This is the tenth post in the series of The Ten Priorities: Laying the Foundations for a Great Business and Life. The tenth Priority is about Managing the marketing. The introduction to this series on The Ten Priorities is here.
The second rule of Seth Godin is to make sure lots of people know about your great product or service.
It may seem obvious. No matter how great your products, your people, your systems, your visions and your plans are, if nobody knows how great they, there will be no business.
Many business owners will go out of their way to build a great product, but forget the second Rule. (BTW, the inverse is also true, more about the two different types of entrepreneurs here)
But both rules are equally important.
A business owner who wants to build a great business must learn that in business:
Marketing is everything, and everything is marketing.
A great business owner asks himself about the marketing dimension of every aspect of the business. Marketing is as much about the way the business goes about collecting its debts, or about the way people answer the telephones, or about its product warranty, as it is about the Facebook advertising campaign it’s running.
In fact, it can be said, that any activity in the business that does not have a marketing dimension to it, is a waste and should be stopped immediately. (more about the basics of marketing here)
When you learn to ask yourself about the marketing aspect to every decision you make, every system you develop and every action you take, every day, your business will flourish… I promise you.
Now that you’ve finished Ten Priorities, find out more about yourself and take “The Entrepreneur Type Survey”
How to grow your business is the most enduring of The 7 Big Questions. All of us business owners have felt frustrated at some stage in our journey to building a Beautiful Business The business feels stuck at one level and we are not sure how to get it to the next level.
So many misunderstandings and myths about business growth:
I have written about the general topic of business growth in many different places. I think there are a number of misunderstandings about business growth that are not helping us, as business owners, to feel better about ourselves. The first article is about that (and you can also read about the misunderstandings about growth in my book: The Ten Truths for Making Business Fun):
I believe that to grow a Beautiful Business that Stands the Test of Time you must be able to answer the question: Why does your business exist and why would anybody care? Most business owners can’t answer that question succinctly and powerfully. That’s bad, because if you don’t know why your business exists, your customers certainly won’t be able to tell, and then all it comes down to is price. Competing on price is a dog’s game, unless you’re Aldi, where price is your Purpose. The second reason you need to be able to answer the question clearly is that if you can’t, you will never master the greatest skill of effective business owners, namely the ability to say “NO”.
We’ve all heard that to grow your business you must start with Goal setting. But effective Goal setting is more complicated than you might think. Most Goals we set for ourselves and for our businesses are at best ineffective and at worst actually hinder our progress. Goals are often arbitrary, unrealistic, and unrelated to what really matters in our lives. A Goal to make $2 million revenue is an arbitrary and meaningless number, why $2 million? why not $1,956,384.13, or $2,163,927.46 for example? And so what when you reach the goal? Will you be better off somehow? What if you fall short? By $100, or by $1,000, or by $100,000? Does that mean you are a failure? Goal setting really makes a difference, as long as you understand that Goals are like a compass, they provide a direction on your journey, they are not the destination.
Marketing is about creating opportunities to sell your stuff. As such, I fervently believe that:
Marketing is everything and everything is marketing
And it is. To grow your business you have to look at every aspect of your business. Marketing is about advertising campaigns, and social media and designing your logo and your website, but it’s also about how you answer the telephone, about your pricing policies, about ensuring that your customers are happy with what you sell them. It’s about how you dress and about how you present your quotes and about your Public Relations strategies and about your warranty return policies. One of the greatest marketing strategies is a relentless focus on quality in everything the business does, in order to “Create Raving Fans”, because if your customers are all Raving Fans, they will actually do your marketing for you.
I don’t mean to imply that online marketing is somehow something different from all other forms of marketing, it isn’t. But it is useful to pay special attention to online engagement and marketing to build and grow your business, because it has become such an important aspect of any marketing strategy. Whether your business is a cafe or a building company or a law practice, or it imports widgets or makes whatsits, you can not ignore a bunch of different forms of online marketing. Email marketing, content marketing, Search Engine Optimisation, Search Engine Marketing, Social Media Engagement, Social Media Marketing, online PR, online reputation management (The ubiquitous star ratings), video marketing. The list is near endless and constantly changing.
