Allstate Gets It

Dennis HaysbertYou get your new insurance bill, and grumble about the rate. You’ve grumbled every month when the bill comes, but today you’re especially irritated. “I wonder if I’m overpaying,” you mumble as you walk to your computer and search for “auto insurance.”

You go to the first site, and click on the “get rate” button. Whatzzis? You want me to register to use your site? Why do I have to register to get a quote online? Amazed, you look for an answer. A couple of clicks later you find this explanation:

* The online Rate Quote uses personalized pricing data. We use a one-time registration process to make sure we keep confidential data confidential.

* It takes only 2 minutes to register, and within 24 hours you’ll be set up and ready to receive personalized rate quotes and lots of other customized information to make your use of our web site easier.

These points constitute an answer?

I don’t want to use your web site. I just want to know what it will cost me to insure my car. You won’t tell me what your premiums cost without me telling you who I am? Why do you need to know that?

I know what this is all about. You’re going to send some salesperson to pressure me to buy from your company. I’m not sharing anything with you.

And with that, you go back to your search engine to try some other site. Pity. You still don’t know what the first company charged, and now you’re not going to say anything positive about them, are you?

Maybe it wasn’t insurance you wanted pricing on. Maybe you were searching for a gift for your mother, or checking the price of a rental car. Or maybe you’d actually found something you wanted to buy, but they won’t let you put anything in their shopping cart until you open an account. Have you ever had this particular experience?

It must have happened to Jim Whimpey and the Brisbane Creative Team. They’re parodying useless accounts at a site appropriately called Useless Account.

Every Obsticle Costs Sales

Here’s a truism: everything that gets in the way of your customer is going to cost you sales.

  • Should you hide the $20 jeans featured in your radio ad to see if anyone asks for them? NO! You should place them prominently and count how many you sell.
  • Should you charge your customer’s credit card, then tell her the item is back ordered? NO! You should inform the customer that the item can’t be shipped for a specific number of days, and not charge her card until you’ve actually sent the item.
  • Should you “capture” visitor information so that you can add one more name to your mailing list? NO! You should give people the information they’re seeking, and then let them choose to associate with you.

Now, the good news. Allstate gets it. Allstate’s newest television ad* is delightful. Here’s the script:

Say you want a hot dog. You go up to the vendor and you ask “How much?” He says “Give me your name and social security number.” Humm. You probably won’t buy from him. So why put up with it when you’re looking to buy car insurance on-line? At Allstate you can get a ballpark estimate without even giving up your name. Go to the new GetAllstate.com. Without even giving your name or Social Security Number you can compare different car insurance options and levels of coverage and get a ballpark estimate. Then, if you like the price, you can go on to get a full, personalized quote with an option to buy on-line. People who switched to Allstate saved an average of $338 per year. Log on to GetAllstate.com now and see how much you can save. Protecting you should start with protecting your privacy. That’s Allstate’s stand. Are you in good hands?

You’ll be pleasantly surprised at how many of your prospects take the bait, online or off, when you make it easy for them. And that bait is critical when you’re fishing for customers. .

Your Guide,
Chuck McKay

Marketing consultant Chuck McKayYour Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

Got questions about uncovering the obstacles to letting people buy?  Drop Chuck a note at ChuckMcKay@FishingforCustomers.com. Or call him at 760-813-5474.

* Article written and originally published May 15, 2007. Obviously no longer Allstate’s newest television ad.

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The Truth About Recycled Ads & Pickup Lines

Swipe Files / Headline Banks

Have you seen those ads for “headline banks” or “swipe files?” Collections of the 100 greatest advertisements of all time so you don’t even have to learn anything about marketing or advertising. You just have to copy these “proven ads” and you will, of course, have success.

If you believe that.

You know, you’re going to get about the same one hundred ads from every one of these suppliers and they’re all approaching one hundred years old, because those are the ads that the copyrights have expired on.

And seriously, these were great ads when they came out.

Great Advertising Examples

Max Sackheim’s ad for Sherwin Cody’s home study course in the English language was brilliant: “Do you make these mistakes in English?” You know, that ad made money for Cody for over four decades, and they never changed the copy ’cause it just kept on working. This was a great ad.

John Caples classic for the U.S. School of Music, “They laughed when I sat down at the piano, but when I started to play…” In those years leading up to the great crash of ’29, when money was easy and confidence was everywhere, thousands of (largely rural) Americans looked at this and thought, “Hey, maybe the key to becoming popular is mastering a musical instrument.

Then there’s the Wall Street Journal ad that asked, “Who else wants to get promoted?

No Thinking Necessary

The idea is you take your name and put it where their name used to be, and you put your offer where their offer used to be. And now you run the ad.

And because these ads were so brilliantly written they’re going to pull in hundreds of thousands of sales for you.

For your heating and air conditioning company.

For your family restaurant.

For your income tax service.

If you believe in magic.

Here’s the reality. Those ads were so good because they were designed to work in a specific time, in a specific market, against specific competitors, in specific media… and none of those conditions exists anymore.

So, recycling somebody’s old ads makes as much sense and recycling old pick up lines, for pretty much the same reason.

He: “Do you make these mistakes in heating and air conditioning repair?”

She throws her drink in his face.

