Shaping Your Product/Service

Customer feedback is probably one of the best ways to make your business successful. Think of it like this; through negative feedback, you can shape your product/service into something you know the market will love.

Most people think that bad feedback comes from people they have never even done business with, or with some of their ‘bad’ clients, so they decide to ignore it. This is, in fact, a complete myth; most of the negative feedback you will get will be from some of your most loyal customers. Not because they want to put you down; because they want to remain your best customers.

Think of it like this; ‘bad’ customers, if they encounter a problem of flaw with your product/service, they will simply move on to the next company who will solve this problem for them. Whereas for a loyal customer, they want to tell you about the problem, hoping that you will fix it and they can remain customers of yours.

Think of it like this; customer feedback is a free way to conduct market research. Your clients will tell you how they want their product/service. They will tell you about any problems they have; although you may have to prompt them to do so; perhaps through a quiz of survey.

Free Marketing

Well, who would say no to some free marketing? Quite a few businesses actually, so it seems! Customer feedback, when it is good, can be used in a multitude of ways, the obvious one being testimonials.

Every time you get some good feedback, you should ask the client if you can use it as a testimonial on your website, leaflets, sales letters; anything which you send to a prospective client. Likewise, when you get bad feedback, you should act upon it immediately, because it really will result in not only your product/service getting better, but perhaps some more business!

Think about it; if you had a problem with a company that you bought from, and you complained about the problem then it was solved, how much more likely would you be to talk about that than just receiving a product and there being absolutely no flaws to it?

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We have all heard the old adage that half of all advertising dollars are wasted; the problem lies in figuring out which half. The numbers become even more interesting (or alarming) when one examines the typical response rates for conventional (and unconventional) media.

Most direct marketers are happy to achieve a response rate of 1 percent to 2 percent — or 2 percent to 4 percent if they include a telemarketing component. That means the recipients discard 98 percent to 99 percent of their materials without a second thought. The results for brand marketing or advertising bring even more frustration to marketers and business owners alike, mainly because consumers’ perceptions about brands are so difficult to quantify. Yet, every business, especially a startup, needs marketing to survive and thrive. So what can an entrepreneur do?

- Focus on generating leads over building a brand. Leads bring customers to your door. Then their experience of your product or service, as well as the reputation you develop for customer service and delivery, will build your brand.

- Create materials that properly sell your product or service and allow you to track responses. The difference between response-driven marketing and branding-oriented marketing is that you can track, test and measure the first type and adjust it until it is right for your business.

Why is it so important to track, test, and measure? You need to establish baseline performance numbers for your business in your particular category of business and then to try to improve upon them. This is very difficult to do. Even professional marketers find it hard to “move the needle” when it comes to measuring customer response. If you focus, though, on two metrics that most others do not, you can work your marketing and advertising in new and more profitable ways.

- Figure out a lifetime value for every new customer. That is, how much the average customer will spend at your company over the course of the business relationship.

- Calculate the customer acquisition cost: the amount you spend to acquire a new client for your company. You never want to pay more for a new customer than you absolutely must; and you are striving for this person to eventually spend more than the initial acquisition cost so that your marketing is profitable.

For lifetime value, simply come up with a guesstimate for the value of a typical sale to a customer (say, $200). Multiply it by the number of times annually he or she will buy products (say, three times) and multiply that by the number of years the typical customer does business with you (say, three years).
The result (in the above example, $200 X 3 X 3 = $1,800) gives you an indication of the importance of setting up a repeat-business program that not only raises the amount that a person buys and the number of shopping occasions, but also extends the length of time he or she remains a customer.

For the acquisition cost, if you spend $1,000 on an ad and pull 100 people in the door, you are paying $10 for each lead. But if only 10 people make purchases, you are shelling out $100 for each sale (10 X $10=$100).

The above example demonstrates the value of boosting the rate of converting leads into actual sales, as well as targeting a level of return (at least $100) so that your campaign breaks even — or brings in more so that your efforts truly profit.

What’s key is to use actual numbers from your own company’s experience and business category to help you make better decisions about spending your precious marketing resources.
Here are five additional tips to help you focus your thinking to generate a better response from your marketing and more return on your investment:

1. Define marketing differently. One of the simplest interpretations is to consider it communication and education. You are communicating to customers or prospects on a regular basis with actionable, sales-oriented information about your business, product, or service.

2. Adopt the mindset that you’re not advertising; you’re buying customers. Consider your efforts a way to purchase for your business the best customers possible – just like Billy Beane did in Moneyball. That means you always market and advertise with the expectation of realizing a return in the form of new leads. If this is not your result, end your campaign and move on. But if the new leads materialize and customers purchase your products, then you have the basis for a winning campaign.

