I ask business owners this question and I often get blank stares. Sometimes they might say that they haven't really thought about it, or they just shrug and say they don't know.

I ask from another angle: What are you, as a business, really good at? What do you do best? Who are your best customers? Then they start to understand and have clarity.

An IT company I use for my own business are really good at making sure their commercial customers have reliable computers that keep on going. They have great system checks to make sure the computer is working at top efficiency without losing data and that all information is secure from hackers. They also fix most problems remotely so their customers don't pay travel costs and incur time out every time something needs fixing.

Another IT company I know has a different set of strengths: they specialise in providing records that alert business owners if employees are spending too much time on social media or other sites rather than working. (By the way, a Kansas State University researcher discovered that between 60-80% of time spent on the internet at work has nothing to do with work.) This business also helps parents with software to control their home computers so that their kids don't come across things they shouldn't while online - big deal these days, if you have kids. 

Notice both these businesses are Christchurch companies in the same industry - but they have very different strengths and distinctly different customers. And doesn't it follow that they should be marketing in completely different ways to reach their target potential customers?

If you are still not sure what your strengths are, the best way to find out is to ask some of your customers why they come to you, or what they think you are good at. If you ask 10 of your best customers these questions, you will have a whole new insight into your business. 

The answer to these questions are your "point of difference" or "unique selling position". 

Once you have some ideas, then you will want to clearly define this into a statement - like these great examples:

When it absolutely, positively, has to be there overnight - FedEx
The best a man can get - Gillette
The best tires in the world have Goodyear written all over them - Goodyear Tires

All very clear statements saying why you should deal with their company or buy their products.

Once you are clear about what you are good at, you need to shout it from the rooftops - why? Because this will bring you a truck load of new customers. And not just any customers, but the most profitable ones that best suit your business. They will be better quality customers because they have responded to and appreciate what you uniquely offer. They see the value in what you do and won't be so concerned about price.  

Here is an example from the customers viewpoint. Imagine you jump in your car and discover your windscreen has a huge crack - it's broken and you have a sinking feeling it will need a whole new windscreen. You need your car for work and you are imagining a worst case scenario where you are without your car for weeks. You need it fixed fast, but you don't know who will be able to get it done quickly. You Google or grab the Yellow Pages. You come across a company who says "We are local; we source and install a replacement windscreen within 48 hours - we are the fastest service in Canterbury." It's a no brainer - you ring them and get the job done; they did it the same day; you are now a loyal customer and you tell your friends how great the service was. 

Just remember, until you get clear about what sets you apart from your competition, you are behind the 8-ball. Also remember, you can't be all things to all people - so don't try to be.

Action Point: Define your point of difference into a clear statement and start including that in your marketing and advertising. Then take note of how many new customers you get and if they are the type of customer you are looking for.

Do this well and you will be amazed at the results.

Have you ever spent a whole heap of time wooing a new prospect, putting together a detailed quote or proposal and you just knew they would sign on the dotted line - but the deal didn't go ahead?

This one was in the bag, at least in your mind anyway. Now you are thinking about all the wasted time and effort you put into this sale that has just slipped through your fingers. And you don't have a clue why. What was your prospect thinking? They must have it wrong. It just doesn't make sense...

We have all been there, so let's have a look and discover what went wrong.

The main problem is that you didn't get into their world - you were still in yours. In their mind, you didn't offer the whole solution to their problem or at least have a better solution than your competition. Result = No sale.

In my world as a business coach, I try not to assume that I know what every business owner wants. But we all just want more sales and more profits, right?... Well, no, the reality is often more complex. Many business owners do need more sales and more profits, but sometimes they need other things even more. For some the highest priority is to get more time with wife and kids, less stress, a holiday once in a while, freedom where the business does not rely on them so much that they can't take a breath. For these business owners, if I talk about more sales and more profits, it just sounds like more hard work - exactly what they don't want!

