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Revenue Generating Systems Many turnaround leaders have failed because they focused so much time and energy on the expense reduction side of fixing the system. When they were finally able to lift their head above the cost-cutting project, they realized their sales revenues were in a steep decline, many of their top sales and marketing staff had resigned, and there were no viable products/marketing strategies of which to build the new business around. Turnaround programs have a way of getting very expensed oriented. In other words people seem to focus on cost cutting above all else. While this is very important and I'm not denying that you should not engage in a very aggressive cost-cutting initiative, as already stated in many of the other previous turnaround steps, I am sure that you have also head the adage "nothing happens until something is sold"! Peter Drucker has said business has only two functions -- marketing and innovation. It is safe to say that sales and marketing is the engine that powers the entire business. So then to ignore marketing during this crises time then is very dangerous. In the same token, the first criticism that comes up when talking about developing an aggressive marketing program is the high cost that marketing programs carry. What then is the solution to this dilemma of needing to market aggressively but having very "stretched" financial resources? I'm personally of the belief that one of the greatest return on investments that a business can make is in marketing. However, that means intelligent, well thought through, strategic marketing. And not the typical process of throwing thousands of dollars out there in hopes that something will work. The following is a marketing (and sales) program that I recommend you follow during your 100 Day Business Transformation Process. You will find it practical, based on best demonstrated business practices, low cost, and very effective. Steps to transform your marketing systems so that you strategically reposition your products and services. Try this exercise, list 50 reasons why someone should do business with you versus the competition. Not easy is it. I'll bet you were not even able to come up with 10!! And therein lies the basic problem with most marketing approaches by the majority of businesses…especially distressed businesses. Did you know that if you have developed strong and overtly stated benefits (not features) for your products/services you will increase your success by 292% verses weak or nonexistent benefits? Did you know that if you have developed something called a "reason to believe" and effectively communicated it in your marketing message you will increase your success by 233%? Finally, did you know that if you have developed a significant difference in your business versus the competition and effectively communicate that to your customers and prospects, you will increase your success by 353%? In other words, if you have taken the strategic steps necessary to develop strong overt benefits, a reason to believe, and a significant difference in your business then you will increase your success by close to 900%!! By the way, Doug hall, a marketing expert wrote a great book titled "Jump Start Your Business Brain". You will find this research in his book and many ideas to reposition your business. How to reposition your business Start by looking at your primary product/service and list features & benefits. You most likely know the difference between a feature and a benefit. Benefits are what's in it for the customer. A benefit is what your customer receives, enjoys or experiences in exchange for his time trouble trust or money. Features, on the other hand, are the facts, figures, technology and details that make up the structure of your product or service. Benefits answer the question which every customer either asks directly or indirectly "what's in it for me"? Turning Features into Benefits: Step 1: Make a list of all defining features · List the attributes, ingredients and dimensions that define why you are as you are · Focus on both what you offer and how you deliver it to customers · List the obvious points of difference between you and your competition · List the less obvious but still significant points of difference versus the competition Step 2: Transform each feature into a benefit · Relentlessly ask the why questions of each feature: · Why should I care about this feature? · Why did you create this feature? · Why is this feature important? · Why is this feature necessary? · Why doesn't the competition have this feature? Step 3: Review current marketing materials for features & benefits.
Real Reason to Believe The benefit is what you're offering. The reason to believe is how you're going to make good on your promise. To succeed, you need both the what and the how. Need some good examples in how to communicate Real Reason to Believe? Watch Infomercials! They start from a position of poor credibility with potential customers. For this reason, successful infomercials utilize over half their time communicating Real Reason to Believe. They do this by providing visual demonstration, "skeptic conversation" testimonials and common sense explanations of how the product works, as well as detailing the expert pedigree of the inventor of the product. Practical Tactic: Learn from the masters of Real Reason to Believe- Watch infomercials with a conscious awareness of Overt Benefit and Real Reason to Believe. With paper & pencil, keep a scorecard of the Overt Benefit promises as well as the Real Reasons to Believe used to provide supporting credibility that the benefit will be delivered Pictures have a power that transcends words. Turn the sound down for a while and watch the pictures. Can you see the Overt Benefit? Can you see the Real Reason to Believe? Score Your Real Reason to Believe vs. Competition Step 1: Gather the materials that detail your brand, business or concept. Also gather similar materials on your competition. Step 2: Make a list of each element of overt communication that enhances credibility for you and your competition. Step 3: Add to your list and that of your key competitor the unstated things that should give customers confidence. Step 4: Match and compare. Cross out the first item on your list. Then find a credibility item on the competitor's list that is of equal impact and cross it out as well. If it takes two from one list to equal the credibility of one on the other list, then cross out two for one. continue to cross items off each list until only you or your competitor is left standing with items still on the list. What you have just done is close to what goes through customers' minds when they are trying to make a decision between you and your competition in a head-to-head decision situation. Some examples of reason to believe
Dramatic Difference Sales and profits explode when an Overt Benefit and Real Reason to Believe pair is offered with a Dramatic Difference. When you are unique, you stand out in the marketplace. Dramatic Difference is a 2 step process: First, customers evaluate whether you offer meaningful uniqueness versus existing options. Second, they evaluate your price versus existing options. Evaluation of Dramatic Difference is how customers decide if their purchase decisions should be based on value or price. When there is no perceived meaningful difference, then price becomes the primary if not exclusive decision criterion. Practical Tactic: How to Know a Dramatic Difference When You See One The natural tendency is to exaggerate differences based on minor distinctions that are irrelevant to customers. How relevant is your point of difference? For a Dramatic Difference to be successful, it must be based on a combination of Overt Benefit and Real Reason to Believe that is relevant yet unexpected- relevant in that it has meaning, purpose and applicability to customer needs; unexpected in that it is novel, unusual, original, unique, new and different.
