Sunday, December 20, 2009

What Audience Segment are You Targeting?

I subscribe to a free service called Help A Reporter Out. Three times each weekday I get an email with requests from multiple sources needing quotes for articles, blogs and books.

One question recently peaked my interest. Below is the question, my answer, and some follow-up questions & answers.

Are retailers doing enough to attract new customer segments or are they putting all their eggs into one audience segment basket?

Most retailers are putting too many eggs into one basket, and usually it's the wrong basket. The biggest mistake most retailers make is in how they define their audience. Too often they use outdated and inaccurate tools such as demographics or average customers. Defining your customer based on age, gender, income and education doesn't work in today's world. Customers are too diverse to be summed up neatly in one little box.

Describe some common mistakes retailers make in their outreach efforts.

The two biggest mistakes most retailers make in their outreach efforts is:
  1. Going after the wrong model of people (see answer above)
  2. Not making the Outreach consistent with the Experience.
Too many times the marketing message is at odds with the in-store experience. A classic example of this a couple years ago was Wal-Mart trying to get into fashion. The marketing talked about upscale fashion, but the store screamed ugly, dirty and cheap. When they dropped that campaign and went back to advertising really low prices their numbers improved greatly.

There is a big disconnect between how customers perceive certain stores and how those stores advertise and market themselves. Thus, those advertising messages are seen immediately as false hype and are discounted or ignored. The best marketing & advertising campaigns are those that consistently match the actual experience in the store. If you advertise excellent customer service, you better have over-the-top customer service in the store. If you advertise low prices, they better be extremely low. If you advertise friendly, helpful staff, you can't have lots of fine print clauses in all your policies.

With new media tools added to existing traditional outlets like print, radio and direct marketing, how do they select the most effective tools?

All forms of advertising CAN work. The key is in knowing how each form works differently and then using them in the correct way. You can't do the same thing on Facebook that you do in a newspaper. They don't work the same. The key to selecting the right tool is to first identify the objective with clear and measurable goals. Then evaluate all the options to determine which tool most effectively can reach that goal. For instance, we use Facebook primarily as a way to fan the flames of our most loyal customers by making them feel like insiders. It is not used for reaching new people. I use radio for that purpose.

Can you offer 3-5 tips on improving their marketing messages?

First, identify the true Core Values of your business. What are the unwavering principles that guide every decision?

Second, evaluate every single aspect of the business to make sure it aligns perfectly with those core values. And I mean everything! From the message on your answering machine to the odor in your bathroom, you have to be consistent enough that any customer walking through the door knows exactly who you are and what is important to you.

Third, align your marketing message with your core values. If your store is about teaching the customer how to shop, use your marketing to teach. If your store is about whimsy and surprise, make your ads about whimsy and surprise. If your store is about efficiency and accuracy, make your ads about efficiency and accuracy.

When you follow those three steps you'll immediately start attracting new customers to your store, customers who align their values with your values. That is the most important segment of the audience to own.

Merry Christmas!

-Phil

Sunday, December 6, 2009

Doing December Differently

(Note: I know it's already December 6th. For some of you it might seem like too little too late. But the advice is good and I didn't want to wait 11 months before sharing it.)

Today's sermon from Pastor Dr. James Hegedus at the First Presbyterian Church of Jackson was about "Doing December Differently." Would it surprise you to learn that pastors take the same approach to December as retailers?

As Pastor Jim put it, "I turned the page on the calendar and sucked all the oxygen out of the room."

Yes, big, deep sighs as we brace ourselves for the onslaught of the busy season.

Pastor Jim went on to talk about how he is preparing his way for the Lord differently this year. As retailers we need to think about how we prepare, too. Here are three things I encourage you to do differently this December.
  1. Schedule some white space
  2. Empower your staff
  3. Focus on one customer at a time
The hardest thing we face in December is the way everything seems to grow and speed up exponentially. The fires to put out, the to-do lists, and the pace of business whirl around faster and faster until we are sucked into the stress and craziness of the season. Soon we aren't eating or sleeping well, we're losing our patience faster and we become a different person than we were the other 11 months of the year. I know. Been there, done that.

But it doesn't have to be that way. You don't have to take a deep sigh as though holding your breath while you plunge into the icy waters of December. You just have to do things a little differently.

Do these three things and it will make a huge difference in how well you feel (and how well you do) at the end of December.

Schedule some white space. Just as the white space in a newsprint ad makes the message stand out more powerfully, white space in your life makes you more powerful. Schedule at least 30 minutes per day for quiet time. Use it to read, write or reflect, but don't use it for anything relating to your business. It will recharge your batteries and give you a fresh outlook on your life and your business.

Empower your people. Teach your employees how to do what you do and let them do it. Reward and praise them when they do it right. If they do it wrong, first support them, then show them how to do it right. Soon they will be doing more so that you can do less. Will they do it as well as you? Probably not at first. But if you're rewarding their behavior, they'll do it well enough to make a difference. And you'll immediately have more time on your plate.

Focus on one customer at a time. As the boss it is hard not to look and listen to everything happening around you. But the more you can learn to focus on one customer at a time, the more the world slows down for you and the bigger impact you can have on that one customer. Give her your full attention and win her over as a fan. She deserves nothing but your best. And don't worry about those waiting customers. When they see you giving your all to one customer, they'll want some of that kind of service, too.

Do things a little differently this December. Give yourself a break. Empower your staff. And take it one customer at a time. You'll see the results before the champagne pops New Year's Eve.

Merry Christmas!

-Phil

Monday, November 30, 2009

What Chris Brogan Can Teach You About Retail

Chris Brogan, author and power blogger, just posted a blog about a horrible shopping experience titled What Timberland Taught Me About Retail.

There are many lessons in there for independent retailers. I'm going to talk about two of them.

The gist of the story - he saw a Timberland boot advertised on TV and went to a few brick & mortar stores to find it, make his purchase and move on. Unfortunately, the stores were ill-prepared for his visit. Some didn't even know about the product. Others knew the product but didn't have it. Others had it but not in the color or size he needed. Overall, he was frustrated that he could not find anyone with credible information - let alone the actual item - about a product he saw advertised on TV by a major vendor.

This happens all the time in retail. Customer sees product in advertisement, customer wants product, customer goes to store, store doesn't know product, customer goes away frustrated.

But it doesn't have to happen in your store as long as you are proactive about the situation. To do that you have to know the answer to two questions.

The first question is whether or not the company ever gave such information to all the retailers or whether this was an exclusive channel distribution product.

The best retailers know not only the products they sell, but also the products they don't sell (and why). Do you have major vendors that also sell exclusives to big-box stores and Internet sellers? Have you asked them for info on the exclusives you can't get?

If you want to be the product knowledge king, that is information you need. And don't wait for your reps to give it to you. Ask them right up front to get that info. Start with your top vendors and work down until at least you have a working list of products customers might request that you don't have. (And know why you don't have it - by your choice or the vendor's choice.)

If you choose not to carry an item available to you, there is a reason you didn't buy it. Does your staff know that reason?

Just imagine the different type of experience Chris would have had if an associate said, "I know the boot you saw. We chose not to carry it because we like model x better. It has... which means you'll..."

Or if you couldn't get the product... "I know the boot you saw. We don't have that style, it is only available online, but let me show you this one. It is similar because..."

Can you see the difference between either of those scenarios and, "Nope, never heard of 'em,"?

The second question is whether or not the sales staff even cared about knowing that information.

Maybe the information did come down the pike. What did you do with that info? What did your staff do?

This is a training issue.

The best retailers are motivating their staff to know more about the products than the customers. In this day of endless information on the web, it is vital that your staff are constantly researching product info. Yes, the customers are already coming in armed with more info than ever before. But now it is your job to sort that info for them and give it relevance. Tell them why a certain feature is included and what it will do for them (benefits). Let them know why one item costs more than another and help them figure out if the extra expense is worth it.

How much product knowledge training have you offered to your staff? How much time do you spend on teaching the benefits of every product you sell? How much time is devoted to continually updating that info? If you're not doing this, you're letting customers like Chris get away.

Chris Brogan just told a few hundred thousand people not to go shopping in brick & mortars because they were basically clueless. The only way we can combat messages like that is to constantly give our customers the kind of service that would have made Chris a loyal follower.

Can you do that in your business?

