Small Business Marketing Guide to Up Your Profits in a Down Economy

Let’s continue with profit-boosting ideas that will increase your profits without exhausting your marketing budget (I’m assuming that you are budgeting for marketing and not just hoping dollars will become available). I’m going to focus on two keywords and they are two words that can dramatically change the way you look at your business – Leverage and Systematize.

Think leverage – If there is a client in your business and they are buying from you, what can you do to leverage this contact? Here are some ideas:

• Cross-sell or up-sell to increase the value of the transaction
• Get their name, address, email address and record their buying preferences so you can continue marketing to them with coupons, newsletters and other tactics that encourage additional purchases.
• Ask them for referrals (learn how to ask for referrals!)

Give them coded coupons to hand out to their friends. When they are redeemed, send the client a thank you gift.

• Ask what business they are in and see if there are products or services you offer that the business could use.
• Start a platinum membership club for your key clients. Sell memberships that entitle them to special offers and privileges.
• Find out what other businesses they frequent and ask for an introduction to the business owner to explore joint ventures and strategic alliances with them.
• Send them a thank you note for their purchase and include a coupon for a discount on their next purchase if they return within the next month.

Pretty much every item listed is leveraging a relationship with a client. Do the same with your prospects and suppliers. You want to leverage every contact to see not only what additional profit you can gain but what additional service or benefit you can bring to your clients.

Small Business Marketing to Up Your Profits in a Down Economy

The most powerful, simplest and inexpensive marketing strategies to bring your business a flood of sales and waves of profits is the joint venture (JV) or strategic alliance. Essentially, you are leveraging the relationships another business has with their customers to build your own business. They work as well in both online and off line and can be very simple or very complex, multi-million dollar deals.

Your starting point is to identify non-competing businesses that have a client profile similar to yours. Approach the owner with a letter or phone call and let them you have a unique idea that can generate a lot of new clients. There are a couple of things you can try.

One is to offer to pay for a mailing to their clients recommending your service or product. Include a special offer, with a deadline for redeeming, that is unique to their clients. I’ve found that creating a coupon on which the offer is printed improves response.

Some businesses you approach will express concern about the confidentiality of their list. If so, offer to have them send it directly to their list themselves. You will want to write the sales letter or coupon yourself but allow them final approval on the copy.

Another tactic is to create a mailer on which you both print an offer and mail it to your combined client lists and share all expenses equally.

I believe it is very important to conduct due diligence and to take the time to get to know your potential business partner as well as the quality of their products and services. If you plan on recommending somebody to your valued clients, be sure they will meet your standards and expectations.

Typically, only about three of ten business owners will wish to pursue a joint venture so you’ll need to make several calls but it will be well worth the effort. In my opinion, the JV is about the most powerful marketing strategy any business, large or or small can implement.

Up your profits in a down economy – How to open a cash windfall

Have you ever “mined” your client list? If you have a list of satisfied clients, an email list, a list of vendors and a personal network, you are probably sitting on a gold mine from which you can “extract” a cash windfall.

In my previous couple of posts, I referenced the importance of regularly “touching” your clients. If you’ve been doing that (or even if you haven’t done so regularly), you’ve been building and cultivating a relationship with them since they have been buying from you. You can leverage this relationship for immediate cash.

How do you go about doing this? Sit down in front of your computer and write a letter to your best clients and tell them about your situation, that you need to raise cash to help build and improve your company. In return for their support, you will give them special treatment, special discounts and bonuses just for them.

This is a very powerful technique that leverages one of your most important Hidden Marketing Assets, the relationships you have cultivated over the years. Will it work for you? Only testing will tell but the odds are in your favor because your clients trust you and people enjoy helping people they trust and have given them good service

Now, if you really want to leverage this concept, start thinking about whom you can create a joint venture with and make a special offer to their client and prospect list. I’m not talking about the BS internet joint ventures where a guru gets other gurus to promote their latest and greatest products, without seeing it or having any idea of what it does. You know what I mean. You get the same email from twenty people saying their “good friend” has the most amazing money making system in the world

I’m talking about a genuine relationship with a business owner you know and trust. Somebody who has the same beliefs about quality and service that you do. I’ll go more into structuring joint ventures in another post but start thinking of how you can approach clients and prospects with a very special offer.

