You will have heard the term “Cannot see the forest for the trees”.
For me, this means that it is very difficult to see the detail when looking at the big picture. And, it is very difficult to see the big picture when closely studying the detail.
Many business owners I meet are amazed with this simply analogy is applied to marketing and growth.
Consider – you have a brilliant strategy – you have nailed the big picture. It is clear and you can see precisely how the segments all fit together. You are ready to ROCK!
And then comes time to take action. The details that were not so clear in the big picture are not clear. What EXACTLY will our adverts say? When EXACTLY will we schedule our radio ads, or adwords spends or webinars or TV or ReLaunching Celebration?
We enter a state of marketing hell.
The other variation – which may be more common in our part of the world – is that we get deeply entranced in the DETAIL, without having the big picture even partially outlined.
This is where we organize the channels (media like radio, web, adwords, TV, press, instore colour schemes, and even the artwork on our vehicles – BEFORE we have established the VALUE content that is the message that will educate and attract our targeted groups.
There is a clear order in making your marketing work for you. And the biggest mistake made here in Townsville, or in any part of the world – is NOT getting the powerful content that will attract and retain your leads generated FIRST!
And then you can use this information while considering your ideal prospects – to choose the most potent, most predictable, most profitable methods to get that message out (ie the “media”).
A summary version of your Marketing Message might be your “elevator pitch”. Some people ignore this concept because they believe it is only of use in “networking” – and they don’t “do” networking so avoid the powerful thinking needed to create this tool.
The reality is that this tool is a short version of your marketing message. And it needs to be applied consistently to ALL your marketing efforts. Your website, for example, is lame and ineffective if you do not communicate your marekting message clearly.
For 99% of the sites I see in Townsville, you could easily just swap the names and contact details for you and your closest competition – and no one would even notice, not even YOUR team…
In the coming month, I am launching a new Marketing Business Development Course designed to first educate you on exactly WHAT to do, and guides you to take simple, step by step actions that gets that done for your business.
If is perfectly designed for businesses who have room for growth – who could double, triple or 10x their revenue without having to turn off the leads tap so they can build new systems so they can “keep up”.
You know that in business, the constraint to explosive growth is either in the marketing, or in the ability to deliver the product or service to your standards. You get really (too) busy, then you have to focus on building up capacity. Then you have extra capacity, and can turn up your marketing again. And over the top – is the need to remember that if you deliver poor quality experiences – your marketing is doomed anyway…
So – this new program is designed for micro, mini, small and medium businesses who at this time have the constraint of no growth.
I am still crafting the guarantee for this program – but it will be extreme. Right now my guarantee stands at
“With use of this program you will increase your revenue by 5 times it’s cost or get your money back or I work with you until you it does.”
The program will sell out – there are limited numbers available – because I am serious about the guarantee. I have set up levels that allow any business owner to participate – no matter how restricted your cashflow. In fact the first part of the education has the ability to focus first on getting some money in the bank quickly.
Please use the contact form (click here) to make initial contact.
Ps the process will be for you to make initial contact, then we will organize a 14 minute phone call to talk about it. There is no sales pressure, the aim of the call is to find out if you and your business suits this amazing program.
A good reminder about a philosophy that can make your break your business.
On the weekend, I went to get a haircut. (Yes, this is pretty riveting but stay with me.)
For me a haircut has become about trust. Over the decades I have had some rather appalling experiences with haircuts. And my strategy evolved into finding a hairdresser who knows much more about a good haircut than me – and then allowing them to be in charge of my haircut. Simple ay?
The initial meetings go something like this.
The professional hairdresser will ask me (the “client”) what I would like like. I say something like “I would like the best haircut you can give me given the thinning of my hair and the shape of my head.”
This usually stumps them for a while. And they will take some action like combing or pulling my hair to determine the length, thickness to allow them time to think of something to say. Then they will ask a question like “How much off the sides/top/whatever would you like?”
As gently as possible I will say “I don’t know. What do you think will look best for me?” This will cause them to put on a thoughtful face and swirl through my hair a little bit more. I will attempt to give them confidence by saying something like “You seem to know what you are doing. Give me a haircut that makes me look professional, and that my wife and daughter will approve of.” And “I am really good at many things, but hairdressing is not one of them – so you are in charge.”
