A significant chunk of the British economy is driven by consumer confidence.  When people feel happy, settled and confident, they spend money.  And that helps British (and other) businesses.  I’ve written plenty about the ‘science’ of understanding consumer confidence.  It can hinge on very simple, yet uncontrollable things, such as whether the sun in shining.

Business confidence is a slightly different animal.  And we sometimes forget that businesses are large spenders in our economy.  They create jobs, they buy products and services from other businesses and they have a large part to play in generating money.

Whether businessses spend money depends on things such as:

• Whether their customers are spending more or less
• Whether they think their customers will spend more or less in the future
• Whether they can borrow any money
• Whether they’re confident of the future
• Whether they can spot opportunities

I don’t need to tell you that funding is hard to come by for most businesses.  Which means they have to spend from their cashflow.  This is like you spending from your wages and not using your overdraft or credit card.  It limits how much you can do and how much you can grow or invest in the future.

And the perfect storm is that business owners have been reading negative news for the past three years.  Almost every ounce of positive energy has been tested and the European ‘crisis’ is exacerbating the problem.  Europe is a major trading area for British products.  If we can’t sell to Europe, some of our businesses can’t grow.  And if they can’t grow, they can’t spend.  And if they’re not growing, they’re not creating jobs.  As I said, the perfect storm.

But there is a HAPPY ENDING… There are many opportunities for marketers and businesses in the current economy.  As marketers we must understand what is happening and what is driving it, so we can spot those opportunities and help the businesses we work for.  As we improve our knowledge, we can better target customers who are spending and we can create better products and services for which there is a need.  Sales and Marketing have never been so necessary than right now…and we have a real part to play in the recovery.

Younger generations are rejecting corporates and demanding CSR and transparency in light of the banking crisis that led to the recession.  Simultaneously older generations are turning their backs on the banks and looking elsewhere for their funding and investments.  And, it seems, the power is really starting to sit with the people.  Bring it on!

In the past few weeks alone, I’ve read a number of articles and spoken to various clients about crowd funding sites and ideas, so it’s clearly gaining momentum.  Here are just a few of the areas we’ve seen:

• The Times reported that prviate investors are now looking to social enterprises for investment; increasing their returns to as much as 6% and knowing their money is invested in worthwhile causes.  Visit www.buzzbnk.org for further details.
• Abundance Generation is a ‘building society for low-carbon technology’ where people can invest as little as £5 into renewable energy schemes.  It’s expected these will return 5%-9% per annum.  See https://www.abundancegeneration.com/ for more
• Funding Circle matches investors and businesses; giving small businesses access to funding at realistic rates and providing a higher return for investors.  A client of mine is using this method to build up credibility and financial history in a non-banking arena – smart move I suspect.  See http://www.fundingcircle.com/ for more.
• Thin Cats operates at a more serious level; funding projects from £50,000 to £1 million and they promote themselves as ‘Business Loans without Banks’.  Visit http://www.thincats.com/

I know we all love to hate the banks.  And I love that our society is creative enough to find a solution without them.  I only hope it gains ground and attracts serious businesses and investors who can create wealth and jobs through this additional funding stream.  That’s the kind of idea that will get our country out of recession.

The first thing to realise is that both articles are factually correct – based on the related research and statistics:

• A ‘recession’ is when the country shows negative growth for two three-month periods in a row.  (A piece of information we didn’t know until the recession happened and now it seems even our pets have a grasp of this concept.)
• Consumer confidence is much more difficult to measure.  And it’s based on a diverse range of factors including ‘perceived wealth’, the weather, an individual’s mood, people’s work situations, people’s family situations, the local high street and community activities, the local Council… the list is literally endless.

The word ‘perceived’ is one of the most important both in the context of the paragraph above and also in marketing as a whole.  Perception is a very powerful thing… if we perceive we are better off, then we act that way.  And the opposite is also true.  So you have a number of people who have benefited from the recession through decreased mortgage payments, but they perceive  the country to be at risk, so they save that extra money instead of spending it (as they would have done prior to the recession).

Unfortunately for the UK, the same thing is happening at a country level, caused by the knock-on effect of the so-called ‘European Debt Crisis’.  Countries outside Europe ‘perceive’ Europe to be a risk at the moment, so they may choose to do their investing elsewhere.  If they do invest here, they expect higher returns for the ‘perceived’ risk.  Simples!

But what does all this jargon and hyperbole mean for your business?

Well.. it depends how your customers perceive themselves and their position.  If they are busy / wealthy, they probably feel OK and are willing to spend and invest their money.  If they perceive they are doing poorly, they will be saving their money and cutting costs where possible.  If you don’t know how your customers are feeling right now, you should perhaps be trying to find out.

Good luck – and shout if you need assistance.

If your budgets have been cut, please don’t think that signals an end to your marketing campaigns – it simply signals a start to your creativity.  And it might force you back to basics.

