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If you’re looking to get into video marketing, there’s no better channel than YouTube. They’re the second most visited website on the entire internet, with over 2 billion users, have virtually no competitors, and consumers are increasingly spending more time watching more online videos.
The good news is you don’t need to flood thousands of dollars in YouTube advertising. If you create a good channel that constantly puts out quality content that people want, you’ll get the attention and eyeballs you need to drive customer acquisition through YouTube.
Here’s how to do just that.
Part 1: Create a Great Channel Layout & Organize Your Youtube Content
This blog post won’t get into the weeds of how to upload a profile picture, cover image, or the steps to upload a video. YouTube already has those steps. It’s easy, and you don’t need any instructions from me.
I’m going to use this first part of the guide to talk about why you need a great channel layout.
The first step to YouTube marketing is to have a great channel layout. When people come to your channel, they need to know what you’re about and what types of videos you have.
Here’s how my channel looks:
My value proposition and color scheme are simple and match my website. The CTA says how often I publish new videos. My trailer is like an extension of the value prop.
People want to learn SEO and social media marketing from me. So, I’ve created a ton of videos on those topics and organized them into different sections:
This organization makes it easy for people to get an idea of what types of content I publish. If you have a lot of videos, I’d recommend you do the same.
Create Regular YouTube Video Content
Consistently updating your channel with content will keep your channel feed active, increase your presence on YouTube, and help you build an audience.
You should aim for a minimum of one video per week, but the right amount of content depends on your audience, your goals, and your content.
One simple way to create a steady stream of content is to produce shorter versions of long-form content. Build a theme around a topic and then post bite-size versions of the theme on a weekly basis. This will keep your audience engaged and coming back for more.
How to Write a Great YouTube Title
This is one area you cannot ignore. Titles are very important in YouTube. No matter how great your video content, it won’t matter if you can’t get anyone to actually click on your video in the first place.
There’s a few different tactics I see marketers and creators on YouTube using.
The first one is the sports gossip outlet TMZ Sports. They’re not marketers, but they know how to get attention, and that’s important for marketers. Let’s see if you can find a trend in their titles:
Business Insider follows a similar formula. Let’s see some examples from their YouTube channel:
What TMZ Sports and Business Insider essentially do is write half a sentence and leaves it as a “….”. This means that if you want to find who said what or what the kids should, you’ll have to click on the video to find out.
None of these titles are mistakes. They are intentionally written this way to get you to click.
Is it clickbaiting?
A little bit. But you shouldn’t completely avoid clickbait, because some of it works.
Here’s how to do it yourself.
YouTube’s title character limit is 100, but right around 50-55 characters is where they start to cut off the text on the desktop. This is where you write your cliffhanger. Look what TMZ Sports does when they write their titles.
If I had a video about my SEO hacks, I may write a title like this:
Search Engine Optimization | These four SEO hacks will skyrocket your traffic
The part in italics is what will show as the title on YouTube. You see that I leave a cliffhanger that will make people want to click. I also put in the keywords search engine optimization and SEO in there to make it clear what the video is about.
I’d then put the Google logo in the thumbnail to catch the eye and make sure people know it’s about Google SEO.
Keywords are the other important aspect of YouTube SEO. You need to make sure you put those keywords in your title so it attracts the right audience. Keywords like social media marketing, search engine optimization, conversion rate optimization, ROI, and blogging are all keywords you’ll find me using. If you know your niche, you’ll know what keywords you need to use.
Now that we have the title, let’s move onto the visual title – the thumbnail.
Design The Right YouTube Thumbnails
Don’t skip this part. Choosing your YouTube thumbnail is just as, if not more, important than crafting a great title.
Let’s first go through a couple of the goofy hacks marketers use on their thumbnails.
Use Arrows and Circles
Marketers are increasingly using red arrows and circles in their YouTube thumbnails and their social graph images. Here’s what I mean:
There is clearly no need for a red arrow here. So why do they add it? Because it draws eyeballs and clicks.
I’ve used this tactic as well.
You may want to give it a shot and see if it increases your views!