In a sales meeting/presentation, or negotiation of any kind, both sides must agree first on the objectives of the meeting. If you do not, you will be heading in different directions and often this results in the sale being dead in the water.

So how do you get into their world? You need to be a detective and search for the real problems your prospect wants to solve. And here is a clue - often the first answer they give, is not the answer you are looking for - there is another important layer that you still have to find.

Let me give you a real life example from a sales training I did last year. I'll recount the story for you - details are accurate but not verbatim:

A real estate agent had a customer, who we will call Jan, who was looking for a house with a "nice view". Jan had been around all the real estate agents in the area and no one had been able to find a house she was happy with. Our real estate friend showed her all the houses that she believed had the best view including looking over the city, looking out to sea, overlooking some beautiful open parks. But much to her frustration and surprise, every single house Jan was shown, almost immediately received the same response: "No, this is not what I am looking for".

Every option seemed to be exhausted and she seemed no closer to finding a house Jan was even remotely interested in. So the real estate agent had to try a different approach as this one clearly wasn't working. So she asked her client a different question: "All the houses we have looked at I thought had a good view, but you didn't like them. So that I can understand more clearly what you are looking for, can you tell me what you mean by a good view?"

Jan explained that her husband liked repairing old cars and he would do this in the driveway. She was sick of looking at half assembled cars and car parts when she looked out her kitchen window. Everything she has seen so far had a view of the driveway from the kitchen window. Suddenly, our real estate agent understood what Jan really wanted, and she now had the complete answer. The next house she took Jan to, she loved. Jan found a house, the real estate made a sale and everyone was happy.

Now Jan is a raving fan, and this is what she said to the real estate agent once the deal was done: "You were the only real estate agent who took the time to understand me and what I wanted - Thank You". Did finding Jan a house have to take that long? - NO, it just needed the right question.

Our real estate friend was never going to get there by assuming, only by getting into Jan's world. This is a true story!

Here are some questions that will help get you into the customers world:

• What are you expecting to get from using this product/service?

• What are the main benefits for you?

• What is the main problem you are expecting to solve with our product/service?

Try threading these into you next negotiation or sales meeting - you will be surprised what you discover. It may be the difference between making your next deal or missing out.

When I first begin working with a business to improve profits, we start looking for the low-hanging fruit first. Just like when you are picking fruit from a tree, some fruit is low-hanging and easy to get to. At ground level there will be some fruit you can just reach up and take without a lot of effort. However as you move further up the tree the fruit will be in harder-to-reach parts which may require climbing, or the help of a ladder.

The same principle applies to business. We are all busy and the reality is that if we look around the business there are literally dozens of things that could be actioned to improve profits. But the fact is, it is unlikely you have the time to action a dozen changes, certainly not in the short term anyway.

Here are some examples of low-hanging fruit I have seen in businesses, which, when actioned, had a dramatic effect on profit:

Negotiating with suppliers - Look at the pricing from your largest suppliers and compare with their competitors. Then renegotiate better buying pricing to increase your margins. Often with suppliers they supply pricing to a business, the business grows but they are still on old pricing based on smaller volumes.

Approach old customers - Start approaching the old customers who have not brought from you for a while. A number will buy from you again if you just ask.

Tell your customers about other products - Start offering your existing customers products/services they are not currently buying. Most will not even know what else you can do for them.

Shop window - In retail, displaying specials, new stock, or add-ons that goes well with products you sell a lot of, will entice customers to buy more, and bring new customers through the door as well.

Collecting the money - Instructing your accounts person to make a few phone calls to chase up outstanding debts can make a big difference. Holding them accountable to do this job takes only minutes.

Invoicing on time - Many businesses do not invoice on time and it causes problems down the line. This may not give you more profits directly but you will certainly have more time and less stress without cashflow headaches.

Pricing - Simply increasing your prices by a small amount will make a big difference to your profits and in most cases your customers will not even notice.