You could easily argue (and I have in one of the articles I refer to below), that the principles of marketing haven’t changed, we’ve just got a bunch of new tools to do it with. And at one level that’s true, people still want to get to know, like and trust you before they will do business with you. But on another level things have changed drastically. Ten years ago, you’d give someone a business card with your web address on it and they would immediately want to know if you also had a bricks and mortar store. These days they want to know you’ve got a high functioning web presence and that you’ve got a presence on Facebook and on Google local and ideally a bunch of 5 start ratings on Yelp and Trip Adviser. Whether or not you have a bricks and mortar presence, simply doesn’t matter anymore. Online engagement in all forms must be part of your marketing strategies or you will not be taken seriously.
That’s a quote I saw hanging on the wall at a big office once, many years ago. And it’s true. No business growth, no business, without sales. No matter how great your product is, how beautiful your logo is, how smart your website is, or how wonderful your employee conditions are, if you’re not selling, the business will cease to exist.
Sales is often seen as a subset of marketing, but I’m giving it it’s own section here, because I think of marketing as getting the customers to your door and sales as actually getting them to hand over money. Lead generation v lead conversion. Sales is about skill and it’s about mindset and systems and above all, it’s about making it easy for people. And this last word is the key to the whole shebang. It’s always about people. The old saying is:
People do business with people they know like and trust
You must always remember it’s about people first and foremost and in small business especially it’s about people in both directions: People do business with people. Your whole approach to sales, especially in small business, all aspects of it must be built on a people to people philosophy.
A business without a Plan achieves everything in it
Nothing in other words.
Your business growth depends on planning. No human endeavour ever amounted to anything without a plan. Yet planning is guessing. It can never be anything more than guessing, because we can not know the future. So if planning is guessing, why does it matter so much and how can we do it so it works? There are two important answers to those questions:
There are two important answers to those questions:
1) You must understand that there are two entirely different types of business plans: Internal Plans, and External Plans. External plans are designed to impress others about your business and form part of the documentation to obtain a loan or other form of funding or make a proposal to a third party of some sort.
Internal Plans are documents designed to help the business focus. They are combined with meaningful goals (see above) and they help people in their day to day decision making processes. Internal and external plans have different functions and are presented quite differently as well.
2) Planning is a verb. It’s not static, it’s an activity that never stops. As soon as one plan is created, we start again. John Lennon said: Life’s what happens when we’re making other plans. Planning is like that, we make a bunch of assumptions and plan our actions accordingly. Then we go ahead and check reality as it unfolds and make changes to our plans to suit the new realities, every day, every week, every month and every year. Business Plans that work, that make a difference, are living documents.
Customer service is also a subset of marketing of course, if done well it leads to more business from those customers, and as I said above, everything is marketing and marketing is everything, but it’s worth mentioning separately, because of the concept of Raving Fans. Ken Blanchard wrote a little book that said it best in the title: Create Raving Fans and have your customers do your marketing for you. It’s a great little book and there’s a link below to get yourself a copy of it.
The principle of Ken Blanchard’s book is that your business should always be working to do one better for your customers than they expect. If you do so, your customers will become your advocates (Raving Fans) and advocates will go out of their way to help your business grow. They will talk to their friends about you, they will drag their colleagues to your door. They will defend your business against the competition and best of all, they won’t quibble about price. If your business focuses on turning it’s customers into Raving Fans, you will be able to slash your marketing budget in half, over time, for a better result.
Grow your business with systems and quality improvement
My clients often ask me to help them grow their business, and I often tell them to stop worrying about that. Getting more customers is actually the easy part. The hard part of business is:
To deliver what you say you will
By the time you say you will
For the price you say you will
At the quality you say you will…
With a smile
If you can do that all the time, the customers will come flocking to your door and you won’t have to spend much money on marketing (for one thing because you’ll be creating Raving Fans, see the previous topic). And right now, you may well be doing all those things, with a smile, but the trick is to be able to keep doing that as the business starts to grow.
I can’t tell you how many businesses I have seen struggle and fail in my years in business who couldn’t maintain their product or service quality and dependability and price, at scale. Once the business starts to grow and you, yourself, are no longer in charge of every step in the process, things start going wrong. Quality becomes inconsistent, delivery times become unreliable, prices go up or profitability suffers and your smile starts to disappear. Once the rot sets in like that, your reputation starts to suffer and customers start to look elsewhere.
