Marketing that Works and Makes Money
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Marketing that Works and Makes Money The redoubtable Peter Drucker once said: “Marketing and innovation are the two chief functions of business. You get paid for creating a customer, which is marketing. And you get paid for creating a new dimension of performance, which is innovation… Everything else is a cost center. Making Marketing Work
The First Way: Get More Customers
Marketing is about creating a customer. It often requires a depth of understanding about the customer’s desires that they themselves don’t even fully comprehend. And it means using innovation to continue to keep them satisfied by delivering new benefits and values. Companies spend a fortune trying to “market” to their customers. Everyone knows that a lot of marketing spending is wasted; the trick is to determine what parts are wasted and which parts work. Another brilliant marketing thinker and practitioner, Jay Abraham, has developed an answer for this age old question by applying the dual tools of simplicity and analysis. He suggests that through a simple process of focusing on the basics, testing various alternatives, and practicing “continuous improvement” one can optimize marketing significantly. He also avers that marketing can be the highest “return on investment” action that a company can possibly make. Simply put: better marketing equals better profits.
Companies place the majority of their marketing efforts in trying to attract more NEW customers. Perhaps it is our human nature that wants more people to like us or just to want to be bigger for the sake of size. The irony is that many times when we do manage to get more people to buy from us, we are either not ready, or the left hand does not know what the right hand is doing.
The Fundamental Law of Marketing As Jay Abraham likes to explain, there are only three ways to grow a business: 1) Increase the number of customers 2) Try to sell the customers more when they make a purchase 3) Increase the purchase frequency: that is, persuade the customers to buy more often That’s it. Think about it. What else can you do? Nothing. This is the immutable law of growing a business.
But will they pick up the phone? For example, have you ever read an ad, or seen a commercial, and finally thrown in the towel and decided you want something and picked up the phone and called the company? The phone continues to ring until you reach the irritatingly upbeat automated message: “…due to an unusually high volume of callers our hold time is approximately 5 minutes (or 10 minutes or whatever).” And this voice will cheerfully remind you periodically that the wait time is still long and that going to their website would be so much faster. They will even ask you to participate in a brief customer satisfaction survey after they have thoroughly annoyed you. Even if you are an extremely patient person, chances are that you will get pretty frustrated. You want to make a purchase and you would like to do it now. Most people hang up, we assume, after a few minutes of self-control and personal dialogue. Now, think about this. You are a large company, and you’ve spent millions of dollars, sometimes hundreds of millions, trying to get a customer to call you. And when they do finally call you aren’t ready for them! You have been paying for your marketing extravaganza by cutting costs, by eliminating those very people who answer the phones! (Hello Michael Dell!)
Marketing that Works and Makes Money This is also true of smaller companies. Last week, in fact, an acquaintance asked me to call him so we could set up a brainstorming session. So I dutifully called him, got his voice mail and left him a message. After a moment of reflection I decided it would be wiser to talk to his assistant; so I called again, listened to his message, and pressed #3 for his assistant. Sure enough, I got the assistant’s cheery message informing me of the day and date (absolutely accurate information) and then adding that while she was actually in the office, she unfortunately could not take my call and would I please leave a message? I did, and neer heard back from her. I proceeded to do this on three different days, calling both of them, getting the same happy and accurate messages on the phone with the right day of the week and the right date of the year, but I never did come into contact with a living human being. I had been responsive to what appeared to be an irresponsive company.
Seeing it through the eyes of the customer And then companies have rules. Sometimes they make sense; other times they allow a preclusion of sense. Years ago, I had just taken over running a well-known chocolate company in the Bay Area. I was listening to an old hand indignantly relaying a story about how this woman came to the plant the year before (perhaps with her kids in her car), and told him that she was thinking of starting a cookie company, but she only needed a small amount of chocolate to start up. Her requirement was below the minimum order (set why and by whom unknown) and the plant hand promptly turned her down. The story continues that the woman when to a competitor, who listened politely, agreed to sell her the smaller quantity of chocolate, and insisted on delivering it to her location as opposed to putting it in her car. Well, the lady was Debbie Fields of Mrs. Fields cookie fame. And guess where she bought her chocolate when she became rich and famous? Not from my company, for sure.
The Cardinal Rule When the customer calls, answer the phone. Be polite. Make it easy for them to do
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The Second Way: Sell more when they are buying The next way to increase sales is to sell the customer more of what they need or want. Figure out how they use your product and what else they need to complete the work, both before and after they buy your product. Take the Combo Meals on the McDonald’s menu, for instance. Does that ring a bell? It was not always that way. People would come in, buy a hamburger, and debate whether they needed something else. Well, most people needed something to drink but they didn’t always order it; same thing with the fries. That insight – of a complete meal – created great success for McDonald’s. Why not make it easy for your customer? And if it increases your sales too, it’s a win-win situation for certain. When you go to restaurants, do they ask you what you want to drink? And then offer tempting desserts at the end? I suspect most restaurants make more money on the drinks and dessert than they do on the meal itself. Perhaps you have also noticed that in many places it is quite hard to figure out the actual price of a drink. Could it be that restaurants have determined that people are not as price conscious when it comes to drinks and dessert (or perhaps they are too embarrassed)? A couple more examples: You go to Best Buy and are at the checkout counter when the fresh-faced clerk asks: “Would you like a warranty for that?” No, he did not think it up all by himself. Warranties may be the highest profit item in Best Buy’s entire line. Go onto any travel webiste: when you book a flight, they always ask whether you need a car, hotel room, or maybe some travel insurance? By placing all the relevant options and combinations together in one place, they are making the lives of their customers easier. And, by the way, it helps to grow their businesses, too.
Marketing that Works and Makes Money The Third Way: Increase the frequency of purchase For many products and services this has become second nature. Subscription services and lawn care, just to name two. Do the newspapers prefer selling you newspapers daily, or for a year, or for a lifetime? Take a guess. Many businesses ask for an email address so they can send their customers special discounts and offers, which then reminds the customer of things they need and the added bonus of a discount serves to entice them further.
In Conclusion There are only three ways to grow a business: get more customers, sell them more, and get them to buy more frequently. You should always start with the customer’s needs and realities. Analyze their desires and behaviors to the point that you can articulate it better than they can. But ask them to articulate it nonetheless; you just may learn something new. Always make it easy to do business with you; people want to feel like a person, not a number. Pick up the phone when it rings; do not rely on peppy answering machines to replace true human interaction. Always greet your customers with a smile. Making someone’s life easier isn’t just about providing them with a better product, rather it’s abut providing them with a better service to accompany a better product. And as you do this, watch your business grow. Significantly.
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