Marketing is often seen as a dark art.  And I think practitioners sometimes over-complicate it and use acronyms and large words to increase the perceived value of our skills.  But I would rather take the approach that more people understanding marketing is good for the economy, as it means more sales for more businesses.  As marketers, we have a crucial role to play in spreading our knowledge for the benefit of everyone in the UK.  So here goes…

A = Audience

Everything in marketing begins with your customer.  What problem are you trying to solve for them?  Who are you trying to sell to?  What do you know about them?  What motivates them and what would encourage them to buy?

The more you know about your customers, the easier your job becomes.  So do your homework – this isn’t a section on which you should be relying on guesswork.

B = Brilliant Marketing

OK…I had to make it fit my ABC!  Your marketing mix is the step between working out who your audience is and deciding how you will reach them and with what messages.  This brings into play your product benefits, your pricing, your promotion and your distribution strategies and it flows from the information you know about your customers.

Ideally, you should have products that solve problems for your chosen audience, pricing that will be attractive to your prospects, your products/services available in places your audience shops and promotion in things they see or read using messages that are relevant to them.

C = Conversion

There is no point to marketing unless you’re converting sales… and this is the bit many marketers forget or wimp out on.  But if your actions aren’t leading to profit, someone should be questioning them.

A good friend of mine once told me that marketing is what you do to get the phone to ring and sales is what happens when you pick up the phone and it’s a great distinction.  And you need both elements to have a successful company.

So there you have it…the ABC of marketing.

I look forward to receiving your feedback and comments.

It seems the world has gone ‘coupon-crazy’ and everyone is looking for a deal.  In some respects, you can understand why – as people’s lifestyles are squeezed, they want to keep as much as they can and therefore have to pay less for what they used to take for granted.

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!

Recommended business is the holy grail of marketing… if someone recommends your product or service, you must have done such a great job for them that they’re willing to tell their friends and contacts.  It’s truly the sign of a good business if you get most of your work through word of mouth referrals.

What most business owners fail to recognise is the risk to the person who recommends you:

They put their own reputation on the line by telling their friends that you’ll do a great job. 

And most people don’t do that lightly.

We had a friend give us such a recommendation for someone to respray our campervan recently.  The business was effectively his; we just needed him to see the camper so he could give us a quote.  And that’s where the problems began.

So here’s a list of what not to do, if you want more business:

1. Make it difficult to see the client and give them a quote
2. Make the customer come to you
3. Be vague about times you’ll be there to see them
4. Leave them waiting outside your offices for 30 minutes
5. Put the phone down on them (after telling them you’re not really bothered about the work)

It beggars belief that in the current economic climate, small business owners are still wasting opportunities and damaging relationships with the people who recommend their company.

We’d love you to share if you have similar stories of people who talk themselves out of business.

Reciprocity is a powerful thing and it can take years to build up a great relationship with someone.  It’s power is that people with whom you have a good relationship generally recommend you, use your services time and again, give you testimonials and actually care about you and your business.

Like I said…the holy grail.

But some of us take those relationships for granted… at our peril.

Take an example a friend shared with me last night – she met an insurance broker a few years ago whom she liked and their company now looks after all of her business.  She has never in that time shopped around for insurance, or used comparison sites.  A few months ago, she was due for renewal and at the same time, she realised it was the broker’s daughter’s birthday.  So she sent a personal email wishing her Happy Birthday and mentioning her renewal needs, but she didn’t receive a reply.  Her renewal papers came from someone she didn’t know.  And now she’s considering shopping around.

There could be a really great reason the email wasn’t answered – the broker could have been away / ill / might have left the company / it may have been answered by another member of staff who didn’t realise the depth of the relationship.  But whatever the reason, the relationship has been damaged.  And it’s been proven that 67% of customers leave because of ‘perceived indifference’ – they think we don’t care.

According to a report ‘Loyalty: A prescription for cutting costs’ by Fred Reichheld of Bain & Company, in the financial services sector a 5% increase in customer retention produces more than a 25% increase in profit.