There are many marketing tools you can use which are free or very cost-effective.  Here are our top seven, based on the methods we believe offer the best returns:

1. Follow-up.  I’m like a broken record with this point – but follow up is free.  It generates sales.  And most people never follow-up properly.
2. Keep in touch.  Yet another method which is free or cheap.  Keeping in touch with old customers can generate income very quickly – we just proved this with one client; selling a £250,000 property off an email newsletter (without so much as a viewing).  The newsletter cost us very little and generated a great return!
3. Positive Attitude.  This one definitely doesn’t have to cost you anything, but you’d be amazed at the difference it can make to your profits (or your wages, if you’re employed).  If you believe you will sell more products today, you will.  It’s a fact.
4. Referral Marketing.  Helping others promote your product, or offering affiliate schemes can be incredibly cost-effective and can generate amazing results – just look at the network marketing companies, Amazon’s affiliate scheme and others for some great examples of this marketing method.
5. Networking.  This can be a great marketing tool, if you set targets and know what you want to achieve.  Networking with the right people who offer complementary products to yours is the place to begin.
6. Up-selling and Cross-selling.  Offering customers additional products or upgrades at the point of sale can generate incredible sales.  It’s suggested that up to 30% of people will accept an upgrade at the point of sale – would you like to go large?  I certainly would!
7. PR.  If you have a story share it.  And use it in as many places as possible – your newsletters, your website, in the local press… The key is making sure you have something newsworthy and interesting.  (Tip – your customers don’t really care if one of your staff is pregnant or if you have a swanky new office.  They care what you can do for them, so keep on track.)

I’m sure there are more and I’d love to hear your thoughts.  I’ve deliberately left social media out, as everyone’s talking about it at the moment and I believe there are simpler methods that deliver better results right now for the time you need to invest.  Comments are welcome though if you disagree.

Happy marketing!

For more details and to view the adverts for yourself, visit:

http://www.dailymail.co.uk/tvshowbiz/article-2121645/Mad-Men-season-premiere-screen-real-Sixties-adverts-ad-break.html and http://www.digitalspy.co.uk/ustv/s157/mad-men/news/a373432/mad-men-to-air-alongside-retro-60s-adverts-on-sky-atlantic.html

If you visit https://adwords.google.com/o/Targeting/Explorer?__u=1000000000&__c=1000000000&ideaRequestType=KEYWORD_IDEAS#search.none you can have a look at the tool and discover what people really type into Google.

You can type different phrases into the box at the top of the page and then search on those phrases and see how many people use them.  Google will produce a report for you which gives you the data for your chosen keyphrases and they’ll also suggest other phrases you might want to consider.

The report will tell you how many people search on a given keyphrase each month globally and locally (UK).  And it will also tell you how many sites compete for that keyphrase – which is important data about your competitors and your chances of getting to the first page in Google for any given page.

Top Tip… If someone calls you and tells you they can get you to the top of Google for a given phrase, run it through this tool and see how many people are searching for that phrase.  If it’s a low number, then a monkey could probably get you to the top of Google for that phrase, but it still wouldn’t bring you very much traffic.  This is one of the latest marketing scams, but now you have the marketing knowledge, you can catch them out at their own game.

Have a play around and enjoy finding out what people really search on!

And it seems even the world of football is following this trend and tapping into the power of their customers…

I recently read about Murcielagos FC in Mexico; a team which is managed by the crowd who make decisions about strategy, substitutions and best players.  The team talk is made public and fans can vote on whether they agree with it.

The team is apparently performing very well…http://abiteof.com/2011/03/17/who-needs-a-trainer-when-you-have-a-crowd/

You don’t ask them any questions.  You might record their telephone number.  And, worst case scenario you lose the scrap of paper containing their details over the coming weeks.

Whatever the reason (or excuse) you don’t follow-up.

What if they haven’t received the brochure (trust me, it happens on a frighteningly regular basis)?  What if they’re interested and are waiting for you to call?

It isn’t the customers job to remember to do business with you – it’s your job

Most customers take on average seven points of contact before they buy.  And most sales people give up at 5 points.  What’s even more scary is the number of businesses who don’t follow-up at all – despite the fact that it’s free marketing!

So what is best practice with follow-ups and how can you really make the most of incoming enquiries?  Here are our top 5 tips (most of which are free or cheap to implement and could be done very quickly):

1. If a customer calls, have a script to follow and find out as much information as you can
2. Gain permission to follow that person up and ensure they received the information they wanted
3. Answer enquiries promptly – be available by phone and email and respond where possible within 24 hours
4. Record all the information you take in a database (ideally customer relationship management – CRM – software)
5. Diary a follow-up and stick to it (and then diary another)

If people take time out of their busy lives to enquire about your product, they’re paying you a huge compliment.  The least you can do is treat that compliment with respect and try to help the customer towards a solution.

Sites such as Groupon and Living Social have sprung up seemingly overnight.  Voucher Codes offers discount codes for everyday items, such as shopping, meals out and clothes.  Martin Lewis’ money saving expert site is also full of discounts and deals – and they’re proving more popular than ever.

It’s very easy to think of joining the bandwagon and adding your deals to these sites, but how can you do so profitably?  Here are our top tips from our experience and that of our customers:

1. Ensure you’re making a profit.  The number of people we’ve met who have created deals that lose them money is frightening.  Deals are not about no profit.  They are about great deals that attract new customers and make you a good return.  Look at added-value, rather than discounts.  And if you can’t make money, don’t offer the deal.
2. Try to use a site that will help you reach new customers.  If you can attract new people to your business, it could be worth a reduction in profits on their first visit.
3. To achieve a long-term growth in business and profitability, you must keep a database of these new customers and then market to them directly.  With hotels and restaurants, you save approx. 20% commission if people book directly, so encourage as many as you can back to stay with direct offers.
4. Ask for reviews.  One hotel that we work with has been rushed off their feet with Groupon deals and it’s been really hard work.  But the reviews they’ve received on Trip Advisor (and the database they’ve built up) has been worth slightly lower profits on these first visits.
5. You must impress the people who use the vouchers.  If you’re happy to take a smaller profit margin on the first visit and see this as a marketing expense for finding new customers, you must generate a profit at a later date.  If they are impressed, they’re likely to return… and they might recommend you to friends as well.

To see what might be next for the Daily Deal sites, look at http://www.thinknear.com/main_pages/how_it_works

It’s all very exciting!