Tuesday, October 29, 2013
The Psychology of Free
Objections are a natural part of the buying cycle. No matter how great a product or service might be, prospects are likely to have some reservations about buying it. Free acts as an emotional hot button which reduces or eliminates many of these barriers.
Does the Freemium Model Make Sense For Your Business?
According to Wikipedia, the term "freemium" describes "a business model by which a proprietary product or service is provided free of charge, but money (premium) is charged for advanced features, functionality, or virtual goods."
Does this model make sense for your business? Arguments can be made for both sides.
The naysayers will argue that giving anything away for free erodes company profits and attracts the types of customers who are always looking for free items or special discounts. Loyalty is rare with these types of customers since they only buy when they can get something free or at an extreme discount.
Daily deal horror stories are a prime example of the negative effects of discounted offers. We've all read reports of business owners who have seen poor results from daily deal coupon sites that encouraged or demanded that they offer extreme discounts in order to take part in a campaign. In rare cases, some have even gone bankrupt as a result of a daily deal discount gone bad.
The pro side argues that freemiums encourage prospects to give businesses a trial run they might otherwise never have given them. Freemiums reduce or eliminate the barrier to entry of doing business with your company. If you deliver what you promise, a certain percentage of freemium users will convert to new paying customers who will return again and again.
Companies like Dropbox, Skype, Evernote, Mailchimp, and LinkedIn have built their entire business around the strength of this strategy by giving away the basic version of their product for free to build a customer base. App services for iPhone and Android phones have also used this strategy effectively by offering a free basic version to lure customers and then offering a paid version with more advanced features.
For many small businesses, giving away products or services doesn't make economic sense unless there's a strong strategic plan in place first. Free or even heavily discounted products require funding and a strong balance sheet to cover the costs.
One strategy to consider is to have a sales funnel in place before implementation. Customers gained through free or heavy discounted offers are then encouraged to step into higher-priced services and products. This can be done through marketing communications that show the features and benefits of buying these premium services.
There are many unknowns in answering whether or not freemiums will work for your business. What's clear is that the path to success or failure lies with having a sound strategy in place before implementation. Another key component is being intimately aware of the financials, including profit margins, customer acquisition costs, and the lifetime value of a customer. Implementing and testing a freemium on a small scale before rolling it out to a wider audience can give real answers to the viability of this model in your business.
Friday, October 25, 2013
- Offer something for free or a "buy one-get one" on a popular item. Customers love these types of deals, and they are a great way to entice people into your business.
- Design your coupons as an "admit one" type of event ticket to save on an exclusive list of items.
- Provide a coupon for a free bonus item or valuable upgrade. For example, purchase a haircut and receive a free shampoo and style.
- Provide a cash value discount rather than a percentage off (such as $10 off a $30 purchase), since a dollar amount is perceived as more valuable because it feels like cash.
- Offer a discount on a complementary product or service to convince the customer to buy other products they hadn't intended to purchase.
- Provide discounts for specific groups, such as teachers, senior citizens, daycares, or healthcare professionals.
- Offer a scratch-off mystery savings or a secret code with a discount amount that can only be revealed at the time of purchase.
- Provide a discount based on the weather, a local sports team score, or something else relevant to your customers. For example, you might offer a 30% discount if yesterday's temperature reached 30 degrees (high or low, that is, depending on the locale).
- Ask customers to provide information on the coupon if they want to be entered into a grand prize drawing when they redeem the coupon (or easily track coupon use by using direct mail coupons that already include customer information).
- Distribute coupons with your receipts to encourage follow-up purchases.
- Consider turning your coupon into a discount card or customer loyalty promotion that entitles the user to a regular discount every time they visit, which will encourage them to return again and again for exclusive savings.
- Offer a coupon for free shipping or free delivery, as well as free return shipping for those who are on the fence about purchasing from you.
- Bundle a group of products or services together, showing the itemized pricing for each. Then show a discounted bundle price for value savings when purchased together.
Tuesday, October 22, 2013
For most businesses, the top 20% of their customers account for 80% (or more) of their profits. While much thought and strategy typically go into bringing in new customers, not enough is spent on retaining existing customers. That's where the real gold lies.
It may be a little uncomfortable to think that some of your best customers might be looking at making a change, but it's something you must consider if you want to avoid having it become a reality. Everyone talks about taking care of their customers, but in many instances that's a phrase not truly backed up with action. To build a fence around your customers and keep them far away from the prying arms of your competitors, you mus truly care, protect, and guide them.
Gather customer feedback on an ongoing basis.