-Phil

Wednesday, November 25, 2009

Don't Make Your Customers Mad

Why would I want to make my customers mad? Apparently some retailers think it's okay to piss off a few people.

This Thursday the fliers hit the door with all the early bird doorbuster specials for Black Friday, and some of them are going to make customers mad.

Look at the fine print in these ads and you'll see what I mean.

Some of the best deals say "minimum 2 per store" meaning that stores in smaller communities (like Jackson) may only have 2 of those great items they're using to draw a big crowd. If you're standing in that line at 5am you gotta ask yourself... Will you be one of the lucky two? Or will you be one of the mad?

Some of those deals aren't deals at all. Read the model numbers and compare them to what the stores currently sell. Some of those doorbusters are what we call derivatives or one-offs. They look the same as the original, but some features have been stripped out to make it cheaper. Will you be one of the shoppers who did the research and is happy with what you gave up? Or will you be one of the mad?

Some of you will give up sleep, fight crowds, and wait in long lines. Some of you will find that fun. Some of you will be mad. (If you ever wondered why some people love Black Friday and others hate it, click here.)

And think about the staff. They had to give up spending time with their families. They got too little sleep. They're overworked (and underpaid). They're on the front lines having to deal with all these unhappy customers. Some of them aren't all that happy now either.

I've never quite figured out why these stores go through all this hassle knowing the outcome is that they will anger as many customers as they please, and not make many friends with their staff, either.

If you're offering any Black Friday specials, do your customers, your store, and your staff a favor.
  • Make sure you have ample supply of anything you advertise.
  • Be honest about the deal. If it's a derivative or one-off, let people know up front.
  • Train your staff to learn how to show empathy with unhappy customers and empower them with tools to solve problems and make the customers happy.
This Black Friday most every major retail chain will make a whole bunch of their customers mad by design.

You don't have to play that game, too.

Happy Thanksgiving!

-Phil

Monday, November 23, 2009

Currencies That Buy Credibility

I'm reading a brand new book on marketing. Well... okay, I just read a brand new book. I read it in one sitting. And I'm planning to read it again - probably tonight.

Yeah, it was that good.

The book is called "Currencies That Buy Credibility" by Tom Wanek.

Too many times we hear lines in marketing & advertising that just don't ring true. Things like...

"We won't be undersold!"
"The best sales staff in town!"
"The world's largest selection!"
"Lowest prices guaranteed!"

Maybe some of them are true, maybe they aren't. The key is that without something to show us how they are true, our cynical nature leads us to disbelief every single time.

Tom, however, teaches you how to give credibility to your statements, whatever they may be, through six different currencies such as your time, your money, or your control. With credibility you grow trust. And with trust you grow your business.

The book is easy to read, has great examples, and makes perfect sense. You'll be applying his principles almost immediately. I know, because I have. I started reviewing and rewriting my radio ads this morning based on what I've learned.

If you're involved in the marketing of your store, this is one book you should add to your library.

(Full Disclosure: Tom is a Wizard of Ads partner I met 2 years ago. As an acquaintance, I planned to read his book from the moment he announced it being published. But I wouldn't be promoting it here unless I believe it can help you. And, no, I'm not getting anything for promoting his book - except maybe a heartfelt thanks.)

-Phil

Tuesday, November 17, 2009

The Three People to Solve the Problem

If you're in retail, at some point you will have a customer with a problem. And your success will depend on how well you solve that problem in the customer's eye.

The key is knowing the three people who can solve the problem. Those people are (in no particular order):
  • The person Most Capable of solving the problem
  • The person Closest to the problem
  • The person Least Busy at the time of the problem
The problem for most businesses is the order in which we prioritize that list. From a business owner's standpoint the ideal priority would be:
  1. Most Capable
  2. Least Busy
  3. Closest
From a customer's point of view, however, the order would be:
  1. Closest
  2. Least Busy
Notice that I left off "Most Capable". The customer expects that everyone will be Most Capable. And that's where the smart retailers succeed. They equip their front line staff with the tools to solve problems so that customers get satisfaction right from the start.

There is nothing more frustrating to a customer who already walked through the door loaded for bear than having to wait around while incompetent fools run off in search of an already over-worked manager to approve a return or refund or some other simple issue.

Conversely, there is nothing so satisfying as a customer than having the first person who greets you being able to fully take care of your problem.

The best thing you can do for your staff is walk them through the basic problems that arise in your business. Show them your thought process and the criteria you use to make decisions. Then empower them to make those same decisions for the customers.

Sure, they might make a mistake or two. Sit down with them when they do and talk through their decision-making to see their process. Use that time to show them (again) how you would handle it. The good ones on your staff will get it quickly. Plus, they'll feel more ownership for the satisfaction of the customers in the first place.

There will still be a time when the person closest to the situation can't solve the problem. But the more often they can, the better your customers will feel about you and your business.

And isn't that the whole point?

-Phil

Wednesday, November 11, 2009

The Christmas Tree Lesson

My son gave me the coolest gift for my birthday - a Charlie Brown Christmas Tree.
Now some of you might wonder why I think that is so cool. I mean, it's a lonely, bare tree that represents the ultimate failure of a blockhead child. Charlie was laughed out of the auditorium when he presented it to the Peanuts Gang.
Yet, there are lessons in that tree that all independent retailers can learn.
Think about what happened next to Charlie's tree. (I know you've all seen the Charlie Brown Christmas Special at least a dozen times - this should be a simple exercise.)
Linus wrapped his blanket around it to give it support.
What have you wrapped around the foundation of your business to give it support?
Have you secured your financing? Have you bolstered your training program to make sure your staff is fully trained and ready to deliver excellent customer service? Have you checked to make sure your inventory includes an ample supply of the "must have" items - the stuff you can never be out-of-stock?
These are the foundations that give your business support, no matter how simple or bare your business might be.
Back to the tree... After Charlie Brown left, the other kids gathered around and decorated the tree with stuff from Snoopy's dog house. The finished product looked as good as any tree ever did. But it wasn't the decorations that made the tree special, it was the love they poured into it.
You don't need the budget of Nordstrom's to dress up your store to look its best.
You only need to add in some Love. Pour some love into your business. Show your customers how much you love what you do, and you'll look more special than any overspent, over designed, cold, heartless big box store. Show passion in your design, passion in your policies that serve, and passion in your interactions with the customers and you'll be the best tree on the block.
Even a simple tree like Charlie Brown's can become something special. So, too, can your business.
Merry Christmas (and Happy Birthday to me:-)
-Phil

Wednesday, November 4, 2009

What Are You Tracking?

You can't manage what you don't measure. Here are two numbers you should be measuring this holiday season.

Traffic Count: How many sales do you have per day (Monday, Tuesday, Wednesday...)? Per day part (morning, afternoon, evening)?

Knowing this can help you schedule your staff to better meet the peaks and valleys of your daily & weekly sales. It also helps you measure the success of your marketing and your customer service. If traffic counts are up, you're doing something right. If they are down, you better figure out why (and it isn't just the economy).

Average Ticket: How much is the average transaction or sale? Which employees have higher or lower averages (if applicable)?

This number helps you measure the effectiveness of your sales staff and promotions. It also helps you understand your merchandise better. Are you getting the add-on sales? If not it could be that you don't have the right products to complete a customer's purchase. If you sell dolls, you better sell doll stands. If you sell electronics, you better sell batteries.

Measure these two numbers. They have a lot to say about your success.

-Phil

Monday, November 2, 2009

Yes They are Price Shopping With Their Phone - It's Okay

The new applications on iPhones allow your customers to scan a bar code on a product on your shelf and get all kinds of information online including the price others are charging for the very same item.

Oh no! Oh, yes. Customers can more easily price shop you than ever before. What are you going to do?

Some stores are banning customers who do this. Don't be one of them.

Allow your customers to use this new app. Embrace the technology. As Bob Phibbs pointed out so well, use it as a means of connection with your customer. Ask them what they found. See if the info is accurate. Chances are, you'll be able to add info to what they find, or at the very least be able to make that info relevant by explaining to the customer what it means.

By all means, however, treat these customers with ultimate kindness and respect.

Sure, many of them are price shoppers, transactional customers, who won't ever be loyal or profitable for your business. But that is no excuse not to kill 'em with kindness.

