Feb/100
Worried about using your customer data for direct marketing?
Several local business owners have recently expressed to me their concerns over collecting and handling their customers’ data. They don’t want to annoy their customers and they want to make sure they don’t break any laws or regulations.
As more local businesses take advantage of mobile and internet technology to grow their own audiences, these concerns will become increasingly common. If you are a concerned business owner, here are the key points to keep in mind.
Firstly, you are right to be collecting your customers’ contact details and preferences. It is no longer viable to rent an audience from your local newspaper or radio station. Your competitors may be saving money and winning their customers’ loyalty by building their own audience. So should you. Don’t let your concerns put you off.
To succeed in building your local audience and converting them into true fans of your business, here is the most important thing to do. Get their explicit permission. Without that, their interest in your marketing messages will be minimal. Your response rates will be low and you may even upset some people. How often do you welcome a mailshot or email that you did not ask to receive? Invest time in finding good reasons for people to ‘opt-in’ to receiving your marketing. This is the best way to get high response rates. And responses lead to sales.
If customers give you their details as part of buying from you (for example, a salon takes your name and number when you make a booking), don’t assume that they want to receive your marketing. When you take their details, ask them if you can get in touch now and then when you have something special to tell them about. This is not only good practice, it is also an EU requirement for anyone that conducts marketing by electronic means. Oh, and don’t give their details to other businesses. At least not if you want to keep your customers.
Your next aim should be for customers to look forward to receiving your messages because this will generate the best response rates. To achieve this, you’ll either need to send very tempting marketing offers (very expensive for you) or send offers that are very relevant to people’s interests. If you are an off-license, is your customer interested in white wine, red wine, beer or champagne? This is where you’ll need to get creative about giving people reasons to tell you their interests and also making it easy for them to tell you.
It’s natural to be concerned about conducting business in a new way. The best way forward is to think it through, make a plan, then get stuck in. Treat it as a trial. Expect some error. When you get it right, you will enjoy a well deserved advantage over your competitors.
Jan/100
Email v Text
Which should you use for marketing your local business, email or SMS? Let’s take a look at the differences.
- Email is free to send, SMS isn’t.
- An email can be as long as you like, whereas an SMS is limited.
- An email can include pictures and images. Not an SMS.
- An SMS can be written and sent in minutes, whereas email requires time and money to be composed and sent properly.
- Most people read emails at home or in their office, whereas with SMS it’s wherever they happen to be when they get a text.
- Text messages get noticed instantly. Emails often don’t. Some people take days to notice a new email. Some emails are filtered into spam or junk folders, so never get read.
- Over 95% of texts are opened immediately versus around a quarter of emails.
Which is best depends on what you want to achieve.
If you want to say something to your customers that isn’t urgent and you want them to engage deeply with your message, then email is best for both you and your customers.
On the other hand, if you want to say something right away or you want certain people to be the first to know about something, there’s no doubt that SMS is best for you and those customers that want to be the first to know.
Is your salon looking very quiet next Monday through Wednesday? Why not send an SMS to the stay-at-home Mums in your address book and make them an offer they can’t refuse? Perhaps promote a luxury service rather than a standard cut, so that you don’t prevent them booking their usual monthly trim. What’s better, an empty salon or a busy one with customers paying half price for things they wouldn’t usually buy?
Jan/100
A resolution for 2010 – get permission!
This seems like an obvious point, but make sure that customers know what to expect when they agree to receive direct marketing from you. Are they consenting to email only, or also SMS? Are they opting in for special offers only or will they receive general news and updates about your business? The clearer this is, the more welcome your message will be, the greater chance of receiving a good response from customers. In this respect, people rarely welcome surprises.
Your aim should be for your customers to welcome and look forward to your marketing rather than to put up with it. If it is expected and welcomed by your customers, there is far more chance that it will influence them.
A list of your customers’ contact details is almost worthless unless you have captured their interest and gained their permission. If you have their interest and permission, you have a good chance of generating revenue with each piece of marketing you send.
Dec/090
The problem with doing nothing
There are many reasons why you should do nothing.
- I can’t use a discount to attract new customers because my existing customers will be upset.
- I can’t change my supplier because it will mean rewriting our menu.
