Biz Crusader

 

 

After working with both large corporations and small businesses, there are a number of distinct differences I have noted when it comes to executing marketing strategies.

 

One glaring example is what I call the “Failure to Commit.”  Smaller companies have a very difficult time coming up with a marketing plan and sticking to it.  And as a result, each plan which sounded brilliant in the conference room when conceived, never gets an opportunity to come to fruition.  When a plan doesn’t deliver almost immediate sales results, it is put to death and a new plan is put in place at the next marketing meeting.  It’s the ultimate in stopping short of the goal in a business environment.

 

 

It’s the owner.  Because finances at a smaller company are tied closely to the owner’s personal finances, it makes him or her react emotionally rather than logically.  To put it simply, when they see money going out the door and they don’t see short term sales returns, they get scared.  And when they are scared, they start questioning themselves as well as everything or everyone around them.  When this perfect storm occurs, they also place very little value on mid-to-long term goals and the step-by-step building which is required for marketing value is brought to a screeching halt.

 

Over time, marketing strategies tend to look like a zigzag of failed attempts instead of any tangible or measurable business trends.  The irony in all of this is that small businesses will probably spend more money over time because every new attempt requires an infusion of cash.

 

In a corporate environment, this emotional factor is absent because the decision makers in marketing are focusing on the plan only and have no personal finances attached to their decisions.  And as a result, they are able to objectively see a strategy through and commit to the value it has promised to deliver.  This of course doesn’t mean that each plan is wildly successful.  It just means that they stick to it long enough to get an answer–one way or the other.

 

As you plan your marketing strategies and budgets for 2010, think about your level of commitment.  Do you have a problem with commitment?  You might have a “Failure to Commit” issue.

 

I hear often “I’ve built this company over 20 years and we’re successful as a small business.  We just need your help getting to the “Next Level.”

 

Commitment to your plans and avoiding the zigzag is at the CORE of getting to that NEXT LEVEL.

 

IT NEVER FAILS.

 

Bad economic conditions always lead to poor customer service.

 

Don’t ask me why this happens but it always does.  Whenever companies (mostly large ones) are faced with tighter budgets, the group that inevitably pays the price are their customers.  It can be an onerous return policy, a hike in fees or maybe headcount sacrifices in customer service departments.  Instead of a phone tree, you are faced with a “phone forest”.

 

 

CAUTION:

 

This… I’ll screw them over now and deal with it later approach is not what it used to be.  It’s true that in the past consumers did forget eventually once the economy got humming again but it might be harder in this technological age to rely on this business practice.

 

Due to the prevalence of social media interaction on the web, it will be much harder for corporations to erase their evil deeds during this recession.  Blog posts, facebook groups, peer online reviews, tweets and archived online news articles are in essence… FOREVER.

 

The bottom line is that it always costs more to acquire new customers when compared to keeping and growing the customers you already have.  The next time you find yourself in a conference room discussing budget cuts and going through the line items, don’t reduce your customer service and don’t look to your existing customers for more fees.  After all, we are still living in a free economy where Capitalism prevails.  Your customers always have the option to leave you in an “Internet Minute”.

 

I’ve been working with a number of e-commerce clients lately and this question seems to come up often.  If you’re selling tangible products online, it’s not enough these days just to ship an order in a timely manner.  An online store owner should view the box as another opportunity to market their products.  Just by including the right items in the fulfillment box, you can exponentially increase the chances for a return visit and a follow-up sale.

 

Here are some proven marketing ideas.

 

 

1)  Return Visit Coupon:  Include a coupon code for their next visit.  You can offer a certain percentage off, a dollar amount or something like free shipping.  Be sure to note an expiration date so that you can get the return visit and sale within a few weeks.  And because you’re running an e-commerce store, you’ll be able to easily track usage of these coupon codes.

 

2)  Product Specific Promotion:  Include a brochure or a flyer promoting a specific product.  The promotion should be presented as an exclusive offer with a corresponding coupon code.  This type of promotion should also have an expiration date to generate a quick return visit.  Again, you should be able to track the usage of the coupons easily.

 

3)  Return & Interact for Reward:  Whether it’s for an online survey or to enter a contest, invite them back to a specific URL destination to interact and participate.  When they do this, you will reward them with some random offer or gift.  This method keeps it fun and it allows the visitor to play a game of chance at your web site.  If this method is used properly, you can also collect some valuable marketing research information from their return visit.

