Business
When you limit your Business to doing things the same way every other Player of your does, you can only produce modest, increamental gains at best
Most business people don't realize it, but they are in the client and prospect generating Business. Thats the basic goal Of marketing
Break Through
Breakthrough are unconventionally fresh, superior, more exciting ways of doing something.
Ask your self Continually" Where's the big overlooked opportunity here?"
always discover the hidden opportunity in every situation
Try to uncover at least 1 cash windfall for your business every 3 months
Build a foundation based upon a multiple streams of idea generation. Get Ideas from others
One of your break through Goals is always to make your product or business special, unique + more advantageous in your clients eye.
Breakthrough increase in direct proportion to the amount of networking brainstorming, and masterminding you do with like minded, success driven people outside your industry.
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4 Ways/Components To Increase BUsiness
- Increase The Number of clients (Increase Market Share)
- Incrase the average size of the sale per client / Increase the value of each transaction (Increase Customer Share)
- Increase the number of time clients return + buy again / Increase the number of times an average customer buys per year (Increase Customer Share)
- Reduce Overhead Cost
If sales turnover Equals Rp.100.000.000.- Per-year, the three ways to grow formula can be broken down into :
- 25 Customers
- Who spend on average Rp. 500.000.- per transaction
- and Buy 8 times per year
The three components to grow a business model is so simple but so powerful and effective because :
- Breaks the focus on increasing by attracting new Customers. The idea of selling more to existing customers is opened up and the success Of this strategies for many times has show that most companies do not Maximize their Opportunity with existing customer. this is often the source of hidden profits. The potential is probably already in your business, it's just a question of whether you will take the action to capture them.
- The model creates Exponential, geometric growth. Increasing each factor by 10% generates 33% total growth. Increasing the three drivers of growth by 20% each creates 72.8% growth. Others try to grow the hard way by focusing on increasing the number of customers. And we must Understand the profit can be increased more quickly and easily by focusing attention on your Existing and Past Customers.
- Start by setting up referral systems, create a guest book to capture names, ask your current customers for three referrals,
- offer free or reduced price incentives to new customers to acquire them for years to come. Use contents and drawings,
- mail to the lists of other business that have similar customers but do not compete with you directly.
- Call inactive clients encouraging them to visit you again.
- Can you market to the opposite sex of your core business more effectively?
- Use all forms of :
Develop good headlines, copy body, and generous offers.
You want to create Attention, Interest, Desire, and Action (A.I.D.A).
- Now set a goal to get X amount of new customers and measure your progress by sales figures, body counts, coupon redeemed, new names acquired, find out how they heard about you and track your advertising dollars and results.
2.Incrase the average size of the sale per client / Increase the value of each transaction (Increase Customer Share)
- Use Risk Reversal with unconditional money back or better than money-back guarantees. When clients have nothing to lose, your performance soars.
- Hire super sales people who use scripts to sell with proven methods.
- Up-Sell your customer by giving them an opportunity to add options to upgrade to higher better services or products,
- Cross-sell by offering products or services that enhance the value, function or performance of what they have already bought.
- Educate your customers by creating reports, guides and newsletters which educate them to buy and use your products or services, offer more products and services to choose from.
- Ask yourself what are people spending money on now? Offer that product or service; create irresistible offers that people cannot refuse. 2 for 1 , Buy 2 get 1 free, coupon books, discount gift certificates, have surveys that ask customers what they want then go get it and sell it to them.
- Motivate your employees to sell more through profit sharing, incentives, rewards and recognition programs.
Lead your customers to what they need by listening to them.
Do you have or give sales training, do your sales people use scripts,
and can you list 7 things to offer every customer you have? Make a list and offer your best benefits, products, services and programs, offer higher quality, a larger plan, extended warranty, an extra way at 1/2 price to your customer.
This is add-on-up selling that generates additional value to that particular selling event.
Action Excersise :
Name the most profitable part of your business ?
Do more of that.
Make it easy for your customer to buy from you.
Remove the barriers and give further incentives for them to buy still more.
3.Increase the number of time clients return + buy again / Increase the number of times an average customer buys per year (Increase Customer Share)
- Your first step is to know who these people are. You must track, capture and manage your existing customer list, who buys from you, who has bought from you, what do they buy and why. Get your list together, names addresses, phone numbers, and e-mail address. It is absolutely critical that you have a list of who buys from you!
- Direct mail is the key to using your list to its maximum potential.
- Using the phone to follow up after sale is your second best use of the list.
Your first step is to compile your list, computerize it with tracking programs, like Goldmine, and file Maker Pronto, or Excel, Even if it is just a computer database by alphabet that is sufficient.
- With your list, you now have the power to mail special offers, newsletters, reminder cards free reports, information, thank you notes, calenders, referral vouchers, surveys, samples, 6 times a year as a minimum. You should contact your current customers.
- The phone is used to follow up after the sale, to reassure them and thank them after the sale. Also this allows you to ask if there is anything else you can do for them, while finally asking for their referrals.
