This is a sample of the Marketing Bite Newsletter. The formatting is a bit messed up – but you can see past that, right?
Marketing Bite Sample 1
A happy man with a big hat delivered my 2012 Townsville Yellow Pages yesterday.
I saw him – and asked if I could have a second copy. No worries. He did not ask why – and would not care that I use the second copy as a booster seat.
And I use the first copy for… well I only really use it to compare the number of ad pages to previous years.
Other than that it sits on the shelf, in case I cannot find what I want on the internet. In the last 12 months – I have referred to it for information before buying a product or service – well – zero times.
In the “olden days” I would keep a copy in each car – for the maps. Now I have an iPhone. And my prediction is that my children will never use the Yellow Page book in their lives?
The Yellow Pages Score?
2007/8 932 pages of ads (excluding YP ads at the back)
2010/11 904 pages
2011/12 804 pages
2012/13 717 pages ( and Smaller Book!!!)
And when you consider that Yellow Pages have been filling more and more of the books with their own ads each year – maybe they are ”hoping” it will increase their sales?
So why do I often still recommend some clients have a YP Advert?
See if you can work it out.
In an example – let’s say that the average lifetime value of a good client is (say) $3000. Maybe this a hairdresser with average sale $100, 10 times per year for 3 years. We wont count value of referred people from this good client – just to keep the maths simple.
Now – because you know when you get a new lead (and a new client) – and you capture their details for your database (because you know that when you sell your business – that is the most valuable bit for most businesses).
And you record which of your marketing tools created the lead. You might get a table that looks like:
Flyer #1 20 leads with cost per lead (CPL) $75 (eg cost you $1500)
TV Offer 10 leads with CPL $100 (cost $1000)
Direct Mail to Your Accountants Clients 50 leads with CPL $5 (cost $250)
Yellow Pages 50 leads with CPL $150 (cost $7500)
Newspaper Advert 1 lead with CPL $2000. (Cost $2000)
For simplicity – let’s pretend you have the same conversion rate for all of these leads (eg 50%). So the cost per customer becomes double the CPL. (Except the newspaper advert)
Now – which of these activities would you repeat? Which ones would you stop?
I know that you are very smart. You subscribe to my newsletters right? So you probably are thinking that you want more information before answering – right?
Maybe you’d like to know what percentage of leads from each source was able to be booked for the next appointment?
Because YOU know that the first appointment is best designed to get them to come to the next appointment – right? So you have a special offer for first time visitors – right? And some kind of tool (eg a loyalty program/newsletter/membership) that is introduced at the 2nd visit, right?
And it might be interesting to know how much on average each source spent on their first visit?
The interesting thing is that 99% of small businesses do not even collect the first level of statistics. eg how many leads did each marketing activity bring in? Umm.. Gee. Dunno. Ok – so what about your last 20 new customers? Um…
Ok – so what is the purpose of your business again?
And the owner may waffle a bit about delivering value, caring, sharing, following your passion, yada, yada, yada. I just pick my nose and wait for their light bulb to go on.
Soon I just give up and offer a nice generic purpose so they get the idea.
Like: The purpose of your business might be to attract, convert, retain, maximize and multiply the value for and of the clients it services.
Too hard? Ok – how about “The purpose of your business is to take money to the bank, reliably, predictably and with the biggest wheelbarrow available?”
“Oh – I get it!” They start to get the idea. Your business does not care what you do. It only cares that you take enough money to the bank for it to be “healthy”.
Same as the bank does not care how hard you worked for each dollar you deposit. Not even a little bit.
So – if we borrow from my genius statement above, and your marketing decisions are based on the goal of measurably attracting, converting and retaining A-Grade clients – then what do we do with the Yellow Pages? And the other lead sources?
Well – I might talk about it in the next newsletter – but it is obvious. And here is a more interesting question.
If you were going to buy a business, would you pay more for one that has a clear recorded history of where its new leads come from and what they cost on average? Probably.
And obviously you would pay more for a business that has a database that has a systematic marketing process attached to it to retain and maximize the value of the people on it? You would have to pay more for it because it would be making a lot more money than one that did not do that. Right?
Here is the ‘Bite’.
Imagine you have had your business for 12 years.
And the “Stupid Pratt” Inspectors come and knock on your business door.
Will they ask you how hard you work for each dollar you bank? Or whether you give a great haircut? Or how grateful you think your customers are?
Nope. To avoid being labelled a “Silly Pratt” – (imagine compulsory embarrassing hat and perhaps a stick you have to carry with a large toy rabbit squeeky toy glued to it.) you will need to SHOW (not just talk about) that:
As a minimum:
1. You know the source and cost of most of your new leads
2. You have collected the names and contacts of your clients, and have made systematically contacted them so as to: A. Retain them as customers and B. Increase their value to you.
Have a great day
Ps – getting new leads is nice and can be fun. BUT – what happens to the level of your bath water when you have the plug out and try to fill it?