There are only two answers to this dilemma: Either, don’t grow, stay small, learn to say NO and say it all the time… Or systematise. Developing systems for all aspects of the operation is the only answer. Systems for how the phone is answered, systems for estimating, systems for quality checking, systems for calendar management, systems for inventory management, systems for callbacks and warranty repairs. Systems for marketing, systems for hiring and firing etc etc. Above all, systems allow you to create Continuous Improvement Loops into your organisation. And continuous improvement is the Holy Grail of business. It’s what made companies like Toyota great.
Inventory management is a big specialised topic, and it’s really a subset of the systems section above. There are whole management libraries written about the various philosophical approaches to managing stock when building and growing a Great business that Stands the Test of Time. My earliest lessons of inventory management came from the owner of a big hardware store I dealt with a lot in my days as a builder, Colin. One of the reasons I bought so much of my material from Colin was that he always had everything in stock. Colin clearly knew what it took to create business growth, because his business was booming.
I asked Colin once if keeping such high stock levels of everything a builder such as myself might need from time to time was economical for him. I imagined that it was a very expensive way to run a business, having all that money tied up in timber and hardware and bits and bobs. His answer was:
If I don’t stock it I can’t sell it.
I have often thought about that statement in the years since, now that most operations run on the principle of “just in time”. Supermarkets have made an art form of stocking just enough and not a jar more than required, to minimise shelf apace and inventory cost.
I don’t know what the answer is, but I know that Colin got all my business for 20 years and most Sydney builders had an account with him, because everything we needed was always ready to be picked up.
Grow your business with hiring, firing and engaging people
Michael Gerber in his famous book “The E-Myth” wrote that it’s impossible to manage people and hence great businesses focus on systems, and manage those instead. And that’s certainly what grew McDonalds into the enormous business it is today, no argument. And as I’ve written elsewhere before, if you set out to make as much money as possible from selling restaurant food, it is undeniably the case that the McDonald’s model is the one to emulate. But, I can’t tell you how happy I am that not everyone in the restaurant industry wants to build McDonalds, because the world (and my palate) would be the poorer. The same philosophy can be applied to any industry.
If you’d like to build and grow a unique business, a business with an individual character, you’re going to have to manage people. You’re going to have to get good at putting the right people on the bus, sitting in the right seats, facing in the right direction and also know which people to get off the bus. If you don’t learn how to find and keep the right people and get them to do great work, your business will always struggle.
That means developing hiring policies, being prepared to hire people who might be better than you are at certain things, learning how to do great interviews, implementing induction and development training programs. It means learning how to coach your people, encourage them and hold them accountable. And it means learning about effective delegating. It means doing the HR admin and compliance effectively, writing job descriptions and doing performance reviews. It means learning what it takes to be a leader and it means being prepared to take the tough decisions when required, and take them quickly and respectfully.
To build and grow a Great business that Stands the Test of Time, you can’t afford to be left behind. The pace of change and innovation is relentless and what was ok even a few years ago is no longer ok now. Not long ago it was still fine for a cafe to have a sign saying “cash only”, but in 2018, you’ll lose a lot of business if you don’t accept cards in payment. Even in a business as simple as mine, people expect me to be able to accept online bookings. Cloud computing combined with smart phone technology and advanced GPS systems mean that customers now expect to be informed that their plumber is on its way and can be expected to pull up in front of their house in 13 minutes.
You don’t need to be Uber or AirBandB to implement new technology and come up with new ways of doing business. I just bought a house in a different state of Australia. The real estate agent gave me a private showing of the house via Skype. I engaged the conveyancer, the building inspector and a surveyor all without setting a foot in the house or the state.
A client of mine with a creative marketing agency has a team of designers and copywriters and marketing assistants all over the world and she rarely even meets her clients face to face. Another client with a small supermarket chain has technology in his stores that allow him to see what’s going on in any part of any store and to get live access to each of the store’s Point of Sale systems. He’s also just implement a bunch of tablet screens in his stores allowing people to find dinner recipes incorporating the fresh vegetables he has on special.
And all this stuff is only the beginning. It won’t be long before artificial intelligence is integrated in doctor’s surgeries and lawyer’s offices, and copywriting agencies. If you think that technology and innovation isn’t going to have a massive impact on the way you do business and how to create business growth, you are kidding yourself.
How to avoid the Spray-and-Pray approach to your marketing strategy
I had a interesting experience at a networking and business building event a few days ago. We met over breakfast and there were various activities designed to get to know each other and to support each other in the development of our businesses.