He: “They laughed when I sat down at Mom’s Family Diner, but when I started to eat…”

She throws her drink in his face.

He: “Who else wants to file Schedule A with their long form 1040?”

She throws her drink in his face.

Here’s What Really Works

Find out what your potential customers are already talking about, and join in on that conversation.

He: “If you wake up every morning with a backache, maybe it’s time for a new mattress.”

She: “Tell me more.”

Stop Using Other People’s Ads

You can’t afford to lose any sales, and the right bait is the right information for your customers, at this point in time, in the medium you’re choosing, against the competitors you’ve got.

Yes, there are magic words, but they’ll be unique for your company. And you need that kind of powerful customer bait when you’re fishing for customers.

Your Guide,
Chuck McKay

Marketing consultant Chuck McKayYour Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

Got questions about expressing the specific values and advantages of what you sell? Drop Chuck a note at ChuckMcKay@FishingforCustomers.com. Or call him at 760-813-5474.

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Beer And Headaches And That Awful Cramping

Originally published February 24, 2006
Chuck Blore once told of a study he did for CBS. Beer drinkers were surveyed as they entered his testing facility. They each proclaimed a preference, as well as an explanation of why they they had chosen that particular brand of beer.

The participants were then given tasting cups, and were told to help themselves to any of the 20 beers available for comparison tasting.

As they finished and were leaving the testing facility, the participants, all 104 of them, were again surveyed as to their preferences.

Interestingly, not a single participant had changed his or her mind. Each had found validation in the actual testing that the beer he or she had preferred on the way in was indeed more robust, or smoother, or lighter.

Blore never told them that all of the samples were exactly the same.

His conclusion: Advertising makes beer taste better.

What Would You Take For A Headache?

If you were suffering from a headache would you be more likely to take Midol Menstrual Formula® or Excedrin Tension Headache®? If you were suffering from menstrual cramping which would you be more likely to take to relieve your symptoms?

They each have the same active ingredients: acetaminophen and caffeine.* My conclusion: Effective advertising makes pain manageable.

But notice something else at work, here. By limiting themselves to headache relief, or to menstrual pain relief, aren’t the makers of Excedrin™ and Midol™ (McNeil Consumer & Specialty Pharmaceuticals and Bayer Corporation, respectively) limiting the number of sales they could make to people with backaches, toothaches, or sore muscles?

Absolutely they are.

They will probably make no sales to those people. And it doesn’t matter.

Name three other products marketed for the relief of menstrual pain. Go ahead, I’ll wait.

I’m waiting.

OK. Were you able to name three? Two? Most of us named only one.

Why Specialization is Valuable

Now, which would you rather be, one of a dozen products for general pain relief, or the one product that comes to mind when a customer is suffering a particular ailment?

By specializing and becoming the solution to a specific problem, you automatically become the most likely choice of consumers who are experiencing that particular discomfort.

When customers ask for you by name, you’ve succeeded at genuine branding. The lack of branding is the single biggest reason most business advertising isn’t as effective as it should be.

Your first step getting them to ask for you by name is to help shoppers figure out what they get from you that they can’t get from anyone else.

What is it? You sell the same products. You deliver the same services. What differentiates your business from those of your competitors? Why should anyone think of you as the solution to their problem?

Well, why should they?

The perfect solution is also the perfect bait when you’re fishing for customers.

Your Guide,
Chuck McKay

Marketing consultant Chuck McKayYour Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

Wondering how to articulate your value as a solution? Drop Chuck a note at ChuckMcKay@ChuckMcKayOnLine.com. Or call him at 760-813-5474.



* The active ingrediants are acetaminophen and caffeine. Midol Menstrual Formula® also includes 15 mg of Pyrilamine maleate, a diuretic to relieve water-weight gain.

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Bar Bands and Chicken Sandwiches: Protecting Your Brand in an Age of Social Conscience

Scott is a musician. Scott’s band isn’t getting enough paying gigs. He thinks he has a marketing problem, but he’s wrong. He has a focus problem.

Scott came to me to help him sell his band’s services to club owners. I pointed out that 40 years ago bands got $700 a night; 20 years ago the going rate was $500. Today, a local band playing a local club can expect $275-$300 a night. I wondered if competing for a greater share in this dwindling market was a wise move.

A Critical Question

I asked, “Do you get enough personal satisfaction from performing songs you like in small venues that you’re willing to do it for free?

Scott opined that he’d prefer to be properly compensated for all the years invested in refining his musicianship.

This is a key factor. If a musician’s desire is to play his music his way is his most important consideration, how much money he makes becomes secondary. But, if he wishes to run his band as a real business, he’d be better served to examine the market.

Customer Focus Is Good Strategy for Musicians (and Every Other Business)

Any service provider can study the market and provide services people are willing to pay more for. Alternatively, should he not consider the desires of his customers, he can provide the services he wishes to offer.  Of course, he’ll then be forced to accept whatever engagements come his way.

Satisfy his own desires?  Satisfy his customers? Common sense, and thousands of case studies indicate that customer-focused businesses make more money.

Scott’s next step will be to identify well-paying niche markets, and to explore the kinds of music most wanted by that niche.  Will it be private parties for local businesses? Grand openings and customer events? Events hosted by fraternities and sororities? Meetings and conventions?  In that order, each pays progressively more money.