- Trade the list and/or endorse your co-venture partners, now you have the valuable asset. In fact your list of clients or customers is the most valuable asset of your business, because if you don't have any buyers you have no business. Your list is a goldmine and use must use it to its full potential.
Using your list, Let me give you an example of how to trade or exchange your list. Let's say our charter boat captain has 500 customer name on file. Lets also say, he writes a nice letter that tells how nice this bed and breakfast is in town that he knows about and that with his letter, this bed and breakfast will give his valued customers something for free, a discount, preferred service, or some bonus.
Now the bed and breakfast operator is given permission to mail that letter to the captain list of clients. This can be huge for the following reasons. The captain's customer already trust him. His customers get a special value deal, the bed and breakfast gets a warm lead endorsement to a non-competing complimentary similar customer base and new relationships and business are generated for the cost of a letter. Now the bed and breakfast does the same for the charter boat captain, and everyone wins.
That is an example of trading, sharing, selling or endorsing using your list. You give added value to your customers and you get more customers by using your list in non-competing complimentary ways.
This is also a form of stealth marketing because your direct competition doesn't see or hear your marketing effort at work.
They don't see ads or hear radio or anything else. Meanwhile you're not paying and spraying to attract attention. You are laser beaming to a warm, targeted prospect, while you come endorsed through a trusted friend for less than Rp.10.000.-
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Targeting with Direct Mail
targeting means to define who your best potential customer is and going after them with strategy and tactics to acquire more or new business from them.
Who need what I sell ?
Who would buy or use more often ?
Who can afford what I offer ?
Who needs it, Uses it, and can Afford it?
(Dream Customer) What do you sell, service, offer or do?
- Using your U.S.P. to define yourself and your market.
Questions:
- What is the core activity or philosophy of your business?
- How do customers get the highest and best value by buying from you?
- What do you offer that no one else can compete against you on?
- How do you personalize ultimate solutions to your customers problems?
- How do you save their time, moneym relieve stress, fear and pain give them a safe, secure, happy and trusted emotional feeling if value.
- Always try to personalize your products & services.
If I could choose 100 people or companies to have as my customers,
who would they be ? tailor your solutions to their needs and offer risk-free trial offers to get them to try you now.
The quickest wins and boost to profit can be cut your overhead costs.
First of all you must made sure you knew your financial position and identified all your costs.
The First step in the turnaround plan is to stop the bleeding of unproductive time and money and the second step is to reduce your strees by dealing with your problems and knowing your heading.
When you put your cost cutting plans into action and you speak to your creditors. Make no mistake. You have to make hard decisions, take action and live with the consequences. Cost cutting is never pleasent but you will feel purged.
If you are serious about turning around your business cutting cost is 100% necessary. It is much easier spending money that earning it and that's why you need to go back and review your Costs. In a business turnaround situation saving Rp. 10.000.000 of costs in a month is just as good as earning an extra Rp.10.000.000 of margin fro your sales.
You will not survive if you don't stop the bleeding of cash and wasted time.
Stop Incurring innecessary costs and anything else which doesn't give you an immediate payback. When you are fighting fro business survival with possibly only a few weeks to go, the "must go to" exhibition in six months time doesn't matter. These are the type of costs you have to cut, the "nice if's" well as the wasteful and extravagant costs.
Take each cost in turn and ask yourself, "knowing what you know now, would you still start incurring this cost?" If not you have identified a cost to be cut.
In the cost cutting phase you only have three options :
- Keep it.
- Reduce it.
- Stop It.
Can you stop the contract with the cleaning company and ask your own team to clean their areas? is this the best use of their time? Will it retain their goodwill and serve as an example of the stringency measures required? what are the consequences if some people take up the cleaning chore and do it but others don't?
If you decide to keep office cleaning but to reduce the cost can you:
- reduce the quantity and move from cleaning every day to three days per week?
- Reduce the quality so that certain cleaning tasks are taken out of the scope of the work?
- Reduce the cost by negotiating a lower rate per hour?
Now is not the time to be trying to carry passengers and it's not fair to your other employees who rely on their salaries from you.
You have cut costs and may have admitted your problems to all the business who depend on you for payment. It is likely that you will have heard tales of hardship and how your actions are ruining the dreams of employees and putting your suppliers business at risk.
But you can look yourself in the eye when you see a mirror. You are facing up to your difficult circumstances, you are taking action, you are being honest and you are dealing systematically with your responsibilities.
So that's why it's very important to stopped the bleeding. Without reviewing your costs and cutting out the non-essential items, you are forcing your business to carry a heavier weight and you are reducing the likelihood of a successful turnaround.
After you reduce the cost. Your stress levels should be lower. People know the situation and can make their own informed decisions. You can move on to thinking about how you can find your cash injection to give you more breathing space.
Three Ways To Grow
But that is overwhelming. You can't cope with thousands of ideas.
The power of Jay Abraham's 3 ways to grow a business model is in the power of simplifying the issues down to three very easy and understandable concepts.