Most businesses put a lot of hard work into getting a new customer. But after they become a customer, little effort is put into nurturing that relationship. A customer should never be taken for granted.
It's easy to get wrapped up in the day-to-day operation of your business and lose touch with what's happening outside your doors in the marketplace. Phone calls and emails to customers can be a great way to communicate and stay connected. But to do it on a large scale can be unrealistic. Informative company newsletters and surveys can help keep your customers up-to-date and give them a way to express their needs and concerns. These efforts can provide an early warning system to catch a customer jumping ship before it happens.
Tell them what you do.
Your competitors will do anything to steal your customers, including promising the moon. You know that some of these are false claims or teasers to get their foot in the door. Some of your customers may not know that. Your job is not only to provide a great product and service but also to continually remind customers about the value you provide that your competitors can't match. If you don't tell them, no one else will either.
Informing your customers through educational marketing content is a powerful way to keep them engaged while differentiating your company as one that truly cares about their success (not just your own).
Where are the weaknesses?
To help plug the holes in your business, start thinking about things from your competitors' point of view. After all, they're always looking for any weaknesses they can exploit, so you should, too. That way, you can shore up your weak spots before they get out of hand and, in the process, strengthen your position in the marketplace.
To discover your weaknesses, talk with your customers. Ask them about the areas you could improve. Stay up-to-date with industry trends that could create a possible gap in your defenses, too. You can't buy every bit of technology as soon as it hits the market, but you can stay informed so you can address concerns with your customers when they arise. Sometimes the best defense is a good offense. Be proactive in your customer communication.
"There is only one boss: the customer. And he can fire everybody in the company, from the chairman on down, simply by spending his money somewhere else." ~ Sam Walton, Wal-Mart
Customer retention starts with providing great service and value. Getting to the top is hard work, but staying there requires just as much effort. Being aware of the competition while shoring up the weak areas in your business can go a long way in helping keep your customers coming back.
Monopolies and the lack of competition aren't in anyone's best interest. Keeping your best customers satisfied is. Use competition as a motivating factor to continually improve your services. Communicating with and showing appreciation for your customers will give you an invisible force field to keep the competition out of your backyard.
Friday, October 18, 2013
The dictionary defines a habit as "an acquired behavior pattern regularly followed until it has become almost involuntary." Sound familiar?
You probably arrive at your office a certain time every day, maybe turn off the alarm, turn on the lights, make coffee, power up the computer, check emails, and so on. Some of these habits are positive, and some are negatives you're trying to overcome.
These habits are often random and don't require much thought or deliberate action. They blend into the day-to-day fabric of life.
A ritual is something quite different than a habit. A ritual is deliberate (not random) and carries with it a deeper meaning. A ritual is an act carried out on purpose with full consciousness that has a real reason behind it.
A parent reading to a child every night is a deliberate ritual that has meaning. The child will always remember it, and the act will help develop a love for books that will stay with them for the rest of their lives. Many of you know I volunteer with the Boy Scouts as Cubmaster of Cub Scout Pack #31. I was reminded by a parent a few weeks ago that Scouts serves as a modern day ritual or "rite of passage".
In our business world, we fall into habits. Some of the habits are unavoidable. To make a positive impact and institute real change, we need to add some rituals to our daily lives.
In the business world, there are two places where rituals can have a major impact: customers and employee relationships. Developing positive rituals for addressing both camps is crucial to success.
Harvey MacKay, the author of Swim With the Sharks Without Being Eaten Alive, owned an envelope printing company. Mr. MacKay grew a bankrupt company into a $100 million enterprise by developing a ritual of learning more about his prospects, customers, and employees than any of his competitors did.
He eventually developed a ritual that was the key to his success. This ritual involved compiling highly detailed customer profiles consisting of 66 questions covering every aspect of their lives -- from business to personal, family to social, and everything in-between. He made it a mission to learn as much as he could about the people who did business with his company.
"Knowing something about your customer is just as important as knowing everything about your product." ~ Harvey MacKay
One of the common characteristics of successful people in many walks of life is their keen observational skills. They study the people around them, noticing qualities and human nature. Some of us, unfortunately, walk around with our eyes half closed while performing mindless habits.
Three Elements of a Ritual
When - What time are you going to act?
Where - Where will this happen?
How - In what manner will this occur?
Meaningful rituals can have a real and positive effect in our lives. The kind of ritual you need will depend on the type of impact and change you hope to make. Success depends on action. Select one meaningful ritual you will institute now. That one ritual could be the difference between dreading another day of mindless habits versus looking forward to a day of making a difference in the world.