Promoting your best sellers - Identify your best selling products, and products that have great margins. You can easily promote these (for example in an email to your customer database, or on your Facebook page) - and sell more of them.

Regular staff meetings - If all your staff a) feel appreciated and encouraged regularly b) know what is expected of them c) know about your latest specials and where you are heading as a business - this will result in more efficient staff, more sales, more profits.

These are just a few examples. Take a moment to ask yourself "what is the low-hanging fruit in my business?" and "what are the easy wins that will increase our profits dramatically without a lot of effort?"

Remember, business does not have to be complicated. Even if you do not have a lot of time or energy, you can still be making small positive changes to improve your business. There are always some things we can do to improve that are quick and easy. So reach out and grab what you can get! I promise you the rewards are delicious!

I thought this month, that it would be fun to look at some of the things you shouldn't do with your business.

ABC Procrastinate Ltd
ABC Procrastinate liked profits and customers, but they had been pretty busy dining out on past successes. Financially things were now a bit tight so they decided to have a meeting to see what could be done. Here are some of the answers they came up with.

1) Having realised that what they were doing was not working, they decided to get everyone to double their efforts doing exactly the same things.

2) Having realised that their margins were terrible, they decided to buy a new truck and sell more product at the same price.

3) Having realised that they knew nothing about marketing, they decided to form a task group including more people who knew nothing about marketing.

4) Having realised that sales and profits were down, they decided to reduce their sales staff and cut their marketing budget in half.

5) Having realised they had no direction for the company, they decided it was time for a good lunch and a lively discussion about which paint colour they should choose for the new office door.

6) Having realised that results for the last quarter had been terrible, they decided to close early and go to the pub.

7) Having realised that they had lots of enquiries that they could not turn into sales, they decided to get angry at the people who didn't buy because it was clearly all their fault.

8) Having realised that they desperately needed some help with marketing, they decided to buy a good book even though they didn't think they would get around to reading it any time soon.

9) Having realised that their customer service was terrible, they decided it was the perfect time to advertise everything in the store at half price.

10) Having realised that their staff did not know what was expected of them, they decided that paycuts all round would help them to understand what they needed to do better.

11) Having realised that staff were disgruntled, they decided to put up a sign in the staffroom encouraging everyone to have a happy day.

12) Having realised that cashflow was not going well, they decided to ignore it because it was all too hard and it would probably come right by itself anyway.

Just a bit of fun this month - however amazingly I have seen and heard of these type of things actually happening.

A customer database is the most valuable part of your business, and here is why:

A database is simply a list with contact details of the customers and prospects you have dealt with over the lifetime of your business. Most companies have one in some form or other, but very few use it. They are so busy looking for new customers they have forgotten about the customers they already have.

So why is a customer database so valuable? Lets imagine that you started a business from scratch, no customers, not a single one. So you start an expensive advertising campaign to get new customers. While you build sales, every month you lose money on overheads and expenses while you work hard to win customers one at a time.

It is not unusual (without clever sales and marketing strategies), for a start-up business to take at least 12-18 months to consistently have enough customers buying your goods or services to break even (where income coming into the business will cover all purchases and expenses).

So as you can see, customers are your business – without them you just have a black hole where your money disappears never to be found again. In simplistic terms your existing customers could also be called the "goodwill" of the business.
 
When you have a customer database, what can you do with it?

Ah here is where the magic starts. Most companies spend a lot of money looking for new customers through expensive advertising and marketing. In a previous article I mentioned that an existing customer is 5-6 times more likely to buy from an offer you make than someone you approach who does not already know your business. The more often you are in contact with your customers the more times they are likely to buy from you. So lets look at some of the things you can do to get those old customers coming back, or your current customers coming back more often.

·      Letting your customers know about new products you have that would interest them.
·      Keeping them up to date on developments in your industry.
·      Information on how to use your products better and in new ways.
·      Specials and promotions you are running.
·      Invitation to come back to your business with a special offer.

