On a visit to Scotland this weekend, we called in at our favourite carvery pub for a very quick meal and, whilst eating, I did some numbers and was staggered with the marketing approach they were using and the resulting turnover in their business.

They have a number of things working for them, which are critical to any successful food offering:

1. Location.  They are on the main road from Glasgow to Loch Lomond; making it easy to call in and also attracting people who are in a rush (and won’t take up a table for long).
2. Location.  They’re opposite a Travelodge which doesn’t serve food.
3. Location.  They’re very close to the city and have a huge amount of potential local trade, as well as passing customers.
4. Price.  They offer a carvery for £3.99 per person.
5. Speed.  It took 15 seconds per person to be served the meat of their choice; meaning 240 people could be served in an hour.  Customers self-serve their vegetables.You pay up front and don’t have to queue and your plates are cleared as soon as you finish your meal.
6. Quality.  The food is fantastic.  It’s hot, tasty and it’s giving people in Glasgow their five a day!
7. Upsells.  Desserts and drinks are on offer and the table has up-sells for breakfast and other meals to entice you back… brilliant.

By my reckoning, serving 240 people an hour (in a place that seats about 100 people) means you’re turning the tables twice an hour and each person spends an average of £5.

That’s a turnover of £1200 per hour.

You might be thinking… well I bet it isn’t that busy all day long.  But the waitress I spoke to had been working since 10am and we arrived at about 6pm.  She said it had been as busy all day long and it was always that way at the weekend.

It’s cheap and cheerful…but it works.  They had no shortage of customers wanting to buy and you don’t see so many people in one place very often in the current economic climate.

Markets are where it all started… trading your goods for those of someone else.  It was considered a privilege to be granted a licence to hold a market in your town and people travelled from miles around to trade with each other.

And the essence of marketing still lingers on when you visit your local market…

• Product – you receive instant feedback as to whether your product is in demand.  The way you display your products is important and you’ll sell more if it’s appealing.
• Price – instant feedback again – are people buying or not?  If not, you can change your price instantly.  The fruit and veg sellers are fantastic at this and will alter their price throughout the day; knowing they have to move as much stock as possible whilst it’s at its freshest and can demand a higher price.
• Place – Some positions on the markets are hotly contested…it’s all about location, location, location.  Where is the highest footfall and which streets attract more of your ‘target audience’?
• Promotion – I love the bustle of a marketplace.  Sellers promoting their wares and trying to catch your attention with shouts of ’10 for £1′.  As the promotion is verbal, it can be changed many times throughout the day and the regular traders will know which ‘promotions’ or headlines work best

I usually visit the local market wherever we travel in the world and have been impressed by the presentation of products in Spain and France, but the noise and bustle of the marketplace is more exciting in the markets of England and Africa.

This really is marketing back to it’s roots and its worthwhile revisiting what you do in your business – and whether things have become unnecessarily overcomplicated.

Customers usually buy something new or swap brands because they are dissatisfied.  Most don’t leave because of price – the main reason they leave you is actually because of ‘perceived indifference’ – they thought you didn’t care.

In fact, almost 70% of customers switch brand or supplier for this reason – so you need a number of strategies in place to help your customers get to know you, like you and trust you, and to let them know you are grateful for their business.

With Christmas on the horizon, have you ordered your Christmas cards and gifts?  Are you planning on saying ‘thank you’ to your top customers and your top referrers?  You should also include your suppliers and staff – anyone on your team who has helped build the business this year.

If you weren’t planning to send a card or gift this year, what would it take?  (If you don’t say thank you in the middle of a recession, when will you?)

If you aren’t sure whether it’s worth saying ‘thank you’, we’d ask you to work out how much additional profit you’d have made this year if each of your customers had just stayed with you for one more month.

Would you like to be known as the person who buys on price?  Known as the friend who owns the cheapest products or buys the cheapest services?  Talked about as the boss who hires the cheapest staff?  Referred to as the customer who always demands the cheapest price?

For most people, they don’t want to be the person we just described.  (If you do, you’re reading the wrong blog!)  They maybe want to be known as the person who hunts out a bargain, and gets a great deal, but not the person who only wants the cheapest.

We all know that you get what you pay for – in most instances.  Some people have no choice but to let budget decide what they can buy – but they still want the best value (regardless of price).

If you’re still in any doubt as to whether people buy on price, ask yourself this:

If you had to have brain surgery, would you pick the cheapest surgeon – or the best?

Let me illustrate today’s post by starting with a question…

When you buy baked beans, do you choose any brand of beans, or will only Heinz do?

This question usually splits our seminar audiences in half.  For my family; only Heinz is good enough and I won’t buy any other brand of baked bean.  But why?  Especially when people (the other half of our audiences) tell me cheaper beans taste the same?

It’s because most of us don’t buy on price.  Emotions and perceptions are a very powerful tool – and that’s why blue-chip organisations spend a fortune building their brand.  Mr Heinz himself was famous for the acid test of branding – his vision was that any person entering a supermarket looking for a Heinz product but unable to find it would leave the store and shop for it somewhere else.  If all your customers did that, how powerful would it be?

So, if we don’t buy on price, what makes up our mind?

Risk is actually the major issue for most buyers.  Your product or service must represent the lowest risk (or the most safe and secure purchase decision).  People don’t like change and, buying from you for the first time represents change.  So they need some reassurance that your product won’t make them look foolish, or they won’t regret the purchase.  This is much more important than price or quality.

So, instead of labouring over the price of your product, think about how you can reassure customers and maybe shoulder some of the risk they’re taking.

The Marketing Mix (or the 4 Ps) is one of the most important marketing models, as it helps you look at different aspects of your business and ensure each one is working well.

This is what the model looks like:

PRODUCT, naturally, concerns your products and / or services.  Do you provide the products people are looking for and what problems do they solve?

PRICE, concerns your pricing structure and what you sell your products and services for.  This area of the marketing mix is also concerned with ‘market price’ – are you cheaper than your competitors, or more expensive?  How do you know what the market is willing to pay for your product?  Can you be sure you aren’t under (or over-) charging?

PLACE, is about distribution – having your products and services available in the right place, so customers can find them.  This also concerns delivery, logistics and timing.  Distribution strategies are considered in this section – could you increase your customer base through the use of agents, wholesalers or ecommerce?

PROMOTION, is the area of marketing most people think about when they hear the word ‘marketing’.  (It’s also the reason why so many companies say they are ‘marketing’ companies, but they never actually get involved in product development, pricing structures or distribution strategies.)  Promotion is all about telling your customer you (and your product or service) exist and selling the benefits to encourage them to buy.  This area of marketing can be really creative, but it’s only of equal importance to the other three parts of the model.

Take a look at your business – and your marketing plan.  Do you have strategies to improve each area, or are you focused on the ‘pretty’ bits and avoiding the sharp (or financial) end of marketing.

Tomorrow we’ll cover another three P’s – a development of the marketing mix which is specifically relevant to organisations who sell services.