Tuesday, October 15, 2013
One way to tackle this problem is to look for reasons to run a promotional campaign. Holiday promotions are a great example of this strategy at work.
Holidays are a perfect excuse to promote your business. There are the popular holidays like Halloween, Thanksgiving, Black Friday, and Small Business Saturday. There are even some not-so-popular holidays. Whatever the occasion, here are some ideas to start taking advantage of this powerful marketing opportunity.
Create a Holiday Marketing Calendar
We're all busy running our companies. Planning and creating a holiday theme promotion takes time. It's easy to put it aside for later, but we all know "later" may never come. One of the best ways to remind yourself and not let a holiday pass without promoting your business is to create a calendar specifically for holiday marketing.
Purchase a wall calendar that shows all 12 months. Take a few minutes and mark the holidays you may want to promote. Place the calendar in a prominent spot, so it will serve as a constant reminder of upcoming holiday promotional opportunities.
Thinking Cap and Promotion Time
Once you decide which holidays to promote, it's time to plan and implement. Start the process early enough so you don't have to rush and send out something not well thought out. Creative promos and copy, graphic design elements, and the offer itself are the seeds for the holiday campaign.
Ideas to hit it out of the park with your holiday promotion
Make it Relevant -- Remember that your prospects and customers see many promotional offers every day. Make your offer stand out by tying into the holiday theme, while at the same time making a strong case why the recipient should take action on your promotion.
Personalize -- Many holiday promotions are generic, which lowers the chance for success. One way of adding a personal touch to your campaign is through variable data printing. Everyone likes to feel as though you've made an extra effort on their behalf. Personalization can help show that you care.
Smart Design -- Let your visuals do the talking. Use a clean and clear design to tell the story. Choose what you want to promote, and let it stand apart by not cluttering or overcrowding the graphic layout.
Make your call-to-action a strong one -- Tell your prospects exactly what you want them to do next. Should they call you? Visit your store? Go to your website? Be clear and spell it out to make it easy for them.
Now it's time to let the world know about your promotion. Direct mail postcards, print and email newsletters, signs, and social media posts are just some of the ways you can publicize your campaign.
The holidays are already in your prospects' minds, so a holiday-themed promotion has a much better chance of getting noticed. You can leverage fun, creative themes associated with each holiday.
Holidays also give you a reason to offer a temporary discount or special offer with a logical end date.
Holidays are typically a fun and festive time. They can be even more fun when customers spend their money buying what you sell! So put your thinking caps on, and don't let another holiday go by without capitalizing on the opportunity for some creative holiday promotions to grow your business.
Friday, October 11, 2013
What Is Content Marketing?
A lot of people think content marketing is a new, revolutionary theory. Really, though, it's based on the age-old principles of customer service. As you know, your customers lack your expertise. Traditionally, customers would come to you for advice, just like you would go to your printer for advice. You would then give them the information they needed to buy the right products and services to solve their problems. As the provider of that information, you would also get the sale.
The Internet changed that. Fewer people are willing to go into a store to get the information they need. They're more likely to go online and seek out the answers to their questions. The information they want is available in the form of content. Content may be written or presented in an audiovisual form. That content is branded with the business identity of whoever created the content.
This is content marketing. If you're providing the content in your business area, then you'll be the person customers come to when they're ready to act on the information you provide. The key is branding your content and distributing it to your local audience.
How Does Content Marketing Help Your Business?
Your customers probably take your expertise for granted. Whether you style their hair or repair their appliances, the quality you provide to your customers is dependent on your expertise. Yet customers don't tend to notice unless the job is done poorly.
Imagine for a moment what could happen if these same customers understood the level of expertise you provide and actually valued your input. Imagine if you used your expertise to reveal product and service options your customers didn't realize were possible. Imagine who they'd come to in order to get what they wanted.
That's how content marketing helps your business. You not only have the opportunity to establish your expertise in the minds of your customers, but you also have the opportunity to establish new needs and wants in their minds. It's better than advertising or sales, because your customers don't feel pressured. Yet, from your perspective, the effect is the same, because you're the one they'll want to come to in order to get the expert service only you can provide.
How Do You Provide Content?
In order to use content marketing to establish your expertise, you need to create and brand content that will add value for your customers. Consider what you think your customers should know and then create the content that provides them with that information in an attractive and engaging way.
You don't even have to create the content yourself! There are businesses that specialize in creating content. You can find them pretty easily using the Internet. The key isn't who creates the content, but how it is branded and how it reflects your expertise.