One thing we know about transactional customers is that they are always big on word of mouth. They love to talk about their shopping experiences.

And when they leave your store, they could be saying, "Wow, what a bunch of overpriced jerks!"

Wouldn't you rather they said, "What a friendly knowledgeable store - expensive - but they really know their stuff,"?

Embrace the new iPhone apps and other programs that allow customers to price shop and get other info on your products. And then recognize that they came to you first. Now give them a reason to buy.

-Phil

Friday, October 30, 2009

More Than One Way to Say It

I wrote two articles for a local organization's newsletter about Shopping Local. The first was soundly rejected. The second was roundly praised. Funny thing is, both said pretty much the same thing. The difference is that one said it powerfully, one not as strong.

Yes, it was the more powerful message that was rejected. The fear was that it would be seen as offensive to some. Of course, that was my point. No, not to offend, but to attract.

A message is like a magnet. It's power to attract is equal to it's power to repel. The stronger the attraction, the stronger the repulsion.

If you are writing to attract, write powerfully and pull no punches. If you are writing not to offend, don't be upset if your message doesn't get through as strong as you would like. Those are the trade-offs in making a memorable message.

I understand the reasoning behind the newsletter's owners wanting not to offend (otherwise I wouldn't have written the second article). Some of my original points were directed right at some of their membership which wouldn't have gone over well. And that's a fair reason for the rejection.

But there's a lesson here worth remembering. The most powerful messages will offend as many people as they attract. And that's okay.

Here are the two articles. You tell me which one was more powerful...


What Does it Mean to Shop Local?

There are differing opinions as to how we define a Local Business. Here is the definition that counts…

A local business is one that is owned and operated by someone actively involved in this community.

If in doubt, ask yourself, “Where does the profit go?” Locally owned businesses invest their profits back into Jackson. Chain stores send their profits back to headquarters (usually to pay for some CEO’s golden parachute). Online stores never let the money spend a moment in town.

Studies continually show that locally owned independents and locally owned franchises give back far more to the community than big box chain stores and online sites. They employ more people per sale, pay them a higher wage, pay more in taxes and give more in charity than the chain stores*. They also do more business with other locals keeping the money flowing through Jackson many times over.

A study in Grand Rapids showed that just a 10% shift in shopping habits from big chains to locals would create hundreds of jobs and millions of dollars in economic activity, not by spending more, just by spending it locally.

Your local businesses sponsor local events. They sponsor your son’s Little League teams. They supply most of our local leaders. They don’t run at the first sign of trouble. They are rooted in our community.

Christmas is a time for giving. As you plan your giving, think about the businesses who have given back to Jackson, who have invested their livelihood in Jackson.

You can find a bunch of them at http://www.jxnlocalfirst.com/.

Merry Christmas!

Phil Wrzesinski

*Studies cited at www.jxnlocalfirst.com


Keep Your Dollars in Jackson

They say it takes a whole village to raise a child. It also takes a whole village to raise an economy. But first you have to invest in the village. You have to put your money where your house is. Spend your money in Jackson.

The holidays are a time for increased spending. They are also a time for increased everything else, increased traffic, increased stress, and increased demands on our time.

For some, that’s a compelling reason for shopping online. Sure, you might save a buck or two, but the money you saved was money that left Jackson with no benefit to the local economy. And if you didn’t pay sales tax, that’s a loss of revenue for our schools.

When you shop local - when you stay in Jackson to make your holiday purchases - you are investing in your neighbors. You are employing people in your community. You are adding to the available dollars for charity. You are growing Jackson’s tax base and economy.

Washington, D.C. does not have a silver bullet to kill the recessionary beast. Lansing cannot fix what ails us.

But you can.

Spend your money in Jackson and it will make a difference – a big difference. A study in Grand Rapids showed that just a 10% shift in shopping local would create hundreds of jobs and millions of dollars in economic activity, not by spending more, just by spending it locally.

Keep your dollars in Jackson this holiday and you’ll be giving a whole lot more than just presents.

Merry Christmas!

Phil Wrzesinski


See the difference?

Cheers!
-Phil

Saturday, October 24, 2009

A New Twist on Training New Employees

I just hired seven new employees for the store. Now comes the fun part - training.

My standards are high. My customers' standards are even higher. They have an expectation about our store that may seem unfair in these days of self-serve retail. They expect to be waited upon. They expect to have their questions answered quickly, correctly and with good cheer. They expect the staff to be friendly, knowledgeable and efficient. They expect us to have what they want, get it through the checkout quick, giftwrap it for free and have them on their way before their child has time to even think about a meltdown.

Oh yeah, and they want to have FUN while doing it.

In short, my customers are expecting the world, and I am planning on giving it.

The seven new employees had two things in common - a desire to help others and a strong work ethic. Those were the characteristics I required in this round of hiring. Now comes the task of teaching them about the toys, about our services, about our policies, about our cash registers, about our philosophy. There is a lot to learn. More than I can remember. More than I have time to teach.

I did two things you can copy for your business when you have to hire & train new employees.

First, I created a checklist of all the skills the new employees need to learn. I broke it down into main items and subcategories to make sure nothing was overlooked. Simple things like closing procedures or bagging toys were on the list along with educational material like How Toys Teach, and Phil's Top Ten Toys. Cash register procedures, time clock procedures, delivery policies and every other service we offer is on the list.

And next to each item on the list is a blank line.

The second thing I did was empower my current staff to train the newbies on all of these procedures. The only caveat is that the employee who does the training has to put her initials on the newbie's checklist next to that item.

There are three immediate benefits of doing training this way.

  1. The regular staff gets a sense of responsibility in training the new hires. They feel more empowered which leads to even more responsibility.
  2. Everyone is accountable for how well the training is accomplished. If your initials are on the checklist, you better have taught them well. Knowing that you'll be evaluated, too, has the regulars honing their own skills in the process.
  3. We're building camaraderie right from the start. The new staff are interacting more with the old staff and getting to know them quicker than if they were just working along side each other.
Sure, I'm still involved in the training. Some of my involvement is direct teaching the skills I want to teach, but most is just overseeing the process and evaluating the new employees' skills as they learn. Best of all, I get to see who of the regulars has the ability to teach and who needs more work on their own skills.

All in all, through this process everyone is improving their abilities to give the customers the kind of service they expect. And I'm getting seven new smiling faces ready for the frontlines this holiday season.

-Phil

Friday, October 9, 2009

Google AdWords - Good or Bad for Advertisers?

John Kelley from Google Ann Arbor was in Jackson yesterday telling a room of 150 people about how Google makes its billions of dollars a year. Almost all of it comes from their advertising auction known as Google AdWords.

If you're not familiar with how it works, here's a quick breakdown.

You set up an account with Google, choose some keywords or phrases, and then make a bid of how much you are willing to pay to show up in the right hand column when someone uses the Google search engine with your chosen keyword.

The cool thing is, just showing up on the right doesn't cost you a penny. You only pay when someone actually clicks on the link. And you only pay whatever you were willing to bid.

For instance, you might choose the keyword "toys" and bid a maximum of $7. When someone types "toys" into a Google search, eight links show up in the right hand column on the first page. Those eight are in order by how much they were willing to bid. If two other people bid higher, you'll be third on that list. If no one bid higher, you'll be at the top, and at a rate only slightly more than the next highest bidder.

Again, you only pay if someone actually clicks on your link.

The beauty of this system is that you only pay for the ads that work, that get people to your website. And you only pay what the market will bear. It is supply and demand at it's greatest. A truly capitalist product that allows small mom & pop shops to compete with large national corporations.

And since it regularly brings in billions of dollars it must work well, right?

Maybe, maybe not. Like all advertising, it comes down to how you use it.

Yes, it is one of the most measurable forms of advertising. You know how much you paid to get traffic and how much revenue that traffic generated. Yes, it is relatively easy to get started and easily tweaked to make it work better.

No, it doesn't work for everyone. In fact, there are two groups for which Adwords would be a lousy investment.
  • Businesses who don't have a website (if you don't have a website, you should read this.)
  • Businesses who don't generate revenue directly from their website.
If you fall into either of these categories, Adwords won't help you grow one bit.

Think about it this way...

The person searching online for a retail product willing to click on a right hand sponsored link is looking for an immediate solution. They are typically looking to make a purchase right away. If you don't sell online, they're hitting that back button as quickly as they can.