Which Market has the Greatest Number of Profitable Opportunities?

How will he know what to choose? Through their previous purchases his potential niche will have indicated their willingness to pay a premium.  If he stays focused on delivering exactly what his customers want, I predict he’s going to do well. In fact, the longer his focus remains unwavering, the resulting word-of-mouth will make it progressively easier to sell his services.

In this era of YouTube, the 24-hour news cycle, and this country’s current political climate it isn’t only musicians who need to keep fulfillment of their personal gratifications secondary to unwavering customer focus. It’s also critical to companies that produce ice cream, chicken sandwiches, coffee, snacks, clothing, and even fitness services and cancer treatment.

Social Responsibility Complicates the Messaging

Some socially responsible actions reinforce a company’s brand.

Starbucks commitment to Fair Trade coffees complements their image as a producer of high priced gourmet coffees.

And Patagonia’s insistence on selling only eco-friendly products rings true with the company’s obvious love of nature.

These are the core values each of those companies has communicated to its customers, and upon which each company has grown.  Every successful brand is built upon principles. Those it stands for.  Those it stands against.

Not everyone will care about a company’s passions (or even its products), but there’s no better way to attract a loyal customer base than to say, “The values you believe to be important are our values, too.”

Ben and Jerry’s support of Occupy Wall Street seems to be a natural outgrowth of their well established counter-culture values. Customers will likely understand, and may even approve.

Merck and Company’s development and free distribution of Mectizan to treat river blindness in Africa, Asia, and South America is a brilliant positioning of Merck as a developer of drugs to help people.

But what about Pagagonia’s contributions to Planned Parenthood? The tie in isn’t so obvious. Customers may see the connection when the company explains that slowing population growth is completely in line with its commitment to preserving the planet, but without the explanation, it’s less likely.

Not all social values resonate in harmony with others which the company, or its customers embrace, and as a marketer I can tell you how difficult it is to make a simple message stick in people’s minds.

Two messages? Too confusing. A second message which requires explanation? Waaaay too confusing.

In my experience, a confused mind always says, “NO.”

Confused Marketing is Bad Marketing

It’s also bad business practice.

The list of advertisers that seem to have let social issues divert their attention from focus on their own customers is long, and growing. A handful of examples of this discontinuity include:

  • Starbucks support of Washington State’s proposed Marriage Equality law does not reinforce its image as a producer of high priced gourmet coffees.
  • Chick Fil A’s contributions to groups which oppose that law have nothing to do with serving fried chicken sandwiches.
  • Nabisco’s creation of the Rainbow Stuffed Oreo could be considered a natural outgrowth of their other recent creamy center options. Not making it available in stores makes it clearly about something other than manufacturing snacks.
  • At best, these moves confuse the message. Worse is the danger they alienate customers who embrace different values.

    The Greatest Danger is Damage to the Brand

    Susan B Komen For the Cure‘s withdrawal of funds for Planned Parenthood’s cancer screenings contradicted it’s brand image of being for women and against cancer. The public uproar which resulted wasn’t assuaged by the restoration of those funds.  In hopes of mitigating the damage, founder Nancy Brinker has stepped down as CEO.

    GoDaddy’s support of the Stop Online Piracy Act, which would have allowed Internet service providers to shut down sites accused of infringing intellectual property (and do so without a trial) looks suspiciously like censorship to small website owners. Amid the backlash, GoDaddy withdrew its support.

    Should Companies Take Positions on Social Issues?

    Absolutely. When the issue is aligned with the company’s core values, it will resonate with the beliefs of like minded consumers. If taking a side reinforces the company’s brand, responsible companies take sides.

    But when that social issue contradicts those core values, or confuses the messaging, there will be negative repercussions. And a CEO who uses his company to promote contentious social issues instead of focusing on the products and services his customers expect is as foolish as musicians performing for their own enjoyment. They each send a clear message that what’s important to customers doesn’t matter. What matters is what the company wants.

    These Are Potentially Big Decisions

    Many of these issues are tied to current politics. Conventional political wisdom is one third of this country will consistently vote Conservative, one third will always vote Liberal or Progressive, and the final third (the “Undecideds”) will choose on an issue-by-issue basis. So, for political issues brought to the front by companies such as Starbucks or Chick Fil A, one third of potential customers will automatically embrace their values, and another third won’t care.

    Of that final third, not many will feel strongly enough about the issue to discontinue shopping with them.  Perhaps that number is only one out of three.  That works out to one third of one third (roughly 11 percent) of existing customers and potential customers avoiding future business with those companies.

    Eleven percent.  That’s a lot. In some markets its the difference between the top seller and number two or three.  In this economy it could be the difference between profitability and cutbacks.

    If I were a shareholder in your company, I’d want you to protect and nurture my investment. Act like a musician who only wants to play his favorite songs, pissing off 11 percent of our customers in the process, and you’ll find me working to get you fired at the next shareholders meeting.

    Your focus has to be unwaveringly on what customers want.

    So, Companies Should Avoid Controversy?

    Hardly. Controversy is an easy way to promote top-of-mind awareness, and share of market is closely aligned with share of mind.  A controversy which reaffirms the company’s image may well create more, and even more loyal, customers.

