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.
As seen on Kochie’s Business Builders
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 the common experiences of being overwhelmed and stuck in business
Every business owner has felt frustrated and stuck at some stage while wondering how they can take their business to the next level. Which are the growth strategies that are going to work for your business?
This page lays out the 11 most important strategies to grow your business to where you want it to be. All the strategies are solid and proven – it’s up to you to mix and match.
It’s a bit like baking a cake. Most cakes have eggs, flour and sugar in them, but you can’t make a cake with only flour or with nothing but eggs. You need a mixture of ingredients. The same principle applies to building and growing your business. You may not need all 11 business growth strategies, but you certainly need a mixture of them.
So, get yourself to the kitchen and start baking something beautiful.
Everybody’s favourite business guru, Seth Godin, once summed up the solution perfectly:
“To build and grow a great business, you really only have to do two things:
If you want 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 either and that makes price the only differentiator. Competing on price is a dog’s game (unless you’re Aldi, where price is your purpose).
If you don’t know where to focus your energy, you will never master the greatest skill of effective business owners: the ability to say “NO”.
We’ve all heard that the first step towards business growth is goal setting. However, effective goal setting is more complicated than you might initially think.
Most of the goals we set for ourselves are ineffective at best, and at worst, actually hinder our progress. They’re often arbitrary, unrealistic and unrelated to what truly matters in our lives.
For instance, a goal to make $2 million revenue is meaningless. Why $2 million? Why not $1,956,384.13? And what happens when you reach that goal? Will you be better off somehow? What if you fall short by $100 or even $100,000? Does that mean you are a failure? Goal setting only makes a difference if 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.”
That’s why, if you want to grow your business, you must analyse every aspect of your business.
Yes, marketing is about branding, advertising campaigns, social media and your website, but it’s also about how you answer the phone, your pricing policies and ensuring your customers are happy with what you sell them. It’s about how you dress, how you present your quotes, your PR strategies and your warranty return policies.
In fact, one of the most powerful marketing strategies is maintaining a relentless focus on quality in everything the business does in order to create “raving fans”. Why? Because if your customers are all raving fans, they will do your marketing for you.
I don’t mean to imply that digital marketing is something wildly different from all other forms of marketing. However, it is useful to pay special attention to the online space because it has become such a critical component of any growth-driving marketing strategy.
Whether your business serves food, builds houses, crunches numbers, imports widgets or makes whatsits, you can’t ignore digital marketing activities, like email marketing, content marketing, social media and influencer/affiliate marketing, search engine optimisation (SEO), pay-per-click advertising (PPC) and online PR. The list is almost endless and constantly changing with emerging technology, such as artificial intelligence, voice search, chatbots, virtual reality, drones, and progressive web apps.
You could easily argue that the core principles of marketing haven’t changed, we’ve simply got a bunch of new tools to use. At one level that’s true because people still want to get to know, like and trust you before they will do business with you. However, 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, people want to know you’ve got a high-functioning, active web presence, including a Facebook and Instagram page, a Google My Business listing and ideally, a bunch of 5-star ratings on all the major review platforms.
The reality is, often your physical presence doesn’t even matter anymore. If you want to be taken seriously today, online engagement across all mediums and channels must be at the heart of your marketing strategy.
That’s a quote I once saw hanging on the wall at a big office. And it’s true. You won’t achieve any business growth (or even have a 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 culture is – if you’re not selling, your business will cease to exist. Simple.
Sales is often seen as a subset of marketing, but I’m giving it a solo section because I think of marketing as getting the customers to your door and sales as getting them to hand over the money. Lead generation vs lead conversion.
Sales is about skill, mindset and systems, but above all, it’s about making things easy for people. And that last word is the key to the whole shebang: it’s always about people. The old saying goes:
“People do business with people they know, like and trust.”
It’s especially important to remember this in small business because people do business with people. Your entire approach to sales 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:
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. They form part of the documentation to obtain a loan (or other type of funding) or make a proposal to a third party. Internal Plans are designed to help the business focus. They are drawn up using meaningful goals (see above), and they help people with their day-to-day decision-making processes.