- I can’t send marketing emails or SMSs to my customers because they might find it irritating.
Your job, if you wish to make a difference and grow, is this. Put to one side your comfort with the way thing are today. Then, find reasons why these activities do make sense. Not only why they make sense to you, but also to your staff and customers.
- Create a separate promotion exclusively for your existing customers. Perhaps an incentive to try a new or premium service.
- If you can’t easily change your menu, you are wide open to local competitors who might change their menus daily. Do yourself, your staff and your customers a favour by redesigning your menus to be more flexible.
- Get your customers’ permission to send them messages and make sure you send messages that are relevant and compelling.
The problem with doing nothing is that you are learning nothing. You’re not finding out what works and what doesn’t. The problem with learning nothing is that you are not moving towards the situation where your hard work generates more money.
Dec/090
Snail mail, email or SMS?
So you’ve decided that you want to communicate with your customers or try to reach some new ones. You’ve got something to say and you think that people will want to hear it.
What next? Do you put it in an envelope, write it in an email or text it? Once you have answered the following questions, you’ll have a good idea of which route to take.
- Who is your target audience and what form of communication are they likely to most appreciate and find convenient?
- Is your message an urgent one? Is it a last-minute offer or an exclusive deal, where your customers could miss out if they don’t get the message instantly?
- Does your message require a response and how would your audience most like to respond?
- Is your message simple or complex? Can it be said in 160 characters or does it require prose and pictures?
- Do you have an exclusive brand that requires your message to be delivered in a premium way?
- Is it essential for your customers to be moved by your communication? Email provides the ability to move people using the written word and images. Physical mail adds touch and smell to the experience.
- Do you have the time and resource to design a suitable email or hardcopy mail?
- Is cost a big factor?
As a general rule, your message shouldn’t inconvenience your customers. Whichever route you take, you will be interrupting their daily routine, so make sure the message is worthwhile.
If your message is more complex and requires you to tell a story, then email or snail mail is your best bet.
When the message has a clear and immediate selling point, such as an exclusive, last-minute offer, a text is impossible to beat for both you and your customers.
Nov/090
Go get em Tiger
Are you a passive marketer or an active marketer? Do you go out and get customers or do you let them find you?
Being passive means waiting for people to walk past your shop, find you in an online directory or search engine, be told about you by friends, come across your advert in the local paper. This is less effort than being an active marketer because you simply pay some money and then hope customers find you.
Once you have some customers, you automatically have the opportunity to become an active marketer. Being active means reaching out to your customers and bringing them back to you again and again using methods such as direct mail, email or SMS. This requires some effort.
Firstly, you’ll need to collect the details of every customer you meet. But shouldn’t you be doing that anyway? You have invested money in premises, equipment, advertising or other things to get those customers in the first place, so surely you must keep in touch to make the most of your investment? Otherwise, wouldn’t it be like buying a box of matches and throwing the whole box away after using just one match? Just as a box will provide you with many matches after the first one, many customers will potentially buy from you several times. That is, unless you let them forget about you.
Secondly, you’ll need to keep customers interested by sending offers that they find compelling. There must always be something in it for them. Yes, it may cost you something to make offers compelling but you are building long-term sales potential, which is no less important than any of your other expenses. If you do this, you will be rewarded with a good response rate each time you actively reach out to your customers.
This is when active marketing really starts to pay. If customers have given you permission to contact them and you have learnt enough about them to send compelling offers, such that you always get a significant response to a campaign, you have effectively built a money-making machine. You have the power to generate sales whenever business is slow, when you have a special event or when you launch a new product. In fact, any time you like.
Nov/090
Should you reduce prices to sell more?
That’s such a huge question that I’m already regretting trying to answer it. As always on Local Marketer, I’ll focus on how this question relates to local businesses.
First of all, raise your hands if your local business is so busy that you don’t have the time or capacity to serve more customers than you already have. Ok, the lucky few with their hands raised can stop reading now – this question doesn’t apply to you guys. Your homework is to find a nice way to raise your prices.
For those still reading, how did you set your current prices? Probably by looking at your competitors, right? If your product or service is a commodity, such that your product is very similar to your competitors’, then there’s not much room to play with pricing as customers can easily get the same thing elsewhere.
