is equal to or greater than the fair market value of the company’s stock on the grant date. It is impossible to compare the exercise price of a stock option to the fair market value of a company’s stock unless a valuation of the company’s stock has been performed. In addition, when a valuation has been performed to establish the fair market value of a company’s stock, the burden of proof shifts to the IRS to disprove the appraised value. Therefore, unless there is documentation to support the fair market value of a company’s stock near the option grant date, there could be significant tax issues in addition to the accounting issues alluded to earlier.

The information in this article is not meant to represent legal or tax advice. Please consult with a Skoda Minotti business valuation professional or your tax/legal advisor regarding the applicability of these issues to your particular situation.

Visit us tomorrow for Part 3: What to Do?

In the meantime, visit our web site for more information on our business valuation services. Skoda Minotti is a CPA, business and financial advisory firm with offices in Cleveland and Akron.
 

2010 Real Estate and Construction Survey

Skoda Minotti is conducting our 3rd annual survey of the Northeast Ohio real estate and construction industries. Every participant who completes the questionnaire will receive a free copy of the survey results and analysis and have a chance to win a $50 gift card to Dick's Sporting Goods.

The goal of the survey is to provide professionals in the real estate and construction industries in Northeast Ohio with the invaluable insight into their industries.

As an added bonus, one out of every 20 survey participants will be randomly selected to receive a $50 gift card to Dick's Sporting Goods. Note that only the first 100 survey participants will be eligible for the gift cards, so act quickly.

Click here to complete the real estate or the construction survey.

Please feel free to contact Bob Goricki at bgoricki@skodaminotti.com or 440-449-6800 with any questions related to the survey.

Green Building & Green Leasing: What is it, and why should I care?

By Peter D. Brosse, Esq., Meyers, Roman, Friedberg & Lewis

Since the establishment of Earth Day, the creation of the Environmental Protection Agency (EPA), and issues brought to public light by the Oil Embargo in the early 1970's, Americans have become more sensitive to the environment and use of resources, including petroleum. However, we still continue to use many of the same chemicals, gasoline and other resources as we did before, subject, however, to regulation.  Recently, a revolution has begun with new attention to conserving energy and resources. This new "green revolution" is evident with the use of a new vernacular that has entered into our common language. Only a few years ago, such words as "green","sustainable," "renewable energy," "greenwashing," "LEED" and "Energy Star" were rarely, if ever, used.  Today, these are part of everyday speech. Nowhere has this "green revolution" been more evident than in the real estate industry.  Such words as "building green" and "green leasing" are commonly heard and many articles are written about the subject. When discussing green building and green leasing, the question that owners, developers and tenants typically ask is "What is it, and why should I care?"

Is there a difference between "green" and "sustainable?"

Yes, there is a significant difference.  When one considers green building or green leasing, it is really sustainability and not "green" that is the focus. "Green" generally means to be environmentally friendly. To be "sustainable" means more. When one refers to sustainability, it takes into consideration the life cycle of a product or a building. To say a product is sustainable, one needs to look at processes, procedures, materials, how the product is manufactured, and whether the product can be reused or ultimately finds its way to the landfill.

Click here for more of this article.

Residential Real Estate: Making Modifications Work
By Brian Bader

Lew Ranieri, often credited with creating the mortgage-backed securities industry when he was at Salomon Brothers in the early 1980s, has returned to try to save America from the worst effects of that accomplishment. In 2008, Ranieri established the Selene Residential Mortgage Opportunity Fund, raising money primarily from foundations and pension funds, to buy and restructure failed mortgages created to feed the securitization process. In doing so, he is showing how mortgage modifications can work - and why the federal home-owners modification program (HAMP) has done so poorly by comparison.

Click here for more of this article.

CMBS: Special Servicers
By John Tax

Special servicers are the firms trying to correct mortgage loans in the later stages of delinquency or in actual default. Their role has become increasingly important as a result of the tremendous number of troubled loans According to a report by Standard & Poor's (S&P), servicers have been training their staffs to address the unique aspects of these loans, packaged as commercial mortgage-backed securities (CMBS). Almost 50 percent of these unresolved assets are loans originated in 2006 and 2007. Many of the loans are more complex than older ones, which mean it takes longer to resolve them, either by a full workout, a discounted payoff or foreclosure sale. Because of the time period in which they originated, many of the newer loans lack some of the safeguards present in the commercial loans originated before 2004.