 

4)  VIP Access:  Give them exclusive access to a VIP area of your web site.  This would be a web page that could not be found unless you knew the specific URL.  In this area, you can offer special deals or clearance items.  Make the deals outrageous and they will return time after time to check out what deals have been posted to the area.  Don’t be so concerned about only selling these clearance items.  During most return visits, they will also check out the rest of your web site.  Navigation paths should be strategically located throughout this VIP area to encourage navigation to the rest of your web site.

 

5)  Promotional Item:  This is the easy one.  Add some low cost giveaway item.  The hard part will be to include an item that has some relevance to your core products.  There are three questions to ask when determining what to give away.  First, is your product branded with your logo and web address?  Second, how often will it be shown or displayed before your key target demographic?  And finally, how short will the distance be between this giveaway item and your next sale?  For example, let’s say your giveaway item is a mousepad.  The distance between your giveaway item and the next sale which will occur on their computer screen is pretty short isn’t it?

 

6)  Piggy Back:  This is the “you scratch my back and I’ll scratch yours” marketing.  Identify e-commerce partners who sell products that have synergy with your products.  Once you’ve identified these partners, you will include an offer from them in your fulfillment boxes.  And in return, they will do the same for you in their fulfillment boxes.  This is a real win-win situation and it allows all participating stores to be introduced to new potential customers.  From a customer point-of-view, it will be accepted as a benefit because you are introducing multiple offers to them from companies that have close synergy to your products, which they have just purchased.

 

7)  Free Samples:  Depending on what you sell, you might want to consider including free samples along with every order.  The free sample must be accompanied by a specific promotion coupon code for the customer to go to your site and buy more.  Give them a try and then show them how to buy more at a discount.  Just think about Costco’s free food samples.  You’ll be using the same method except it’s in an e-commerce environment.

 

 

Some of you may hesitate to implement any of the above because of your profit and margin concerns.  When analyzing this concern, keep in mind the following.  Whatever the cost may be, I guarantee it will be much cheaper than acquiring a new customer.  This strategy is about maximizing the return from customers you already have.

 

Learn to think in…RESIDUALS.

 

 

 

 

It was just before Christmas.  Like all other shoppers going through the motions, I had stopped by a gift shop after work to pick-up a few last minute items.  My destination was a small but established neighborhood store.  After getting the items I needed, I got in line behind a few ladies who clearly knew a lot more about gift giving than I did.  Their little handheld baskets were full of trinkets and other festive items sure to make some one’s holiday a little more merrier. 

 

As the first woman unloaded her items on to the counter, she was greeted by the bubbly 16 year old cashier.  She scanned each item and I watched as the LED sub-total on the little balance screen got higher and higher.  The grand total was just over $150.00.  The lady reached in to her purse and promptly paid in cash.  Smiles were all around and it was a scene we’ve all witnessed a thousand times.

 

It was the second lady’s turn and the entire scene played it self out again as if the setting was on replay.  Her total was just over $100.00.

As I watched both of them walk out of the store, I thought to myself… “They might as well be ghosts.”

 

This little boutique had just sold $250 worth of goods in 5 minutes and the owner has no idea who they just did business with.  They don’t know if they are new customers or regulars.  They wouldn’t know how to contact them again to build any sort of a relationship.  They have no idea how they ended up at their store.  In essence, the owner of this boutique store just did business with a couple of ghosts.

 

Retail settings are perfect for witnessing and demonstrating business theories.  This is because a simple retail transaction is about as “pure” as it gets to define doing business—buy low and sell high.

 

Many businesses are doing business with ghosts everyday.  The goal should be to identify who these ghost customers are so that a relationship can be initiated and grown.  Instead of constantly hunting for new customers with expensive mass market advertising, how about just taking good care of the ones you already have.  Not only will you be able to grow the relationship, these known customers are also your best candidates to be unpaid business ambassadors.

 

For those of you not operating a retail business, this effects you as well.

 

 

 

1)  No contact information collected during transaction

2)  No contact after the original transaction

3)  At least 6 months since last contact

 

If just one of the above three definitions apply towards any of your customers, you have unintentionally turned a customer back in to a prospect.