There is usually some kind of “agreement grunt”, and they begin. Then – there will be another question that shows they do not yet have it. Something like: “Do you prefer scissors or shears/buzzing thing whatever it is called?”
Still as gently as possible to as not to appear to be rude or dominating or at least less strange – I will respond with “I don’t know. You are in charge of the haircut – just give me the best haircut you can.” And eventually they begin.
Stay with me now, the marketing lessons will flow.
If you are a woman, chances are that you have a hairdresser you go to. And you want the same person each time. Why? Because after your first visit with them, you have a little trust built. And once you a have been once – there is a great chance you will return. Should you return a second time – there is an even higher probability you will return a third time. And after 3 visits – you will keep going there until they stuff up really badly or one or both of you leaves town or retires/dies.
Any smart hairdresser/service provider of any sort knows this and has a clear process to get you past the 3rd transaction as predictably as possible. It is a vital conversion measurement – and there are specific tactics that work marvelously to increase the conversion, which magnifies the power of your initial marketing to get the first appointment and will make you business predictably successful.
That is nice – but today I want to talk about trust. So – generally after 4 or 5 visits to my increasingly well trained (ie – they know more about haircuts than me so they are in charge) hairdresser – things run fairly smoothly. I trust them, and they know they are in charge of my hair. I am under their protection.
Remember that phrase: “Under their protection. ” It may be the key to your massive business success.
The same way that I am “under the protection” of my lawyers, accountants, personal trainers, chiropractors, doctors, and even my lawn mowing guy. All these business have to do to retain my support is to act in my best interests whenever they supply or suggest a service. Lawyers can sell me some Will updates – just by letting me know it is in my best interests to do so. Simple. Not pushy. And because I trust they are “protecting me” – I will take the advice.
What are the numbers of a man’s haircut? Average time between cuts is 5 weeks. My hair grows pretty fast so 4 weeks is good for me. Cost at my last cut was $27. This means my base revenue is $351 per year. Chances are that unless they do something to break my trust – I will come for at least 2 years – so my minimum lifetime value is $752. (There are tactics to increase this obviously – but only available if I retained as a client – which means “under their protection”.)
How can a hairdresser destroy this trust in your protective umbrella? Like this. Change the person who is going to cut your clients hair from their usual to someone who does not yet have the skill to protect them.
Or bluntly – allow a poorly trained junior to deliver a “bad” haircut. It was my own fault. I had assumed that my usual hairdresser understood this concept of “protection”. In fact, when this very young, un-confident new stylist asked me “How much would you like off?” I said “Just ask Jxxxx, (who is standing 10 feet away) she knows.” But she only delivered a one sentence instruction then wandered off, leaving me to my scraggly headed fate.
It is interesting how we can only begin to gauge the expertise of a hair stylist AFTER they begin to cut. And with very successive snip it becomes more and more impossible to escape, despite the knowledge that an inept person is guaranteeing you will need much more hair product until it grows back.
And in the back of my mind “Why did Jxxxx not protect me from this?” Damnit. Now I have to find and train a new hairdresser again. And also – how the heck am I going to stick down that chunk of hair that is shootng out at right angles from my temple on one side only?
Ps – I may have added just a little drama to this haircut – my world is not going end because of it. Stay tuned for a post very shortly about a model you can use to strategically create a bullet proof business where you do not need to compete on price.
Once we let of the inference that the other months are not strategic thinking months – this can be a great opportunity to add massive leverage to all areas of our lives.
I will post more about this tomorrow – but today I want you to just think about the first necessary part of that program [the one that adds leverage to every part of your life]. And then just name and write down each part of your life. That’s all – just write down the way that you would categorize each part of your life.
Eg – One is very likely going to be “Health”.
I expect you are going to have between 5 and 10 “parts” of your life. But you can have as many or or as few as you choose.
Increasingly I am finding that as clients actually “get” the concept of lifetime value it completely changes the way they think about their marketing. Over the next few articles I will focus on the detail that often helps the idea to “click” in business owner’s minds.
Today lets talk about getting new customers – but keep in mind that getting NEW customers is not usually the most powerful way to grow your business in the short term – but it is on that list!
OK. We are talking, and you say you want to do some marketing to get some more customers. We already have strategies in place to increase your business not from new customers – so let’s go!
