| Why does marketing seem so difficult to most small | | | | To figure what your real cost to acquire a customer is, |
| business owners? | | | | let's look at the conversion rate of our marketing |
| Why is it so hard to get in front of people for the first | | | | material. Above we assumed 10%. That would mean |
| time? | | | | that we'd have to have 10 people looking at our |
| Most small business owners miss the point of what | | | | marketing material before one would buy. At $1 per |
| marketing is about. | | | | click thru (or it could be a direct mail piece that cost us |
| As a small business owner: | | | | $1 each), that would be $10 (cost per marketing item |
| | | | conversion rate =$1/10%=$10). |
| 1. Does your marketing talk about you, your products | | | | This customer would spend $1,000 but would cost us |
| and services... Successful marketing is about what | | | | ony $10 to acquire, a 100:1 return on investment. Think |
| yourcustomer wants and needs... his problems, a | | | | about that. If you thought you could get that kind of |
| solution to that problem, and the VALUE he gets from | | | | return from the stock market most people would go |
| you. | | | | totaly bonkers... 'BUY BUY BUY" would be heard from |
| 2. Do you avoid marketing because it costs too much? | | | | the rafters. But, in this case, Jim was plain afraid that |
| -- The most important cost in marketing is not the | | | | he might get a lot of these. Hmmmm! |
| upfront cost of marketing, but what does it cost to | | | | But let's look at what would happen if our marketing |
| ACQUIRE a customer. There is a BIG difference | | | | isn't working well. Lets say that we only get 1% of |
| between those two concepts. | | | | those looking at our website to buy. Now it would take |
| 3. And last, but not least -- marketing has changed | | | | 100 people at $1, or $100 to acquire a customer, but |
| drastically just in the last couple of years -- what used | | | | we are still making $1,000. That stillw works. However, |
| to work no longers works. The internet has changed | | | | if we were selling a $10 item we'd be in trouble. In that |
| EVERYTHING. | | | | case we HAVE to get our marketing working better. |
| I could write a book on each of those things, but let's | | | | AND then it would still work. Most people would throw |
| get straight to the point. | | | | their marketing out with the bathrwater and walk |
| Marketing Is Not About You, Your Products or | | | | away. However, we HAVE to work this formula to |
| Services | | | | make it work.And if we aren't looking at the COST |
| The only thing your customer is looking for when he | | | | TO ACQUIRE a client and how we fix it then we'll |
| starts looking for answers to a problem is | | | | miss the whole point. |
| - Do you understand his problem? | | | | Now, staying with the $1,000 purchase, if our website |
| - Do you have a soluton to that problem? | | | | conversion falls to 0.1% (which many website do), then |
| - What is the value of that solution? | | | | it would take 1,000 people looking at the website to get |
| But take a look at ANY marketing almost anywhere, | | | | one $1,000 purchase and we are at breakeven. But if |
| brochures, websites, newspaper ads, business cards. | | | | we were selling something of lower cost we'd just |
| What do you see RIGHT AT THE TOP -- company | | | | plain have to work on that marketing message to get |
| names, people's names, company logos, and what do | | | | higher conversion rates, or start marketing one to |
| any of those say to the customer about what he's | | | | many instead of one to one, that would lower our |
| struggling with at the time? | | | | costs as well. |
| I know you, a business owner, are proud of your logo | | | | Get the idea? It isn't JUSt the up front costs, but the |
| and company name, but that's not the point, at least it | | | | ultimate "cost to acquire a customer." that we have to |
| isn't to your customer. | | | | manage. Making a decision about not spending on |
| It's simple, your customer is looking for those three | | | | marketing based on only the upfront costs can be a |
| things bold-dotted above, and the easier you make it | | | | very poor decision. |
| for him to find those things the better your marketing | | | | Even so-called FREE marketing can be a mistake, |
| will work. So the first thing that has to happen is you | | | | especially when a dollar spent on marketing that would |
| have to GET THE ATTENTION of someone who's | | | | bring you 50 cleints tomorrow that would spend $1,000 |
| looking for help with a problem he has. Your name, or | | | | would bring you $50,000 overnight, but FREE |
| company name, or logo won't get his attention... | | | | markeitng may take months to get one $1,000 |
| because most names don't mention what your | | | | customer. |
| customer is looking for, an answer to his problem. | | | | Marketing Is Not What It Used to Be |
| The headline at the top of your marketing material | | | | And finally marketing has changed rapidly over the last |