Include Your Logo to Boost Brand Awareness
Here’s another hack that marketers like to use: putting your logo on the thumbnail. That way, even if no one clicks your video, you’re still drawing awareness and spreading your brand.
CNN puts its logo on every thumbnail:
Look how big that logo is. Does it need to be that big? Of course not, but it spreads the CNN brand, even to people who won’t click and watch the video.
I do the same thing, but instead of a logo, I use my face and include my brand colors.
I don’t need to put my face on this thumbnail, but it helps my fans recognize me. And if people aren’t familiar with me, they’ll see the title of this video and wonder who the heck that guy is and may click and video and be introduced.
Just remember that viewers shouldn’t feel like they’ve been tricked into viewing your video. Your thumbnail needs to accurately represent the content of your video.
Cross-Promote with Other Channels
To increase your reach on YouTube, make it a priority to identify and reach out to other similar channels to cross-promote or collaborate in a mutually beneficial manner.
This doesn’t mean that you need a huge following on YouTube already. You can use your email list, social following, or even embed videos on your website to drive traffic.
We’ve covered how to get people to click on your videos and cross-promoting. Now let’s go on to another facet of marketing on YouTube, which covers optimizing your videos for YouTube search.
Here’s how to put your best foot forward to get near the top of YouTube’s search results (without having to pay for it):
Writing Great Descriptions
YouTube has a great section detailing how marketers and creators can write great descriptions. I’d recommend you take a look at that if you need a full guide.
The part that I want to emphasize is the importance of using keywords early in your description. Here are the keywords I put in one of my videos:
When you know what keywords you’re trying to rank well for, you can put those in the title and description. You can also mention those keywords in the video and put those in your closed captions.
Just never force anything and keyword stuff. It just makes you look spammy and untrustworthy.
Your descriptions should be at least one paragraph. YouTube gives you 5000 characters to write. Don’t be bashful. Use as much of it as you need to.
I use my description as a transcript. But I also put links to my blog and social above the fold. So even if people don’t read the entire description, they still see links to read my blog or get in contact with my social:
Write descriptions with keywords. Make it easy for people to find more information about you.
Add Closed Captions on Videos
Ever remembered a great line from a TV show, typed it into Google or YouTube, and found the exact clip on YouTube?
If that great line wasn’t in the title or the description, then you found that because the search engines used the captions to find the video.
That alone should convince you that you need to have captions available for your videos.
The key to optimizing your tags is to place your important terms first. Use quotes for keyword phrases such as “video production” and provide a blend of common and long-tail keywords.
You want to provide enough tags to thoroughly and accurately describe your video. Think about what your potential viewer may be searching for on YouTube.
Drive Comments, Likes, and Subscriptions
When watching a video on YouTube, how often near the end of the video do you hear the phrase, “If you liked this video please give it a thumbs up or make a comment”.
That’s because more likes and comments signal to YouTube that the video is getting audience engagement. People are talking about it and rating it. It struck a chord with them.
As a result, YouTube will rank it higher in their search results.
Another thing that will get a higher ranking is a large number of people subscribing to your channel, and most good YouTube creators and marketers know this. That’s why they ask you to subscribe.
I could write an entire article on getting more YouTube subscriptions. And fortunately, I have. Take a look if you want more subscribers.
Part Three: How to Produce a Great YouTube Video
This is the last part of this blog post, but you should treat it as the most important part of YouTube marketing.
Create a Great Opening and Sustain Viewer Attention
If you’re relatively unknown, then the first few seconds of a video are absolutely crucial to get exactly right. They “hook” the viewer in so they want to watch your entire video.
I’m sure you’ve all seen some ads from Tai Lopez. But have you actually watched them to truly understand what makes him such a great creator?
This was one of Tai’s ads:
When creating an ad, you have five seconds to hook the viewer in so they watch more of your video. You see what Tai Lopez does? The background is him standing in a mansion, and the first thing he says is that he’s going to give you a tour of his mansion.
Then he introduces himself. To keep you watching, he gives you a video tour of the mansion while he talks about himself and what he offers. This is great marketing that few people have done.
Who would want to click “Skip Ad” on this video?
Can you imagine if he was sitting at a desk with a white wall as his background giving the same talk? No one would watch it.