One of the exercises we did was a group hot seat, where one of our fellow business owners presented himself and his business to the group and asked for help with his greatest challenges.
The business owner in question, let’s call him Adam, told us about all the amazing projects he’s been involved in and how smart the solutions were that he implemented for his clients.
But Adam also shared that he sometimes found it difficult to find new clients.
So we asked him who his ideal clients are, how we would recognise them if we tripped over them and how we could introduce him to them effectively.
Designing solutions for the challenges
In response, Adam, told us he’s worked with government departments, global machinery manufacturers as well as dog kennels and everything in between. He told us how he sits down with business owners and gets to really understand their businesses and challenges, designs solutions to resolve those challenges and implements the solutions for them.
All very well of course, but it didn’t help us much in our quest to support Adam. Most service based businesses do exactly that, they find out about the challenges a client has and then they offer a solution. But we never really got any further with Adam. Every time we asked him to get more specific he gave us more details of the wide range and varied types of clients he’d worked with. Although Adam left us impressed with his experience, his knowledge, and his expertise, at the end of the 15 minute hotseat, the group was no closer to understanding how we could help him find more new clients.
How can we help you?
In the end we left Adam to ponder the following question:
“Let’s say someone wanted to help you, really help you, and they were prepared to set an hour aside today, to do exactly that. Further more, let’s say that person had database of 6000 direct connections in LinkedIn. All business owners, largely in Australia and most of them in Sydney. Amongst such a database, it seems likely for there to be 5 or 10 people who are actual prospects for Adam.
Obviously, it’s not possible for such a person, to send a direct email to all 6000 people in a kind of “spray and pray” marketing outreach. So the question we left Adam to ponder was: How can such a person go about identifying those 5 to 10 perfect introductions for you from amongst the database of 6000?
Because you see, Adam really struggled to answer that question. Adam couldn’t tell us how to filter out 5 or 10 people in such a database of LinkedIn connections.
And I think most of us have that challenge. We don’t actually know how to identify our prospects.
Who are my prospects?
I find it difficult in my own business as well sometimes. I’ve thought about it a lot and often, and the best I can do is this:
I’m looking to connect with business owners
That are in design (Architecture, Interior design, Graphic design) technical services (IT, Communications, Software and Web development) or trades (Building trades, Motor trades, Hospitality trades)
With between 3 and 20 employees
And that have operated the business for 2+ years
Confronted with the same question we left Adam to ponder, using the above criteria I could narrow the search down a little and have a slightly more focused list, but there’s probably still a lot more than a 100 people in that database of 6000 that meet all the criteria.
A direct introduction strategy is very powerful but it can only work with a very limited number of people.
So why does it matter?
Well, I do want to help Adam, he’s a good guy and very good at what he does, and as it happens I do have a database of 6000 direct connections, but I simply don’t know how to help him.
And what’s more, because Adam isn’t clear on who his clients are, he can’t craft a clear marketing message himself either and he can’t focus his own messages on the right people.
If Adam isn’t clear, his prospects won’t be either.
Most of us face that dilemma.
For me, it’s clear that small building and trades contractors, builders, electricians, plumbers, painters, carpenters, architects and engineers are absolutely the people I should to be talking to. Those kinds of people are right in my sweet spot. So if you know any of those, I’d love you to make an introduction, and I’ll send them my weekly tips.
But how would you answer the question we asked Adam to ponder?
This is a guest post about micro influence marketing by Philip Piletic, more about Phillip at the end of this article
Why you (and I) may be more influential than the Kardashians
Hiring actors and actresses, singers and dancers, and everyone in-between is nothing new to the world of marketing. Since the advent of modern day marketing, advertisers have long seen the potential in using human billboards as a way to peddle their merchandise. Though times and technology have changed, using influencers as a method for pushing brands has not.
In an article published by Forbes, Tim Ward, a successful entrepreneur, and author, wrote that the influence trend is not showing signs of slowing down anytime soon – we are just getting started, as a matter of fact. So what has changed since the good old days when cigarette brand Kodas began introducing baseball cards of famous players with their pack of smokes.
Generally, consumers are becoming far savvier than they used to be. Most people of adult age (and most likely a few teenagers) are beginning to understand how they are being influenced by ad placements in cinema and other entertainment venues. Similar holds true with Instagram and other social media spaces – people can tell when someone is being paid to promote a product.Thus, they are becoming more skeptical of these ploys to buy into brands. This has given birth to the increased use of micro-influencers.