Click here for more of this article.

Securitization: Covered Bonds
By Anthony La Malfa

The use of covered bonds as a source of home-mortgage funds is being encouraged by the U.S. Treasury Department and the Federal Deposit Insurance Corporation (FDIC) because they offer much greater certainty for the bondholders with respect to damages and rights.

Covered bonds contain a key element that is missing in many commercial mortgage backed securities (CMBS), i.e., a double layer of protection for investors, with the asset being backstopped by the issuer of the securities. The key difference between CMBS and covered bonds is that the latter requires lenders to retain the default risk. On the other hand, covered bonds fail to provide a good option for private labels because they require a capital base to retain loans on balance sheets and do not provide the higher level of leverage that was available with CMBS.

Click here for more of this article.

Leases: Subordination Clause Could Harm Tenants
By David Tevlin

Commercial lease agreements often are long and complex, with clauses neither party may expect will ever be triggered by events. But sometimes they are. One such is the lease subordination clause, by which the tenant agrees the lease is subordinate to any present or future mortgage that the landlord may put on the property. Accordingly, foreclosure of a mortgage (depending on the law of the state involved) either will automatically terminate the lease or entitle the lender, at its option, to terminate the lease.

Click here for more of this article.

Legal View: Second Circuit Rejects Champerty Defense
By Alvin Arnold

Champerty is not a word often heard these days, even though it is a living doctrine in modern law and on occasion has real bite. In a recent case, the Second Circuit Court of Appeals reversed a trial court ruling that had dismissed a mortgage trust's suit for indemnification for loan losses from the originator. Trust for Certificate Holders of Merrill Lynch Mortgage Investors v. Love Funding Corp., 391 F.3d 116 (C.A.2, N.Y.). However, the reasoning of the decision leaves some room for the distressed debt markets to be concerned.

Click here for more of this article.

Migration: Major Shifts
By Andrew Dalecki

Every type of real estate - housing, business, retail, and office - is impacted by population movements across the U.S. and across its borders. In its most recent report, based on new Census numbers, the Brookings Institution says the past ten years saw the greatest migration slowdown since the end of World War II. Significant events were the housing bubble and the worst recession in more than half a century, as well as major storms and terrorist attacks.

Click here for more of this article.

Cleveland Market Overview

Signs are pointed towards recovery for commercial real estate in Cleveland.  The vacancy rate was down over the previous quarter, with net absorption totaling positive 293,238 square feet in the first quarter.  In fact, with the exception of the Southwest and Downtown's Financial and Warehouse submarkets; all markets posted a positive overall net absorption for the first quarter of 2010.  The Cleveland office market ended 1st Quarter with a slight decrease in the overall vacancy rate, 21.8%, as sublease space outperformed direct deals.  Another good sign; rental rates are stabilizing, ending the first quarter at $17.90 per square foot. 

Nationally, as job losses abate and turn into employment gains across various industries and geographies, more markets are moving towards recovery.  This includes Cleveland because we lacked the high stock of inventory that plagued more developed markets (Las Vegas, Phoenix, Florida).  Cleveland should be in a good position to rebound quicker than other markets and continue to see an increase in activity and deal flow.

More information on the real estate markets in North America is available courtesy of Jones Lang LaSalle .  For questions on this information, please contact Andrew Coleman or J.R. Fairman at (216) 861-7171.

Whether it is through acquisition or organic growth, more and more of today’s companies have the ability to offer numerous services and/or products to multiple target audiences across vastly different industries.

However, according to Jonathan Ebenstein, the managing director of Skoda Minotti’s marketing services group, all too often companies are using a shotgun approach to marketing, when a rifle-based solution is needed.

“In other words, you can’t use the same broad-based, one-size-fits-all marketing approach to go after a construction company as you would for a law firm,” says Ebenstein. “These are two different industries with vastly different needs, hot buttons and challenges.”

Click here to read more of this article from SmartBusiness Cleveland.

And, for more information, post a comment below or contact our Marketing Services Group at 440-449-6800.

Advisor Insights

This month, our monthly Advisor Insights column in Smart Business Cleveland Magazine takes a look at lessons learned from the restaurant industry.