- Increase the number of customers
- Increase the average transaction value
- Increase the number of transactions per year
Common Mistake When Growing A Business
They are not conscious of it but they ignore the potential for extra sales and profit from the second and third ways to grow a business.
Jay's incredible record for profit improvement is often based on his success in leveraging the amount customers spend and the number of times they buy for easy and quick wins.
Implementing The 3 Ways To Grow
- Establish your baseline - essential to know where you are starting from.
- Assess your potential for improvement in each of the ways.
- Identify the current methods you use for increasing business in each of the three ways to grow.
- Rate each method for effectiveness and return on investment. This helps you to decide whether you should be optimizing existing methods before adding new methods.
- Brainstorm new ways to grow your business.
- Review, rate and prioritize
- Plan your implementation
- Implement
- Test, measure and optimize
Ways To Grow Your Business #1 - Increasing The Number Of Customers
Let's break it down.
The number of customers is a function of:
1 - the number of customers you have at the moment
2 - the number of leads from prospective customers you attract
3 - the rate you convert leads into customers
4 - the number of customers you lose.
Improving Retention
Working back up the list, if you are currently losing 20% of your customers per year and you can implement policies to stop half of them disappearing through better service and improved relationship management and communications, it is the equivalent of getting an extra 10% of new customers each year (20% loss * 50% improvement = 10% lost and now 90% retained.
Growing by improving your retention rates does not require expensive and risky advertising and can be relatively easily improved when you start focusing on why customers are leaving.
Improving Conversion Rates
The next easiest way of growing your business by increasing the number of customers is by improving lead conversion rates.
You have two areas to improve conversion rates - immediate and follow up.
If you improve the sales skills of your staff who sell so that they focus on what the customer needs and wants, you should increase the number of customers you create early in the sales process.
It has also been shown that most sales people give up too early. Sales staff should try to close if the customer appears ready to buy but if the customer isn't ready, you need a way to educate the customer and to build the relationship until they are ready.
Research indicates that the majority of sales people give up after the first or second No but the majority of purchases are made after four or more contacts.
Attracting More Leads
The final way of growing your business by increasing the number of customers is to attract more leads from prospective customers.
That means either or both
1 - more effective advertising. Jay Abraham advocates optimisation and the need to continually test for better, more effective ways because improving marketing can create great leverage. If your advertising creates 10 leads per week, a better headline and more persuasive offer may generate 20 leads without any more cost.
2 - more advertising & promotion. Jay recommends the Power Parthenon where you should have multiple sources for leads so you are not reliant on just one.
Ways To Increase Your Business #2 - Increasing The Average Purchase Transaction Value
Increasing Your Prices
First there is the basic option of increasing prices.
It is easy to think that your customers decisions are dominated by price - and they may be giving you that impression - but repeated tests have been done to show that it is not true.
How often do you buy more expensive things out of personal preference, convenience, availability and confidence in the supplier.
Tests may show your customers are willing to pay more - and even if you lose some business, it still may be much more profitable as price is the number 1 driver of profit. For more details see my page Increase Profit
Upselling and Cross-selling
This is a big subject but your customers may be delighted to be offered the chance to buy something better (an upsell) or something related (a cross-sell).
Think of McDonalds and the classic questions "Do you want fries with that?" and "Do you want to supersize it?"
It is said that about 30% of people agree and that is extra profit on the transaction.
Look around you for other examples of where an extra offer is made at the time of buying and see what you can learn and apply to your busy.
Ways To Grow Your Business #3 - Increasing The Number Of Times A Customer Buys
This does require that you do a good job and deliver on your marketing promises and then keep in contact with your customer.
Your competitors are probably talking to them so if you stand back and think you have their business, you could be sadly mistaken.
Or you may think that your customer will remember who gave them such a great service last time and that they will come back to you when they need more work done.
But is that really what happens?
Do you go and buy from your trusted supplier who is ignoring you or do you try out the new company with the eager salesperson who wants your business?
If you don't have a regular customer contact program, you need to implement one to make sure that the customer is as satisfied as you thought and to keep your business in their minds.
I have been going to the same dentist for more than ten years but I only think about having a check up when I receive the six month check-up reminder postcard.
I used to have the house burglar alarm serviced every year. They used to send me a reminder letter but one year it came about a week before I was going on holiday and I didn't have time to fix the visit before I went away and I knew the alarm worked. The cycle was broken. They thought I wasn't interested but it wasn't convenient and then I forgot.
They lost the service contract and I saved a bit of money.
About three years after we had a problem and I called them in and they never tried to put me back on the service contract. I would have probably agreed but they missed the opportunity to make sure that I continued to buy from them.
Have You Used The Three Ways To Grow A Business Model?
Do you have any ideas or tips to pass on to other people about how you have managed to find new ways to grow by using jay Abraham's three ways to grow a business model?