Once your content is created, you have to distribute it to your customers. You can create a blog or a YouTube account and post your content online. You can use social media and e-mail to draw attention to your content. You could also create your own newsletter and mail or e-mail it directly to your customers. If you'd prefer to stick to print, you can use your content to create brochures, flyers, and booklets. Then, simply include your content when you mail invoices or other items.
The important thing is to get your content in the hands of your customers.
Tuesday, October 8, 2013
In a recent interview, Rowling revealed an interesting fact about the series. She was rejected 12 times by publishers before finally getting her book accepted. Yet, even though her first book had not been accepted, she still did something that many never do: She knew exactly what the ending of the series would be.
Rowling wrote the final chapter of the final book in her series, so she knew how the series and the story would end. That helped lead her to logically fill in all the plot lines and action sequences to get to the conclusion.
"Start with the end in mind." ~ Stephen R. Covey
In our business and personal lives, we rarely know what the end game should be or what it would look like, as clearly as J.K. Rowling did with her Harry Potter story. As a result, it's not surprising that businesses struggle and projects go sideways.
The lack of goals or the desire to get things done are typically not to blame. Instead, the culprit and missing ingredient is most likely a clear vision of what the ending will be.
In a business ownership example, that might mean knowing the exit plan of selling the business. In managing a project, it might mean knowing exactly what the finished product will look like. In a weight loss example, it might mean knowing what you want the new you to look and feel like.
Human nature is the common quality of all human beings. People behave according to certain specific principles of human nature. Whether leading a company, a group, or even ourselves, we need to understand what motivates and moves us to the end goal.
Every January, every week, and every day, goals are set by wonderful people with the best of intentions. Yet only a dismal percentage of these lofty (or even mundane) goals are ever accomplished. This often leads to abandonment of dreams and higher aspirations.
The desire to do what it takes is not something that's easily manufactured. Great leaders know how to lead movements, nations, and countries by tapping into human psychology in ways that others don't. These leaders know that real action, progress, and momentum only come when a highly desired end result is clearly laid out.
On May 25, 1961, President John F. Kennedy presented a historic challenge to the people of the United States. He set a goal of putting a man on the moon and returning him safely to Earth before the decade was over. His dramatic speech galvanized a whole nation and resulted in Neil Armstrong touching the lunar surface on July 20, 1969.
Steve Jobs had a clear vision for Apple and each of the products the company would roll out to revolutionize entrenched and established industries. There are numerous examples of other great leaders of companies, nations, and movements who made a big impact on society. The one common theme: they knew how to clearly articulate the vision and end result in ways that resonated.
"Life can only be understood backwards; but it must be lived forwards." ~ Soren Kierkegaard
J.K. Rowling sat in the coffee shops of England as a struggling single mother writing her Harry Potter stories. There were many things she could not have known about what the future would hold for her. But there was one thing she did know that drove her forward despite all the negativity and obstacles: how her story would end. Not everyone can write Harry Potter books, but we all can get much clearer about how our own stories should end. If we can do that, maybe there will be rewards much greater than the billion dollars J.K. Rowling has earned.
Friday, October 4, 2013
What is Guerrilla Marketing?
Jay Conrad Levinson coined the term guerrilla marketing in 1984 with the release of his book, Guerrilla Advertising. In military terms, guerrilla refers to an unconventional form of warfare used by armed civilians, often against a force with superior numbers and weaponry. It relies on surprise, sabotage, and the ability to hide among a crowd. Guerrilla marketing is a take on advertising that uses similar tactics to gain attention.
The primary advantage of guerrilla marketing is its ability to increase a marketer's impact using less costly resources than traditional advertising. It relies on high energy, imagination, and ingenuity. The idea is to take your customers by surprise, make a lasting impression, and create the kind of buzz that gets people talking.
The following two examples will help you wrap your mind around this strategy:
1) A new, locally based beverage company posted creative flyers on light poles and other public structures all around town. These flyers looked more like graffiti than advertising. Nobody even knew what it was all about, but the images stayed in their minds. After approximately three months of bombarding the public with these images, a billboard was displayed which used the same images, but also identified the company and the product. A brand was created before anyone knew what the brand was for. This is guerrilla marketing.
2) Compare this to a strategy used by a national research organization. They created billboards and took out full-page magazine ads that compared a neurological disorder with child abduction. These fundraising advertisements included the organization's name and contact information. The shock factor backfired and complainants formed organized protests. This isn't guerrilla marketing. It's simply disrespectful and in poor taste. There is a difference.
How Has Guerrilla Marketing Evolved?