 

 

 

1)  Collect contact information especially email and address.  Some customers like anonymity so do your best.  Set policies in motion to collect data during the transaction.  Consider creative methods like offering incentives or benefits in exchange for the information.

2)  Create a contact schedule for each customer.  For example, a retail store could send out a postcard 4 times a year during their busiest months offering their repeat customers a discount.

3)  Implement an effective CRM (customer relationship management) tool to keep in contact with your customer base.  A simple low cost start can be to implement some sort of an email marketing communication.  Services like Constant Contact or iContact is an easy do-it-yourself tool.

 

 

In many businesses, 20% of your customers will be generating 80% of your revenues.  Constantly hunting for new customers in a recession can be difficult and expensive.  In order to grow your business, look towards those customers who’ve already done business with you.  They are the low hanging fruits.

 

STOP doing business with ghosts.  This is a good place to begin.

 

 

 

There are many of you reading my little business blog—some now from the Chicago Tribune.  They’ve started picking up on some of my posts via a blog syndication network.  Welcome all new readers.

 

I have a confession to make.  I really struggled with this post.  This is my first post of 2009 and I wanted to share something that would help all of us reflect as business owners.  As you grit your teeth, lean forward and go about the business of running a business, please keep the following in mind.

 

Normally, I am always writing about what specific thing you can do or implement to improve your business.  Today, I plan on doing the opposite.

 

As the new business year gets under way, I want you to create a “What Not To Do” list.  Whether we abide by them or not, as business owners, we are constantly creating “To Do” lists to run our daily operations.  And as you cross-off each task with exuberance and maybe a sense of short-lived accomplishment, the days will pass, the months fly by and the next thing you know…2010 is just around the corner.

 

How can we expect different results by doing the same things over and over again?  There are many variations of this phrase and chances are you’ve heard this before.  As irrational as this statement is, it lives and thrives in many businesses.

 

Ask yourself “What will I do different this year?”  What are some items that should make your “What Not To Do List”?

 

By not doing certain things or by not incorporating certain things in to your daily business operations, you can actually improve your business and hopefully your lifestyle as well.  Here are some examples.

 

1)  I will NOT work with belligerent customers and partners this year.

2)  I will NOT answer emails or phone calls during off-hours.

3)  I will NOT discipline or chastise an employee in public.

4)  I will NOT perform administrative duties which can be delegated.

5)  I will NOT ignore the phrase…Opportunity Cost.

6)  I will NOT ignore the phrase…Doing an unimportant thing well does not make it important. ( From The 4-Hour Work Week )

7)  I will NOT save a penny and lose a dollar.

8)  I will NOT neglect my family responsibilities for business.

9)  I will NOT forget why I started this business.

10) I will NOT live a deferred life.  Carpe Diem!

 

As all of your know, I am a die-hard capitalist.  Don’t worry.  I haven’t gone off the deep-end.  As my posts resume this year, my regular formula-based business strategies will return.  Having said that, there is nothing wrong with a little reflection.  Because of my unique job as a business consultant, I have a frontrow seat to observe the bahaviors and lives of many business owners.  And as a result, I want to invite all of my owner-readers to take a deep breath and consider the above.  As the saying goes…”Life is just too short.”

 

I leave you with the following short poem written by child psychologist, David L. Weatherford.

 

 

 

Have you ever watched kids

On a merry-go-round?

 

Or listened to the rain

Slapping on the ground?

 

Ever followed a butterfly’s erratic flight?

Or gazed at the sun into the fading night?

 

You better slow down.

Don’t dance so fast.

 

Time is short.

The music won’t last.

 

Do you run through each day

On the fly?

 

When you ask: How are you?

Do you hear the reply?

 

When the day is done,

do you lie in your bed

 

With the next hundred chores

Running through your head?

 

You better slow down.

Don’t dance so fast.

 

Time is short.

The music won’t last.

 

Ever told your child,

We’ll do it tomorrow?

 

And in your haste,

Not see his sorrow?

 

Ever lost touch,

Let a good friendship die

 

Cause you never had time

To call and say, “Hi”?

 

You better slow down.

Don’t dance too fast.

 

When you run so fast to get somewhere

You miss half the fun of getting there.

 

When you worry and hurry through your day,

It is like an unopened gift thrown away.

 

Life is not a race.

Do take it slower.

 

Hear the music.

Before the song is over.

 

 

~ David L. Weatherford