Imperial Boogie Marketing Tool Kit Imperial Boogie, LLC http://www.imperialboogie.net Official Imperial Boogie blog In times of recession and in booming economic markets, businesses have a tendency to shift focus from customer acquisition to customer retention. Unfortunately, most business are not skills in either area of acquisition or retention process and less than half of businesses have acquisition plans. The truth is that every business needs to have a balance in both area’s and need to have plans in place to insure the future success of the firm. It is not enough to just have a plan; there must be a clear definition on measuring the success of the plan. Businesses to often implement strategies and use short-term indicators (i.e. Brand awareness or Image) vs. long-term indicators (i.e. market share or profitability) to determine the overall success. These leads to wasteful spending and research have shown that only 9% of business that have acquisition/retention strategies in place are successful. This leaves 91% of business that is wasting money. The key to successful retention programs starts with relationships built with each and every on of your customers. You have heard the adage, "It's not what you know, it's who you know." Jay Rathburn wrote, “when it comes to building relationships, it's all about what you know about who you know.” What do you really know about your customers? How is information collected, stored and what does your firm do with that information? Do you know your customers’ kids names, anniversary, birthdates, favorite restaurant or hobbies? How would you feel about your purchasing experience if the sale person sent you flowers on your anniversary or a gift certificate to your favorite restaurant? Would that make you more or less likely to return to that business? A majority of customer do not buy on price alone and look at companies that stand out in their minds. They are looking for professionalism, customer service and reliability over the lowest price. This means that as a company, you must create experience & relationships will breed loyalty. Rathburn says, “While dealers are often focused on selling a product, the loyal customer is focused on buying a relationship.” What are you selling and what are your customers buying? What do loyal or lifetime customers represent and what do they bring to your business? Normally, they bring referrals, friends, and family members. Referrals are the best form of advertising and IT IS FREE!!! You must build relationships with each of your customers and treat them as a member of your family. Loyalty is build around one simple fact, COMMUNICTION. You must communicate with your customers about new products and services. Up sell them on the features and benefits of your products. Use modern marketing techniques (we will talk about modern techniques later) in order to keep your brand, your image, and your logo fresh in the minds of your customers. DO NOT get in the trap of providing to much information or too little information. Provide a clear precise message to your customers. If you provide too much information to your customers, it is as ineffective as providing to little information. Work with professional to help refine the message you send to the world. Your customers should be treated like royalty, WHY, because they paid for everything in your business. They should get credit for every referral sales and for all the repeat business. Consider the facts that repeat customers typically accounts for an average of 65% of total sales in most industries. Research has shown that repeat customers bought sooner, more often and paid more for products and services. We all know that it cost more to attract new customers than it does to keep your current customer happy. However, do you know how much you are spending to attract new customers? It typically cost between $225-$375 per new customers (industry varies). How could these funds be spent more effectively? In business there is a principle called the 80:20 rule. It simply states that 80% of your total revenue is generated by 20% of your customers. Therefore, minority of your customer account for a majority of your sales. If the game is trying to grow your business, then you must involved in acquiring new customer and getting large buyers to stay. Did you know? • Did you know that young adults spend 40% more time online vs. watching TV o 19.3 hours per week online vs.13.5 hours per week watching TV according to the Youth Marketing Agency • The Annual Tech Tribe Report surveyed 2,800 individuals between the ages of 16-25 year’s ld and found that 25% of them spend at least 4 hours per day online. • 89% of young adults have some form of social network (i.e. Myspace, Facebook, etc…) • 76% of the respondents download at least one song per month • 45% download TV programs • 41% download Software • Wachovia Corporation opens 200,000 new accounts each August to college students and almost 90% of those students signup for online banking. This is compared to the 37% of overall Wachovia home customers even sign up and use online banking. The 16-25 year old demographic is your future customers, what are you doing to attract them to your business? Younger customers have not known a life without using blogs, World Wide Web, e-mails, digital communication and a world without technology. This demographic need immediate access to information, constantly seeking information and requires instant gratification. Over 71% of those individuals will choose the web as their first choice when seeking new product information. How