Increase Profit By Increasing Your Sales Volumes
There is a tendency to over-complicate so let me start by introducing you to Jay Abraham's three ways to grow a business model.The Three Ways To Grow A Business Model
You may be thinking "There are thousands of ways to grow a business. How can the world's highest paid marketing consultant say that there are just three ways?"
The answer lies in the arithmetic and it will make more sense when I explain that the three methods are:
1 - Increasing the number of customers
2 - Increasing the average transaction value
3 - Increasing the number of times they buy
This may make more sense if I work through a numbers example.
Imagine you had a business with sales of $1000k per year.
Quick investigation shows that you have
1 - 200 customers
2 - spending on average $5,000
which when broken down into individual transactions you learn becomes
3 - 5 purchases per year at an average of $1,000 per transaction.
So the $1,000k = 200 customers x £1,000 average transaction x 5 transactions per year.
Pretty simple isn't it but don't make the mistake of dismissing it as obvious.
When many businesses think about increasing their sales, they immediately start thinking of ways to attract new customers but as the Jay Abraham model shows, there are two other ways which are often overlooked.
What is interesting is that the average transaction value and number of transactions may offer far greater opportunities for improvement than trying to increase the number of customers.
I have seen various statistics referred to but it is said that it is 6 to 10 times easier and less expensive to sell to an existing customer than it is to sell to a new customer.
Even working interesting is that if you can work on all three levers at the same time you get the power of geometry to create exponential growth.
Remember the initial example of 200 customers making 5 transactions of $1k per year.
Suppose strategies are found to:
1 - Increase the number of customers by 20% from 200 to 240.
2 - Increase the number of transactions by 40% from 5 to 7 times per year
3 - Increase the average transaction value by 30% from $1k to $1.3k.
20 x 7 x 1.3 = $2,184k an increase of over 118%.
This is the power of the model.
If you don't focus any attention on increasing the average transaction value and the number of purchases, you could be missing out on a fortune.
The Strategy of Preeminence
Before looking at the three ways to grow your business and increase your sales volumes in detail I want to explain a core Jay Abraham philosophy called the Strategy of Preeminence.
Forget sleazy sales tactics and focus on what is in the best interests of your customer.
What can give your customer the benefits and result they most want?
For example in a recent video, Jay Abraham explains that he has an indulgence for having his hair cut every 10 days to maintain his appearance the way he wants it.
He explained this to his hairdresser and gave his hairdresser tips on explaining the effect on appearance of delaying a hair cut. Since customers want to look good, the hairdresser was acting in accordance with the strategy of preeminence of looking after their best interests.
The new strategy resulted in the average number of visits per year by an average customer increasing by three.
Increasing Leads From Prospective Customers
To attract more prospective customers you either need to do more marketing and advertising so that more people see details of your business and offer or to make your advertising more effective.
To increase profit, my advice is to improve the effectiveness of your marketing before you spend more money. You should make your marketing compelling with an irresistible offer which target customers want to buy or at least know more about.
Top direct marketer and copywriter Dan Kennedy is offering a two month free trial of his No BS marketing letter - well worth trying.
Increasing Sales Conversions
If you can change the rate you convert new enquiries into new customers, you get an immediate boost in sales and profits which is multiplied by your actions to increase future sales.
Changing conversion rates from 1 in 5 to 1 in 4 gives you a 25% increase and you can do it by improving your sales skills.
I have looked at a lot of selling systems over the years and disliked many of them for sleazy sales closing techniques and manipulation although I have heard many times just using any sales system can have a big positive increase and lead to higher profits.
The best selling system I have seen is the New Game of Selling by American business growth expert Mitch Axelrod. It's not the best known but it is a highly ethical and effective way to sell which has generated over $2 billion of extra sales.
Increase Profit By Increasing Prices
I am fascinated by the role of pricing in business and believe that price is the number one biggest driver of profit and its critical importance is missed by many business owners.Do you sell a commodity product or service or is it (or can it be) differentiated from your competitors in any way?
Too many businesses fall into the trap of thinking that price is the number one purchase criteria with their customers. Research studies show that selection, service, quality and confidence in the supplier are usually more important. Unfortunately this means that they undercharge and earn lower profits than they could.
First let's bust the myth that everybody buys everything on price because until we do, you won't see price as the lever for increasing profit.
Look at your own purchases - your clothes, your hair cut, your car, your lunch - can you think of anything you buy just on price? And why are you willing to pay more for other things?
Now look at your toughest competitor, the most hard nosed negotiator you know and do the same exercise. Can you see the evidence that they always buy on price?
I could write a lot about differentiating your product but I don't have the space. You need to see what you sell as different from your competitors so that you can persuade customers it is different. The Irresistible Offer is definitely worth reading.
To increase profit you need to move away from the price you charge to the value you provide and as you found with your clothes and car, value comes in many different criteria.
You may be self sabotaging your profits in your price negotiations. I hear it a lot when I am buying when the sales person says "my normal (or list) price is..." It tells me that there is room to negotiate and if I am buying, I want it at the lowest price.
