3 Simple Ways to Generate Extra Profits

There are three critical numbers in your business that affect your bottom line. Listen to find out how you are wasting money if your marketing isn’t focused on increasing at least one of these figures. And how working on all of them could skyrocket your business.

Why you should stop chasing new customers!

When I first talk to a client about their marketing, I have a few questions I always ask. The first is “What do you want to achieve from your marketing?”, almost without fail I get the same response: More customers!

While it is the obvious response, it isn’t strictly the truth.  When they ask for more customers, most businesses really want something else… More money! The assumption that more customers result in more money doesn’t always hold true.

The Problem

The problem with targeting more customers with your marketing, is that each customer costs money in the form of paperwork and staff time for customer service.  Marketing to new potential customers is also expensive.

The solution is better customers

Rather than aiming for more customers, how about focusing on creating more great customers.  A great customer is a heavy user of your products or services, they buy more, more often.  The never complain about your prices, and best of all they brag about your business to their friends and colleagues.

A great customer is valuable to your business from a profit perspective, but they also give you the best type of marketing you can get – word of mouth testimonials.  In short, they send you referrals!

Getting great customers

There are two things to keep in mind about great customers.  Firstly, you already have some great customers.  and secondly, your great customers think differently about your products or services than your regular customers.

In a cafe example:  To a regular customer, the cafe might be a place for an occasional pick-me-up, or a casual place to meet a client out of the office.  To a great customer, the cafe is their breakfast bar.

Get talking to the the great customers you already have.  Find out their thoughts on your products, what is it about them that make them great customers, and  why they choose you over your competitors.

Once you have an understanding of who your best customers are, and WHY they are great customers. You can use the information to:

  1. Encourage your standard customers to become Great customers
  2. Target your marketing at those people who are most likely to become great customers

Rather than aiming to get just more customers, your ultimate goal should be to get more GREAT customers.

Last Question:

What do you offer to your best customers to let them know how much you value them?  Do they know they are a VIP to your business?

A great illustration of the importance of first impressions

I am always searching and reading as much as I can about marketing and branding to make sure we can keep up with the newest and best techniques people are coming up with.

Anyway, I stumbled on this post the other day.  It is a short video that really gets across the point I made the other day in my paint the fence post, about the importance of a first impression.

Head over here now and check out this post… the video is only about a minute long, and totally worth a look:

First Mental Image should draw you in! (video version)

Have you thanked your customers lately?

Your most important customers are the ones you already have.  Businesses often spend thousands of dollars per year marketing and advertising to attract new customers while ignoring, or taking for granted their current customers.

Existing customers have already chosen to do business with you, the chances they will do again is high if you look after them.

Sending your current customers something as simple as a thank you card could be the best value marketing you could do.  Of course you could also give them a small gift or make them a VIP offer to encourage them back to see you.

I know one business that sends one handwritten thank you card to a different customer everyday.  It is a habit that pays dividends.

To employ this idea, you need to know who your customers are.  Do you have a list of customer contacts?  If you don’t, you should – start building one today!

Marketing lessons from the wine industry

How do you stand out from all the wine labels

How do you stand out from all these wine labels

Here in Marlborough it is hard to escape the wine industry, it is a huge part of our regional economy.

I was in the supermarket the other day and run into a friend of mine who has a reasonably young wine label, and it got me thinking…

With supermarket shelves lined with hundreds of brands, how do you make your bottle of wine stand out and reach your customers?

One simple marketing strategy used for years by wineries, big and small, is offering free tastings of their product.   How often have you been asked if you would you like to try a glass of wine in the supermarket?

Here’s why this is a great way to market your brand of wine:

  1. They go to where the customers are – customers are already in the supermarket.  If they are going to buy a bottle of wine, who do they see?  If they like the wine, they can grab a bottle and buy it immediately.
  2. The customer is being offered something for free, no obligation.  Lets be honest, we all like free stuff.
  3. People are creatures of habit – A free tasting is an easy way to try something new.
  4. It takes away the customers fear of buying a bottle of wine and hating it.  They already know what it tastes like before parting with their hard earned cash.

I think it works even better for smaller players in the market.  It gives them a chance to put a face to the brand and start a conversation with the customers.  They can tell a story about their wine and relate it to the customer easier than a sales rep from a large company.

How can you use this idea in your business?

  • What can you offer potential customers for free? Remember, wineries only give away a small taste, not whole bottles of wine.  Can you offer a taste of your product or service?
  • Is there a place your products or services are frequently purchased or used?  Can you have a presence there to meet them?
  • What fears do customers have about purchasing your products or services?  Can you offer a try before you buy deal or a satisfaction guarantee?

photo credit: rick

Love is blind

You have heard the phrase “love is blind”… Often a flippant remark when we notice a seemingly mismatched couple. But often this cliché runs true. When we are in love, we are more forgiving of the little problems and imperfections. In fact we can come to value these imperfections and personality quirks and become some of the reason we love so much.

