Women in Business Flex Their Muscles

In the end, it all came down to a feeling of comfort for Martha Diaz Aszkenazy.

The owner of a growing San Fernando construction firm needed a new cellular phone service.

First, she listened to two salesmen from Nextel Communications talk at a male-dominated builders group meeting.

“They kept stressing all the bells and whistles, how powerful the phone was--kind of like the comedian on ‘Home Improvement,’ ” she said. “I don’t care about how the phone works. I’m not interested in all the power. I just want it to work.”

Then a female representative from AirTouch Cellular called on Diaz Aszkenazy’s firm--part of AirTouch’s growing emphasis on women business owners. She phoned and visited several times, and dropped off a free leather phone cover.

“Her style as a woman appealed to us,” said Diaz Aszkenazy, who is deluged almost every day with brochures and advertisements targeting women business owners. “It was very, very comfortable. We talked on a woman level. She was available by cell phone and pager and didn’t think our questions were dumb. And no one else,” she said wryly, “was offering those cute covers.”

Diaz Aszkenazy, whose firm recently rebuilt Angels Flight, the tiny downtown railway, is one of a growing number of women business owners throughout America. These women are no longer just fledgling entrepreneurs. They are increasingly at the helm of vibrant businesses, wielding increasing economic clout with the purchases they make.

This fundamental shift in the economic landscape has many corporations, including IBM, AT&T;, Wells Fargo and BancOne, rushing to tap this market, even to the point of seeming downright sensitive to the needs of women.

Companies both large and small are trying to learn the language of women business owners--devising marketing strategies that target such entrepreneurs based on studies that show they often are quite different from their male counterparts in what they want, in the purchases they make and how they manage.

Corporate America has “discovered women--big time,” said Judith Luther Wilder, co-head of Women’s Inc., a Sacramento-based nonprofit organization that links women business owners with some of the nation’s biggest companies. “Women have always had some market share. Now they have market power.”

The numbers show why:

* About 8 million women own businesses, a 78% increase from 10 years ago. These businesses generate $2.3 trillion in sales. Women are starting new businesses at three times the rate of men.

* In Los Angeles County, women started 21,300 businesses in 1996, nearly double the number in 1992, according to County Data Corp., a Vermont data firm. Nationwide, women formed about 342,200 businesses in 1996, nearly triple the number in 1992.

* Women own 36% of U.S. companies and employ 35% more people than the Fortune 500, according to recent figures.

* By 2000, about half of America’s businesses will have a female owner, the U.S. Department of Labor projects.

“Women business owners have been around for a long time, but the economic powerhouse they are starting to represent--that’s what is waking us up,” said Lucile Reid, who directs Wells Fargo Bank’s $10-billion loan program for women owners. “They’ve grown from being tiny businesses to strong, small businesses with great growth prospects, so you better pay attention.”

Still, some argue that advertising focusing on women entrepreneurs unfairly stereotypes them as all the same and creates gender-segregated services. It may also exacerbate tensions between men and women in the workplace and elsewhere.

“All of that may be the unintended consequences,” said Ivan Preston, a professor of advertising at the University of Wisconsin. “But advertising in general has become more segregated over time. Advertisers don’t sit around saying, ‘How can we ghettoize women?’ They just want to sell. It’s not always right, but it’s the mantra now to market to smaller and smaller groups.”

Corporations such as IBM have created divisions to target women business owners and are hiring women to lead them. Some companies are launching advertisements such as AT&T;’s television commercial about two female entrepreneurs who create bendable sunglasses. Others are adding more women to their sales forces and training salespeople to be more sensitive to women’s management and purchasing styles.

In an ironic twist, this has major corporations rushing to meet the needs of some of the same women who found themselves unable to get their Fortune 500 employers to adopt the women-friendly policies that might have encouraged them to stay.

“They’re more and more interested in us. Lately, we’ve been inundated with calls from corporations wanting to market to us,” said Phyllis Hill Slater, who owns an engineering firm on Long Island and is the new president of the National Assn. of Women Business Owners, a trade group with nearly 10,000 members.

“And when corporate America recognizes you, all companies recognize you. Nothing levels a playing field like money,” she said.

These firms are adopting new marketing tactics to reach women because studies have shown that, in general, women operate differently from their male counterparts.

For instance, women tend to be consensus builders. They take more time and require more information before making key purchasing decisions, such as buying computers, according to a study by the trade group.

Some small-business owners are critical of these studies, which often are funded in part by giant corporations. They say they are designed to back up corporate marketing strategies. But others say they are illuminating, and point to women they know as examples of the findings.

Take Shirley Oberst Kauffman.

Since she began running Du-par’s Restaurants three years ago after her father’s stroke, she has opened a new coffee shop, begun the first major remodeling of a Du-par’s in 25 years and is shopping to buy the 59-year-old chain its first computer.

Once Kauffman, 35, embarked on the remodeling of Du-par’s Studio City, contractors began calling her with bids. And calling again and again, although she wasn’t ready to make a decision. When picking a new color for the booths, wall paneling and other details for the restaurant, she often would query waitresses, cooks, table cleaners and other employees who have been with Du-par’s for decades to determine their feelings.

“I always appreciate being asked, and I think other people appreciate that too,” said Kauffman, who began working in the Du-par’s Farmers Market restaurant as a cashier when she was 16. “I might not follow what they have to say, but I want to give them an opportunity.”