If you visit Jay's site, you'll see that guerrilla marketing is alive and well and evolving with the times. Guerrilla marketing is online -- and you should be, too. Guerrilla marketing values permission-based marketing strategies -- and you should, too. Guerrilla marketing uses popular culture to make an impression -- and you should, too. Guerrilla marketing emphasizes ethical communications that are also creative and unique. And that's exactly what you need!
When guerrilla marketing first became a hit, consumers were inundated with "professional" advertisements on television, radio, magazines, and newspapers. Now, it seems anywhere and everywhere we turn we encounter ads -- they're even in public restrooms! If we were numb before, we're deadened now.
Advertising and "traditional" marketing just doesn't have the impact it should for the dollars companies spend. And it's no wonder when there's so much advertising in so many places that it seems we never get a break from it. Guerrilla marketing breaks through all that clutter by being different. Not just different from your competitors, but different from its own past.
How Can You Use Guerrilla Marketing?
You can use guerrilla marketing to get the scattered attention of your target customers by becoming a bit more creative in the ways you reach out to them. Surprise them. Capture their interest. Offer something of real value.
Remember guerrilla warfare. You can't rush success. Guerrillas knew that. Civilians battling a superior force with superior arms would spend years, decades, even generations fighting for what they believed in with whatever means they had. Take a lesson from them.
First, know that your business is worth fighting for. Second, you won't win the success you want instantly. Third, you need to build your credibility with your target audience (i.e. the civilians you're saving), not with your competitors (i.e. the superior force).
With these three things in mind, break out of the marketing box you've fallen into and prioritize communicating with your customers. Surprise them with how helpful, genuine, and trustworthy you can be. Sabotage the competition by offering a better value with better intentions. Don't be afraid to blend in and mingle with your customers. After all, they are the only ones who really matter. Be one of them. Help them. Build a future with them.
This isn't a battle for sovereignty or freedom. It's a battle for the hearts and minds of your customers. The secret isn't a parlor trick or a timely fad. You can't take their trust. They have to give it to you. You have to earn your customers' trust. If you can do that, then you can evolve into the future with them right by your side.
Tuesday, October 1, 2013
Is Direct Mail Worth Exploring For Your Business?
Have you noticed that many of the Internet companies (like Google, among others) have been increasingly turning to direct mail to advertise their services? The reason is that old school direct mail worked long before the Internet and has been working for smart marketing in businesses all along. It just happened not to be the flavor of the day, thereby not getting much attention.
Now that the furor and publicity surrounding the "free" aspect of social media marketing has settled into the reality that free doesn't necessarily equal real customers, smart marketers are looking for real campaigns that result in real customers.
Living Together in Harmony
Leveraging one proven marketing channel is great, but taking advantage of two or more is better. As effective as one channel may be, you limit the potential impact when using a single platform. With an integrated marketing strategy, you position yourself to maximize the real potential of your campaign.
The truth is that direct mail can still deliver real results when done correctly. In fact, direct mail works even better when coupled with email marketing and Internet marketing. When coupled with other channels, direct mail has the capacity to be even more targeted, personalized, and effective than when any of these channels are implemented alone.
To make this work and deliver results, it's very important that the messaging and branding be consistent across all the channels you use. The logo, tag line, messaging, design, and colors used in one campaign should be reinforced across all media to generate stronger results and a more powerful impression. Consistency allows each campaign to feed off the other and deliver a bigger bang for the investment.
This is how big brands are able to leverage the power of multimedia messaging. Today, with the availability of affordable, short-run digital printing, you don't need a large budget. It's realistic and available for businesses of all sizes.
An example of a campaign that works extremely well is a new customer campaign. Nothing shows appreciation like a nicely designed, professional-looking direct mail piece delivered to your new customer soon after they become a client. People know that an email costs nothing to send but that a direct mail piece has a real cost.
Now you can follow that up with some informative emails to educate your new customer about how you can help them solve their problems. In the emails and direct mail pieces, ask your new customer to also connect with your brand on social media. Now you can further develop a bond with your new customer by sharing your values and core messages across all media.
Marketing success is about momentum. An integrated, multidimensional campaign, implemented consistently throughout the year, keeps the marketing ball rolling forward. This allows your business to be fresh on prospects' minds when they're ready to buy. The more consistent your brand, marketing message, and integrated approach, the better your results will be.
Your customers consume information in different ways. You can't guess or assume one is better than another. Showing up in the physical mailbox, in their email inbox, and on the web assures that your brand is leaving no stone unturned. Having an integrated marketing strategy assures your business will be seen and heard. If just showing up is half the battle, then implementing this multidimensional approach is your call to action to make yourself ready for new customers on the business battlefield.