It’s time we realised that people think they’re important – and they are.  We need to treat all of our customers,  introducers and suppliers as individuals and respond to them and their family in a way that shows we care and that we’re grateful for their business.  It’s hard work – of course – but it’s easier than continually finding new customers!

I heard on the radio yesterday that the land used for Glastonbury is usually home to just 350 cows… So I wondered how on earth they cram 140,000 people into that same space for a few days every summer.  And what encourages people to attend; knowing it’s going to be heaving (and possibly very muddy).

Set up by a dairy farmer in 1970, the festival started as a harvest festival and fair.  In the first year 1500 people attended and paid £1 to see Marc Bolan and T-Rex.  The ticket price even included some milk from the farm (according to the official website – http://www.glastonburyfestivals.co.uk/history/).

Last year, the event celebrated its 40th anniversary.  135,000 people attended and they paid £185 a ticket.  That’s quite a difference in 40 years!  And, crucially, the growth has been driven by the customers…

Founder, Michael Eavis, has tried to end the festival several times, but the customers kept on turning up.  And it was the customers that seem to have driven the festival into profitability.  Despite himself, Mr Eavis created something people really wanted – and were willing to pay for.  That’s the secret of great marketing – and the rest is history!

Figures released this week show that high street sales have continued to grow this month, despite concerns that consumers would lower spending after the Royal Wedding and the Easter bank holidays.  This is great news for retailers – and also for those of us watching for the green shoots of a post-recession era.

And in the same week, Groupon has announced an initial public offering and is seeking to raise £460 million.  The company now reportedly* has 83 million members in 43 different countries and offers products and services at hugely discounted prices.  The offers are typically available for a limited time and a minimum number of members have to take up the offer for everyone to receive it.

One of our hotel customers recently ran a Groupon offer and the phone started ringing at 5am on the morning it went live.  They pulled the phone out of the wall at 12 midnight, as it hadn’t stopped ringing for the whole 19 hours!  Whilst that sounds amazing – and this is certainly a new craze worth investigating, we would advise caution with any vouchers and coupons.

Our top tips include:

1. Ensure the offer is compelling, but that it also makes you a profit.  Discounts and vouchers should not cost you money – that’s bad business.
2. Remember the commission – Groupon typically charges 30-50% and that’s a significant chunk to work into your calculations
3. Include a deadline / use-by date.  This encourages people to act quickly and will ensure customers can’t still be claiming their £5 off in 5 years.
4. Use something more interesting than 10% off – that’s a really dull offer and is massively over-used.  As a result, most people don’t even take notice of 10% off discounts – they’re everywhere.  So get more creative.
5. Capture everyone’s details, so you can contact them directly next time (with their permission).  If you’re attracting new customers, you need to find ways to attract them back – at a lower acqusition cost in future.

Try some different vouchers / coupons / offers and monitor which works best – then do more of them.  It seems to be working massively in the current economy.

*http://www.bbc.co.uk/news/business-13636363

Up-selling is marketing jargon for selling customers something else in addition to the original product or service they are purchasing.  The most common examples are protection insurance or extended warranties, but we experienced up-selling at a cinema last night which worked really well…

It was our tenth wedding anniversary last night, so my husband and I went out for a meal and then watched the romantic movie ‘Iron Man 2′ at our local cinema.  The up-sells went as follows…

• When we booked our tickets, we were asked if we wanted to upgrade to VIP seating.  This cost just £1 extra per person and meant we sat in a leather chair in the centre of the cinema.  Of course, we said ‘yes’.
• We also purchased a large Coke and some Minstrels – which we don’t often do, but that was a further £6
• With our tickets, we were handed a voucher to return to the cinema and receive money-off in the next two weeks – likely to be the Shrek movie!
• The cinema also had an agreement with the restaurant next door – which happens to be our favourite restaurant, so we received an unexpected 20% off the food bill (meaning we spent more, of course).
• The restaurant offered us desserts and more drinks once we’d finished eating; something not all restaurants do but it’s great customer service and it sells more product.

These are simple tips and techniques that any business could use – and they are incredibly effective.  On average 30% of people will say ‘yes’ to an up-sell.  So if you aren’t asking, you could be missing a huge chunk of profits.