Note: Keep in mind that what you send needs to be relevant and of interest to your customer.

Simply by contacting your customers more regularly – you will do more business!!

Assembling your database:

As mentioned earlier a database is simply a list of customers and their contact details. This can be in a number of different forms:

·       Customers in your accounts software
·       A full CRM system

Or you might only have:

·      Invoices with customer details on them
·      Pile of business cards
·      Customer details on competition forms
·      Also quotes given to potential customers

To be useable your list needs to be on computer and with enough information to be able to contact your customer directly. This could be by post, fax, email, text or a phone call. Email is obviously the most cost effective as there is little to no cost.

If you don't currently have a database or it’s not on computer, no problem, just start collecting customer details. A very easy way start or increase your database is to run an in-store competition and ask customers to complete a simple form to be in to win. This can be entered onto an Excel Spreadsheet and BAM YOU HAVE YOUR DATABASE. If you do not have the time or are not a computer person, pay a good typist or secretarial service to enter your customer details. It won’t cost much and will pay you handsomely in extra sales in a very short time!!
 
I find most companies are in one of three situations:

1.    Don’t have any customer database –

Action: Don’t waste another week, start collecting customer details now!

2.    Have a database, but not using it -

Action: Start putting together something to send your database with your latest promotions and see what happens!

3.    Regularly sending customers something, but not really getting the full benefits in sales -

Action: Start putting yourself in your customers shoes and give them content that will be relevant to their needs and situation, or some “killer offers” which they can’t resist!

Often businesses are looking that “one big thing” that will turn their business around or take it to the next level.  But it is those small increases repeated consistently every day that will make the biggest difference.

Let’s have a look at how the small numbers can add up.

I have listed below nine key parts to your sales process:  

Let’s set the objective of improving each of these by a very small increase of just 5% and see what happens:

1)       + 5% increase in leads   

A lead = identifying and approaching a person or business that has an interest in your product or service and the authority to purchase it. 

There are literally tons of ways to get 5% more leads and sales appointments, including advertising, signage, directly targeting a specific group with letters or emails, website, cold calling, etc. Just improving existing strategies or adding new sources will quickly improve your numbers.

2)       + 5% increase in conversions

Improve your conversion of inquiries to sales. The best way to do this is to improve the abilities of you and your sales staff. This could mean completing sales courses, gaining a better understanding of the features and benefits of your products/services, and better understanding your best customers and why they use you (ask them - you will be surprised what some of them say).

Becoming armed with more skills and a better understanding of your customers will definitely increase your conversions by at least 5%.

3)       + 5%  increase in average dollar sale                        
            
Obviously, if you can sell more on average to each customer, sales increase automatically. It may be as simple as offering them something extra. Make sure you always bring out the dessert menu!

You can do much in this area to bump up your sales - including increasing prices, up selling, and cross selling, just to name a few.

4)       + 5% increase in customer visits

Getting customers to buy more often is a very easy way to increase business. Of course it depends on what you are selling as to how many more times you can get your customer to buy.

If on average a customer buys from you 4 times per year – think of ways to get that average up to 4.2 times per year.

Even if you are selling big ticket items, think long term. If you are selling houses, remember that on average a home owner will buy 5-6 in their lifetime. Stay in touch, and your customer will think of you next time they want to buy.

5)       + 5% increase in products and services sold        

Options to get your 5% increase here are endless and include selling more items, larger quantities, adding other products or services to your range, targeting products not previously brought by that customer, and many others.

6)       + 5% increase in client retention

Client retention is about keeping your customers for longer. It does not matter what business you are in, there are plenty of competition doing everything they can to take your customers. In some cases they will be successful. 

To stop customer attrition, you might consider putting in place a loyalty program for your business. “Buy 10 coffees, get the 11th free” may seem dull but it works. Yet very few businesses actually do use this simple way to keep customers coming back.