    However, when the CEO’s social conscience doesn’t align with the core values upon which his brand has been built, he should contribute directly, and leave the company out of it.

  • The late Carl Karcher’s donations to the anti-abortion group, Operation Rescue, came from his checkbook, not from Carl’s Jr.
  • Curves founder, Gary Heavin, has given generously of his personal money to organizations which promote abstinence-only programs for teens.  No bad feelings among Curves members.
  • Jeff Bezos’ recent $2.5 million contribution to Washington’s Marriage Equality law came from his own pocket rather than from Amazon.
  • All followed their consciences, while never wavering in their respective customer focus.  None experienced any negative customer backlash.  Whether or not we agree with their positions, business people who separate their companies’ actions  from their personal agendas tend to be admired for their integrity.

    The Issue isn’t Abortion, Abstinence, or Marriage

    The issue is branding.

    Your company’s brand is it’s professional reputation. It’s the sum of customers impressions, and the feelings they get when they use your products or services. Your core values drive your brand, because at its core, your brand is a promise to consumers that their realistic expectations of your company will be met at every dealing.

    The CEO’s job is to make that promise simple. His job is to make sure that every communication and every interaction with customers and potential customers delivers on that brand promise.

    When the very things customers admire about your company are the reason you’re taking a political stand, they will proudly recommend you to their friends.

    But, if you gained loyalty by providing great products or services while remaining socially neutral, do not change your brand promise. That only confuses customers, and makes them angry.  When a customer buys ice cream, or coffee, or chicken sandwiches, she wants the best tasting ice cream, or coffee, or chicken sandwich available. When she opens her purse for a book or a cookie, or she donates money to your cancer research fund, she wants to buy your products, your services.  To support a cause she believes worthy

    She doesn’t want to be forced into a situation in which your recently announced ideology doesn’t align with her values.

    You shouldn’t want that either, when you’re fishing for customers.

    Your Guide,
    Chuck McKay

    Marketing consultant Chuck McKay</a>Your Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

    Could aligning with a social issue benefit your company? Drop Chuck a note at ChuckMcKay@ChuckMcKayOnLine.com and start a conversation.  Or call him at 760-813-5474.

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    Coffee, The Moon Landing, And A Game Of Poker

    Poker Hand

    A winning poker hand.

    I don’t play often, but I appreciate a good game of poker. Poker makes a pretty good analogy for marketing, and for business.

    Poker players know what they hold in their hands, they carefully watch what everyone else appears to be doing. They make educated guesses as to the cards the other players hold.

    Poker players hoard their resources until they know they hold a winner, then they confidently apply all of their resources to winning that particular hand.

    At the end of the game the winner takes the whole pot. The loser loses everything.

    The other players pick up a few bucks now and then and manage to stay in the game.

    In real life marketing the winning hand is held by the company with the greatest share of mind. Let me give you an example.

    Name the First Brand of Coffee You Think of

    Now name another.

    Can you name a third?

    Chances are that you named your first coffee brand rather quickly.  The second came almost as quickly.

    Most people take slightly longer to name the third brand.

    Most People Purchase the First Brand that Comes to Mind.

    Would you like to see how 3,000 other people* answered that question?

    Share of Mind for Coffee

    Share of Mind for Coffee

    People remembered these brands in roughly the same proportion they buy them.

    Conclusion #1: Share of mind predicts share of market.
    Conclusion #2: The first name that shoppers think of is the one they buy.

    How does a company become the first name on the customer’s mental list, and thus hold the face cards in the marketing poker game?

    The Easiest Way is to Actually be First.

    Who was the first man to fly solo across the Atlantic? The second? How about the first woman to fly solo across the Atlantic?** Charles Lindberg and Amelia Earhart won those hands. You can’t even name the losers.

    You might remember the second man to set foot on the surface of the moon, but can you name the third?

    Can you name the third expedition to the North Pole? The third Pope? The third signature on the US Declaration of Independence? (How about the third amendment to the Constitution)?

    In share of mind, share of market, and poker, third position is a loser. Winners come in first. Second place sometimes makes a few bucks. Beyond that, money gets very tight.

    “But wait a minute, Chuck” (I can hear you saying), “I have a small business in a small town. I’m not the first at anything.”

    This is Where Marketing Makes a Difference.

    Charles and Frank Duryea built the first gasoline-powered automobile in 1893 – a full ten years before Henry Ford got into the business.*** Henry made the automobile affordable to every household, creating phenomenal word of mouth on the Model T. Henry held the winning poker hand, and became the most famous automobile manufacturer of all time. How many of the losing hands can you even remember?

    The best selling MP3 player of all time is the iPod, but Apple didn’t invent the device. Rio did, in 1998, nearly three years before the iPod hit the market. Rio built an expensive toy for people who loved technology. Apple created a toy for people who love music. Apple wins that poker hand. (And, tell the truth, until I mentioned the name, you didn’t even remember the Rio player, did you)?

    Your objective is to make your company the one that people automatically think of when they need what you sell. When you’re first on that list, they don’t even think about buying elsewhere.

    You see, the first company to make a claim has an 85% chance of being remembered for that claim. The second company has about a 15% chance. The third company less than 5%.