I must share with you an example of a down-sell from last night too… we went into a local pub for a whisky and were looking at the selection of single malts.  When we asked if they had any more to choose from, we were offered ‘house’ whisky, which was only £2.50 for a double – not quite what we were looking for!

Legend has it that if you place a frog in a pan of boiling water, it will jump straight out.  But, if you place it in a pan of cold water, and slowly warm the water, it will happily sit there and boil.  Whilst we haven’t scientifically proven this is the case, (for obvious reasons) we believe it’s because the poor frog doesn’t notice the changes around him.  But how many business owners fall into the same trap?

For example…

• Barnes and Noble were busy expanding their network of stores as Jeff Bezos was creating Amazon
• Blockbuster recently sold their European arm with debts of £660 million.  They are now looking to modernise and improve their digital and mail-order business, but at what cost?  Their shares; once worth $28 are now valued at just 41 cents
• USwitch was also sold recently, at an estimated loss of £356million, after their turnover halved and their losses quadrupled in 2009.  Their competitors confused.com and gocompare may or may not offer a better service, but were perhaps better at marketing?

The cost to your business can be tremendous if you assume things will stay the same.  In fact, the only constant in business is change – so ensure you look up every now and again and take a look at what’s happening for your customers, your industry and the countries in which you operate.

And… if you don’t have time, then pay someone to do this for you.  There are opportunities out there that could make you a fortune, if you take advantage of them – and there are threats which could cost you a fortune, if you don’t spot them in time.

As the recession continues into 2010, we take a look at the trends we’re expecting this year – and the opportunities that are presenting themselves for businesses positioned to take advantage:

1. Be Honest.  The trend towards Corporate Social Responsibility looks set to continue – which is great in my book.  Consumers are demanding more transparency and honesty and, as a result, more customers are shopping locally again and using suppliers they trust.
2. Mobile Internet.  Teenagers are increasingly using mobile internet, rather than fixed line broadband.  This trend looks set to continue with the increase in mobile phone technology and, if you’re targeting teenagers, it’s something you need to be aware of now.
3. Niche Markets.  In marketing, we used to work off Pareto’s principle – 20% of your customers typically brought you 80% of your business, so you would focus on what that 20% wanted.  But the internet is changing the rules and giving people an endless choice.  As a result, niche marketing can now prove very profitable – particularly since you can tap into niche’s worldwide at the tap of a button.
4. Self Employment.  Throughout last year, many companies down-sized and made people redundant.  Consequently, business start-ups are increasing, as people choose to take their fate into their own hands.  The growing number of start-ups will provide endless opportunities for some companies.
5. Wellness.  Baby Boomers remain a significant proportion of our economy and they have always driven trends.  Now approaching retirement age, they don’t want to grow old and they don’t want to end up in care (as they’ve seen their parents do.)  They are therefore driving a ‘wellness’ revolution for anti-ageing, exercise classes, cosmetic surgery etc. to keep them young.

Check back tomorrow for another 5 trends to watch this year.

We visited Caernarfon this weekend and popped into J & C’s Chippy on Pool Street for a fish and chip lunch.  We ate in the cafe upstairs and, when our order was taken, we were asked if we wanted mushy peas.  My husband said ‘yes’ straight away and I hesitated (I never have mushy peas).  The owner reassured me they were home-made and said you couldn’t have fish and chips without them – so I agreed (and they were fabulous).

That very simple up-sell generated 90p extra per person; an additional £1.80 on our order. The cafe sat 28 people – even if only 25% of customers accepted the upsell that’s an additonal £6.30 every time the tables are turned.  Do that just once a day and you make an additional £189 per month and over £2000 in a year. 

We spoke to the owner at the end of the meal and he told us that almost everybody accepts the up-sell, so his figures will be much higher than those in the example above.  He also told us that Caernarfon was heaving in the summer, so they probebly turn their tables at least four times a day – not bad, for the sake of a simple sentance.

What could you ask in your business that could generate an extra 90p per sale?

Thanks to J&C’s for the example above – if you ever find yourself in Caernarfon, we can highly recommend the fish and chips – and the mushy peas!