Price is where the rubber of your business strategy hits the road and is a massive factor in your business profit. If you want to increase profit, you can't afford to ignore the increase price option.
Method 1: Gain new customers or clients
Method 2: Increase the profit level of the average sale
Method 3: Increase repeat business
Pretty simple, right? Yet, in our experience in consulting and advising many businesses here in New Jersey and from across the country in their marketing we often find that about 99% of them have this belief in common:
"To generate more money for our business, we must market or advertise to gain new customers first and foremost."
I am not saying most businesses neglect repeat business. However, it never seems to be emphasized enough, and certainly not nearly as much as marketing to gain new customers.
Now, if you are a completely new or start up business, you do need to focus all of your efforts in gaining new customers. However, if you are more established and at least have a customer base, whether large or small, you could very easily be sitting on profits that are going ignored.
Here's a quick example of a project we worked on last year. One of our marketing consulting clients here in NJ wanted to increase their sales. After analyzing their records for the past 2 years I determined that over 70% of their 3,000 customers used them once and then never came back again!
We quickly developed a "back-end sales strategy," or better known as a repeat business strategy. I assured them that follow this program for 6 months to a year and do not be surprised if your business doubles or triples in sales growth easily! To date, I hear things are going quite well for them.
So if you have been in business long enough to have a customer base, whether they are still actively buying from you or not, figure out how many come back often. Find out how long its been since many have come back again.
Do you even have a reason for them to come back? What can you offer them as an incentive?
Here's why marketing for new customers is usually NOT the most cost effective way to generate new revenue both short term and long term.
Marketing requires resources (time, effort, energy, and money.) When aimed at gaining new customers, it requires much more in resources to accomplish significant results.
Think of it like this: How much do you currently spend on marketing to attract new customers?
If your marketing budget was $2,000 a month and on average it brought in 20 customers who spent on average $200 each, you are essentially spending $2000 to bring in $4000 resulting in a net of $2,000. Of course, for retail business and product sellers, their profits margins may make this even less attractive.
However, what would it take for you to bring in 20 new orders a month to an already existing customer base? Maybe if you sent out a mailing costing about 50 cents each to 300 old customers, 20 would respond. In that case, it cost you only $150 to bring in the same $4,000 in revenue.
This couldn't possibly be more relevant now than ever before. With a down economy right now and a war going on as I write this during April 2003, more and more businesses are facing the "pinch" of having to spend less, yet produce more.
So my advice to you is to focus more on your existing customers.
Now, what else can we do to quickly generate higher levels of revenue for you?
When a customer or prospect is about to do business with you, can you offer anything else to the order or sale? Can you include an "add-on" product or service? If you can, you can increase the average profit level of each sale!
Now, for that equation I promised you. Take out a piece of paper and write this down:
Number of prospects (potential customers)
MULTIPLIED BY
Conversion Ratio (Out of every 10, how many buy?)
(This would give you the number of actual customers)
MULTIPLIED BY
Average Sale Price
MULTIPLIED BY
Average number of repeat purchases
EQUALS
Your Total Revenue
Then fill in your historical figures. Which area can you improve upon the best in?
Are you lacking in enough leads or walk-in traffic or hits to your website or phone call inquiries? If so, ask yourself how can you improve the response to your marketing. If you are not doing enough or any marketing, get started!
Are you getting calls and leads from potential customers, but for some reason you are not converting enough of them into paying customers? If so, ask what is keeping people from doing business with you? Better yet, ask them why they went elsewhere. If that's not possible, or applicable, look internally. How do you compare to the competition? Are your employees or yourself well trained and capable of handling customers' questions and concerns?
What's the average price or profit level per sale or business deal for your company?
This figure can be calculated by dividing the total number of orders or sales into the total revenue for any given time period.
If this figure is smaller than desired ask yourself how you can increase it. Honestly, some businesses can legitimately get away with charging more for their services or products. They may have been charging less than the competition since they were a new business and wanted to be competitive. But now since they are more established they can charge more along the lines of the "going rate." Other businesses can differentiate their products, services, or company on quality. In that case, communicating this to your customers can warrant a higher price.
Or as I mentioned earlier, can you include anything else to the sale for a higher profit level?
Finally, how many times does your average customer use your services or buy your products? If you don't have this information, start getting it. It's easier to get than you think and is very important to have.
If you do have it, just divide the total number of orders or sales by the total number of customers for a given time period to get this number.
If this is lower than desired, there are many questions to ask yourselves. Is the quality of our customer service lacking and sending people away? On the other hand, is there anything else we can offer our customers? If so, do they know about all we have to offer? If not, how we can let them know?
So there's a lot of information and a lot of questions to ask yourself about your business. Whether you are just starting out or you are already an established business just looking to continue to grow, these are some important considerations.
That formula of the 4 Parts leading to your total revenue can provide a very useful guide to determining just where you "drop the ball" or what can be improved upon.