What is a micro-influencer?
There seems to be a general set of specifications that win someone the title of “micro-influencer.” Turns out that the number of followers an influencer has seriously affected their power of influence over the masses writes Yuyu Chen of DIGIDAY. Those with 1,000 followers or less seem to have the highest rate of likes at eight percent. At the top of the scale, those who boast 1 million to 10 million followers only receive 1.7 percent likes. Nevertheless, that is a huge number: 17,000 people influenced.
The article goes on to explain that when Sarah Ware, co-founder, and CEO of Markerly, joined with Jenner and Kardashian sisters on Instagram in order to market a weight loss tea brand, they were able to win hundreds of conversions. Yet, when she analyzed and compared what Jenner and Kardashian were able to do versus about 40 micro-influencers, the dietary tea brand was able to convert a far larger number.
Note: For those who want to read the negative press the Kardashians and other stars received over this “detox-tea” sponsorship, read this article. It’s kind of funny.
If you read the article in the link you will find that using famous people to “influence” your brand can have dangerous consequences (and this can be true for both sides). Though the Kardashians have a huge social media following, that following doesn’t mean anything. The Kardashians have been known throughout their history to be controversial at the very least. Therefore, using such high-profile and sometimes risque endorsements for a brand could be a bad strategy.
Micro-influencer or celebrity influencer?
Social media ad platform Gnack has strictly defined micro-influencers as those people who have 10,000 followers or less. Anything more than that is pointless. They love to use people whose following is primarily made up of friends and family and a small group of fans. These influencers are usually more down to earth and genuine when they present a product that they endorse.
In an interview with DIGIDAY, Chico Tirado stated, “More than 55 percent of our agency partners have incorporated ‘micro-influencers’ as a part of their [current] strategy,”
“We’ve seen some ‘micro-influencers’ on certain campaigns get up to 25 percent engagement,” Tirado continues.
In March of 2016, following the Google and other search engine models, Instagram has moved to using an algorithm to control content quality. This means what used to work by some influencers won’t work so well now. Social media and search engines make their money from people using their services. These companies know that if their venues become playgrounds for spam and nonsense marketing strategies, they will soon find themselves in hot water. This has made it more important than ever for companies to show integrity when choosing a marketing strategy and who they choose to market them. But I guess that’s the purpose, isn’t it?
So what is the verdict?
The statistics are plain as day: if you want people to respect your brand, it is better, in the long run, to build up a network of micro-influencers that have a following of fewer than 10,000 people. The more grassroots these followers are the better.
Guest article by Philip Piletic: Philip’s primary focus is a fusion of technology, small business and marketing. Freelancer and writer, in love with startups, traveling and helping others get their ideas off the ground. Unwinds with a glass of scotch and some indie rock on vinyl. You can read more of Phllip’s work on his Linkedin profile here: https://au.linkedin.com/in/philippiletic
This is a guest post by Philip Piletic, more about Phillip at the end of this article
Successful promotional campaigns might seem random, but here’s 6 key factors that you should consider
Here’s one: Have pens made up with your company logo and information on them, and hand them out everywhere!
“Wait – what’s creative about that?”
Nothing! But pens are effective largely because they are useful. That is a huge asset to any promotional product. Nearly one hundred percent of Fortune 500 companies and the fastest-growing startups give away promotional pens. So, before we start getting creative, we are reminded that “effective” is the goal.
Creativity is often a dynamic component of a successful promotional product or campaign; it can also make it quirky in a bad way, forced or disjointed and ultimately unsuccessful. Watch some of the lowest-rated commercials for visual proof of this concept. By the way, going for the “so bad it’s great” angle is risky.
Studying these success stories will get your creativity flowing.
Useful & Effective
Logo Cups that Change Colors
Add something cold to these cups, and they change colors. Made in about a dozen warm/cold color combinations, the cups can be printed with the logo, message and information you want to share. These cups work best at outdoor events like festivals, concerts and fairs when there’s enough light to see them change.