However, if there is room for you to add value, perhaps in a way that your competitors don’t, then customers might be willing to pay you more than they do your competitors. Don’t assume that lowering your prices will bring you more business over the long term. Your customers may not be sensitive to your prices.
Alas, for the vast majority of products and services, consumers are sensitive to prices, particularly with the economy as it is today. If you are thinking of lowering price for the long term, you need to consider whether your new prices allow room for profit. Assuming that your number of sales does not increase immediately when you lower prices, how much less money would you make per month and how long can you afford to wait for the increase in sales? If you work that out beforehand, you’ll know how long you can afford to run the experiment for. If your sales volume eventually increases enough to grow your profit, you’ve succeeded. If not, you’ll need to go back to the drawing board.
Of course, the most common type of price reductions are the temporary ones – sales, promotions, last-minute deals and special offers. If you execute them cleverly and selectively, then they can be a great way to generate business in the short term. Although, if you have regular customers, don’t offer them a discount on a service or product that they have bought from you every month for years, such as a standard haircut – you’ll make less money and those customers won’t become more loyal. Perhaps offer those people a discount on a head massage or colour treatment, so that the offer leads to an up-sell.
The truth is that for many local companies, the ability to generate extra business at short notice is essential to survival. To fill un-booked restaurant tables, empty seats, vacant appointments, available time and unused seasonal or perishable stock amongst other things. If this applies to your business, make sure you know how to run temporary offers with style and acquire the tools to execute them quickly at the last minute. Nowadays, mobile marketing and SMS in particular is the best way for local businesses to execute time-sensitive promotions cost effectively.
And don’t kid yourself that your business is too posh or your customers are too wealthy for promotions and special offers. Most people love to save money, particularly those who have been successful in acquiring it.
Oct/090
Why you must build your own audience
Something big is happening in media and advertising circles and it is going to directly affect you, the owner of a local business.
In fact, it has been happening for some time. And it doesn’t only affect you. It also affects big businesses, online businesses and any business that sells something to people. The bad news is that you’ll need to change your ways to stay ahead of your competitors. If you don’t, you’ll be at a distinct disadvantage. The good news is that, if you start now, you can be one of the winners.
Have you noticed that local newspapers have been struggling recently? It’s not only the locals. A few weeks ago the London Paper was shut down for good and now The Evening Standard has announced that their newspapers will be given away for free. It’s not only due to the economic downturn, it’s also because people have so many ways to get news, gossip and information nowadays: Yahoo, Facebook, Twitter, Linked-in and a huge number of online magazines to mention a few. With audiences for traditional media declining, it’s harder for you to attract people to your business by paying for advertising.
A huge industry has emerged in recent years to provide advertising space online, particularly around Google’s search engine. Every business wants to be at the top of the first page on Google searches and many happily pay to appear there via sponsored links. There are thousands of companies that you can pay to improve your Google ranking. For example, directories such as Yell spend huge sums of money making sure that their paying customers rank highly on Google. There are two things to remember here. First, spending money with those companies won’t guarantee you a high ranking. Second, a high ranking on Google won’t help you unless people are searching for your type of business on Google.
Social media is another area that is receiving increasing interest from businesses that want to reach consumers. Businesses want to understand how they can grow using Facebook, Twitter, Myspace, Digg and others like them.
The most important thing to note is that there are now a huge number of channels into which consumers can direct their attention. In years gone by, a business could reach the entire population using print, TV and radio. The internet radically changed that and now, mobile phones are shaking things up again. To some extent, the population is divided into small pockets who spend their time in different channels, many of which are currently online. Your ad in the local paper or glossy magazine is still expensive (after all, they have the same overheads as before), yet their audience is increasingly smaller and less attentive.
Your business may only be a small, local one but the answer to the problem of how to reach people is the same as it is for big businesses: You need to start building relationships directly with consumers. With traditional media, you buy space, which is like buying a chance to attract the attention of their audience.