The restaurant industry is still feeling the sting of the recession, and the general consensus is that consumers are very pessimistic about 2010.Therefore, restaurants have had to adapt to survive as their longtime patrons trim their dining-out budgets.

What can other industries learn from the restaurant industries struggles? Click here to read the full article, "Lessons Learned from the Restaurant Industry."

HIRE Act Provides Employers with Tax Incentives to Hire Unemployed Workers

The Hiring Incentives to Restore Employment, or HIRE, Act, was recently signed by President Obama after being approved by the Senate by a 68-29 bipartisan vote on Wednesday, March 17th. It is the first of a series of bills that the administration and Congress plan to introduce to reduce the unemployment rate.

Some key points are listed in our blog post here.
 
FRx Discontinued; Paves Way for Microsoft's New Business Intelligence Program

Microsoft currently offers three Corporate Performance Management (CPM) programs: FRx, Forecaster and Enterprise Reporting, which aid businesses in the areas of financial reporting, planning/budgeting/forecasting, and consolidation. Starting in May 2010, the capabilities of these CPM programs will gradually be combined into one program, Microsoft Dynamics Management Reporter, as part of an integration process that will take place over the next four years.

Click here to read more.

Skoda Minotti College Planning Seminars

In the coming months, we will be hosting free college planning seminars (great for current high school freshman, sophomores or juniors) on a monthly basis. We invite you to join us at one of the events listed below. All events will be hosted at our offices. Click the link to register. 

• April 27
• May 25
• June 29
• July 27 

• Analyze your ability to qualify for college funding and to what extent by computing your expected family contribution.
• Develop "college aid planning" concepts that may lower your out-of-pocket costs by increasing your eligibility for funding.
• Assume responsibility for the completion of the complicated FAFSA form annually. And at no additional cost, complete such other forms as may be required by individual colleges.

Click here for more information on Skoda Minotti College Planning Services.

Working at a Downsized Company

OK. You did it!  After listening to the advice of your experts and looking at the balance in the checkbook, you downsized 25% of your personnel and cut management salaries by 10%. It wasn’t easy and, in fact, it was a terrible experience. You order a complete review of job descriptions and issue a hiring freeze. But how do you keep the employees operating at optimum efficiency with only 75% of the workforce?

Click here to read more.

Combining a Business Trip with a Vacation

With the warmer weather approaching, you may be looking to spend some time at the beach, on the golf course or just relaxing by the pool. If you can add a few days of vacation onto a business trip, so much the better. Besides saving money, you may qualify for some generous tax breaks.

Click here to read more.

New Case Allows Deduction for Business Education

No matter how old you are, you can still learn to do your job better. For example, you might take a refresher course to stay on top of the latest developments in your field. Or you may enroll in a curriculum that will start you toward a new career.

Click here to read more.

Six Estate-planning Steps for This Year

The scheduled one-year repeal of the federal estate tax in 2010, plus the related changes in the federal estate- and gift-tax system, have certainly clouded estate-planning matters this year. It is expected that Congress will eventually take some legislative action, but that does not mean you should stand by idly. It is important to have your estate plan reviewed to ensure it still meets your objectives and that it is positioned to accommodate future developments.

Here are six steps you may take to shore up your estate plan under the current conditions.

Aurum Capital Markets Summary

Please click here for a summary from Aurum Wealth Management Group on the performance of the major market indices through the end of February as well as a recap of the significant events influencing the markets.

Skoda Minotti Blood Drive

We are pleased to announce that we will once again be supporting the American Red Cross by hosting a blood drive for our employees on April 26th at our Mayfield Village office.

Last year, our employees donated 69 pints of blood through these blood drives and we are aiming to top that number in 2010.

If you have any questions about any of these articles, post a comment below or contact us at 440-449-6800.  Or, if you would like to subscribe to this free, monthly e-newsletter, please send an email to information@skodaminotti.com.

As a kid, baseball and football trading cards were my life. I would absorb the stats on the back of each card and rattle them off at school like it was a homework assignment. I have boxes and boxes of cards that I accumulated over the years, as I am sure that may of you do (if your mom hasn’t tried to throw them away yet). What do baseball cards have to do with the value of your business? More than you think.