Reason it works: It’s a novelty. The recipient will find it interesting and then play “show and tell” with it, “Hey, Jason, look at this…Serena, watch what this cup does.” You’ve produced enthusiasts who will demo the cup, holding up your branding information for others to see. The novelty is key. People don’t go round saying, “Will, see this ordinary pen I just got!” We’ve made the case for pens, but if the item can be exceptional, it will get a wider audience.
Silly Bobblehead Pens
OK, then, here’s an extraordinary pen – the pen with a suction cup cap at one end and a ridiculous bobblehead at the other. Highlighters with the same scheme are produced too. You can take this idea to the next level of fun (and expense) with the bobblehead pen that talks! The one we came across says, “Hey, don’t forget to smile, laugh and have a great day” when its button is pushed.
Reason it works: The items are useful, puts a smile on peoples’ faces and makes them want to show them off, right along with your company information.
Erasers that Save Memories
Erasers get rid of stuff…like Alzheimer’s Disease erases memories. Alzheimer’s New Zealand enjoyed a successful campaign by fitting real erasers around USB drives, and printed, “Alzheimer’s Erases Your Memories. Save Them.” On one side of the eraser. The other side featured the organisation’s logo and contact info.
Reason it works: It’s useful, so will be kept, but it has become a widely used example because there is an immediately grasped connection between the effects of the disease and an eraser.
Bendable Yoga Straws
The Y+ Yoga Center in Shanghai, China had straws printed with a woman in yoga gear positioned right on the straw’s bendable region. You get the picture. Every time the straw bends, the yogoist shows off her flexibility in a new position.
Reason it works: Like the Alzheimer’s campaign, the “get it” factor is immediate. Take time to think about, and brainstorm with your team, commonly used items that could be used to produce an immediate connection with your products or services. Thinking is hard work, but it is free and can yield amazingly creative, fun and successful promotional product and campaign ideas.
Ketchup Splatter Detergent Packs
Vantage Detergent, a brand produced in Brazil, was marketed using small packs of detergent in the color and stylized shape of a ketchup spill. The packs, about 100,000 of them, were divided among restaurants in São Paulo, and were snatched up by customers in three days.
Reason it works: The colorful packets encapsulated a standard marketing strategy – identify a problem, and provide the solution.
Putting it All Together
Let’s compile our list of keywords, principles really, that give tremendous guidance for choosing or designing promotional products and using them successfully as part of your marketing mix:
Connection [between the item and your product or service]
Build as many of these into your marketing efforts, including the use of promotional products, and you will enjoy far more hits than misses. This is especially true when you tailor your product, product design and campaign strategy to your target demographics. Take an hour today by yourself or with your team, and think, think, think your way to creative promotional products and campaigns that will be effective. That’s the first principle and the one that will most affect your bottom line.
Guest article by Philip Piletic: Philip’s primary focus is a fusion of technology, small business and marketing. Freelancer and writer, in love with startups, traveling and helping others get their ideas off the ground. Unwinds with a glass of scotch and some indie rock on vinyl. You can read more of Phllip’s work on his Linkedin profile here: https://au.linkedin.com/in/philippiletic
Education is the first step if you’re competing against the Do-It-Yourselver
In August last year everything suddenly came together for me. In a period of 6 weeks I signed up 7 new clients. I was very excited. Finally, after all the years of pushing and pulling, trying every approach under the sun to market myself to my target clients, it suddenly all fell into place. I even found myself starting to get concerned how I might handle things if the deluge continued.
But I needn’t have worried. Since then it’s gone back to drought. I’ve had virtually no serious inquiries in the 7 months or so since then.
And the thing is, I do do great work (my clients tell me so frequently and I have lots of glowing testimonials here for example) and increasingly, lots of people do know about me. And yet, after 12 years I continue to have these lengthy drought periods.
Honestly, It’s doing my head in every now and then.
I’m reminded, that sometimes, things aren’t quite as simple as those two time honoured rules imply. If you have a blocked toilet, or you want to go to a restaurant, or buy a fridge, a car or a home, those two rules apply without exception. All that the marketing and sales strategies of the plumbing company have to achieve, is that the client is convinced that this plumbing company will fix the blocked toilet quicker, better, cleaner, friendlier or cheaper than any of the other plumbing companies out there.
But there’s a third secret
But things get a little trickier if you are an architect who designs and manages renovations for home owners, or an HR consultant who helps small business owners manage staffing and recruitment, or a PR agent who helps small business owners gain publicity, or an SEO consultant who helps small business get found on Google, or a wedding planner who helps people have a great wedding. If you are a professional like that you have a third thing you must do.
