Customers... Do you really know who they are? Part 2

Knowing who your customers are will only get you so far. Once you know them, you have to keep up with them, or rather stay one step ahead of them so that they stay your customers for a lifetime. You can accomplish this in 3, easy (okay not so easy, but totally doable) steps!

1. The first thing any small business owner should do once they get to know their customers on a personal level is continue to build and gain their trust. As mentioned in part 1, the more customers trust you the more they will reveal about themselves personally (as it pertains to your products). One way to do this is through the use of a "loss leader" or a "freebie". This helps solidify to your customer that your interactions are more than transactions, they are a collaboration of "friends." In my industry, I do not want the Chief Marketing Officer of a Fortune 100 company to consider our relationship a transaction. I can't afford for that to happen so I always make sure to invite them to other conferences for free as my guest, not as a speaker or panelist. In this way I can demonstrate my personal relationship with them by offering them a chance to come to an event on a topic that they expressed interest in during our casual conversations. Most times they accept and even when they don't they appreciate me focusing on them, going beyond "good service" and closer to "good friend." This way I can continue to tap them as a resource to continue to gain personal insights about them as customers. As a small business owner you can use yourself as an example of how important trust is. The next time one of your "suppliers" comes by for a sales visit, see how you feel about opening up personally. If you feel like you are willing to open up to them, you can provide first hand validation of my point, and you can also see just how effective some salesman really are.
2. After you build trust with customers and have gained a personal relationship with them, you need to use that information to reach new customers. The most effective way to reach new customers is through the creation of a single global marketing message based on similar personal factors. By this I mean using the personal information you mined from your customers to create one consistent message that never changes at its core. For example, in my organization, putting on high-level corporate events is what we do, but we market that only high-level corporate people will be in the audience, which makes our events more peer-to-peer than our competitors. Therefore we focus our marketing message on this peer-to-peer aspect based on the idea of like minded people wanting to interact with other like minded people. Despite the fact that we put on events that span all aspects of business and every inch of the country our message is that it will always be peer-to-peer. While this may seem like a simple task because our target group is so focused, it is no different than what McDonald's does with its "I'm loving it" campaign or Nike did/does with "Just do it".
3. By now you may be noticing that a key to effective marketing is understanding that customers are similar. This "key" is both true and false because while human sensibilities are diverse, but what consumers want is not. A global theme like "I'm loving it" or "peer-to-peer" plays to the similarities, while how we convey that message plays to the diversity. In this way you can bring back in the dynamics of personal customer information and continue to break it down into smaller and smaller units. For example Nike manages to market shoes to older people by focusing on the quality of their product and how durable it is so that you can always "Just do it." While at the same time they can market to younger people by focusing on individuality and allowing them to "Just do it" their own way. In this way they market to two completely dissimilar customer segments with the same single message. However in order to reach these groups they have to know that young people are personally motivated by uniqueness, while older people are more likely to be focused on quality.

As a small business owner you may never be able to market as effectively as Nike or McDonald's, but getting to know why your customers come to you, may get you closer to "over a billion sold!"

Customers... Do you really know who they are?

With all the things small and medium sized businesses must focus on, it is easy for things to get overlooked. One of these is knowing exactly who you are selling to. If you ask most small and medium sized business owners, they would likely give you a target group, demographic or market segment. However, if you asked them to describe in detail a target customer by combining more unique or personal factors of specific customers, they would be hard pressed to do so. This lack of pinpoint focus on who an organization’s customers will sure to limit their ability to market even the most life altering, must have product, effectively.

In my position of coordinating conferences, I interact with some of the most influential Chief Marketing Officers in the country on a daily basis. Knowing who their current and potential consumers are is one of the key points that we always end up discussing. This involves a very complex process that most small and medium business owners cannot afford to do at the level it needs to be done at; however, it does not mean it should be ignored. Reaching out to your customers and building relationships with them, so they are open to sharing personal information process will allow you to gain an insight in to their behavioral trends and psychographics in the same manner Fortune 500 companies do on a mass scale. While this sounds like a daunting process that most small and medium sized businesses don't have the skills, resources, and human capital to delve that deeply into (congratulations if you do though), getting to know your customers can be done by every business.

Furthermore it must also be remembered that getting to know your customers is an ongoing process. Throughout your organizations life span, the product or products you sell, along with the needs, wants and interests of your consumers will change. However a successful company will maintain enough flexibility in its marketing so that it can grow and accommodate the changing demands of their consumers. This can only be accomplished by reaching out to them and by building relationships with them. By considering the interaction between your business and you customers as more than just a sales transaction, you will afford yourself the chance to learn your customers. It is pivotal to develop a relationship with them so that you are able to ask customers honest questions about their spending habits, current interests and what they are noticing about your business as an outsider looking in. Obtaining this type of personal information will allow you to gain an insight in to their behavioral trends and psychographics in the same manner Fortune 500 companies are able to do on a mass scale, but for a lot less.

Marketing Dollars and Sense: Spending effectively today to market for the future (Part 1)

In 2009 most companies scaled back on marketing expenses in an effort to control costs. For most companies the decision to cut marketing was a bang-for-the-buck decision, or more formally a return on investment (ROI) decision. When a company goes to cut costs, anything that doesn’t make dollars doesn’t make sense and for most companies without appropriate controls and measurements marketing is a hard, and often high, cost to justify. While cutting marketing expenses is certainly not a bad decision it should not be a permanent decision. Every company should spend some money on marketing, but the key is to find ways that help them spend effectively.

In the world of small businesses marketing as a practice usually falls into two categories: all or nothing. As we all have seen there are those small businesses out there that bombard the marketplace with marketing. These companies are run by owners who feel marketing is a salesman they don’t have to pay commission to. They send out fliers and e-mails and maybe do a radio or TV ad and they maybe buy a billboard or two or ten. This group typically is aiming for mass appeal and follows the adage that it takes 7 pieces of marketing before you can make a sale or generate business. I work for one of these companies. I do not insinuate that this is a bad strategy in any way. Our sales guys tell me all the time that this type of marketing is actually effective in our industry. The main reason is that there are so many competitors in our market that it is important to keep our name on top of the junk mail pile. Repetition leads to familiarity which leads to direct association which leads to picking up the phone and calling our company when their convection oven breaks. Without that constant stream of mail and e-mail and what have you our company name gets forgotten as easily as the name of your waitress at dinner (I mean really how many of us can honestly say you remember the waitresses name from the last time you ate out?) However as the VP of Finance for the company I am only concerned with ROI and when sales are off by… let’s just say they are off, it is hard for me to see how this strategy is truly effective for the long term survival of the company.

On the other side of the spectrum you can find the nothing group. These are the organizations run by owners who think marketing is a waste of money and who feel a stack of business cards and a good reputation in the industry is all you need to succeed in business. In this category marketing is no more likely to bring business into the office than would a casual conversation between a satisfied customer and a friend or colleague looking for the same service. This group typically is aiming to satisfy existing customers and create total loyalty. I also work for one of these companies. I definitely cannot insinuate that this is a bad strategy either. I know that for the particular nothing marketer I work for, marketing expense this year was a whopping $300 (primarily for business cards). In fact even if you add in the holiday gifts being sent to clients (which is but isn’t marketing), the total marketing costs for the year are less than $2500, or less than 0.5% of total costs. Yet despite sales revenues being only off slightly, the operations side of my job makes me wonder how long this strategy can be truly effective.

Seeing both sides of the spectrum leads me to ask the question: “How does an all marketer or a nothing marketer become more effective at managing its marketing habits?”