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 once said, “Life’s what happens when we’re making other plans,”. Planning is like that. We make a bunch of assumptions and map our actions accordingly. Next, we check reality as it unfolds and make changes to suit those new realities – every day, every week, every month and every year.
The bottom line? Business plans that truly work and make a difference are living documents.
Customer service is also a subset of marketing, and if done well, it leads to more business from those customers (plus, as I said above, everything is marketing and marketing is everything). However, it’s worth mentioning separately because of the concept of “raving fans”.
Ken Blanchard wrote a little book called “Ravings Fans” that talks about how your business should always be working to do one better for your customers than they expect. If you do so successfully, your customers will become advocates that go out of their way to help your business grow. They will talk to their friends about you, drag their colleagues to your door, defend your business against the competition and best of all, they won’t quibble about the price. If you focus on turning your customers into raving fans, you will ultimately be able to slash your marketing budget in half and achieve a long-lasting competitive edge.
8. Grow your business with systems and quality improvement:
My clients often ask me to help grow their business and I often tell them to stop worrying about that. Getting more customers is the easy part. The hard bit about business is delivering 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, even as your business grows, then customers will come flocking to your door and you won’t need to spend much money on marketing (largely because you’ll be creating raving fans !).
I can’t tell you how many businesses I have seen struggle and fail because they couldn’t maintain their product/service quality, dependability and price once they scaled.
When your business starts to grow and you are no longer in charge of every step in the process, things often start going wrong. Quality becomes inconsistent, delivery times become unreliable, prices go up or profitability suffers – and your smile disappears. Once the rot sets in like that, your reputation nosedives and customers begin to look elsewhere.
There are only two answers to this dilemma:
Stay small: Don’t grow and learn to say “NO” often.
Systematise: Develop systems for all aspects of your operation, including estimating, quality checking, calendar management, inventory management, callbacks, warranty repair, marketing, hiring, firing and even how the phone is answered. Systems allow you to create continuous improvement loops in your organisation (and that’s the Holy Grail of business. It’s what made companies like Toyota great).
Inventory management is a big, specialised topic. 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 beautiful business that stands the test of time.
My earliest inventory management lessons came from Colin, the owner of a large hardware store who I dealt with a lot during my days as a builder. 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 once asked Colin if keeping such high stock levels of everything that a builder 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, 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, particularly 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 in order to minimise shelf space and inventory cost.
I don’t know what the answer is, but I do 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 collect.
10. Grow your business with hiring, firing and engaging people:
In his famous book “The E-Myth”, Michael Gerber wrote that it is impossible to manage people, so great businesses focus on systems and manage those instead. That’s certainly what grew McDonald’s into the enormous business it is today. 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 (that doesn’t mean I like it!). This 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 the right direction while also knowing which others should get off. 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 strategic hiring policies
Being prepared to employ people who might be better than you at certain things
Learning how to conduct great interviews
Implementing meaningful induction and development training programs
Learning how to coach, encourage and hold your people accountable
Getting better at delegating
Doing HR admin and compliance effectively
Writing job descriptions
Scheduling performance reviews
Learning what it takes to be a leader
Making tough decisions when required (quickly and respectfully)
More about hiring, firing and engaging people here:
If you want to build and grow a beautiful business that stands the test of time, you can’t afford to get left behind. The pace of change and innovation is relentless. What was acceptable even a few years ago is no longer acceptable now.
Not long ago, it was still okay for a cafe to have a sign that said, “cash only”. Today, you’ll lose a lot of business if you don’t accept card payments. Even with a business as simple as mine, people still expect the option to make online bookings. Cloud computing combined with smartphone technology and advanced GPS systems mean that customers now even expect to be informed that their plumber is on the way and will pull up in front of their house in 13 minutes.
You don’t need to be Uber or Airbnb to implement new technology or come up with new ways of doing business. A few years ago, I 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 foot in the house or even the state.
A client of mine with a creative marketing agency has a team of designers, 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 allows him to see what’s going on in every area as well as getting live access to each of the store’s point-of-sale (POS) systems. He’s also put a bunch of tablet screens in his stores that allow 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 into doctor’s surgeries, lawyer’s offices and copywriting agencies. If you think that technology and innovation won’t have a massive impact on the way you do business and how you 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.