It’s official. The year 2012 has rung in. Based off of vastly different types of speculation, some crazy and some not so crazy—you hear 2012 will either bring you:
- The end of the world and of all civilization as we know it, or…
- More turbulent economic conditions
But there’s a third scenario of circumstances that you rarely hear anyone ever talking about that doesn’t involve doom and gloom.
It’s prospering and making 2012 your most successful year to date, regardless of the circumstances.
In my opinion, no, the world probably will not end. But the current economic conditions are something you can count on to continue.
In this blog post, I will be showing you how to get your business ahead in this economy by making sure you track your marketing efforts and showing you how to keep a healthy flow of customers or clients streaming through your doors year round.
To begin lightly, testing and tracking your marketing efforts are the two most critical things you can do when you practice effective marketing.
If you have ever tried marketing your business by going directly to an advertising agency, you would know that they do not provide any means of tracking your sales.
Their job is strictly just to sell you advertising and that’s it. So you’ll have track and test your efforts yourself.
The difference between marketing your business without tracking and testing then marketing while tracking and testing results, is like night and day.
It lets you see exactly what works so you can do it again, and what isn’t working so you can stop doing it.
Let’s face it, in this economy it’s actually a foolish decision to ignore a tactic that gives you the best chance to get the highest return on your investment.
It would potentially be like throwing your money down a garbage disposal.
So here are some great tracking methods that successful marketing savvy business owners use:
Tracking Method #1: Coupon Codes
If you’ve ever ran a special sale or promotion for your establishment then you may be familiar with the usage of coupons.
So when you start a campaign for promotion in multiple avenues of communication, label your coupons with distinctive codes, each code unique to a means of marketing.
The difference is that with this particular method, you know exactly from what avenue the coupons originated. This is very helpful when your coupons are for specific services or individual items.
Tracking Method #2: Database Marketing
Database marketing is very basic, yet the information it provides is incredibly invaluable.
It’s essentially the practice of marketing to your ideal prospect with their best interest in mind. You can start doing this by collecting the names, addresses, e-mail addresses of your current customers and prospects.
But don’t stop there.
When they are in your establishment making purchase, be sure to document what they bought, when they bought it, and how much they spent.
These three figures are critical, and let me tell you why.
When you know this information, the task of getting them to make future purchases will be a little easier.
You now know their buying habits.
Do they come in more frequently, or do they wait a longer period of time between visits?
Do they opt to buy the big ticket product or service? Or do they prefer to spend their money on smaller less expensive products and services?
You now know how they buy, and this is a great acknowledgment to have when you want to sell them something else.
So use this information to target your customers or prospects when selling a product or service.
When they’ve been in regularly, sell them a product or service similar or the same to what they bought last time.
When they haven’t been in in a while, initiate a customer reactivation campaign we went over in the last issue, by extending them a special offer also similar to what they used to purchase.
The next most critical aspect of marketing effectively is testing your marketing efforts.
If you’re already making an investment to get more business, wouldn’t it be smart to make sure that you’re getting the highest result you possibly can out of your effort?
Yes, so test everything.
Test your offers against each other, test your potential USPs, test your sales letters, test the headlines, benefits, and call to actions in those sales letters, test your guarantees, even test your testimonials.
Testing is a great practice to take part in as you market your business, because you find out the type of communication that your market best responds to.
There are three main practices of testing your marketing.
Testing Method #1: A/B Split Testing
Split testing is essentially the practice of testing two of the same subjects against each other, and seeing what performs best. Like two different sales letters, post cards, advertisements, Unique Selling Propositions, or two different guarantees.
A/B Split testing is normally utilized when one both subject A and B are both from two separate angles, or appeals.
For example, you want to take out an ad in a magazine, but aren’t sure whether a personals style ad would perform best or a classified ad style would be best. You would then test them against each other.
Testing Method #2: Fine Tuning
After you’ve determined a winner between your split test, the next step is to start fine tuning your winning subject.