3. Realize nothing has really happened until a sale occurs. You might have a great logo, a slick business card, exceptional letterhead, a killer website, and all the other props of a company, but you don’t have a real business until you net customers and sales. So orient everything you do to realizing leads, sales, and repeat business — especially the latter, which is where your profits and growth will lie over time.

4. Rely on the formula: “Target, Offer, and Copy.” Define your ideal, perfect customer. Then target that customer again and again with benefits-oriented offers (“what’s in it for them”) and marketing work that supports your sales message. Then measure the results. Profiling your ideal customer (through demographics and psychographics) and discovering the media to best target that client will keep your focus laser-like. This process alone will help you eliminate most media or at least limit your choices. Or if you plan to purchase radio or TV ads, you will be able to weed out the stations or programs inappropriate for your target.

5. Test any new marketing medium first. I have seen some startups set aside $50,000 or $100,000 for an ad budget and then fork it all out for a single media campaign. It’s better to take $5,000 or $10,000 and experiment first. That way, you will have enough resources left in a contingency fund to try something else if the first effort does not work. Plus, your company will be able to survive an ineffective campaign.

Tip #8 focuses on getting social.

More than 9 million small businesses have Facebook accounts. Are you one of them?

Most small businesses often rely on word-of-mouth marketing to grow their businesses. The explosion of social media has made word of mouth available at an unprecedented scale. If you haven’t set up your Facebook account, now is a great time to do so. Don’t forget about other popular social sites like Twitter and LinkedIn. These tools can help you build a relationship with your customers.

Of course, it’s not enough just to create your sites; you have to make them work for your business. Include your social media links or addresses throughout your store, on any correspondence with customers, in all marketing materials, even on invoices and account statements.

Optimize your site for “likes,” too. Facebook has boosted the visibility of users’ “likes” by adding thumbnails and meta data from its Open Graph Protocol, meaning that getting a page “liked” on your Website will improve your visibility in newsfeeds. Make sure you have a like button incorporated throughout your Website — Facebook has a button tool that will let you create and customize the button for your site.

If you have never tweeted before, now is a great time to start. Tweeting can be easy and fun when you talk about what you know best: your business, your industry and your expertise. As you build a list of followers, use hashtags (#) with industry terms so that you extend your reach to terms people are following on Twitter. You also can extend your reach by having your tweets posted to your LinkedIn account, thereby adding visibility to your LinkedIn network and offering multiple ways for your customers to engage with you.

Customers really do want to hear from you. The most important thing to consider when using social media is to be authentic. Engage with your customers and followers in a way that feels genuine. You’ll build profitable relationships that will last.

Be sure to download our e-booklet, How To Maximize Small Business Saturday.  Don’t miss out on preparing your business for this lucrative time of year.

In today’s digital universe, finding customers sometimes can feel like a game of “Where’s Waldo?” While there might be people everywhere, you don’t need to be a marketing guru to figure out that not all of them are going to buy from you. So what’s an entrepreneur to do in order to find the right customers?

One place to start is with good information. That’s why I wanted to tell you about our new Market Profiler and Customer Profiler reports — two valuable resources that can help you find out exactly who your customers are and learn more about the markets where you do business.

We have three different reports, and two of them are free, so this is a perfect opportunity to find out some information on your customers such as age, household income and length of residence. The upshot is that you can use this information to find more customers, and voila! Your marketing returns improve significantly.

Don’t take my word for it, though. See for yourself and download your own sample reports here.

The holidays are an important time of year for marketers, who are looking to boost profits and find more customers. In this crucial season, you need to be attentive to insights from previous holidays and apply that information to your marketing strategy. Here we offer some industry wide statistics and facts to help prepare you for the winter months ahead, along with some tips on how to create lasting holiday marketing success.

The Facts

Seventy-Nine percent of consumers say they looked at or read the direct-marketing pieces that arrived in their mailbox.

Nearly half of all purchases from catalogs take place in November and December.

A typical consumer receives 25 pieces of mail per week and is likely to take action on 9.5 percent of it.

People continue to rely on traditional sources such as print pieces for Thanksgiving Day and Black Friday sales. In addition, they peruse printed catalogs for common products and check the mailbox for coupons.

Direct mail is alive and well. In fact, according to published results from the United States Postal Service (USPS®) and the DMA, direct mail is not dead. In fact, it’s still effective, with an ROI of $12.53 for every dollar invested.27 Furthermore; direct-mail spending is projected to grow 105.8 percent to $47.8 billion this year, driven by acquisition mail increases.

The Tips

To drive early sales, prominently highlight crucial dates — such as sale cutoffs and the final day for free shipping — with images and bold fonts.

Don’t lose out on the customer engagement activities and revenue gains that direct mail offers. Most companies are getting lifts in response rates from the combined powers of online and traditional channels such as direct mail.

Get to your potential customers ahead of schedule — and before your competitors do.