    Ford and Apple simply out promoted Duryea and Rio, respectively. Neither was first in the market. Each became first in the minds of their prospective customers.

    Can You be First at Something?

    Absolutely. In fact, its essential.

    To be remembered, to hold top position in share of mind, to hold the winning hand in marketing your business, you must be first at something.

    I’d suggest that you choose to be first in the reason your existing customers do business with you now.

    Find out what your current customers believe you provide that they can’t get anywhere else. Then, start promoting that. Promote it to the point that you’re now playing in a whole new game, and in this game you hold the winning cards.

    Your Guide,
    Chuck McKay

    Marketing consultant Chuck McKayYour Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

    Have questions about finding a niche and being first in it? Drop Chuck a note at ChuckMcKay@ChuckMcKayOnLine.com. Or call him at 304-208-7654.

     


    * BRANDPOLL survey of coffee brands, January-March 2001.

    ** Charles Lindberg, May 20, 1927; Amelia Earhart, May 20, 1932 on the fifth anniversary of Lindberg’s crossing.

    *** Nicholas Joseph Cugnot designed the first steam powered self-propelled vehicle in 1769. The device was so heavy that it had to run on roadways of steel, and evolved into the modern locomotive. Etienne Lenoir patented the first practical gas engine (coal gas) and drove a car powered with one from Paris to Joinville in 1862.


     

     

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    The Customer’s Buying Process – Systemic Marketing™ Part III

    Tire Sale

    Tire Sale Sign

    There tend to be two schools of marketing. The creative and the scientific.

    Imagination and mathematics.

    Right brain, left brain.

    At least, it looks that way on the surface.

    Marketing Yin & Yang

    Some highly effective marketing uses evocative imagery.

    “Melts in your mouth,”
    “Cleans like a white tornado,”
    or “Where’s the beef?”

    Some is a bit less exciting.

    “click here to learn more,”
    “save 13 cents on your next purchase,”
    “Dear Fellow nature lover.”

    But truly effective marketing uses both. First the math. Then the imagination. First the who, and what. Then the how and why. And that makes sense, doesn’t it?

    A marketer identifies the target market, measures responses, and calculates ROI. Then he provides the creative team with very specific direction: “Here’s what we know about the prospect, what we believe to be her motivation, and the offer we’re going to present.

    The creative folks, the copywriters and art directors, focus on that customer profile. They detail our prospect’s life. They account for her time, her activities, and her choices. They find correlations in her other purchases.

    And then they create “We are Farmers, dum te dum dum dum dum dum,” or “What it feels like to chew 5 gum.”

    But it always starts with detailing, and measuring the buying process.

    Tread Wears, “Blowout Worry” Accumulates

    Eventually, the tread wears down on every tire, and every automobile requires replacement tires.

    In most cases the wear happens gradually.

    An early stage buyer notes that wear is accumulating on her tires. She’ll file that observation away into her subconscious as something that will need attention sometime in the future.

    Her subconscious will, through reticular activation, allow tire ads to pass the mental filter which helps her to tune out the thousands of advertising impressions she’s subjected to each day.

    What Runs Through The Shopper’s Mind?

    At minimum (“Humm. Tires are showing slight signs of wear.”) she knows she can put off the purchase decision. Not feeling any pressure to buy, but aware that it will eventually become necessary, those lower price offerings from Mr. Tire Store Owner will appear more attractive and better hold her attention.

    As the tread continues wearing, she’ll think less about price, and worry more about safety. As you might expect, the closer she gets to “OK… I’m scared to drive any farther on these tires,” the less price acts as the primary motivator.

    Then there are those cases in which the tire catastrophically fails. When that happens, she will make a purchase. Probably today.

    Purchase Trigger

    It may be growing worry. It may be performance failure. It may be because she’s leaving in a week to drive across three states on her family’s vacation. It may be that she came across an unexpected tire sale. It may be an unexpected salary bonus. But something will happen that causes the owner of that car to decide it’s time for new tires.

    We call that event a purchase trigger.

    A trigger is a change in perception on the part of the shopper.  Its the realization that the actual discomfort of NOT owning has become greater than the perceived discomfort in making the purchase.

    Triggers happen to different shoppers at different times, but all shoppers experience similar triggers.

    That’s the fact which allows us to design customer acquisition programs.

    Once we determine a strong appeal to an early stage shopper (say… reduced price), that appeal will be equally attractive to a different early stage shopper next month. Yet another completely different early stage shoper will be attracted with that same appeal the month after that.

    Likewise, the appeal which works to attract this month’s late stage shoppers (perhaps safety, or guilt about safety) will work with other late stage shoppers later this year.

    And when our primary appeal meets with a prospect’s strongly felt need, it acts as a trigger, moving that prospect to the next step, perhaps all the way to completing the purchase.

    What Steps does the Shopper Take?

    The specific shopping steps will be slightly different for every business. Some purchases are made on a whim. Others require research and the approval of a committee. Some buyers initiate purchase orders. Others simply pay cash.

    Our tire shopping prospect likely goes through nine separate steps to buy tires.

    Tire Customer Buying Steps

    Tire Customer Buying Steps

    The Sales Process is Always Similar, but Never the Same

    So far, we’ve described the buying process, which begins with the shopper feeling a need.  Is the selling process the same?