Not only do lots of people have to know about you, you also have to convince your prospects that hiring a professional is much better than, doing it themselves, DIY. Your services cost money over and above the actual thing they want doing. Recruitment services for example can easily cost an additional 10% on top of the wage of the new employee. The PR agent might cost you $3000 per month or more. The architect might charge upwards of $25,000 on top of the build-cost of the project.
Your client is your competitor
You’re not competing with other professionals, rather the first competitor you have to face is the actual client. The client needs to be convinced that they really shouldn’t go DIY. They shouldn’t try and manage their own renovations, run their Facebook advertising campaigns, organise their own wedding, or find and hire a new employee.
I strike a similar issue with some of my potential clients. Most small business owners think they ought to be able to do it themselves. To go looking for help from someone like me, can be a significant investment and can feel like admitting that they’re not upto the job of being a business owner.
Nothing is further from the truth of course, my most successful clients have always been the ones who have no hesitation in asking for help, but it’s often a hurdle I have to overcome with small business owners.
The recent drought has reminded me, that the first marketing step for people like the architect, the PR agent, the wedding planner and myself, is to educate the clients.
The PR agent has to educate his clients that having a PR agent (not necessarily him personally) take charge of gaining publicity for the client is vastly more effective than DIY. The architect has to educate her clients that engaging an architect leads to much better renovations than DIY. The wedding planner has to educate her clients that the wedding is going to be so much more fun when a wedding planner is running the show than DIY. And I have to educate my clients about how a business coach can help transform your business, rather than DIY.
I’ve actually known about this issue for a long time, but forgot over the past few years. It’s time to focus on education again. In the next months I am going to create a bunch of case studies and stories in article and video form to help small business owners understand that engaging someone like me (not me specifically) can transform their business and their lives.
I suggest that you think about the question as well: Who is your greatest competitor? If it’s actually the clients themselves, you should change your marketing strategies to focus on education first… I promise you.
But there is an old saying in the advertising industry that is still just as true now as when it when coined in the sixties by a famous CEO, that half of all money spent on advertising is wasted, if only we knew which half.
The big temptation that gets us as small business owners to spend more money on advertising than we should from time to time, is how easy it seems. It’s the easiest, least time consuming and quickest way to get more customers. It’s the reason the Yellow Pages phone books became so big and profitable all round the world. If you wanted more business there was a simple equation for the Yellow Pages: spend more money on bigger ads and the phone will ring more often… a direct correlation. Advertising sales people all over the world are trained to say: “Look, Mr business owner, you only have to make 2 extra sales this month, and the ad pays for itself, so what do you think?”
Good looking sales people
A perfect example of the temptation comes from a client of mine, John, who owns a gym. John was recently convinced to purchase a 3 month contract to have a couple of good looking young people hand out flyers about his gym with a special promotion offer on a couple of busy street corners. The sales person convinced John to invest the money because he only needed to get 10 people per month to take up the special offer in the flyer to pay for the promotion contract. The deal looked too good to be true.
3 months later we looked at the numbers when assessing whether or not to continue the promotion. It turned out that John’s Gym had indeed had some 60 people come in and take up the offer from the flyers, twice as many as the minimum needed to break even. However, nearly 50 of those people had cancelled their contract at the end of the special promotion period.
Luckily I’d insisted that John implement a system to be able to track the promotion and it became an easy decision for John, not to proceed with the contract.
The Golden Rule of marketing
The whole experience perfectly demonstrates two things you need to consider when deciding on any form of paid marketing, be that advertisement or some other kind of promotion.
Firstly there is a Golden Rule to consider:
If you can’t measure your return of investment, there is none.
Secondly is that when spending money on getting more prospects for your business, you better make damn sure you are going to convert a healthy percentage of those prospects to customers. There was nothing wrong with the offer that John made in the promotion, but there were all kinds of things wrong in his “onboarding” and “induction” processes in the gym. People came to the end of their promotion period and generally didn’t feel inclined to continue onto his full membership program.
I’ve seen this issue come back time and again. Business owners get convinced to spend thousands of dollars per month on Pay Per Click advertising in Facebook or Google for example. Lots and lots of visitors come to their websites as a result, but when they get there, they get lost, because there is no solid marketing conversion process in place on the site.