You won the auction, but lost the sale (and the ad money).

If you're going to do Google Adwords, here are some suggestions:
  • Do reverse searches to see what keywords are most being used in your category.
  • Only sign up for keywords that relate directly to the products you sell online. Otherwise you're getting a lot of the wrong traffic
  • Write many different phrases for your posts (you get 94 characters for your description) and constantly measure and tweak to see which ones get clicked most often.
  • Measure, measure, measure. Change where people land on your website, see how long they stay, if they buy and where they exit. You will learn quickly where your website breaks down in the sales process.
As you measure your Return On Investment you'll get a clearer picture of whether or not this program is working for you. Unlike traditional advertising where your only measurement is if business is going up or down overall, at least with Adwords you'll know what works and what doesn't. The old advertising joke is that half of your ads work and half don't, you just don't know which half. With Adwords you'll know (for better or for worse).

If your retail business is strictly brick & mortar - no online presence - Adwords isn't for you. If you are using your advertising to brand your store, Adwords isn't for you. If you aren't up for constantly measuring and tweaking your results, Adwords isn't for you. But if selling online is your primary goal, it could work - and work well. Billions of dollars can't all be wrong.

Do you agree or disagree?

-Phil

Wednesday, October 7, 2009

What Apple Have You Eaten Today?

This post is totally off topic, intended only for those who want a little brain exercise and reflection time.

Last night I watched the movie Phenomenon with John Travolta & Kyra Sedgwick. There was a particular scene that stuck with me.

John Travolta's character George Malley is dying from a brain tumor. He has just befriended Kyra Sedgwick's character & her two children. The kids, however, are upset at becoming his friend only to find out he's about to die. George has a fascinating way of handling this topic with the kids.

He takes an apple and explains that if the apple was just thrown on the ground, it would rot away and be gone forever. But if you were to take a bite of the apple, that bite becomes a part of you forever.

In a touching moment in the movie, the kids both end up taking huge bites of the apple.

The scene got me thinking... What bites of *apple* have I taken that are still with me?

The first thought that came to my mind was my homeroom teacher & swim coach from high school who had two phrases he repeated often. The first was, "Can't never did nothing!" To this day, if you say to me, "I can't," I'll respond instinctively and immediately with that quote. His second quote was, "Luck is when preparation meets opportunity. The harder you practice the luckier you get."

Both of those quotes must be in the forefront of my unconscious mind because of how fast they jump into the conscious when the opportunity presents itself. And every time I say them, I picture Coach Pultz standing next to me.

That is just one of many apples I've eaten in life. Other apples include every camp counselor who put up with my shenanigans as a kid, every speaker who inspired me to try something new, every writer who wrote something I wanted to remember.

I'm curious to hear about your apples. What apples have you eaten in your life that are a part of you forever? And have you eaten any apples today? Also, what apples are you offering for others? How far does your orchard spread?

You might be surprised when you stop to think about how wide an influence you already have in this world because of those who have eaten your apples.

Sure gives a new meaning to the phrases, "An apple a day keeps the doctor away," and "You're the apple of my eye," doesn't it?

-Phil

Friday, October 2, 2009

Breaking Trust the AT&T Way

Two letters have undone all trust I ever had with AT&T. For 60 years we have used AT&T in one form or another for our store. That's a lot of trust built up.

The first letter came on August 24th saying that my account with them was about to expire. With 16 phones, 8 business lines, and a business open 7 days a week, you can believe I called them right away. After jumping through a bunch of online menu hoops I got a guy who informed me that my account was not about to expire, but that he had some great offers of other products I might want to buy.

Yeah, the letter was a total scam to get me to call so they might sell me some services I didn't want. Apparently the hundred plus phone calls from sales reps that I had blown off wasn't enough for them to get the message that I was completely happy with my current level of service and didn't want anything more.

Trust meter down 50%.

The second letter came today. It informed me of the "new services you have requested" and that my new bill would be $106.35 more for the new services.

What!!?

Apparently, even after explaining that I was happy with my current services and didn't want anything more, AT&T thought I should have Caller ID for my 8 lines (two which are purely modems, not even used for receiving calls). And somewhere over the past month, they decided to add that to my account for an extra $106.35 a month.

Yeah, I got back on the phone. Only this time it took 5 calls and umpteen hoops before I found a live person. Unfortunately, the phone number led me to a live person that had no clue how to help me with my problem. Yes, she finally transferred me to someone knowledgeable on the subject, but even then, he couldn't help me. (What's the point of giving out a phone number if the people answering that phone can't deal with the issues for which the number was given?)

Bottom line? They changed my account because they changed program I was on. It wasn't anything I had actually requested. I just wanted to stay on the old plan, but the old plan now had Caller ID bundled in it and I was getting Caller ID even though I don't need it, don't want it, can't use it. No option. It was now in the plan, and I had to pay for it.

I suppose AT&T's idea was, if you can't get someone to buy your products, just bundle them in and tell them they have no choice but to pay for them.

Trust meter down 100%.

On Monday I'll be calling their competitors.

There are so many lessons in this, I don't think one post could cover them all. Here's the one I want you to remember...

Trust takes time to build, but only seconds to shatter. We have used AT&T in our business for over 60 years. We have never had any issues with our phone service. Yet it all was destroyed in 39 days, and now I'm shopping around.

Trust is precious. The trust you have built with your customers is gold. Remember how hard it was to get that trust, and then do everything in your power to keep that trust. Make sure all your policies, procedures and ventures are designed to build trust, not break it.

-Phil

PS If you sell phone services, call me Monday.

Wednesday, September 30, 2009

Being a Successful Retailer

If you've been following this blog regularly, you probably know everything I'm going to say here. Some of it is in my Bio, and some is on my new website www.PhilsForum.com.

For those who are just starting to follow, I'd like to give you a little background about who I am and what I want to accomplish with this blog.

I am a retailer. I run a toy store so I know a lot about seasonal business. I also sell baby products so I know a lot about working on deadlines (nine months might seem like a long time, but it sneaks up on a lot of couples).

And most people consider my business to be quite successful. We were named by George Whalin as one of the 25 Best Independent Stores in America. So we must be doing something right.

In a couple weeks I'm going to tell the city of Jackson how to be successful in a market with 15% unemployment, a shrinking blue-collar workforce, and a struggling government & economy.

I can sum it up in two words - Keep Learning.

When I realized that our advertising wasn't working, I took classes, read books and studied until I fully understood branding and how ads work. I give a lot of credit to Roy H. Williams, aka The Wizard of Ads for what I learned.

When I realized that I was lousy at hiring, I evaluated the problem until I understood where I went wrong and developed a system to improve the quality of people I was bringing in. (I'm publishing a book about it later this fall.)

When I took over 50% of the buying responsibilities for the largest selection of toys under one roof, I studied open-to-buy systems and adapted them to fit our situation and needs.

As an Independent Retailer, there are always fires to put out, always challenges to face, always new obstacles to overcome. I believe the successful businesses are the ones who are always learning, always expanding their knowledge & understanding of four key areas:
  • Customer Service
  • Inventory Control/Merchandising
  • Financials
  • Advertising/Marketing
I have found that the more I study, the more prepared I am to meet the new challenges and turn them into opportunities. As my high school swim coach used to always say, Luck is when Preparation meets Opportunity.

How do I do it? I devour business books. I am reading Trust Agents by Chris Brogan & Julien Smith right now. It will be the 12th non-fiction book I've read this year. One of my favorite books was Seth Godin's Tribes. It's no wonder that I follow both Seth's and Chris's blogs.

Which brings me to the goal of this blog... I want to share with you what I've been learning so that we all can be successful.

Your feedback is welcome. The more you comment and tell me what's on your mind, the more I can tweak this to give you what you need. If there are topics you'd like to see addressed, let me know. If there ideas you want to share, by all means share them.

We're in this together. At least that's my way of thinking.

Your thoughts?

-Phil

Wednesday, September 23, 2009

Social Media - A Must Have or A Passing Fad?

Facebook, Twitter, LinkedIn, MySpace. You've heard the names. Some of you even have accounts - personal and business. And everywhere you turn, another talking head tells you how these new Social Media platforms are going to change advertising as we know it. Yet the critic in the back of your head wonders if it's really true when they say Social Media is going to make all other forms of advertising obsolete.