Test and tweak the components of your subject, in this case it would be the headline, benefits and the call-to-action.
This is great foundation for long term advertising strategy.
When you go to fine tune your advertisement, sales letter, or post card, make sure you are only changing one component at a time.
Change the headline, and run it again. Document the results.
Change or reword a benefit, and run it again. Document the results.
Do not change multiple components at once, because when you get results you won’t know what caused the change in them.
Testing Method #3: Using a Control Group
Depending on what means you are marketing by, you will have to use some type of control group or method to get the best results before you start scaling upwards.
This is essentially taking a precaution so that you don’t break the bank on a bad marketing tactic before you knew it was no good.
So if you are marketing by direct mail then send your split tests only to smaller control groups first, not your entire list. You can fine tune your mailer to these groups as well. This is optional.
If you are advertising in a magazine, you would only run your ads for a shorter period of time as you split test them.
After you choose a winner, you would keep the ad running for a longer period as you fine tune it.
Doing well in this economy isn’t only hinged on the practice of tracking and testing your marketing. You should also really know some foundational keys to marketing effectively.
I’m talking of course about the invaluable metrics of your average customer lifetime, and average customer value.
Invaluable Metrics: Average Customer Lifetime and Value
Your average customer lifetime is how long your typical customer or client stays with you.
Your average customer value is how much your typical customer or client spends with your business during their average lifetime.
When you calculate this statistic you can immediately know how much you can afford to spend to attain each new customer or client.
For example, if your average customer spends $1400 over 2 years with your business, then you could afford to spend $1400 to bring in each new customer and still break even.
Spending anything less than that would result in profit.
The trick to making this simple enough to leverage this metric to grow your business is to look at it this way:
You want to get the highest average monthly customer value possible. When you do this, odds are you’ll succeed over your competitors.
Having the highest average monthly customer value also means that you can spend more than your competitors can to acquire a new customer or client.
I said that I’d tell you how to get your customers and clients to keep circulating back into your business.
Improving Your Client or Customer Retention
There are a few basic ways to improve your customer or client retention.
The one way is to consistently create new offers to keep your customer or client base interested in your business.
This is for the fact that in virtually every market customers and clients will probably end up asking an establishment, “What else you got?” after a few visits.
They know where you’re located, they know what you offer and they know how it helps or satisfies them.
But the reality is that they won’t get in their car to come buy from you if you don’t switch it up every once in a while.
The reality is that they may get bored with an establishment if they haven’t seen anything new in a while.
This is why you should use your current products and services to formulate a new, value-based offer every few months.
Be creative and innovative in order to make your new offer attractive and compelling.
For example if you own a retail clothing store, you could incorporate an offer like getting 25$ off when you spend $100. Or get 50% off of outerwear when you buy one article regularly priced.
Another example is the $5, $5, $5 deal by Domino’s Pizza. Every Tuesday of each week you can get 3 medium-sized one topping pizzas for only five dollars each.
Creating offers like these also give you the excuse to contact your customers to sell to them.
So when you’re creating fresh new offers for your market, you can tie in holidays or special events during the year to assist in their success.
This includes Christmas, New Year’s (like this issue!), St. Valentine’s Day, St. Patrick’s Day, Fourth of July, Halloween, the superbowl, black Friday, cyber Monday, Cinco De Mayo, etc.
This is very eminent in the fast food industry. One great example is Burger King. When the King Kong movie debuted, they released The Kong Burger: a colossal-sized hamburger.
When you have these potential tactics in mind, it can really help to plan out their execution in advance.
Sit down and decide when you’d like to release what types of offers, or launch what types of promotions during the course of the next year.
That’s about it. Tough economic times are the best times to profit. The only question is if you’ll act quickly enough…
Look out for my next blog post where I’ll help you achieve a high monthly customer value by showing you how to increase your average transaction size, for no marketing cost.