| either gets attention and gets read, or it gets scanned | | | | 10 years, and even fater over the last year. Why? |
| past, at which time NOTHING else you say in your | | | | The internet has changed how people look at the daily |
| marketing gets read. It doesn't matter how good the | | | | impact of interruption type of marketing. The culture |
| rest of the material is if the top of your marketing | | | | has changed. We avoid anything that looks like, smells |
| doesn't get attention. | | | | like, or quacks like marketing. Therefore, when we |
| Simple. | | | | receive anything that looks like plain old, traditional |
| I'll guarantee that if you develop a marketing message | | | | marketing, it gets thrown before it gets read. |
| that you can deliver at the top of all of your marketing, | | | | - Cold calling -- Most people don't even answer their |
| that the number of people reading the REST OF THE | | | | phones at all. Calls are screened with caller IDs and |
| STORY will go up by at least 10 times. | | | | even our friends frequently don't pick up the phone. |
| Avoiding the Cost of Marketing | | | | They will let it ring and call back only those that they |
| When I do marketing workshops, I'd guess that 90+% | | | | want to call. A sales call will be totally ignored. And, |
| of the people in the room tell me they either avoid | | | | then there is the "no call list". Cold calling just plain |
| marketing... "because it costs too much" or they use | | | | doesn't work any more. At lesat when done the old |
| what they perceive as low cost marketing. | | | | way. I'll show you better ways later. |
| But both of these approaches usually lead to... | | | | - Direct mail --Again, if it looks like "marketing" it gets |
| marketing that costs an arm and a leg, and probably | | | | thrown without opening. Although I can show you |
| their business and their life savings. | | | | ways to improve this,there are just plain better ways |
| The REAL cost of marketing isn't the upfront obvious | | | | to market today. |
| cost. The REAL cost that you should look at is "what | | | | - The OLD Printed Yellow Pages -- most people go to |
| does it cost to acquire a customer." That may sound | | | | the internet now, not to the yellow pages. There are |
| the same but it isn't. | | | | some industries that people still use the printed yellow |
| Let's take a look at some numbers I've heard in some | | | | pages to find so this isn't totally dead, but it is dying and |
| of my workshops. | | | | will go away soon. |
| Jim, a small business owner, said that he hadn't tried | | | | Get the idea? |
| pay per click campaigns because he was afraid that | | | | The old style of marketing was "interrupttion" based. It |
| the $1 per click was too much, and, as he said, "What | | | | interrupted our day with a cold call, or breaking into our |
| would happen if I got a couple of thousand clicks by | | | | stream of daily work in some way. It was intended to |
| tomorrow morning?" | | | | get in front of the eyeballs or ears as they were doing |
| I asked him, "Wasn't that what you wanted, a LOT of | | | | their daily thing. |
| traffic?" He seemed to actualy fear that he'd succeed | | | | Today, what works is to be where your customer is |
| at getting way too many customers and it might cost | | | | already looking for his answers, to provide information, |
| him a bundle. he sees marketing and acquiring | | | | education. To help your customer on his way ot |
| customers as an unneeded expense rather than what | | | | making decisions, "How to solve this problem," "What's |
| that customer would bring to him. | | | | the most valuable solution" what works, what doesn't. |
| If he had 2,000 people visit his website, and 10% of | | | | The internet has become a place to "get informtaion" |
| them bought his $1,000 service... let's see, that would be | | | | to "get answers" and not necessarily to out and out |
| 200 new customers spending $1,000 each = $200,000 | | | | buy. So we have to be found on the internet for whatt |
| overnight, of course, assuming he can deliver. | | | | he customer is looking for "help," "information" and |
| But he fears that upfront cost of marketing so he | | | | "education." Today that's called "information marketing." |
| hasn't even looked at what the potential is. Right now | | | | Later he will buy from us because we've provided him |
| he doesn't have $2,000 a day to spend on marketing. | | | | with the most valuable information, helping him resolve |
| But he could spend $50, get 5 new clients, which | | | | his problem. We have become THE EXPERT in his |
| would bring him 5x$1,000=$5,000. Gee, wouldn't you like | | | | eyes. |
| ot have $5,000 a day? Then he'd be able to crank up | | | | Marketing has changed. Are you still doing it the old |
| his investment in marketing even further. Get the idea? | | | | way? How do you move toward the new way of |
| Our thinking frequently is more self limiting than allowing | | | | marketing? |
| us to find the opportunities like this. | | | | |