7)       + 5% increase in follow up

Follow up old quotes and customers on your database that didn’t buy. Engage their interest - get your prospect to look further into your product or service. Think of innovative ways to stay in touch with them such as sending further information, free samples, newsletters, or a phone call to talk with your prospect about their needs.

Remember not everyone is ready to buy now, some will just be researching or it is not quite the right time. Some will buy later on – so make sure they buy from you by continuing to remind them that you are the best choice.

8)       + 5% increase in referrals            

Most businesses rely on word of mouth as a way to attain a portion of new customers. However word of mouth is quite unreliable and hard to predict as the circumstances often need to be just right for a referral to result. 

You can get more referrals by actively encouraging your customers to give referrals with the right system and incentives.

9)       + 5% increase in reactivation of previous customers

Every company has a list of customers who previously brought but for whatever reason are no longer buying from you. Re-approaching these old customers can be a goldmine for new business.

So we have covered nine areas of your sales process and looked at simple ways of optimising each area by 5%.

So let’s have a look at the numbers:

Sales                                                   $1,000,000

9 improvements x 5% each          45%                       

Increase in sales                             $450,000

Total sales $1,450,000 – a whopping 45% more sales.

So you see, small numbers can make a big difference to your sales. With a little focus and consistency in each of these areas you can make a massive difference to your sales and profits.

Time is limited and it is important to do each one well to get the best results. Pick one strategy per month to work on. In nine months you will have a minimum of 45% more sales than you had before. Not bad for a few small changes.

By the way, you will find that at least one of these strategies will give a lot more than 5% increase. It is quite possible that one of these could give you 30%, 40% or even 50% increase. So go for it now and get your business flying.

One more thing, to get the real benefit from these strategies it is important to make each one into a system that everyone follows. Make sure you clue your staff in and make it a team effort!

This process is simple – but most do not follow through. A year later they are no further ahead. Don’t be one of those - start now and take some action – there is no better time than now.

Always remember, business is a lot like fishing. The more lines you have in the water, the more fish you are going to catch.

Suppose you have ten fishing lines in ten different locations – chances are you will catch more fish. All the bases are covered. And of course when you find where the best fish are biting, you will make sure you put most of your efforts there.

So how many fishing lines do you have right now for your business?... website, advertising, referrals, customer loyalty program, signage, effective quote conversion, in store promotions, social media...

When marketing your business, you should have a minimum of ten different marketing strategies for increasing customers and sales in your business. Also make sure you check those lines for bites, and record where the fish are being caught. The biggest mistake many businesses make is that they don’t measure the results!

That promotion from six months ago - can you remember how successful it was; would you use it again? The only way you can decide that is by looking at the results. (If you are unsure how to measure this, email me for a free form and instructions.) -

How many customers came from it?

What was the cost of the promotion?

How much profit did you make?

All very important questions.

Here are a few ideas to get you started:

·         Advertising

Done well this should produce a steady stream of customers to your business – however make sure you are getting back more than you are spending. If not, then you need to change your approach until you do.

·         Centres of Influence

There will be key people or companies you are associated with that could be a great source of business and referrals for you. This could be a key customer who is already giving you referrals or even a supplier. Talk to them about how you could systemise referring each other customers.

·         Joint Ventures

This is a company who has similar customers to you but does not directly compete with you. A hair salon and a cafe both have customers who would use both services, so you would make an arrangement where you refer business to each other with existing customers. Done well this is a very cost effective way of getting a lot of customers quickly to your business.

·         Networking

Attend networking events in your local area such as events held by your local Chamber of Commerce, BNZ who hold regular networking events every month for anyone in business, BNI, or trade shows. These will all have businesses that could be potential buyers for your products and services.

·         Add-On Sales

There are always opportunities to increase sales to your existing customers. If you are selling men’s clothing, the perfect time to sell a tie to this customer is when they are buying a suit. This needs to be a focus for all staff and a deliberate strategy to increase sale value.

