The Relentless Marketer: Forget the Superbowl Ad

FORTUNE SMALL BUSINESS, October 2000

By Bill Robinson

The best marketing tool is word-of-mouth advertising. Ask Johan Jorgensen, founder of the Swedish Internet firm Municel.

Frustrated because you don't have a big enough marketing budget to buy a Superbowl ad? Maybe it's time to take a fresh look at your situation. What many business people are discovering is the most effective -- and inexpensive -- way to promote their companies is not with traditional advertising or marketing campaigns but through word-of-mouth recommendations. They're finding that this more casual approach wins over customers and plays a powerful role in building their businesses.

Johan Jorgensen is one businessman who's a master networker. To promote his new Stockholm-based Internet company, Municel, he speaks frequently with an informal group of associates, industry leaders, and media people, on the supposition that those contacts will eventually make his company known to the press, business people, and government officials.

Municel, launched in 1999, provides a Website where governments, local municipalities, county councils, and trade and community organizations can buy their supplies. A local school district, for instance, can go to Municel's site to order textbooks, desks, pencils and notebooks. Municel makes money on each business-to-business transaction. "We were looking for new ideas, to capitalize on the promise of the Internet and move products using code," Jorgensen says.

The best way for Municel to get an in with government and union officials, Jorgensen says, is to have his employees and executives spread the word. The company doesn't spend any money on conventional advertising. "We rely upon a tremendous amount of PR," he says. "Everyone at Municel writes and gives speeches regularly." Jorgensen, who writes columns for four Swedish newspapers, discusses his ideas on how the private sector can operate more efficiently through the Internet. "I'm a former journalist and have been networking all my life," he says. "You have to enjoy connecting people for the benefit of all."

Part of Municel's influential marketing network is its own employees. Jorgensen set up a top-tier management structure comprised of well-known Swedish civic and business leaders to reach government officials. The board includes the chairman of the Swedish railroads, a founder of the country's largest school supplier, a former Minister of Education and State Secretary, a lead advisor to the government on information technology, and the second chairman of Sweden's largest trade union. And until recently, Municel's CEO was the father of Ola Ahlvarsson, "Europe's Internet Pin-up Boy," who set up 22 Swedish Internet companies. It didn't hurt that Ahlvarsson's father is also a powerful civic leader. "You want to get your people out into the press and giving speeches to establish them as individuals," Jorgensen says. "People don't buy products or services, they buy individuals -- strong and capable individuals."

I had the opportunity to see Jorgensen's networking techniques in action on a recent visit to Stockholm. When I mentioned to Jorgensen that I would be staying in his city for a few days, he quickly arranged meetings for me with Jan Carlzon, former head and turnaround legend at SAS Airlines, Sven-Chister Nilsson, the former CEO of Ericsson and Ola Ahlvarsson. As it turned out all of these business executives were invaluable to me as resources for a column I was writing at the time. While Jorgensen's company didn't benefit from those meetings, he's counting on those connections all of us made that day to serve Municel at some point in the future.

Jorgensen realizes it'll take time for this networking to pay off because it takes a long time to win over government officials. But he's in no rush. And so far, he's off to a good start. He projects Municel revenue will reach $2 million in 2000. "You have to be relentless when you're dealing with the government because you are talking about people who make decisions based on fear, not quality or service," he says. "You absolutely must establish trust, there are no easy deals you have to be relentless."