Your videos should work the same way. Even if they aren’t ads, you should treat it them as such. Hook the viewer in with visuals and a few great opening lines. Then keep them entertained. Watch what I do in this video:
My hook comes in with high energy naming companies I’ve ghost-written for. The rest of my intro (which is only 15 seconds) outlines what the video is about and why you can benefit by watching the rest of my presentation.
Create Calls to Action
The key to a successful marketing campaign, even on YouTube, is creating clear and concise calls to action. Depending on the message, you can use the beginning, middle, or end of a video to direct the actions of your viewers.
Having too many prompts can cause confusion, so keep your CTAs minimal and simple. The goal is to make it as easy as possible for viewers to perform an action.
Here are a few important actions to use on your videos:
Subscribe: Give your viewer a reason to subscribe (e.g., new videos every week or never missing an episode).
Like / Add to Favorites / Share: Ask your viewers to “like,” “favorite,” and “share” the video so your content appears in more places across YouTube. You’ll be amazed at the reaction you get when you simply ask for it.
Comments: Encourage your audience to participate by asking a specific question or requesting a topic they’d like to see covered in an upcoming video.
Video Graphics: Create a video “end slate” that appears at the end of the video to direct viewers to your website.
How to Grow Your YouTube Channel
Want to grow your business with YouTube? Here’s a complete guide to building a successful YouTube channel to market your business.
Create a great channel layout.
Use branded images, a video trailer, and organize videos by topics.
Create regular YouTube content.
Aim for a minimum of one video per week, but the right amount of content depends on your audience, your goals, and your content.
Write great YouTube titles.
Write a cliffhanger, but make sure to include key terms.
Design the right thumbnails.
Use arrows and circles to draw attention to your video and consider including a logo to stand out.
Cross-promote your channel on other platforms
Make it a priority to identify and reach out to other similar channels to cross-promote or collaborate in a mutually beneficial manner.
Get your YouTube SEO right.
Use your title and description to target important key terms and increase your visibility.
Add close captions to videos.
Ever remembered a great line from a TV show, typed it into Google or YouTube, and found the exact clip on YouTube? If that great line wasn’t in the title or the description, then you found that because the search engines used the captions to find the video.
Optimize YouTube tags.
The key to optimizing your tags is to place your important terms first. Use quotes for keyword phrases such as “video production” and provide a blend of common and long-tail keywords.
Ask for comments, likes, and subscriptions
More likes and comments signals to YouTube that the video is getting audience engagement, and YouTube will rank it higher in their search results.
Create a great opening.
The first few seconds of a video are absolutely crucial to get exactly right. They “hook” the viewer in so that they want to watch your entire video.
Create calls to action.
Having too many prompts can cause confusion, so keep your CTAs minimal and simple. The goal is to make it as easy as possible for viewers to perform an action.
Conclusion
Congratulations, you made it all the way through this massive guide. Now you are set to become the next YouTube star! Or, at the very least, build a relationship with your target audience through this massively popular platform.
Apply the principles outlined here and grow your presence on YouTube. Remember, it may not work on the first try, but continuing to produce high-quality content on YouTube can deliver amazing results.
Since Instagram’s creation, it has grown into the ultimate platform for sharing photos.
Over 1.16 billion monthly users are active on the site. Daily users spend about 8 minutes on the app and 500 million use Stories daily.
There’s also a large number of influencers on the site with a massive amount of followers. And with the right plan, you can become an influential brand, too.
You need to post the right kind of content to stay relevant to current followers while also bringing in new ones.
But it can be hard to know which kinds of posts work best for growing your audience.
Here are ten powerful Instagram marketing tips (that actually work) that you can use to milk the popular platform for all that it’s worth.
1. Switch to a Business Profile ASAP
Before you start thinking about your Instagram marketing plan, be sure that you have an Instagram Business Account.
Just head to your settings and click on “Switch to Business Profile” to get started.
There are some clear benefits to having a business profile.
For example, followers can click on your contact button to get in touch with you right from your Instagram page just like they would from your website.
A business profile allows you to create and publish Instagram ads without needing to use Facebook’s advertising tools.