When people love a brand, they will forgive that a product is a little more expensive, or that they have to go out of their way to find it. They will refuse to admit another brand can be as good, let alone better. They’ll purchase the product(s) over and over again, and they’ll rave about it to friends and colleagues. A great example is Karen recently professing her love for her new Apple Mac.

On a recent blog post, Seth Godin writes about Love and what he considers its opposite… Annoying. Check out Seth’s full post here: Love (and Annoying). He gives some great examples of companies and products that aim to be loved by their customers and others that aim to be less annoying.

The ultimate goal in branding or designing a product is to be loved by our customers. While we would all love to have a brand that is universally loved by everyone, it is not always possible. Seth suggests, “If you can’t do that [be loved], perhaps you can make your product or service less annoying”.

The problem with love is that not everyone loves alike, and those who don’t love your brand will likely find you annoying. If your business model will work with fewer, but more loyal customers, then love maybe you should try to create a brand for people to love. But if you need more customers, then spend your effort making sure you are less annoying.

Targeting your brand

First, your brand won’t appeal to everybody.  Don’t worry this is a good thing;  it shouldn’t appeal to everyone, because not everyone will want to buy your products or services.  An 18-year-old boy isn’t going to buy a crotchet kit, and a 65 year old couple are highly unlikely to purchase a new wakeboard.  With this in mind, ANY time, effort or money spent marketing to these groups is completely wasted.

To increase the effectiveness of your brand and all related advertising and marketing, you need to know who your most likely customers are.  Lets be honest, you already know this… it isn’t rocket science.  It is easy to slip into the “I’ll take money from anyone” mindset (and so you should, but you shouldn’t market to them), or consider it too hard to define your core customers; I’ve been there myself.  But it is CRITICAL to the success of your brand.

Think about it.  If I told you, that you could have all the profits from any nappies you could sell to one hundred people, would you ask the first hundred people you meet? or would you do better asking the next hundred people pushing a stroller?

The more knowledge you have of who your customers are, the easier it is to target them with your branding and marketing.  You can draw better conclusions as to what they want to buy, and why.  What their likes and dislikes are, and how they want themselves to be perceived.  It also gives you an insight into what radio stations they listen to, and what newspapers and magazines they read.

Demographic information you need to know about your customers:

·        Age (range)

·        Employment – Are they management, professional, or owner

·        Location – City, town, region

·        Gender

·        Education

·        Occupation

·        Marital status

·        Ethnicity

·        Income – total household income. Can they afford your products or services

·        Family status – do they have children? What age and stage?

 

If you supply products or services to businesses, you can also collate demographic information for the businesses you deal with.  Such as:

·        Industry

·        Size of business (sales, no. employees)

·        Type of business (manufacturer, retailer, primary production)

·        Location

·        Geographic scope of the business (regional, national, international)

 

So how do you get this demographic information for your business?

 

The best way to gather demographic information is through using market research companies.  However, these can be expensive.

It is possible to do your own research: it is relatively inexpensive to run your own phone survey, or observation of your customers.  My favourite method is to ask your customers if they would be willing to complete a quick questionnaire during the purchase transaction.  You could even offer an incentive such as a prize draw, small discount (or better a bonus).

How does your customer feel?

The local Smith City department store here in Marlborough recently held celebrations for one year in their ‘new’ premises.  They turned it into a great event with amazing bargains to draw in the crowds, a festive atmosphere with barbeque, balloons, and media coverage with two radio stations present.  All in all they did a great job of turning an occasion into a PR event.

One of the bargains was a baby carry pack at a massive discount of close to 70%.  We have a wee man, and love the outdoors, so sent Nana off early to grab us a pack.  The marketing had worked so well that there was a substantial queue of people and baby strollers outside the shop and as soon as the doors opened, the shop was flooded with customers.  Only having 10 packs in stock, they sold out in less than 3 minutes…  As the lucky 10 people happily carried their bargain packs home, many more customers left disappointed and annoyed that they had wasted their time, effort and in some cases money (I know at least two people who took time off work).  This situation left me wondering –

“Do you really want disappointed customers?”

With such limited stock, it was guaranteed that some people would miss out.  Smith City set themselves up to disappoint.

How your customers FEEL about your business, affects your Brand.  In fact, I would go so far as to say, that how people feel about your business IS your Brand.

What’s your opinion?

Your brand is more than just a name and logo

Your brand is the sum of every interaction and communication your customers have with your business.

Too often I see people who name their business, get a logo and a business card, thinking they have a brand.  When really all they have is a name, logo and a business card. Obviously these are the important visual elements in a brand. However they need to fit into a broader framework of communication with your target audience.

When you need to buy business shoes, which shop do you go to first?  Why do you think of these shops?  Do they have the cheapest shoes, or the best quality?  Are the salespeople friendly, professional, knowledgeable?  Do they run a loyalty scheme?  Have you heard good things about them from others?  Maybe a store is running a sale?

All of the above factors, along with many more, are aspects of the shoe stores’ brand.  Often, as customers we are not even aware of these individual factors and we instead assimilate them into a single view of the business.  We then subconsciously use this view to make our shopping and buying decisions.

When branding our own business, we need to ensure how all of these factors express our brand.