Magazines such as Tuff Stuff and Beckett quote estimated prices for nearly every sports trading card available. These prices are representative of what we in the valuation world would call “fair market value”. This is the price at which a willing buyer and a willing seller, with all material facts about the card known to them, would likely transact. A majority of business valuation engagements, including those for IRS gift and estate tax reporting purposes, divorce proceedings, and as directed by many operating agreements, require fair market value to be used as the standard of value. Fair market value typically contemplates that the purchaser is a “financial” buyer (someone who is making an investment in the business with no means to create synergies or other economies of scale), unless certain circumstances dictate otherwise.

When many business owners contemplate the value of their business, however, they often think of a larger company similar to their own paying a premium for their business. The assumption made by the business owner is that the purchaser will be able to recognize certain post-transaction efficiencies, which will allow the acquirer to pay more for the business than a “financial” buyer. This is called “strategic value” or “investment value” (the value to a specific buyer), which is not the standard of value required to be adhered to in many business valuation engagements.

For example, I have a 1994 Kenny Lofton Upper Deck card that has a quoted value of $.10 according to Beckett. Someone who has the entire 1994 Upper Deck set except for the Kenny Lofton card that I own may be willing to pay a premium above the card’s $.10 “fair market value” because that owner can derive additional value by completing their set. This premium price is the “strategic value” or “investment value” to that specific owner, but is not reflective of the card’s “fair market value” in the general marketplace. 

While a business’ underlying assets are the drivers its value, the perspective from which that value is determined can have a significant impact on the final number. When business owners are in need of valuation services, it is important that all of the parties understand what standard of value is being used, whether it is “fair market value” or something different, so that the value of the business is considered in the correct context. 

Looking for business valuation assistance in Cleveland or Akron? Contact our Business Valuation Group at 440-449-6800 for more information.

As of today, over 913,000 people have demanded that Paramount Pictures and DreamWorks Pictures show “Paranormal Activity” at theaters nationwide.  The film that’s being dubbed the next “Blair Witch Project” originally opened in select theaters with promoters telling us to go online and request that the film be released nationwide or, at a minimum, be shown at a theater near us (Quick sidebar for scary movie lovers in Cleveland, this film is now showing in our area).

What does this tell us? Aside from the fact that our country loves scary movies? It tells us just how powerful social media is.  Although the movie was just released two weeks ago, it has already amassed quite a following:

• Facebook: The film’s fan page has 48,684 fans (& counting). These are active fans, too – thousands have liked items and posted comments and 27 have even uploaded videos 
• Twitter: @TweetYourScream has nearly 4,800 followers and “Paranormal Activity” is currently one of the top Trending Topics
• YouTube: Over 300 videos about paranormal activity have been uploaded in the past week alone 

While your company’s presence on social media sites may not result in this exact same type of nationwide buzz, the effect of engaged consumers (or wannabe consumers in this case) is clear.  

Have questions about incorporating social media into your strategic marketing plan? Contact our Marketing Services Group at 440-449-6800.

The question is now not when or if the housing market will recover, because this nation still has net annual household growth of approximately 1.5 Million each year, but what form will this recovery take?

The household growth stimulating demand, coupled with the tightening of new construction supply will eventually lead to a backlog of demand. Once price adjusts, and demand is back ahead of supply, houses will need to be built. A key piece to this swing towards increased demand is the uncertainty associated to what types of homes will be constructed. The transition in the mindset of consumers, inspired by the recession, has led to a new era of conservatism which will challenge the housing models that emerged in the past decades – the McMansions and sprawl of suburbia may have reached its end.

The consumer is transitioning away from this excessively consumptive attitude and is looking for housing that will be sustainable, both financially and in a macroeconomic sense. These new homes will need to fit the household’s budget while being good for America as it attempts to reestablish a sustainable infrastructure. These macro-conscious consumers will usher in a new and still uncertain breed of home, as well as a rethink where they choose to locate. Will these homes be multi-family duplexes and 6 suiters built in the 20’s and 30’s?  Or will they take the form of the mid-rise condos/apartments?  In whatever form the future takes, it is certain to be more dense with the return of increased energy and transportation costs. How will developers and city planners create this future?