She is typical of women business operators nationwide, experts say, in that she gathers information from various sources before making a decision.

“There is a difference,” said Sharon Hadary, executive director of the National Foundation for Women Business Owners, a research group. “When men say, ‘I’ll think about it,’ they often mean no. But a woman really means that she needs some time to think about it.”

One company that found that out is AT&T.;

This giant teaches its sales force that women business owners are looking for a partnership with their telecommunications company and that women would rather purchase big-ticket items from people, particularly people they know, instead of from catalogs.

They also teach their salespeople to have patience.

“A woman business owner will want to see an AT&T; person three or four times” before they buy a phone system, said Donna Chancellor, director of communications for AT&T.; “We tell our salespeople that it’s not going to be a quick and easy sale, but it will happen. Relationships and trust are important.”

Studies have shown that women place a greater priority on establishing long-term relationships with those they buy products from. And once they contract with a supplier, they tend to remain with them.

That’s because, some women executives say, women must often work harder than men to be taken seriously. Once female business owners find someone who takes them seriously, it is much easier to keep working with that person than to spend time and energy proving themselves to someone else. In fact, because women sometimes are burned by those who think they are easy marks, these entrepreneurs like to stick with people they trust.

“I hate haggling,” said Diaz Aszkenazy, who owns Pueblo Contracting Services. “I always feel that as a woman I am taken advantage of when I purchase things. Some take advantage of the fact that we do business on more intuitive feeling than hard numbers shopping.”

Some business owners dispute the generalizations about women entrepreneurs, saying such conclusions serve only to keep them from attaining equal footing with men.

Scott Hague, chairman of the California Small Business Assn., a networking group of 19 business associations, doesn’t think women and men entrepreneurs are different.

“First of all, being a man, I admit to all prejudices I have,” Hague said jokingly. “But I really don’t think women business owners’ needs are really that different--with the exception of child care.”

Even so, Hague said that if he ran IBM or AT&T;, he would follow their example and market differently to women. The reason is that in his experience, women identify with being women small-business owners first, and being business owners second.

“Almost every corporation is doing this type of marketing. Mostly because there are not a lot of women business owners who have gone beyond the step of being involved in just women’s issues,” he said.

Studies also have shown that women entrepreneurs differ from men in how they purchase technology, with women placing a higher value on having a toll-free or 24-hour hotline and on the warranty offered.

Corporations who recognize this are having more luck with business owners such as Jennifer Guillory.

Three years ago she started the Calitec security firm in her San Diego home after her three daughters moved out. She started with just $1,000--basically the last paycheck from her clerical job at a large company. Calitec has grown to 80 workers, and she expects to post about $2 million in sales this year.

She recently contracted with San Diego County to provide security for its courthouses. Guillory said that although she is in a male-dominated industry, her style differs greatly from a man’s.

“When I look for a bank or a computer company, I look for an institution that will work with me and we’re going to grow together,” she said.

She recently spent $10,000 with Compaq Computer because she likes its information line.

“Women are looking at not only the reason and logic but the pricing and support. A guy is into the mechanics and thinks he can fix things himself,” she said. “I look for a relationship I can continue to pull from . . . like a family.”

In fact, women business owners are often on the leading edge of new technology, and companies such as Lucent Technologies are trying to market to women-owned businesses while the firms are still small.

“It’s a top priority for us--we’re really stepping up our efforts,” said Linda Keenan, director of association marketing for Lucent.

Another giant in this area is IBM. Early on, the firm identified women business owners as a growing and potentially lucrative market sector and has earmarked millions of dollars targeting them.

Now, IBM is beginning to further segment its marketing--reworking new advertisements that will focus on businesses owned by minority women. One even features Diaz Aszkenazy.

Why? In June, IBM unveiled research finding that such businesses are growing at triple the rate of U.S. businesses overall. There were about 1 million in 1996, a 153% increase since 1987.

California is the No. 1 state for businesses owned by minority women, the study found. The state had 287,000 such businesses in 1996, more than the next three highest states combined.

IBM has 50 people across the United States focused on women-owned businesses and helping them to use technology to compete. The company has set up a phone line for women to use in ordering computers and getting questions answered.

Wells Fargo realized early that Calitec’s Guillory was a good bet.

“Women business owners are different,” said Reid of Wells Fargo. “Their businesses really aren’t, but the mix is, and what they care about it is.”

Most of all, Reid said, women want to be taken seriously. That’s why Wells Fargo is about to embark on a new ad campaign that reads:

“We’re not doing it to be nice. We’re not doing it to be politically correct. We’re lending $10 billion to women-owned businesses because women make money.”

Another of America’s largest banks, BancOne in Cleveland, also is targeting women. Vanessa Freytag was recently moved to a new position as director of national women entrepreneurs initiative.

She has identified three priorities for women: They want to be taken seriously, they are looking for a relationship with a financial institution and they want information presented in straight and clear ways.

“We try to make sure everything we do for women has these three messages,” Freytag said. “And it’s not that men don’t want these same things; they are often just further down on the list.”

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Business Start-Ups

Total number of new businesses formed by women in the United States:

In hundreds of thousands

1996: 342,165

****

CALIFORNIA START-UPS

In thousands

Source: County Data Corp.