is your website and online presence? Is it viral, is your site constantly evolving and changing? Is your site maximized for search engines spiders to crawl through and seek key words searches? Does your competitor outrank your business on search engine results? Do you know how you can improve your ranking? Lets get back to the point of this discussion, recession and building your business. Most successful businesses plan for recession by increasing their line of credit (just in case), decrease or consolidating debt and trying to reduce overall operating expenses. Inform your employees of all expense so that they are conscious of all the cost of production and profit-and-loss’s of the company. Talk to your employees, chances are, they will help you find the keys to your financial success and boost your sales efforts. Examine you vendors and dump vendors whose prices have increased 20% to 30% in the last year. Really examine the bottom line and make sure you have a plan for coming out of the recession and use this time to steal market share from your competitors. BIG MISTAKE: The first area where most businesses fail is by shutting off adverting and marketing budget. This is one of the biggest mistakes that a business could make. In fact, most businesses should triple their marketing/advertising budget in order to out due the competition. What is your current budget for Marketing/advertising? If you are spending 5% of total sales, then increase your budget to 15% of total sales and work to steal market share away from your competitor. The Doom and Gloom: When the upper 20% of income levels start to feel the affects of a recession, it dramatically affects the remaining 80% of the country. The top 20% of income is defined as individuals that have income over $150,000 per year. These individuals account for 40% of overall consumer spending and make up two thirds of economic activity. Affluent shoppers spending with enthusiasm is the key to getting the economy back on track. A latest government survey found that the top 20% in income spends about $94,000 annually. This is five times as much spending as the bottom 20% and is more than the bottom 60% combined. Bright Light: Riechard A. Weiss, chief investment office and executive VP of City National bank, expresses his thoughts on recession. Weiss noted that recessions since Word War II have lasted eight to 16 months, with an average of 10 months. Worst Case, Weiss Said, is that it extended into the third quarter of 2008. If it last longer it would be a business cycle of epic proportion. “You have to go back to the Great Depression to have a cycle that goes into 2009,” Weiss Said. The economic decline started in July & August in 2007 and we are almost out of this mess. Resent surveys have found that consumer confidence is up over 10% from a month ago and economic stimulus checks are translating into high sales numbers at retail. This increase in consumer spending in a market that is seeing $4 per gallon gas is a bright light. Congratulations, you have weathered the worst. Tidbit: • If you do not treat existing customer with excitement and enthusiasm, I can assure you there is another company that would be delight to do so… • Customer Retention requires an ongoing commitment 7 Commandments (according to Adam Hudson) 1. Commitment – You didn’t win your husband or wife with one call, poster card or print collateral. Customer expect, deserve, and demand your time, attention and commitment to the relationship 2. Keeping Your Word – If you say your going to do something, do it. 3. Thank you Cards or call after appointments or meetings. It is a 42 cent expenses or a two minute call that will dramatically change your ROI. 4. Customer Survey Card – How are you going to improve your business if you don’t know what your customers are saying and think. Getting customers survey’s after each project or job is much easier than trying to get their positive feedback at the conclusion of your relationship. As you know, clients tend to forget all the amazing things that you did for them and only remember why the relationship ended. 5. Referral Request – If you go above and beyond for you customers, then you have earned a referral and have every right to ask. Most customers will be happy to give referrals. This can either be e-mailed or mailed 30 day’s after service has been provided. 6. Customer Newsletter – This is the #1 tool for regular retention. Send them two to four times a year or monthly. Physical or e-mail, keep your business/logo in the forefront of their minds. 7. Birthday Reminders – Anniversary of your service, your customer birthday or the birthday of your business. Conclusion Recession are the time the business need to examine what they are doing correct and most importantly, what is your competitors doing correct. Invest more into advertising/marketing, research & development and put your company in a position to steal market share from your competitors. Use modern marketing techniques, customer retention management (CRM) software and communicate your message to the world effectively. Remember that you cannot only cater to your current customer base and you need to focus on your future customers. How do the younger generations receive information and what steps can you take to get their business in the next couple years? Most importantly, if you need help in any or all of these area’s, call Imperial Boogie and let us help grow your business. Our objective is to help you make money, not spend your money. © Imperial Boogie, LLC
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