3 Ways To Grow Your | |
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Raising Prices Raising prices is far too undervalued. Yet just 5% might be enough to add 20% to your profit depending on your costs and margins. Your customers may not even notice or question small increases. Before you raise your prices, think about three things... First, how ‘price-elastic' is your market? Do buyers respond negatively to the smallest rises and show no loyalty? Second, how educated are they about how you differ from your competitors? Do you offer tangibly more? Do you explain more? Transact better? Third, how can you test price rises in small ways? Small changes that can be credibly explained to customers are recommended. Raising Minimums and Measurements Another related exercise is to raise the minimum quantities or the units of purchase. Change your minimum order value, your minimum cup size, the minimum term of membership, the number of recommended visits, or the minimum number of rooms you'll service. You’re still offering great value for money, but now your average transaction value will be increased Referrals Referrals are the last idea we'll introduce here. Referrals should not be accidents. Every transaction should be as customer-lavishing as possible, so you can leverage that transaction. Actively soliciting referrals gives your customer a chance to see a friend or associate receive the same treatment they just received. It gives you a chance at doubling the value one customer represents to you. One of the best ways we've seen of soliciting a referral, which can be a very difficult exercise... is to just ask for it. Ask for one referral from every customer you dazzle and you’ll start to see real results. The Third Way To Grow Your Business Faster: Get Your Customers Buying More Often Dialogue Before we list anything exotic and complicated, let's be reminded that if 68% of customers are lost because they perceive you are indifferent to them, then surely the cheapest way to get them transacting more frequently is to avoid that perceived indifference. If you have few customers, then call them periodically. If you have many customers, send them something written at least quarterly. Emails are tempting because they are so cheap, but real live letters have impact. If you don't keep a database of customers, start one using anything from a simple spreadsheet to a dedicated Customer Relationship Management package. Sending monologues is a start, but soliciting feedback and offering a dialogue is better because you learn something and your customers appreciate being asked. Try to keep your dialogue to about once a quarter. Monthly is a bit much for most customers. Direct Reminders An extension of this is what good hairdressers and dentists do all the time, by pre-booking your next appointment and even reminding you when it's approaching. Service-based companies can do this more easily than product-based companies, but not exclusively. While it's easier to remind someone their car needs servicing, lawn needs mowing or house needs cleaning, it's also quite possible to remind people their birthday, parent's birthday, or anniversary is approaching. Execute your reminders at two places - once right after they've purchased from you and have therefore had a pleasant experience with you; and once again a week or two before your suggested purchase date (their birthday, or when the car service is due). Programmes and courses A way of pre-booking and even sometimes pre-selling multiple transactions is to put them into courses or programmes or other ‘lumps'. Service-based franchises gain a lot from this. If you sell a once-only cleaning event, your cost of acquiring that business is prohibitively high. So make your new-customer acquisition dollars gain multiple sales, by selling monthly cleaning packages with obviously better value. Sell them up front, or arrange an automatic debiting system. This principle applies to most services and can also work with food and beverage. If Friday night's a great night for football, it's a good night for fast food too. A season's pass to pizza at mates' rates is going begging. Lock-in those sales in advance and you'll also find planning and management around fiscal matters becomes much easier, as does the sale of your business. Loyalty and rewards Loyalty systems can be simple or expensive. A simple repeat purchase card that gets punched, stamped or signed is enough. But magnetic or barcode based systems also return good dividends. These systems also allow you to record what gets purchased, so you can fine-tune your dialogue with customers and offer them something you know they'll appreciate. If you explore loyalty systems, try also hooking up with suppliers of complementary products and services. For instance, if you sell domestic cleaning services or products then offering discounts to home-related products and services is relevant and tuned in well with your customers, and is likely to do well. If you sell food to the younger set, then consider alliances with providers of sports and fashion products. |
Option #1 – Increase the number of customers
You increase the number of customers you have by reaching new customers 1) with your existing offering or 2) developing a new offering. Ideally you will leverage the offering you have to enter a new market or expand the reach in your exisiting market. Three key questions to answer to increase the number of customers are:
- Who has a real need for the product/service I’m selling? Does my product meet that need in a manner that either saves money or provides additional value?
- How much, if anything, are they spending to address that need today?
- How many of those potential customers are there? How do I reach them?
For example, our company just completed a national market research study that provided our client with the issues and challenges facing its target market. Using the research, which provided a keen understanding of the needs and wants of its customers, our client developed messaging and marketing materials that resonated not only with existing customers, but with new customers as well. Response rate to their lead-generating events have doubled.
Option #2 – Increase the frequency of purchase
The quickest path to increasing the frequency of purchases is by making it as easy as possible for your existing customers to do business with you repeatedly. Another way to look at this is providing additional customer value – and ultimately building customer loyalty. If you make it easier for customers to buy from you, relative to your competition, then you will continue to win their business. This, of course, assumes your products or services are comparable or superior to your competitors.
Outside of customer loyalty programs, here are a few areas to consider improving:
- Responsiveness to requests, calls, emails
- Accessibility to the customer’s primary contact
- Consistency in offering
- Follow-up and follow-through on meetings
- Accurate and timely billing.