There certainly are some advantages to using social media platforms like Twitter and Facebook. First, they're FREE. That has to count for something. You can set up a Facebook page for your company with almost all of the same information as your website at no charge to you. You can send messages to all of your fans without the cost of an email service. You can change pictures, announce events, and have chats with your customers without contacting the IT department.

And it's all Free!

Well, not exactly...

In life, no matter what you want, you have to spend one of two currencies - time or money.

While Facebook may give you all of the above services at no monetary charge, there is a huge time commitment necessary. You have to create all the content yourself. You have to build relationships one friend at a time. You have to monitor discussions regularly. It can take months or even years to develop a friends list with enough people to move the needle.

The same is true of Twitter. Setting up an account is easy. Getting a bunch of followers is harder. Saying something worthwhile in limited space enough times to be relevant is even harder.

But both can be effective tools in your advertising tool box - especially if you have more time than money. Twitter can be an effective way for stores with a fast-turning product to keep customers informed of what is in stock. Facebook can be a great way to give an active fan base a platform for gushing nostalgic about you.

If you're going to jump into the social media pool, here are some things to think about:
  • Decide your purpose for doing social media. Is it to generate leads, keep people informed, set a platform for customer involvement, or some other purpose? Clearly define your goals and it will help you determine your path.
  • Be transparent. No, you don't have to tell people what you had for breakfast, but if it has your name on it, it better be you writing it (or at least editing it). Don't just dump it off to the "young kid on the staff," and hope he stays consistent with your brand. Be honest, forthright and genuine. Don't try to be something you are not, just be yourself openly.
  • Stay up to date. Update it regularly - at least weekly, preferably more often. If you can't commit to that kind of regularity, don't do it. A stale account can be more damaging than no account at all. (Yeah, I know, my Facebook account needs some more love.)
Knowing how the different social media work is important, too. The three most talked about - Facebook, Twitter and LinkedIN all work somewhat differently.

Twitter is about inside information - no, not the kind of stuff for which the SEC sends Martha Stewart to jail, but information that lets your followers feel like they know more than the average Joe because they follow you. Your tweets need to have the kind of information they can't just get from your website or off the street. Let people into the workings of your mind by telling people why you're carrying a certain brand (or not carrying one). Show them how you decided on a certain product or service. Tell them about issues affecting your business that may affect them. Be the first place to announce new arrivals. Make your Twitter followers feel like an insider and you create a connection with them that raises loyalty to a whole new level.

Facebook is about making and keeping connections. Facebook is all about the customers and their interactions with you. It is the media of nostalgia - posting pictures and videos, sharing memories. Your Facebook page has to encourage this behavior. Start discussions, post pictures and videos. Keep up a dialogue with your fans. Yeah, you can announce events, but if that is all you do, your fan base will get bored quickly. It isn't about you. It's about them.

LinkedIn is often seen as a more professional site. I liken it to speed networking. Meet and greet people. Find people who think or act like you do and make connections. If you are a service provider or independent consultant, LinkedIn could be a valuable way for you to expand your circle of influence. But like all the social media, you have to be active. Just setting up an account and waiting for people to connect to you won't help. You have to join some groups, post comments, offer assistance, write recommendations, and actively seek out connections. The more active you are, the more connections you'll make.

As you can see, social media is a simple equation - time for money. If you have time, you can make social media work for you. If you have the discipline to stay current and active, you can make social media work for you.

And if you don't have the money to do traditional advertising, you better find the time to make social media work for you.

Do you agree or disagree?

-Phil

Tuesday, September 15, 2009

Billboards - Drive By Advertising or Wasted Space?

Coming into Las Vegas, you don't need a show guide to see who's playing. One trip from the airport and all the major acts in town are displayed larger than life. Penn & Teller, The Jersey Boys, David Copperfield, are all standing tall above the road. The promoters in Las Vegas must believe that billboards are an effective form of advertising. And they'd be right.

To some extent.

Billboards certainly have the power to be effective tools in your advertising repertoire. They have two inherent advantages over other media.
  1. They reach lots of people fairly inexpensively.
  2. They reach lots of people with regular, heavy frequency
We are creatures of habit. We travel down the same roads on the same route to work, to school, or to home. We see the same billboards once, twice, maybe as much as 6 or 8 times a day. That is a lot of impressions. Some say billboards are the most cost-effective method of reaching a mass audience with enough frequency to be remembered (remember our discussion about frequency in radio?).

But not all billboards ARE remembered. Like other passive media, there are important steps to creating a successful media campaign.

First, you have to understand the limitations of billboards. A person has, at best, about 3-4 seconds to read your billboard - only enough time for 1 picture and 8 words (including your logo). That is not much room or time to say much of anything. On those Vegas Act billboards there is a picture of the performers, the name of the performance, and the hotel where it is performed. Nothing more, nothing less.

Yet, too many ineffective billboards try to cram too much text, too many or too complicated pictures, and then add in the company logo, address, phone, website and directions. It will take you three or four passes just to read it all. Yet, you'll be bored enough to ignore it after the first drive by.

Frequency, while good because it reinforces your message, can also work against you. After seeing a billboard a few times, if the picture has no meaning and stays unchanged over time, it starts to blend into the background.

And frequency is not always the most important element. Those Vegas boards are seen only once, yet they work. Why? Because the message already has an emotional content for the reader. When you see Penn & Teller, you already have a feeling attached, either from experience, or other forms of advertising. The feeling may be one of excitement or one of disinterest. But the feeling is there nonetheless.

Therefore, the emotions that your billboard evoke are every bit as important to it's success as the number of people who see it and the frequency by which they see it.

To do billboard advertising effectively, follow these tips:
  • Limit your board to 1 picture and 8 words including your store name & website. Anything more and the board has too much information. Simplicity is best.
  • Print the design of your board on an 8.5x11 paper and tape it to the wall across the room. All designs look good on a computer screen. The key is if it looks good from a distance.
  • Use a picture that elicits an emotion tied to your store. Without an emotional tie, the billboard is just clutter on the mental freeway.
  • Change your boards frequently. After about 3-4 weeks, unchanged billboards become invisible.
Billboards CAN be effective when done right, reaching a ton of people at a fraction of the cost of newspaper or TV. But you have to be able to make an emotional connection with 1 picture and 8 words. Can you do that with your business? If so, call your outdoor advertising rep today. If not, get back to the drawing board and find another advertising avenue to explore.

Do you agree or disagree?

-Phil

Saturday, August 29, 2009

You Have to Have a Website

In today's business climate you HAVE to have a website. It is a minimum requirement of doing business.

Over 70% of all households have Internet access. That number grows even higher at higher incomes and lower ages. According to a Pew Report study, shopping is one of the top uses for both men and women.

The key word is "shopping". According to Merriam-Webster, shopping is defined as, "to examine goods or services with intent to buy". The wealth of information on the Internet makes examining goods or services easier than it has ever been.

From this data many of you might make the false assumption that you have to offer e-commerce on your website, that you have to join the throngs of online merchants. Although you certainly can be successful selling online, here's another statistic to make you think.

According to the Census Bureau of the Department of Commerce, online sales in 2008 were a whopping 3.3% of all retail sales. Yes, that's right. Only $3 out of every $100 spent at retail were spent online. I guess the demise of the brick and mortar store might be slightly overblown.

Here's the point. Over 60% of Americans are shopping online, but only 3% are buying online. So how are they using the Internet to do their shopping? They shop online four main ways.
  1. To see what is available
  2. To find information about features and benefits
  3. To read reviews from other users and experts
  4. To find stores that carry what they want
Yeah, the first three are pretty much the same stuff they could get just by entering your store and asking your staff (if they found you with #4). But they are doing it online for a number of reasons.
  • The Internet has more information than most sales people
  • The Internet is open when your store is not
  • You can surf the Internet anonymously (in your pajamas)
  • You don't have to show your ignorance
Those last two points are important. According to the Pew Report above, men are more aggressive shoppers online, which only makes sense. Men do not like to admit they don't know something. They don't like to ask questions. They certainly won't ask for directions. The Internet allows them to get all the info they need before entering a store so they do not feel inferior. Another group that prefers the anonymous aspect of Internet shopping are Introverts. They also like to get all the information they can before they have to interact with someone.