Now, however, you can afford to build your own audience. By audience, I mean a group of people that have given you permission to talk to them; people that are interested in hearing from you. Building your own audience costs money and is harder to do than advertising, but in the long run it’s worth it. When you buy ad space, the money you spend has no return beyond the short term interest it attracts. When you build your own audience, you are investing in the future. Over time, you’ll teach your audience about your products and you’ll gain their trust. They’ll buy more from you and spread the word. Your business will become focussed on what customers want. You’ll spend less on advertising and more on finding ways to grow your audience. Your audience will become a valuable asset, perhaps the most valuable thing you have.
So how does a local company afford the time and technology to build their own audience? You can do that by taking advantage of the 7th and latest mass media – the mobile phone. Sendster, my mobile marketing service, has been designed to enable small, local businesses to build their own audience and then convert that audience into loyal fans. Some details:
Firstly, you can let people join your audience or fan club directly from their mobile, simply by sending a text. You’ll need to offer them an incentive to do this, perhaps something for free or maybe just the promise of future special offers. Once they join, they automatically appear in your secure, online database. This sounds like it could be expensive, right? The cost of building an audience of 1,000 people using Sendster is £240. Last time I checked, this might have just about bought you a half-page advert in a regional magazine. Once you have an audience, you can start sending them occasional offers by text to generate business.
Secondly, when you are ready to send offers, there is no design work to be done, no print deadline to be met, no notice required, no hours of trying to figure out why you’re not appearing at the top of Google or why nobody is clicking on your sponsored links. There is just a text message to write. So, simply think of a great offer to get your audience spending money with you and send it to their mobiles – for 8p per message. You can send an offer to 1,000 audience members for £80. How many will need to respond to your offer to make a profit on your £80 investment? Two people? Ten? That’s a response rate of 0.2 % or 1% respectively.
A big change is coming. It’s been coming for some time now. The future belongs to businesses that have their own audience. If you are a small, local business, with little marketing budget and even less spare time, there is only one service that has been built specifically so you can do this. Visit www.sendster.co.uk for more details.
Sep/090
Using special offers to increase sales without upsetting regulars
Customers love a bargain, yet few people like to buy from a business that constantly has a ‘SALE’ sign in the window. Getting this right can make the difference between increasing sales and acquiring a costly ‘bargain-basement’ image.
All businesses have their ups and downs. During periods of low demand, a business owner needs to find ways to bring customers in or generate sales. Often, this needs to be done at short notice. When it comes to motivating people to buy, a special offer or incentive is a powerful tool. If done properly and regularly, the additional sales that can be generated over a year using offers and promotions can make the difference between scraping a living and making a handsome profit.
The most common concern I hear from local businesses with regard to special offers is ‘I don’t want my regular customers to find out’. This is a genuine concern. If you have a base of customers that use your service every week or month at the current price, won’t you lose money by offering them a special? However, this is not a reason to deny yourself the extra money you could make. Let me explain:
Can you think of even one customer that could not spend a little more money with you than they do now? My point is that, no matter how good a customer, there is always an opportunity to sell a premium service or to add another product to their shopping basket. A salon can offer their regular ‘cut and blow-dry’ customers an incentive to try a colour ‘25% off all colour treatments next Tuesday’. The salon should send this only to customers that don’t usually have colour treatments.
Is that unfair to those good customers that regularly pay for both cuts and colour treatments? Of course not, because the salon can offer those customers a different incentive, such as ‘Book your next colour treatment this week and get 30% off our new advanced conditioner for coloured hair’.
To make special offers work without appearing cheap, a business needs to separate customers into different groups according to what they buy and prefer, then send special offers that appeal to those groups. This does not take a great deal of effort and the benefit is that those customers will spend more. Plus, your quieter periods will get a little busier. Quiet periods not only hurt your pocket, they are also bad for staff morale.
In addition, running offers and promotions in a targeted way is appreciated by customers. Your customers receive offers that interest them rather than blanket discounts that make you seem like a bargain-basement operator.
So don’t shy away from using special offers and promotions. They are an essential money-making tool for all local businesses.
I’ll end this post with a shameless plug for my own business. Many local business need to bring customers in at short notice. For example, to fill empty tables in a restaurant this weekend or to sell produce that has a limited shelf-life. To generate sales at short notice, there is no better way to deliver special offers than to the mobile phones of your customers. And there is only one service that is 100% dedicated to helping local businesses do that: Visit Sendster.co.uk to find out more.
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