Question 1. How much are you willing to pay for each new customer/client? Answers are usually like – well I was going to put an ad on TV or Radio – for about $x,000 – and see what happens….
Hmmm. I see. And if you have done that before – what happened? Umm. Well not much. OK. So how many leads did it produce -and how many new customers from those leads? Dunno. About 10? OK. What was the average first sale ($) to those new people? Dunno. OK. What offer or incentive did you give to the new customers to come back again? None. Ok. When these new people came in – did you capture their names and contact details so that you could write or call them and welcome/thank them for coming in and give them a offer or incentive to revisit? Umm, no.
OK. So how much did it cost you to get those 10 new people to buy once from you with that experiment? [Paid $3k, got 10 visitors who spent avg $110 at margin 40%. Gross profit on sales $1100 x .4 = $440. Less $3k for ads = $2560. Divide by 10 new customers (let’s pretend they will all come back sometime even without an offer) and the cost per new customer was $256 each.
That is, and this number is often less than most people waste away on their marketing, he paid $256 for EACH new customer to come in ONCE. No thought was given to how to make the process profitable. No details captured. It would have been more profitable to just pass out 20 x $100 bills in the street.
This is the marketing process of most people in business today, even though the concept of “lifetime value” of a customer has been around for decades. Studies have shown that lack of useful training in one of the major factors in the horrific statistics on business failure. Along with lack of financial literacy – do YOU have an accurate cashflow forecasting tool that is up to date? Probably not. And that in my mind is the BIGGEST business crusher in the short term. But that is another story.
Ok. Let’s cover the basics of effective marketing in a quick and dirty way.
Rather than look at the potential profit on the first sale to a new customer as the return for the marketing, think instead about how much money that average customer will spend with you during their time as a customer.
Example: If average unit of sale is $1000, and average number of customer purchases per year is 3, and average time as a customer is 3 years, then lifetime customer value is $1000 x 3 x 2 = $6,000.
So the question in the example becomes how much would you be willing to invest to buy a customer that is worth $6k in sales over the next 3 years? For your answer you need to know your margins, and logically also want to create strategies to increase that lifetime value by increasing the time that customer stays with, the number of transactions per year, or increase the value of each transaction, and so on.
So – if the margin in this example was say, 40%, how much would be willing to pay to get a new customer? Consider that at 40% and average sale of $1,000 – there is $400 gross profit on the first transaction. Would you be willing to break even on the first transaction to get a new (good) customer? Would you be willing to make a loss on the first transaction if you had tested and had a process in place that predictably brought the customers back at least one more time?
So – did this concept CLICK in your mind yet?
Almost? Well consider this. Once you have determined the actual value of a customer – you can often just do away with a great deal of advertising. Instead, get a list of prospects that fit your ideal client criteria – and send them a letter saying you have opened an account for them with an existing credit of $x00 they can use anytime in the next time period. When they come in – you already have their details, you can track the return on your investment in them, and you get as many people you want to come in.
Am I saying to consider giving the money you would have used on advertising directly to your prospects? YES.
Do you have to plan this and do it in a scientific, predictable manner? Yes.
Does it mean you are just reducing your prices? No.
Please comment below with examples you now see in the business world around you. HINT: think about the “free” $x00 phone when you sign up to a phone plan. Or – which is cynical at this election time here – $25B if you vote for us?
More articles along this path coming so subscribe.
Townsville Business Coaching
“I hope more customers will come into my business this week.”
“I hope the Townsville economy will turn around.”
“I hope that roll of fat around my waist will just go away.”
“I hope my business opposition will do lousy marketing this year just like last year.”
It is great to have “hope”, but if “hope” is your business strategy – you are heading towards a lot of pain. Your strategy does not need to be complicated. Your strategy will generally be aimed toward delivering MORE VALUE.
But most importantly, your strategies will need to have a snowball’s chance in hell of working. And need to be monitored so we can know if they are working or not.
One analogy is a business hospital. There is outpatients, the ward, and intensive care. Each area has a specific purpose [or goal]. Outpatients will give some patching up, or some mild drugs, some ‘exercises’ to do – and you are sent back home.
The ward is for when you are a little more ill or there is a great risk of your ‘condition’ becoming ‘serious’. The purpose here is guide you to recovery and ‘observe’ you to ensure that you are going in the right direction.
Now, Intensive Care is there to keep you alive – to stop you from dying. Because currently – when you are dead – nothing further can be done to help you.
