Monthly Commentary
STAY IN THE LOOP
Or Move to the Back of the Line and Please Pass Forward Your Wallet
Closing the Loop
As the owner and, therefore, chief marketing officer of your small business, you must be intimately involved in the lives of your customers. Certainly, keeping track of birthdays and children’s graduations is important, but accurately understanding how your customer uses your product or service is even more critical. Saying, “Hello” in passing is one thing, but asking your customer –point blank –“How am I doing and how can I do better?” is another. Whether you are offering a product or service, it should be customer-oriented, not company-oriented (as in your company). Instead, focus on giving your customers what they want and need, not on what you have and want to give them.
To ensure that your product or service satisfies a real need or provides a solution, ask thoughtful questions; listen to your customer’s feedback; and respond with disciplined, prompt and appropriate action and innovation. No, we do not always like what our customers have to say, but we should forever value the chance to close the loop –or bridge the gap between anticipating customers’ needs and acting on them. In the process, we continually educate our customers and ourselves. And if we subsequently make a promise to do better, then we ought to do better –or die trying.
For a small business owner (SBO) or entrepreneur, the rewards of being in the loop are numerous:
§ New business development
§ Organic growth
§ Insider partnering opportunities
§ Improved forecasting ability
§ Greater return on marketing investments
Ensuring Big Growth for Your Small Business
Regular one-on-one conversations with customers make them feel valued and appreciated. Consequently, they are more open to surveys and discussions concerning new products and services that could extend beyond your existing customer base to new customers or new markets. Can your product or service be used in another manner or by a new segment of the market, thereby creating a new target market? Again, understanding how existing customers use your products and services, and recognizing unfulfilled needs will help you deliver on the value proposition to your customer.
Sometimes, new business can be yours simply for the asking. The most rudimentary rule of sales and marketing is to always solicit a referral: “If you don’t ask for it, you definitely won’t get it. If you do ask, there are three possibilities –you will get it, you won’t get it, or you might get it. If you deliberately shift your approach from selling to focusing on solving your customer’s problem, a ‘maybe’ could become ‘yes’.” –Glenda Chapman, Legion of Excellence Pharmaceutical Sales Representative, Bristol-Myers Squibb Company.
Always ask for referrals or leads. As a director of career services at a private computer training center several years ago, I sought job leads on behalf of graduate students. If I had not asked about openings at some of the leading firms in the area, because I was afraid they would say no, I would not have placed more than 80% of my students in top positions at preferred companies. Of course, it will not be fruitful every time, but just one sizeable referral can really boost your bottom line.
On the other hand, organic growth is internal. The question becomes: How can you sell existing customers more of what they are already buying, or get them to try something new in addition? Memberships and loyalty programs are great for building consistent business volume, and they can also help protect your small business against the proverbial customer “leaky bucket” in which existing customers gradually leak out of the bottom of the sales bucket as new customers are added. The more existing customers you are able to retain, the greater your market share and less costly to your business in the long run. Also, use rebates or trials in order to get existing customers to try something new –they provide a less painful entry.
Getting to know your customers intimately will eventually lead to partnering opportunities that only an insider is aware of. So, show emotion for your customers’ circumstances; let them know you care and you are listening. In my 11 years of corporate marketing experience, indifference or an “uncaring attitude” is one of the primary reasons that customers go elsewhere. And there is nothing that upsets me more than when a customer says, “You just don’t care about my business.” Gain their trust by exhibiting integrity and character in every business decision and interaction –whether it involves a customer, supplier, employee or peer. And to further establish credibility with your customers, be well informed, so when questions arise or evidence must be presented, you will become their resident expert. Once you have taken on this influential role, you have become a veritable collaborative partner and the opportunities will soon flow your way.
No-Bake Recipe for Success
Forecasting ability can be a competitive advantage for one company and a disastrous weakness for another. If you are not close to your customer, you have no hope of producing a meaningful forecast. Frequent dialog and interaction with your customers will not guarantee an unshakable forecast, but it will facilitate spotting trends early, and drawing subtle insights from changes in your customers’ behavior. Forecasting is a peculiar blend of artistry, analytics and customer involvement. Finding the right combination for your business is vital to future success, so start out with just a pinch of artistry; add a rounded tablespoon of analytics; and gradually mix in a heaping cup of customer involvement. Along the way, you may modify this recipe as needed, but do not leave out any of these essential ingredients. I discovered this no-bake recipe years ago and have employed it in my forecasting practices ever since; I continue to enjoy higher accuracy and greater satisfaction with the process.
Return on Marketing
Do you sometimes feel like you are throwing hard-earned profits into a marketing black hole? If you do not have sound metrics in place to measure the success of your marketing programs, you could be. Every marketing investment should result in more sales or a shorter sales cycle, which leads to more sales. How much revenue will your marketing program generate? What is the total cost of the program? Is it a high-risk program or a low-risk program? These are basic questions that you must ask yourself –and be comfortable with the calculation –each time you add a new marketing program to your business plan.
Be certain to consult with your customers on new ideas and market test various campaigns before executing on a full-scale promotion. No matter how tempted you are to skip testing –do not. Sending something out with an incorrect phone number or spelling error can be avoided easily. And what if the customer simply is not interested in receiving a free pair of safety goggles for responding to your offer, or they want the golf shirt, but prefer to have it without your logo on it? It is better to find that out before spending $4,000 on an incentive inventory you cannot get rid of –even when you are giving it away for free. (Did I do that?) Testing provides an opportunity for you to mitigate the number of non-responses and TBNT (Thanks But No Thanks) replies, by allowing you to tweak a specific element of the promotion. Take care to adjust only one aspect at a time, because doing so will allow you to clearly see the impact of each small modification. If a particular marketing program simply is not working, do not be afraid to try something different.
A True Story
Shawn Lesser is a professional comedian that I first met in Atlanta a couple of years ago, when we both belonged to the Wildwood Toastmasters Club. He started his small business, Showcase Comedy, in the early 1990’s, and since then he has grown his company exponentially. He has added new services for existing customers, such as reality and game show simulations; crossed over from mainstream comedy into corporate events and comedy for charity; and closely works with clients and local talent to personalize show content, which may involve pre-show interviews with participants, on-site visits and industry research.
Often, Shawn seeks out my opinion on new ideas –whether they are proposed for my own project or another client’s act. He makes me feel like my point of view counts, and in return I am completely honest with him –about the probability of future engagements with my company, my overall satisfaction with his products and services, and my first impression of marketing promotions that I receive from him. The end effect is a mutually satisfying professional partnership that is predicated on open, honest communication in which we both reap “looping” rewards. In this case, truly, what goes around comes around.
As a fellow marketer, I urge you to stay in the communications loop with your customers, or move to the back of the line, and please pass forward your wallet. Failing to get intimately involved in the lives of your customers will bring about substantial lost profits and missed opportunities for your small business or start up, sooner or later. And, in the meantime, every penny that you spend on direct mail, advertising, relationship selling, key account management, tradeshow exhibition, web site development, networking and group events will go toward priming the market for your competition –unless you monitor and measure the results, and then take appropriate swift action.
Do all you can now to stay in the communications loop with your customers. If you do, you will be able to hang on to your wallet a little while longer, and move to the front of the line where the rewards of being “in the loop” are abundant –knowing that your “uneducated” competitors will be at the back of the line asking why things are moving so slowly. If it’s your lucky day, a few might decide to get out of line altogether!
Ms. Aundrea Wilcox, KOSBE Executive Director
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