Through neo-urbanism. This transitioning concept is becoming mainstream throughout the nation, but before its implementation in Cleveland, we have some serious obstacles to overcome. Neo-urbanism is forcing issues that plague our center city and keep people from moving back into Cleveland – issues like education, crime, blight, and civic services disparities. These issues need to be resolved before this new wave of redevelopment takes place. The Cuyahoga County Land Reutilization Corporation (CCLRC) may prove to be key in this transition. While the CCLRC is limited in that it will do little to change crime statistics or school performance, which are critical factors when choosing where to live, it will grease the wheels on creating and re-purposing land befallen to blight.

The possibilities are endless as these households are forced into making the decision of where and how they want to live. Fortunately for now, these decisions are still a few years away as existing supplies are absorbed by already existing inventories, but that should not stop the planning for the developments of tomorrow today. A new era of thrift may be the United States’ first step towards recovery and stability. 

Our city needs to prepare itself for this transition, ramping up efforts to eliminate neighborhood crime, seeking alternatives to currently failing public school systems and making sure the public services will be available to the re-developing pockets in Cleveland.

For more information, please contact our Real Estate and Construction Group at 440-449-6800.
 

Sports Sponsorships – Inside the Lines

With the economic downturn hitting the sports world just as hard as any other business – just ask the hometown Cleveland Indians – teams are looking to squeeze out any extra bit of possible revenue.

Walk into any professional sports stadium today and you’ll immediately be bombarded by advertising in a variety of different formats. In fact, it might seem that you see ads everywhere except for on the field. That is, unless you attend certain NFL training camps this summer.

The NFL now allows teams to sell sponsored space on their practice jerseys and many teams are taking advantage. Could game day jerseys be the next item up for bid?

While the idea of our major professional sports teams wearing sponsored jerseys may seem strange to American sports fans, European sports have been embracing this concept for quite some time and for great financial gain. Last season, jersey sponsorships across Europe’s top six soccer leagues accounted for 393.2 million euros ($561 million).

These types of revenue figures could sound more and more appealing to our major sports leagues in the near future. What are your thoughts on jersey sponsorship? Let us know with a comment below.

Looking for “out-of-the-box” thinking from your marketing efforts? Contact Skoda Minotti Marketing Services at 440-449-6800 for more information.

Topics: Akron Marketing Services, Cleveland Marketing Services

Shortly after being drafted, Lebron James signed a seven-year, $90 million endorsement deal with Nike. In 2006, Tiger Woods earned $20 million from Nike for promoting their golf division and that deal was just one small portion of their $1.7 billion advertising budget – that year, they spent $476 million on endorsements.  And, in 2009, Catherine Zeta-Jones will earn $20 million for encouraging us to undergo a mobile makeover with T-Mobile. 

Considering society’s fascination with celebrities, this doesn’t seem strange.  After all, when Michael Jackson passed away, Twitter, and even Google, temporarily crashed. People can’t get enough of their favorite celebrities. But do we care enough about them to buy what they tell us to?  According to a recent study, not really.
 
Only 8% of respondents said seeing a celebrity in an ad made them more likely to buy; conversely, 12% said seeing a celebrity made them less likely to buy.  Women and people in management positions are slightly more willing to make a purchase based on a celebrity endorsement, with only 11% saying a celebrity is a deterrent. The majority of other demographic groups, however, are less receptive to celebrity endorsements with respondents over 55 being least receptive with 24% saying that seeing a celebrity in an ad makes them less likely to buy.

So, don’t have the money to pay Lebron James to endorse your product? Fortunately, an endorsement from James down the street might be just as influential.

Have questions about your advertising strategy? Contact Skoda Minotti Marketing Services at 440-449-6800.

Topics covered: Cleveland Advertising Firms, Cleveland Marketing Consultant, Akron Marketing Services

Next time you’re out shopping, take notice of the amount of products claiming to be “environmentally friendly.” Do you believe these claims?

TerraChoice, an eco-consulting firm, took a closer look at the claims of almost 4,000 products claiming to be “natural and environmentally friendly.” The results were surprising – almost all of the claims were found to be “false or misleading.” Greenwashing, as it is known, means that consumers may find it harder than ever to know what claims to trust.