Men and introverts - two groups that collectively make up 75% of the population - give you all the reasons necessary for you to have a website. Think of your website as the Silent Salesman for your store. He costs a fraction of the other staff, yet he works tirelessly 24/7 building trust and goodwill and making customers more comfortable with your business. And he gets to embody all the qualities of your best salesman because you get to create him.

You have to have a website and you have to have the following components:
  • Your hours, location and contact information - make it easy to find, many people are using the Internet as their yellow pages
  • Your purpose for being in business - what you do and why (from a customer's perspective) you do it better than everyone else
  • What customers should expect when they visit - products, services, policies, etc.
  • Pictures - the Internet is a visual medium
  • More information - keep the basic pages simple (everything on one screen), but offer more for those who wish to click on it
The key is to make your site pleasing to the eye with minimal but well-written copy that answers the questions potential customers would ask about your business. Make it interesting and always about what the customer will find or experience in your store. And keep it consistent with your Character Diamond.

You don't have to do e-commerce. You don't even have to show all your products. But you do have to make sure you are linked to all of your vendor's websites as a place to buy. And make sure at the very least you talk about what product categories you do offer. List the best known brands and let them advertise for you. The goal is to give enough information to make potential customers interested, comfortable and willing to do business with you.

In today's business climate you have to have a website. Do you agree or disagree?

-Phil

PS If you're doing e-commerce, I highly recommend you read the book Call to Action by Bryan and Jeffrey Eisenberg. It will help you convert more lookers into buyers.

Tuesday, August 25, 2009

Email Marketing - Free and Easy or Spam City?

As we continue the discussion of how advertising works differently in different media, we enter into the new, scary online world of Email, Websites, and Social Media.

Today's topic is Email.

At a fraction of the cost of direct mail and with the availability of templates and email services, many consider Email to be the easiest, most inexpensive way to reach your customers multiple times with multiple offers and tons of information. Some call it the perfect solution to more costly traditional advertising.

And in many ways, they would be right. Here are some of the inherent advantages of Email Marketing.
  • It is relatively inexpensive to use. Constant Contact, one of the largest email services, offers plans as low as $15 per month, and only $30 per month for lists up to 2500 emails. That's $360 per year, or the equivalent of 818 first class stamps.
  • You can do it as often as you like at no additional charge.
  • It is quick. Within minutes of hitting the send button your Email is in the inbox of your recipients.
  • It is easy. You can write, edit, format, add pictures, do surveys and more with just a minimal amount of computer skills.
  • You can track your results quickly. Three simple ways to track the ROI include: How many emails get opened? (Is this number growing or shrinking?) How many coupons were used? How many people are subscribing/unsubscribing? If your list keeps growing, people are finding value in the info you send.
Email might be one of the best ways to utilize the new technologies to grow your business. But you have to cross a few hurdles to get there.

First, there is the list. Where did it come from? Who is on it? Do the people on the list want to get your email? To be successful, your email list has to be permission-based. It has to be people who gave you permission to send them stuff, people who want to hear from you. Otherwise, you're just sending spam and making people angry at you.

How do you get a good list? By asking for it. Put a fishbowl on your counter and ask customers if they want to sign up. Offer a $25 gift certificate drawn monthly for anyone who signs up that month. Put a link on your website (Wait, you don't have a website? We'll discuss that next). Put it on your Facebook page, register receipt and front door. Ask, ask, ask.

Second, you have to commit to sending out regular emails and checking your list regularly for accuracy. How often should you send out an email? Some people say weekly, others say daily. I say, whenever you have something new to say. At the very least, say something once a month so that the people on your list don't forget about you. At the very most, say something new EVERY time you send an email. And check for bounce backs. If an email address doesn't work, delete it.

Third, you have to have a thick skin. People will unsubscribe to your email for a variety of reasons and you'll get a report of it. You can't take it personally. But if too many people unsubscribe, either you have a bad list, or you're sending out a bad email (probably both). Tweak your message and see what happens.

The bottom line is that Email can be an extremely successful marketing tool if you follow these simple practices:
  • Get a good list. Get permission up front and let people know what they are signing up to receive. Grow your list by asking everyone everywhere if they are interested.
  • Use a professional service to send your email. I use Constant Contact, but there are other services. The professional services have templates for you to use, know how to avoid spam filters, ensure that you use best practices such as unsubscribe notifications, and can manage your lists more efficiently than you ever could.
  • Add pictures to your emails. A picture may not be worth a thousand words, but images are eye-catching and interesting. They also help the people who just like to skim and scan move from topic to topic.
  • Make the content fresh and new. Say something new with every email. It doesn't have to be a discount or coupon, but it does have to be fresh and new and consistent with your Character Diamond.
  • Send it out often enough to be remembered but not so often as to be annoying.
  • Measure the ROI. Is your list growing or shrinking? Are more or less people opening each email? Are coupons and special offers being used? If the ROI is not good, keep tweaking the message until it turns around.
If you have the time to write the copy, you have the time to send out Emails. And at the current rates, it is an affordable way for you to reach your loyal customers often and keep them coming back regularly.

If you can grow a good list, you should definitely be doing Email Marketing.

Do you agree or disagree?

PS Sign up for the Toy House Email Newsletter at http://www.toyhouseonline.com/.

Wednesday, August 19, 2009

Dipping Into the Well of Magazine Advertising

Every form of advertising has it's pros and cons. Magazines are no different.

To understand magazine advertising, you have to understand the magazine business model. Ray Bard of Bard Publishing explained it best when he said:
"When you're thinking about writing a book on a subject or considering a
business to go into, it's essential that you find out 2 things:
  1. How widespread is the public's interest in it?
  2. How deep is that interest?
"If interest is not widespread and not very deep, you're looking at a Puddle. Never invest time or money in a puddle.

"If interest is widespread but not very deep, you're looking at a Swamp. Be careful of swamps. They look like oceans at first because everyone is interested. But that interest is shallow, not deep enough to drive action. Investors go broke when they see a swamp and think it's an ocean.

"If public interest is wide and deep, you're looking at an Ocean. But you're going to need a platform on which to navigate your ocean. If you don't have a platform, you'll drown. And you're going to need a plan or you'll drift.

"If public interest is narrow but deep, you've got a Well.
Don't underestimate it. You can draw a lot of water from a well. I once knew a
writer who wrote a book called The Care and Feeding of Quarter Horses. The book held no interest for readers who didn't own a quarter horse, but those who did had deep enough interest to buy the book. It was extremely successful."


Magazines are Wells. Interest is narrow but deep. If you sell to rock climbers, there are magazines exclusively for rock climbers. If you sell to perennial gardeners, there are magazines for perennial gardeners.

No matter how niche your product, there is most likely a magazine that perfectly fits that niche. And unlike almost all other forms of traditional advertising, only magazines can consistently give you potential customers that exactly fit your profile.

So what's the downside? Two things...
  • Frequency
  • Cost
The more niche the magazine, the less often it is produced, meaning the less often your ad has the chance to be seen. And being a passive ad, there is the possibility it won't get seen at all. This can be tough if you're trying to promote an event or special sale and you miss getting seen in time. This can also be tough if you're trying to raise top-of-mind awareness (branding). Since frequency is the key to memory, lack of frequency works against your long-term goals.

And costs for magazine ads can be astronomical. If it's a full color magazine, you probably need a full-color ad just to have a shot at getting seen, and those ads typically cost more.

But if you think a magazine might be the right avenue for your advertising campaign, here are some things to keep in mind:
  • Make sure the readership fits your customer profile as closely as possible. Ask your current customers what magazine they read to help you choose which magazines would be the best fit.
  • Understand the goal of the magazine and match your ad to the goal. If the magazine is used primarily to give event information, you should advertise your events. If the magazine primarily is used to give information, make your ads informational.
  • Ask for discounted rates and priority placements in return for signing full-year contracts. The best customers get the best ad placements. Be one of their best customers.
  • Use professional production for your ads. The magazine is using professionals. You should too.
  • Keep it simple. Print ads are like billboards, only a limited time to get your attention. Your ad should be able to attract someone's attention is less than 3 seconds. Pay special attention to your headline and your graphics.
One of the biggest benefits of magazine advertising is the fact that people hold onto and re-read magazines often, giving readers multiple chances to see your ad. Add to that the chance to reach your very specific niche audience and magazines can be the well that fills your profit tanks full.

