Is Common Sense The Real 6th Sense?
I attended an Anthill entrepreneurs night in Melbourne this week, 60 people in a room all with big ideas and trying to wrestle them into a success story. Some were gorgeously young and naive, some of (us) were a little older, more experienced and a lot more circumspect. What we heard from the young and enthusiastic 'entrepreneurial speakers ranged from: "the key to success is (wait for it)....being prepared to work hard" ....to...."if I was launching a restaurant today, I'd artificially inflate the price of a meal and then discount it on Spreets", because "traffic is everything." Entrepreneurial experts? Should we be worried? I think the audience was smart enough to know that sometimes even the most 'clever' of us say some pretty stupid things. Let's look at "traffic is everything" first. The dynamos of online and social media spruik that instead of talking to a prospect 'one to one', we should find ourselves talking to a mass audience. That can be great if we're selling chicken nuggets or diabolical if we've had a glitch in our booking system (Jetstar). The scale of opportunity today is very much the domain of the mass marketers. Is that you? It's certainly not me! How much traffic volume does your business need? I can't see the rationale for driving the masses to your website or Facebook page if you're selling to up to 500 clients a month, why focus on talking to millions? Of course, 500 clients a month demands a steady flow of prospective clients and therefore convertable traffic to your business. The volume of which has to do with your conversion rate. The less enquiries you can convert, the more you need. Should you concentrate on improving your conversion rate, or simply drive through more traffic? I fear that driving through more and more traffic, you get caught up in the task rather than focus on the true business objective. And driving SEO and social media to the masses is indeed an onerous task that takes time, time and even more time. Time you could be doing something else more targeted - using SEO and social media - talking to the people who matter to you most. Is that everyone? How do you use Social Media to talk to the 200 people you want to reach now? That my friends, is really the $64 question. 1. Cultivate a quality database 200 of the right targets is of far more value to you, and enables you to manage the task of personalising and targeting your communications so more effectively. Go to the effort of ensuring your database is truly valuable to you. The right people, their right details and their particular area of interest as it relates to your business. How on earth have I got on the mailing list of a dozen specialist accounting software companies? Obviously to some companies, wastage is just the cost of volume marketing - they don't care. But I do. You do harm every time you send an ill targeted communication. And when you do it over and over again - I'd call that harassment - or that's how it feels. So you're unlikely to get my business - but you're also unlikely to get my referral. I liken poorly targeted online marketing to the 20 telemarketing calls we get a day for switching telecommunications providers.........%$#@!?% 2. Think 'exclusive' rather than 'inclusive' An 'off centre' posting from one of your 200 fans on Facebook does more harm to the credibility of your page than you'd think. Keep the conversation relevant to your business and your 'real' customers. Linkedin forums have found a way to manage the focus of the discussion by ensuring only the right people can join. Those forums are the best for coherent exchange without stupid, irrelevant distraction. Consider this simple management protocol for your own Twitter, Facebook and LinkedIn 'forums' - don't invite everyone to the party - just the ones you want to be friends with. 3. Fashion your message Don't be dragged into the trend of driving your business to meet the needs of the masses. A more targeted approach is likely to be more successful. Make sure the message you are sending is at least of interest to the recipient, and at best, a real solution to their problem. You can do this is you take the time to manage to whom you are speaking. Old fashioned? Or just common sense? How does this get lost in social media marketing today? Now, for the second piece of mischief - lack of authenticity. When you set your prices, do so with some respect for your clients. Artificially inflating a price to make the discount larger and more appealing is short term thinking....and best described as malevolent marketing. Your customer is not stupid. Price is traditionally determined by demand and settles into position according to competition. Margins are smaller when there are more competitors in the market. However, burning customers who purchase a product or service in good faith, is certainly not the right foundation for the making of a successful business. So beware of the temptation that Spreets and Groupon etc offer. Get involved when it makes sense for your business and be authentic with your customers. How much margin is right? Despite its hefty price tag, the real margin on a Louis Vuitton handbag is no where near what you'd assume. Hand finishing, selective materials and the rarified, highly skilled and manufactured environment where you buy it make the $2,000+ bag a big investment surely. However, it is likely to outlast your $100 Target special by a lifetime. You just have to like the design for a lot longer! That's also what you pay for - longevity. Does your product or service offer longevity? Your product must be priced correctly to enable you to deliver it well to your customer and follow it up with good after sales service. A client must be able to see the value in the price - which is often only really discovered when something goes wrong in a week or 6 years. Your steak undercooked? Your goods damaged in transit? Your widget came off the wodjet? Your advice following a campaign? What do you want - the response from a company that doesn't have the margin in its goods to provide adequate training and customer service for its customers? If that margin instead goes into the owner's pocket, or there just isn't the margin in that cheap price, then you have a problem. You need enough margin in your price to ensure your customer will return and purchase again. Have a look at your prices and consider if you have included in that squeezed profit margin, enough money to ensure if something goes wrong, you have your client's back. And lastly....... To be fair, you do have to work hard to be successful. Some of us have to work harder for longer than others though. That's why we're still in the room ;) AnneMaree Fitzgerald - www.marketme.com.au