Wal-Mart, however, wants to change that. The retail giant announced earlier this month that it will require “all of its product suppliers to calculate the environmental costs of their products.” Wal-Mart will then calculate a “green rating” for the product and display it near the price tag. Suppliers that fail to comply will be banned from Wal-Mart shelves. The process is expected to take four years.

This is a major sign that companies will not longer be able to market their products as “green” without actually backing up the claim. In other words, it won’t be so easy being green.

Looking for a Cleveland Marketing Consultant? Contact Skoda Minotti at 440-449-6800.

"Pay-Per-Click," or PPC,” is a method of online advertising that's measurable, flexible and very fast. PPC ads are paid listings that appear above and to the right of the free listings on Google, Yahoo, and other search engines. To be listed in a search engine’s PPC’s results you pay/bid in an auction like manner. With PPC you only pay for the ads that are clicked on, so in addition to being able to quickly, measure the effectiveness of your ad, you can also track and justify your results and costs.
 

For example, in the illustration above, someone in need of financial services, presumably in the Cleveland area, searched on Google for “Cleveland financial planning services”. This screen shot shows the first four choices and links that are available from about 614,000 results. In looking at the PPC results on the right, the folks that own www.USdirectory.com, have the highest PPC position, probably paid the most to be there, and by virtue of top positioning are probably most likely to get clicked by the searcher. If someone does click on the ad, US Directory.com, will then pay what ever their cost per click bid was. If the searcher elected to click on the second sponsored link, “Cleveland Financial”, Skoda Minotti, (it’s our ad and we are not ashamed to pimp it) would pay.

The important difference to remember when looking at PPC vs. other kinds of paid advertising is that you don't pay until someone clicks. So while in a TV or radio campaign, you pay for all the eyes and ears (i.e., impressions) that could potentially see and/or hear your message. With PPC, you only pay for those that are actually interested in your company. The impressions, while still valuable from an awareness standpoint will cost you nothing.

Looking for a Cleveland Marketing Consultant? Contact Skoda Minotti Marketing Services at 440-449-6800.

Topics: Akron Marketing Services, Cleveland Marketing Consultant, Cleveland Marketing Services

Despite a difficult economy, you may want to think twice about cutting events from your marketing budget. Events are great way to not only attract prospective customers to your product or service, but they also present a chance for you to stay top of mind and potentially drum up business from your existing customers. 

Here are a few tips to lower your event budget:

Partner up to bring costs down: Rather than hosting an event solo, consider adding a partner to the event to help cover costs. In addition to splitting the costs with your partner company, you’ll also increase the size of your invite list and bring more fresh faces into the room for networking purposes.

Breakfast…It’s the most important meal of the day: Planning on feeding your attendees? You can reduce your food budget by a significant amount by holding your event at breakfast instead of lunch or dinner. Additionally, you should improve your attendance rate due to the fact that attendees are likely heading to your event first thing in the morning before they get caught up in other tasks at the office.

When in doubt…Webinar: Webinars are great for several reasons. First, they keep your costs to a minimum by eliminating the venue costs and the catering fees. Second, they are reusable. You can easily post a webinar to your company’s web site and visitors can download the audio or video file at any time. Finally, since attendees can watch your webinar from anywhere, this event can literally spread your message to laptops across the country.

As always, to maximize the value of any event, don’t forget to follow up after the event while it’s still fresh in people’s minds.

Looking for a Cleveland Marketing consultant? Contact Skoda Minotti Marketing Services at 440-449-6800.

A business valuation is a just a business valuation – isn’t it? This would be akin to saying that a steak is just a steak when, in fact, there are ribeyes, strips, sirloins, and filets (just to name a few). Likewise, business valuations come in two distinct “flavors” – conclusions of value and calculations of value.

As of January 1, 2008, valuation analysts who hold either the Certified Valuation Analyst (CVA) credential supported by the National Association of Certified Valuation Analysts or the Accredited in Business Valuation (ABV) credential supported by the American Institute of Certified Public Accountants have been required to follow new standards that clearly delineate between two types of valuation engagements. Similar to the differing levels of service traditionally offered by accounting firms in performing audits, reviews, or compilations, business valuation engagements are now separated into two defined service categories:

Conclusion of Value

-          All three valuation methods (asset-based, income-based, and market-based) are required to be considered

-          Detailed development and reporting requirements must be adhered to by the valuation analyst, making the engagement more time consuming than a calculation of value