You can also access Instagram analytics tools, called Insights, that provide stats about the impressions and reach of your posts.
Once you’ve unlocked the free perks that come along with a business profile, you need to start using them to track metrics and understand your audience.
2. Use Free Instagram Tools
Business profiles on Instagram aren’t all that different from Facebook business profiles.
Through Insights, you can view statistics like impressions, engagement data, and more.
Insights aren’t just generalized, either. You can get specific insights on posts for the week that show you how many impressions you earned for that time period and what your top posts were.
These free tools are priceless because you can use them to understand exactly how users are interacting with your content.
The more that you know about how users are interacting with your posts, the better you can adjust your content to boost engagement.
One category of posts that is almost always attention-grabbing is product teasers.
3. Post Product Teasers That Will (Gently) Urge People to Buy
What if you could sell more products just by posting product teasers on Instagram?
Well, you can.
Instagram is a great place to advertise your products. And if you play your cards right, you won’t annoy users or scare them off with advertisements, either.
If you’re too pushy, followers will drop like flies. But product teaser posts are a simple way to talk about your product and increase excitement without looking like you’re trying too hard.
Here are two posts from Gilt Man’s Instagram page that don’t directly try to sell a product, but offer a free app where users can shop all of the brand’s inventory.
The brand offers a 70% off discount while showing you photos of some of the items that are available to purchase.
And the posts received thousands of likes each, which is huge in the advertising world.
The ads work because they aren’t pushy. They’re laid back. They tease users with the discount and product image to download the app and shop around.
This works for almost any industry. Starbucks teases its audience by announcing seasonal drinks with sharp imagery and without trying to force people to buy them.
When you tease people about products they are interested in, and you don’t push them into buying anything, they’ll be more likely to pull the trigger and actually buy something.
If not, they’ll at least engage with your post by liking it, commenting on it, or sharing it with a friend.
So don’t be afraid to show off the goods by posting product photos. Just do it gently.
This gives brands the ability to target their audience in a whole new way. Before sponsored posts, only users following your account could see your updates and photos.
For sponsored ads, use content that is engaging while also appealing to the target demographic you want to put the ad in front of.
You can turn existing posts into sponsored ads, too, so keep an eye on your top posts.
You can push these high-performing posts out later to potential customers in the form of sponsored ads.
Run multiple posts to different audiences simultaneously for even more engagement. Keep in mind that there are many different forms of sponsored ads that you can post, such as:
Photo
Video
Carousel/Dynamic Ads
Stories
Stories Canvas
Instagram Stories, sponsored or not, are another great way to connect with followers.
Once a user clicks on your photo at the top, a window will pop up where they can view your Story.
The benefits of Instagram Stories for brands are truly endless. For starters, Stories are displayed at the top of follower timelines where users already look daily.
Brands can use stories to capture behind-the-scenes insider posts that may not be as “high-quality” as regular posts.
And you don’t have to worry as much about posting content that aligns with the “aesthetic” of your brand or your Instagram page when it comes to Stories.
Instagram also makes it easy to experiment with different types of content in the Stories feature, like photos, short video, rewind video, live video, or Boomerangs. You can use tools like Canva and InVideo to create amazing images and videos for your stories.
If you haven’t partnered with influencers who are already making a killing on Instagram, find a few that you want to work with and reach out to them.
6. Partner With Influencers For a Wider Reach
If you want to reach potential customers on Instagram, the fastest way to do that is through influencers who have already built an audience with a large following.
More and more people are buying services or products based on what they see in their feed from the influential people they follow. They trust them.
The first step is to try and identify a few influencers that have an audience that is relevant to your product or service.
Here’s an example of how Gravity Blankets used influencer Jessi Smiles to promote their product on her Instagram page.
The post has thousands of likes.
The brand sells weighted blankets for sleep and stress. Their Instagram page has over 77k followers.
But Jessi’s page has over 400,000 followers that will likely trust her recommendations.
That means that the brand just exposed itself to thousands of potential customers (and new followers) through one post.
If you throw aside the short-term gains and direct sales that you can make from an influencer campaign, there are even more long term-benefits.