If there is a magazine with the exact right readers, a purpose aligned with the purpose of your business, a decent frequency, and a cost you can afford, you should consider it as a viable advertising option.

Do you agree or disagree?

Saturday, July 25, 2009

The Direct Mail Shotgun

A continued discussion of how ads work differently in different media...

Ready, aim, fire!

Shotguns are different from rifles. Rifles fire bullets, singular masses of metal propelled by gunpowder that make a single, clean (deep) hole in the target. Shotguns fire shot, a collection of small pieces of metal that scatter somewhat as they fly giving you a wider margin of error for hitting your target, but penetrate less deeply.

Direct mail is a lot like a shotgun, a scatter shot approach to finding new customers. You purchase a list of potential customers, create a mailing piece, send it out with a message that has wide (but not deep) appeal and hope you get a return. Unfortunately, the average return rate is usually less than 3%.

There are two problems with this approach:
  • The list
  • The message
It is difficult to get a quality list. People are more private and stingy with their personal information. They only give it freely when there is a promise not to sell or trade such info away.

The list makers all claim to have great lists, but there is a good chance they had to beg, borrow and steal to make a list that might actually get you a decent return.

Plus, these lists are based on basic demographics with no consideration for the all-important character traits these potential customers have. Demographics are far less important than psycho graphics for determining who will be most receptive to your message.

Creating a list on your own takes time and generally only gives you a list of current customers, not a list of potential new ones. This is okay if your goal is to get more repeat business, but not a way to generate new clients.

But let's say you are able to get a quality list of potentials at an affordable price. What are you going to say to them? How will you entice them into your store? A coupon? A discount? A sale?

While effective at drawing certain customers, coupons and discounts have some negative consequences, too. They signal customers that your prices are too high in the first place because you're so willing to lower them. They teach customers to wait for the next coupon or discount or sale. They tell your customers that prices are negotiable.

Also remember, the bigger the offer, the bigger the return (and the bigger the consequences).

You could make your mailing piece about a product, but you'll only be able to attract a portion of the list that is currently in the market for that product.

Now you see why although 46% of all adults read their direct mail pieces, 97% of the recipients of a typical mailer casually toss it aside and take no action.

If you're going to do Direct Mail, follow these tips:
  • Get your list from a reputable source or create your own. In this world of spam, permission is necessary to even get your mailer seen, let alone acted upon.
  • Ask for details of the list that go beyond age, gender, and income. Demographics such as these are not guarantees of matches for your brand message.
  • If you are sending multiple mailings to the same list, limit the coupons to once a year so as not to train them to wait for the next deal
  • Make your message as powerful as possible. Your message is like a magnet. It's power to attract is proportional to it's power to repel. Although some will be repulsed, others will be empowered to act.
  • Measure your results. A typical Direct Mail to a purchased list will garner about 2-3% response. Can you live with that? A good quality list with an above average message sent at the peak time of your season might get as much as a 5% response. A great message sent to your personally created list (your known fans) at the perfect time can get you a 9% response.

We only use Direct Mail once a year to thank our loyal customers for doing business with us. We send a postcard at the end of October with a message consistent with our Character Diamond and a coupon worth $20 off a $100 purchase (our only coupon of the year). Our return last year was 9.2%. Of course, the list was of high quality - all customers who had purchased from us in the past and asked to be on our mailing list. And the message was spot-on, hitting all the right buttons that made them customers in the first place.

Still, 90.8% of the postcards did not come back. And if you do the math... We generated over $100,000 in top line sales, but at a cost of almost $18,000 (printing, mailing and discounting costs). The biggest question is... How much of that was sales we might not have received otherwise? After all, the list was our greatest fans.

Use Direct Mail only if you know you have a quality list, know exactly how to say something powerful to them, and are willing to absorb those costs involved.

Do you agree or disagree?

Thursday, July 23, 2009

Yellow Pages - Advertising of Last Resort

Continuing the discussion of how ads work differently, lets talk Yellow Pages.

For some of you, your Yellow Pages probably take up half or more of your ad budget. I know. We used to be the same way.

Unfortunately, Yellow Pages are only for those people who have lost the will to advertise. It is the last resort someone takes to find a business they have never previously known. It is the last place someone will look to find you if they have not heard of you through word-of-mouth or other forms of advertising.

Think about your own Yellow Page habits. First, do you still even use them? Or has Google become the directory of choice? Second, are you looking up a phone number of a business you know or a category of businesses you don't know?

The Yellow Page reps have plenty of seductive statistics telling you things like how 88% of all people surveyed would go to the Yellow Pages first if they needed to find a plumber. Don't get trapped by the numbers. Ask yourself WWYD?

Here's what really happens... Your toilet has sprung a leak. You have no clue what to do. you don't know any plumbers. You reach for your phone. The first person you call is...

Your Dad. (Or spouse, or best friend, or boss or co-worker)

You ask them if they know a good plumber. By the time you get to the phone book you already have a name in mind of who you will call. The Yellow Pages only supply the number, not the name, not a referral. Think of it as an info guide, not a form of advertising and persuasion.

Forget all the statistics. As Winston Churchill said, "The only statistics you can trust are those you falsified yourself." The real truth is that you want customers to be thinking of you long before they need a phone number. You want them going to the phone book for one reason only - to look YOU up because they have already decided where to go, they just need a phone number and directions.

So when do you use Yellow Pages for advertising?
  • When you are getting traffic from outside your own phone book region and need a place for people to find your contact info.
  • When you are in an industry where no one advertises at all and the Yellow Pages are the only place to find anyone
  • When you are in a town with an extremely high turnover rate where no one stays long enough to make friends for referrals.

If you're going to do Yellow Pages, here are some tips:

  • Get all the free listings you can get. Some companies have deals that give you free listings under certain headings. Ask your vendors and ask your Yellow Page reps.
  • Go simple - Get your single line listing. If anything, add your website.
  • Be realistic - If you don't get traffic from a certain area, don't go in that book. The expense will not pay for itself over the long run.
  • Measure your online traffic to see if their online listing of you is giving you any referrals
  • Ignore the secondary books in your market. If enough people ignore them, maybe they'll go away.
Some people consider Yellow Pages the necessary evil of advertising. I question the necessary part. Your goal should be to get people thinking of you long before they reach for the book.

Do you agree or disagree?

Tuesday, July 21, 2009

Run the Radio Marathon to Finish in the Lead

As we continue our discussion of how different advertising media work, we come to my personal favorite.

Radio - the Marathon runner.

No, I'm not a runner. But I am in business for the long run. My time horizon for Toy House extends beyond my children. So I like advertising that also has long term benefits. Radio is one of those. A well-crafted long term radio campaign gives you slow and steady increases in top-of-mind awareness that builds upon itself exponentially.

Advantages? Here are some of the best:
  • Intrusive in nature - You can't turn off your ears. If the radio is on and you're in the room, you're listening. No mute buttons or fast forwarding like TV, no flipping pages like newspaper.
  • Can reach a lot of people inexpensively - Unlike newspaper circulations in decline and TV viewers fractured by hundreds of choices, radio listenership is going up.
  • Can get high frequency - Radio listeners stay fairly loyal to their stations and listen on a regular schedule
  • Words are powerful

Television allows the combination of words and visuals to create a powerful message, but words alone can stir the heart just as compellingly. Forget the old saying, "A picture is worth a thousand words."

"In a thousand words I can have the Lord's Prayer, the 23rd Psalm, the Hippocratic Oath, a sonnet by Shakespeare, the Preamble to the Constitution, Lincoln's Gettysburg Address and almost all of the Boy Scout Oath. Now exactly what picture were you planning to trade for all that?" - unknown (anyone have a source for this quote?)

The key to Radio is repetition. You have to be on early and often, frequent and continuous. You also have to say something interesting. Like all advertising, boring ads never work.

Think about the average radio listener. She is probably doing something else while bopping along to her favorite song. Her mind is already half occupied. When the song stops and an ad comes on, her brain ignores the ad and fully engages the other activity until the music draws her partially back to the radio.

For your ad to be effective you have to say something more interesting than what she is currently thinking at the time. The biggest complaint from radio listeners is that there are too many ads. The solution is not to have fewer ads, but to have better ads, commercials that people want to hear.