Up your profits in a down economy – Increase client value

In this order, these are the easiest people to sell to:

1. An existing client
2. A past client
3. A referred or endorsed client
4. A cold prospect

This list is an established fact. Even knowing this, where do the vast majority of companies spend the majority of their marketing dollars and effort? On number 4, the cold prospect. Nearly every client or prospect I speak with spends little, if any of their marketing dollars strengthening their relationship with their existing clients.

The thing is, most of them realize they should be keeping in touch with customers but still do nothing about it. Very few companies even have any process or method of getting basic contact information like name, address, phone number, email address or a list of the products purchased by their clients. According to a study conducted by the Direct Marketing Association, for every month that passes without your contacting your clients, there’s a 10% reduction in loyalty to your business.

For about $10 to $15 per client per year, nearly any business can build a customer contact program that will dramatically increase their sales and profits at a fraction of cost of obtaining a new client. Ideally, you will have 12 to 14 contacts per year. Rather than looking at this as an expense, look upon it as an investment in the lifetime value of your clients.

The key to success in your client contact strategy is to include an offer, a coupon, a discount or other reason for your clients to contact you and purchase additional products or services from you.

In my next post, I’ll list some of my favorite client contact strategies and tactics you can use to increase your profits.

Till then…
Dedicated to multiplying your sales!

Up your profits in a down economy – Post 3

In my last post, I wrote about the importance of improving your selling skills. Without a doubt, it is the simplest way to dramatically increase the value of each sale.

Even if you don’t take the time to go through a professional selling course or book, there are some things you can do to increase the average transaction value.

• Start by identifying your most popular selling products or those that are easiest to sell.
• Select one or more products or services that compliment these products.
• Create “bundles” with special package pricing that applies if the client buys the extra product at the same time as the initial purchase.
• Create a sales script and rehearse the words that you will use to up-sell to a client. Say you own a pet store and a client just bought a training leash for their new dog. You say, “If you are using this for training, I recommend you also get the bookGood Owners, Great Dogs. I think it’s one of the best training books ever written. If you get the book today with the training leash, I can discount the book 10%.”
• It’s that easy. The key is to know what extra value you can bring to your client, believe in the value of what you are offering and ask the client to buy it.

The key is to get used to asking. Will it work every time? No, but it will only work if you ask! Whatever you sell, it is very likely you can add value with additional products. Since you’ve already spent the money to get the client in front of you, you owe it to yourself and the client to insure they have everything they need!

Up your profits in a down economy – Increase profit per transaction

One of the simplest tactics for increasing your profits is to pay attention to the client who is directly in front of you. It doesn’t matter if you have the person on the phone, in your store, in your restaurant or on your web page, it is fairly simple to get the client to buy more.

Most businesses leave an absolute fortune on the table because they simply ring up the sale that is in front of them and make absolutely no effort to add to the transaction. To put things in perspective, think of the additional profits McDonald’s makes every year because they ask the question, “Would you like fries and a Coke with your meal?” Most of us could easily retire if we had that money!

The easiest person to sell to is an existing client. What you need to do is to train yourself and your staff to ask/recommend to the client to buy more. Too many people feel they are being pushy but that’s not the case. Imagine yourself in a clothing store. If a salesperson suggests a nice shirt to go along with the slacks you just bought, do you feel they are being pushy? What about the waitress who encourages you to get dessert? Do you think she is being pushy? I doubt it!

The bottom line is that it comes down to selling skills and having an attitude of serving your customer. If you have a good product or service, offering it to your client is a way to serve them.

Have you ever read any sales books or bought any sales programs? It is one of the strongest recommendations I have for you. It’s made a major difference in my income over the years and can do the same for you. Spend some time in the bookstore, online or in the library. Buy several programs and develop your own style around the proven strategies and tactics of the sales masters.

Click on the resources tab at the top of the blog and see who I recommend. Become a student of sales and apply what you learn.

Unique Selling Proposition Part 3

In this video, I continue to discuss the Unique Selling Proposition and get into the details of how to use the information you’ve gathered in the previous steps and begin writing and refining your million dollar USP!

Increase your profits in a down economy- Part 2

Where do you want to spend your marketing dollars in a “down economy?”  In my last post, I wrote about how the media plays a big role in the perception of the economy.  If you believe them, the entire world is now broke and living in boxes underneath highway overpasses.