If you build a relationship with each influencer, you’ll build lasting brand awareness with a new audience.
And if you play your cards right, you could even work with a top influencer in the future to gain millions of likes, like Coca-Cola did with this post from Selena Gomez.
Your existing customers might not be influencers, but you can still use their posts to influence people to buy your products by collecting user-submitted photos.
7. Collect user-submitted photos
Wouldn’t it be nice if there was a way to create great content for your Instagram page without doing any of the hard work?
Through user-submitted photos, there is.
You already have an engaged audience. Whether it’s hundreds of people or thousands, you can leverage your audience to generate useful content for you.
And your followers will probably enjoy user-generated content even more than they enjoy yours because it’s authentic and unpredictable.
Cosmetics brand MAC uses tons of user-generated content that they promote on their Instagram page to show off products.
Here’s a photo one of their users posted that they then added to their Instagram page. Notice how they used the hashtag #regram and tagged the user in the image.
You might be wondering exactly how you can get your users to create engaging content without being pushy.
It’s actually fairly simple. Your audience probably wants to grow their own following, just like you do.
Just let them know that you’ll tag them in your post if you choose their photo to regram, then they’ll have an incentive to post user-generated content on a consistent basis.
Choose images that successfully mimic your brand’s tone, like this one.
That being said, try not to be too biased about the content you want to post. Mix it up and watch your follower count and engagement grow.
It also helps to come up with some kind of branded hashtag that encourages Instagram users to be more interactive with your company.
8. Come Up With an Interactive Branded Hashtag
If you’re looking to create instant engagement, interactive hashtags are a great way to get it.
Red Bull has racked up over 299,612 posts featuring their tag, #itgivesyouwings.
Customers can then use the tag to post user-generated content. This allows users to search through all posts relating to your brand.
It also lets you easily search through images that you might want to consider re-posting on your own page.
Creating a hashtag that your company (and other users) can search for is essentially free advertising.
Every time someone posts a photo using the tag, they’re exposing your company to their followers.
If you already have a popular brand slogan or phrase, consider making that your branded hashtag. Coca-Cola successfully accomplished this with their hashtag, #ShareACoke.
But no matter what you’re posting, you need to post at the right times and refrain from over-posting.
9. Post at The Right Times (and Don’t Over-Post)
Over-posting on Instagram is a surefire way to turn off your existing followers.
If all they see is your brand on their news feed, they’re probably going to unfollow you as fast as possible.
But you want to post on a consistent basis so that you stay in their news feed regularly.
One of the best ways to do this is to only post during peak days and hours when your followers are online.
According to SimplyMeasured, the worst days to post on Instagram are Wednesdays and Sundays, while Mondays and Thursdays are the best days to post.
And according to research from CoSchedule, the best times of day to post are between 8:00 AM and 9:00 AM, as well as 2:00 AM.
The hour between of 8:00 and 9:00 AM correlates with the time of day when people are getting ready for work or commuting to their jobs (and checking social media for the day).
And 2:00 AM is the time of day when most folks are up scrolling through Instagram when they should be sleeping, so this makes sense as a second most popular time to post.
That way, you won’t overwhelm your followers’ feeds.
After you’ve made these changes, track your metrics to keep an eye on areas where you can improve.
10. Make Sure You Track The Right Metrics
You can’t improve your Instagram performance and optimize it unless you know how well your page and posts are performing (or underperforming).
When you have measurable results, you’ll know exactly what works and what doesn’t.
Begin by tracking your follower growth rate.
The total amount of followers you have is commonly seen as a vanity metric. And it is.
But your follower growth rate isn’t.
When you keep an eye on what the growth rate of your followers looks like, you can see how the kind of content your posting (or your posting frequency) is affecting things.
Next, measure engagement rates. This includes likes and comments.
You want to find out the average engagement percentage of your total followers as well as the average engagement rate of each post to get a clear picture of how your page is performing.
The more effective your Instagram marketing techniques on your audience, the higher your CTR will be. If it’s low, work on improving your approach.
A tool like Sprout Social will measure just how many clicks that your link is getting in comparison to impressions and engagements.
Conclusion
Instagram has dominated the social media world. It’s the go-to place for image sharing, with over 800 million monthly users.