Option #3 – Increase the number of units sold
By default you will increase the number of units sold when you increase the number of clients and frequency of purchase. But you can also increase the number of units sold by understanding how to add value. If you want to sell more products or bill more hours, providing a value-add benefit or solution will begin to strengthen your customer relationship. If you are to consistently add-value to the customer relationship, you need to fully understand how your customers interpret, define, and quantify the value they receive from your products and services.
Here is a consumer example: A restaurateur offered existing customers 20 percent off for parties of 4 during lunch and early dinner. The idea was to add value to his existing clients by providing them with a benefit they could share. Result: His lunch business went up by 88% in one month and by 53% over the campaign. On the frequency side, he experienced 71% retention of his customers when he dropped the campaign after 3 months.
Finally, don’t forget, to see real results, you must start with what you already know about your customers. It is the market research, customer knowledge you already have, that is literally a hidden goldmine of profit that can grow your business and increase your company's top line. It is this customer-focused information that will provide the foundation for generating more sales, retaining and cross-selling customers, and acquiring new customer business. Armed with customer-focused information, you will know which is the best way to grow your business.
Start by building your core story according to your philosphy. It is proven that when you are the spokesman for your company you will hav e 30% higher response rate to your offers.
You should write your job description so that anyone could follow it. Ask your employee to write their also. When you review what your employees think their job is, look for miscomunication in what you see. Often, you and they are miles apart on what you expect. it will helps you to define a policy with clear rules and procedures. and Every employee should be able to explain every other employee's job to some degree.
Are you working on your busness or in your business?
Serve Customers
Order Stock
Sell & Transact
Schedule, Perform, or Deliver Product or Service
S / Self Employed
All the above plus :
Payroll, Taxes & Insurance
Planning
Advertising
Personally Representing the Entire Enterprise
B / Business Builder or owner
Organizing & Financing the Business
Defining what the business does
Hiring other people to manage it
Structuring for long term growth or sale
Monitoring the operations
I / Investor
Financing the ventures
Investigating overall productivity
Monitoring Returns On Investment
Either increasing or decreasing cash provisions
Reallocating or diversifying as required.
It is in most cases best to be in the B or I quadrants so as not to lose sight of your mission, goals, objectives and purpose. Otherwise you can become an overworked, bogged down slave to the grind. Just be aware and delegate unproductive activities. Stop and take time to work on your business, not in it. Ray kroc did not build Mc Donalds flipping hamburgers himself !!!
Using Surveys
First Survey yourself by answering the question that apply to you in this report. Then survey your employees asking them what they think, see, feel and understand realting to your business. You will do well to ask for their ideas on how to improve as well.
Provide after the service, exit surveys that ask your customers multitudes of questions that are aimed at getting any information you want, if you ask! people will tell you what you want and need to know.
When you have answers to the questions above then you can ask yourself what you can do to achieve even higher and better results. A simple question to ask is how can I right now raise the quality of my product or the level of service that I offer?
You will need to set goals that are Sprsific, Measurable, Acceptable and Realistic. Involve your employees through motivation and incentive programs, training programs and one hour a week company meetings that discuss and review your current strategies and tactics used to accomplish your objectives. Gather, quantify and measure your result and the act upon the data that you have found.
I'm leading towards strategy here, but these are really goals.
My goals are to out-think, out-plan, out-promote, out- service, out-smart. out-sell and out-earn my competition, while under-promising, and over-delivering to my customer or client, more benefits, protection, advantage, savings, security, productivity and satisfaction.
In order to achieve those goals, I will use a strategy which attempts to educate my employess to help me turn customers into salesman. Develop U.S.P and C.B.A., co-venture with other business, watch my competition, advertise under the radar screen, define my customers, educate them and get referrals, test measure and define the best practicesm reduce operating costs and use risk reversal, all in an effort to better serve my customers and clients needs, wants and desires more efferctively.
Now the tactics to use to implement that strategy are :
Define the customer, build or complie the mailig list, get referrals, give samples, discounts, special offers and guarantees, provide free valuable information, that educates my customer, recognize, adapt anf adopt Other players best practices, use a referral cards that equal discounts to the new users, capture names through contests, promotions, drawings, coupon redemptions, application, guest registers, co-venture and trade lists, then use e-mail, phone, fax and letters to personally connect with those people, while strategically placing cards, brochures, and discount offers at other locations to drive more traffic to me!
Hmmmmh....If that doesn't work, nothing will, so goals, strategies and tacticts really will make a difference in how succeeful we are, but it's the little things that can make the difference. This next section is on general advertising methods and the nuances of human relations.
When you use public advertising you are also announcing to your competitors what you do and how you are doing it. This is the essence gives them a chance to counter your offer, duplicate it or modify their ads in some way in order to cancel you out. Radio, TV and Newspaper ads are expensive and generally are a pay, spray, pray form of broadcasting your message.