·         Making the Sale (Conversions)

How good are you at converting walk-ins, enquiries or quotes? A case study I often use shows how a driveway company originally getting 1 customer for every 10 enquiries, is now getting 5 new customers from every 10 enquiries, just by improving their quotation process.

·         After Sale and Repeat Sales

This is about getting your customers back more often. If a customer visits your business 3 times a year, by increasing their visits to 4 times per year, assuming they buy the same value as before, will increase business by 33%.

·         Referrals

This is encouraging your existing customers to refer others to your business. You might give some discount or reward to your existing customers for referring you more business.

·         Website

Is your website bringing customers and enquiries to your business? A good website will be bringing paying customers to you in the form of either direct sales or enquiries you can then convert to sales. Check to see how much business you are getting from your website - how many visits, and how many enquiries or sales. If conversion is poor, then you need to change your website and then increase the number of visitors to your site.

·         Database

Most businesses spend a lot of time looking for new customers, and ignore customers they have already dealt with. Did you know that if you send your previous customers an offer, they are six times more likely to buy than someone who is a stranger to your products or services.

A database is simply a list of your customers and leads. It does not need to be complicated, and can be entered on a simple Excel spreadsheet if you do not have database software. This one is essential and every company without exception should have a database and be regularly contacting customers/potential customers with offers and information they will find useful.

By just working on one of these strategies every month, in 10 months you will have 10 streams of customers – what would that do for your business?!

Also be aware that not everything you try will always work first time, in fact if you are new to this, a lot of things you try will notwork. Keep at it because once you find the best fishing spot your bucket will be very full; it just takes time.

The fast track of course, is to get an expert fisherman who knows the tides, best locations, weather patterns, and the right bait for different fish. Even then he still needs to adjust to changing conditions – however compared to the inexperienced fisherman, odds are he will find more fish more quickly day in and day out.

You have probably noticed that there are a number of “Daily Deal” companies like Treat Me, Grab One, etc. They all heavily discount products or services (usually 50%+) available for a 12 or 24 hour period.

All of these websites have a significant number of email subscribers so it is an easy way to gain access to a large number of potential customers quickly, and can be a tempting way to increase business.

An article I recently came across "The Parable of the Cobbler" sums up the pitfalls very well.

Here are a few things the cobbler and yourself should consider before trying this type of selling.

1.       Do you still have a margin?

After giving a 50% discount off your product and then a further commission to the website (up to 20%), can you still make profit off the sale?

Calculation:

Retail Value of your product                    $100

Less 50% discount                                         $50

                                                                              $50
Less 20% commission                                   $10

Sale Value =                                                      $40

Margins have to be very good to still make a profit after this type of discounting. There are some businesses this model will fit, like cafes, hairdressers, mechanics etc, where margins are high and there is also the opportunity to introduce “add on sales” to the customer after the original purchase.

2.       Can you turn them into a lifetime customer?

When marketing to new customers, by the time you take into account acquisition costs including advertising, marketing, discounting etc, it is usually not until the second sale that you start to make money off this new customer. The difficulty is that most of these coupon buyers are bargain hunters and will be looking for a new bargain tomorrow - most are not likely to be a long term customer. (Note: There are always things you can do to ensure that a percentage of these become raving fans of your business and will stay, but that is more than we have time to cover in this article).

3.       If you discount, will you still be able to get the full price again?

Discounting is a strategy that you do not want to over-use. The danger is that if used too often or regularly you are training your customers not to buy off you until you have a sale. There are many companies that fall into that trap. Retailers like Kathmandu and Briscoes - because they have such large and regular sales, many now perceive their normal price to be too expensive, and will just wait until the next sale. Once customers are thinking this way, it is almost impossible to change it.

So in summary, make sure it fits with your pricing and marketing strategy in the longer term. Make sure it will attract the right customers and at the right price for you!