Billions of likes are handed out each day, so you need to do your part to scoop some of them up.
First, switch your profile to an Instagram Business Profile if you haven’t already. This will give you tons of free tools and insights.
Next, start taking advantage of those free tools. Check out your audience’s demographics, like their age or top locations.
Post product teasers to urge people to buy your products or services without being overly pushy. They’ll be more likely to buy if they don’t feel pressured.
Turn your posts into sponsored ads to reach target audiences that may not be following you yet. One post might just have them hooked.
Use Instagram Stories to post behind-the-scenes photos or videos. Followers will appreciate the insider posts, which builds your relationship with customers.
Partner with influencers that have a wide reach in your industry. Their followers trust their recommendations.
Be sure to leverage the power of user-generated content by reposting images that your customers share. You can turn this into a contest with an interactive branded hashtag.
Choose a photo to share every week or every month that aligns with your brand’s message.
Post at the right times and avoid overposting. Post one to two times every day and check out when your followers are most active. Schedule posts to go live during those days and times.
Finally, be sure that you track the right metrics to see how your Instagram marketing efforts are paying off.
Keep an eye on follower growth rate, engagement rate, and your URL click-through rate.
email: dcolinmorgan@gmail.com (also my username for github and linkedin)
I love plotting and data visualization.
I am finishing a postdoctoral fellowship at harvard medical school looking to break out of academia. My PhD dissertation was in graph and network theory, applying nonlinear models to biodata (all kinds of ‘omics) and I now work on time course trajectory modeling with LSTMs mostly, as well as integration of many ‘omics to predict novel therapeutics
Prompt | Tech Lead | Remote (we’re based in NYC) | Full-Time | https://prompt.com
We provide writing tutoring and feedback at scale to students around the world. Our small engineering team is responsible for software that has been used by high schools, education consultants, and our network of writing coaches to provide feedback on hundreds of thousands of essays.
Here’s the role: sling code, architect new systems, mentor junior engineers, and manage product as a tech lead on Prompt’s growing dev team. You will work directly with Prompt’s two technical co-founders and other engineers in a culture that includes clean code, extensive testing, rapid iteration, and the values you bring to the table. You will come to own one of our product lines, and will have the ability to contribute to multiple projects.
We use: Python/Django (with Django Rest Framework) on the backend; React/Redux via Typescript on the frontend. We also use Celery for distributed tasks, a slew of Twilio and Zoom APIs, GCP (mostly for data & analytics) and AWS (for all of our app hosting and other infra).
There are Three Different Credit Bureaus – But What are the Real Differences Among Them?
What distinguishes the three different credit bureaus? And can you use that information to your advantage?
Business Credit Reporting Agencies
There are three different credit bureaus for business: Dun & Bradstreet, Experian, and Equifax. FICO SBSS and CreditSafe are also players.
In the business world Equifax and Experian are up there, but it’s Dun & Bradstreet which is the major player. In the consumer world the three main reporting agencies (TransUnion, Equifax, and Experian) have a similar number of consumer records. This has to do in large part with them splitting up the smaller reporting agencies between them over many decades.
But in the business world, D&B has more than 10 times the records of the next closest reporting agency. In the business credit world there really is one major player, with two other much smaller ones. See dnb.com/about-us/company.html. It makes sense to start with D&B when comparing the business CRAs, because you’ll have to start the business credit building process with them anyway.
Dun & Bradstreet
D&B is the oldest and largest credit reporting agency. Go to D&B’s website and look for your business, at dnb.com/duns-number. Can’t find it? Then get a free D-U-N-S number. You will always need a D-U-N-S number to start building business credit. Go here to get a D-U-N-S number: dnb.com/duns-number/get-a-duns.html.
D&B Scores
A D-U-N-S number is how D&B gets your company into their system. And a D-U-N-S number plus 3 payment experiences leads to a PAYDEX score. A payment experience is a record of a purchase from a business which reports to a credit reporting agency. In this case, D&B. Once you are in D&B’s system, search Equifax and Experian’s sites for your business. You can do so at creditsuite.com/reports.