That means stories. Yes, radio is about telling a story, painting a mental image, taking a listener to a new place in her own mind (your store).

If you want to do radio and be successful, follow these tips:

  • Commit to one full year - it takes a long time of continual repetition until a radio campaign gains traction. Commit to a full year and stick it out. (two years if your product cycle is extra long like flooring or real estate)
  • Run a Schedule with a minimum frequency of 3x per week - Sleep is the great eraser of the mind. It takes someone hearing your message three times in 7 days to have it sink into memory.
  • Change your ads (but not your message) every month - Keep the campaign fresh and exciting
  • Only make one point per ad - No one can remember more than one thing, so only say one thing
  • Your name is more important than your address - They'll google you if they have to find you
  • Say something interesting - Stories are interesting. Unexpected is interesting.
  • Don't sound like an ad - Ads and adspeak are not interesting. Find a creative writer who doesn't write radio ads, just persuasive, compelling copy.

Here are some samples of radio ads that tell stories and don't sound like ads. My personal favorite is Men's Bathroom.

Radio is the long distance champion of branding because of the relatively low cost of reaching the same people repeatedly week after week with a powerful message when compared to TV and newspaper. The downside is the time commitment.

It's like the old Chinese Proverb, "The best time to plant a tree is twenty years ago, the second best time is today." The best time to start a long term radio campaign is a year ago, the next best time is today.

If you're a sprinter, looking for the quick hit, radio might not be your friend. It's also not for the dabbler. It takes commitment and creativity to be successful. If you have the budget to run for a year, and a creative writer to convey your message powerfully through words, radio can be your best friend.

Do you agree or disagree?

PS You CAN be successful on the radio for short term events, too, but it takes a whole different way of scheduling. Send me an email and I'll tell you how to run that campaign, too.

Monday, July 20, 2009

Television - the Super Bowl of Advertising

We're discussing how ads work differently in different media.

Today the topic is Television - the Superbowl of advertising.

Just like the Super Bowl that everyone seems to watch, even if they are not a football fan, TV Ads get seen every day by people who are not fans of commercials (except, of course, the Super Bowl commercials. Ironic, isn't it?)

The strength of television programming is it's ability to tell a story. Whether a serial like a sitcom or drama, or a one-time event like a Hallmark movie or sports, television is the story teller of our age.

Therefore, the strength of television advertising is in the ability to tell your story.

Television allows you to combine powerful words and music with compelling visual images to create an amazing experience and tell a wonderful story in a short window of time.

The downside? Money. It costs a lot of money to produce a quality ad that people might actually watch. It costs a lot of money to put that ad out there enough times to be seen and remembered. It costs a lot of money to run a television campaign and keep it fresh and in front of your customers over a long period of time until they are in the market for your product and are finally convinced to buy from you.

It can also be expensive when you do it wrong. And believe me, many advertisers get it wrong. Here are the three most common mistakes:
  • Using humor without reinforcing the brand (Quick, name the Super Bowl advertiser with all the monkeys at work. I'll bet less than a third of you were right.)
  • Making the ad entertaining but not telling anything about your company (How many people thought GoDaddy was a softporn site for men thanks to those Danica Patrick ads?)
  • Trying to say too much (Most local ads do this, packing way more info into an ad than anyone could possibly remember)
If you're going to advertise on TV, follow these tips:
  • Get professional production. Lousy looking ads with bad audio or video give the wrong image of your business.
  • Get people's attention in the first 3 seconds (before they can grab the remote).
  • Make one point and only one point in your ad. Everything else is just clutter and another reason for someone to tune you out or forget what you say.
  • Use emotions. Emotions connect your brand better than humor or cleverness.
  • Only use humor or cleverness if it reinforces your brand, otherwise the humor will trump the message and the message will be lost.
  • Make your images move slowly across the screen. They will be seen even by people fast-forwarding their DVR's.
  • Schedule your ads so that they get a good frequency (reaching the same people more than once). Frequency is just as important as reaching a lot of people.
  • Keep it up. Branding campaigns take time to get traction. It's a long term commitment.

If you have the guts (and the money) television can be a powerful advertising tool, especially for building brand awareness. But beware. Your ads can just as quickly be ignored.

Thanks to remotes and DVR's (and boring, unemotional commercials), television ads can become as invisible as non-relevant newspaper ads. It takes planning, dedication, time, and a producer who understands your message and knows how to portray it powerfully.

Do you agree or disagree?

Advertising in Newspapers the Right Way

Most advertising fails because it is the wrong type of advertising for the medium in which it is placed. As I mentioned before, I'm going to discuss a variety of advertising media and how they work best (and worst).

First up is Newspapers - the medium of Relevancy.

To start, let's identify the elephant in the room. Yes, newspapers are shrinking in numbers, size and circulation. Yes, many are predicting the demise of the newspaper as we know it within a decade or less. But they still have a wide audience of dedicated readers today. I'm one of them. I read my local newspaper cover to cover every single day.

Yet, I cannot remember a single ad I saw in yesterday's paper.

Why? None of the ads were relevant. (Half the stories weren't relevant either, but that's another discussion.)

Think about how people read newspapers. They scan the headlines looking for something of interest. (Newspapers have people who only write headlines - specialists at getting your attention.) And if the headline is successful, the reader might quickly skim the first paragraph to see if they are interested in reading further. (Journalists pack that first paragraph with the main point of the article, knowing that most won't read a single sentence more.)

The newspaper is all about scanning and filtering, looking for something that is relevant to the reader.

Therefore, to have your ad work in a newspaper, it has to be relevant to the reader. Just mentioning your company's name isn't relevant. Sorry, you just aren't that important. Relevancy comes from talking about a product or event. Are you having a huge furniture sale? That is relevant. Are you the new distributor for a well-known brand? Relevant.

If you run an ad with a big sofa pictured, you'll attract everyone reading that page who is currently in the market for a sofa (and no one else). If you run an ad with the headline, "HUGE TOY SALE" you'll attract everyone currently in the market for toys.

To be successful with newspaper ads follow this advice:

  • Make your ads Relevant by focusing on a product or event.
  • Understand that regardless of what the salesperson told you, only the people currently in the market for your product will even see your ad
  • Use a clear picture of a product or a catchy headline to grab the customer's attention
  • White space is your friend - it makes it easier for customers to see your picture or headline
  • Don't use a full page - most people don't even look at it because there is no content on the page - a half page or less has the best chance of being seen
  • Don't make the ad about you or your business. You aren't that interesting or relevant.
  • Inserts work only if your market is the Transactional Customer

Newspaper advertising is for selling products and announcing events. It's not very good at branding your company or mission.

Relevant wins in newspapers. Everything else is invisible. (The same is true for advertising in online papers.)

I challenge you to pick up today's paper and carefully read every ad. See how many are about products or events. See how many use a catchy headline or picture to grab your attention. And see how many would have been invisible to you if not for this assignment.

Do you agree or disagree?

Sunday, July 19, 2009

Which Medium Works Best for Your Ads?

You’re not sure where to spend your ad dollars. It is hard-earned money and you need to make the most of it. You ask all your buddies in the industry where they get the best results. Unfortunately, twenty questions garner twenty responses, all different. You’re still confused and unsure.

Which medium will work best for your ads?

Three of your colleagues really like TV, but three hate it. Four swear by direct mail, but five call it a waste of money. Radio, newspaper, and yellow pages also receive mixed reviews. Add in the lukewarm repsonses to websites, email, and social media and there is no clear cut answer… until you change the question.

How does each medium work best (and worst)?

Why so many answers to the first question? Most businesses don’t understand how ads work. Every form of advertising has its pros and cons. When used properly any one of them can be made to work. When used wrong, it is just a waste of money. To be successful with your ads you have to know two things:

  1. What are my objectives?
  2. How does each medium work best?

The first question is up to you. I’ll help you with the second question. And when you know these two things it will be easy for you to choose the right medium and tailor your message to work best.

Over the next few weeks I’ll discuss the different media and how they work, including:

  • Newspaper
  • Television
  • Radio
  • Magazines
  • Yellow Pages
  • Direct Mail
  • Email
  • Websites
  • Social Media

(Is there another medium you’re considering that is not on the list? Send me a comment and I’ll add it.)

Stay with me on this. There is some eye-opening information coming.