-          This is the required type of report for estate and gift tax filings; Also typically required for instances in which the valuation analyst will need to defend his or her findings and report (i.e. in litigation)

-          The valuation analyst opines on the value of the business or business ownership interest

Calculation of Value

-          The valuation methods to be used in determining value are discussed and agreed upon beforehand between the client and the valuation analyst

-          Reduced development and reporting requirements compared to conclusion of value engagement

-          Ideal for planning purposes (e.g. strategic planning, transaction (purchase or sale) planning, or litigation or divorce proceedings in the settlement stage)

-          Valuation analyst does not opine of the value of the business or business interest, rather, the valuation analyst applies the valuation methodologies agreed upon with the client

-          Generally not defensible in litigation settings because the valuation analyst is not offering an opinion of value, rather, the analyst “calculates” a value based on methods agreed upon with the client

-          Typically costs less than a conclusion of value

-          Has been found to be useful in divorce situations in which a spouse will obtain a calculation of value to aid in the settlement process; If a settlement is not reached, the engagement can then escalate to a conclusion of value so that the valuation analyst can opine on a value and defend it in court, if needed

As you can tell from the discussion above, all “valuation” work is not created equal. For business owners, as well as their attorneys and other advisors, it is important to be aware of the varying levels of valuation service offered so that the appropriate type of report is obtained. You should discuss the purpose of the valuation with the valuation expert in detail as the engagement is forming so that the level of service can be tailored to your specific needs. 

The last thing that you want to do when having a valuation performed is pay too much to obtain a conclusion of value that will only be used for planning purposes or pay too little to obtain calculation of value that will not hold up in litigation or under IRS scrutiny.

Looking for business valuation assistance in Cleveland or Akron? Contact our Business Valuation Group at 440-449-6800 for more information.

Topics: Cleveland Business Valuation, Akron Business Valuation

Ever wondered why car manufacturers abandoned the descriptive car names of the good ole’ days such as Rabbit, Monte Carlo or Imperial in favor of the seemingly random assortment of letters and numbers such as the DTS, CLK or the G6-GXP?

According to this article, the trend originally began with luxury car manufacturers in the 1970s that found it easier and less expensive to advertise and build the name of one brand with various model numbers rather than multiple model names.

This naming strategy may be starting to rub consumers the wrong way, however. One example cited in the article is that owners of BMW’s 3-Series feel that they are looked at as a lower class than owners of the 5- or 7-Series.

This is a lesson to keep in mind when you are expanding or adding a new product line. A name says a lot about your product and can influence how consumers view your company and your brand.

The best way to be sure your name will positively enhance your brand is to do your research. Internal and external testing as well as focus groups and surveys can help to ensure that you are on the right track with your name.

Looking for help improving your brand image? Contact Skoda Minotti Marketing Services at 440-449-6800.

Topics: Akron Marketing Services, Cleveland Marketing Consultant, Cleveland Marketing Services.

“Corporate Vigilance in Desperate Times” was the title of a presentation I made to a group of corporate controllers on behalf of the Ohio Society of Certified Public Accountants.

It’s hard not to pick up a newspaper these days and see dismal economic results. The next article discusses employee layoffs. “Happy Days Are Here Again” will not be heard on your car radio on the way home. And once home, chances are that you don’t want to look at your stock portfolio or 401k statement that came in the mail. 

Many employees are scared. Financial pressures are fierce. A spouse may have been laid off thus crippling the family cash flow. Retirement, carefully planned for years, may now have to be delayed since the market has halved your nest egg. With foreclosures at record numbers not seen since the Great Depression, many must evaluate whether they can provide a house for one’s family?

In troubling times such as this severe economic downturn, the opportunity is ripe for fraudsters to shake cash from unsuspecting companies. Companies must be more vigilant than ever to protect their financial resources.

Unfortunately, we have become aware of some companies cutting jobs within accounting departments and as a result potentially compromising their internal controls – controls vital to not only good financial reporting, but safeguards in general to the overall corporate assets.

Is there a correlation between a downturn in the economy and an increase in fraudulent acts such as embezzlement? Sure there is. In larger corporations there is intense pressure to “make the numbers” thus resulting in tempting financial statement crimes.