    Usually, its not.

    The selling process begins when the seller identifies the buyer as a new prospect, and attempts to get her to engage.

    And other than advertising, the seller has no control over communication with the prospect until she identifies herself.

    In our tire purchase example the buyer has already taken five independent steps before the  seller knows she exists.

    But detailing the customer’s steps between the first interaction with the seller, and the completion of the purchase, are what allow us to standardize the process.  It’s what allows us to set our marketing on  “Cruise Control,” when we’re fishing for customers.

    Your Guide,
    Chuck McKay

    Marketing consultant Chuck McKayYour Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

    Got questions about detailing your customer’s shopping process? Drop Chuck a note at ChuckMcKay@ChuckMcKayOnLine.com. Or call him at 304-208-7654.

     

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    Reach vs Frequency – Systemic Marketing™ Part II

    curb number

    Curb Number

    A young man shows up at your door.  For only ten dollars he’ll paint your house number in florescent paint on the curb in front of your house. Feeling no need for glow in the dark numbers on your curb, you pass on the offer.

    The next day a different young man makes a similar offer. Again, you refuse.

    He’s followed that afternoon by a young woman with virtually the same offer. Will you buy from her?

    Believe it or not, you’ve just determined whether frequency or reach is of greater importance as a driver of sales.

    Reach Trumps Frequency

    In Systemic Marketing™ – Customer Acquisition on Cruise Control, we discussed the advantages of creating a a Marketing Cruise Control, a system to increase your marketing efforts in slack times and keep your company operating at capacity.

    But the first decision is how to increase those efforts.

    For decades media planners, buyers, and salespeople have argued whether it was more important to reach more people with your message (offer), or to deliver that message with greater repetition to the same people.

    There are good arguments for both, but common sense will guide us to the following conclusions:

    1. The more relevant the message, the more likely people are to notice it.
    2. The simpler the message, the less repetition necessary for a prospective customer to “get it.”
    3. Once a prospect has decided to purchase (or not), additional exposure to the message (during this purchase cycle) is pointless.

    What should our original young man do to sell more fluorescent numbers? Go door to door on your block again? Obviously he should choose another neighborhood and make his offer to new potential customers.

    And likewise, if you’re going to set up a Cruise Control system for customer acquisition, you won’t prompt additional sales by again offering the same people what you sell.* You’ll need to boost the number of people who receive your offer.

    How to do the Boost

    Don’t increase the number of ads in the same section of the newpaper you’re currently using. Put your new ads in a different section.

    Don’t run additional ads in the local TV six o’clock news. Run new ads in the 10 o’clock news. Run new ads on another TV station’s six o’clock news.

    1. Add a schedule on another radio station, or another TV station.
    2. Add another section of the newspaper. Or another paper.
    3. Post a billboard in a new neighborhood.
    4. Send postcards to a fresh list.
    5. Telemarket to a fresh list.
    6. Expand the radius around your business and distribute more door hangers or flyers or yard signs in neighborhoods you haven’t been “working.”
    7. Increase your pay per click budget.

    You may be tempted to pull ad dollars from the media outlets you’ve been using, but if you unhook the engine, how long can we expect that train to keep rolling? And substituting an unknown return from a new media outlet in the place of the known ROI of a tested outlet only increases risk.

    Systemic Marketing™ maximizes cash flow by eliminating speculation.

    Everyone Has Opinions

    Media people, printers, and your brother-in-law may feel qualified to opine about your marketing. Especially when you’re adding media to expose your message to additional prospects.

    Your new media representative will want to make a strong positive impression in hopes of keeping more of your business. The printer will assess your need for additional flyers, or direct response packages as an opportunity. They will offer to produce new and/or different ads. Don’t let them do that.

    By the time you’ve implemented a Marketing Cruise Control, your message will have been tested, refined, and polished. Everything from the offer to the choice of words to the colors, fonts, and images will be selected because they work better than those you tested them against.

    And testing always works better than opinions when you’re fishing for customers.

    Your Guide,
    Chuck McKay


    * OK. This is not completely true. But increasing the frequency of the message costs much more than it generates in additional sales for reason number three above. Most of the people exposed to your message will be those who’ve already decided whether or not to buy.


     

    Marketing consultant Chuck McKayYour Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

    Got questions boosting the number of people exposed to your message? Drop Chuck a note at ChuckMcKay@ChuckMcKayOnLine.com. Or call him at 304-208-7654.

     

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    Trends and Cycles and Advertising In Them

    Trend graph.

    Trend graph.

    Originally published August 12, 2008.

    Some trends are cyclical. Some are obvious. Sometimes both. Most are also predictable.

    Are all trends cyclical? Hardly.

    In the 90s, as growing demand and sophisticated technology converged to create the Internet, providing service to local subscribers was a great growth business. Look at the incredible growth of AOL, Compuserve, and hundreds of local ISPs throughout the country.

    Today, however, Internet service is a commodity. There’s no hope of a repeat of the dramatic growth curve of the last two decades.

    Trend, yes. No cycle.

    But the housing boom of the last few years? That was an obvious trend, with an equally obvious cyclical behavior. Equity growth can’t continue at double digit rates indefinitely. By the time cab drivers and school teachers are buying second homes as investment properties, the boom is about over.