I prefer to zero in on special segments of the population or my target audience and give them special incentives and discounts to encourage new business. I don't throw money to the wind. I use the ad budget to enhance value directly to qualified leads and current customers. (Word of mouth does the rest)
My competition generally never knows what hit them untill it's too late and by then I have more loyal customers than i really need. This is relationship building based on performance, trust and value. That being said, you are going to have to work, smarter and harder than your competition to provide superior performance, value and benefits to your customers.
Your job is to solve your customer or clients problems, to make sure they are 100% satisfied, and to follow up with them to insure it.
Do you look after your customers as if they were family? Do you remember their names, smile and greet them at the door when they come in, offer refreshment and ask them what brings them by today. Don't ask can I help You? Ask what brings you in today? It gets them talking and you don't get the standard reply of : oohh... I'm just Looking.
Instead of using newspaper ads with icons, dollar signs, color borders and bold text, why not use personalized letters, with discount offers and vouchers to be given to friends, encouraging them to try your service or products out on a risk free, and special offer basis.
Try sending different letters to different existing clients, using different offers, headlines, discounts and specials. Measure the response rates of your tageted mail offers, you might provide articles, pictures of staff, referral promotion winners or valuable information that educates and endears your customer to you.
By using direct mail, you can gain market share without revealing publicly that you are on a mission to grow your business, give them a service blitz, and risk reversed guarantees, discounts, with irresistable offers. Use pass-long coupons and referral cards to get new customers.
Here again, find a way to pay your exisiting clients for new referrals. These are warm leads and proven to be your best source to sell to.
Anwer these,
Do you currently have, use or do the following:
Do you have :
A marketing strategy?
A goal and measurement process?
A referral program?
A current customer list up-to-date on file?
A unique selling proposition defined?
A list of 7 things you can offer using a script?
An employee incentive/training program?
A policies and procedures rules and guidelines manual?
A sale superstar at the front desk? And on the phone?
A company meeting once a week to plan, measure, strategize, and execute your ideas?
Do you use :
Direct-mail, Phone, Fax and E-mail in marketing?
Tracking or computers to update mailing lists?
Sales letter with special offers to get people come in?
Risk reversal and guarantees to remove customer fear?
Other businesses to promote you by endorsement, referral, co-venture list trading?
Surveys to get answers and information that you need?
Use contents, promotions, coupons or special offers to get new business?
Strategy and tactics to achieve your objectives?
Word of mouth advertising to generate warm leads?
Stealth marketing techniques to avoid detection and save money?
professionals to help you implement new campaigns?
Do you do the following :
Count and measure customer activity?
Network with other businesses and co-venture?
Offer tactical incentives to generate more business?
Mail out letters at least 6 times a year, track, measure and test response?
Follow up with customers after the sale?
Look after employees and clients as family?
Have goals set for the future progress?
Cross-sell, up-sell, and re-sell through backend customer contacts?
Stop to work on your business, not in it. (Plan, strategize, use tactics).
Capture and file every new name that you acquire?
Always greet your customers by name with a smile within 15 seconds of entry?
Watch, adapt and adopt your competitors best practices?
Write an advertisement that grab the reader with benefits? Do you make it easy to buy products and services that people want?
Keep your employees informed and involved in your plans and strategies?
Identify and educate your clients?
Do you try new ideas?
Do you ask peopel to help you implement, plans and programs that you are not familiar with?
As a final nail in the coffin of ensuring you are providing valuable service you may consider running down the following list to see if you have done all that you are capable of when trying to help another!
The following is a list of ways that can be used to measure potential actions when we begin to formulate ways that may be employed to successfully help another person. Use the following checklist to help you understand what other people need and to also see how may be of service to others.
Read the following list through each time before attempting to offer a detailed sollution to someone else's problem. You may find if you are standing in their direct presence, you will reserve judgement initially in order to further take the time necessary to develop an appropriate and usable suggestion, strategy or tactic.
How do they feel?
How can I guide, lead or show them how?
How can I be the authority for another personal's benefit?
How can I understand the way they feel according to their problem ?
How can I support a person through a situation of opportunity?
How can I help them understand and focus using definitive facts?
How can I further define the situation for others?
How can I help others to act with purpose in their mind?
How can I explain to others what to do with certain information and why?
How can I put what people want into words and build it for them?
How can I create greater benefits, protections, advantage, financial savings, safety, security and productivity?
How can I make people the center of attention when appropriate?
How can I recognize the hopes, fears, desires and emotions of others?
What problems can I help other people solve? What can I do for them?
How can I reassure and motivate people to take action with my advice?
Remember never assume anything, always ask!!!
How can I make people feel good and enhance and protect their lives also?
How do I appear credible when telling other people what I can do and why?
What do I have to give? What benefit do I have to offer?
People tend to feel out of control, confused and unstructured. How can I give them Control?
How can I Give people examples of how something will or has worked?
How can I get others to commit to action for their own benefit?
How can I show them, instead of just telling them how to do something?
How can I become more believable and understandable with my claims?
How can I help someone solve their problem today?
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