D&B Reports
D&B offers database-generated reports. In general when D&B does not have all of the data they need, they will indicate as much in their reports. But missing data does not necessarily mean a company is a poor credit risk. Instead, the risk is unknown. To ensure as accurate a report as possible, give D&B your company’s current financial statements.
Dun & Bradstreet Scores
PAYDEX is probably the best-known D&B score. Some others are:
PAYDEX is Dun & Bradstreet’s dollar-weighted numerical rating of how a company has paid its bills over the past year. D&B bases this score on trade experiences which various vendors report. The score ranges from 1 to 100. Higher scores mean a better payment performance. PAYDEX scores reflect how well a company pays its bills.
What Influences Your PAYDEX Score?
Larger bills get more weight in the calculation. D&B gathers payment experiences from suppliers and vendors a firm does business with. Each experience reflects a different supplier and reflects how bills are met within relation to the terms granted. Up to 875 payment experiences are used to generate the PAYDEX Score. And up to 80 representative payment experiences are reported in your credit report.
PAYDEX Numbers
D&B has created risk categories to make it easier to translate a PAYDEX score into understandable risk groups:
PAYDEX 80-100: Low risk of late payment
PAYDEX 50-79: Moderate risk of late payment.
and PAYDEX 0-49: High risk of late payment
D&B takes a proactive approach to notify you when a change in your PAYDEX score is bringing you closer to a different risk category
Improving Your PAYDEX Score
Addressing any problems head-on is a useful strategy. Hence if your business is regularly late with payments, then you should address issues of organization and perhaps time management. Since the score is dollar-weighted, you quite literally get more bang for your buck by paying your bigger bills first. And because it reflects trends, you can help out your business by starting a practice of paying on time and sticking with it.
D&B Business Information Reports
For a snapshot of your business’s financial health, the best report to get is probably a Business Information Report. Currently, it costs $139.99. You can get a Business Information Report on your own business or on a company you’re considering doing business with.
Along with a PAYDEX score, a D&B Business Information Report contains:
Trade payments (summary and by industry)
Trade line specifics with dollar amounts and terms
Legal events
Company events (mainly concerning ownership and management)
A company family tree showing ownership specifics
Risk Assessment Summary
A Business Information Report also contains a Risk Assessment Summary. It shows:
Experian is a whole other ballgame. While business credit is credit which in a business’s name, and it depends on how well a company can pay its bills, Experian uses both consumer and business credit information to gauge risk.
“By combining personal and commercial credit information in one report, Experian provides a complete picture of the creditworthiness of small businesses”
You Will Need to Get Set Up with Experian
Get a BIN (Business Identification Number) from Experian. Experian’s BizSource assigns a BIN.
Experian’s Blended Score
This is summary information on a business and its owner. For troubled businesses, blended scores dropped an average of 30% over the four quarters leading up to a “bad” event. 53% of the time, the first signs of credit problems were on the business credit reports. And 46% of the time, the first signs of credit problems were on the owner’s personal report. Blended scores have been found to outperform consumer or business alone by 10 – 20%.
Experian CreditScore SM Report
With this report, you get an Experian Business Credit Score (Intelliscore). It includes the Experian Financial Stability Risk Rating. It also has information on derogatories like judgments, tax liens, and bankruptcies. You can learn about any fictitious business name information in the file. As of the fourth quarter of 2020, this report costs $39.95.
Experian BizVerify Report
This is a more basic report but it has less in it. As of the fourth quarter of 2020, this report costs less than $20. It is Experian’s snapshot view of a business credit file. Use this report to verify if a new business is in their National Business Database.
This brief summary report provides any available information on a business’s registration information. This is even for businesses that have not yet established an Experian business credit score. This isn’t much of a monitoring product; it’s more to make sure a business is in Experian’s records.
Improving Your Company’s Experian Report
Make sure vendors are reporting your payments, and not just with Experian. Pay bills early or on time, in full. For Experian, historical behavior (payment history) = 5-10% of total score. Try to maintain your personal credit utilization at about 20 – 30% of your limits or less. Don’t close positive accounts even if you no longer use them. And try to avoid derogatories like liens.