Business owners start to believe that there are no longer clients willing to buy from them and they enter a hibernation mode, hoping they will make enough sales to survive.

Have you been to a department or grocery store lately?  If so, you may have seen what I have been seen.  People are buying things.  Have you been to a restaurant lately?  Did you notice that people were buying meals? Have you noticed a dramatic decrease in rush-hour traffic because nobody has a job any more?

Hey, I believe there are some serious problems with the economy but the fact of the matter is that people are still making and spending money. The wise business is not retreating. Instead, they’re spending marketing dollars wisely. They are throwing useless “brand/image” advertising out the door. They are demanding accountability from agencies and others selling them media.

The way I look at it, if your marketing isn’t delivering a measurable return, either get rid of it or figure out how to measure it. There are companies out there that do detailed ROI projections for capital investments but often spend the same amount of money on marketing with no strategy to measure return.

The bottom line is that this is the worst time to cut back on your marketing. Your competition is probably doing it so why not take advantage of the situation to strengthen your presence? When things turn around, there will be a lot of your competitors who may be great buyout targets.

You also need to spend some serious time strengthening your relationships with your clients. Be sure you are maximizing revenue from each transaction. Be sure your sales reps are well-trained in selling skills and product knowledge. Be sure your service staff knows how to up-sell and cross-sell.

Finally, quit listening to the media and chart your own future.

Attract premium and profitable clients with a powerful Unique Selling Proposition

Why should I buy from you?  A simple question but one that few business owners are able to answer.  They say, “We have good service,” or “We’ve been in business for 50 years.”

To the we have good service company, I say, “Well, you better have good service or I’ll never be back.”  Good service is expected, it’s not a differentiator.  If you’ve been in business for 50 years, that may mean nothing to most people.  Who cares how long you’ve been around?  TWA was one of the best known names in the airline industry.  They gave good service and were in business a long time.  They are now a nostalgic memory.

Your Unique Selling Proposition (USP) answers the question, “Why should I buy from you vs. your competition or do nothing at all?”  If you can’t answer that question, then you are hoping your prospect will figure it out on their own and will hopefully decide you are worth the investment.

Creating a USP is not as dificult as it may seem, if you follow a process and approach it as a stategic project that answers the why should I buy from you with a compelling reason.  If you approach this as a project to create a clever slogan for an ad, you are handicapping yourself.  In a series of videos, I am going to walk you through the process of creating a powerful and compelling Unique Selling Proposition.

I hope that you find these videos helpful.  At any time, feel free to contact me, Paul Flood, to discuss or review your USP.

Increase your profits in a recession!

I’m going to be writing a series of posts about small business strategies to profit during a recession.

First of all, I do believe there are some real serious economic challenges, particularly for large companies or even smaller companies who may be having some challenges obtaining credit.  I also believe that there are a lot more opportunities than the media would have us all believe.

Case in point – During a recent segment on Good Morning America, Diane Sawyer was interviewing an Avon distributor.  She acted astonished that women were buying cosmetics in such a tough economy.  About half of the people I know are women and I can’t tihink of a single one who quit applying makeup every day.  The absurdity of Ms. Sawyer’s comment was unbelievable!

Head to Walgreens, Krogers, Wal-Mart, Macy’s or any other store and see if they have cordoned off the cosmetics department because the economy is bad!

One thing I really shudder at is when a business owner tells me they are cutting back on their marketing because of the economy.  If they are cutting back, then their marketing was likely ineffective image advertising, they have no mechanism for tracking results or really don’t know what to do.

Don’t cut back!  Instead, sharpen your approach.  Understand your market, the media that will reach them and the message that you are sending.  Track your results, improve what is working and toss what isn’t.  Make every dollar you invest in marketing bring you prospects or sales.

Try multiple approaches and see what works best for you.  You won’t know what will work best unless you test it.  Be bold and different from your competition.  Stand apart from the crowd and provide incredible service.  Create a loyal fan base who would never consider leaving you.  Give them a reason to buy more from you and to buy more frequently.

In future posts, I’ll be giving you strategies and tactics that will likely deliver the greatest return for your business.   If there is something that works particularly well for you, share it with me so we can help each other gropw and succeed

Dedicated to multiplying your sales!

Paul

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