To maximize relevance, your Dramatic Difference must flow directly from your Overt Benefit and Real Reason to Believe pair. The only difference that is important to customers is one that impacts the experience they receive. Thus, relevance is linked directly to the connection between Dramatic Difference and Overt Benefit/Real Reason to Believe.
· Do you have clear news to tell your customers? · Is your idea new to your company? · Is your idea new to your region of the country? · Is your idea new to your industry? · Is your idea new to your country? · Is your idea new to the world? Once a business has determined its Overt Benefit, Reason to Believe, and Dramatic Difference you now have a unique selling proposition (USP) or strategy necessary to implement effective marketing programs. Using these inputs, we are now going to move into several high impact marketing programs to maximize your business success. 10 Marketing mistakes to avoid In order to have a powerful marketing program, you must first avoid these all to common marketing mistakes. (from Jay Abraham's "10 Marketing Mistakes to Avoid"). Mistake #1) Failing to Test: If you don’t test prices, headlines, advertising copy, radio/TV spots and verbal sales messages, you won’t know what the market wants, or what it will pay. You’re just guessing – which can be disastrous. Tomorrow, I urge you to have your salespeople try different pitches and differently priced offers, then review how they do, one test against the other. If you find a new twist that out-closes an old one by 25% - 50%, have all your reps use that approach until you can test and compare even more – and potentially better – possibilities! Mistake #2) Running Institutional Ads: Institutional ads are a sheer waste of money, because they don’t direct the reader, viewer or listener to any intelligent action or buying decision. Direct response advertising, on the other hand, makes a complete case for the company, product or service. It overcomes sales objections. It answers all major questions. And it promises results, backing up the promise with a risk-free warranty or money-back guarantee. Mistake #3) Not Stressing Uniqueness. Most successful businesses and professional practices are built around a single USP, or “Unique Selling Proposition.” It might be reliable post-purchase service, super fast delivery, convenient hours – or something else. Think about what it is that sets you apart from your competitors, and then make that “USP” the engine that drives all of your marketing and advertising efforts. Mistake #4) Not Having Back-End Sales. The back end is vital to any business. If you can induce new customers/clients/patients to buy a similar product or service from you within 45 days, you double the value of the customer. All of a sudden you’re far into profit, instead of what initially was probably a net loss. Mistake #5) Failing to Address Customer Needs. By communicating with your customers (and making sure that your employees do the same thing), find out what it is that people need/want most – and then make sure you satisfy that need. If it’s the lowest possible price, give them that. If you don’t genuinely fill the needs you purport to fill, your customers will soon abandon you. Mistake #6) Failing to Educate. Your customers and prospects won’t understand or appreciate a bargain, service or benefit unless you point it out to them. Example: If you’re overstocked with widgets, advertise that fact (admitting your mistake) and then explain why the widgets are valuable, how they can be used, and how you are willing to let them go at a major market discount to 1) either your best customers, or 2) first-time customers, or 3) people who are willing to make an additional purchase. Mistake #7) Making Customers Work Too Hard. How easy is it to find things in your store? How helpful are your telephone operators when a customer, client or patient calls with a question? How easy is it to order from your business by mail? Mistake #8) Failing to Explain Why. Whenever you make an offer, ask for a sale, run an ad, or offer a product or service for sale at a specific price, always explain why. For example, why can your salespeople handle my purchase better than someone else? Why can you beat your competitors on price? The more believable and plausible your reasons, the more compelled I will be to favor you with my patronage. Mistake #9) Giving Up Too Soon on What Works. I find that business people get tired of their advertising and marketing campaigns long before the marketplace tires of them. If you fell into this business “sin,” you might call off an advertising campaign that was working and replace it with something that hadn’t proved itself and, in fact, might fl op. Test different concepts and approaches, but never abandon your “control” (i.e., best performer) until you find something that pulls better. Mistake #10) Forgetting Who Your Customer Is. Always send your sales messages to the people who are your primary prospects. If you want to reach people over 45, for example, your ad’s headline should say, “If you are 45 or over…etc.” Scrupulously avoid headlines and ads that are nonspecific or abstract.
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Copyright 2005 Christian Counsel for Companies |