    Trend? Definitely. Cycle? Equally definite.

    We’ve seen this cycle before, haven’t we?

    We’ve seen what happens after a real estate crash. We all remember 1992.

    In each phase of each cycle, some businesses will benefit, and others will be damaged. Real estate brokers and mortgage lenders did very well during the real estate boom. They won’t be doing well in the immediate future. Bankruptcy attorneys and payday loan companies will, however.

    While the housing bubble was rising, anyone hanging out a shingle got business. Advertising? That was a totally unnecessary expense.

    Now that the bubble has burst, how many brokers have left the industry? How many have laid off their staff, and are again operating out of their homes?

    Suppose you had been the one.

    The one real estate broker in town who had realized that markets don’t go up forever. Suppose that you’d started building your image as a problem solver, as the company who can get it done, back when times were good. Who would stressed sellers turn to today to help them get their overpriced homes off the market?

    The time to build image, to create Top-Of-Mind-Awareness, is before someone needs your services.

    When times are good, people may choose you because of your reputation. They may choose you as a result of your advertising. But, sometimes, you may simply be the beneficiary of so many people in the market that you’re tripping over them.

    That was a fair description of the recent real estate market in this country. It’s about to be the description of the state of personal finance, too.

    Trend? Yup. Cyclical? Obviously. Predictable? You tell me.

    And, much like real estate brokering, and mortgage lending in the early years of this decade, do you suspect a dramatic increase in the number of bankruptcy attorneys and payday loan companies?

    Yes. It’s a safe bet (but probably a poor metaphor, huh?)

    So, what’s ahead for bankruptcy attorneys and payday loan companies? A year or so of so much business they’ll trip over it. Followed by lean times when the “market correction” has played out.

    What’s my advice?

    Don’t depend on your Yellow Pages ads.

    Oh, they’re working well right now. By the time someone is in trouble and needs your services, they’ll open the directory and search for any headline that promises them relief from their particular pain. When people open the Yellow Pages they’ve already decided to buy. But since they have no familiarity with you, and no preference for anyone, it’s a crap shoot whom they’ll buy from.

    When the onslaught of people in financial trouble diminishes (as all trends do), you’re going to have to start competing with other bankruptcy attorneys or payday loan companies for the small amount of business that’s left. You’re going to need an image in people’s minds if you expect them to pick you. You can’t build image in a directory listing.

    Start now in other media.

    Give compelling reasons that people who need your services should choose you. Start now when cash is flowing and investments in your future are less painful. Start now, because it takes time to influence the way people think, and you’ll need that time when you’re fishing for customers.

    Your Guide,
    Chuck McKay

    Marketing consultant Chuck McKayYour Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

    Got questions about how economic trends affect advertising? Drop Chuck a note atChuckMcKay@ChuckMcKayOnLine.com. Or call him at 304-523-0163.

     

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    Danger in the Discount

    MP3 Player

    Generic MP3 Player

    Can you imagine a more idiotic challenge than to see which business can use up it’s investment capital and be forced out of business first?

    Its what happens each time a new business opens with no strategy other than to sell at a lower price.

    Dropping price doesn’t work. Long term, it never works. And in the short term it can’t create long term customers.

    Let’s create a hypothetical example:

    John finds a Chinese source for an 8mb off-brand MP3 player, which he can buy in quantity for $10 each. John checks eBay and finds the comparable offerings are priced at $40 each.

    Wow,” says John. “Those other sellers are being greedy. I’ll mark mine $30 each and sell a TON of ’em.” He estimates the cost of shipping, discovering it will cost roughly $6. John decides to charge $10 for shipping “and handling.”

    Thinking he will quickly sell all 100 units at $20 profit, plus a $4 shipping markup, he’s counting on taking in $2,400, and making a net profit of $1,400.

    John invests $1,000 dollars, purchases 100 players, and is now in business. He lists them on eBay for $30, plus $10 shipping and handling.

    John is right. There is a demand at that price point. He sells 16 the first day and 17 the second.

    On the third day John makes no sales. Worried, he browses eBay to figure out why.

    What’s this? This guy “Tom” has the same player listed at $27.  Worried, John drops his price to $25, and sells five more before, again, his sales abruptly stop. He finds Tom’s eBay store is still selling them at $27. Puzzled, he digs a bit deeper and discovers “Bob” now has ’em for only $22.

    John ponders. “Well, I’ve made some money on these. I think its time to get out of the MP3 player business.” He drops his price to $15, offers free shipping, and expects to blow out the remainder and retire.

    John sells 16 more before his sales again stop. He checks. Tom is reacting to the new competition by selling his players at $11 each.

    John cuts price below his cost, and offers his last 27 units at $8.50, plus free shipping. Another 19 are sold before “Andrew” offers the same player for $7.50, and free shipping.

    Tired of losing money, John contacts Tom, Bob, and Andrew, and offers his last 27 units to them for $270. None of them take him up on the offer.

    John cancels his eBay account, and determines everyone on his Christmas list will get an MP3 player for Christmas.

    Shall we calculate John’s profit on this venture?

    John's P&L

    Ouch!

    John could be considered a dabbler. A great many eBay sellers are.