Eliminating staff in an accounting department will usually reduce the effectiveness of established internal controls.   Less effective internal controls is an invitation for embezzlement. And don’t think that the thieving opportunist doesn’t recognize the void suddenly created. 

If you’re like just about every other business professional these days, sales are down, new business efforts are up and it’s time for you to get out…and start networking.  I know what you’re thinking.  I hate networking.  I’m painfully uncomfortable talking to a bunch of people I don’t know.  I don’t know what events to attend …etc.  I get it.  For most of us networking is as unnatural as a palm tree on the shores of Lake Erie, but the reality of the times is this:  You have to start doing something to drive sales and networking, when done right, works.

Networking that builds business is not just circulating through a room exchanging business cards. Networking done right is creating a pool of contacts from which you can draw clients, referrals, resources, ideas, and information. To be successful, your business network can and should contain colleagues, competitors, a wide range of business people, and personal friends, as well as clients and prospects.

Meeting people at organized events is one of the easiest ways to build an extensive business network. The first key to effective networking is choosing the right kind of events to attend.  In Northeast Ohio, regardless of what industry you are in, there is no shortage of events to choose from.  A good source for learning what events are happening and when, are the event boards of the following web sites: Smart Business Magazine, Cleveland.com, Crain’s Cleveland Business, Cleveland Business Connects and/or Inside Business.  Clearly, there’s a lot to choose from, so when considering an event, try to make sure that the people attending are largely potential clients, and other professionals who may be able to refer business to you.

It is important to understand that successful networking does not always yield immediate results.  Think of it as planting seeds.  It may take some time before you efforts bear fruit.  Ultimately if you become known as a powerful resource for others, people will remember to turn to you with not only business referrals, but for suggestions, ideas, names of other people, etc. Networking keeps you visible to them.

Lastly, keep in mind, networking doesn’t end when the event is over.  Follow-up and ongoing contact is a key component to successful business development.  When you get back from an event, make sure you add any new clients to your contacts database and flag those contacts so that they can receive any future communications from your company (i.e., e-newsletters, e-blasts, holiday cards, etc.)  You should also consider forwarding these people relevant articles, events or web sites that you come across that you think may be of interest to them. 

The hardest part of networking is getting out the door and to the events. Set a goal for yourself to attend at least one networking function each month and before you know it, the faces in the crowd won’t seem quite so unfamiliar and you’ll be on your way to building your own business network.

Looking for a Cleveland or Akron marketing consultant to help you with your networking initiatives? Contact Skoda Minotti Marketing Services at 440-449-6800.

 

If you’re familiar with Facebook, you’ve no doubt heard at least one of your Facebook friends complain about the popular social networking site’s new look. (If you’re not familiar with Facebook, stop reading this article and join the 175 million users around the world – after you’ve done so, come back, finish the article and learn how the new Facebook can be beneficial to your business).

 

What may have been lost in the shuffle amongst the discussion over the look of the personal profiles is the redesigned “Page” feature. Many businesses as well as actors, musicians and other public personas use the Page feature to share news, photos, videos and other items of interest with their “fans” (Facebook users who have voluntarily joined the Page).

 

Taking advantage of a Page to help market your business can be a great (and free!) way to keep you top of mind with your fans.

 

For a business, the new Pages have several benefits.

 

·          Status updates – Status updates are the manner in which a company adds new content to its page. Having a sale? – update your status. Adding a product? – update your status. Post a new blog? – update your status. The key here is that more (relevant) updates that your company has, the more often you’ll appear in front of your fans via their status updates.

·          Redesigned Wall – The Wall is now the focus of the page – very similar to personal Facebook pages. Here, fans and non-fans can see what your business has been up to lately via your status updates. With the Wall being the focus of the page, it will become more important to update content frequently to keep your page from appearing stale. Additionally, your wall gives your fans a chance to interact with you by commenting on your latest status updates.

 

·          Tabs – The “tabbed” look that personal pages have taken on also applies to the new business pages. This allows for a more organized look and allows you more customization over what your fans see.

 

 

As the Page feature is free (for now), it can’t hurt to try it out. To learn more, check out Facebook’s overview of the new Page feature.

 

Looking for a Cleveland Marketing consultant? Contact Skoda Minotti Marketing Services at 440-449-6800.