Here is is your question. What is the main strategic action that is purposely layered for each part of the hospital? What is the thing that happens a little in outpatients, more in the ward, and is constant in intensive care?
One answer is that your medical bill goes up! It costs a lot more in intensive care with all those machines that go ‘beep’, and the people that interpret their data. That is your clue.
The answer is that with each level there is increased MEASUREMENT. In intensive care it is constant. Almost every indicator is measured by the second. It is recorded and compared to expected. If there is a variance – expert people take action. If there is a huge variance – ALARMS sound – and more people rush around in a (hopefully) purposeful way. Terms like “CRITICAL” are used – which means all possible monitoring resources are used. There is “STABLE” – which is lower level, but not too far from CRITICAL.
Once all the measurements have be in the ‘expected’ levels for a while, you may be moved down to ‘the recovery ward’, and hopefully then ‘released’. This means dropping back to visiting outpatients or your doctors daily or weekly. Then monthly, then just for “check-ups”.
So where does your business fit in this model? Do you know the measurements for your business that indicate its ‘health? Is your business in a ‘stable’ but ‘critical’ condition, and you are ‘hoping’ something will change for the better soon? Or do you know the ‘drivers’ for your business, and go to a business personal trainer who strengthens them, as part of your goal of being a successful business person?
Just like our bodies, our businesses are interlinked systems. We can measure the health of both by using standard measurements. We can know when we are getting weaker or stronger. We can know the ability of both handle a ‘crisis’. We can predict accurately how long each is going to last depending on the trending of our measurements.
For example, if you have been putting on 3kg of fat each year for the last 5 years, or your blood pressure is trending up fast, it is not a big call to predict some crises ahead. Similarly if your market share of the product line that actually makes most of your profit is dropping consistently – you are headed for crises. If you have stopped having holidays, and are considering having more children to “breed up” some “decent staff you can trust” – you are also headed for a crises.
It is one thing to know your measurements are not in the healthy range. It is another to take appropriate action to fix them. Let’s pretend you are carrying some extra fat on your body. So you know you are ‘storing some body fat for the cold Townsville winter ahead’ or whatever your denial statement is. What will it take for you to change – and get your health measurements heading in the right direction again? Will it be a severe health crisis? A minor heart attack, or being told you are now a diabetic? Or will you catch a glimpse of yourself in the mirror as you leave the ice cream shop? Or maybe you meet someone your age who looks fabulous – and they inspire you.
At some point we all change – and it is usually by crisis. But it does not need to be. Once you decide – what then?
We can charge off like a loon, and diet and exercise like crazy. Or we can STOP, think, consider strategies that are worth testing, and plan the actions and goals that will test the strategies. ie we want it to be SUSTAINABLE.
It might be your bank manager, or your accountant, or the ATO. Or you might suddenly have your own flash of insight and recognize that what your business is doing is not going to give you what you want from it. You might jump up from being ‘in your business’ to the level above where you can see better – realize your business is just a ‘tool’ that you can use differently – and start to wonder…
If on average humans are going to live about 90 years – this is 4,680 weeks. If your business is the tool that is going to provide for an important role in your life – then becoming an expert user of this ‘tool’ seems prudent. Would you pick up a powerful welding machine and just start using it? Or would you learn more about it. Get some training, do a course, find out what the [measurement] dials are for? If your welding machine was going to be an important part of your life – would you want to become ‘professional’ or ‘expert’ at it? Or are you going to stay an “AMATEUR”?
Would you be happy to stay at AMATEUR level with your business? And maybe ‘hope’ things will change…
Don’t want to be an AMATEUR business owner? Then just let go of the need to be right. It is not your fault that the training you were given (if any) before going into business left some important bits out. Cutting hair is not great training for owning salons. Being an accountant is not always a great training for owning an accounting business.
We take the information available and convert it into our business model. All we have to do is let go of that model and choose a model that others are using to get the outcomes they want. This is the same for business as it is for health.
You want to be lean and fabulous? Learn what the lean people do. and do that.
You want to be great musician? Learn what the other great muso’s do – and do that.
You want a great business? Learn what people with successful businesses do – and….
Business Builder and Coach, Townsville
Ps remember – unless you have a plan, you are most likely part of (or victim to) someone else’s plan.