    Some, on the other hand operate real businesses. Look at the feedback scores. Nobody gets to thousands of transactions as a dabbler.

    People like John are not the folks Dun & Bradstreet speak of when they report 6 out of 10 businesses with 20 employees or less don’t make it past their first year, and 9 out of 10 don’t make it to their 10th anniversary.

    Going Out of Business sign

    Going Out of Business

    D&B goes on to say that only 10 percent of all of the business failures in the US file for bankruptcy. The rest close voluntarily because operating their companies turn out to be way too much work for the meager income they provide.

    The biggest cause of insufficient income?

    Pricing too low.

    Why?  Because all of a new businesses operating costs are higher.

    A new businesses can’t BUY inventory at a lower price than the big box stores. It can’t ship at a lower price. And it doesn’t spend enough on advertising to buy in the bulk required to get reduced pricing there, either.

    Combine higher operating costs and lower profits with discounted pricing, and you have a situation my friend and colleague, Jeff Sexton, refers to as the “race to the bottom.”

    With lower price as your selling strategy, you’re competing with at least eight other ventures already in the process of going out of business.

    What’s the Solution?

    Raise your prices.

    C’mon, McKay,” I hear you asking.  “Just how do you suggest I raise prices in a bad economy when all of my competitors charge so little?

    Ah.  Fair question.  We’ll discuss that in a couple of days, as we continue fishing for customers.

    Your Guide,
    Chuck McKay

    Marketing consultant Chuck McKayYour Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

    Got questions about pricing for profit? Drop Chuck a note at ChuckMcKay@ChuckMcKayOnLine.com. Or call him at 304-523-0163.

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    Will Advertising Sell What People Don’t Want?

    Originally Published December 11, 2007

    While browsing the web, I came across an article titled, “Why is My Restaurant Not Full Every Monday Night?” (Google search if you’re all that curious. The article doesn’t answer the question, which is why I’m not linking it).

    But it does pose a valid question. Why isn’t your restaurant full on Mondays?

    Its a common desire in retail to advertise the things which aren’t selling, and let those which will sell easily sell themselves. This is frequently bad strategy. Very bad.

    It may well be part of the reason Wal-Mart thrived while K-Mart worked its way through bankruptcy. Of course, their respective advertising policies may only be a reflection of their inventory management. Then again, this all may be only a coincidence.

    And for the record, our story is completely fictitious.

    Assume that we have one Wal-Mart store and one K-Mart store, each stocked with various sizes of golf shirts in four colors: red, blue, green, and yellow. We’ll further assume that each store stocks ten in each color.

    For some reason, the yellow shirts are in hot demand.

    Each store sells out of yellow golf shirts.

    K-Mart, in the traditional Henry Ford fashion * notes that they still have 30 shirts in stock. No problem.

    Wal-Mart however, takes note that they are completely out of yellow golf shirts, and promptly puts ten more in inventory.

    Humm. People will buy what they want, when its available to them. The won’t necessarily buy what’s being advertised. So, while K-Mart is advertising golf shirts in various colors, Wal-Mart advertises that they have yellow golf shirts, and they have them in stock. (Again, this story is of my own invention. It has only a passing relationship to any reality).

    Can advertising sell them things they don’t want?

    The bitter experience of K-Mart would indicate that people will purchase only what appeals to them, rather than what’s being advertised.

    But our question wasn’t about golf shirts, was it? The question was “Why is My Restaurant Not Full Every Monday Night?”

    The reason is simple.

    Its not lack of advertising. (Rookie media salespeople will assure you that it is. They are wrong. It has nothing to do with advertising.)

    It is because people customarily don’t go out to dinner on Monday evening.

    They just don’t want to.

    They tend to go out to dinner on Friday nites, on Saturday, even on Sunday. By the time Monday rolls around, they’re feeling as if they should stop being so extravagant.

    On Mondays they plan to eat at home.

    Is there a Monday appeal?

    Is there a way to attract a relational customer to your restaurant on a Monday? Sadly, if Monday isn’t Valentine’s Day, Mother’s Day, or a spouse’s birthday, there is not. You could maybe get a transactional customer into your restaurant on a Monday if you offered a discount, but transactional customers tend to stay home on Mondays too.

    OK, make it a BIG discount. That will insure two things:

    1. bad turnout, and
    2. no profit from those rare few who do show up. 

    Humm. Advertising a restaurant is very much like duck hunting. You shoot when there are ducks to shoot at.

    So what can you do about those Monday nights in your restaurant?

    You can cut back on your staffing on Monday and hold your costs to a minimum. Then advertise your great Friday night specials, or your Saturday dinners, or even your Sunday brunch.

    Wait for them to be inclined to dine away from home, then remind them to pick you. Cater to what your customers want – and do so on their timetable, and you’ll start boosting attendance as you fish for customers.

    Your Guide,
    Chuck McKay

    Marketing consultant Chuck McKayYour Fishing for Customers guide, Chuck McKay, gets people to buy more of what you sell.

    Got questions about allocating and scheduling your advertising dollars? Drop Chuck a note at ChuckMcKay@ChuckMcKayOnLine.com. Or call him at 304-523-0163.


    * Henry Ford is rumored to have said about the available colors of his Model T automobile, “You can have any color you want, as long as that color is black.


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