A data sharing agreement with the Small Business Exchange
Net 30 type industry trade credit information from a wide variety of suppliers
These suppliers provide products and services to businesses on an invoice basis
Equifax scores answer one basic question. How likely is a business to go severely delinquent in its payments? The score is an indication of whether a company is likely to make late payments.
Scores
Equifax has a few main scores:
Small Business Credit Risk Score for Financial Services
You can get risk score alerts. You can learn about potential risk based on a significant negative change to any of four predictive risk scores. They are the Business Credit Risk Score, Payment Index, Business Failure Score, and Business Delinquency Score.
A FICO SBSS score is different from other business credit agency scores. With other credit reports from business credit reporting agencies, you can get a copy of your credit report and know where you stand. But this is not so with the FICO SBSS. Also, it can differ from lender to lender. The SBA requires a FICO SBSS score of at least 150 to lend to a business.
CreditSafe (in brief)
Credit reporting agency CreditSafe has the biggest wholly owned database in the industry. They gather data from local, trusted partners and combine it with a scoring algorithm. CreditSafe administers a global network of leading commercial credit reference agencies. They have live data streams for over 70 countries but are less well known than the others. See: creditsafe.com/us/en/more/about/our-data.html.
How Long Data Stays on Your Reports at the Different Credit Bureaus
Per Experian Business, bankruptcies stay for 7 to 10 years. Chapter 13 bankruptcy rolls off your credit report 7 years from the filing date, while Chapter 7 bankruptcy stays for 10 years from the filing date. Trade data stays on for 36 months. Judgments, collections, and also tax liens stay on for 6 years and 9 months. UCC filings stay on for 5 years. See experian.com/small-business/how-long-credit-report. There are similar time frames for the different credit bureaus.
Disputing Issues with Your Credit Scores and Reports at the Different Credit Bureaus
None of the different business bureaus will change your scores without proof. They are also starting to accept more and more online disputes. Also include proofs of payment with it. These are documents like receipts and cancelled checks.
Fixing credit report errors also means you specifically spell out any charges you challenge. Make your dispute as crystal clear as possible. If you need to snail mail anything in, then use certified mail so that you will have proof that you sent in your dispute.
With all the different credit bureaus, be specific about the concerns with your report. D&B wants you to go through their Customer Service. You can also go through D&B Customer Service to add payment experiences. D&B’s Customer Service contact number can be found at dandb.com/glossary/paydex.
Monitoring D&B Credit Scores and Reports
Business credit reports are not always perfectly correct. All of the major CRAs are committed to accuracy. But you won’t know there are errors unless you monitor your business credit reports.
The costs of monitoring can add up fast. At Experian, your best (least expensive) bet would be a Business Credit Advantage. Subscription Plan. Also, it currently costs $189 per year. See sbcr.experian.com/pdp.aspx?pg=Sample&link.
Monitoring Equifax Credit Scores and Reports
At Equifax, you would use Equifax Complete. It currently costs $19.95 per month, after an offer of 30 days for $4.95. See equifax.com/equifax-complete/Equifax.
Monitoring Your Business Credit Scores and Reports
Add these all together for a year and it’s $468 for D&B, $189 for Experian, and $224.40 for Equifax (with the special). For a grand total of $881.40!
Monitoring Your D&B, Experian, and Equifax Credit Scores and Reports
You can monitor your business credit at D&B, Equifax, and Experian through Credit Suite, for considerable savings over what it would cost you at those different credit bureaus. Also, it’s all in one place! Credit Suite offers monitoring through the Business Finance Suite (through Nav). See what credit issuers and lenders see so you can directly improve your scores and get the business credit and funding you need. See suitelogin.com and creditsuite.com/monitoring.
The Three Different Credit Bureaus: Takeaways
The different credit bureaus are similar but not identical. D&B is the largest and a D-U-N-S number is an absolute necessity for business credit building. Experian gets some of its scoring from your personal credit habits. Equifax gets much of its data from the Small Business Financial Exchange. CreditSafe and the FICO SBSS are also players in this space.
Monitoring all this is expensive. But you can save 90% by monitoring your D&B, Experian, and Equifax scores through Credit Suite.
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